#14 Sonia Fernández

Partner at Kibo Ventures, European VC with €220M and recent top traction including 3 unicorns and 1 IPO filing. Ex Country Manager at Match.com ($38B+ valuation) and MercadoLibre ($75B+ valuation)

We are Pol Fañanás and Gerard Garcíatwo friends passionate and curious about tech, startups and VC sharing weekly high-value views from people creating the future. Thanks for reading !


Sonia Fernández is Partner at Kibo Ventures, a European VC with €220M AUM and currently investing out of its Fund III. They have seen incredible traction over the last 12 months, including 3 unicorns and 1 IPO filing. 

Some of their portfolio companies are Flywire (payments fintech currently planning a NASDAQ IPO, $320M+ funding by Goldman Sachs, Temasek, Bain Capital and Spark Capital, among others), TIER (mobility, $388M funding by Northzone and Softbank, among others), Jobandtalent (HR tech, $300M+ funding by Atomico, Blackrock & Softbank, among others) and Devo (cloud-native data analytics and cybersecurity, $131M funding by Insight Partners and Bessemer Venture Partners, among others).

Previously, Sonia had multiple tech operator roles such as Spain Country Manager at Match.com (online dating, IPOed in NASDAQ and valued at $38B+) and Spain Country Manager at MercadoLibre (LATAM e-commerce, IPOed in NASDAQ and valued at $75B+). She also worked in Private Equity at 3i and in M&A at Lehman Brothers.

Sonia is mother of 4 kids, holds an MBA from Stanford and helps in different social impact initiatives such as level20.org, non-profit organization dedicated to improving gender diversity in the European private equity industry so more women of diverse backgrounds achieve relevant senior positions.


Summary


Could you give us a brief intro about you and your origins?

I am from Madrid and my origins are pretty normal. I always tell my kids I was a classic nerd growing up, always studying and enjoying it too (I know…).

My parents were totally self-made, no university nor any type of relevant education and they started working really early in life. This played a major role in their obsession to provide the best possible education for their kids, they were convinced excellent education would open any doors. My father was a risk-taker and he believed in toughening up through experience. He believed it would be a good idea to send my siblings and myself to the UK for the most part of the summer when we were just 9-10. No mobile phones, lack of info regarding destination, young kids traveling alone … that was pretty crazy but helped me a great deal later in life.

I finished school and went to ICADE university in the 90s. At that moment there was a new international program option based on doing 2 years in Spain and 2 years in the UK, France or Germany, something super innovative for that time. I was one of the few students that got in, I started in Madrid and finished in London and the experience of studying and living away from home was really great.

Then in London in 94, if you could, investment banking was the place to be. I applied to different banks, I got quite a few offers and ended up joining Lehman Brothers. The Spanish team there was great and I spent the first two years in the UK and the third one in New York.

The dynamic back then after being an analyst was to do an MBA in the United States. So before completing my third year, my boyfriend, who was working at Repsol in the UK, and I applied together and we got accepted at University of Virginia Darden School of Business. It was not our top option and then my boyfriend got an opportunity in Madrid with Repsol so I stayed a bit more in New York with Lehman instead of jumping straight into the MBA. Then after completing my third year, I re-applied and this time I got quite a few offers including Stanford. I had the chance to visit the campus in one of these events for admitted students and Stanford totally blew my mind. Even still today I keep great friends that I met that first day, a year before starting the program!

From NY to San Francisco, graduated in 99, Silicon Valley was definitely the place to be. Stanford was an eye-opener to tech and to opportunities. Impossible was literally nothing. In those days you could write a business plan, find people to join your company and money to get started. Prior experience did not seem to be much of an issue. Who was an Internet expert back then? Almost no one, but people from my class, literally on the first year at Stanford, founded companies and then did not come back. Very many students became entrepreneurs during the first and second years of the MBA, much more than nowadays. Today you can join Google or Facebook, back then you could start Google or Facebook, the sky was the limit.

