No Filter Talks - 'The Key Elements of a Successful Start-up' - Interview with Aurelia Ventures
We believe that experience is one of the greatest teachers and sharing it can be an incredible resource for any business around the world at the beginning of its journey.
That is why we created the interviews series ‘No Filter Talks’ where we can find out the right insights directly from the allocators, gatekeepers, bridge builders and innovation endorsers.
In our first interview we explore together with Felix Kues - Chief Executive Officer & Co-founder and Alessio Zazzarini - Chief Growth Officer & Co-founder from Aurelia Ventures what are the key elements of a successful start-up.
1.Can you tell us a little bit about your background and experience.
Felix Kues: My background is in technology start-ups and management. I have worked with start-ups in different parts of the world such as Latin America, India, Indonesia, the Middle East, Hong-Kong, Singapore. I went through accelerators with my own start-ups and always had the impression that they are not always really personal. There needs to be a better model to help start-ups. Additionally, my background is in business, strategy and innovation.
Alessio: I am a psychologist and I am in love with User Experience. Most of my life gravitated around collecting data and translating this data into a product to help companies improve their business. During my journey, I worked with many start-up companies but also with mature corporations like Warner Bros, American Express and Carrefour. I have also worked for Trivago to create their UX research team which was quite interesting as Trivago at that moment was a start-up in the growth stage and I worked with them during this whole growth stage when they grew from 500 employees to over 1,400 employees and eventually they went public. It was interesting and constructive working with the C-Level executives during this period.
After working in this UX position for 5 years, I started traveling and I have met Felix and we discovered that we have different backgrounds and we are quite complementary to each other.
2.We believe that experience is the greatest teacher so what are the key lessons that you’ve learned working in this ecosystem?
Alessio: Around 12 years ago I started my first start-up. It was when Facebook Pages started to become really popular. We wanted to help companies to sell via their FB pages. We created a team, we tried and we failed. Why? The idea was great but there wasn’t execution. The biggest lesson for me is that execution is very important and it is not only the idea that matters.
Felix: Entrepreneurship is happening all over the world. It is not only happening in Silicon Valley. One thing is that companies find ways to adjust to the current situation.
3.How would you describe your accelerator? What’s your secret sauce?
Felix: We are very hands-on, have deep empathy for our start-ups and their challenges and connect them to our community of technology entrepreneurs that help them to learn from each other and grow with each other. We went away from a classroom structure with fixed lectures everyone needs to attend to an organic structure which is based on each start-up’s respective challenges and milestones. That’s the secret sauce there because they get exactly what they need at that moment and what helps them the most to excel from a community that has done it before.
4.From your experience what are the key things that a successful start-up should have?
Felix: I believe that the first thing is team. Team is the most important thing.
Alessio: Team is the core. The founders are the core and it is super useful if they have already been through it (or have a network of hands-on advisors who has been through it and which guides them). This is one of the best predictors for the success of the start-up. If they already had a start-up or a business they know the game and there is a higher probability of success. If they are together because they only believe in ‘the dream’, they might make it, but 9 out 10 times they don’t.
The seven things we can agree on are: 1)team 2)experience 3)resourcefulness 4)determination 5) Innovation 6)Their ability to understand their capabilities and openness to external advice 7) Diversity
5.Under this current economic climate, what is your advice for companies looking to scale-up or raise capital?
Felix: I think that before raising, founders should evaluate if it is possible to reduce their existing expenses. That is one of the things that we do with our start-ups. We help them reduce costs, run ‘leaner’ and become more efficient. Raising capital takes a lot of time and it is a lot of effort. Many times it is easier to shave costs in your own company before you consider starting extensive fundraising efforts.
Even in the current climate, we see our companies raising. One of our companies has raised a seed round of $3M and another is raising from a major VC in Indonesia. I think it is important to be resourceful and run as capital efficient as possible. And in that way, you can scale anything. We have bootstrapped founders in the cohorts who have close to zero costs and building really amazing companies without any external capital injection. We see many companies that are bootstrapped with really experienced founders who know very smartly how to reduce costs and they are scaling massively.
6. Are there cultural differences between companies raising capital and VCs from around the world?
Alessio: What we have observed when raising capital that start-ups from the US have it somehow a bit easier. VCs from the US were more open to providing capital even without seeing revenue. So the companies in the US are having an easier time raising capital. The companies that we worked with, from Asia for example, have to work harder in order to show the VCs that they are having revenues and that they can go 10X very fast.
Felix: I would like to add that the US companies are more aggressive on how much they raise. A seed round of $3M, is a lot, especially during COVID19. As Alessio said not on a pitch deck but a well-developed MVP and a few enterprise commitments. Whereas in South-East Asia, VCs are more cautious. They need more commitment, trust, more proof and they see it more as a real estate investment than a high-risk start-up investment which it actually is and treat their investment decisions in the same way.
It is interesting to see how start-ups and VCs are operating around the world. We can see it with our program. US start-ups are quicker to join us because they are quicker at sizing on an opportunity. They are faster with a lot of things. I believe European and Asian founders are more cautious before taking decisions.
7. What do you think is more important for start-ups? Is it important to be really fast in taking decisions or being structured?
Felix: The US founders we work with are structured and fast, while still knowing that not everything must be 100% perfect. Probably, because they have people with experience onboard. They know that nothing has to be completely perfect from the beginning and are able to scale very quickly with this philosophy. As a contrast, we often see founders in East Asia and Southeast Asia who could be more agile and dynamic if they would be a bit less perfectionist and more open to risk. Especially under the great start-up frameworks, certain governments have created in the region (especially Singapore and Hong Kong) start-ups have an exceptional building ground to strive and scale technology start-ups. The infrastructure is there, but by being too cautious local founders sometimes don’t make full use of the created opportunities for start-ups.