Hitting the right note in Silicon Valley

The Swisscom Outpost in Silicon Valley consists of a small former residential building with garage and garden. All rooms are occupied this morning. The five winners of the Swisscom Startup Challenge are meeting potential business partners or persons who can help them, with the staff of Swisscom Outpost mediating. Thomas Estier and Lucian Cucu, CEO and CTO respectively of Rovenso, meet Antonio Espinosa, an experienced serial entrepreneur and advisor who, like the two Swiss, is active in the field of industrial hardware.

The conversation is essentially about start-up funding. Estier presents his plan for the next round of financing and Espinosa draws his attention to other options. Financing hardware projects, such as Rovenso’s agile robot, which can replace, for example, security guards, presents a particular challenge since more capital is needed before entering the market and development is slower than in most pure software projects.

Espinosa explains what robotics firms such as Rovenso would raise in the Silicon Valley and how they would plan the next steps. “This gave us a new perspective on what we are doing at Rovenso and what we have already achieved”, comments CEO Thomas Estier. After the meeting he changed his pitch for investors. The objectives are now presented more aggressively. “Although the core of the pitch stayed the same we changed the message dramatically”, says Estier. In addition to the new perspective, Espinosa has more to offer: he can recommend investors from Silicon Valley that invest in robotics projects and similarly make contact with one of the backers.

Meetings do not always go so well and some are even cancelled at short notice. The fact is that nobody in Silicon Valley has been waiting for start-ups from abroad, no matter how good they are. So it is a matter of seeing whether the meeting can be rearranged for later in the week. Given the practice of arranging such meetings at extremely short notice, this is quite possible.

However, the majority of meetings are positive. For example, Eugenia Balysheva and Bruno Sanguinetti of Dotphoton, a start-up that has developed a revolutionary image compression solution for professional applications, meet the Sony Innovation Fund. A meeting to which the two co-founders have long been looking forward.

What is possible in these meetings when the entrepreneurs hits the right note shows the example of AAAccell. Sandro Schmid, CEO of the fintech startup, succeeded very well. “Our philosophy as a fintech start-up is “If you have a cure for cancer, you cannot sell it only to the rich investors", says Schmid. AAAccell products are based on several years of proprietary research done by worldwide leaders in the area of quantitative finance and AI/ML. AAAccell brings hedge-funds technology to banks, insurance companies, pension funds, and asset managers worldwide. Their products reduce the risk of investment portfolios and improve returns. The company has already won a number of high-profile global customers and can show figures proving that the approach really works. Talking to local US investors, Schmid emphasizes that interest in the ongoing financing round exceeds the amount of money sought, and several parties want to take the role of lead investor. He also mentions that a relocation of the company’s headquarters to the US may be a possibility. The entire case was well received by the US companies and large Silicon Valley investors rush to set follow-on meetings with Schmid.

Stefan Kyora's trip to the Silicon Valley is supported by Swisscom.