Since growing and selling a company for 10 figures, Brian Requarth has created a community and fund for other entrepreneurs aspiring to create highly successful startups of their own. His company, Latitud, attracted funding from top-tier investors like David Vélez, Carlos Garcia, Ann Williams, and Daniel Vogel.
In this episode, you will learn:
- Fundraising and being persistent in landing the investor you really want
- M&A and integration
- Brian Requarth’s book, Viva the Entrepreneur
- His top advice when launching your own business
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For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
The Ultimate Guide To Pitch Decks
Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).
Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.
About Brian Requarth:
Brian Requarth co-founded Viva Real and was the company’s CEO from 2009 to July 2016, when he became Chairman. The company bootstrapped its operation and eventually raised over $74 million USD. Under his management, the team scaled to over 500 team members and acquired sugarhouse, a leading real estate CRM provider serving home builders and data company Geo Imovel.
He led merger negotiations with ZAP Imóveis (owned by Grupo Globo, Latin America’s largest media company). The deal closed in December 2017. Requarth is Chairman of the combined company, Grupo ZAP.
In March 2020, Grupo ZAP signed a deal to be acquired by OLX Brasil for R$2.9bn. The deal was approved by anti-trust authorities in Brazil, and the transaction closed on October 30, 2020.
As an angel investor, Requarth has invested in 40+ tech startups in Brazil and Latin America, and he has recently started Latitud, a new project focused on helping early-stage founders build iconic companies in Brazil and Latin America.
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Connect with Brian Requarth:
Read the Full Transcription of the Interview:
Alejandro Cremades: All righty hello everyone and welcome to the dealmakerr show. So today. We have a very exciting founder. You know Gura and a portunistic founder that has been traveling. You know all over the world I think that you guys are all going to find his story. you know, unique you know remarkable and and also very inspiring. So. You know again, you know talking all this stuff that we like to talk about building scaling. You know, financing exiting. You know he had a really remarkable exit to that we’ll talk about but without further do let’s welcome our guest today Brian Rickworthth welcome to the show.
Brian Requarth: Um, Alejandro thanks a lot for the invitation. It’s a pleasure to be here.
Alejandro Cremades: I mean it’s always nice to have people that know how to pronounce my name. You know, very well you know that’s that’s not the case always but but Brian here what I like to do is I like to do a little of a walk through memory lane. How was live growing up in California.
Brian Requarth: Um, back.
Brian Requarth: Life was really really you know I grew up in ah in a very kind of supportive household. Um, you know I’d say kind of middle class upper middle class. My dad used to joke that I’m gonna have to claw my way up out of the upper middle class. Ah so I had a comfortable life. You know it’s a life of privilege for sure. Um. And but really definitely my parents instilled hard work in me and that was something that ah you know they they made me work for everything that you know that I got and that was something that was you know critical, but it was a small town 7000 people Northern California kind of like a little bit of hippie you know hippie town and. And so yeah I grew up in ah in a small town I was ready to see the world at at some point.
Alejandro Cremades: And and in your case Brian I mean something that I find incredible is the way that throughout your life. You know you’ve been totally okay with dealing with uncertainty and that uncertainty to be able to reach whatever opportunity that you had in front of you know and I guess how did that. Come to you I mean did you have people in your family that were you know entrepreneurs. Um, you know business driven. How did that come to you.
Brian Requarth: If I think about the influence that I had for my parents. You know my mom was a kind of more of a you know social you know impact someone who was really involved in the community and did a lot of things you know, kind of helping others almost some degree. You know, just really selfless in the way the which she which she did. My dad was an entrepreneur had ah had a small ah but local business paving Company. So I’m kind of this juxtaposition this you know combination of I Like to think both of those qualities and so very supportive Very you know. There’s a lot of times when I think and now that I’m a parent and I look back and I you know I think about the way they navigated my ah comfort with not really knowing what I was going to do or you know like certain things around my path that looks like oh that doesn’t look like it’s headed in the right direction. You know? For example I ended up studying you know Spanish That’s why I could say your name. Where like you know they just never pushed me in any direction and they were very. They were very good at promoting whatever I was passionate about and then they knew that I would figure things out from there and so that’s something that I try to ah you know extrapolate from the lessons I had as as a kid and try to bring that to my kids where. Foment and and help them develop the things that they really love and are passionate about. So I think that enabled me to be comfortable with uncertainty.
