Silicon Valley Entrepreneurs – What you need to know

-Hi, welcome to H.I.G.H. Valley,
today I’ll interview two Argentine entrepreneurs, Alexis Garberis, co-founder and CEO of Eklec, a platform that allows companies to measure,
optimize, and learn lean management processes in an automated way. And my other guest is Sergio Smirnoff, founder
and CEO of Redlines, a networking platform that allows sharing contact information easily and
quickly from one phone to the other. Hi Sergio, hi Alexis. Thank you very much
for being here. How are you both doing? -Hi, how’s it going? Thank you for having us. -Very well, great, thank you.
It’s truly a pleasure to be here with you and Alexis. -Alexis, tell us a bit about how you became
an entrepreneur in Silicon Valley. Have you always been one entrepreneur? -Well, the answer is “I believe I have.”
I’ve always been an entrepreneur. We should go back to when I was 22, 23 y/o when I had my first enterprise. At the time,
in Argentina, thanks to an idea I had together with another person, I managed to raise $250,000
from five investors and we built a truck wash. Something different… I’m not sure if it was the
pure definition of a start-up but it was starting a business It was very exciting; I learned a lot. I was
very young and this was something that I came up with and was eager to do. After two years, I sold it to one of the investors, so
it was a very good experience because I started to learn how to deal with investors in Argentina and how to
work in Argentina. Later on, I realized I needed more theoretical
background and a network, and began working for corporations. And for 16, 17 years, I worked for companies—mainly
leading operations in different countries in Latin America. And… -What did you major in in college? Business? -In college I majored in accounting, and then
I got an MBA degree. To be honest, I went into accounting because
of my family. My dad was an accountant. Then I realized it wasn’t exactly my thing.
It wasn’t unrelated, but it wasn’t the same thing so I decided, with much effort, to graduate. But what I liked the most was business, you know?
And later on, I was lucky enough to travel to many countries, build teams in many different countries,
meet people from all around the world. That opens many doors for you. And after 16 or 17 years, it hit me and
I said, “Now is the right time to start-up.” I founded a marketing automation and
demand generation agency. Basically, it was a great challenge to
go back to work in Argentina; first and foremost, because I had to relearn everything. Consequently, all my clients were in LATAM and the US. I had a few clients in Argentina
until one day, one of my clients in the US, a person that knew me well, in 2016… end of 2015,
sent me an offer to come here to build a start-up. I believed it was an incredible experience. To an
entrepreneur, and to me in particular, this was the place to be and to learn, and to be
with and learn from the best. So I moved in and started the business with this
partner. And for three years it was amazing. We had a blast. We had fun, I learned… It’s like doing an intensive Master’s.
Until the end of last year after… We’d had great acceptance from investors and clients. We were
starting to try things out, but we realized the product wasn’t mature enough, the
technology still needed much development. So, we decided to close it down… I believe this
technology in the future will be impressive -it already is-, but it needs more time. And from last year on, after going through the
process of letting go of the project—I was highly invested in it— I’ve been mentoring
other entrepreneurs and start-ups and I’m an advisor to an entrepreneur-development organization
here in Silicon Valley. And 3 or 4 months ago I founded Eklec which is,
basically, what you mentioned: to generate a platform and technologies that help
companies better understand the “customer journey” and become more efficient in measuring their
marketing processes, how to learn from what’s going on, and how to learn from their clients to create
their optimal pathway. That’s briefly my
path to Silicon Valley. Eugenio: -Such an interesting path. And now Sergio, I’d like you to tell us
how your process was. -Well, it’s funny to listen to
Alexis saying “When I was 22…” and this thing of going back, right? And then think about when you actually started
as an entrepreneur… And the truth is, you don’t decide to do it; an idea comes up, you want to do something… And looking back, my first enterprise was when I was 16 or 17 and a friend of mine and I started a “business” cleaning swimming pools
in our neighborhood. -Both of you cleaning things! -Well, people need to clean up! And it
was a good way of starting up, right? And at that moment, you don’t realize
you’re an entrepreneur or that you’re creating a start-up. You just have an idea and want
to carry it out without thinking, just saying, “Let’s go forward,” you know? Well, we started with that gig. It lasted a while… Then, with another friend, we created a
small business taking high school students on graduation trips to a nearby town. And later on, since I come from a family
whose mother and father are physicians, we had to go to college. We weren’t
allowed to play too much, but I talked them into letting me study design. Before finishing college, I started
working for Apple, at an Argentine reseller where I bought my first Mac
and saved up for it for who knows how long, it cost a fortune, but I wanted
the little Apple. This reseller ends up hiring me
while still in college and it was then that I began to receive these branding
manuals from Cupertino, right? And it was like something from
another galaxy. You didn’t even know where Cupertino was, but it
was like something magical. After that, I switched to an Argentine start-up
called, which around the year 2000 was one
of the first big start-ups to have raised a million dollars, which in
Argentina was something impressive. And they had a development side called
Multimedia Solutions, where we developed websites, branding,
digital marketing, etc. And from there, I went back again
to my entrepreneurial thing: 6 or 7 people from the previous company
left to found our own company. But unfortunately, 6 months later,
the country’s president takes off in a helicopter, so all our growth and sales
projections…just like the president flew away, so did our projections.
