Jon Fatelevich: “I think that the Securities Tokens, when the legal framework is available, will be an untapped market”

Jon Fatelevich

Jon Fatelevich is a former professional basketball player (1996-1999) and is currently the CEO and Co-Founder of StadioPlus, a company dedicated to selling NFTs (non-fungible tokens) related to the world of sports for collectors or investors. In addition, he has invested in more than 80 startups such as PlayJoy, Armada Aeronautics or LingoKids.

Question: As an introduction, what would you highlight the most from your profile as an investor?

Answer: Common sense. If they tell me something I try to analyze it and see if it makes sense.

Q: Have you had any experience in the field of university incubation?

A: I had a company in which we had a small incubator and we were looking for projects that interested us and that would serve to create synergies with our company. Most of the projects were led by people who were in universities.

Q: To a person who has just graduated from university, what advice would he give before setting up a startup?

A: Set it up. My advice is to mount it and try it out, and if you make a mistake, nothing happens. The only way for me to learn is by trying and failing and getting back up and trying again. Don't think about it too much.

Q: Seeing that it is becoming increasingly difficult to find a job in Spain, especially for young people, do you think it is a mistake to start a business out of necessity?

A: No, I think entrepreneurship is a success. You have to start. Not to undertake is to think that you are going to fail before trying, so I think that people have to undertake. Entrepreneurship does not mean being the founder of a startup many times, it can be entrepreneurship and create your own physical store, entrepreneurship and dedicate yourself to advising other people, create a blog, a post, a newsletter... Anything can be entrepreneurship. People understand how to undertake that you have to have a technology startup that is the future Google, but it doesn't have to be that way.

Q: Before investing in a startup, do you do any prior validation? Do you have some kind of “checklist” to assess whether an idea is worth it?

A: Of course, yes. I like to see who the team is, talk to them, see if they have experience or if they don't. If they do not have experience, I can also invest if I see that they have knowledge, drive, desire and that they know what they are talking about. I try to invest in projects in which I have some knowledge, such as the world of sports, the blockchain world or the world of fintech investment.

I also look for the market to have potential, for it not to be a tiny market because, in the end, when I invest, I try to make sure they are investments in which the multiple is large if it works out. I'm not so much looking for the security of making a small multiple, but rather the possibility of making a large multiple. If I want small multiples, I invest in other things, or I invest in companies that are already listed, or in some cryptos that are already more or less established, such as Bitcoin or Ethereum... If I invest in a startup, in general, I assume a higher risk great.

Q: Have you had any experience in the field of startups arising from professional training? Do you think it is a suitable space for the creation of startups?

A: I know many startups that have people who came out of the VT. Startups that have come out of kids who have done ESO or Bachiller and who did not go to university. Yes, there are many cases. I don't usually measure startups by the title their founders have, although sometimes it is important for certain projects because of networking and market knowledge. If I am going to invest in a stage of deep tech and the founder studied at MIT, then yes, it is important, but for me it is not the priority.

Q: What do you think about international mixed teams of entrepreneurs? Do you think they are viable? Do you have any experience about it?

A: Yes, totally. I believe a lot in mixed teams and remote teams. In the startups that I have founded, and in some that I currently lead, we have mixed and remote teams. People in Latin America, in Europe, in the United States and even in Asia. It seems to me that remote work is here to stay. There are many people who prefer to work remotely, I personally prefer it. We get together with people from outside every two or three months and do an event, something Team Building.

Q: What experience have you had with startups in Latin America, or with Spanish startups in Latin American markets?

A: I am Argentine, I have lived in Spain for 14 years, but I am a partner, or investor, or advisor to many startups in Latin America. In addition, I help some Spanish startups that want to understand a little about the Latin American market and startups from Latin America that want to come to southern Europe. There is a lot of talent, the costs are lower, the market is strong, the funds want to invest in Latin American startups or in Spanish startups that attack the Latin American market... In my case, I have some startups in which our target audience is the user of Latin America.

Q: Have you ever had experience with startups in the Canary Islands?

