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The Only Thing That Matters
Welcome to "The Only Things That Matters", where we deconstruct the path to product-market fit of successful founders and extract the principles and frameworks behind their success so that you can apply them too.
The Only Thing That Matters
Scaling to $50M in revenue over 18 years with Timo Buetefisch (Cooltra)
Timo Buetefisch is an entrepreneur like no other.
He's the founder of Cooltra and he is still running the company after 18 years.
Not only that, he's grown Cooltra "slow and steady" to over $50M in annual revenue over that period of time.
Learn how Cooltra grew from a humble bootstrap startup to a booming enterprise with 28,000 electric vehicles and 550 employees across nine countries.
In this episode, Timo also opens up about the biases entrepreneurs often face when forecasting revenue and the critical importance of maintaining realistic business plans. What if your entrepreneurial projections are setting you up for failure? Timo has been there and wants to prevent you from doing the same.
He discusses the evolution of Cooltra's business model, the strategic move into moped sharing in 2016, and the subsequent influx of equity funding that fueled their rapid expansion. Discover the teamwork and strategic choices that allowed Cooltra to thrive in a fiercely competitive market.
But it's not all business. Timo also opens up about the pressures of entrepreneurship and the impact of an intense work ethic on personal life, including his own. He reveals the vital role of peer learning networks in maintaining a work-life balance and long-term well-being.
This episode isn’t just about business growth; it's about surviving and thriving in the entrepreneurial world while keeping personal sanity intact. Tune in for an honest, insightful conversation that could reshape your entrepreneurial journey.
Yes, the good thing is normally what happens. You forget more of the bad moments and you remember the good ones. So it's a little bit the bias which helps us to always look for there were many moments that were of difficulty. Especially, what happens to many entrepreneurs is that you overestimate the revenue potential Because you take it more like an Excel exercise at the beginning. You make your numbers, you build your forecast and the problem is reality normally doesn't go that way that you hit the revenue targets and costs. On the other side, normally you don't undergo, especially at the beginning.
Timo Buetefisch:We didn't have 100% realistic business plan. It's also because somehow it has to be. You have to be optimistic. So then the problem this translates into higher cash needs. If you don't hit the revenue targets and you have higher costs, that means you're running out of liquidity. These are the difficult moments when you're in this situation and maybe you have raised around or debt facility and you think your run rate was 18 months, but at the end it's only 11. So you're constantly in this mode of raising money and not reaching target targets.
Ariel Camus:Welcome everyone, this is Ariel Camus, and this is the only thing that matters the podcast where I interview successful founders to deconstruct their path to product market fit and to extract for you the principles and frameworks behind their success. My guest today is , the co-founder and CEO of C, the European leader in sustainable mobility solutions on two wheels. Since its founding in 2006, kultra has grown into a powerhouse, with a fleet of over 20,000 scooters operating in 24 locations across 8 countries. The company offers short and long-term moped rentals to both B2C and B2B customers and has pioneered electric moped rentals by the minutes in various European cities. Rentals by the minutes in various European cities.
Ariel Camus:Under Timo's leadership, kultra has achieved remarkable milestones, including a revenue of 45 million euros in 2023, an EBITDA of 7 million euros and over 500 employees. In this episode, we dive into Timo's journey, from his early days in Barcelona to building Kultra into Europe's market leader. We discuss the evolution of the business model, the challenges of scaling an international operation, the importance of choosing the right investors, and the personal sacrifices and learnings along the way With all of you Timo , hi Timo, thank you so. Hi Timo, thank you so much for making the time for this.
Timo Buetefisch:Yeah, what a pleasure. Thank you to have you meet Ariel.
Ariel Camus:No, absolutely. It's not every day that I get to connect with someone who has been doing this for such a long time, and especially with a single company. You have been leading Kultra for 18 years and I can't wait to hear the story of those 18 years. I can only imagine all the ups and downs, but I will. I'll ask you a question that I know it's easy to find out there the answer to it, but I think it makes sense to start there. What is Kultra and where did the idea for Kultra come from?
Timo Buetefisch:Yes, we are a European leader in giving mobility solutions in a sustainable way on two wheels. So this is our main focus. We are basically acquiring e-bikes and e-mopeds and we make them available for users pay-per-use, so by the minute, by the day, by the week, by years, even the companies or residents that are renting for long term. We have both segments B2B and B2C. We have both segments B2B and B2C 60% B2C, 40% B2B and we are operational in nine countries. By now, over these years, we have a fleet of 28,000 vehicles. This is the largest electric vehicle fleet in all Europe and, yeah, we are around about 65 million revenue, ebitda positive. We are three investors by now and, yeah, I have a team of 550 people.
