What You Always Wanted to Know About Samaipata But Never Asked
April 13, 2018
One of the things that makes being a VC so fascinating is that big part of our job is to ask questions and learn from exceptional entrepreneurs. We also love founders who question us (please do, you should ask us as many questions, if not more, as we ask you), we are all about being transparent and straightforward. But we also know that fundraising is a time consuming and distracting business and it’s hard to access information on potential fit with VCs before you meet us. So, for the sake of transparency and efficiency, we are answering some of the more frequent questions we get from founders. We were born bold.
We hope this allows you to get to know us a bit better, saves you time and helps you to determine whether we are a good fit for you. In our own jargon, #letsdothis
1. What is Samaipata?
Samaipata is a founders´ fund investing in pre-seed/seed stage marketplaces and digital brands across Europe.
2. What do you mean when you say founders fund?
At Samaipata, we are a founder’s fund with an entrepreneurial skilled team. Our investment team has been in the trenches, has succeeded and failed in several ventures. Starting by our GPs. José, our founder and GP, co-founded La Nevera Roja, the largest food delivery marketplace in Spain, exited for $100m in 2015. Eduardo, our Chairman, co-founded Samaipata following Jose’s invite. He is also the Chairman of MasMovil (€2.3bn company in the communicator sector) and has been a Business Angels for 18 years. He launched his own tech start-up (B2B 3D sound system) in 2012 and sold it in 2014 to Dolby.
Feel free to ask us about our other less successful ventures when you meet us, each of us has got great learnings from trying (and failing) to get businesses off the ground. There´s an online marketplace connecting people with smartphones and the news outlets. A subscription bread company. And even a digital direct-to-consumer brand for pregnant women launched from a living room.
3. What do you mean when you say you are thematic?
We only invest in marketplaces and digital brands, across sectors. B2B and B2C.
4.. …And why is that?
First, because we strive to add value to the start-ups we invest in. In fact, we only invest in businesses we understand well and where we know we can add value. So we need to be experts and build a relevant network. And we believe we can´t be experts on everything (we wish we could be!), we need to be specialized. So, we are focusing on marketplaces and digital brands, two types of business models we know well as operators and investors.
Second, because as we invest in tech-enabled solutions, in the productization of tech, and tech becomes easier to replicate, we look for models with additional barriers of entry. Basically, we invest in defensibility. And network effects and the emotional connection that digital brands establish with their customers offer additional barriers of entry.
5. Do you invest in all kind of marketplaces?
Yes. We invest in businesses with network effects, in any sector. B2B or B2C. That includes SaaS enabled marketplaces.
6. What is a digital brand?
We see digital brands as any product, content or service that goes direct and establishes an emotional connection, a sense of belonging and community, with the end user.
We strongly believe in the power of technology to build new types of relationships with users. When a brand is built on top of it and an emotional connection with the user is established, that creates a powerful barrier of entry. Read more on our Customer Love Framework, i.e. how we define and analyze digital brands.
Please note that this doesn’t mean we only invest in B2C brands. We also invest in B2B(2P) (Business to Business to People, Aurore and I are particularly proud of this acronym!). Those would be brands that target employees, even if sold through the employer. Like Totem, one of our last investments (here more on our investment thesis)!
7. So, you invest in B2B businesses?
Yes, we do indeed. Our most recent investments include a B2B food marketplace and a B2B(2P) brand.
8. When you say pre-seed/seed, do you have any minimum revenue/product requirements to look at a business?
No, we don’t: we like to start building a relationship as early as idea-stage and can invest as soon as there are some signs of (very) early traction.
9. You only invest in Southern Europe, France and the UK?
Yes, in our first fund, we only invest in Southern Europe (Spain, Portugal and Italy), France and the UK. And we have offices in Madrid, Paris and London. Come visit us, our door is always open!
10. How big is the fund?
Samaipata Fund I is €30m.