A: Yes, I have been to the Canary Islands several times with the people from Draper VC, who have agreements with accelerators and Venture Capital from the Canary Islands. In addition, we are also evaluating moving some of our Spanish startups to the Canary Islands for the tax and economic benefits. It is a place where many people would like to go to live because of the climate, and this helps us to attract talent. I have invested in startups from the Canary Islands and I think there is a lot of talent and that it is a very good gateway to Africa and Latin America.

Q: What potential do you see in a region like the Canary Islands and an island like La Palma?

A: In the case of La Palma, it is a complicated question. I think it will need more help than the rest of the islands. I understand that there will have to be more public aid than normal to encourage startups to go to La Palma and help its economic fabric.

Regarding the Canary Islands itself, I think that not many people know about the tax benefits that exist. We have been studying them for quite some time and we are already quite advanced with doing some things there. I think there is a lot of potential and that the next few years should be very good for the Canaries. The ball is being spread that it is a good place to undertake, it is a good place to have those benefits and, as we said, the climate and the location for business with North Africa and Latin America are also very good.

Q: Do you think there is a trend to invest in more and more early stage startups? How do you personally position yourself before these phases?

A: I think people who are just starting out prefer to invest in more early stages because the tickets are smaller, but they don't know all the risks of investing in early stages. In my case, I have a mix of initial phases and more important rounds. In the end, if you invest in a startup that is already more developed, that is doing a series A or a series B, then surely it already has a long way to go and a few years of advantage against a pre-seed or a seed.

I think you have to have a mix. In my case, I make some investments in pre-seed or seed rounds because I think I can help them and add value. And when I go to larger rounds, I invest through an investment vehicle in which I go with more people, or through a Venture Capital such as the people at Draper VC. When you invest in a big round you have to do some due diligence. No one invests millions without doing a due diligence and I don't have the time, or perhaps the knowledge, to do a due diligence on a big startup, so it's better to go hand in hand with a Venture Capital.

Another option that I also like is to enter a more seed-type phase but through a crowdfunding platform, in which you can join other investors and put smaller tickets. In the end, there are options for all tastes.

Q: What should a startup have achieved before starting to seek investment in an ideation or pre-SEED phase?

A: Where possible, product market fit. Have a product, have made an MBP (minimum viable product), have validated who your target audience is and validate that they are interested in buying that product or service. In principle, this is enough for a pre-seed phase. In a seed phase, I prefer that it is billing and that it is growing, at 20% per month for example, and that it has a team of people who work full time on that project and who are involved.

Q: What experiences or perspectives do you have on the tokenization of startups as a means of financing?

A: There are two types of tokens, Utilities Tokens and Securities Tokens. The Tokens Utilities is when those tokens that you are selling will later be used to carry out certain actions within the platforms. In other words, they are utility tokens. He bought me tokens to gain access to the platform, to have discounts, so that later with those tokens he can buy things that they sell within the platform… That is a way of financing a startup, financing by making a utility token, that token then have a utility within its ecosystem. I see it well, if the usefulness of the token makes sense, and if it has already been validated that the platform will work with tokens, since not all of them can. You must use blockchain technology and make sense.

Regarding the Securities Tokens, which are directly as if they were shares of the company, the subject is still a little greener. Things are starting to get done. I think it's going to be an interesting market and I think it has a lot of advantages because it's liquid. If they start doing rounds of tokenized securities, which would be to buy shares of the startup with a token, those tokens could have liquidity on day one.

In short, I think that the Securities Tokens, when the legal framework is available, will hit very hard. There will be many startups that are financed in this way, many platforms where you can invest in startups via Token Securities. In the United States, in Miami, there is a Spaniard, Carlos Domingo, who has a company that does exactly this, Tokens Securities. Let's see if we soon have him exporting that model here in Spain, because all his experience and all the technology he is developing will surely be very important.

Q: What advice would you give to a person who wants to start investing in startups in very early stages?

A: Perhaps the first investments should be made in a crowdfunding platform that has already done a due diligence and has filtered the opportunities, such as Startupxplore. That he enters, perhaps, in an association such as BigBan, where there are many Business Angels who already have a bit of experience. Use common sense and let yourself be helped. Many people have a desire to want to find the only one that is a unicorn but that is very difficult. I prefer to be accompanied and to be able to share my opinions with other investors. Two heads are always better than one.


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