Eventually, I decided to go back to Madrid, my boyfriend and I wanted to marry and he was in Spain. I applied to 3i, a private equity firm that was starting doing Internet deals at that moment, I received an offer and accepted. But after 3 months some of my classmates that went on to build MercadoLibre told me that they were planning to open Spain and asked me if I knew of someone who could lead it. And I was like “What? Someone? What about me?”. So I left 3i. To this day I still remember the reaction at 3i when I said I was leaving to start an auction service. Disbelieve and a sense of “what is she thinking”. I still have great friends at 3i and, luckily, I never regretted leaving to start my career in tech.

At the end of 2002, eBay bought a stake in MercadoLibre, an exchange of assets was performed and as part of that deal, the decision was made to close MercadoLibre operations in Spain since eBay was already active in Europe and competing made no sense. We managed to also sell MercadoLibre assets in Spain and I left, in the middle of a complex post tech bubble period.

I ended up working at Prisacom in the strategy team. I worked with two incredibly bright ex-McKinsey women and we faced quite a few challenging times for the media group. I spent a little bit over a year there and the cultural shock was brutal. The strategy team was in a little bubble but the culture of the group was just not for me, too much red tape and not too much action.

At that time, a friend from Stanford who had built and sold a startup read some info that Match.com was expanding into Europe. He got contacted to open the French office and was told that there was interest in opening Spain and LATAM. I jumped right in, a seemingly unconventional choice (online dating was not what it is today way back in 2003). I spent 6.5+ years at Match and I truly enjoyed it, phenomenal experience, we tried and tested very many things, lots of freedom to do stuff especially in marketing and sales, not so much in product. Great managers, great culture of working hard and playing hard, very number-driven but paying attention to creativity and fighting important battles. I wore the Match shirt with pride and finally left as Meetic acquired our assets in Europe.

Right after the sale, my boss at Match connected me with Specific Media, a US digital advertising company who had redefined behavioural targeting. Great self-made founders with a go getter mentality. I spent a few years with them as European market lead for their video business. Until everything stopped. My mother got really sick and she came to live with us. Her condition required a lot of time with doctors and appointments so I decided to stop a little bit professionally speaking, taking some part time consulting projects. After a few years, my mother passed away.

I was then ready to go back full time. This time I was thinking of joining a new mobile advertising project and I asked a friend who really knew the industry. His answer? Wait. He was closing the second fund of the VC he had co-founded and he was thinking about expanding the team. That friend was Aquilino and the VC was Kibo Ventures. I had met Aquilino while I was at MercadoLibre and he was at Submarino, and we kept in touch when I moved on to Match.com. In fact, before joining Kibo I helped in some consulting for one of their portfolio companies. And I also knew Javier, the other founding partner of Kibo, from my time at Lehman around 1994 as we had both started as analysts back then.

So ultimately, I had the opportunity to join Kibo, thought it was just the right fit. I could remain in tech from a different perspective, an operator turned investor, I had started as investor at 3i so in a way I was closing the circle.

And yes, I married my lifetime boyfriend, in case you were wondering, and managed to have 4 kids, still blows my mind to this day.

What would you say has been the biggest win in your life?

If you work you can get anywhere. People say the word impossible a lot, but I do believe that thinking you can achieve something carries a huge weight into actually doing it. Do not be scared. Try new things. We are our own worst enemy, if you say you can’t you will be right.

Stanford is the best example to illustrate this. You are surrounded by people who are doers, they try things, they are not smarter, you know it because you are sitting right next to them in class. You really realize that if they can, you sure can too.

Then, on a personal level and more importantly, my family is my biggest win. My marriage, and my 4 kids. Everything else is secondary to this. And the same holds true on the personal front, believing you can will make you succeed.

Related to the above, and your biggest failure?

