On May 20, 2018, the Eckerd College alumnus, co-founder and CEO of Mangrove Capital Partners, and chairman of Wix will give his alma mater’s 2018 Commencement address He also took on the chairmanship of the website generator and management service Wix which currently is trading on the NASDAQ for nearly $3.5 billion Mangrove Capital Partners has also invested in more than 100 companies and counts among its portfolio such rising stars as FreedomPop Mangrove manages nearly $1 billion across five funds Outside of the office, Tluszcz is a known proponent of workplace diversity and helping fledgling tech investors tell the real “unicorns” from the “fakies” (overvalued, unproven properties). He was named to the Forbes Magazine Midas List in 2007 2008 and 2009 as one of the top 100 global dealmakers in technology Tluszcz has also appeared on Bloomberg TV and CNBC; been quoted in Forbes The Wall Street Journal and The Boston Globe; and has published in the Financial Times “Mark Tluszcz is a visionary, a global entrepreneur and a proud Eckerd College graduate of the History program,” said President Donald R. Eastman III. “An inaugural Ford Scholar Mark spoke at the 25th Anniversary celebrations for the program has continued to foster relationships with mentors from his undergraduate days and through his business practices and principles continues to espouse the values fostered at Eckerd We are honored to have him back with us at Commencement.” St. Petersburg, Florida 33711800.456.9009 or 727.867.1166 A full three-quarters of all current unicorns have joined the club since 2019 in spite of the covid pandemic and consequent financial meltdown Where should the smart investor be looking to put their money And is there a danger that the unicorn bubble could burst as swiftly as it arrived co-founder and CEO of venture capital firm Mangrove Capital Partners considers the future of the unicorn Mark Tluzscz is a Managing Partner and Co-Founder of Mangrove Capital Partners and also serves as the Chairman of Wix.com as well as on the boards of a number of private Mangrove Capital Partners portfolio companies Mark was a partner for Arthur Anderson LLP in their business consulting practice and he also led their European venture capital fund He is well known in the industry for turning a $2 million investment in Skype into $200m and an $8 million investment in Wix.com into $700m "We've glorified the status of what it is to be a unicorn," Tluszcz tells Stephen "and I think that's unfortunate I think we make it the desire that everybody shoots for the status of unicorn doesn't last forever To use a sports analogy- you’re qualifying your team for the FA Cup final and you're celebrating before you actually play the final The final in my mind is either you get sold or bought by somebody or you take your company public if you look at many of the ones that are currently in that unicorn list many will likely never ultimately be sold for anything near that or will likely not go public." But it's not all doom and gloom – and there are some areas where the shrewd investor could attain great returns: “I think the question is one of timing And so a lot of the work that we do at our firm is taking out a crystal ball and saying what's going to be hot or hip in ten years we think health care is one of the great areas where there's big opportunities to disrupt the existing system we spend about 12 percent of our GDP on health care it's 17 percent and our population is not getting any younger And so the only way we fundamentally change that is by applying technology to trying to solve some of these issues How can software how can the internet just make it easier governments and things like that to operate FIND MORE STORIES FROM THE AGENDA WITH STEPHEN COLE HERE Disinformation report hotline: 010-85061466 which met Bank of England to discuss governance practices over weekend was backed by investors before changing CEO Bank of London raised £42 million from investors last month before HMRC issued a winding-up petition against the company over unpaid taxes which is now said to have settled the debt – of which directors claimed they were “unaware” – met with the Bank of England to discuss its governance practices over the weekend The firm’s founder Anthony Watson (pictured) stepped down as CEO last week for an advisory role and was replaced by Stephen Bell former chief risk & compliance officer The funding round in August was led by Luxembourg-based Mangrove Capital Partners Mangrove CEO Mark Tluszcz has sat on the board of the company since 2018 In a press release which did not mention the tax situation Bank of London said it was celebrating two milestones: customer deposits passed £500m in August having more than doubled since the start of the year while it has now onboarded its 100th institutional client New Manchester unicorn as SafetyCulture raises £85m “The Bank of London’s ability to close an over-subscribed £42 million funding round speaks to the confidence investors have in its leadership and unique model,” said Tluszcz “The bank is well-positioned to redefine the future of financial services and we are more than happy to support it.” Bank of London raised £33m in an extension to its Series C round early last year which at the time took the company’s total capital raised to $160m The bank reported losses of £12.7m in 2022 “Our banking model is built on security and simplicity,” said Bell “By holding deposits at the Bank of England businesses have full confidence in their funds being available at all times “Our success in completing this £42 million funding round underscores investor belief and confidence in our vision and I am excited to take over leadership of The Bank of London as it continues to grow.” Bank of England made a bid to rescue the UK arm of the collapsed Silicon Valley Bank last year Why Oasis ticket price debacle was anything but dynamic This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply Δdocument.getElementById( "ak_js_1" ).setAttribute( "value" ShareSaveCommentMoneyMarketsChairman Says Wix To Accelerate To 20% Profitable Growth By 2025ByPeter Cohan Forbes contributors publish independent expert analyses and insights 09:40am ESTShareSaveCommentThis article is more than 2 years old.Mark Tluszcz Wix reported 6% growth and forecast 10% expansion for 2023 Investors have since rewarded Wix shareholders with a 10% increase in its stock Does Wix have enough growth potential to restore the 73% plunge that investors have suffered since its shares peaked in April 2021 The outcome depends on whether the Tel Aviv-based operator of a cloud-based website design and development platform can achieve the ambitious goals that Wix Chair Read on for what he told me about how he became Wix’s chair its goals for growth and profitability and its strategy for achieving them Wix’s fourth quarter results and guidance exceeded investor expectations RBC Capital wrote that its Q4 results were a “relatively clean” beat and raise RBC — which raised its price