Alejandro Suárez Sánchez-Ocaña. Entrepreneur and private investor sector Internet and New Technologies.
This text is an article published in The World Economy and Business of Venezuela and can be read in pdf here
Last night pondering the projects longed garage ... Those were the days! and wanted to share some thoughts about it. Those who like me have spent more than 10 years in Internet we remember well, and at least I wistfully, garage projects. The concept, as always imported from the U.S., we came to pass that talent, the idea increasingly obsolete, and its implementation could make from a small town in Arkansas, two buddies in his spare time, after school, do something important on the Internet and build a project that could spread beyond and reach the world. It was as real as utopian: online "you can be the English Court".
In Spain, my country, there were many projects really well, but it existed in the U.S.. Many of the companies mentioned in cyber space late 90s literally born in a garage.
People like Bill Gates or Steve Jobs started well, in a garage. But for years the romantic concept of these spaces has fallen from grace. I imagine that it was foreseeable and it's probably even healthy, but those "garage projects" have not disappeared, they have become. What in 1998 was an idea, a computer, a small footprint and a dead hours of programming, creativity, Pronatura and work forward, today has become a Power Point or at most in a pdf, and a string of visits to business angels, family offices, venture capital and various events.
I do not want to prejudge or position myself clearly, but I do a little thinking aloud that do generate opinion: Do not spend time today "looking for money" literally, unlike 10 years ago when the previous generation or arose initially conduct a Business Plan? They just wanted to start showing its concept, its implementation, its media-often rudimentary, and ability.
In the late 90's were young boys, often pre-university, who implemented the project. Today entrepreneurs are rarely less than 24-25 years. Almost always ers who have completed or are about to finish the race, that is, when "have to leave" to make a living, but not before. With the generational change we have not delayed the timming? Would it be a total change, once the concern of the need?
Those high school kids, under 20 years of age, who had created their project and illusion, no longer exist? And finally, if the crisis off the tap of money, what sense have these PDFs and Power Points circulating like crazy from table to table? Sharpen the wit that? Illiquidity? That is, back to the garage? I do not know if we will be able to return to that point, but I think if it were, in a way, would all much more charm.
This text is an article published by the Reason of Mexico and can be read in pdf here
I mean Business Angels. The more accurate translation of this could be anglicized "angel investors", and generally are, angels, and sometimes even also investors. One of the most recognized Business Angels sector of technology and innovation I confessed: "My range of investment is making an effort, 200,000 euros." Almost all of the new companies in the technology sector need first funding of close to 400,000 euros and the first step is usually to resort to classic 3F (Friends, Family and Fools).
But of all new business ventures in the technology sector, only 30% achieved a poor pass this first hurdle, the other 70% of projects that generate employment and wealth remain forgotten, awaiting funding. Raising money close to 400,000 euros has always been difficult, but it is more difficult to understand why the crisis does not affect the achievement of funding to date. A few months ago there was money for a few and you, as an entrepreneur, you were not among them, now joy! We are one of the few cases in which the situation has worsened with the crisis, we like, no money for your project.
The problem is to re structure. Figure of Business Angels and almost no traditional societies are generally Venture Capital "Capital" justito and "Risk" little or nothing. Today only support projects clearly winners and rarely attends investments below one million euros. The result: a no man's land that would have to pay for him to be watered Business Angels willing to support new companies. We should also note that there are few truly angels come and go and often sector. I would say that the few who are studying, supporting and sticking up for this sector are mostly successful entrepreneurs who have a bit of daring and a lot of romance.
