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Spain Is Great Again!
After not having been there in 7 years, I almost didn’t recognize Madrid: Streets were busier, the food tastier, the sky bluer than ever between the ochre walls of la Plaza Mayor. Even the posh Salamanca looked funky. And I don’t want to mention the startups there.
Trying to rationalize my romantic surge, I took a look at the figures. Spain is recovering fast. In 2015, investors injected $664 million in Spanish startups, versus $363 in 2014. Between 2015 and 2016, the average ticket jumped from $250k to $650k. Even if Spain is still lagging behind the UK, Germany or France, it is growing much faster than them.
The 3 key takeaways from our May trip
- Everybody is “capital efficient”. We heard it more than once, both from the entrepreneurs and VCs. Understand that Spain has known a long decade of cash scarcity, with smaller funds, pale corporates and a bloodless consumer market. In that context, each euro counts, and both founders and investors are particularly picky when spending their money. This great quality could yet dampen their enthusiasm to tackle big I&D projects or mass consumer markets. Get lean or die tryin’.
- Spain first. All the Spanish VCs and CEOs we met welcomed us warmly, with no exception. They were glad to learn more about us and seemed very open to host French co-investment to feed their champions. Regarding the reciprocal flow, we felt that France was not their top priority, coming well after Latin America, UK and Germany. For now :)
- The difference between Madrid and Barcelona. Using the most refined and secret due diligence and interview processes, we finally hacked THE question. Long story short: Barcelona is more internationally talented and focused with a strong sweet spot on BtoC ventures and tourism, while Madrid is open to Spain and Latin America and cherishes the relationships with corporates.
We give a special thanks to all the VCs, angels and entrepreneurs who brilliantly welcomed us during the trip :)