target 15% to $115 — argued that Wix’s free cash flow (FCF) remains “underappreciated its subscriber additions are likely to reaccelerate and that the favorable customer mix shift is having a growing and more durably positive effect,” noted TheFly According to TipRanks Wix is confident in its progress and prospects “In the face of a dynamic macroeconomic environment this year we shifted our focus toward tightening spending and becoming more efficient in the execution of our priorities We released hundreds of new products and features throughout 2022 to improve our platform for self creators and partners.” Wix has come a long way since Tluszcz first invested 16 years ago and is now in the middle of a great metamorphosis that he says will lead to rapid growth and significant FCF “Wix went public in 2013 and I have been executive chair since 2016 I invested in Wix in 2007 after taking a stake in Skype I thought nothing could be better than Skype.” The tailwinds were strong because small and medium-sized businesses were paying $25,000 to hire companies to build websites for them It took many tries to get that business model working “We tried 27 different approaches and ended up with something simple: if you want your own URL Now we have 250 million websites and six million of them pay People use it to transact or to have an identity some restaurants don’t pay — they have their name and Wix’s URL,” Tluszcz said The pandemic was a rollercoaster ride for Wix — up in 2020 and 2021 and down in 2022 Covid created an artificial bump in demand and we thought it would last Our average growth rate since the IPO was over 30% and in 2021 we grew 40% to 42% people were going outside — not just going online They were no longer spending 18 hours a day online Wix adapted to the reckoning by changing its goals and strategies Companies had to change from growth at all costs to becoming a business They had to graduate from the minor to the major leagues.” One way that Wix graduated was to move into a large new building on the outskirts of Tel Aviv — which in my view put cost reduction pressures on the company the new headquarters building “is a major statement that we’ve become one of the key players Another part of Wix’s great metamorphosis is a plan to become profitable “To be a great business you have to become profitable In the first quarter of 2022 we had our worst FCF ever Over 13 years we had a growth at all costs mindset and we changed to a culture of balance We are guiding toward EBITDA profitability in 2023 and GAAP profitability in 2025,” he told me Wix also changed its culture and holds people accountable for results We shared our vision to be the market leader in websites and be profitable The key performance indicators have changed to growth Not everyone will like the change — but despite some people leaving “We ask them if they are still comfortable at Wix We will add people — we have 5,000 employees now and could have 10,000 by 2028,” explained Tluszcz Wix’s guidance of 10% growth this year may prove to be conservative — depending on the outcome of uncertain macroeconomic factors “In 2023 we hope to get a better idea about where the market is going we expect to have a clearer idea of the macroeconomic headwinds on recession We hope to be better than [our conservative guidance],” he said Wix sees itself as competing in two markets — one stable the other with significant growth potential “We are a $1.5 billion revenue company with two lines of business The do-it-yourself (DIY) website building business is stable and will grow 15%.” The faster growing business aims at website consulting companies — which he calls partners Wix is adapting its DIY business to meet the needs of a different customer group 500 invoices to those partners — who built websites for 500 clients — because we treated them as if they were individual DIY clients We have fixed that problem and now offer tools to help professionals We will find ourselves taking on more Fortune 500 companies who are hiring those professionals to develop their websites.” Wix has developed services targeted at making its partners happy “Professionals want to spend most of their time doing website design we use artificial intelligence — including a partnership with ChatGPT — to draft the text on a website supply administrative tools to manage the customer base The first is to maintain a commitment to product He credits good Wall Street analysts for recognizing that Wix will not achieve its financial targets unless it keeps offering the best quality products The second is to recognize that companies go through cycles as they grow we had 1,000 people and lacked sufficient accountability Our 20 to 30 top managers spoke to other high tech companies that had dealt with this problem We broke the company into guilds that were accountable in different places,” Tluszcz concluded Can Wix stock get back to its April 2021 peak? The 16 analysts who offer a 12 month price target see it rising nearly 16% to $105, according to CNNMoney If Wix exceeds its growth and profitability goals Tluszcz and the Life Chariot won the 2023 James Dyson Award in the Humanitarian category but does the trailer have a tow-ball so that two (or more) could be linked Anything with a hitch can be pressed into service Test it out; it only takes a single click to unsubscribe Tactile is a product and UX design firm founded in 2004 is a boutique industrial design consultancy that .. With a stellar record of design and engineering successful products with World Class brands since 20.. Spatial Dynamics is a hardware product design and development agency located in Cambridge RKS is an award-winning global product design firm and innovation consultancy specializing in indust.. Tluszcz and the Life Chariot won the 2023 James Dyson Award in the Humanitarian category Don't have an account? Join Now Already have an account? Sign In Please enter your email and we will send an email to reset your password A hands-free IV device that helps medics during disasters and an innovative ambulance design are among the winners of this year’s James Dyson Awards An ingenious off-road ambulance that can attach itself to any vehicle has been awarded a James Dyson award for the best humanitarian entry after the creator was inspired to design something to help during the conflict in Ukraine Piotr Tłuszcz created the Life Chariot a light ambulance that is safer for a casualty to travel in than the boot of a car to help medical evacuation teams in challenging terrains Two initial builds of the invention have been given to the Ukrainian Medical Military Unity and the Polish Voluntary Medic Unit of the Damian Duda Foundation after being tested in a range of terrains from trails and forests to caves and even mines “This year the James Dyson Award gives a special humanitarian prize to Piotr who has designed an ingenious way of recovering injured people from challenging terrain,” said engineer and inventor James Dyson after whom the annual design