July 23, 2014
Marco Giberti has a non-traditional approach to his role as an investor. He likes to be “hands- on,” which means he is very particular when it comes to the startups he invests. Giberti has been a successful entrepreneur angel investor with more than 20 years of experience in both United States and Latin America. Currently, he is a partner at Vesuvio Ventures, an early-stage investment company that has successfully invested in startups like MyMela, LiveNinja, and DoubleDutch among others.
Giberti had a successful career as a corporate executive at Apple computers before cofounding Mind Opener, a leading publishing group in Latin America. Mind Opener was eventually sold to British Pearson Media Group. This was the first of many companies he successfully started as an entrepreneur, which might explain his preferred hands-on approach to investment. He is known in South Florida’s tech community a pragmatic and approachable investor. We wanted to pick his brain.
What do you look for when making the decision to invest? What is your process like?
My process is a combination of the process in my previous company and some classic angel investment due diligence process. I give much more attention to the startup team and people skills. Probably this is not an approach used by traditional investors. I’m not a traditional investor at all, I consider myself an entrepreneur who “occasionally invest” in companies that I can add value to.
What is typically your bite size? Does this change depending on where the company is based?
It used to be the classic 1-10% size from angel investments, but it’s moving more into bigger size since I have more fun and incentives when I’m a bigger shareholder with specific roles supporting the entrepreneur/founders team.
I’m inclined to be hands on and have strong operational skills that I like to share with the team and the company. Because you can only do this few companies, as an investor you need to be sure that those teams and companies are the right fit.
When was the last time you made an investment?
This week :).
So far this year, investment in South Florida has been relatively low. In your opinion, why do you think this is so?
I think that many of the active investors from the last 3-5 years are tapping out their resources (time and money) in SFL. There needs to be an effort to educate and attract new angels and VC’s into the region and show them success stories in this entrepreneurial ecosystem.
I’m convinced that there is money available for funding here in South Florida, but investors still need to understand that the opportunity is big enough and the people involved (investors, entrepreneurs, mentors, etc.) are global class and will deliver great results.
What is a common mistake made by startups when they are negotiation terms?
There are so many different mistakes that it will be tough to present on a simple way.
Diluting too much equity too early just for money (and no added value) is a classic mistake and usually is very expensive for the entrepreneur. Not having founders repurchase agreement is another one that is usually painful for entrepreneurs if things go wrong between founders.
I would encourage entrepreneurs to apply classic TechStars seed documents on their rounds and research industry benchmarks in order to analyze if their deal is fair and attractive. Every deal is different and every entrepreneur needs specific ingredients in order to make the company successful.
Choosing the right investors and mentors is certainly one of the important topics for any venture.
You invest in LatAm, what are some of the trends you’ve been seeing lately in the startup industry?
I invest in Latam and US and there are two completely different worlds in so many levels. I think that we are seeing a different reality in Latam, particularly in Brazil during the last year. Many valuations are going down considerably and the good deals and great entrepreneurs are the only one having an “easy” time to defend their terms and valuations.
The rest of the market is suffering to support their terms and we are seeing many down rounds around the region. We all know that having a successful exit in LatAm takes long time and the real “big exits” in the region are very few. As an investor, you need to invest in very reasonable valuations in order to expect an attractive exit. You also need to be patient and understand that the risk/reward equation, access to capital in the region is completely different.
I really like LatAm companies that think globally and have the vision and execution skills to play on a global way. I’m super excited to see cases like Globant going public in US and I hope to see many more of those cases during the following years.
I’m also excited to see the progress done inside the Miami entrepreneurial ecosystem during the last years. Many US and LatAm companies are establishing operations here, this city is the gateway between North and South America.
Books you recommend to all entrepreneurs
Venture Deals by Brad Feld, Lean Startup by Eric Ries and The Art of the Start by Guy Kawasaki
What kind of animal would you be and why?
Dog! I simply love dogs…they are always happy, they are loyal, friendly and they enjoy live on a simple way!
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