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2017 - 10:55
With a doctorate in physics, Guillem Sagué is part of the Nauta Capital team in Barcelona. After working in one of the most important investment groups in Germany, High-Tech Gründerfonds, he now analyses the best opportunities for investment in Catalonia for one of the few venture capital funds established in our country. "Nauta looks for companies that are potentially disruptive in large industries in which technology has had a modest presence until now," he says during one of Acció's Esmorzars de Finançament, where he presented the main metrics he uses in his analysis. In short, he makes it clear that in venture capital "you cannot optimise the return for investors if you do not also optimise that of the entrepreneurs. Both parties have to make a lot of money."
What is a normal day for an Investment Manager in Nauta like?
The basic part of my day is what we are obsessed with at Nauta, which is optimising the return for our investors and founders. That means 90% of my time is spent in analysing investment opportunities. It is what I like best and what I spend most time on. Whenever we find an investment opportunity that fits our search parameters, we concentrate100% on analysing this option and we do not do anything else in the next two or three months until we invest. After that, the cycle begins again.
How many opportunities might you analyse over a year?
Nauta is split into three geographical areas and each one analyses some 200 qualified opportunities. If we include the unqualified ones or companies we meet in different meetings or events, no doubt we reach 400 for each area.
That is a lot compared with the number of investments you end up making...
The percentage is very low; we are very selective. We are in terms of the demands we make on companies, but also in terms of the type of sector and stage we invest in. That also means that we rule out a lot of opportunities due to the structural issues of companies.
In fact, most of Nauta's investments have gone to companies with a SaaS business model. What does this model have that makes you put it before others?
It is not that we tend towards only SaaS companies. What we look for are companies that are efficient in the use of capital. We analyse the different business models with their metrics; and it is true that most companies that we end up liking are in the SaaS sector. This is basically due to these companies' efficiency in the use of capital. However, over time we have also invested in companies that are not SaaS and that have worked out well for us, such as Privalia or Social Point. Therefore, it would be false to say that we only do SaaS companies, but that is the result of our research.
What does being efficient in the use of capital entail?
There are two parts. What the public in general considers, which is being careful when it comes to spending money and promoting the company, and not paying oneself too large a salary as a founder. But we think that this is not enough. The founders have to go further and look at the efficiency of growth. In other words, establish and understand where the company's growth is the most efficient. For each euro invested in growth, the turnover has to grow as much as possible. And that is basically to be found in the metrics. Our advice to entrepreneurs is, apart from being cautious, that they look at where their growth is the most efficient.
Is a company's projection only evaluated with metrics or do you also include other parameters?
The metrics are the dimension we look at the most. We also look at the quality of the entrepreneurs, at the value proposition, if it is tangible or if the clients give feedback on whether they truly need the tool. And, clearly, we focus on the size of the market. It has to be a large market in which the industry is global and has still not experienced a major penetration of technology.
What makes you rule out an investment straight away?
Apart from structural reasons, that it is not in a sector we are interested in or because they are more or less at a stage that is more mature than we invest in; one of the factors that leads us to rule of most companies is the efficiency in the use of capital. When we look at a company and we believe that it will be too intensive in capital to make the business model grow, we feel less attracted to the business model.
Do the entrepreneurs that present projects to you come well prepared?
They are increasingly better prepared. There has been a significant improvement in the past few years. There is increasingly more information on the net, more talks that people can listen to before going to visit an investor. That means that they are increasingly more prepared.
Nauta has a presence in Barcelona, London and Boston. What differences do you see between the three ecosystems?
In terms of the entrepreneurs they are very similar. There are high quality entrepreneurs in all three places. The big difference is the ecosystem around them. In London there is a much more active ecosystem in terms of the capacity of investors to invest, something that changes Nauta London's investment conditions. In Boston there is also a little more investment than in Barcelona, even though it is true that this is changing. We use the same standards in all three places, with the same investment thesis.
Recently there was a ranking that put Barcelona as the European city with the best return for venture capital investors. Do you share this optimistic view?
We believe that the ecosystem is improving, even though sometimes you need to be really wary of the statistics. This statistic in particular did not refer to the return for the investors, but rather the difference between the company sale value and the capital invested, which is not always the same thing. Having said that, I think it is a good sign and it reflects the reality of Barcelona as a future investment hub.
However, in Catalonia there are not so many options for venture capital. Why is that?
That is changing, we are seeing a lot of funds appearing this year. Before, I don't really know why there were so few options. It could have been due to the lack of capital in general, that there was not enough capital available to invest. Nevertheless, the opportunities were there and it has always been an attractive area to invest in. There is no doubt that today the capital is available and is closing the funding hole that existed in the past. But I am optimistic and I believe that in the future there will not only be enough venture capital funds in Barcelona, but that there could even be too many.