award is named “The Life Chariot can be towed by anything – allowing medics to do their life-saving work with the resources they have at hand It’s also brilliant to see his iterative design process continue in response to feedback from those using it on the ground.” Tłuszcz has received €34,000 along with two other winners for the inventions The international award was bagged by Yujin Chae Yeonghwan Shin and Yuan Bai for their invention of the Golden Capsule a hands-free intravenous (IV) device for medics Inspired by the harsh environments faced by medics during the Turkish-Syrian earthquakes the device uses elastic forces and air pressure differences rather than gravity to work so that medics in disaster zones do not have to hold up IV packs while transporting patients the sustainability award went to Hoi Fung Ronaldo Chan and Can Jovial Xiao for their invention of E-Coating a device created from recycled glass which can be applied to exterior roofs and walls to reflect the sun’s rays to reduce a building’s heat absorption There were two Irish inventions vying for the top spot at the James Dyson awards this year: Oasis created by Joel Olympio of the University of Limerick and ErgoTech Oasis is a wearable device that helps people with attention deficit hyperactivity disorder (ADHD) to focus on the task at hand while ErgoTech develops ergonomic laparoscopy tools to improve surgeons’ comfort and reduce wrist strain while performing surgery 10 things you need to know direct to your inbox every weekday. Sign up for the Daily Brief Silicon Republic’s digest of essential sci-tech news editorial@siliconrepublic.com director general of the Luxembourg Financial Sector Supervisory Commission (CSSF) said that the use of AI in the financial industry was “a positive thing” but that risks need to be catalogued and managed He was speaking during the Elvinger Hoss Annual Regulatory Forum Library picture: Claude Marx seen speaking at the Cross-Border Distribution Conference AI probably will not “replace humans” in the financial industry but can enhance their work by automating low-value administrative tasks according to Luxembourg’s top financial regulator while a venture capitalist highlighted potential significant reductions in administrative positions The use of AI technology is unlikely to “replace humans” in the financial industry the head of Luxembourg’s financial regulator said during a legal conference although a venture capitalist speaker said cuts in administrative positions were entirely feasible AI has got the potential to improve existing processes and replace some of the lower value-added administrative drudge work But Marx said that “the risk of humans being completely replaced [by the technology] is remote.” Marx was speaking at the 2024 Elvinger Hoss Annual Regulatory Forum The conference was mainly geared to legal and compliance professionals in the banking sector Just as the internet and apps have not replaced banks it’s a positive thing,” Marx said in his keynote address allowing staff to focus “on more value-added tasks.” “Actual use” by financial firms in the EU at the moment “is still limited” Marx cited a recent European Securities and Markets Authority study that found only 65 out 22,000 investment funds examined disclosed use of AI or machine learning better risk adjusted returns or lower expense ratios While Marx was positive on AI overall--saying the technology “should be used”--he did flag potential issues Financial firms need to set clear guidelines on which processes will be automated and how to mitigate risks Marx said risks include data quality risks which allows companies to reduce costs without disclosing the use of the technology and without a corresponding reduction in fees Marx said regulators and the industry lacked accurate data: “we don’t have it right now.” The CSSF and Luxembourg Central Bank (BCL) will shortly field a survey of banks and investment firms on their use of AI and how they monitor AI risks Marx said they aimed to publish the results “before the end of the year.” During a separate panel discussion held earlier at the same conference co-founder and CEO of Mangrove Capital Partners and chair of Wix The question for bank executives was “will you embrace” change “or not” The VC investor and technology executive warned that “if you don’t think AI is coming for your lunch banks should start by focussing on what he called “the basics” Tluszcz called it “boring” and said it was difficult to motivate people to work in the compliance function Taking an AI system and plugging it into a bank’s workflow could reduce personnel costs by 30%-50% The potential to cut administrative headcount by a quarter or by a half “that’s pretty good,” Tluszcz stated during the panel discussion the “single biggest opportunity” for Luxembourg banks was shortening the time it takes to open an account “Why does it take two months to open an account in Luxembourg?” he asked Tluszcz recalled that he recently phoned his bank’s customer service centre and spoke with a “real person” “these things will disappear” and be replaced by bots banks should use AI to introduce “truly personalised service,” such as an “assistant” that can converse with clients programmed with the institution’s own verified data and in-house jargon could create a “very personalised relationship” with customers The heads of banks in Luxembourg “not willing to invest in” and embrace AI “will no longer be CEO of that bank in five years.” CEO of Edmond de Rothschild Europe and chair of the Luxembourg Bankers’ Association (ABBL) cited a project run by the University of Luxembourg’s SNT centre the ABBL and local banks that is developing an AI system to conduct anti-money laundering due diligence for financial institutions The system aims to “reduce 90% of human intervention in detecting [know-your-customer] issues.” But a human staff member “still needs to check” what he called “the last mile” of the process Stein said that more than 60% of Luxembourg banks have an AI project of some sort and more than 70% provide access to ChatGPT or similar tools to their staff Please enable JS and disable any ad blocker Mark Tluszcz, chairman of Israeli website building platform Wix.com Ltd. (Nasdaq: WIX) and co-founder and CEO of Mangrove Capital Partners which owns a 20% stake in the Nasdaq-traded company is one of the world's more unconventional technology investors He has appeared on the Forbes Midas List of top tech dealmakers on three occasions and was the first investor in Skype - which raked in nearly $3 billion for its shareholders at exit His unorthodox opinions have made him a favorite of the television networks as someone who can be relied upon to say something controversial and provocative Tluszcz does not believe in online music ventures “I am highly critical of music startups because you cannot make money out of them,” he tells Globes “G” magazine in an exclusive interview My business is based on buying low and selling high in contrast to the trend in