1Mby1M Virtual Accelerator Investor Forum: With Luis Gutierrez Roy of Telegraph Hill Capital (Part 3)

Sramana Mitra: What about other countries in Southern Europe? What else are you tracking and where do you see activities that are interesting?

Luis Gutierrez Roy: We just made an investment in a company that was actually started in the US but eventually moved to Bulgaria. The founding team was in the US. When they finished the program, they decided to move back to Bulgaria where their product and development team is based.

The reason is because the market they were addressing is essentially the European market. Their solutions help airline passengers to claim delayed or cancelled flights.

There’s a European regulation that provides for this kind of reimbursement to happen. This regulation does not apply to other geographies. It’s specific to EU countries and EU airlines. It makes sense for them to move to Bulgaria and focus on Eastern European countries. There’s a lot going on in Eastern Europe.

Sramana Mitra: We’ve covered quite a bit of Czech Republic and there is some very interesting stuff going on there. They have actually produced unicorns.

Luis Gutierrez Roy: Yes. One example is Apptopia. They’re based in Boston. However, a big part of their development team is in Kiev. They’re doing a phenomenal job. It’s not uncommon to see more and more distributed teams where a lot of their engineering talents are based in Eastern Europe.

Sramana Mitra: As companies get to Series C or Series D, putting a sizable presence in the US is not a bad idea to get to more of the exit discussions. The Indian companies have done this very effectively.

These days, they do seed and Series A in India. Series B onwards, they start putting a strong toehold in Silicon Valley so that they are part of the exit discussions. What else should I have asked you?

Luis Gutierrez Roy: I think it’s interesting what you mentioned on micro-funds. There’re a lot of funds out there that are in the early stage. The truth is, we’ve always positioned ourselves as the vehicle of choice for LPs in Spain to access qualified deal flow in the US.

For early stage investors or LPs based in Europe, it’s extremely difficult to access good startup companies in California or Boston. A lot of the funds that traditionally invest in those geographies do not necessarily raise funds in Europe, let alone, places like Spain.

Having lived in the US, I always thought that there has to be a way for those investors to access the US market without having to write a $20 million or $50 million check.

There’re a lot of family offices. Most of our investors are family offices. There’s a lot of those who will invest half a million to $3 million in any given fund. They just could not easily find funds with a US perspective.

We see a lot of LPs in Europe that are invested in European VCs. Some of them are domestic or invest in a particular country. Some of them are more regional. Not many of those will be able to invest in US or Canada. There’s a lot of risk aversion on the LP side on this side of the pond.

Sramana Mitra: Thank you for your time.

This segment is part 3 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Luis Gutierrez Roy of Telegraph Hill Capital
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