However, some companies insist that venture capital is too monoproduct...
Venture capital is not good for all companies. Or rather not all companies should seek venture capital. Companies offering services or multiproducts are not so compatible with venture capital, but there are other funding instruments: banks, business angels, other companies that invest... It is not a problem.
What is a normal day for an Investment Manager in Nauta like?
The basic part of my day is what we are obsessed with at Nauta, which is optimising the return for our investors and founders. That means 90% of my time is spent in analysing investment opportunities. It is what I like best and what I spend most time on. Whenever we find an investment opportunity that fits our search parameters, we concentrate100% on analysing this option and we do not do anything else in the next two or three months until we invest. After that, the cycle begins again.
How many opportunities might you analyse over a year?
Nauta is split into three geographical areas and each one analyses some 200 qualified opportunities. If we include the unqualified ones or companies we meet in different meetings or events, no doubt we reach 400 for each area.
That is a lot compared with the number of investments you end up making...
The percentage is very low; we are very selective. We are in terms of the demands we make on companies, but also in terms of the type of sector and stage we invest in. That also means that we rule out a lot of opportunities due to the structural issues of companies.
 |
| Photo: Àngel Bravo |
In fact, most of Nauta's investments have gone to companies with a SaaS business model. What does this model have that makes you put it before others?
It is not that we tend towards only SaaS companies. What we look for are companies that are efficient in the use of capital. We analyse the different business models with their metrics; and it is true that most companies that we end up liking are in the SaaS sector. This is basically due to these companies' efficiency in the use of capital. However, over time we have also invested in companies that are not SaaS and that have worked out well for us, such as Privalia or Social Point. Therefore, it would be false to say that we only do SaaS companies, but that is the result of our research.
What does being efficient in the use of capital entail?
There are two parts. What the public in general considers, which is being careful when it comes to spending money and promoting the company, and not paying oneself too large a salary as a founder. But we think that this is not enough. The founders have to go further and look at the efficiency of growth. In other words, establish and understand where the company's growth is the most efficient. For each euro invested in growth, the turnover has to grow as much as possible. And that is basically to be found in the metrics. Our advice to entrepreneurs is, apart from being cautious, that they look at where their growth is the most efficient.
Is a company's projection only evaluated with metrics or do you also include other parameters?
The metrics are the dimension we look at the most. We also look at the quality of the entrepreneurs, at the value proposition, if it is tangible or if the clients give feedback on whether they truly need the tool. And, clearly, we focus on the size of the market. It has to be a large market in which the industry is global and has still not experienced a major penetration of technology.
What makes you rule out an investment straight away?
Apart from structural reasons, that it is not in a sector we are interested in or because they are more or less at a stage that is more mature than we invest in; one of the factors that leads us to rule of most companies is the efficiency in the use of capital. When we look at a company and we believe that it will be too intensive in capital to make the business model grow, we feel less attracted to the business model.
 |
| Photo: Àngel Bravo |
Do the entrepreneurs that present projects to you come well prepared?
They are increasingly better prepared. There has been a significant improvement in the past few years. There is increasingly more information on the net, more talks that people can listen to before going to visit an investor. That means that they are increasingly more prepared.
Nauta has a presence in Barcelona, London and Boston. What differences do you see between the three ecosystems?
In terms of the entrepreneurs they are very similar. There are high quality entrepreneurs in all three places. The big difference is the ecosystem around them. In London there is a much more active ecosystem in terms of the capacity of investors to invest, something that changes Nauta London's investment conditions. In Boston there is also a little more investment than in Barcelona, even though it is true that this is changing. We use the same standards in all three places, with the same investment thesis.
Recently there was a ranking that put Barcelona as the European city with the best return for venture capital investors. Do you share this optimistic view?
We believe that the ecosystem is improving, even though sometimes you need to be really wary of the statistics. This statistic in particular did not refer to the return for the investors, but rather the difference between the company sale value and the capital invested, which is not always the same thing. Having said that, I think it is a good sign and it reflects the reality of Barcelona as a future investment hub.
However, in Catalonia there are not so many options for venture capital. Why is that?
That is changing, we are seeing a lot of funds appearing this year. Before, I don't really know why there were so few options. It could have been due to the lack of capital in general, that there was not enough capital available to invest. Nevertheless, the opportunities were there and it has always been an attractive area to invest in. There is no doubt that today the capital is available and is closing the funding hole that existed in the past. But I am optimistic and I believe that in the future there will not only be enough venture capital funds in Barcelona, but that there could even be too many.
However, some companies insist that venture capital is too monoproduct...
Venture capital is not good for all companies. Or rather not all companies should seek venture capital. Companies offering services or multiproducts are not so compatible with venture capital, but there are other funding instruments: banks, business angels, other companies that invest... It is not a problem.
 |
| Photo: Àngel Bravo |