Alejandro Cremades: Um, and and out of all things why Spanish Why did you study spanish.
Brian Requarth: You know it was one of the only things that I was like I felt like in school I took a spanish class and I had a great spanish teacher miss winters shout out to her if she’s listening but I remember I just felt like I was really good at it and I and I and I and I understood it really well and I wasn’t much of a student and so I wasn’t. Thriving in the traditional education model and so I ended up just deciding and and also I love travel too and so and I love communication and so if you take the you know the the combination of being able to communicate and being in another place. It opens up this world of opportunities for you where you’re. Your horizon expands and you get to learn about different cultures and that was always something really fascinating to me I had a a professor in college that used to always say legua Esqutura language is culture and so I realized that if I could learn the language I could learn the culture and then I could expand my kind of. Understanding of the world.
Alejandro Cremades: That’s incredible now talking about implementing you know spanish I mean once you, you’re done with it. You know you decide to pack up and and go Chris Grossing you know they’re in Latin America for six months I mean that. I’m sure that was wild and full of incredible experiences. But but what trigger that and and and tell us what happened.
Brian Requarth: I remember you know having a conversation with one of my best friends. Ah you know and we we you know we just finished college and it was this kind of moment where you know when you’re in college. It’s kind of you know you’re going to college you get that question time and time again like what are you going to do with your life. What are you going to be. And and it was the moment where there was like this period of forgiveness on like you’ve got an open window where you don’t have any responsibilities. You know you’ve got kind of this this blank slate of what you want to do with your life and so I yeah took advantage of that and wanted some adventure I was craving adventure I was and craving. To be thrown into something completely different and be exposed to something different. So as you said I got in my car in California as boero Blanco the the white donkey was ah it was a Nissan pathfinder and we just we drove south and we you know crossed over in and matamotos in Texas. Ah, you know and and you know on the Texas border and we just started heading south and it was just every day was an adventure and you know I realize kind of on you know and early on that trip is that when you put yourself in new situations. It kind of forces you to learn and it and that discomfort you know that moment of being somewhere where you. You know, maybe don’t fit in perfectly. It just forces you to figure things out and so that was the motivation was really just adventure seeking and you know and and and also wanting to see the world and just the I guess an undying curiosity is something that I think has been a motivator for me for a long time.
Alejandro Cremades: And obviously you know like as part of that Journey. You know it ended up with a very successful outcome and that was you know, ending up, you know, like meeting or or being you know with who is now your wife and during this time. Also you ended up becoming an English teacher. So. It’s a very interesting journey ah becoming an English teacher and and really taking it all the way to becoming an entrepreneur. So What were the sequence of events that needed to happen in between. So.
Brian Requarth: Well first of all I met my wife Andrea she’s from Columbia and we met in San Diego in in California and we dated and she went back to Columbia after she finished her. You know her semester there or work experienced. And so I you know I got I got my car and I and my plan was to make it all the way to Patagonia when I set out on that trip and so after crisscrossing Mexico for you know, five and a half six months I got to Costa Rica and I and I bought a 1 ne-way ticket with the you know the goal of you know, just checking out and see see what things were like in Columbia seeing her. And I got to Columbia and you know we and you know we were. We had dated before this for you know for for some time and so I I got there and I realized just how much I fell in love with the columbia as a place and obviously fell in love with her and so that ended up we ended up getting married about a year later. And you know when you’re living in a new country you you know you’ve got to figure it out right? There’s not that many options for you and I had I had done some studies in in spanish you know I so I studied spanish and portuguese and my undergrad which everyone thought that I would become you know a spanish teacher with that and. So when when I heard that feedback and I’m like you know what? no one will hire me to do anything because I don’t have any business background I don’t really have much work experience I’m 22 23 years old but I do not just speak english and I realize a lot of people want to learn english so I went ended up going to this trade show ah was ah for books.