Ariel Camus:It's rare to find a venture-backed company that has achieved the size of Kultra. That is also profitable, and of course it's been a while, and I'm not surprised that at this point you have reached profitability, but it's not an easy feat.
Timo Buetefisch:No, not at all. Where did the idea come from?
Ariel Camus:No, I can't imagine. Where did this come from? Why did you decide to build this? Why you?
Timo Buetefisch:Yeah, maybe a little bit personal background. I'm German but came to Barcelona in 2002 for an MBA at Jese, started one business there. I failed in the flower industry, had to go back to corporate world. But then in 2006, my personal moped broke down. So it really came out of a personal experience or necessity. So I thought, wow, now as my moped, my moto, is three weeks in the workshop.
Timo Buetefisch:I got very used to ride a motorcycle in Barcelona. I think it's an excellent mean of transportation door to door quick. Also, we have very good weather here. So I thought, wow, it would be great during this time if I can rent. And then I found out there are not many places that are renting motorbikes. There were obviously car rental companies or bike rental companies, but nobody in the moped space. So that's how it all started from a personal need, we really bootstrapped. So we bought 25, first motors and yeah, and then went building the company step by step with very little money at the beginning that that's impressive, especially, I think, today, it's easy to believe that, well, hey, there's nothing new about this.
Ariel Camus:There's are so many of these you know, like not right-sharing, like Muppet-sharing companies, but you have probably been alone in the market for a very long time, can you, just so we understand the industry, at which point, in the last, I imagine, 10, 15 years, did you start having like significant competition, as maybe there is today?
Timo Buetefisch:Yes, I think what I have to explain first is how we develop our business model, because it's essential. We really started off with a station-based brick-and-mortar gasoline moped rental to tourists. So it is still part of our strategy right now, but the company now, like I said, 95% of revenue is not doing that anymore. Right? So we did really B2C rental to tourists. Now we are much more focused on B2B and B2C electric free flow. So there has been a huge development. No, so, and that means we also have different kind of competitors. No, and in my case, I see it a little bit different, because this whole trend of the industry and going in shared electric mobility we are all growing the market together.
Timo Buetefisch:It's not only like the moped sharing people. It's the same with e-bike sharing or kick scooter sharing or ride hailing, you know, like Uber and Cabify or even public transport. So it's all about the mobility players. And I would say if I talk about, yeah, players in the market, it's not necessarily my, let's say, direct competitors. No, so, because what you attract is basically people that need to move from A to B in a city and they have been doing this with own vehicles or by other means. What you try to attract these people and shift. It has been a behavioral shift. When I started 18 years ago, let's say when I was younger, people wanted really to own a car. It was like a dream to buy a car and drive that. No, that is by far not the dream of, let's say, generation Z. No, the kids now not the kids, but the young people. What they want is basically access to mobility in an easy way, not having necessarily the ownership and paying per use. So there's a whole. In these 18 years, many, many behavioral shifts have happened.
Ariel Camus:I love that you're also talking about this and talking about other players in the market, as everyone contributing to this vision for mobility right, and that it's much more sustainable.
Timo Buetefisch:I think that's such a healthy way of operating, but at the same time, I imagine I mean it's just a small thing, but imagine we have now so many cars parked in the streets. No, and cars are normally private cars are parked like 98% of the time. It's not very efficient. We could dedicate that space for parks or trees or pedestrian area. Light electric shared vehicles is a really, really benefit for all of us, not only in terms of space, in terms of pollution, because it's zero emission, and obviously also noise is a different aspect, because it's more quiet. So it's a very nice element in this whole, let's say, greener city.
Ariel Camus:I share those values and that vision for the world, but especially for a city like Barcelona. I think it's such a great place for that vision to come true and it's happening. I love that you are contributing to that a lot. Um, I'm I'm a huge fan of like, you know, using kultra, uh, using like like, not just the movements, but also the e-bikes, uh, to move around it. It's just an amazing way, it's super fast. Also like like, a huge fan here. Yet, at the same time, as an entrepreneur, I can only imagine, because of the length of the journey for you as an entrepreneur 18 years running this and the amount of players in the market. I was curious to ask you if you were to describe the story of Kultra through the moments of crisis, the moments where Kultra could have died. Could you tell us a few of those moments? And you said, like, well, that was a very difficult moment and share a few of them with us if you don't mind.
