Taking the first steps in the entrepreneurial ecosystem can be daunting – the lingo, the fast pace, the new technologies. But worry not, we have a handy guide for any non-entrepreneur about what they need to know to navigate #LIS and what can they take advantage of.
What is #LIS?
Lisbon Investment Summit is an a surprisingly informal and slightly unexpected startup conference. The motto of the event? #nobullshit. That means business. During these two days, #LIS will promote thought-provoking conversations, will join at the table the most disruptive innovators and the most seasoned investors, and completely change the way you think about your business.
Get to know the lingo
If you want to blend in, you need to dominate the lingo. This is important to make sure you understand where each other attendee is coming from – a startup in the seed stage or raising a series B are not in the same position – which means they also have different things they can offer and are looking for different things. It’s easier than it sounds – we made a little dictionary of what you need to know – find them here and here.
Inspiring Talks
At #LIS you will get access to thought-provoking keynotes, given by world-renowned speakers. That is the case of the #LIS headliner, Andrew Kween, best-selling author of “How To Fix the Future”, who will speak about the dangers of a digital world and how can we overcome them. Maybe some of the talks about disruption will be a bit scary – especially if they fit your sector – but take the chance to be open to learn what chances are taking place – and how to take advantage of them. Check out the agenda of talks here.
Workshops
The workshop stage powered by Google, is the perfect place for you to learn new ways of doing things, from tools to digitize your business, to identifying business opportunities – get your hands ”dirty” in innovation.
Pitch Competition
The pitch competition is where up-and-coming startups (previously selected by the LIS team) pitch on stage to a crowd of angel investors and corporate venture capitalists, looking for investment or new clients. Why should you watch the live pitches? Well, for one, any of these startups could be disrupting your business, so you should keep an eye on them. But also, their new technologies might bring incredible advantages to your business – and they will most likely be open to partnerships, so take the opportunity to get to know them.
Unexpected Side Events
One of the best things at #LIS are its side events. Sure there are spectacularly fun parties, but it’s the unexpected that makes it fun, like in Dinner With a Stranger – you just have to sign-up and get selected to meet a curated group of people in a fabulous Lisbon restaurant. You never know who could meet – maybe your next business partner, maybe someone who inspires you to venture into your own business idea. We promise you one thing – it will be memorable. Wait no more – get your tickets to #LIS19 here.
The morning dawned rainy in Lisbon – the kind that makes you wanna stay on the sofa all morning, but for our Lisbon Challenge teams that was not an option – they just got to the busiest part of the challenge.
Lisbon Challenge wraps up today its Product Phase. After Validation Phase – where the teams worked on improving their understanding of the problem they are trying to solve and (re)validating their customers (how they feel, interact and behave around this problem in the) – they started Product Phase, where they went on to work through how their products deliver the benefits that solve those problems.
Turning Pains into Gains
The product phase focuses solely on the startup’s solution. Are they delivering the benefits their customers require? It’s all about taking the pains identified during validation phase and the benefits that solve them and turning them into product features that deliver what the customers want.
But more than just features (and having the right features), it’s about understanding and building a journey through the product that takes them straight to core value.
Taking a page from Andrew Chen’s Engagement Wall and “next feature fallacy”, the teams focus on understanding what is working and why, and also what they should just stop doing, instead of just building new things. So, it’s about weeding out the unnecessary stuff and getting as close as possible to the #nobullshit product that makes users fall in love with it.
A Mentorship Driven Program
As their Lisbon Challenge journey takes them closer and closer to a product-market fit, the teams are lucky to have a strong network of mentors, who have been through the same processes and similar experiences as entrepreneurs themselves. They stepped up to the challenge to give serious, honest and helpful feedback to our teams.
Rita Ribeiro da Silva, from SKOACH, detailed the challenges of the phase:
This has been, so far, the most challenging phase. The problem with creating a product is that there are many opportunities and you have to decide on what exactly do you want to choose, and where you want to focus. And the temptations are huge, and sometimes it’s hard to keep the focus on creating a product that is focused and having a focused message of what it is. It’s hard to keep it simple.
The team, who is tackling the challenge of high employee turnover with a solution that enables high-performing teams through gamified change of individual behavior, has taken full advantage of the mentors’ advice:
“I would say that the best advice has been from people who have used products that have tried to solve the same problem, and we’ve got some feedback about the pitfalls, the mistakes that they made, and that’s helpful so we don’t… do them (laughs)”, completed João Ferreira, also from Skoach.