They plummeted. -What did the company do? -It was a 360 marketing agency. So the thing is that, going through this
“tiny” national problem, my partners started to step down little by little
because we couldn’t afford the monthly salary of $0. At that time, my wife had a good job
and she was the support that allowed me to go forward. But like he spoke about the “MBA,”
my MBA was ten years of having to learn how to sell, quote, and follow-up
with clients… always with my design background, where you say, “I don’t
want to see people; let someone else go.” Anyway, in one of the worst Argentine
economic crises, I had to sell. So I began a start-up, which at the
time we didn’t call start-up. It was a company, an idea related to virtualizing events. We had to cope with idiosyncrasy and
a way of doing business with people who’d been planning events for 40 years
and would say, “No, you want me to go digital, you’re going against our interests.” Well… Today, so many years later, I see things
have changed. But at that time, it was like going against the tide. Anyways, in one of those undertakings
I tried to raise capital from one of my design clients who had an investment fund,
for another start-up related to a search tool. It was then that I started getting
involved with the typical Silicon Valley process: see investors, pitch, have some
mandatory slides on the presentation, etc. And they found it amazing, so I was
like: “Great, do you wanna invest?” And he would say, “To be honest, no.”
I don’t even know how to evaluate this. We invest in real estate, agriculture…
We aren’t even able to assess its potential market nor the ROI. I don’t even know how to tell our investors,
the fund, what we’d be investing in. And the truth is, at least
at that moment, the Argentine market was too challenging. Now it’s more open. Contact a contact of another
contact… Someone introduced to me at dinner asks me: “Have you ever
been to the west coast?” “No, not really.” We’d already been to Orlando,
Miami, well… We fell in love with this place:
the ecosystem, the people, sitting with others for coffee—this didn’t
happen much in Argentina—and asking me what they could do to help me and
sometimes not expecting anything in return. It’s like… Well, like Alexis said,
they want to mentor you, to help. And we had this hunger and will
to try, so we came. We sold our house and cars. And well, we basically came to take on
one of those ideas, one of which became Redlines, my second start-up here. In the first one, we had kind of a successful exit
when another company acquired it. But that’s another story. We decided to put all our energy into
the dream, the vision… What you wish to materialize and believe you will add
something to the world. And I don’t want to sound cliché with
“Try to change the world,” but if you don’t have that sense
of adding something that doesn’t exist, the day-to-day becomes very hard, you know? There needs to be that drive, that
motivation to push you forward. And here we are. -And Alexis, what do you think
are the biggest challenges of
building a start-up? -I think once you’ve realized
that is what you want to do as a profession, so to speak, is to
find a problem; verify that the problem exists—that people or companies have
that problem— and they are ultimately willing to pay to solve it, and find a solution
that has, here we call it “market fit,” that is, to fit the way companies or people want
to solve it. To me, the other challenge has to do
with building a team, you know? A team is not only the people that one hires.
A team is your co-founder, your advisor. To me, finding advisors and mentors is
almost one of the most important tasks for an entrepreneur. And find investors that aren’t only willing
to invest money—which is very important since in Silicon Valley, having money speeds
processes up—but apart from that, that they are capable of being a mentor as well. Someone able to give you a little more and
fits your idea, someone aligned to it. Otherwise, dealing with investors
becomes a quite complex activity. And lastly, this is an iterative process to me:
you create something, try it out, learn, see what you learned and try to transform it
creatively, try out, learn… And so on. It’s a process… You need to know that it’s a process and you need
much patience. You need to let it roll and flow, and flow, and flow…. I think those are the three
important things, you know? And this is a race, a marathon so to speak,
of having a lot of patience. -Sergio, what do you think the most significant challenges are? -I think the thing about investors is
highly mythicized here. That idea of the investors, the millions of dollars,
and the unicorns… I think the first great challenge is -and
after that I agree 100% with Alexis- the period when you go from
being two or three people in a garage dreaming of something, to actually having
the company incorporated; that’s one of the first things investors demand—
having clients. Or like Alexis said, finding
a small market fit of someone interested in using your product… But in the meantime, you need to survive. I think that’s the first big hurdle that
entrepreneurs who’ve never really risked have, you know? like dealing with uncertainty
like we talked about earlier. I think we don’t evaluate
uncertainty: “I want to do this, and I will do whatever it takes to make it thrive.” It’s in your nature: “This doesn’t exist,
I think I found something. I want to do it.” And you don’t stop to think about what would
happen if it went wrong. Because if you believe that, you won’t take it on. Here there are no schedules,
this is you all in. I agree with Alexis regarding the team.