Timo Buetefisch:Yes, the good thing is in normally what happens, you forget more of the bad moments and you remember the good ones. So it's a little bit the bias which helps us to always look forward. No, honestly, like now looking back, connecting the dots, I always realize why things have been happening and after all, now, like looking back, no, I'm really really happy about the journey Operationally. Yes, there were many moments that were difficult, especially what happens to many entrepreneurs, I would say, when you talk to people is that you overestimate the revenue potential because you take it more like an Excel exercise at the beginning. You make your numbers, you build your forecast and the problem is reality normally doesn't go that way that you hit the revenue targets and costs. On the other side, normally you don't undergo.
Timo Buetefisch:So you are always in this issue. Especially at the beginning, we didn't have 100% realistic business plan. It's also because somehow it has to be, you have to be optimistic. So then the problem this translates into higher cash needs. So if you don't hit the revenue targets and you have higher costs, that means you're running out of liquidity.
Timo Buetefisch:And these are the difficult moments when you're in this situation and maybe you have raised around or debt facility and you think your run rate was 18 months, but at the end it's only 11, right? So you're constantly in this mode of raising money and not reaching targets. It's more like a stable company Now. We are able to really do good forecasts and we rarely have deviations of more than 10% in anything. But at the beginning it's like a whole mess the financial planning and treasury and so that was really difficult and that translates into problems that you then sometimes you can't pay commitments you have given with providers or even employees, and that's really difficult to manage. And then the second thing is about personal disappointments on the way. I mean, as you can imagine, not necessarily with employees, but with many other partners or people, but just your personal perception was that the deal was done in a different way.
Timo Buetefisch:And yeah, you learn it also the hard way. Important to make contracts, always with your shareholders, with providers. Leave things written in emails or documents. It's just. I recommend it. Even if it's so clear and you have this, you think you have the same understanding about a topic. It helps so much. I mean it's just, yeah, it's tough business, but it is good to trust. But it's also good to write things down, fix things in contracts, you know so it's also clear.
Timo Buetefisch:No, I mean I've heard about so many or I've personally experienced so many situations. No, where just the two contractual parties have the different understanding about the same situation and it's just so helpful to write things down, which is sometimes at the beginning. It's a little bit more uncomfortable, right, it's similar, it's a different story. But if people get married, I would say it's not bad to have a contract. I mean it takes away the romanticism and the thing, because obviously when you get married you think you will never separate. No, but how helpful it is to have a contract in place. But that's more like a private topic. But in business, I highly recommend to do contracts and leave things in a written form no, I I completely agree with you.
Ariel Camus:Um I. There is this um person that I really admire he's the founder of the conscious leadership group uh jim dumbner.
Ariel Camus:He talks about the four pillars of integrity which he borrowed from other people. He talks about these impeccable commitments or agreements. Right, like you know, you have written down who is going to do what by then and you, you know, stay true to those commitments 90% of the time, like it seems so obvious. Yet on a marriage, you know, often we don't do it because, well, what about, yeah, the romanticism? But it's so much harder to find these agreements in the moment where things get hard. It's so much easier to do them up front so that when things get hard, you have a clear, you know, navigational route to follow. And I think that applies to, like, co-founders as well to business partners to clients like transparency, it makes life easier.
Ariel Camus:In my opinion, yes.
Timo Buetefisch:And obviously it's a little bit. You know it's sometimes morally maybe it's difficult to sell because at the beginning everybody new partnerships, new collaborations there's so much enthusiasm but it's exactly on the way. Many things happen, no, and in general, anticipation is very, very necessary as an entrepreneur. So you need to anticipate what things can happen and you need to anticipate worst case scenarios and you need to have cash for situations that things don't work out. So sometimes, even if we're building up new teams, we sometimes hire a person extra. You know why? Because it can happen for many reasons that, for example, you need two new commercial people. Right, and maybe it's better, instead of hiring two, hiring three, because if they three do outstanding performance, they pay their salaries anyhow. So you keep the three. But my experience is often that also people after a few weeks decide to leave for any reason or you are not happy with somebody. So sometimes anticipation is not bad.
Ariel Camus:Absolutely, and, by the way, we cover a lot of these principles and frameworks and rubrics that help us make good decisions as entrepreneurs in the podcast. But I'm also a huge fan of stories and I can imagine, with 18 years of journey, you have plenty of those good decisions as entrepreneurs in the podcast. But I'm also a huge fan of of stories and I can imagine, with 18 years of a journey, you have plenty of those. Uh, what's been the story of the moment that you might recall having the biggest, you know, doubts about whether things were going to work on or if you had, you know, enough energy to continue what? What's been the most difficult moment in your story so far with Clotra?