Brian Requarth: And I found a business english book and I went and bought that book and that became this kind of syllabus and I literally knocked on doors on the main avenue in but with that Columbia just trying to pitch my my my classes so that was my first wasn’t my first first foray into entrepreneurship because I’d done. Many things as a kid you know like classic stories of you know, selling candy and I had a I taught swim lessons to to kids in my neighborhood I always had kind of a hustle and you know that was kind of part of my upbringing so I always had this entrepreneurial Dna from a very early age but the. Circumstances forced me to figure out how to make some money and so I did the only thing that I was able you know I knew how to do which was and I wasn’t a very good teacher in the beginning I realized that 1 thing is speaking the language. The second one is helping people understand how to you know how to develop the language skills and so I did that for a little while. And quickly realized I was a shitty teacher so I ended up hiring another teacher and that I would just go sell the classes and he would teach and that was how I financed the ah you know the beginning of my my journey as I kind of wanted to pursue my next opportunity and I think you know I can talk a little bit more about the evolution of what I did next but all of those. Opportunities usually come from just a pain that exists right and or an opportunity that you identify on your journey. So yeah, those were the first days the way I paid for my paid my way and and was able to continue and extend my stay into Columbia.
Alejandro Cremades: Nice now in your case you know there was say a really tough experience finding you know a real estate property. You know, which really you know was ah really um, a really big I would say diving board for you to jump. Into you know what will be the next opportunity that you had in front of you. So what?? what? What happened there.
Brian Requarth: Yeah I remember you know I was looking for a property and just to kind of date me here I pulled up the newspaper because that was the only place there was real information about real estate open up the classifieds contact to real estate agent that there was ah an ad. And I ended up meeting this real estate agent in ah in a cafe in Bowita and you know we sat down I explained what I was looking for told them that I was looking for. You know, an apartment in this kind of in this area and the agent proceeded to pull out a physical paper out of their briefcase. And they they slit it over the table and they said the property you’re looking for is on this on this list and so I thought great. Well let’s go. Let’s go take a look at you know some of these properties and they said no no, that’s going to be It was like ten or twenty Thousand Pesos which sounds like a lot of money to the international. Ah, listen it was it was about ten bucks or something at the time and so what happened is this agent was actually charging me to see information and I was in kind of a desperate place I’ll you know I’ll open up here on your podcast when I first got to Boita I was looking for the cheapest place that I could stay right. And in the us when you you’re looking for an inexpensive place. You go stay at a motel now in latin america a motel is something a little bit different than it is. It’s not a motel 6 in the us is not a motel in you know in Latin America it’s basically a place that you rent by the hour and so I actually checked in.
Brian Requarth: A shitty motel felt kind of like this something was weird about this place when I went and checked out after that I realized that that the price they gave me was by the hour because you know and and and so it was it was a it was a wake up call for me and then that. Basically planted a seed said. Okay I got figure out my shit here I got to get get it together and find a place to live and so you know fast forward I’m I’m sitting with this agent I’m a little bit desperate. You know I’ve got to I’ve got to find a place because I was in this in this crappy ah motel and.
Brian Requarth: You know that when they wanted to sell me the information I was kind of desperate. So I just paid them the money and when I sheved out the money and I got the list I so I spent the entire day looking at these properties first one too big second 1 already rented third one you know, not at a good location wasted my entire day. And that was a moment of frustration for me where I asked myself. There’s got to be a better way and so that was the I’d say the genesis of realizing the problem set that I wanted to go after because I’d suffered as a consumer.
Alejandro Cremades: So then what happened next.
Brian Requarth: You know, coincidentally I ended up finding a case study from Mercado Libra which was a Stanford case study and it was a kind of light bulb went off and and and I realized this is a huge business being built in Latin America and 1 of the values that they have is they have all this inventory in 1 place. It had a lot of kind of classified elements and so given that there was no place where I could see all the inventory it was. It was a seed that was planted. You know, let’s go out and try to aggregate all of these properties into one central marketplace. So I went out bootstrapped you know we we we we you know I skipped a lot of steps in the story but just for the the purpose because we could make this thing multiple hours but I had been building websites and doing translation services on the side. Um, you know, kind of post the the english classes.
Brian Requarth: And that was kind of financing my my life and I took some of that money and I started you know building you know with ah a co-founder which coincidentally is a funny story. You know I don’t know you know these co-founder stories how you meet you know it’s kind of like you know how do you meet? you know, ah your your wife or your husband you know. Pure serendipity but we were both over staying I had overstayed my visa in Colombia so I was at immigration paying a fine and he had had entered the country because he had the wrong stamp and so given that I had these english classes I had 1 student that wanted to learn german. And I saw his passport and it was it was a german passport and so that was how I ended up engaging with him turns out he had a background in technology. You know, building websites. It was is the early kind of early mid two thousand s. So anyways, that’s how we ended up kind of pairing up on this. And you know and me having had that experience looking for a property was kind of the the first I guess moment of realization or aha moment. That’s like oh this is a big opportunity. We should try to solve this problem and that’s when we came together on it.