11. What is your ticket size?
Our sweet spot when it comes to first tickets is EUR500k-EUR750k but we have done lower (EUR250k) and higher (EUR1m) checks. In total, we’re able to invest a maximum of EUR2.5m-EUR3m per company, including follow-ons.
12. Do you lead?
Yes, we like to lead but we are also happy to co-lead or follow, as we have done several times in the past, both with business angels and VCs. We believe that the better the people around the table, the better for the company, and the better for us. We are building a partnership together and it has to be win-win for all parties.
13. Do you have a minimum ownership stake?
No, we’re very flexible. Sweet spot is between 10% and 20% but — as per the above — we prioritize getting the right people in.
14. Do you always follow-on?
When we invest we do so with the intention of following-on on consequent rounds. An important way of how we add value to our startups is by helping them get to Series A and beyond, so we typically invest (over) prorrata in the immediate round after our investment and have significant participation in the following ones. We are proud to continue being the entrepreneur´s first call far beyond the initial funding rounds.
In the last 18 months our startups have raised a combined amount of +$150m (and growing!) in following rounds from top Tier 1 Series A and B VCs and we have always been there.
15. Do you always take a board seat?
Sometimes, but not always! We can take a board seat but not to be on the board is not a deal breaker for us. We have no ego when it comes to governance. We are hands-on and want to add value to the companies we invest in, whereas that means sitting on the board or not. Our job is to help the businesses grow.
Disclaimer: we are on call 24/7 but we don’t get into the day-to-day operations of the business, that´s founders´ territory.
16. How do you add value to your start-ups?
We like to think that our thematic approach allows us to support our portfolio companies in the following main ways:
- Strategy and execution — with our experience and expertise as operators and investors in marketplaces and digital brands. We also deploy our advisors to advise our start-ups on different fields such as BI (business intelligence) or B2B sales strategy
- Hiring — sourcing and interviewing candidates for our portfolio companies.
- Fundraising- getting to Series A and beyond leveraging on our strong network of top-tier later stage VC funds across Europe. Having offices in London, Paris and Madrid allows us to be insiders in the key European tech ecosystems.
- Business dev and internationalization — we have team members on the ground in every geography we cover and have built a relevant network in Spain, France and the UK to help our startups launch operations and acquire clients across Europe.
17. How is the team structured?
Our investment team is made up of Eduardo — our Chairman, co-founder and GP; José- co-founder and GP; Seb — leading Southern Europe and based in Madrid; Aurore — leading France and based in Paris; and myself — leading the UK and based in London. We have somebody on the ground on each of the geographies we operate in because we think that it’s important to be close to our founders, from deal sourcing to portfolio management, we want to be the go-to-person for them, we are on call 24/7. So we want to be where you are, an uber away. Might be that we are Mediterranean and love to meet face-to-face!
We also have a CFO, Pablo, who does a million things and participates in the investment process after the Term sheet is signed.
We also have an incredible set of advisors, successful entrepreneurs with different fields of expertise and always willing to help our start-ups.
18. Where does the name come from?
Samaipata is a word in Quechua, sama means to rest and pata elevated place/above, at the top/edge. Kind of the feeling you have when you build something amazing and get it over the line, like a start-up.
We know our name is hard to pronounce, but we are very proud of what it stands for. Samaipata is a little town in the middle Bolivia´s jungle, set in a valley around a big rock. It’s known for being a micro world, home to more than 25 nationalities that live in peace and harmony. You can read more about it here. It’s the ultimate example of diversity and team work, two values that are at the core of what we stand for.
If it helps you, breaking up the word makes it easy: Sama-i-pata. That’s how we pronounce it. But we love to hear the different versions people come up with, so keep them coming!
At Samaipata, we are always looking for ways to improve. Do not hesitate to send us your thoughts. We strive to partner with early-stage founders and to support them in taking their business to the next level. Check out more ways in which we can help here or for all our other content here
And as always, if you’re a European digital business founder looking for Seed funding, please send us your deck here or subscribe to our Quarterly updates here.
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