In many countries, the work of these investors are not yet regulated, has no fiscal framework defined and has not the slightest institutional support, not even with rules of the game established. Possibly for this reason, people do not know what it is, what it represents and what it means to be a business angel. Afortunadamen you there are grounds for optimism. They have already begun the first steps and we just have to look at some countries in Europe, Japan or the United States to see how they are adjusting the figure of Business Angels for years now. We started walking and that is already a reason to go to work and support from our investment firms to entrepreneurs present their new projects.He had still to be published a week ago (took 2 weeks too crazy, and I could not catch up) this podium that was published on February 14 in the Mercantil Valenciano. I think it reflects my opinion on Private Equity in Spain, but eye in a very similar is the subject of private investors. You can download it in pdf from here little capital, no risk
The country had no angels I mean Business Angels. The more accurate translation of this could be anglicized "angel investors" and are usually in Spain, angels, and sometimes even also investors. Not long ago, one of the most recognized Business Angels sector of technology and innovation I confessed: "My range of investment is up, making an effort, 200.000Euros. At a recent meeting we had of Business Angels in Switzerland, many European private investor confessed that his investment range was up to 2 or 3 million Euros, something impossible to extrapolate to Spain, where the financial capacity does not currently exist ". In Spain, almost all new businesses in the technology sector, require an initial funding of close to 400,000 euros, the first step is generally to use the classic 3 F (Friends, Family and Fools). After studying these possibilities "nearby" resources and the doors to the call are exhausted with astonishing rapidity. Of all the new business ventures in the technology sector, only 30% achieved a poor pass this first hurdle, the rest, 70% of projects that generate employment and wealth remain forgotten expecting a financing option. Securing funding close to 400,000 EUR has always been difficult, but it is more difficult to understand because the crisis does not affect the achievement of funding today. A few months ago there was money for a few, and you as an entrepreneur were not among them, now joy! We are one of the few cases in which the situation has worsened with the crisis, we like, no money for your project. In Spain there is a problem of real structure, the figure of the Business Angels and there is virtually societies traditional venture capital is in our country of "Capital" justito and "Risk" little or nothing. Currently these companies only support projects clearly winners and rarely attend investments below € 1 million. The result, a no man's land, they would have to pay for him to be watered Business Angels eager to support the launch of these companies with investment ranges near the 300,000 or 400.000Euros. In fairness it should also be noted that there are few real angels, and entering and leaving the area frequently. In fact I would say that the figure of the professional individual investor is almost nonexistent and the few who are studying, supporting and sticking up for this sector are mostly successful entrepreneurs. These case studies were small entrepreneurs in the late 90s, who have made money over the years and like to do what no one did for them; gamble and invest in young companies, look at the face of an entrepreneur, believe in their project and accompany him on the road, often trying to provide not only value but also capitalizing and not just looking for a high return over the medium to long term, they like what they do and for them is a great profession, but I insist, are few and could tell fairly quickly, too quickly. ever Spanish administration has encouraged the Business Angel figure. It's a shame because it is a key figure in the promotion of innovation in Spain. In our country, only 5% of new internet businesses survive their first year of life. This cruel natural selection is essential figure not only a financial investor such as a bank or a credit of the ICO, but a true mentor, usually to provide not only funding but also, experience, know-how and advice from a person that as he has been through his own concerns. Unfortunately the few who act right now are a little daring and a lot of romance. The work of these investors is unregulated, has no definite taxation and has not the slightest institutional support or even with defined rules of the game. Possibly for this reason, when you go out and walk on the street, outside of some very specific sectors of entrepreneurs, people do not know it, nor representing it means to be a business angel. A few weeks ago, on May 19 CIU spokesman, Josep Antoni Duran Lleida and presented at the Congress of Deputies a proposition of law for the regulation, empowerment and recognition of the figure of the Business Angels in Spain. It details the role that individual investors have in SMEs and microenterprises. In the reasoning of writing, it is seen that if the funding in Spain traditionally has been the main obstacle to the growth of innovation-based companies, at present, in which banks refuse systematically to bet on these businesses is essential to regulate and enhance the figure of the Business Angel as the backbone of projects related to technology and innovation. It reminds the Government that there is no tax advantages for these investments, generally ranges between 25,000 to 300,000 Euros, contrary as it does with venture capital, and emphasizes that the development, regulation