What’s next
Next up, the teams will focus on finding the right metrics, messaging and channels for their product. But for now, we celebrate the end of the phase and the great group of mentors that imparted some of their knowledge and experience, with the incredible Beta-i community experience – this time delivered through the feature of brazilian-style-mouth-watering-BBQ.
Marvin Liao worked at Yahoo! for 10 years and has been investing for 5 years in one of the top Silicon Valley VCs, 500 Startups. With Observador he talked about unicorns, Trump and the Portuguese.
He was an executive at Yahoo! for more than 10 years and he’s a partner and investor in 500 Startups, one of Silicon Valley’s leading accelerators and venture capital firms, since 2014. Marvin Liao spoke with Observador as he was passing through Romania, in a video call that goes from “unicorns [companies valued at more than one billion dollars] without real business models,” a bubble that will burst and not only in the technology industry, to the Portuguese and the Lisbon ecosystem, but also Trump, Facebook and data protection. “I see a lot of money going into very bad deals and I do not understand that. I do not understand the evaluations that many of the companies in a more advanced state have”, he said.
Marvin Liao is scheduled to come to Lisbon in June, where he will once again participate in the Lisbon Investment Summit, a two-day event organized by Beta-ithat brings together investors and startups from around the world. Marvin knows what he will find: an ecosystem “richer than it was in the past,” with “mature” companies and that is “unbelievably friendly for startups.” But he does not fail to point the finger at what he considers to be the problems of the Portuguese: “work ethics,” “lack of sense of urgency” and ambition. Marvin Liao accompanies and is part of the boards of directors of several portfolio projects of 500 Startups, which includes the Portuguese Talkdesk, and invests mainly in projects in the area of digital media, marketing cloud, e-commerce and mobile platforms.
Mentor on a number of acceleration programs in Europe, Israel and the United States, Marvin says that what he is most looking for in the startups he invests in is “founders with great ambitions, such as Tiago [Paiva] from Talkdesk.” For five years he has been investing in 500 Startups, a very early startup venture capital fund that has invested in more than 2,200 companies in 74 countries. On 6 and 7 June, it will be present at the Lisbon Investment Summit, one of the main events of entrepreneurship that last year included more than 600 startups, 200 investors, 100 speakers and 400 companies from more than 50 countries.
You said in an interview with Beta-i in 2017 that there was “a lot of bullshit product worship.” Are we still at this stage or have we moved on to another cult?
There are so many cults, aren’t there? I think you still feel it [this cult], especially in Europe. I often talk about marketing and sales and still think they are undervalued areas. But this also depends on the ecosystem we are talking about. Sales and marketing are still very, very devalued in Europe in general, and not so much in the USA. But they are also still undervalued in the north-american market.
You also said that in recent years there was a lot of money channeled into the ecosystem and that there were projects that should not even have received investment. What startups were these?
I have spoken in general and there is still a lot of money in the ecosystem. Let me give you the North American market as an example: in the US, at the earliest stage of startups, the seed, it doesn’t circulate much money in the ecosystem, but when you look at what happens in later stages, in growth, the reality is that you have a series of unicorns, which I can not understand. Many of these unicorns do not even have a real business model, do not even have good economic indicators and are even overinvested. This makes no sense to businesses. I think there is a lot of money to flood these companies because the capital markets are very volatile and companies prefer to remain private rather than submit to the reality of the exchanges.
These companies are valued at multi-million dollar values, not because they are worth that, but rather because investors have nowhere to allocate money?
I think that is a big part of it. But it is also true that money has become a commodity for many investors and I think this theme gets into a bigger talk about the economy. What is happening is that since interest rates are so low, there is a lot of money being channeled to private equity and the startup ecosystem, in a hunt for returns – the returns that we cannot reach in other markets. If you think of asset classes from a macro-economic perspective, such as commodities or currencies … I also think that innovation – like technology, venture capital – is one of the biggest assets and, even though a lot of money has been channeled there, it remains a very, very small asset.
We’re still in a bubble, then. Do you agree?
Yes, I really think we’re in a bubble, but I do not think it’s just a technological bubble. There is a bubble in all asset classes. If you look at the valuations of all companies, even the ones that are listed in the markets, you realize that they are growing. There is so much demand for returns everywhere that to me, everything is a bubble.