A failure or regret is not to have had too much time to enjoy things or not have done too many crazy things along the way. Sometimes you are just so focused on making everything work properly that you forget about enjoying the ride or you simply do not have a lot of time to do so.

It is important to find time for oneself too, I find it very difficult to put myself first, but I am working on it…

What is your ideal founder profile?

I would focus on three main factors:

  1. I love founders who have a crystal-clear idea of how to solve a problem, a relevant problem that affects them, a pain that they have experienced and deeply understand.

  2. Humble and good listeners. The best founders are the ones who listen and who are humble enough to understand that investors can add value. Of course founders will know more about their business but the best ones are the ones who respect others and appreciate feedback. Sometimes very tech founders feel superior since they understand tech at a far superior level, however, these are not necessarily the best founders, being business savvy and being willing to learn is the key to building a great company.

  3. Dreamers. They have to think big and believe they can make it. One needs to be a bit of a dreamer to start a company, this is clearly not for everyone, not for the most practical people, dreamers, founders with passion, the dream, the passion needs to be there.

What is your ideal investor profile?

Again, 3 main characteristics:

  1. I like investors with their own criteria, that have a conviction strong enough to say “yep, this industry looks good but I am not seeing it”, or on the contrary, being able to bet on things other people are not paying attention to. There are lots of followers in the market right now and even though it is true that if some top investors are following specific trends you should probably be paying attention, it is also true that the investors who get the biggest opportunities are the ones that have their own criteria. Big counterintuitive bets are interesting.

  2. Having a special eye to detect and understand top teams, while being able to build up relationships and remaining empathic. Sometimes you can see people that truly do not fit the standard of perfection (e.g. bad story telling or bad English language), but they have some qualities and previous experience that just fits. So being able to detect excellence in teams is fundamental. But unfortunately, that is not enough. You have to make the best teams choose you, connect with them and not have them see you as complete jerk.

  3. Add value, but for real. Understand the real needs they have at any given point in time. The more experience an investor has, the more connections she can make at the right time. Be concrete, be specific, reach out, talk to the founders, ask what they need, make sure they know you are there for them.

What present and future markets are you most interested in?

There are a big number of interesting things out there right now. Everything close to automation (see GPT-3) is fascinating. It amazes me when people say this is just the beginning, super excited to see how this will impact everything from content creation to all-around process automation. Excited to see how AI will make things happen much sooner than we expect and how different industries will continue to be disrupted.

When we invested in Vilynx, I started looking deeper into this area and I realized the importance to match technology with go to market. It is key to see how we can find use cases that provide value, from media, education, industrial processes to content. I am fascinated to see how creative processes will be transformed by AI and how new GAN networks will evolve over time.

Additionally, another market I am super excited about is healthtech. Access to data will help us make smarter decisions on how to make better treatments. Technology will democratize access to mental health options and longevity startups will enable us to focus on improving our quality of life. Technology is giving us more time and more freedom and hopefully the tools to improve our health along the way.

Finally, I would like to mention mobility and the future of cities. With Kibo we have been looking into this space quite a bit. Mobility is changing dramatically and this will change the face of our cities. WFH is only accelerating this trend. Real estate will be impacted as well. Very excited to see how new startups rise to these new challenges.

Could you share with us 3 startups you like and why?

I will talk about Kibo portfolio, home first.

  • TIER. A German mobility company I really love. I have never seen anything like that in terms of all-around excellence, especially when talking about execution to grow reaching brutal scale in an impressive fashion. The team is spectacular, constantly hiring top talent. Also, Lawrence, its CEO is very special, a visionary, a dreamer, a true leader, relentless and incredibly smart. The info we get from the TIER team is top-notch and the pool of investors tremendous. When I see companies with this strong international growth angle it is hard to not think about Spain being a bit behind. It would be tough to do this type of startup from Madrid, I believe we still need more people able to grow a project at that level.

