Jakub Havrlant: Czechs Have Small Ambitions

How can a student from Silesia, within a few years, become a venture capital investor who has hundreds of millions CZK at his disposal?

I started my first business as a student of the University of Economics when I launched the Internet project Bezrealitky. I was working for a consulting company PwC and I left it because of this project. At that time, me and my friend started to search the sphere of the Internet. Bezrelitky.cz was a certain entrance to the world of technologies. We were given money by the angel investor Kamil Vacek, who, at the beginning in 2007, supported us and helped us. Two years later, Bezrealitky was purchased by Allegro Group for tens of millions CZK, and I was looking for new opportunities. I started to work in the digital world and invested into a digital agency. After some time, I was given an offer from South African group Naspers, where also Allegro belongs to, to help them in this region and lead their activities.

What did the experience with such a big company mean for you?

This chance gave me the possibility to see bigger numbers, perceive things in international context, and to make better use of the ideas and experience in the field of e-commerce (business on the Internet, Ed.). Last year, I decided to work on my own business and I left Allegro. I started to work more in the role of angel investor for start-ups and joined all my activities under Rockaway Group. I was working on my own investments even while working for Allegro when I was developing  investments in Brazil. We succeeded there with Zarpo company (private travel club focused on demanding clientele, Ed.), which is targeted at the turnover of a billion. Brazilian projects became a part of Rockaway and I started to build a bigger investment group systematically. Every day I make an attempt to move it forward. 

In Rockaway you have 300 million CZK prepared for investments for this year. What have you invested in so far?

We focus on Internet services for consumers; transactions in e-commerce. We divide our perspective into three parts – one is local market and we have targeted the majority of our activities here as we see the Czech Republic as a rather conservative form of portfolio. Brazil is for us in the same position. The advantage is that Brazil is much bigger market, so the numbers are proportionally different. We try to improve the services also in the sphere of finance – in Brazil to the company Bankfacil; in the Czech Republic we bought the company Bonet. At the same time, we also look at travel business – the company Bileto, trains, ticket sale, aggregated search of transport connections. The third pillar is technological things with global aspirations which is work for a few more years.

In how many companies does Rockaway have the share?

Officially in fifteen, however, we have something in a kind of invisible mood. It works in such a way that we make an investment and we do not communicate it for up to three months and we work on the project quietly. It is a standard procedure. Many funds do it this way. You can make a mistake and you do not want to shout it out. Moreover, it is important to keep yourself on the ground and do not alert others that something is changing within the segment. Even for a starting company it is better to start quietly and work under less pressure. 

You are focused on transforming traditional services to the Internet. Where can you see other opportunities?

Mostly in semantics, in the field of big data, logic; also in the work with individual groups of customers, help to create basis of customers and their needs. For instance, I find Storyous.com (social network focused on evaluating restaurants via an app, Ed.) as a good example of where the whole segment is moving. Thanks to this, a restaurant is more open for the customer. Suddenly, the chef can work with the customer. How can he get some feedback today? He can give out papers or ask the people. This is more simple and efficient way. It is all about data that flow. However, it is necessary to have good data analysis and put them into certain formulas on which it is possible to react with content or marketing. That is where the money is and people who work on the Internet can see it.

You are a strategic investor in domestic Leo Express railway carrier. You have increased the share to 10%. Are you happy with this investment?

It is in this dimension, we have certain options there. The whole segment of transportation is very interesting for us, because this sphere has not gone online yet, and there is big potential for new technologies, for instance the ticket sale via our web portal Bileto. We are also interested in the information system which belongs under Leo Express. In transportation we see a huge space for implementing IT, data and marketing systems. Today’s transportation is extremely insufficient, there are or were mostly state-owned companies which are off-line; and their work with the customer is non-existing. Our ambition is to bring online services, and the fact that we have the share in Leo Express makes it much easier.

Do you trust Leo Express despite last year’s loss of 160 million CZK and problems with debentures repayment? Are you going to increase your investment?

As I have already said, I believe that there is a big space for disrupting the existing model, and whenever you break such a model and create some added value, the business is interesting. As far as time is concerned, it is related to investment into transportation systems as such where we have standard investment horizon of five years. Our motivation is not to have a prosperous train carrier, but the possibility to build whole online system around it, and we start to succeed in that. Bileto is set for five more countries. We want to increase the value of investment into Leo Express in this way.

What advice would you give to businessmen in a starting position?

It is important to settle with what team and prospect you go into it. And then make the business decision. We avoid people who want to work on a project and keep their regular job. Most of them cannot imagine the whole journey from the beginning to the end. These companies are to fail and mostly do not even manage to get to the money. It is important to set a business commitment and have a clear idea where one wants to get. Moreover, the problem in the Czech Republic is small ambitions, which comes from little knowledge of the global market. Internet attracts many clever and experienced young people from different spheres, but they do not know properly how it works and they can underestimate some things. The role of the investor is then to define the strategy, financial plan and help them scale the product so that they can go abroad faster.

How much money have you put into starting businesses this year?

This year, we have announced Brazilian Bankfacil, global Brand Embassy, Storyous and Bileto. Apart from these, there are several other projects which are crucial for us, but which are to be announced later – these will be key activities of the whole group. We still have 100 million prepared for investments where we advance according to a set strategy. Next year we are going to enter mostly global projects outside the Czech Republic.

The interview was published in magazine Týden.