Hi there!
Welcome to the Inovo newsletter, aggregating some of the most exciting news from the world of startups and Venture Capital!
If you wonder why we are slightly late with our quarterly update, it’s probably because it was one of the best periods in the history of Inovo. In the last few months, we have closed two new investments, and two of our portfolio companies had great subsequent financing rounds.
I’m also delighted by the fact that the tech industry in Poland is booming. The value of Venture Capital investments in 2020 in Poland was 70% higher than a year before, and there were three mega-rounds - Booksy, Brainly, and ICEYE. On top of that, last October, we have seen Warsaw's largest-ever listing - Allegro (Polish e-commerce) which was valued at $19B after first-day of trading. Last but not least, Inpost (Polish parcel-locker firm), IPOed on Euronext Amsterdam Stock this January, and is worth around $10B. Can you believe that this company was taken private from Polish stock exchange back in 2017 for a price slightly above $100m*? That’s 100x increase in value in around 3 years. Great companies can be built in Poland too. I couldn’t be happier that both Damian Zapłata, Board Member of Allegro, and Rafał Brzoska, CEO of Inpost are actively co-operating with Inovo.
All of this makes me think about the race for the title of the first Polish unicorn**. I have my own candidates, but I will be happy to listen to your opinion. I spent a lot of time talking to founders and other VCs on Clubhouse in the recent weeks. If you don’t want to miss discussions, that I participate in, make sure to hit the follow button in the app. You can find me on Clubhouse under the name “Tom Swieboda”, or handle “@inovo”.
Inovo Portfolio news
I will take a moment to think for a second about our achievements in the past year. We have increased our fund to $50M as well as invested in 8 amazing companies. Majority of our investments in 2020 were on Seed stage, which is part of our core strategy. In 2021 we will continue to support amazing early-stage post-product, post-traction companies in Poland and the region.
But now let’s have a look at what happened in the last quarter:
Booksy just raised $70M in a round led by CatRock. Part of the capital was consumed by the merger with a Polish competitor Versum; the rest will be used to expand in the US. We have sold 20% of our shares, earning over 10x on them. We are super happy to be part of that journey for the last five years as one of the first institutional investors of Booksy, and we are looking forward to the next great years to come. One of our partners, Michał Rokosz, acted as COO of this company for almost 2 years. In a few days, you will have a chance to read about his behind the scenes insights on our medium #GoBooksy
How about the new members of our family? In the last quarter, we have invested in Jutromedical, a mobile-first primary care provider. The company offers an outstanding product that patients love and is focused on doubling the efficiency of medical workers by automation, so as a result, medical workers love it too! It’s no wonder with such an exceptional team - Adam has built a productivity app with 500k downloads, while Krzysztof has founded a backend-as-a-service company.
We have also invested in AI Clearing, which develops a fully automated construction progress tracking solution for infrastructure projects. The company has already proven that it brings value to the customers - it detects potential frauds and improves the projects’ quality and timeliness. For us, it’s only a matter of time until they change the huge yet conservative market. The company is run by veterans who know construction sites and drones inside out - welcome Michał, and Adam!
Last but not least, one of our portfolio companies has raised subsequent round with a great fund from London as a lead. We can’t share more as of today, but stay tuned for a public release in a few days!
Inovo readings & listenings
In the last year, we have started something new - Series of Inovo Podcasts, and we have almost 10 episodes at the moment of writing this. I love talking to entrepreneurs and other investors, so it’s an excellent way to contribute to the ecosystem and share my guests’ knowledge. I hope that you subscribe to our YT and Spotify! Let’s see our episodes from the last few months:
In the most recent episode, I interview Zach Coelius, a 4x entrepreneur, and business angel in over 60 companies. We talk about employing poker in a startup building, culture in Silicon Valley, and tips for Polish startups approaching American angels.
The episode will be published on our YT and Spotify this week. Subscribe to be notified!
In the episode from November, I talk to Kai Hansen, great Business Angel who invested in several Polish companies like Booksy, Spacelift, Jutromedical, and Sundose. We’re discussing his way to build one of the leading food delivery platforms after the 2008 financial crisis and what gets him excited in early-stage startups
Click to listen on YT or Spotify
I also had a chat with Piotr Pisarz, founder of Uncapped. He shared with us his tips on the fundraising and recruitment processes. You will also learn what’s the CEO’s role about, how Piotr has built his network in London, and what's the story behind Uncapped
Click to listen on YT or Spotify - the episode is in Polish. English subtitles are available on YT
We are also working on the English version of the summary of Polish Venture Capital market in 2020. In the meantime here is a sneak peek on the growth of the value of VC investments in Poland between 2016 and 2020 [PLN M]:
Recommended readings
Micha Kaufman, the Founder and CEO of Fiverr, talks about the early days at Fiverr and what lessons he learned while leading one of the world’s biggest marketplaces on the road to 797% Growth. He answers the chicken-and-egg question of marketplaces and suggests focusing on supply that generates demand. Another hint is that initially, he was obsessed about figuring out his value creation to his customers instead of the scale.
When you sell to enterprise customers, you often have centralised decision-makers that you need to approach and convince to your product. A16z explains when it’s worth adding top-down sales to your Product Led Growth strategy in their blogpost.
Listening to your customers is essential, and it can work miracles. That was Domino’s Pizza’s case that delivered returns of a tech stock (90x increase in the stock price in 10 years). Taking customer feedback seriously was their recipe for success!
There are two more interesting reads for those of you who want to learn more about the IPOs of Polish companies that I’ve mentioned at the beginning. Gonz Sanchez described the history of Allegro, while Financial Times has described the IPO of Inpost and returns to their Private Equity Investor - Advent.
Thank you for reading till the end of this newsletter! Please subscribe! It’s a cyclical initiative, and you can expect the next edition towards the end of April.
Best regards,
Tomek
PS. If you know someone who might be interested in reading this newsletter, please go ahead and share it!
*to be precise: $130m = PLN 475m = InPost PLN 125m + Integer PLN 350m
** in a traditional sense so “a privately held startup company valued at over $1 billion”