Sramana Mitra: How much maturity do you want the project to reach? What is the benchmark that you use before you spin something out?
Lauri Kinkar: When the first few enterprise customers with a prominent track record are ready, provided that we understand the reasons why they are ready to pay for that solution and we have a pretty good idea from them what the pain point that this solution is solving for them.
If we are still struggling with the whole product/market fit, then there is no point in making this a separate venture.
Sramana Mitra: What is the current state of these companies? How many customers do each of them have? Can you give me a summary of what each company does?
Lauri Kinkar: Compared to the startup success stories of today, we have spent an enormous amount of time. The group currently consists of about nine companies. Some of those are working more closely together. Some of them are a little bit more independent from the group.
On top of that, we have done 20 startup investments as well. As I mentioned, there is a company that handles mobile payments. They have a platform that enables receiving mobile payments in about 95 countries. They’re working with the likes of Spotify in Asia.
In terms of customers, they probably have a few thousand companies that are collecting mobile payments from their customers. Team-wise, it’s about 65 people. They’re in the €20 million to €30 million range.
The company that I’m currently involved in is called Messente. It is a time-critical messaging platform. Let’s say your flight is delayed. You get a message in SMS or Viber. About two million messages go through this platform per day. That puts us at around €10 million. There’re 22 people currently. The team sizes are fairly compact.
Sramana Mitra: All of the companies are of that scale?
Lauri Kinkar: The rest are smaller. The smallest one is near €1 million. The rest are somewhere in between.
Sramana Mitra: Across the group, you have about nine companies. The companies range is between a million to €10 million.
Lauri Kinkar: Yes.
Sramana Mitra: All of them are self-funded? You’re funding them from within the group?
Lauri Kinkar: They are all self-funded except two of them that have raised one round of VC investment. It has been a single round. The last round we have done was in 2013. In the past six years, we haven’t needed to raise more.
Sramana Mitra: There’s absolutely no reason to raise money if you don’t need to.
Lauri Kinkar: When you spend enough time among the tech startups and the startup scene, the culture there might be a little bit different. If you don’t need the money, you don’t raise. The general culture that surrounds tech startups is that money is raised easily.
Sramana Mitra: What I said is not the belief system in a lot of the startup ecosystems in the world, especially Silicon Valley. People raise money because raising money is considered cool. Raising money is a bit of a chronic disease. I have grown up with that mental set. One of the reasons I founded One Million by One Million is to go against that mental model.
Lauri Kinkar: It’s absolutely unnecessary at times.