recent years among the VC community of paying exorbitant prices for startups Everyone is looking for unicorns - companies worth a billion or more - but I say most of these unicorns are fakes.” "There's a big gap between private markets and public markets Other companies present no revenue and are priced on the private markets at a billion dollars Either we are actually worth $5 billion - which would obviously make me very happy - or these other companies are worth significantly less “We went public with Wix at the end of 2013 at the same time as many of these companies most of which are now traded below their IPO prices Some of these startups celebrated winning the World Cup before ever reaching the finals." How many companies fall into this category "They say there are 200 unicorns in the world The top ten - like Uber and Airbnb - are truly global phenomena but most of the rest celebrate victory before the game Wix always believed that first you play the match The way it reached a billion-dollar valuation was that someone invested $20 million for 2% of the company based on a value of a billion dollars so some idiot wanted a small slice of Shazam and was willing to pay a lot for it That isn’t a real capital round and it's not a real value Both iOS and Android now have similar products “One company that was popular - and we regretted not investing in it for years - was Evernote but when we invested in Wix we said no to Evernote what a mistake we made.’ It was a great idea but there was no business model behind it and they were worth $2 billion on paper because that's what somebody wrote every browser in the world offers something similar." Let’s talk about trends like Fintech - online financial services Many believe that that's the next big thing "Billions are being poured into this field There hasn't been too much innovation in this area The most successful Internet company in the field is PayPal - and it’s already 18 years old but the banks went ahead and did it themselves; nothing has happened since ‘Send us your money and you'll make profits.’ But people don't send money that quickly It's easy for people to use various online services but they are much more cautious and concerned when it comes to their money most of the financial services are just improvements what already exists and it really is the darling of London investors I think Western Union has been around for a bit longer But “cheaper” isn't interesting I think there will be lots of changes in financial technology but only smaller businesses will come out of it So you don't share the view that an earthquake is on the way It will take more time until we see an idea that will really reinvent banking.” the only company in Mangrove’s portfolio that Tluszcz agreed to chair - because with its entrepreneurs and its future; and also because he anyway promised to sit on its board as long as he is wanted, after leading the company to take a big gamble on its future a few years ago one of the few funds that have two billion-dollar companies and I can tell you that until Wix started showing results there was a great deal of pressure For the first time since Skype everyone was saying but for seven years I asked myself every day whether I could do it again And not only was I putting myself under pressure but everyone around me said: ‘We're sick of hearing about Skype; have you done anything big apart from that?’” Did the success of Skype affect how you dealt with Wix and I came to the founders (CEO Avishai Abrahami H-V.) and told them I did not believe it was right to sell At the time - before the IPO - the founders and I had much bigger stakes in the company and we were looking at a lot of money for each one of us which turned into a question of confidence between me and them ‘You can be worth much more’ and the fact that I had Skype on my record gave it weight.” but on condition that you stay on the board as long as I want you there but it's the kind of symbiosis there has to be between an investor and a company because there are ups and downs along the way and the risk is very great And now we have created a dynamic in the Israeli technology community that it's possible to grow a big company here What were some of the considerations in favor of selling the company at the time One of the limitations of Israeli venture capital is selling companies too soon; but still I completely understand why they want to sell There need to be more Wixes around to give people the courage to reject an exit and say ‘There can be a big company here.’” The next stage was the IPO two and a half years ago Tluszcz has deepened his commitment to the company by becoming chairman of its board Wix certainly displays the behavior of a genuine unicorn with Superbowl commercials and a contract with English football giant Manchester City You invested in Wix when it was still a very young company "I met the Israeli angel investor Ran Tushia in Spain can you take a look?’ I checked them out and right away said I wanted in any business that wanted an online presence needed to pay $10,000-$15,000 just to build a website and it was obvious to us that in the future every business would need to be online I was involved with Skype and I love the idea of free It's the easiest way to amass users - and no one can beat you on price.” But free services do not generate much revenue The difficulty with freemium is that you have to give enough to make people want to use it and keep back enough to make people willing to pay for something The model was easy to find with Skype: computer to computer calls were free but if you wanted to call a mobile telephone you had to pay At Wix we examined maybe twenty ways until we arrived at the model that is now responsible for all our profits: you can use the services for free as long as the word Wix appears on your site we have nearly two million paying customers.” Wix is still not a profitable company - at least but technology companies can reinvest all their funds to focus on revenue growth and at the same time build the next generation of products Technology companies have a disease: they succeed once They make a lot of improvements to their existing products but whoever stops inventing will eventually be replaced by someone who comes along and invents something better than he has “You need to find the balance between medium-term profitability and short-term innovation and that was one of the things that attracted me to the Wix entrepreneurs ‘We want to build a company for the long term’ and when I see the six products we have in the lab right now When my 13-year-old son came home from school and told me a girl in his class made a presentation with Wix I knew we had something really big on our hands.” "We will be profitable when we decide that that is what we want All we need for that is to stop our marketing efforts for a few months.” "A combination of factors worked against us: a new company Many Israeli companies have not been a great success as public companies and that's because they did not respect the unwritten contract with the analysts which says ‘No surprises.’ It took us two years to gain their trust.” you will need to exit at some point and move on and we will eventually have to make an exit as part of our commitment to shareholders and investors and regardless of the holdings I have and will have I have an obligation to chair the board for five years.” divides his time between his homes in Luxembourg and Barcelona to an American businessman father and a Zimbabwean mother “It’s time for you to become an American,” and sent him to improve his English - French is his mother tongue but my vocabulary was perhaps 500 words.” After a year of high school and four years in college he left the US because he felt more European than American At first he landed in the Canary Islands; “My best friend had a few hotels and I begged him to let me work as a pool boy or a waiter come home to the US and find a proper job.’” he stopped in Luxemburg to visit another friend where he opened the newspaper and noticed accounting firm Arthur Andersen (which eventually broke up because of the Enron scandal) was recruiting “I’m a big believer in things happening for a reason I didn't have a degree in accounting but in history people thought that an open mind and broad horizons were important History is my passion and in a strange way I think it has made me better able to evaluate people and that is what I focus on when we invest in companies.” He worked at Arthur Andersen for ten years and spent the last two as the firm's venture capital fund manager two years before the big scandal - speaking of things that happen for a reason - he decided he wanted to be his own boss and founded Mangrove but for the following stages that's very small and the dynamic of our business is such that if you want to make money Our profit derives from the investors’ profit; in order to make a profit you first need to repay the fund and the statistics of venture capital are clear The moment the funds crosses the $200 million mark how often do you get a company like Wix in your portfolio you need two of those to achieve good results It is fair to assume that Mangrove paid back its original investment in Wix at the time of the IPO as its initial investment amounted to $3 million Mangrove was founded 15 years ago and has made 150 investments at an average of $500,000 to $1 million per company and of course sometimes there are follow-on investments One field which Tluszcz believes has reached the end of the line - “apart from special ideas” - is e-commerce but that what is far from having exhausted its potential is online services the Mangrove portfolio includes a company that allows users to order online housekeeping services It's a company that faces quite a few difficulties since it's not all that customary in that industry to keep paperwork and pay taxes Tluszcz believes it can nevertheless change a few habits and what he's now looking for is an investment in an "old-age home at home" online services that could replace expensive retirement homes that force old people to change their routines and leave home and provide the required services in the existing home But his main goal these days is to solve a larger problem: how to disconnect we need to do a few things to maintain our sanity,” he says “to spend time in conversation without looking at a smartphone I want to figure out how that translates into a business I believe that finding the balance between connectivity and the need to stay sane and human will be a sizeable challenge and the next big thing.” Israel business news - www.globes-online.com - on May 30 2016 © Copyright of Globes Publisher Itonut (1983) Ltd ShareSaveInnovationAI & Big DataVC Slams Silicon Valley Heavyweights For Poaching London’s Top Startup TalentBySam Shead ShareSaveThis article is more than 5 years old.Google CEO Sundar Pichai at Google's Kings Cross office in London Silicon Valley’s aggressive push into London has been met with positive headlines but could turn out to be disastrous for the city’s flourishing tech startup ecosystem which is the largest in Europe by some distance Facebook and Amazon have announced plans to hire thousands of staff at swanky new London offices in the last couple of years and they’re poaching talented individuals from London’s big name startups—think meal delivery app Deliveroo ID verification platform Onfido and simulated worlds startup Improbable—in order to fill their shiny new glass boxes tech giants—who at home face antitrust probes and mounting public anger over data hoovering and privacy lapses—have been welcomed to London with open arms by Prime Minister Theresa May London Mayor Sadiq Khan and countless other politicians But their presence could turn out to be something of a curse a partner at VC investors Mangrove Capital Partners and the chairman of website building platform Wix said the arrival of Silicon Valley en masse is a “looming problem” for U.K hailing the issue as a bigger threat than Brexit Venture capital partner and Wix chairman Marc Tluszcz “They’re calling up all the companies you can imagine and saying I’ll pay you twice what you earn at your startup,” said Tluszcz “That’s okay if you’re only hiring 100 people or 200 people But these guys have decided to make London a massive hub and with that comes a danger.” Google is building a campus for 7,000 people behind King’s Cross train station while Facebook announced at the end of 2018 that it was leasing two large buildings down the road bringing its total London workforce up to around 2,300 staff the beating heart of the London startup scene Amazon opened a new office in 2017 that increased its total U.K and in the short term it is kind of cool to have Google and Facebook here,” said Tluszcz who made $200 million off an early $2 million investment in Skype “But in the long term it’s very unhealthy because it sucks up the finite resources you have.” a job board for tech companies and startups in the U.K. said poaching talented individuals from fast-growing startups is a “standard practice” for Silicon Valley firms “When Silicon Valley companies expand or establish themselves in London the default step is to look to companies like Deliveroo and ‘acquire’ a vast number of their most talented people,” said Buckley Their goal is to acquire a large volume of quality talent as quickly as possible By targeting the likes of the companies mentioned they can make assumptions on the calibre of talent given how rigorous those companies vet prospective employees.” This hiring spree is good news for talent but a headache for the founders of British and European startups It typically takes six to 12 weeks to identify interview and hire an experienced software developer in London “Now extrapolate that to needing to hire hundreds of developers (like in the case of Deliveroo for example) and you have an enormous and costly logistical challenge,” said Buckley “Compound that challenge with a Silicon Valley giant