Timo Buetefisch:Well, I think it was after two or three years when we saw that scaling up. I think we opened Valencia, mallorca, next to Barcelona, as new locations and things didn't work out as planned, because opening new locations is always difficult finding places, finding people, finding customers so it took us much longer. No, so we are running out of cash in difficult times. No, so we have to scale down again and somehow get more money on board. Do discounts to customers? Yeah, really manage the cash. Managing the cash is so key. At the beginning of the venture, you shouldn't look at profit or loss. You should only look at your bank statement, what has happened, because that's at the end, it's the most important thing that you don't run out of cash, because people don't run out of business because they do losses, it's more because they run out of cash.
Ariel Camus:It's very important, absolutely. You mentioned that you started bootstrapping. At what point did you start using external capital to run the business?
Timo Buetefisch:Yeah, that was after one year of business. So we started the company in 2006, in March, and we did a full year of like an MVP. So we did like a product market fit exercise. So we bought mopeds, we rented a small garage. Mopeds we we bought, we rented a small garage. We we basically rented through channels that were easy to manage, like flyering, going into hotels, uh, tourist office building a very simple web page, um, for example. Back then the the apps didn't exist yet, no, so they're different. There was no instagram, right, for example, or tiktok, so channels of commercialization were different, but we basically managed to. I think we reached in the first year 100,000 euros in revenue and, yeah, we lost some money, but in general, we did like a proof of concept, right, so there was people that were willing to pay for our service. That was the summer of 2006. And then we prepared a pitch deck and in February 2007, so 11 months later we closed the first round with four business agents.
Ariel Camus:And if you were to look at the revenue curve of Kultra, is there any specific moment in its history where something changed? That was like a big inflection point?
Timo Buetefisch:Yes, there were several. It was mainly when we changed business models. At one moment, we opened ourselves up to long-term rental, both for B2B and B2C. That was a very positive impact. And then in 2016, we opened up the sharing. So we were pioneers in that. We basically started in Barcelona with 250 shared mopeds and there we went really. We changed also investment strategy, but there was a moment where I raised more than 50 million euros in equity and we really went all in. You know, we knew we had to go fast. So we did a completely different growth path. So it was much more about hyper growth, growing fast time to market, spending a lot of money on marketing. So it was like a completely different growth story. That was 2016.
Ariel Camus:Did that require, I imagine, a big shift in the culture of the company, but also in you as a leader of the company. How did that look like?
Timo Buetefisch:Yeah, no different way of less control, no more delegation. Yeah, hiring more people I don't know. Sometimes we hired, like I don't know, 200 people a year. So that is really a lot. So you double the workforce. So that is really a lot. So you double the workforce. So that's really complex.
Timo Buetefisch:You don't have the systems in place and many things go wrong, but you're less efficient. Then the more money you have, the less efficient you are. But it's part of the game. If you want to really build in a highly competitive environment, you need to go fast sometimes and acquire customers. So that's what basically happened. Now we are more in a consolidation phase. So, for example, in Barcelona four years ago we were 23 competitors in Mopped Share. Now we are left with three Strongly consolidated market. So now you look much more under optimizing cost, giving better customer attention. So you are much more detailed oriented. You change, you turn the smaller screws. It's not like building a big machine, you just we're now more in an optimization mode.
Ariel Camus:Going from such a crowded, fragmented market to three, and you and Kultra being one of the few ones you know standing. What was the thing that allow you, or the things that allow you, to be among the few ones that are still here today helping with the consolidation of the industry?
Timo Buetefisch:Yeah, no, it's definitely the people I mean mean it sounds so strange, but it is what it is. We had ample experience. So when we entered that market, we were already 10 years doing this thing, so we had really extensive experience in managing fleets, in working as a team. Other people went in and they built, like, in very, very short timeframe, everything from scratch. No, we were building it over a long period of time now and, yeah, I think, being very much involved and very caring about details and making it work and also aligning the different levels of the company no, employees, management, team shareholders in this same vision helped a lot. I think, luckily or not, or call it also working well as a team was very, very important. We had access to capital, that's true, but many others had as well, so that was not the differentiator.
Timo Buetefisch:Also, at one moment, we took a very important decision to in-house technology. So when we started off, we basically outsourced technology. We used SaaS right, and that was great because it helped us to go very quickly time to market. But now in the consolidation game and differentiation game to competitors, it's very important to own the technology roadmap. So that was a key change in our strategy. Six years ago we had maybe three developers. Now we have a team of 40. So we invested heavily in our own technology.