And when is it going to bust? Because it’s going to burst, isn’t it?
Yes. And it’s going to be brutal and bad. I hope we have at least another year or two to get as much money as we can because I think it’s going to be really ugly.
Can it happen in two years?
It is hard to say. That’s the trillion dollar issue. If I knew, we probably would not be having this conversation here, I would have been retired on the beach. I do not know, but the reality is that there is still a lot of money available, there is still a lot of money that is looking for returns and I question the structures of many businesses. Many countries, many companies in general. It is a concern. So it’s going to bust sometime, yeah. I do not know if it’s going to be a year or a week from now, because if we think about it, the economy is very cyclical… And we’ve been recovering since 2010, I think it’s the period that has lasted the most, around 8 years. It’s a long time.
Will the side effects of this bubble be worse than the ones we experienced after Lehman Brothers bankruptcy?
What’s interesting about this is that we look a lot at the 500 companies [the S&P index] and realize that they are very well capitalized. I think business is not growing, but they’re sitting on lots of money and that’s interesting. I think what is happening, at least in the US market, is that we have very low interest rates and, although we do not like our government these days, the truth is that it has been very friendly to companies, has made many changes and when you look at the North American market it is perceived to be very robust. But when you talk to people and when you read the news everyone seems to be very convinced that a great recession or depression will come very soon.
What I think is that, as a general rule, the consensus among people is wrong, so part of me… I look at the signs and I perceive that they are bad, but I also question myself… Because there is a school of thought that says that when you believe that one thing will happen, it happens, but there is another that says that when everyone believes that something is going to happen, it begins to move in another direction to avoid it and it does not happen. There is a reflection of volatility about this. So it may not be as bad as people judge. I do not know.
You’re divided.
Yes, but I worry from a macroeconomic point of view. I see a lot of money going into very bad deals and I do not understand it.
What bad deals are these?
I do not understand the assessments that many of the companies in a more advanced state have.
Can you give me examples?
The problem is with many of the unicorns we’ve talked about. But I also have to be careful here because they all have, in their pool of investors, a lot of friends of mine and I do not want to make enemies [laughs]. Many venture capitalists invested, in my opinion, in overvalued companies.
You spoke of the current US government. What were the most significant changes to the startup and technology community made by the Trump administration?
I do not know if any. Trump is not a fan of the [US West Coast], and as you know, Silicon Valley and all of California in general, is very anti-Trump and so… If you think about all the policies he’s promoted, like anti-immigration, you realize that they are a threat to technology as a whole. But on the other hand, there are other company friendly moves who have allowed a series of mergers and acquisitions, and tax changes have benefited many large corporations overall.
Is not this related to the protectionism that Trump wants for the American economy?
In some respects. I am not sure that the Trump administration has so many political strategies, but one we are going to see without a doubt is the commercial war against China. And one of the few things I agree with: the Chinese government’s economic policy has not necessarily been good for Americans or anyone. It is something that has been happening for a long time and nobody faces them. That part I even understand, but I do not like anything else.
What dangers are facing the startups ecosystem now?
There has been a great change in the way we see things. Today, one looks at Facebook, at Google and it is realized that there is a retaliation against technology in general, particularly in the US, but I think everywhere. I also think the flood of money in Silicon Valley is very negative overall for the culture. And this is a kind of bubble in San Francisco. And it’s very negative. I think almost all of us have been operating in a bubble for a long time … I think there are a lot of Ubers in technology in general, and that the uberization bubble has already burst. Now, we are beginning to realize that technology is a force of good, but that it can also be a force of evil. In the Bay Area, there was a bubble that blinded us to many of the negative things technology has brought.
He spoke on Facebook, which since the Cambridge Analytica bust has been involved in several scandals and now wants to be a platform more focused on privacy. Will you get to that point?
I think they will. They are super smart, have lots of money and lots of resources to move in that direction. Honestly, they are learning a lot from China. Look at WeChat, which has everything combined in one app. I think they are going to move in that direction, they are very well positioned and they have very intelligent people working in the company. The reality is that you look at them and you do not believe they behave in a certain way, but when you start thinking about Facebook as an ecosystem … I use it every day, whether you like it or not. I do not know how the younger generations are looking at Facebook, but I think it’s well positioned. Many young girls use Instagram and WhatsApp.