moving into your neighborhood and acquiring a significant proportion of your staff and it can have a profound and far-reaching impact on the companies’ ability to scale and meet investor expectations.” said Silicon Valley firms are causing a lot of startups to feel pain Facebook has poached seven engineers from software startup Qubit and fashion website Lyst in the last couple of years and Google has poached three engineers from Qubit A quick scour on LinkedIn reveals multiple cases of people leaving London’s unicorn companies (those valued in excess of $1 billion) to join Silicon Valley firms Improbable seems to be one of the hardest hit in recent years with Google poaching around a dozen engineers and recruiters from the SoftBank-backed virtual worlds startup Bill Cranfield and Sam Corcoran have all left Improbable to join Google in engineering roles over the last two years while Roxanna Aliabadi left to join Google as a product manager tech giants have been stealing Improbable’s technical recruiters to help them find more staff Improbable lost talent partner Andrew Pickup to Google in March 2019 where he now works as a technical recruiter and technical recruiter Francesca Barile left to join Amazon in February 2019 there have also been several high-profile departures to Google and Facebook who led the product team that built the Deliveroo driver app left his senior product manager role in May 2018 to join Facebook as a product manager while data scientist Giacomo Giussani left to join Google in August 2018 Deliveroo told Forbes that it welcomes the presence of global tech firms in London and downplayed the impact they have on its ability to hire and retain talent A Deliveroo spokesperson said: “Deliveroo is attracting world-class tech talent from all over the globe and the capital’s growth as a home for international tech expertise only helps with recruitment International firms increasing their presence in London is a vote of confidence in U.K tech and and something we should all welcome.” Paul Sarbinowski left his job as a security engineer in November 2018 to join Google in the same role told Forbes that there’s two-way traffic between his company and the Silicon Valley firms “The big tech giants are looking to hire as many as they can the giants are starting to feel more like corporates,” said Kassai “We’re equally finding that seniors want to join startups.” Kassai said Onfido hired its VP of AI research from Amazon while its CTO used to work at Spotify and Adobe we may as well hire from them—they have a bigger talent pool,” he said but it does count for a lot in a city like London where the average house costs $610,000 (£480,000) and the average pint of beer is $6.58 (£5.19) junior software developers earn on average $38,000 (£30,000) senior developer are paid $79,000 (£62,000) and a CTO should be on around $185,000 (£145,000) according to data from jobs website Glassdoor British tech salaries are dwarfed by the pay packets at the U.S tech giants where mid-level engineers can earn an annual salary in excess of $127,000 (£100,000) and executive and management positions can be much higher have gotten out of hand,” the recruiter said While Silicon Valley firms are offering a lot of money to their U.K “There’s an awful lot of incredulity from U.S.-based tech folk that London pay is so low by comparison to the West Coast,” said Buckley Potential recruits not won over by the generous pay and stock options could also be tempted by lavish canteens barista coffee and other bougie benefits offered by the tech giants Silicon Valley firms have also invaded Tel Aviv in Israel and Tluszcz says firms like Google are constantly trying to poach his staff at Wix Tluszcz refused to disclose how many staff had made the switch “I don’t think London should be at all afraid of Brexit,” said Tluszcz “But I think they should be afraid of these large U.S companies setting up huge facilities here.” Some plucky upstarts are able to hire staff away from Silicon Valley by offering them stock in their companies has hired a number of staff from Silicon Valley firms used to be an online operations manager for Google used to work at Snap as a customer operations manager There are also plenty of people that leave the likes of Google and Facebook to launch their own startup All you have to do is attend one of the Xoogler events to see a bunch of former Googlers pitching their new companies GP Bullhound predicted that Europe will have its own $50 billion tech “titan” by 2021 But if Google and Facebook continue to poach from U.K then it’s going to be hard for the small island nation to spawn a tech behemoth of its own It has been over ten years since Mangrove CEO Mark Tluszcz met Dan Adika (pictured) from WalkMe "He is able to work six and a half days a week fifteen hours a week to continue developing his project," says Tlucszcz He tells me he thinks he has found a great company and asks me if I want to see them." The appointment is made CEO of Mangrove Partners Mark Tluszcz comes out ruffled “The energy and vision of the founders was such that it was easy to be investors and shareholders of the company that shows the time needed to build these [outfits] it is more around eight to ten years," he said via videoconference “A listing is a stage in the life of a company You enter the big leagues through the front door but you have to be part of the board of directors to share your experiences We were very involved in setting up the listing we'll see the market's appetite." WalkMe publishes software that facilitates support for digitisation in particular via an interactive approach to guide the use of a website It will sell up to 10.5m shares with a value of $268m to $340m which will market the Israeli company at a range of $2.4bn to $2.7bn the company has raised $308m from investors such as Insight Partners revenues of this company--which has as customers such players as Linkedin Chevron and AstraZeneca--increased to $42.7m the company closed with revenue of $148.3m when you list your company on the stock exchange this is one of the questions shareholders ask themselves there is at WalkMe a large laboratory of the future which is looking for avenues of diversification It is still early days to talk about it,” the CEO of Mangrove says “The sine qua non of going public is to be able to answer this question The nature of the stock market is draconian: every three months you have to open your kimono and show who you are with analysts who know the company almost better than you We've seen what's under the hood through the front door and not through a special purpose acquisition company “There are entrepreneurs who rightly say they are unsure of the future and sell There is also a certain glory in being listed on the stock exchange Every five to ten years you have one or two projects like this we didn't know when we were going to be okay shareholders who have confidence in the team and in the future,” says Tluszcz This article was originally published in