Ariel Camus:That makes a lot of sense. What is an example of something that maybe a new player and of course, we don't really know everything going on inside other companies, but what is something that you know happened? Maybe that a competitor did with less experience, even if they had the same or more cash. That, from your perspective, was a mistake that you were able to avoid because of your experience of many years.
Timo Buetefisch:Yeah, no selection of assets. For example, the product no. So if you look at players, what kind of mopeds they're using? No, it reflects sometimes that they have no too little experience in terms of sourcing no, that is an example. Then, for example, reliability of service no, because our service is quite complex. No, you have to register via an app, leave your driver's license, load up your credit card and then find the moped started, get the helmets out of the box, take pictures at the end no, and all these things are happening at the same time, so you can't't fail on any of these components of the mixture between the hardware, the software, the customer service. So I think we found a good balance in managing all the different variables, and that's not evident, I would say not so easy, and that's something that Kultra does. I would say we give very reliable service, we have good customer attention service, and that helps definitely to survive.
Ariel Camus:And I imagine having to deliver a product that depends on hardware, like a moped. It means things are much more capital intensive, so mistakes are also more expensive. Was there any mistake in the early days, where the cost was high but also the lessons learned were also important for the future?
Timo Buetefisch:Yeah, many times. Sometimes we invested in hardware. It's exactly that case, ariel. As you say, you buy a huge fleet of I don't know 1,000 units. You see it after a few months and then you're stuck with this vehicle for many years. You can't get rid of it. These are mistakes we committed during the early years. Nevertheless, now we are very highly integrated with the manufacturers. We do a lot of testing, and so now when we launch new products on the hardware side, it's much more tested. No, but it's a big issue. No, and it's exactly that. If you ask me, one of the reasons why CityScooter that was our main competitor in Paris went into bankruptcy and stalled and didn't continue was definitely their asset, the selection of the hardware, which I don't think was satisfactory. But companies or competitors have failed for many, many other reasons.
Ariel Camus:I can't imagine in in which ways, for example, customer service for something where you are relying on a vehicle to take you from point a to point b, yeah, can create a lot of dissatisfaction if it doesn't work well or if you're not responsive enough, and customer opinion, especially in the market with alternative options, uh, that can, that can definitely kill a business. So, yeah, how, in which ways have? This is way less about the company, it's more about you. Like, in which ways have you changed or have how Kultra have has changed who you are as a person because of all this journey for 18 years?
Timo Buetefisch:now I've grown a lot. No, when I, when I founded the company, I was 32, now I'm 50, so it's a whole. It has happened many, many things. I would say I was prepared to lead the company at the beginning. You do a complete learning process, especially through managing people, managing situations every day. By looking what you've done, right or wrong, reflecting, doing feedback loops. You get basically better prepared for difficult situations. The thing is, the bigger the organization and the higher you are, it's also the more complex situation you're confronted with. Right, I would say, in terms of I have very, very good managers, so most of the decisions are managed by my team. Right, so on my test, mainly learn things that are very complex. No, so it's also quite challenging always, because sometimes I would love to handle also sometimes situations. But it's a little bit like the great privilege, but also a little bit the challenge for a CEO, because normally you are confronted with things that are quite complex in nature, which is mainly related to people.
Ariel Camus:People is always the hardest part.
Timo Buetefisch:But yeah, we're doing a good job. I think we're really transparent. We say things as they are and if we identify issues, we try to put them on the table. So I think we have quite a good culture in that sense.
Ariel Camus:For someone who is starting the journey? Yeah, do you think that it's about like you need to have already this innate ability to learn fast and adapt, or is there any technique, any tool, any system that you have used to help you learn and grow as fast as needed for the company?
Timo Buetefisch:No, first of all, I think there's no one that is more qualified or less from this, Because I've seen so successful entrepreneurs with very different profiles, personality traits and characteristics. They're more introverts or more analytics, more marketers, more visionaries, more executors. So I have. The thing is it's always great no to what you're not good at to find complementary people. No, so basically, what you try is to complement and compensate the things that you are not so great at. No, so that is something you learn. Compensate the things that you are not so great at. So that is something you learn on the way.
Timo Buetefisch:So you try to get people that are compensating you, because if you are not so good, maybe with excellent numbers, it's great to have somebody in the team that does it and is very supportive. If anybody is more, let's say, creative or less creative, then it's great to have the counterpart. You know and um, so that that is something that helps tremendously. You know, because you, you realize you know, if there's a size of like 50 people, a company, 50 or more or even less, you know, then it's just impossible to do it all yourself. So you need the good people around you and listen and keep your eyes open and try to be flexible.
