From working with CEOs across the world to help scale up their businesses, I’ve learned a lot about the company perspective of scaling up. Of course, we share all of this expertise directly with our community on the ScaleUp Valley podcast. For this reason, we wanted to take the conversation to the next level.
That’s why, on our most recent episode, we hosted our first featuring an investor, so that we can really compress the key lessons from businesses that are scaling from $1 million to $100 million and beyond from the investor perspective for our listeners.
Sitting down with Gonzalo Tradacete, the man behind Faraday Venture Partners, I gained a lot of insight into what they look for when searching for new investments to scale up. All of this is shared with you on our latest episode of the ScaleUp Valley podcast. Listen to the full episode or read my highlights here.
Innovation within the VC space
From the age of 13, Tradacete always knew that he had the entrepreneurial spirit. It was no surprise then when he decided to take his experience in investment finance and build his own company in this field.
In 2011, he put together an investment group that, in his own words, is most similar to a pledge fund. With the Faraday model, the members of their investor club can choose the amount that they want to invest in each company and are required to take an active role in finding success for that startup.
The way he puts it, “We’re not just in the transaction, but we transform ourselves into a VC partner.”
In this way, Faraday has become a hybrid between a business network and a venture capital fund. This innovation in the VC space is really difficult to achieve, so it’s something that we’re excited to welcome into the ScaleUp Valley community.
Of course, the most important thing we can ask investors is what they are – or are not – looking for in their future partners.
What Faraday looks for in the businesses they choose to scale up
Tradacete described their approach to finding new companies as “totally agnostic” meaning that they do not define themselves to be in any particular sector. Because of this, they shift more of their focus on the attitude of the person sitting in front of them.
They really believe in the value that their investments provide, not just to the companies that they are choosing to support, but to society. If they feel like they’ll be spending board meetings in yelling matches, then that’s not a company that they wish to invest in.
From there, they use a bottom-up approach to help bring their companies success.
Of course there’s a lot more that you can take away from Tradacete’s wise words. So if you want to hear more about how they make their selections, listen to the whole episode of the ScaleUp Valley podcast here. Then keep listening and keep scaling!
-Mike Dias