and promotion of these has been key investors in the surrounding countries in the development of innovation projects. finally urges the Government from Congress to work on three key lines: - Regular Figure of Business Angels - Establish stable partnerships with networks of Business Angels from the public. - Regular and encourage tax-advantaged investments are applying them to natural and legal figures. Following the mandate of Parliament the ball is on the roof of our Government. They are now responsible for implementing stimulus measures that are the true seed of the appearance of these figures and supporting private enterprise and SMEs from a very early stage. Motives for optimism? They have taken the first steps and we just have to look at other European countries (France, Germany, Switzerland ...), Japan and the U.S. to see how it is regulating the figure of Business Angels, for years now. In Spain, at least, started walking and that is already a reason to go to work and support from our investment companies to entrepreneurs who show us their new projects.I have a few days like writing for money and € ro din may seem the same, but it is not. A few days ago an entrepreneur at whose blog I follow and recommend, Jaime Estévez , commented on a post of this blog, I do not invest in your project , a very interesting thing and I hope he has developed in his, "The reasons why you do not want your money. " I have been fortunate in my dual role as an investor and entrepreneur being my own investment in times needed. That's a bargain. There have been many entrepreneurs were valid, with good equipment and good projects that have fallen by the wayside because the financial partner was not to be. It is very important, especially in the early stages of the project when financial needs are limited by the funds go, no more (tempting) or less, but valuing and allowing you to choose who brings the money. The entrepreneur should - yes, it is sometimes utopian-to elect their first investors.'re talking about early stages, the long term if the project grows and continues, not only you will not have that luxury to start, but also the money becomes impersonal.
What is the money is gasoline, is a necessary evil. It is early afternoon something you need but you should not dump all your efforts on getting. But it comes with added value comes with the know how. If you are seeking money in a business angel sector will have to refuel the gas, but to look out at the gas station as it will be the added value and the key that will open many doors and will earn you a long time. - Career: get going, you're not standing 6 months because no funding. There are a thousand and one thing you can possibly be doing in those months: test, development, create a corporate structure, a team ... Seize the opportunity cost, save time, internet is a sector immediately, do not create a power point "Now for the pasta "because if you go and see an investor that's what you've done, not going to believe in you as an entrepreneur. - Invest: We must sweat shirt, literally. Do not come with an investment of € 0 xxx.xxx without asking me anything you've invested. On your way you convey that you believe in the project and that you, within your financial capacity has invested in it. For me it is much more valuable the entrepreneur who has invested some of his savings, or has requested a loan for the project. You can not expect others to put the money, you have to be the first to get wet if you want to believe in you. - Select: Not all business angels, investors in general and Venture Capital Funds and Family Office are for everyone. Ask yourself stages, especially put your focus on profiles of people, not all money is the same! Personally it is best to start with an investment of one or several Business Angels sector, you will be able to help not only grow, but with its know-how, networking and synergies with other projects to be able to shoot the project. If you do not care what contribution that capital venture capital (early stage impossible), a family office or a business angel, you have a problem, are things that have nothing to do, all useful and valid and all directed to a project different time. - Allow yourself a treat: You should not accept the first proposal of investment that you get. The goal is not to get money, get to raise money is a necessary evil for the sake of the project, allow or reject profiles abusive conditions are not ideal and do not add value to your idea or company. So what is the din € ro? - The din € ro is money but way, dizzying yes, but no more value. A petrol fueling like crazy and then "goodbye Lucas", come back soon, to do well and bring revenues. That's not derogatory!, Are stages a project and if you need very far. - In the phases in which to trigger the growth of a mature project, need € ro din like crazy, even internationally. Rate It purely as a financial investment, is another selection criterion, are purely financial transactions. - Do not be intimidated by the money. Money is often arrogant and intimidating sometimes. Chest out and take off that pressure, avoid bad times. A couple of years an average company that wanted to buy one of my companies, which ultimately did not sell, the food-gathering began to end in a deal with a "we have 500 million euros for acquisitions in the sector." Laugh, tell the truth "just have that; din € ro and that I have many, not just you." Take the pressure if you're at that stage and especially if you are looking for, that they might have them. Que no te pierda el pensarlo, mantén la cabeza fría no te vuelvas loco y no pidas ni cojas más de lo que necesitas; en ocasiones, eso pierde al emprendedor y siempre termina arrepintiéndose.
The blog of Alejandro Suarez.