Is Facebook becoming the WeChat of the West?
Yes, I think so. I think WeChat is doing very well and it makes sense.
But that would mean that they would have control and monopoly on so many things … Is not it troubling to have so much data in one company?
Yes, but Google also has all this data and Amazon too. There is a great book I recommend to everyone in the world, Data and Goliath: The Hidden Battles to Collect Your Data and Control Your World” [Bruce Schneier], this is already happening. Nor do we need to start talking about what governments already know about us. Yes, we should have worried, but this has already happened. It’s not happening, it’s already happened.
And should we just accept? What should we do?
I think we should be using VPN more often, we need to be very careful with what we put online. The truth is that many of them already have this information. It’s a scary world and I think there will be retaliation from people.
He said that the uberization bubble burst. What about social networks?
No, I think social networks have become useful. All people use them, it’s like the air you breathe, so I do not know if they’ll ever end. The truth is that if we think about them a lot we realize that they are basically the online version of something that is very similar to what we already did. Of course we already want to socialize, but the difference is that on Facebook we do it virtually and if we look at Twitter …. All of these are reflections of things that humans naturally do. If it is Facebook that will be in the future it is difficult to say, but there will be something, some platform.
What are the new trends now? What are you looking for in your investments?
I still look at many things like cloud or software as a service, because I think all this is still very early on. It may have been available for about 20 years, but if you think about how many people use this software, we realize it’s a relatively low number. I also look a lot at biotechnology, digital health.
Has the new European data protection regulation been a good measure or is it a barrier?
It’s a mixture of the two. There is a scary level of lack of privacy. I think the backbone is very good, but I think it also has other unintended consequences. It will make small business life harder. The only companies that will be able to comply with the RGPD are the big ones. The big advantage is in companies that have money and resources, but it’s going to be a big challenge for startups. All laws begin with good intentions, but there are also many unintended consequences. One is that ironically this will only help the big ones.
Is Europe still very different from the North America?
I do not know if the US is an example. There are many wonderful things and other horrible things: we have a health system of trickery and teaching health too. I’m not sure if we’ll be an example. But I also do not know if Europe will be. Europe also has havoc. There is damage everywhere. I am not sure that any country has discovered the formula.
You’ve been to Lisbon a few times. Have you seen differences in the ecosystem?
Yes, no doubt he is now richer than he was in the past. We’ve seen a lot of mature companies roll out B-Series and C-series investment rounds, and if you do, Talkdesk is doing very well. It is one of the companies in our portfolio and it is incredible. We start to see some companies like this and also the maturity of the ecosystem in general … I think this is good and they have an ecosystem incredibly friendly to startups.
And what do we do wrong?
There is still an ethical problem at work. I do not think it is as serious as in other parts of Europe. Portugal is still very interesting, I like the ecosystem, but I do not think people work what they need to work. Maybe that’s my American side talking about, but I think that work ethics is a problem and that there is still a sense of urgency.
Do the Portuguese lack a sense of urgency?
I think it’s still a problem. And I also think companies are not thinking as big as they should and have examples, like Talkdesk. Talkdesk should be a model for Portuguese companies – big ambitions, big ones – and I still do not see them.
Is Talkdesk different because it benefits from being in the US right from the start?
I think it helps, but half of the team is in Lisbon and another half in the USA. I think this should be the model of the future.
Having events like the Web Summit is important for Lisbon if affirming itself as a hotspot of the technological community in Europe?
Yes, I think it helps. These events are a good way to galvanize the community and bring new things. I think the Web Summit is very good for Portugal as a technological ecosystem, especially because of all the new contacts: new investors and new startups that are now in Portugal. For the country, I think it was money well spent. It was a good investment and has been very useful for Portugal.
What is most important to you when investing?
Involved in a very early stage – the seed and the pre-seed – and as a rule I like to see a product working already, some initial data on the consumers. And I like to see founders with great ambitions, like Tiago [Paiva] from Talkdesk. I’m looking for people like Tiago.
Is the secret always in the founders?
At this stage of the companies yes, in other states, later on, it is very different.
Has 500 Startups already recovered from the sexual harassment scandal involving former CEO Dave McClure?