Alejandro Cremades: So what ended up being the business model of vivare. How were you guys making money there too.
Brian Requarth: So the business was kind of ah initially a kind of a classified 2.0 where you know it’s so ridiculous to think back to this time you know sure your listeners are you know that? Maybe if if they’re a little younger. They’ll just be blown away but the way it works in the Classifieds is you would literally have to pay per word. And the classifieds because there’s limited space. So this is you know, enter the internet. It’s like there’s an unlimited amount of space. You can have a hundred photos. It’s you know it’s it’s it’s possible and so the way we made money and the kind of immediate innovation that we had is that all of our existing competitors. Had this kind of classified model where they would just charge per property to put your property on their website and 1 thing that I realized was and I thought about the value as a consumer the real value for me is show me every piece of inventory because that’s going to enable me to make a better decision and compare offers and so. There was a resistance and friction point that didn’t serve the consumer because they were charging really high price per listing and so agents had no incentive to upload all of their listings because they would have to pay more money and so we came into the market and we decided to offer kind of ah an all you can eat. Package if you will where it’s like fixed price. Give us all your inventory because we understood that once you got enough inventory you would hit an inflection point and you would you know, be able to give good. You know good information so we had a monthly fee that we would you know charge per per real estate company and they would list all their properties.
Brian Requarth: And then on the consumer side. You know it was very challenging in the beginning to try to get people to put their properties on because you have that chicken and egg problem. It’s like what comes first you know the properties or you know are the people searching for properties and we understood that we need to get more properties. So. In the beginning. We couldn’t convince anyone to put their properties on because they realized we didn’t have any properties so what we did was we actually um, you know we we did two things. The first thing we did and fast forward I should maybe make the the note that we ended up expanding the business to Brazil. Because when we we launched in multiple markets and then we just looked at the numbers in Brazil and it was just much larger and so we decided to you know narrow our focus and go aab all about Brazil so I had a co-founder another cofounder that I had met in Argentina and he was on the ground in Brazil and we were building the tech from Columbia. And I remember trying to get these first listings and Diego my cofounder he would send me a list of all the real estate companies and I would call call them in my broken portuguese that I’d learn you know from from the university and I would basically say hey I’m calling I want to speak with the owner. And they immediately thought this american guy probably wants to buy a property so he would write me a script and says when they say this say this when they say this say this and so I was able to get you know between my broken spanish portuguese and english the owner of the property online and then I would basically offer to put the properties online for free.
Brian Requarth: And so that was kind of how we first got the initial properties but we we didn’t have a huge smashing success because it was too slow and so the the next reflection we had was how can we just really automate this as much as we can and I’d rather ask for forgiveness than permission and so we ended up building a robot that went in and scraped all of the listings. And then injected those onto the website and then that was ah, kind of a turning point for us where we ended up providing you know a better resource for consumers because we had a lot more inventory. So Those were the early days of you know, getting that initial traction going.
Alejandro Cremades: And at what point do you guys realize I think we’re turning around a corner here I think we’re into something so.
Brian Requarth: I remember very clearly the kind of 2000. Um I think it was 2010. We might have to edit something out here I’m just recalling the the exact dates it was it was thing was June two thousand and ten and we had we had put these first properties on our on the website and then we we just let’s see how it goes we we started generating traffic. We started showing up in Google and I remember six months later about six seven months later in December December fifteenth my cofounder shows up to these offices. Because we had given them a six month free trial and we didn’t even literally had no data about how many leads we generated and there was just no information and you know they were doing it for free. So we kind of just showed up to their office blind hoping that we had generated value and I remember Diego. You know, walked in and said hey we’re we’re doing great right? It’s it’s a great service right? kind of just like took a big gulp and to our surprise both of the customers we met in the same day they were just over the moon about how amazing it was and that they wrote us a check on on the spot for the entire next year and so when Diego called me after the first meeting’s like hey we got you know $2500 you know in the bank prepaid for the year and then 2 hours later we got another $2500 in the bank. You know for for next year it was a $5000 day and it was the absolute confirmation that we were onto something because we just did the math.
