 Let me start us off by saying it is really a personal honor for me to be on stage with the three of you We're here to discuss building billion-dollar European businesses, and I can't think of better people to do it with we have Magnus and Mons CEOs and chairman of billion-dollar companies started in Sweden expanded to all of Europe I Zettle and click-tech for those that were less familiar and Laurel who has invested in multiple billion-dollar European companies Including I Zettle click-tech just eat hybris and Salonis, and those are just the European billion-dollar companies She's invested in so shall we start Magnus and Mons, can you kick us off by talking about what you think some of the key success factors are in building your respective companies? Magnus, do you want to start us off? Yeah, well I think Yeah when when Jacob my co-founder and I started I Zettel I think we thought a lot about a number of different things, you know, we thought about How well technology that we were going to apply would scale we thought about Distribution how would that scale so that we could really grow quickly and Actually, we spent quite some time also on culture And how that would scale across different markets in the world, so I think all of those are were critical things that we really tried to understand Before we launched our Products Mons, was that similar for you with click-tech or maybe there were other points? Yeah, absolutely I always think of it as Being four pillars where the first one is really understanding your market In a in our case we discovered that our competitors at the time were only pursuing a small piece of the market which at the time was Considered to be a five or six billion dollar market growing 15% annually and we realized that the opportunity was couple probably several hundred billion Dollars, so that's the first pillar really understand them with standing what you do and How you are uniquely positioned to pursue that opportunity and then the three others are kind of natural after that because they I mean the next thing would be to to build a solid go-to-market model the Build out your your organization and for me something that's very very important is Is is building the culture and values in the company? Culture seems to be interesting last but very important criteria both of you have These are a bit more you want to say about what the key key cultural components were that helped drive the success Well, you know maybe sound a bit Easy in some ways, you know, everybody speaks about culture and how important it is And I think for us, you know We've tried to iterate many times as to what are really the values that we stand for and we you know We're looking to democratize financial services for small businesses and and how can we do that? And how can we so we created sort of three key components, which was easy reliable inspiring in which, you know, anyone could could have that so That it's about how you fill that with meaning and and live with that, you know And and very small things like When you come to our office, we've tried to say that it should be like, you know a home away from home So what does that mean? So it means that you have music and candle lights when you actually come in the morning, which is quite nice Especially this time of the year But more importantly, so when I walk down the corridor in our office Sometimes you find things papers and stuff lying on the floor and you could stand there and you could see 50 people walking by not Doing anything, but if it was at home, they would pick it up Yeah, so I make a point of always doing that You know, that's just a very small example of living the culture small but big We're going to pull you into this 83 North your firm has invested in eight billion dollar businesses What do you think has enabled your firm to do this your secret sauce if you say if you've been sharing and what? Perspective did that give you so that when you met Magnus and Mons you saw the potential for what they could be? I Think one of the first things that differentiates us We don't do a lot of investments probably about one per partner per year And when you you know when you can when you was that in mind you can end up being, you know Very selective when you don't have a gun to your head to deploy capital And you don't have any incentives to deploy capital either And I often wonder, you know if we gave all the VCs all the partners and said you can only do 15 investments in your life You know, I think that might change the way you approach investing I Think the you know the second thing because we don't do a lot of investments We end up building very strong relationships with our founders You know two of them sitting here two great examples many of them become advisors to our fund. Don't worry Magnus We just got your office soon And and so that becomes sort of a critical source of deals for us So I think that's one of the key differentiators and then on talking about the companies I think look to start with click-tech You know, I agree with months. We thought the market was enormous We really like the way that months and his team had turned around the company because click-tech had been around for a long time And going no way before months found the company And then we thought we could help them quite a lot with us expansion And then with Magnus and and Jacob at Isethel Actually that deal, you know just to contradict myself didn't come through any of our networks where which was unlike click-tech In fact, we had done quite a bit of research on payments and came across Isethel and what we liked about them You know, we thought firstly be like the mix of Execution experience and product experience between Jacob and Magnus. I thought the market was very big We were very worried about competition Which later, you know became a you did become a real issue Yeah, and just thought that you know, they would execute and would win the market Which I think they you know that the show is still on but it's definitely turned out to be true Well, let's talk about