  • Vilynx. Even though it was not an easy internal sale, I bet on them and we invested with Kibo. The company’s vision is spectacular, you should talk with Eli (co-founder & CTO). I remember when they came to see us, I had just started at Kibo and they sold us on their ability to build a self-learning platform based on their access to video data from their deals with some of the largest media groups in the US. A real ride from those early days to their sale to Apple last October. I loved interacting with the team in our frequent and very well-structured board meetings in Barcelona and San Francisco. Seeing how the team was growing and how they were able to recruit the best engineers and deliver on their product and tech roadmaps was a sign that we were on to top AI talent. The vibe of working on state-of-the-art product and having the team so pumped up about their progress was great to see. It is weird because I don’t believe the project was really valued here in Spain, the market vertical maybe was not super venture friendly, especially with tough GTM, difficulty to close contracts and hard monetization. However, JC, Eli, and the team focused on building great tech. Sometimes it is tough for VCs to see under the hood and spend time to understand and DD the technology. Apple did see the value. This is a good example of how we can build great tech in Spain with excellent Spanish engineers. Vilynx has by the way been the first company purchased by Apple in Spain. To more to come…

  • Odilo. I love the way the company defines its product as the Netflix of books. The Odilo platform provides access to the most comprehensive book catalogue on top of other media (audiobooks, podcasts or video) and focuses on making content accessible to any school or library. In particular, they provide a learning platform for schools focusing on reading plans to improve reading skills. Democratizing access to content at schools and helping kids become better readers is a crucial cause and one that its CEO is totally passionate about. Odilo tackles both the private and public sectors and not only in Spain and LATAM but also in Europe and Asia. After raising a B round Odilo is ready to scale and execute on a GTM with a clear focus on improving education through a personalized learning platform. We like the sector, we like the vision, the challenge lies on the execution.

Could you share with us 3 investors you like and why?

Some I have had the opportunity to come across in life and I really liked are:

  • Paul Murphy from Northzone. Really smart and humble person. VC with operator experience in multiple sectors, super human, super responsive and with a great eye to fund fast-growing unicorns (Tier or Hopin) are two examples.  Paul did his MBA at IE in Madrid so we have that natural bond.

  • Nate Jaret from Maniv Mobility. We came across in Bipi, a car subscription startup from our portfolio, where Maniv invested after us, their first investment in Europe by the way. He is specialized in mobility and based in Tel Aviv. I love his interactions at the boards, always adding value, asking great questions, super active, sharp and helping create a good vibe. I appreciate how he brings his perspective from the Israel VC ecosystem and how he absolutely loves to have Spanish tortilla de patatas at every board meeting (I am sure he is not appreciating Zoom boards right now)

  • Steve Anderson from Baseline Ventures. We were classmates at Stanford in 99 and I still remember him as one of the most fun and nice people in the class. Really contrarian guy, he can say anything and defend it wholeheartedly, super curious, always asking and looking forward to building relationships and learning. After the MBA at Stanford he spent time at different companies such as eBay (where he worked after his first year at business school right before the IPO), Kleiner Perkins or Microsoft. He ultimately decided to build something on his own so he created Baseline. With Baseline his aim was to fund and support those projects that do not necessarily fulfill from the very beginning the ideal of a VC fundable company. He managed to grow in a different way and he ended up getting great deals done like Instagram and being recognized as one of the best investors by the Forbes Midas List.

What are the 3 books you feel everyone should read and why?

  • “Delivering Happiness:  A Path to Profits, Passion and Purpose by Tony Hsieh. I loved it because if you think about Zappos, it is like “ok, selling shoes is already invented”. However, they found innovation through great customer experience. I believe we have to learn how to value these small details. Loyalty to a brand is based on details, on a personal touch. Tony had a vision of how to build the business and its culture in a differential way. And then we all read about the tragic end he went through … his ideal of happiness and yet his own personal battles, much food for thought, such a harsh life.

