Giuseppe is Partner at P101 Ventures, based in Milan. He has 20 years experience in Venture Capital and Private Equity with a specific focus on technology and software. Prior to joining P101 Ventures he has gained experience in Italy, Europe and Middle East working with companies such as 3i Group plc and HSBC Bank. Giuseppe holds a degree in Telecommunications Engineering from the University of Pisa and attended the Advanced Executive Program at the Kellogg Business School in Chicago (USA). He began his career in the Telecom Italia’s Strategy Division. He holds several Non Executive Director roles in P101 portfolio companies.
Portfolio ventures that are going great need almost no support, and the ones that are in the bottom aren’t worth helping. Apart from the two extremes, how do you know how much effort, time, persistent to put in the ones that are somewhere in the middle?
It is difficult to give a general answer, sometimes also the portfolio ventures that are going great need time and support; vice versa a struggling company can be overturned with time and effort. With regard to the ones in the middle it depends case by case but a powerful driver is the upside potential we see in the target and the founders engagement and commitment.
How do you balance your time between (1) sourcing quality prospect ventures (2) doing due diligence for prospective investments and (3) helping current entrepreneurs? Which of these are you comfortable outsourcing to principals/analysts and which do you absolutely have to do yourself?
I spend most of my time on #3 but we work as a team at all levels. As a firm, we tend to receive high quality deal flow but at the same time we are proactive in searching and building the best deal. Helping current entrepreneurs is one of our real value added and especially at senior level, it absorbs a great amount of time.
Many GPs are good investors but don’t master one of the core skills – adding value as a board member. What do you think are some tricks to a productive relationship with founders? What should the culture be for the board and CEO for a quality relationship?
In my experience adding value as a board member has always been key; this means contributing to value creation with a very pragmatic hands-on approach. Giving strategic counselling to companies’ boards, looking for potential clients and partnerships and contributing to the development of strategic business agreements.
Furthermore, offering support in case of M&A, exit processes, financing rounds, helping with recruiting. Like every productive relationship, also the one with the founders must be open, constructive and sincere. Especially in tech, culture remains key to prosper and scale and it must come from the Board and CEO to permeate the rest of the firm.
How do you solve important conflicts with CEOs, such as lack of alignment on exits, strategy, or just the CEO being in denial about things like performance? Does the resolution begin with a private conversation or with involving other board members in a decision?
There is no “one size fits all” in this topic. If the relationship with CEO and founders has been based on openness since the beginning the issue will always be discussed sincerely and constructively. Same applies on the board side as usually everybody must be aligned on key decisions.
When raising money from LPs, what is the thing you emphasize the most when “selling” the fund? Past returns? Team expertise (domain and/or entrepreneurial expertise)? Unique angle?
Raising money successfully comes from a mix of success points not just one. Team is key and drives everything; experience, returns, unique angles and culture are all related.
Key Lessons from Giuseppe
- As a board member, have a pragmatic approach. Contribute to value creation. Look for potential partners and clients. Contribute to business agreements. Help with potential exits and preparation for the next funding round;
- With CEOs, bet on sincerity. Every relationship starts with trust. The board should be aligned with the CEO and trust him on key issues;
- Raising from LPs, the team is key. Experience, returns, the unique angle are all driven by the team;