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Startups: exam table before a round of investors

It is a cloudy and cold morning in the Buenos Aires neighborhood of Palermo. An unprecedented competition in the technology-based entrepreneurship sector is getting ready to start in the corporate building of Wayra, Telefónica’s startup accelerator. The host, along with six other investment funds specialized in these types of projects, will listen over several hours to a group of entrepreneurs who, in 15 minutes each, will try to convince them that their business plan is the best to get a joint investment of up to US $ 4 million, so far never seen in Argentina, for the number of players that join to do so.

Minutes past 9, around a well-attended table with different proposals for breakfast, the representatives of the funds are located: Wayra, NXTP Ventures, Alaya Capital Partners, YPF Ventures, Jaguar Ventures, Meli Fund and Draper Cygnus Venture Capital.

The room is small enough to intimidate even the most confident of the applicants. Between the jury and who exposes there are centimeters of distance. The first participant enters: Santiago González Venzano, founding director of S4, an developing company that allows agricultural producers to monitor crop health, soil quality and climate.

“There is a great climatic problem, which today is totally accepted,” González Venzano opens his exhibition. “There was an increase in frequency of both floods and droughts. The impact on food production is getting worse”. He adds: “The insurance industry did not take note of the occurrence of these effects: it is a conservative industry, which only has a policy for hail cases, which is the same 50 years ago and did not introduce any changes”.

The jury’s first question immediately appears: what is the business model like? “The product is sold in the Futures markets of Rosario (Rofex) and in the Term Market of Buenos Aires (Matba). We calculate parameters, Rofex and Matba publish them, and producers can buy their coverage in banks or suppliers of inputs for the activity”.

Less condescending, another jury asks: Why do they ask for more money? What did they fail? “We don’t fail,” says González Venzano. “We started in Argentina, but we already moved to Uruguay and Brazil. The development of Brazil is not cheap, from the data infrastructure to the commercial one. We do not see companies that are doing the same as us, but we believe there are potential competitors; there are players that are starting to move and we want to go fast, so we want to make more investments than we did”.

The time is consumed. Outside the other competitors review the letter of their “pitching” and walk along a narrow corridor where glances, nervous smiles and good luck wishes intersect.

It is the turn of the second participant, Nicolás Galarza, executive director of Quiena Inversiones, an investment consultancy based on local software that allows funds to be placed in international financial markets.

“We make it possible for people to invest their savings in places like Wall Street, or have access to other global markets,” explains Galarza, who points out that Quiena uses “algorithms to calculate the best investment”.

Issues numbers to show the potential of your venture: “In the United States, 54% of the population invests; in Latin America, 1.5%; and in Argentina, 0.9%, which places its savings in a fixed term, in a savings bank or buys dollars ”, and underlines:“ We offer to any saver the same service that the brokerage houses provide to rich: we generate a personal investment plan, with stocks, bonds, real estate products and commodities from around the world”.

The jury’s first concern comes: What are people interested in investing in assets outside of Argentina? “People want to know what to invest, how much and how to do it. Those are the three basic questions they ask. And our job is to make that easy, fast and safe. In the last two years of our venture, it closed just 7% of the accounts opened by savers”.

How do you plan a person’s investment? Asks another jury. “We provide a wealth advisory service for small accounts. We ask people how much they want to get, ”says Galarza. “We put together a portfolio in dollars that beats inflation and we start from there. Today we have 2,000 active clients with investments that average around US $ 4,000”.

While an exhibitor leaves and the next one is prepared, jurors not only take advantage of coffee, croissants, juice or sandwiches. They review the notes taken and exchange queries about what they think about what they have seen so far.

Now Juan Pablo Villani, founder and director of Brandktrack, a musicalization service for commercial premises from the development of an application based on artificial intelligence is accommodated.

“Through technology we can make music not a passive element but a stimulator of sales. Music influences us emotionally, it is the main emotional influencer of a store, ”says Villani, who points out through graphics that music“ influences the time spent and influences sales: more than 40% of the people who give them I like a store’s songs, it stays longer”.

The Brandtrack team, headed by Juan Pablo Villani (top left). Photo: Juan Manuel Foglia.

The first question comes almost by cutting the auction: How do they sell? “We sell only to companies. It is a super cheap subscription service, of $ 19 per month per store. We cover the legal part of the business, which has to do with music rights and even commercial notices, because they can be included in the midst of music. ” Another jury wants to know if the company has projection outside Argentina. Did any brand take them to another country? “Yes, Mc Donald’s took us to Guatemala. In that country the experience of the Happy Box began, it is a place that they use as a test platform. And they also took us to Nicaragua, Honduras and El Salvador”.

Another executive is more interested in learning about the evolution of the startup. Where were they a year ago? “We had about 160 customers and just over 2,000 commercial stores. Today those numbers doubled and we have 335 customers and 5,000 stores”.

It is the turn of Angelo Antonelli, executive director and co-founder of Apperto, an application to “make the most of living” in small cities. “Those who live in small cities know about the lack of service applications”, he says, and describes the potential market. “47% of people in Latin America live in cities with fewer than 500,000 inhabitants, and there are more than 3,000 cities of this type in the region”. He adds: “We have 11,000 users that operate on average about $ 3 million per month.” And what is your strategy ?, shoot one of the jurors. “We want to reach these interior communities where there is no delivery per app and they still have the magnet stuck in the refrigerator to call by phone. We want to arrive and digitize them”.


Also published on Medium.

Published inStartups

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