  • “Good to Great: Why Some Companies Make the Leap...and Others don't” by Jim Collins. A classic about strategy and not losing focus, methodical and well structured. You may have your vision and you can do a bunch of things, but you need to understand what is core and what is superficial to keep moving forward following the right path. Choose the right metrics to measure what is really important and analyze if your effort is helping you get closer to your core goal. The book gives you plenty of examples of companies following this methodology of focusing on the core and pretty big failures of companies trying to do too much and losing sight of the core.

  • “Lonesome Dove” by Larry McMurtry. Novel about two rangers from Texas embarking in the adventure of taking cattle from Texas to Montana, defying the wilderness of America. A story of embarking on a big mission, facing perils but knowing that arriving to your goal is the only way for cattle to survive. It is a great analogy to the entrepreneurs we see today, in the same way as the Texan rangers, founders start on a mission, and once the ship sails they bear full responsibility for the company they are building and leading the flock to a good place. Larry McMurtry sadly passed away a few days ago. A true masterpiece and a pleasure to read in every way.


WILDCARD QUESTION

VC is a major driver of change that succeeds by backing innovative outliers and diverse teams, however innovation and diversity does not seem really common in the industry. Being one of the few women in VC leadership positions, what are your views on diversity and how are you working to improve it?

Traditionally it has been tough for outsiders to get into VC because the community is so niche and teams are so small that all tend to look alike, so if someone is seen as different it creates a big question mark in terms of fit. As teams grow this creates a big opportunity for funds to embrace diversity.  Diversity brings different perspectives, enriches discussions and, as data shows, can actually lead teams to better decision making.

Why is this important? Bringing diversity helps teams overcome unconscious biases. Teams may not be aware about this but a room full of individuals from the same background, same education and upbringing and same gender fosters decision making that feels right but which lacks incorporating different perspectives.

Diversity is very broad and is not just linked to gender. If I am a woman from the same social background and business school education I may not be as “diverse” from the group as one might expect. Diversity is gender but also social, even religious or cultural. Diversity just exponentially adds, the more diversity, the better, assuming better is what fuels different perspectives and points of view. Fortunately for the VC industry investors (our LPs who ultimately fund VCs) are increasingly conscious about this and valuing diverse teams. That LP push will be key to see changes.

Yet it is not just about LPs, entrepreneurs may feel more comfortable if investors truly embody their reality. I believe diversity enables funds to connect more with founders. This is just a reflection of what society demands, VCs should grasp this and act. It is a complex topic and we will need more time but we are already seeing pretty telling examples such as Elon Musk not caring about new hires’ college degrees but exclusively about what they have done or Google also changing its recruiting policies.

And again, socioeconomic background diversity is just as important. How have people from less privileged backgrounds made it? You will find individuals with huge hunger and hustle, very different from other groups who have had everything orchestrated for them to succeed. A profile that manages to arrive against all odds and working her ass off may just happen to have more probabilities of performing better. This captures the essence of diversity, bringing people to the table who will look different and will have had different experiences to bring to the group.

Fortunately, experience shows that, when given a fair chance, many more can get a seat at the table. Making the effort to look for that difference will make organizations better and VCs are no exception.

And about initiatives, we are taking part in a few but I would like to highlight level20.org, a non for profit organization dedicated to improving gender diversity in the European private equity industry so more women of diverse backgrounds achieve relevant senior positions in our industry. Our mission is for women to hold 20% of senior positions in the industry, up from a 6% in PE and a 12% in VC. To do so, we are especially focusing on outreach programs to talk about our industry to young women at universities, and mentoring programs to help junior women at PE and VC firms get the help they need to arrive to senior positions.

Helping and supporting each other in concrete long-term initiatives taking into account not just gender and ethnicity but also socioeconomic backgrounds, will be key to building a more diverse investment community.


Big thanks Sonia for sharing your views with us !

Big thanks to you, reader, for your time and interest !

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