all About Investments
I have contacted Alexandru Bogdan, an investor at ROCA X fund, to discuss the ideal investment portfolio, the opportunities and challenges of the current crisis, and more about his activity as a business angel, in general.
SB: What do you consider an “ideal investment portfolio”?
AB: At ROCA X, I look for founders with extraordinary & future-proof ideas, that will resist challenges such as the current crisis. Ideas can come from various areas and fields of activity; many of them are currently very relevant and on an upward trend, due to the current situation. They can produce innovations for problems that perhaps, a few months ago, were not even considered.
SB: What is your willingness to risk in the short-term for long-term higher profits?
AB: From both a personal and a professional perspective, I would say that all investments are medium-term. A successful story in this field requires a rapid growth of that business, and perhaps, at some point, we will not be able to keep up with its evolution. Therefore, I do not see investments as short-term, speculative actions, but I am also aware that they cannot be long-term investments (7-10 years) either because I will not be able to keep up with the way they will evolve. The medium-term investments should be the optimal ones - we define medium-term as being 2, 3 up to 5 years.
SB: Define – from your perspective - two types of opportunities in a time of crisis, when it comes to investments?
AB: Firstly, there are several platforms, businesses, and initiatives that did not receive enough attention. Why? Because our society was used to the status quo. I was negatively impressed by one and a half years ago when I participated in a workshop about innovation and the evolution & success of Amazon, how they managed to expand and identify new business niches. The audience, which should have been very interested in new opportunities, had many voices saying that nothing will happen in our field, that things are set.
This crisis put a great deal of pressure on many businesses, a wake-up call to the reality that made them understand the importance of taking action, and that the status quo needs to be challenged. There is a specific dose of toxicity in the Romanian entrepreneurial ecosystem related to the lack of openness to new ideas. This crisis opened the eyes of entrepreneurs to new solutions that make their businesses survive and continue growing. I think this is the first opportunity that is universal, for everyone - regardless of the field and the vertical.
There are a few areas in which this openness had immediate effects, such as the medical services field – where, until recently, things did not allow a great deal of innovation. Still, in just a few weeks, quite a lot of telemedicine solutions have emerged. Those already addressing this need received positive feedback and were adopted by the market much faster.
Similarly happened in the education field, which is an old issue in our country – we all know the problems that parents have concerning the slow development of the classical education system, and their continuous search for alternative solutions. This rather aggressive push to homeschooling - forced during this period – has opened new opportunities. I hope that, in the next period, the development of education will be surprising and striking, in a positive sense.
SB: How much of your budget, in percents, have you allocated to your most recent investment?
AB: The latest ROCA X investment, which I think everyone already knows about, is Code of Talent, a start-up listed on SeedBlink's platform, in which I was the lead investor. If we are talking percentages, the amount represented about 10% of the total investment budget. It is one of our major investments this year - I mean for ROCA X. But this is the first situation in which "I put the money where my mouth is", as I also signed up as a private investor. In terms of my personal budget, the amount I contributed with would be at about at 20% of my funds at the time.
SB: What was the moment of your career that made you consider yourself a business angel?
AB: Here I would like to make a point: in relation to SeedBlink I have a double role – the representative of ROCA X fund, through which I have contributed to some transactions (e.g. EverToys), and that of a business angel.
The starting point was when the ROCA X project came to life when I started to get involved and learn more about venture capitals. I realized the opportunity and observed in me the desire to be active during the life of the start-ups. However, it is too early to say that I have a track record as a business angel. In any case, Seedblink's emergence is welcomed support, because it democratizes access to technology investments by offering accessible tickets to a wider audience.
SB: What are the expectations of a business angel?
AB: Aside from the opportunity to increase the income by using investments, a business angel, in general, engages in the very early stages of the projects of interest. For me, the biggest satisfaction is that I can feel that I put my mark on the outline of a new product that will potentially impact millions of customers.
SB: What do you think are the biggest challenges a start-up faces in the current context?
AB: I think the first significant challenge is that of correct acknowledgement. Start-ups – small companies with founders having a tech background, do not necessarily have access to reliable information sources. There is a wealth of information that is freely available on the Internet, but their level of clarity and trustworthiness is relatively low. There are not enough resources - after all, a start-up is a business at the start of the road that won't be able to finance many studies on their own - to discover the circumstances their clients are facing and their changes in behaviour.
SB: How could start-ups overcome these challenges?
AB: The good part of the challenge is that this community has assumed the role of supporting the entrepreneurs. For example, Impetum Group has organized and smoothed the communication among founders, allowing them to exchange their experiences & knowledge, to understand the big picture, as well as identify the challenges and opportunities they face in the current situation. This is the new spirit, not necessarily traditional to us, of sharing information.
One common factor that our sister company (Roca) & I have encountered, is that entrepreneurs found in difficult situations become very closed. This is a trait of our culture: we are not willing to share the difficulties or the successes, and we don’t trust much those around us. However, it is precisely this flow of information that can reveal collaboration opportunities and generate new ideas for saving the ecosystem.
SeedBlink Crowd SA is registered in the Register of the Romanian Financial Supervisory Authority (ASF), under number PJR28FSFPR/400001, as of 03.11.2022 with an EU passport as per European Securities and Market Authority (ESMA) register of crowdfunding services providers.
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