Brian Requarth: And we’re like 40000 real estate brokers. You know across Brazil um, you know if we can get all their inventory and we can get them paying you know something every month we’re going to build quite a large business and so that was the aha moment where it was like okay, we’re onto something.
Alejandro Cremades: And in terms of capitalizing the business. You know, obviously different market and and you know the um the the Vc you know perhaps a segment was not as developed as as it is today. So how did you guys go about capitalizing the operation.
Brian Requarth: In the beginning the old fashioned way by just trying to get revenue because in in Brazil and in Latin America mind you, there was no venture ecosystem I think I could count all the vcs on one hand that’s literally where the the ecosystem was the time we started and you know I didn’t have a track record. You know I was a foreigner living in you know in Latin America wasn’t super networked. He didn’t go to Stanford and so in the beginning we just kind of bootstrapped and I ended up raising a little bit of friends and family money from you know, ah my college roommate who I got to give him a shout out. He you know he built a business when we were in college and he sold that business when he was 27 years old made a bunch of money. Ah he you know he knew me. We had lived together. He knew you know he knew I was kind of a crazy person that was going to figure this out and so he wrote me a pretty. Ah. Irresponsibly large check of two hundred and fifty thousand dollars um you know the very early days of the company and we scraped together some kind of family friends ah money and the the turning point for me from a capital standpoint I had another investor who was the Ceo of the of the. At the time the largest real estate marketplace business which was based in Australia a guy by the name of Simon Baker and Simon Baker had scaled this business called ah re a group and it was you know was a billion dollar business that he’d built and in the same kind of similar business model and so I had.
Brian Requarth: Cold messaged him you know and and I had I was I was sending everyone on Linkedin a message you know, very generic messages. Don’t do that if you’re listening to your founder. You know, write a well-crafted message show that you did some research first. But I finally it struck a chord and he responded to me. And I remember it was on Facebook and he he got back to me and I had said hey I see you’re gonna be speaking at a conference I’m gonna be at that conference in San Francisco you know of course I wasn’t I just said I’m I’m gonna be there and if he responded I would just go there I show up. We had a you know had we had 2 meetings and I remember. Distinctly you know this time we were just starting. It was very early and I I you know I met him at ah, a cafe and I pitched him the whole business I memorized a bunch of data about the market size and and we went into this this conversation and he was diligently taking notes the entire time. You know, kind of nodding you know, quiet, but just very very attentive and at the end he said so Brian what’s what’s the raise. How much are you looking to raise? What’s the valuation and again I took that big gulp of nervousness because it’s my first time fundraising and I as confidently as I could. Which probably wasn’t that confident at the time I said we’re we’re trying to raise $1000000 and I think I told them was a $6000000 valuation now this is in you know, late you know it’s like 2009 real estate crisis like you know the the real estate market is just explode. You know it’s it’s blowing up and I remember he looked at me.
Brian Requarth: Looked back at his notebook looked at me again and he said yeah I think this this meeting is probably over just shut me down and you know and and he kind of you know politely you know set his pleasantries and went on his way and like a very very rookie founder and first time fundraiser. Ajandra I literally called him like an hour later. He didn’t pick up the number the phone and I left him a message and I’m like hey maybe we could do 4000000 you know like just totally rookie did not know what I was doing what happened is he did not end up investing at that moment but I would send him a message every month we close century 21 we close this customer where we now got this traction and after about 2 years of completely harassing him. He ended up writing a you know? nice check into the business and more than the money it came with a incredible. Playbook and and helped us with a roadmap because as part of his cash I negotiated some advisory where he would come down to Latin America and spend time with us and the knowledge was extremely valuable so it was it truly was smart money and then the second order effect was that it provided credibility for us right. Because when you’re starting out who’s going to believe in you and and is this person are they credible and the credibility of building a billion dollar business in the same sector as us in another market. All of a sudden enabled me to bring on other investors and then things kind of.
Brian Requarth: You know tip from there.
Alejandro Cremades: How much did the? um obviously you went through a merger to prior to the acquisition. But the the whole entity prior to the acquisition from Ox how much you know what’s the total amount of money raised. Okay.
Brian Requarth: We raised about seventy seventy four million into the business and that was through multiple rounds of you know of you know fundraising we we raise a series c in 2014 so from first capital in you know, family friends.
Alejandro Cremades: And.