Timo Buetefisch:I would say the older you get, the less flexible you are. So that's why I think starting business between 25 and 35 is great, because also your opportunity costs are lower, so you're not so worried about what happens if you fail. So there's never a perfect age, obviously, but I think being younger, a little bit more foolish, a little bit more risk-seeking is really great, because with the time you get more and more you learn from experiences and you get a little bit maybe more conservative. No, yeah, it's just how things develop.
Ariel Camus:What I'm hearing is that anyone can do it and can be successful. Obviously, you haven't said this, but probably you will agree that there is a big component of timing that can play a huge role and lack whatever you want to call it, but that, at the end of the day, it's about experience. It's about doing it and doing it while learning. What are you good at, what are you bad at Delegating, what you're not good at you good at, what are you bad at delegating when you're not good at? And the younger you are, the more likely is that you will have the environment where you can make tons of those mistakes at a low cost for your life overall, which gives you this place to fail, fail, fail, learn, learn, learn, so that the older you get, the more experiences you have to become the best you know, perfect person for the business and what is also great.
Timo Buetefisch:Just one comment on this is it's like, from a life perspective, no, I would say big learning is, and never put all like all the focus only on the business. You know it's like very important. Besides the business, always, no also construct other elements like keep your body strong, eat healthy, sleep enough, build solid relationships with friends or partners, do sports, because you have to see it that way, there's a huge risk of getting so obsessed by business I've personally done it and I see it and the problem is then then imagine then it fails, then you have nothing to know, other pillars, but I mean, it seems so obvious, but it's definitely an error which I committed, because you think like you have to give everything to make this work, which is great also, but it's also dangerous.
Ariel Camus:What was the moment where that happened to you and how did you realize that that was not a sustainable path?
Timo Buetefisch:I went through a divorce, for example, because I didn't the heavy price I paid on that. That was in the early days. It's never the only reason, no, for separation, but definitely I was working like hell, you know, so it wasn't easy, no, so that was a very, very hard experience for me was, but yeah things happen for a reason and then you compensate and you meet a new partner.
Timo Buetefisch:So life goes on. No, but it definitely was a learning. It was just. I mean, it happens in different ways. Maybe other people then don't care about their health, which is even worse, you know, because they work so much and drink only coffee, you know, and don't sleep. I know how it is, because you get so obsessed by this idea and it's so important to keep these other pillars alive.
Ariel Camus:Yeah, and if things don't go so well, you have a lot of work to do and more chances of if you don't have other pillars, then not having anything left. But if things go really well, you also have a lot of reasons to do a lot of work. So there's only reasons to do more work, and always unlimited work. You have to put the limits. In your case, was the divorce on its own one of these wake-up moments of something had to change on your side?
Timo Buetefisch:Yes, the thing is also, with the time I'm now 18 years things don't get better in terms of how much the business requires from you. I mean, the's really, really difficult, the challenges are different, but the stress doesn't leave. So, because sometimes I feel people think OK, we start a business, you know, and then, for example, after closing the first financing round, things are done. No, it's when it all starts, you know, and that's just another learning. No, it is a fucking marathon. So it is really hard. No, you have to train hard and it's a long-term race every time. No, it's also good to realize, because success will never happen. It happens sometimes. Some people build an amazing business and then after two years they sell. But let me tell you that is like 1% of the startup world. Most of the cases are long-term gains, and that is assuming that selling is your definition of success right.
Ariel Camus:Exactly I can imagine yeah, not necessarily something that will contribute to your happiness, even though everyone would love to sell you know, a company after two years for millions, but it might not necessarily make you happy. And I love something you said. I think it's such a practical insight and it is to remind yourself that most likely the amount of work and stress will only go up. So if you're trying to justify how you're living your life right now for the business because you think it's just a momentary thing, it will only get worse, so you better put limits right now. How, how are you able to change that? Because it sounds easier, you know, said than done, and I can imagine how you know a divorce and a wake-up moment like that can force us to say something has to change. But how were you able to change completely the way you were approaching this balance?
Timo Buetefisch:It's very good to have peers. My learning and my coaching over these years has been done a lot by other entrepreneurs. I'm in a forum and you know, like this, like this forum format and with 10 other entrepreneurs, and we have been meeting since 15 years, every every month. So we are sharing experiences. It's like a it's you know, it's a little bit like a how do you say it Anonymous alcoholics. It's like a little bit as entrepreneurs that we have been for the last 15 years sharing experiences. So that has been, it has been a peer group.
