Ignacio Gabaldon is an engineer and entrepreneur. He is now leading Igeneris Ventures, the Venture Builder branch of Igeneris working with a team to create a curated pipeline of startups that serve both Europe and Latin America from their office in Madrid, Spain.
Here are some highlights of our discussion:
- Igeneris evolution from a single-focus to a dual venture studio model servicing clients and building its own ventures
- Talent requirements and risk appetite needed for building new ventures in highly industrialized and regulated industries such as Energy and Telecommunication requiring industry-level stakeholder alignment
- The evolving talent landscape for hiring digital consultants, intrapreneurs and founders in Europe
- How to incentivize the CEO at the right level and become investment-ready as a VB startup
- How to navigate competition with corporates when operating a dual studio model
Listen to the Episode
Andries de Vos: What is the founding story of Igeneris?
The founders came from the corporate world. They realized that the only thing they could do to make their business lines grow was actually to innovate and get new business models, new startups.
It was pretty hard in the beginning, 10 years ago, to convince the companies, because the idea sounded strange to them. Now, I think we are in the middle between entrepreneur and corporate, and we have shifted toward entrepreneur since the start. The market is more mature in the last 2 years, but in the first 5 years of Igeneris we were alone in this battle in Spain.
Andries De Vos: You come from consulting background and now you are exploring an operational model. That is a different skill set. How do you build your talent pool?
The market is changing, now you see a lot more demand for CEOs and COOs, country managers for Spain. Ten years ago, the word “startup” was not popular. With the talent we raised in the beginning, we focused on the services part, on innovation consulting, and selected people who like to work for corporates but don’t like the project to stop at presentation ideas. Eventually, we managed to convince our clients that ideas are just the first stage of the creative process but not the goal, that we can test the ideas, and build small websites. The team started acquiring the skills, mostly self-taught. Clients also wanted to go a little further.
Talent is different now, we are cultivating skills like innovation and creativity, being on the edge of technology. This culture shift came from the market: we pushed the clients in the beginning, then they started pushing us also. It’s easier to recruit now, there is more competence. When I’m interviewing people to come into the team, the aspirations they have is one of the key questions we ask. I’m coming across many young people now whose dream is to launch their own company now. For them, our company is a place to learn, but the ultimate goal is to have their own. It’s good to have talent that wants to build their own things.
Andries De Vos: You work primarily one-on-one with your clients. Are there opportunities for you to tackle things systemically, e.g. solving the electrification of transport in Spain? Such projects require multiple players.
It’s not easy with many companies at the table, who are competitors. There are aligned interests, but there are also many cross interests. Is the venture building a facilitator in this process?
Capital is really important. If you first raised a small fund and then had many companies talking about solving an issue, it would be easier. If you are a small venture builder working with a fee-based model, you don’t hold the power at the table at that point. There is an opportunity here, but the process is hard and slow. We’ve tried. Some things worked correctly; others just didn’t go through.
Andries De Vos: You are now building your own venture. What is your strategy?
We started with this model about a year ago. We want to do things we believe we do better – spotting the right opportunities (market gaps), converting them into ideas, and validating those ideas. We are not focusing now on any specific sector. If we have knowledge about companies and trends, we are going to use it, of course. Our aspiration is to do that part really well. When we have validated the idea, we want to incorporate the new founding team, the people who are pretty good in one sector and have experience there, want to start a business and do something different.
Our ambition here is to keep building ventures and refining the model. We believe it is more of a framework than a model, every startup is different from the other one. The two startups we have in the market now are in the same stage, but they are completely different in every aspect.
Andries De Vos: Are you looking for certain investments in your checkpoints? Is every startup different in that aspect as well?
We think in terms of time, mainly: maybe around 6-9 months to spot the idea and validate it, hire the new founding team, and do the introduction to the business. We would love it to be 6 months, obviously. We don’t talk in terms of cash because that really depends on the type of company. If you want to validate 3 ideas, which are marketing-intensive, in the same year, that’s going to cost a lot of money. If you want to do something on the B2B spectrum, that means mostly paying the salaries of the selling team, not marketing.
Maybe having funds in the future could make us do things in a different way, but right now, we are supporting those first 6-9 months with the teams, and then looking for funding with them.
Andries De Vos: How is that being received in the market, are the corporates threatened by you as a potential competitor? Are investors seeing this model as a bonus or a potential risk?
I don’t think corporates are threatened by us. We are 10-15 times smaller than any corporate we work with, so I would see them as potential partners farther ahead on the road. We consult them on an issue they have, and sometimes it’s as good to build a venture with them as to build a venture without them and serve it to them. I don’t have an answer about the investors yet. The spectrum is huge there.