I think you need to be surrounded by people who believe the same as you,
that they share beliefs is fundamental—, positive people, not the troublemaker,
the “no-but” person, no. It’s “yes-but.” Embrace the challenge, you know?
Yes, there will be problems, and that’s what this is about. It’s the marathon,
like he said. There’s no finish line. If you expect a finish line, you won’t
take it on either. Enjoy the journey, enjoy the path, and
every day you get up and solve problems, because that’s what this is about,
and in the kind of things we are tackling It’s exactly like Alexis said:
I do this, present it, learn, get better. It’s endless. And a company like Pinterest, that
went public two days ago, is just starting its next phase. -Alexis, if you had to compare the
advantages of being an entrepreneur here to the ones in Argentina, what are the differences? -I basically identify two or three, you see?
One has to do with the ecosystem. Here, there is a decades-old ecosystem
that runs very smoothly. It’s a gear assembly. And you go through every one of the gears
at the right moment and your creativity is set more on the job
and the problem you want to solve than in recreating or building that ecosystem. So you’re only thinking about your idea,
thinking about your client. That’s the first point I see.
The ecosystem in Argentina or Latin America —In Argentina, it’s quite developed despite everything— is still emerging, there are still some
elements that need adjustment. But I think it’s being built up and I like
what’s starting to happen in Argentina. So it’s a question of time. The second (challenge) is how you
use your time. Here in Silicon Valley 95% of your time is dedicated to your start-up,
your client, and your problem. You spend the whole day on that.
There are no other issues. All the legal stuff, the logistics, are taken care of. Again, you just need to think about how to
create the best solution to the problem you want to solve. And the third one is related to a
financial-legal framework, so to speak. I believe that… Well, it’s not something
that I made up: a start-up is conceptually born to die. It dies in several ways:
because it goes out of business or fails, because another company acquires it;
or because it goes public and is no longer a start-up. That’s extremely important in an
entrepreneur’s mind. To say: if I have to close this company,
what happens afterward? Well, I closed down a company here
and it only took two emails. Two emails. And I don’t…. The only consequence of that
is me being called to give talks to explain what I learned and how
things don’t always go the way we expect. And that’s all. I don’t need to testify and explain
that I didn’t fake going bankrupt, and that companies fail. In Argentina, when a company fails,
it’s a problem. I tried to close down companies, it’s difficult,
it’s very complicated. And that isn’t a minor thing
to investors. And for investors, this is a
risky investment. Building a start-up
means knowing that 95% of start-ups die in the first two years. So, if you are going to die,
at least die in peace! In the US it happens smoothly,
in Argentina, it’s more complicated, or at least my experience was more
complicated. So there is this question of the
regulatory framework, how organizations and start-ups are ruled. I think this is something that will change
but at this moment, it’s complicated. -Sergio? -Failing here is well-regarded.
Because if you failed it means you learned. And here… Of course, if you had a successful
exit, you sold your company, or your company went public
or whatever, you’ll show more value; but each experience the
entrepreneur has, gives them experience and knowledge. And I deeply believe we learn more
from failure than from success, you know? Or at least it lasts longer.
It hit harder. So I think that seeing the positive side
of failing, makes the ecosystem more willing to accept that if
you failed once; it’s not that you’ll fail again: you’re more likely to do better next time. -Alexis, to create a start-up you need
to have investors. If you don’t have money from
somewhere else, you need to go out and get it. What’s the investment pitching process like
in Silicon Valley? -Look, it’s a well established and
regulated process, you know? Basically, what you need to do first
is, based on what stage your start-up is at, understand what type of
investor and the amount of money you need. There are investors… Just to give an idea,
there are more than 10,000 accredited investors here. There’s a
definition of an accredited investor. That means there are investors
for every kind of start-up. There are investors for recently
created start-ups. There are others for
start-ups that need to find out if there is a market fit, that is, if
the client is really going to buy what you do, there are others
to escalate or globalize… For science, for apps, for gaming… So once you know the type
of investor, whether it’s an angel, friends & family, venture capital
or whatever, then you need to see which tend to invest in your market. For example, at some moment, mine
was clean energy. Once you find that out
and you have a list, the big challenge, to me,
is get a meeting. The best option is for someone
to introduce you. If someone connects you, does an intro,
it’s the best case because you can get it for sure. Then there are lots of events
where you can meet investors; there are demo days if you worked
with an accelerator. So from that point of view,
(everything) is very well organized. Once you have an investor or
10 or 20 meetings set up, you better have an excellent presentation
to blow their minds in ten minutes. Because these investors are going to
see 10 people like you in one day and in a week they’ll see 50
or 100 like you. Regarding the presentation itself,
many years ago I read a book by Guy Kawasaki called The Art of the Start,
where he said that you need to have ten slides, 20 minutes, font size 30—
10, 20, 30. Don’t start trying to recreate stories
or act out the presentation. I remember a long time ago, a
friend told me something and now I’ve confirmed it: one thinks that
the pitching process is the goal but what you learn is
that you better keep your strength, because from the minute you get
the money, you need to run and execute, achieve the goals you
promised the investor, to raise money again because you
run out of money right away. That means if you haven’t gone
public, that process never ends. -Sergio, what’s your impression?