Timo Buetefisch:I highly recommend peer learning because sometimes the true pains and challenges that you live as an entrepreneur few people can understand. It's very hard to explain to your mother, very hard to explain to your life partner or also people that have corporate jobs, because it's just not comparable, right. So peer learning is very powerful. So there are many ways of doing this. No Like meeting for lunch with other entrepreneurs, listening to podcasts, going to entrepreneurs events and building this community, because I felt it's very powerful, the sharing with other people that go a similar way. So that has helped me a lot.
Ariel Camus:Reflect honestly that's so amazing, it's such an important piece of advice and I would say especially, it really doesn't matter the size but, I think, the quality of those connections and for it to be a place where you can actually be vulnerable, where you don't need to show what probably you need to show every day at work, which is that you are the rock.
Ariel Camus:You know that you will never have doubts about things like that is a very dangerous path If you have to play the role every single day, every single moment. So having people that that can share those the joys too, but also the sorrows, in a vulnerable way seems like such an important way to get balance. And coming from someone that has been doing this for so long, I'm pretty sure it's it's.
Timo Buetefisch:You know it's signed, that it actually works yeah, I mean, let me give here like three practical devices. There are three groups that I like that work in this system. One is the Entrepreneurs' Organization. It's called EO. It's an American institution that have different chapters and they do this forum learning. There's another one, it's called Vistage, works the same way and there is a no Bull bullshit network here in barcelona. So all these are based they're kind of similar um in the idea of sharing between other entrepreneurs. But it is, it is. It's quite uh cool huh. So any of these three maybe could be of interest to other. Thank you, you.
Ariel Camus:Thank you for sharing that. I'll make sure to put this in the notes of the episode. And also a big shout out to Jorge, who is running no Bullshit. I think he's doing an amazing job at precisely creating this type of tight-knit, high-quality vulnerable communities. It's not easy to do it and he's clearly doing a good job there. How have you balanced vulnerable communities? It's not easy to do it and she's clearly doing a good job there. How have you balanced this need to take care of yourself, your team, the business, the shareholders, but also balance that with the pressures, the needs, the incentives of the venture capital side of things? It's amazing that you have achieved the size you have today and you have achieved, you know, this like solid EBITDA. You know profitable company. What did that look like? You know the journey in your relationship with your venture capitalists.
Timo Buetefisch:Yeah, no, very good question. Also, I think the first learning is here for different phases of the business. You need different how do you say it? Compañeros de viaje, no, People that share the trip with you, no. So I think it's great at the beginning to have really more this informal investors, business angels, friends and family. You know you need quickly take money. You probably don't have in place a strong financial reporting etc.
Timo Buetefisch:No, then there comes a phase where you start contacting like seed uh, seed funds. You know that put 50k, 100k. They do also what they. They don't get very involved in the business. They spread money, they invest in 200 companies, take 100K, hopefully it works. They play lottery. So that's the kind of investor that will get very low minority etc. And then you move up the ladder and people. Then you get into VC. People do tickets of 5 million, 10 million. I have now two family offices as shareholders that put more than 50 million in the company. So this means they have big tickets, they get involved. So they are there for the long run. They want to support you, but they also want to have a say in the business, right, Because with these amounts of money they don't give it away without taking control. So, yeah, that is it. It was just I wanted to make that intro because sometimes people don't have clear which kind of investors you need at which stage. It really depends a lot on the stage of your Now, with these family offices that we have in the company, it's really these people.
Timo Buetefisch:They take an active role in the way on the board level, not on the management level. They understand clearly there's a difference between investors and management Very important. So there's some decisions which have to be taken on board level strategic budget financing, new constitutions, new countries right, these are the strategic levels that happen on board. And then there are day-to-day task management, running the business, which is management. So, yeah, there are all kinds of tools that regulate that. No, so we have quarterly board meetings, we have quarterly reports, we have monthly update calls. So we have like a rhythm established which we defined as like the rules of working together.
Timo Buetefisch:No, yeah, and that works pretty well. It helps also now in these times to meet at least once a year, you know, in physical presence, where we spend like two days together. It's very important to connect and build trust over the personal meetings. But otherwise, we established some rules of working together. They delegate very much to me, but I feel still especially I personally feel a lot of responsibility because at the end I manage their money. So it's not easy, but in general, the more experienced investors are, the more cool they are also facing difficult situations because they have seen it. They know that many things will happen and things go wrong, so that is also great to have people on board Now in family office. Many times they're real entrepreneurs. You know that, have been running businesses and now they are taking money to invest in other entrepreneurs, so it's a really cool investor type.