French on Paperjam and has been translated and edited for Delano You are currently accessing unquote.com via your Enterprise account If you already have an account please use the link below to sign in If you have any problems with your access or would like to request an individual access account please contact our customer service team Phone: +44 (0)203 741 1137 Email: Georgina.Lawson@acuris.com Unquote is an essential working tool for private equity professionals Request a free demonstration to find out more These RSS feeds are provided for personal use Re-publication of unquote articles via RSS on another website is a breach of copyright and is prohibited Unquote's expertise and reputation enable us to deliver a series of market-leading events including our popular British Private Equity Awards and regional conferences Click here to see our forthcoming events calendar If you encounter issues logging in with your credentials, please contact our customer services team and we will endeavour to assist as quickly as possible research and analysis on the European venture capital and private equity markets Request a free demonstration or subscribe now To discuss our subscription options, please email analytics_enquiries@iongroup.com or call +44 (0)20 3741 1329 © Merger Market London EC4R 1BE - Company registration number 03879547 Digital publisher of the year 2010 & 2013 Hans-Jürgen Schmitz--along with Mark Tluszcz and Gérard López Fojaca--founded Mangrove Capital Partners in 2000 seeing opportunity in the then-nascent ecosystem of tech companies in Europe Delano is talking to local venture capitalists to discover their investing habits as well as their views on how the field is evolving In this edition Hans-Jürgen Schmitz of Mangrove Capital Partners discusses tech startups and the tech investment outlook Founded in 2000 in Luxembourg and opening another office in Tel Aviv in 2010--and now with presences in Berlin Barcelona and London as well--Mangrove Capital Partners has €1bn in assets under management and was an early investor in the likes of Skype and Wix It invests in technology and follows three megatrends: health technologies education technologies and tools that help small businesses become more efficient “A technology or a product,” says Hans-Jürgen Schmitz a startup’s idea doesn’t need to have a use-case or a defined set of customers for the firm to potentially take interest “[It could be] something that is so fundamental,” he explains “that you’d have to take a crystal ball… and say there are a lot of drivers that could make this technology turn into relevant applications.” One such technology is the one being developed by brain.spaces Its entrepreneurs are seeking to build a database that would Future applications could be in the health/safety sphere (e.g monitoring a pilot’s present state of mind) but the core underlying technology doesn’t yet exist But Mangrove also looks at startups whose products do already have use-cases and a foreseen user type I could see [myself using] this” then for him that’s already a red flag “We’re looking for something that creates a ‘wow’ effect.” The second criterion is whether the product fits into one of the megatrends defined by the company a trend that won’t be reversed in the near future Luxembourg-based freight management company Shipsta is an example of this type from Mangrove’s portfolio Its team has the industry experience to know what kind of tool can cut through problems that shipping companies face He looks for industry expertise combined with prior experience in building/scaling a company: “Many times it’s not the product itself that failed--or the reason why the business failed--it really is the team around it.” Fundraising skills are also important: “When people come to pitch us we want to get the sense that they can convince not only us is difficult to read,” says the managing partner in response to this question He contextualises this by discussing the “breakout years” of 2020 and 2021 when the amounts of money invested were “outright crazy” and which fed into a 2022 marked by a major slowdown in growth falling stock market values and erosion of confidence in public markets is the “big cleansing wave” of mass layoffs across the tech industry “Everybody realised that they had hired way too many people without any discretion during covid,” he says Investors have told companies to get back to profitable growth “We’ve gone from exuberance in capital abundance to capital scarcity We’ll have to see where we find a middle ground.” The challenge for VC companies is thus finding the way through that middle ground The question will be when and to what extent confidence in the markets is restored there is a lot of [it] sitting on the sidelines looking to be invested.” He isn’t sure this is an opportunity but in his experience a wave of good news can restore confidence and reopen the floodgates of investment “[Although] hopefully not the same insane (sometimes) portions that we saw in 2020 and 2021.” the general public sees venture capitalists as a complete black box,” says Schmitz “[But VC] is the necessary ingredient of fuel to create tools that people in their everyday life will use and come to appreciate.” As Luxembourg-based examples he cites Salonkee an online reservation site for beauty services a mobile-based platform that matches employers and job-seekers “These are very tangible tools that are being developed only because venture capital is available.” “Banks… will not invest in such risky endeavours.” which uses AI platforms to bring basic healthcare to people who otherwise wouldn’t have it the second clearing bank to be authorised in the UK in the last 250 years and which uses a blockchain-based transaction platform to do clearing transactions more efficiently an AI tool embedded in a camera that can determine Frédéric Surdon has been CEO and managing director of Société Générale Luxembourg since 19 October 2023 The January 2025 issue of Paperjam magazine is devoted to the 2024 edition of the Paperjam Top 100 the ranking of Luxembourg’s most influential economic decision-makers Here are the personalities ranked between positions 81 and 90 has been CEO and managing director of Société Générale Luxembourg since 19 October 2023 He joined the Société Générale Group in 1995 including global head of asset finance until August 2023 A member of the board of directors of Société Générale Luxembourg since 2019 Surdon holds an MBA from Essec and a civil engineering degree from ESTP has been CEO of the Luxembourg Institute of Governance (ILA) since 1 March 2023 he held the position of deputy CEO at Luxembourg for Finance for almost four years He also sits on the boards of the Luxembourg Sustainable Finance Initiative (LSFI) and the Luxflag fund labelling agency von Restorff was an adviser to the management committee head of communications and secretary to the board of the Luxembourg Bankers’ Association (ABBL) has been deputy CEO and general counsel of the Association of