Building Global Ventures from Central Eastern Europe With Radu Georgescu
After the keynote speaker Alf Rehn, Radu Georgescu from GECAD Group took the stage. In a fireside chat with TeresCapital’s Max Gurvits, Georgescu reflected on the past three decades during which he started, scaled and exited a number of technology companies.
Radu first started in 1992 while he was still a student. He realized the potential of computers and quickly set up to build his first IT venture which he sold in 1994. Later on, he started and sold various companies, even making an exit with RAV antivirus technology, which quickly caught Microsoft’s eye.
This is Georgescus third decade as an entrepreneur and one of the main reasons he does this is because he likes starting something from scratch.
Nothing beats late nights, coding, working with your partners, trying to create a product that people just might use.
Making Money. It’s Not Easy.
Right out of the gate Max asked Radu how hard is it to build a company which is actually making revenue. He stated that building a profitable company is definitely not the easiest thing on Earth, but his team at GECAD Group has been doing it for the past 22 years and so far has had huge success.
Out of 30 companies that GECAD Group has invested in, 4 had very successful exits while 10 made some money, covering for the initial investment and time put in them. Other ventures weren’t so profitable but that’s just a part of the game, he adds.
Georgescu also pointed out that this region is poised with great technical talent that can pretty much make anything work. On the other side, lack of organizational skills and management has caused problems for IT companies for some time. In these situations Radu and his team strongly suggest that pointing an outside CEO might be just the healthy change some startups need.
Strong Ego Could Become a Problem
Ego is a big thing here. Founders would rather hold 80% of their company and the title of a CEO than give up management to somebody who can do it more efficiently and better. In my opinion, being a founder of something is much more powerful than just a CEO position.
This is also a huge thing that is being discussed with all the companies Radu and his team have invested in over the past couple of years. Regional talent is much more inclined towards coding and other technical issues, hence we should focus on things we are good at.
Instead of doing outsourcing development for US companies, we should outsource business development to US.
Closing of the fireside chat, Max asked Radu to point out why founders should be careful when choosing their investors. Georgescu stated that he’d never take the money from the European Union or any other government fund. This is a poisonous combination because when you take money form a government, you put yourself in a comfort zone and you don’t really care that much about creating your business.
Once you convince VC to put money into your company you have a business. Once you convince EU to give you money you just have a job.