tough times because it's always you know When the what's that statement when the waters are rising all ships go up or something But when it's when it's hard right? Let's talk about times There are challenges in the business and then how do you work with your investors? I'm sure lots of folks in the audience are are worried if things get tough investors run away So months maybe you can start us off by sharing some challenges you had and potentially there was some interactions with investors Sure, sure well for me the the most challenging time in the company was Actually right after I invested which was in the beginning of two thousand two thousand and I got on the board only to realize that the founders of the company had really cheated us when they presented a company So so it was it was very much of a train wreck honestly so I had to Step in and become the CEO only three months after I invested in the company to try to turn the company around Which was completely unplanned and and I wasn't I wasn't prepared for this this was the time this was the first time for me to become a CEO and I had no formal training no education whatsoever to prepare me for that I just happened to stand in the room when we took the decision to replace the the current CEO and You know for those of you who were around in two thousand you probably remember that that was the year when the so-called IT bubble burst So I became the CEO in May the the bubble burst over the summer and the the market was Completely drained of capital and we were running towards bankruptcy in an amazing amazing speed so That was obviously very tough One of the first things I had to do in the company was to call the local bank and tell him that the credit They had given the company couldn't be repaid. So we had to meet After a few months we also worked with funding by the way and we were we were fortunate enough to have to have angels that trusted us and supported us which was a blessing but But after a couple of months I also had to to downsize the organization which It's hard. It's not my favorite Yeah, Magnus. I'm sure there's some learnings there. You can share with the audience and maybe maybe times when Laurel was I mean, you know, it comes with with With lack of funds basically that's what she's threatening all the time You know, you make plans and very often you hit cost dead on and revenues are failing in one way or another and in our case There are two instances one was an external Just after Laurel invested actually Where where visa Europe actually pulled the plug on us and we lost 75% of our revenues in all countries except Sweden That was a very very difficult time both, you know, phasing investors and Just getting to terms with what do we do now to and really, you know, in a way billions of dollars Disappeared in value a potential valuation for the company because we had to change everything business model The the hardware we were providing so it was incredibly tough times for us. Even if we had funds, you know It was a dreadful actually So there's something you want to share a little about your memory of that time about how does it as an entrepreneur and an investor Work together to get through those kind of rough patches. Yeah, actually, I remember that very clearly We closed the investment and you know, maybe I don't know how other investors feel But normally when I when I close an investment, I am literally terrified And as much as I'm happy to do the investment or happy to have wanted it's it's frightening You you know, you're signing away other people's money So you always have the sense and in this case actually I had some of months as money as well as my funds and So we closed the investment you've got this mix of happiness and worry and literally a week later Magnus calls me and says look, we've got some bad news We're shutting down the UK Denmark Finland Norway and we're not going anywhere else. We're staying to Sweden and I have to say It was pretty terrifying. I had to then probably a couple of months later go and report to my investors At my LP meeting as to this why we invested in the company and what had then happened But I think that's you know, if I look back in my history of investing, you know Resilience is of founders and and and passion of founders and Desire to find a way forward. You know, that's sort of the thing that marks the kind of people I think we've invested in and you know, it's been an honor I guess to work with people who always find a way and Always find their roots through a hard time and you know reinvent the company Stabilize things and move forward and of course, that's exactly what they did Apparently so it's a new chip and you know found new markets and solve the problems with visa But I think it deserves to be said that many of the most successful companies has actually had at least one near-death Experience so and I think that there's something about that really strengthens you so you go go through that You know sometimes with the organization and it just sharpens the mind I'm sure any other particular points that you remember there were that I or mind sharpening Well, that was one other event when I guess a few months after you invested or maybe a year after you invested I was about to miss the fourth quarter of that year and We were sitting in the boardroom in in Lund where we had a headquarter at the time and And had a very very tough discussion and one of the board members in particular was extremely tough with me I don't know if you remember that I do so and I was completely shook up and And after the board meeting and people could hear people in the organization could hear how they were yelling at me in the room Which of course is a bad thing for me So after the board meeting I went out to the office and had kind of a town hall meeting I stood on a chair and said You guys have to help me now because we're significantly significantly behind and I need your help to pull in everything we've got so we make the quarter and The miracle happened And I think that's that's something that