This has happened for over a year and a half. We are a very different company now, but the truth is that Dave was just one of the co-founders, he was not so involved in the day to day. I think we have recovered, yes, we are raising our fifth fund now, we continued to invest in our portfolio and we continued on. I do not know if there is such a big change in the culture of the company, because the truth is that as an organization we have done nothing wrong. Personally, I’m very upset about everything that happened and also for being found guilty of something that neither I nor my team did.
But Dave’s case was revealed at a time when there were other cases on Uber, Google, etc.
I think many of the things that happened were terrible and that people should be punished for it. This forced that there was more perception on this subject and a cultural change. If you look at many of the venture capital funds, all the big ones have a woman in the right direction now. I am not saying that the problems have all been solved, I am saying that now we see that there is a greater perception about this and that there has been a cultural change happening in the last two years. If you look at all the scandals that happened in Hollywood on Wall Street, I do not think that has caused these industries to change.
I know you’re addicted to buying books. What book would you recommend to Portuguese entrepreneurs?
Gil Dibner, Founder and Managing Partner at Angular Ventures, has been confirmed as a speaker on Lisbon Investment Summit, happening on the 6th and 7th of June in sunny Lisbon.
The first time Gil came to Lisbon Investment Summit was a random accident, but a fortuitous one: he ended up meeting a founder of a company that became an angel investment. “I hope it’s the first of many” he added.
For startups hoping to get this type of luck and casually meet an investor at #LIS, or startups applying to compete on stage at the pitch competition, Gil suggests they think global: “Remember that every stage is a global stage. There really is no such thing as a “local” startup or startup hub.”
Thinking global is also one of the reasons Gil believes are in the growth of Lisbon as a startup hub, able to attract investment from around the world:
It’s increasingly clear that technology is a global business – and that great innovation can come from anywhere. It’s also clear that Lisbon has a strong and growing track record of producing companies with global significance.
Gil Dibner will be at Lisbon Investment Summit, an informal event that gathers the most innovative startups, seasoned investors and daring corporate innovators, happening in Lisbon on June 6th and 7th. Get tickets here.
When your startup is looking for investment there are a lot of things you should consider. We break down the steps to take to meet investors the right way.
1. Look for the Right Investors
This is easily the most important part of the process. If all you need is money, then a bank is the easiest way to go. If you’re looking for an investor that means you’re looking for a long-term business partner. When looking for investors, take the time to consider what kind of investor you are looking for:
Sector: Are you looking for an investor that focuses on your particular sector of business?
Investment patterns: What type of investments does the investor usually make? Seed, or series A/B? Does it match the phase your startup is in, or what you’re looking in the future?
Region: Are you a global startup, or are you focusing on a region? Is the investor also focused on a particular region?
Are you looking for someone with experience and contacts in a particular sector that you want to reach?
This will help you have a better understanding of what kind of investor you’ll need and how do you know if you’re a match.
2. Do some healthy stalking
After you considered and defined all the point in the previous step, it’s time to look for people who fit your criteria and preferences. Don’t be lazy and do your research! Do not approach investors randomly – research their past ventures and investment portfolio, and try to understand if they are a good fit with your company.
Approach leaders and connections within the sector you’re working on and ask for recommendations.
3. Network
This one is pretty simple – to meet investors you need to be where they are! Join the same events, participate in roundtables and join conversations about the industry.
Certain events, like the Lisbon Investment Summit, happening in Lisbon on June 5-6th, are the perfect setting to join discussions and meet the right people.
Don’t forget the 6 degrees of separation – meet as many people as you can and engage in conversations with them. You might meet someone who can introduce you to an investor that might be a great match.
4. Be considerate of the person
Most investors won’t take cold emails, so make sure to get an introduction within your network. Also, don’t spring your business plan on them – take the time to get to know them and understand what they usually work on and what are they looking for at the time. Make you sure you are bringing something valuable to the table.
5. Build a relationship
Let’s be real: no one invests in a complete stranger. You have to understand that an investor is investing as much in you as in the business. So make sure to let them know you are a reliable person, who accomplishes what he sets out to do. After initial contact, if there’s interest, keep them posted on your work and the results of the business.
Keep joining the conversations the sector is having and show that you are an expert in what you do.
In the end, it’s important to realize that there must be a match between the interests and goals of the entrepreneur and the investor. Don’t be shy to say what you want from them (mentorship? introductions?), and what you can offer in return. None of you should ask for something they’re not willing to bring themselves – it should be an equal partnership that is mutually beneficial.