Do we need to train? Do people prepare? Is it easy? -Well, there are several issues. For example, I’ve participated in
some of these pitch events and you see that their focus is more on how
you stand, how you speak, how concise and concrete you are, your ability to convey a certain amount of ideas in three minutes… For instance, my first frustration
was that they were more focused on the way I spoke or pitched, and I
wanted to get feedback about my company, the start-up, the idea,
and the concept. And it’s like he says, it’s kind of
an art. You prepare, try to memorize it, but it mustn’t
sound rehearsed. It is true that, and you can check
that out on the internet, the things that never fail and are what
investors expect to see which are: giving a bit of context,
describing the problem, the (product’s) potential,
how big its market is—that’s what interests them the most—
a how-to solution that will solve things, the team you have to back
all that up, and that includes your background, experience, your
team’s experience and so on and so forth. And that’s it. For your first pitch, you’re looking to
strike a chord with that investor for them to ask questions right then and there,
or give you another meeting that won’t last 5 minutes this time. They’ll give you 10, 30, 60 minutes,
and technical and marketing people will step in and things will
get more serious. And it’s like Alexis said: you need to be prepared because
you’re asking somebody to give you their money and believe in you. First of all, you need to believe it yourself;
If you don’t believe in yourself, you won’t make
anybody else believe in you, and let alone get somebody’s money
for you to “play” to develop it. -Sergio, if you had to advise
somebody who wants to build a start-up and comes to you,
what would you tell them? -You need to be a bit bold,
you need to believe in yourself, and if you don’t, surround yourself by people
who’ll help you, because you don’t have to know it all. And here’s where the team’s value lies;
people who make a difference, not people you bring to tell them what to do. Expect to find more thorns
than roses, and always move forward. -Great. Alexis, what do you think
about that? What advice would you give? -You need to have the ability to
convince a lot of people. First, your family. First. This is a complicated path that
takes time. So if your family doesn’t understand what an entrepreneur is,
or they don’t follow you, that’s a problem. Then, you need to convince the clients
that their life will be better when they try your product. The same way that my family
would have a better life when I moved them here -I thought-, the clients that use your product
will have their lives changed. And to investors, that you’ll make
them rich. I mean, it’s to convince, the whole
day to convince. That’s why if you yourself are convinced,
you’ll be able to convince others. Second, this is all or nothing to me. I mean, take risks. If you’re doing it, dive fully. You need to go fast because
what sets you apart from corporations is your
speed, your quickness to act. And then you should check in
and see if you’ll put up with 100 no’s
until you get a yes. Well, and a bonus track, a piece of
advice for entrepreneurs: I believe a very important
characteristic is being able to network. Knowing the right person or
someone you already know who can give you the right help
at the right time, changes your business’ game altogether. It can potentially change it. Here, the ecosystem is very
prepared for that so you meet people who help you,
and the same way that people help you, it also raises the awareness in you
to help others, and that’s why I join organizations that help other
entrepreneurs. Or when someone from
Latin America calls me asking for help, or wants to brainstorm, in my opinion,
we need to have time for that because people here, despite being very busy,
they always have one hour to give you and talk and help you. -Well, thank you very much, Sergio,
Alexis, for sharing this wonderful experience you both have,
and that will be so useful for those watching us who want to build a start-up. Thank you for being here. -Thank you Eugenio.
It was really fun. And it’s good to look back
and think about “how you got here”; to stop and think about all these questions. -Well, thank you. It was truly
a pleasure to be with Sergio and you. It was such a dynamic chat. I hope it raises people’s awareness
and clear things up a bit, but also know that there are certain things
that are good to understand before diving into the sea of entrepreneurship.
So thank you for the invite. -Thank you both. If you liked our channel, feel free to subscribe, to like it or to share it Thank you.

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2 thoughts on “Silicon Valley Entrepreneurs – What you need to know

  1. Thank you "Silicon Valley Entrepreneurs" to give our Founder the chance to share some experiences and insights from his journey!

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