comes with strong culture. I Cannot emphasize the importance of culture enough. So if people go there because it's fun you have a you know a Serious sense of belonging to a team People, you know really like working for the company and so on That's gonna show when you have tough times. That's when the you was you will see if they stand up For you when the times are tough then, you know, we have a good culture Well, if you were to go on I think that that you know and also what we've experienced in Isaac as we've grown is that you know It becomes more and more important, you know And you need to because you want to be nimble and fast and flexible and and then you know as you as you become bigger You need processes and things that slow you down and and sort of you know You risk losing the entrepreneurial feeling in the company. So that's you know And I remember giving a speech about that in our first summer party and everybody looked at me and didn't listen What is he talking about? You know, this is not going on at eyes at all But now they understand that we need to fight every day and when we have introductions for new employees, you know That's one the one thing I tell them is it's your responsibility to challenge your manager And they it will not happen automatically. You need to have courage. Nothing bad will happen And that is is incredibly important if you want to keep the vitality also when you get a bit bigger Well, what advice would you add to their they've shared from the investor perspective? About what CEOs and founders could think about in general or potentially when raising capital if the advice changes at all We'll just relate it to a couple of points that they said I think You know when companies are moving to the US and and many of you will know this I think it's critically important that a founder at least one of the founder moves And really important for culture to set the culture in the US office I think what we've also often done is move some more junior Employees but employees that really embody the culture to the US and actually in one case Which I thought worked fantastically. Well, we took a guy that was just an outstanding business development guy in our in our German office took him across with the CEO and wrenched him out of this role and made him head of people And we did it only for 18 months, but it was just brilliant because he you know, he interviewed everybody He hired everybody he talked to everybody and you know about the culture about the organization Of course when he was in the US, you know, he had easy access back to the office in Germany So I think that was you know that that that made a lot of sense The the other point about hiring and and culture I I really think that sometimes, you know Both actually both investors and founders like to think they see these fantastic VPS VP sales, etc in the US And often want to hire them people with tons of experience actually We've we've had a lot more success in hiring younger very smart very driven married motivated people who want to grow a lot And I think you know I would advise Anybody moving across geographies to think about that rather than to think well I've got to have I'm moving from France to Germany and therefore I need a very experienced German person I'm not sure you do And then you know just I think you know like we've talked in most companies have ups and downs I think you just want to make sure that your investor you choose has gone through some of those ups and downs Because you know, I had a company call me the other day. I won't say where's was with there was some issue around Actually fraud in the company and I think in the end the the CEO said to me Oh, the best thing was that you guys remained completely calm helped us to solve the problem as opposed to you know panicking We could have panicked if I told you what it was about you would probably start panicking So I think that's that would be the other piece of advice Let me stay on this this a bit of topic about of talking about some of the experiences You've had investing in companies in different geographies So you invest in Israeli and European companies along with us What do you think sets apart the Israeli and European companies and Magnus and Monty's essentially talking about you So feel free to chime in afterwards So there is they're both Swedish I not Israeli but still From the US I think the key thing is of course you you know the Israeli and US company Especially if they software and so was less in the case in Magnus But they have to go to other geographies and often to the US and I think that's tough It's tough from all the things they've talked about culture. It's disruptive But I think it makes you very resilient and makes you you know when you do need to then go to Asia in a way easier I Think in Europe one of the differences is you know you can You Europe can be its own market So, you know we invested in in just eat in eyes Ethel and both of them never needed to go to the US They could they had to go to multiple European countries Just some of the South American ones, but they never needed to go to the US I think you can build, you know very big companies in your own right, you know coming out of Europe Obviously, you know you if you have if you look at the US company, they have a huge home market So when you when you want to expand the European company you need to be in some ways You need to be smarter, you know, how can you find ways to scale across? Countries and and I think at least for us, you know, we We've you know people tend to think about we go into France or we're going to Germany But what we have found is that the key is really not to go to think like that But rather think you know take a city or even part of the city and build that and then that will start to expand and That's you and then you go to the next city and over and after a while you have a country But but otherwise you will spend so much money Before you understand how to go about things and how it how to get scale from distribution and so on so to me I