Having just turned 35 and already boasting an extensive curriculum (anyone who is interested can follow him on LinkedIn and on his Twitter profile), we would like to introduce you to Álvaro Cuesta, senior executive at Sonar Ventures and protagonist of an Entrepreneur Series in webinar format run by EAE Business School. As he leads the eighth session of the series (which goes by the title of “The customer right from the start: acquiring, activating, billing and retaining”), we wanted to take advantage of Álvaro being here to put a human face to the figure of the entrepreneur and their ecosystem, a figure that has been trivialized in recent times.
The main errors of an entrepreneur
“The first mistake is not asking the market and thinking that our solution is the best”, states Álvaro, who believes that bad team management and the ‘luck factor’ when launching a product are the other two sides of triangle of errors of the venture.
“You can start an entrepreneurial project without financing. In fact, I set up my first company with €60 in my pocket”. On this matter, Álvaro believes that “nowadays, there is an approach that seems to prioritize financing over our product’s performance on the market”, which even reaches the point of becoming “a kind of obsession”. “There are companies that could sustain themselves through the market, their own customers and bank financing, although they go to great lengths to attract the attention of investors”. As far as the director of Sonar Ventures is concerned, this “obsession” may lead to “flawed cashflow management”.
Trivialization of the figure of entrepreneur
“There is a keyword involved in internet ventures: posturing and showmanship. There is a kind of circus of entrepreneurship, where there are certain usual suspects (among which I include myself) in which we are all entangled”, says the former chairman of AJE Madrid. “Launching an entrepreneurial project seems to be a question of going to as many events as you can, giving motivational speeches, meeting more people, gaining more rounds of financing and so on. This is all underpinned by putting on a good front and pretentiousness in all of the actions related to the venture”.
However, Álvaro highlights another profile of entrepreneurs, the quiet ones, who are those that usually end up achieving the much sought-after exit. “It is important to distinguish between networking and not working”, he states. Although there is plenty of the latter in the current Spanish entrepreneurial ecosystem, it is equally the case that there is a large group of people who have got their ideas straight and have understood that success is tied to the culture of effort and hard work. “These are the entrepreneurs worth their salt”.
Entrepreneurs to follow
“That is not to say that true entrepreneurs don’t tweet, but rather that their KPIs are not vanity metrics”, says Álvaro. “within this profile, I would give a particular mention to Emilio Rodríguez, one of my partners. He chooses the right events to attend very well, and puts in at least his eight hours of work in. That is the spirit, not being a bullshitter, but rather guiding yourself with real economic criteria”. Other entrepreneurs to follow in Álvaro’s opinion include Gustavo García (BuyVip) “because, despite having had a great exit strategy, he is still rigorous”, and Iñaki Arrola, who “is involved in the showbiz side as well but doesn’t let it get the better of him”.
Start-ups to follow
In this section, Cuesta puts his money on two completely different projects: Firstly, Milanuncios, “a start-up which, while not being very cool, was sold for a great deal of money”; and secondly, Cabify, “a project that hardly anybody associates with Spain: they have a global concept of the market but they operate from Madrid”.
Trends: what will be the next star sectors?
Another current issue is the matter of which sectors have the greatest potential for success. However, before stating the positives, let’s focus on the negatives. “Ecommerce is on the decline. It is not as profitable as was first thought, as the exit comes further down the line in the long term”. This is not the only sector that will have to evolve, however: “in the future, I think that there will be more APIs than apps: traffic generators that act as virtual assistants, so that rather than creating apps that compete between themselves, they are integrated wherever the user may be”.
What about Big Data? “Although it remains the great unknown, there is an ever-increasing number of practical applications driven forward by specialist start-ups that respond to the real needs of multinational corporations, which, at the end of the day, is the profile that is in a position to acquire them”. Another sector that will suffer is marketplaces, “a somewhat saturated model”. However, Álvaro does believe that the “cooperative economy in general” has a future. Smart Cities (taken more as a concept that providing service to the citizen rather than the customer) and E-Health (platform where scientific research is brought together with the Internet of Things) are other areas to keep an eye on.
If you would like to watch the eighth session of the Entrepreneurs Series again, simply click on the image below. In addition, you can download the presentation used by Álvaro Cuesta by clicking here.