the Luxembourg Fund Industry (Alfi) since 16 September 2024 She has over 25 years of experience in the Luxembourg fund industry After starting her career in 1998 as a lawyer at A&O Shearman and Clifford Chance Lamesch joined Fidelity International in 2008 where she was appointed head of Luxembourg in 2017 she was its chairperson from June 2019 to June 2023 is an architect recognised for her significant contributions to contemporary architecture in Luxembourg A 1994 graduate of the École spéciale d'architecture de Paris Notable achievements include the Maison des sciences humaines in Belval and the ‘Vivre sans voiture’ project in Luxembourg Fabeck was nominated for the Mies van der Rohe Prize a prestigious European architectural award She is also active in professional associations having been vice-president of the Luxembourg Center for Architecture (Luca) from 2013 to 2019 and president of the Valentiny Foundation since 2014 has been CEO of the Luxembourg Bankers’ Association (ABBL) since 1 April 2022 His banking career began in 1996 at Banque Internationale à Luxembourg (Bil) notably in credit analysis and business development Grbic joined Banque Degroof Luxembourg to develop the local market A graduate of the Institut supérieur d'architecture de la communauté française (ISACF)--La Cambre he began his career as a freelance architect from 1994 to 1996 He then joined Bétons Feidt in 1996 as director The company has expanded to 14 sites in three countries Feidt is also a director of Carrières Feidt and Recyfe reflecting his commitment to the construction and recycling sector is co-founder and CEO of Mangrove Capital Partners Mangrove has invested in over 120 companies Mark has been chairman of Wix.com since 2016 and sits on the boards of several technology companies Tluszcz is known for his bold approach to investing is managing director of Arthur Welter Transports After completing a transport apprenticeship in Germany from 1986 to 1989 where she took on various responsibilities notably in the freight forwarding and logistics department the company expanded its international activities employing around 770 people and operating a fleet of 800 vehicles Welter is also president of the transport group of the Confédération luxembourgeoise du commerce (CLC) is renowned for his contributions to the technology sector After studying at HEC Paris and earning an MBA at Harvard Business School an online banking joint venture which he ran until 2010 a company specialising in social media analysis which he transformed into an international company employing more than 450 people and which was sold in 2024 to the giant Hootsuite Glaesener sits on the board of Governance.com and has been a member of the business federation Fedil since 2019 is managing parter of the Luxembourg office of A&O Shearman which was formed from the merger between the Allen & Overy and Shearman & Sterling law firms in 2024 real estate and infrastructure clients on complex transactions and tax structuring for over 20 years Université Panthéon-Sorbonne and King’s College London He is an active member of Alfi and the Luxembourg Private Equity & Venture Capital Association (LPEA) This article was written in for the  magazine The content of the magazine is produced exclusively for the magazine It is published on the website as a contribution to the complete Paperjam archive Is your company a member of the Paperjam Club You can request a subscription in your name Mark Tluszcz of Mangrove Capital Partners is pictured during a press interview in December 2014 His VC firm said on 19 July 2017 that it had raised nearly €150m for its latest fund Mangrove Capital Partners will invest in early stage companies, its CEO, Mark Tluszcz, said in an interview with Bloomberg published on on 19 July The latest fund is the 17-year-old firm’s fifth The vast majority came from previous investors including around 20 pension funds and high net worth individuals The fund will invest in European and Israeli startups, Business Insider UK reported on Wednesday Tluszcz said in a statement published by TechCrunch: “We like to take big bets very early and support our best portfolio companies through multiple rounds of financing to build material stakes We prefer to invest in unproven or unusual technologies rather than chase the latest fad.” Mangrove has backed a total of 130 startups Today it manages more than $1bn from its offices in Luxembourg The VC firm made $200m from its $2m investment in Skype and $550m on its $8m stake in Wix.com seen speaking during the Elvinger Hoss Annual Regulatory Forum partner at Elvinger Hoss Prussen; Mark Tluszcz co-founder and CEO of Mangrove Capital Partners; Françoise Thoma chair of the Luxembourg Bankers’ Association (ABBL) seen during a panel discussion at the Elvinger Hoss Annual Regulatory Forum chair of the Luxembourg Bankers’ Association (ABBL); Anne-George Kuzuhara advisor at Luxembourg’s finance ministry; and Henri Wagner The Elvinger Hoss Annual Regulatory Forum was held at Mudam on 5 June 2024 senior associate at Elvinger Hoss Prussen; Katrien Veranneman partner at Elvinger Hoss Prussen; and Delano’s Aaron Grunwald seen during the Elvinger Hoss Annual Regulatory Forum The head of Luxembourg’s financial regulator told the Elvinger Hoss Annual Regulatory Forum that he’s not exactly a fan of personal finance influencers like Kim Kardashian flogging crypto on social media Luxembourg’s top financial watchdog has blasted the clout of influencers and critiqued regulatory agencies’ own mastery of social media called for increased financial education (“which starts at school”) to offset the increased popularity of social media influencers and (known as “finfluencers”) The impact of influencers is “not easy to deal with,” said Marx Consumers are not always equipped to evaluated influencers’ statements But influencers are “a fact of life” and regulators have fallen short Regulators are “not good at Youtube and even worse at Tiktok... I wonder if we should pay influencers” to get proper financial messages out Marx said he “only half joking” about hiring influencers because authorities “can’t expect customers to check” their own websites chair of the Luxembourg Bankers’ Association (ABBL) and CEO of Edmond de Rothschild Europe who referenced the recent announcement by that it was abruptly dumping thousands of mass retail clients in Luxembourg Stein commented dryly that there had been some “reshuffling in the retail banking market” but said he was pleased by the “very fast response by other players” in taking on customers who need to switch banks in a hurry partner at Elvinger Hoss Prussen and president of the Luxembourg Bar; partner at Elvinger Hoss Prussen; Anne-George Kuzuhara co-founder and CEO of Mangrove Capital Partners and chair of Wix; and The firm said that 121 people attended the Elvinger Hoss Annual Regulatory Forum in-person and Reckinger said in his remarks that there were about 200 more attendees online He said the next edition of the conference