mean, it's like uber is doing basically and I go city by city But but to me that's that to find you know the market and not make it too big Is something that I think you need to think a lot more about being European and being American in that You don't have the whole market No, no, no say this sounds like this was the is et al expansion strategy that start in Sweden and move out And was that similar for click tech or did you use a different model? You mean starting in Sweden expansion yet when you were thinking about I mean, I think the difference between click-tech and and I said the least that we expanded to more countries So when I left the company after 10 years in early 2010 we had customers in more than a hundred countries Around the globe and all continents that the joke is we had customers on all continents with the exception of Antarctica So but you know, you can't sell a lot to the the penguins I guess yeah, but what I what I was about to say is that I think An advantage that you have as a European company is that you know, obviously You keep European companies make a lot of stupid mistakes in the US And it's very hard to get into that market because Europeans don't realize how big the difference is in culture between Europe and the US But at the same time the American companies make a lot of stupid mistakes in Europe, too And they make a lot of stupid mistakes in Latin America and Asia and and Australia and what have you so? And I think it's easier for for European company to to penetrate Latin America for instance or you know Yeah, whatever Asia or Australia or what have you because that's They I think the culture that we come from resonate much better with Most countries in the world. There's a couple of countries that are truly different So United States is one that I would I would rank China as one that's very different to Japan is obviously also very different most other countries that I've come to Have more things in common with with European countries Then then then then thinks that differ. It's interesting Can you also all speak about the pace of expansion? How do you gauge how fast or how slow? It sounds like it was a critical piece of the business But we had lots of discussions because Laurel thought we were we had two high ambitions in number of countries They were gonna go after and so on and you know in retrospect. She was right, you know I think so I never told her then but but you know I thought so too So so you know I to really make it in a country and or in a city and then expand it is so much more important to get The real position where you start that you fully understand the the the opportunities that exist in each country Market that we are addressing is huge, you know So so there is no need to go to 50 countries immediately now, you know with being part of PayPal we have Over it over, you know going forward I guess we will have lots of opportunities to go to new markets that we're not in today And it will be cheaper for us to do that than if we were to do it alone But generally speaking Finding product markets fit and really penetrate a market much more important than taking 10 markets and doing a half-hearted job Did you I just wanted to chip in because Most companies that I see make such stupid mistakes when it comes to market penetration the obviously when I mean it would be sort of natural when you if you see a multi-billion Dollar opportunity that your your instincts would tell you to go out and try to be everywhere as soon as you ever can Nothing could be more wrong. Hmm. You have to start the other way around So you have to when you start your small unknown company with a very weak brand name The first thing you have to do is define a piece of the market that is small enough for you to dominate in 12 months And that's tough because it's a it's a It's a mental exercise that we don't seem to be built for but if you do that and you focus on that market And you really really win and dominate that market You will find that it's much easier to expand and then sort of build the circles like you If you peel the onion the In the reverse is that the right term? All right, I have a question from the audience and to read it quickly because we're almost out of time Can we expect a higher growth rate of companies with billion dollar potential? Comparing to the US with regulations like GDPR I think the point is do the regulations gonna impede growth potentially in Europe, or maybe it's an advantage Quick answer what quick answer to me is I don't think it's actually makes life more difficult, you know I think we have just the same Possibilities to grow of the business anyhow and actually if you if you master it You will actually have a barrier entry from others to come in Any we've 20 seconds any other I don't think it's about GDPR or regulations I think if you have a large market opportunity and and you have a unique position on that market It's much more about your own ability to penetrate the market and build your organization last thoughts I Think that's right. It depends on the timing of the market I mean some companies have the luxury of time and don't have to go that fast just eat in its early days 2000 was like that On the other hand, I think I zettel needed to run I mean you had to penetrate your markets But you needed to get into a number of them fast because you had competitors I think it depends on the and then software you got to be super careful because I think if you go from Weaver Paris or Frankfurt to the US probably that's what you should do in year one and not try to go to three or four Countries because be really hard to get the sales enablement, etc. Right. I think it's you know company by company You shouldn't worry about regulation. That's not the that's not the difference Defining point excellent. Well, we're out of time. So I'll have to say thank you Although I would love to keep listening really appreciate the authenticity and the real-world stories I'm speaking on behalf of the audience. I'm sure they appreciated it too. Okay. Thank you. Thank you