Ariel Camus:Highly recommendable. Have you had any moment or any partner where, like they were, for example, pushing for growth and you were saying I think it's a moment to focus on profitability, for example?
Timo Buetefisch:yeah, um, it's. It's a little bit the other way around. In our case, it was more like us wanting to grow a little bit more and then there was more like the like, the voice or the news on, well, let's say, the position on the board level from investors. Hey, no, I mean because right now, the last three, four years, we all know it has been really uncertain, I mean, if I compare to before covid, and in uncertain environments sometimes it's better not to spend, you know, and managing the risk. No, and this is a little bit how we grow. Also, now we're probably not so hyper growth oriented anymore. No, we want solid growth, 20, 30 percent per year, going in a solid uh space, no pace. So it has been more like, also, investors, really, really, um, making sure we're self-sustainable, you know, like in case another crisis hits no, which we hope happens.
Ariel Camus:Winding the wheel sooner or later.
Timo Buetefisch:Hopefully not no, but then we are still there, you know, and survive. We survived COVID, we survived the Ukraine crisis and now high inflation. So, yeah, it hasn't been easy and in these times sometimes it's better to be a little bit more reluctant on growth and a little bit more risk averse. I mean, cash is king. If you have now access to money and have an EBITDA positive company, you're in a very, very positive situation, so don't put that at risk necessarily.
Ariel Camus:Absolutely. Do you think that the fact that you chose to work with family offices that invest their own money had anything to do with this more baby balance approach and not just focus on growth than if you had gone with an institutional VC? Yes, yes because was that an?
Timo Buetefisch:intentional decision. No, you know, it's like sometimes you don't know why things happen, but now and looking back, I think it was very positive. No, there's a huge difference. No, in the VC game, compared to a family is exactly like to say normally these are other people that manage the money. You know, it's more like a principal and agent thing. Right? So the vc managers are more agents and they are not necessarily there for the long run because they change positions often. No, so sometimes you have different board members, no, with less experience. No and um. And it's also the investment strategy.
Timo Buetefisch:A VC fund definitely wants to exit after five or seven years. This is the way to make money for them. They want to exit. A family office can be more opportunistic. They can say, hey, we want to be there in the long run. We want to be more opportunistic. Dividend play Maybe we do an IPO, maybe we do an exit, maybe we sell to a strategic player, maybe we sell to a PE. So there are more options. So it's a more open play and VCs take more risk. I would say so if you look at the risk profile, because a VC normally has more investments than a family office. So they could more. They want more return, so they need to take more risk. So that takes the founders. No, for us founders a different game, because it's our own and and only asset, right. So maybe we see, sometimes take you on a ride. That is not necessarily the right for you, but yeah, it's obvious but sometimes it's good to share the obvious.
Ariel Camus:I don't think it's obvious for someone who is starting and is taking venture capital and might not be aware of this which there is nothing wrong with this right, like it's just understanding the incentives and deciding if they're aligned or not.
Ariel Camus:And if they're not, well, just know that that might create certain you know conflicts that you will have to overcome and that that, as long as that's a choice and not something we do, you know, without intending it, I think that that's fine. It's a pattern that I've seen lately in many conversations. The the family office route, I think it's a less common or less known one, but assuming you find what you said a family office that actually has experience, that is aligned, that understands the division between management and governance of the board, I do think that can be a great way, because they're investing their own money, which resembles a little bit more your incentives as a founder, because you're managing just your one company, which is probably where most of your net worth is concentrated. So it's a better alignment of incentives, I guess.
Timo Buetefisch:Well.
Ariel Camus:Timo, it's been a pleasure. Thank you so much for sharing. I think it's been a relatively short amount of time, but packed with so many insights and tips and advice. I look forward to sharing the journey with you in the upcoming years. I look forward to maybe doing another one and seeing where things are. But, thank you for everything you've done today.
Timo Buetefisch:No, thank you Ariel. You can see your experience and very empathetic interviewer, so congratulations also. Thanks a lot, I've been a pleasure and I'm also available for the listeners of this podcast. If you want to contact me, find me on LinkedIn Timo Kultra. I'm always there to help other entrepreneurs.
Ariel Camus:That's awesome. Thank you so much for doing that and I'm sure I will connect with you as a peer at some point to get some advice and support, because we all need it, thank you. Thank you, artimo, great having you. Thank you so much for tuning in. Your support means the world to me. If you enjoyed today's episode, please consider subscribing and leaving a review. It's one of the best ways you can help this podcast get off the ground and help more entrepreneurs like you. Thank you and until the next episode, thank you.