Brian Requarth: You know I was very early and I was just scraping by for a couple of years the first external capital from like a professional investor this guy Simon and and then a guy by the name of Greg Waldorf who was one of the first investors Inrulia that was in 2011? Um, and in fact, it’s ah it’s an interesting story because we were. Running on fumes in 2011, you know I I never taken a salary. It was June July 2011 and you know I remember just literally getting physically sick because we had June 2011 we had $87 in the bank. We had 20 employees and I didn’t know where man next dollar was going to come from. You know my my my roommate from college was financing. It. My dad was writing a you know six seven thousand dollars check a month and you know we’re in you know we’re in tough tough economic times in 2011, you know everyone was like I can’t keep keep this thing afloat. And so literally in the you know minutto nomenteos theego you know and and in then in the injury time. Um I I was able to get Simon you know to write I think he wrote a $300,000 check and just save the company and it was like the most.
Alejandro Cremades: Ah.
Brian Requarth: Just you know, just taxing thing as a founder to be able to you know, not know if you’re going to live and so when that wire came through I definitely did a dance.
Alejandro Cremades: That’s Amazing. No I Can’t imagine that was a hell of a events I’m sure now in terms of the um, you know because prior to the outcome with the Ox you know with that Acquisition. You actually did a merger so you combined Viva with with group of up. So What was the um. How was that merger and why why did you guys orchestrate it that way and then how did that lead you into the acquisition with olex as well.
Brian Requarth: So just to paint a picture for for you and the audience here I am we’re an attacker in an existing market where there’s incumbents the 2 primary incumbents and there was there was you know there was 10 players at 1 point right? It was very very crowded market. But there was 2 very well-funded players just to set the stage here. 1 of them was owned by Brazil’s largest media company and frankly, you know they they kind of own all the media in Brazil tv radio newspaper and so they had this massive megaphone and they had got an early start in their business and then the second player was a company that had been around you know 10 years prior to us ah backed by tiger global ah Riverwood capital so very well funded players and so we were we were the absolute underdog. Ah, this was you know this was you know? Ah, it was a long shot if you were to look at it if you were to stop and take inventory of where we were when we started and then you know who we are going up against it was it was a complete David and Goliath story and when we you know when we looked at the market. There was 1 thing this one insight that I had and there was. I remember hearing this quote from a friend of mine. He said if you’re not at the table. You’re probably on the menu and I just love that because you know I felt like we were either going to get swallowed up or we’re going to have to you know you know do some do some.
Brian Requarth: You know some some some work here and so at a very kind of early entry into the market despite having you know this massive gap in revenue and marketing budget and everything else I knew that we would need to to carve out a position and then. And then try to you know the industrial logic of consolidating this business ah was very clear to me because you look around the world. You know you look at Spain you know with yeah leasta and and you know you know those players you look at Australia you know you look at Germany and the market leader that consolidates. The margins for the market leader are extremely healthy. You know we’re talking fifty sixty percent ebadda margins and the second player is you know fifteen twenty percent and then the third player is just nothing right? and so you don’t want to be the nothing player and so you know I had actually approached. Ah, the the market leader at the time when we were very small I had I remember a conversation with Mickey Malka who’s legendary fintech investor at Ribbbit Capital and he was an angel investor in my company and he said brand. You think you could you think you could buy them and at the time they were literally 10 times larger than us. So it was just. Complete just irrational thinking in my mind and but it planted a seed in me and and thought you know what we’re Goingnna. We’re going to eventually buy these. You know this company and so you know we and ended up closing the gap over multiple years. Um, the great thing about not having resources is you get really smart.
Brian Requarth: You get very scrappy and meanwhile our competitors were you know, raised tens of millions of dollars before this and we had you know, raised. Ah you know a measly you know million dollars in our in our seed in a series a of 3000000 so we had not raised a lot of capital until later on in the business. But what I what I realized is that we could be very scrappy and instead of buy a bunch of media. We just mastered the art of Seo. So we we reverse engineered everything that zillow and trulio were doing in the us we we looked around the world and we essentially just out executed. Everybody. From the standpoint of customer acquisition. We’re able to drive traffic at a much lower cost which then enabled us to offer our product at a lower cost which then enabled us to get more inventory and kind of the network effects of having more inventory getting more traffic and journeying more leads enabled us to carve off a really strong position. And each quarter we are closing the gap on our competitors. It was you know this this this ten x gap became a five x gap became a two x gap became. We’re down by 30% gap and so the trajectory of our business by the time we ended up doing the merger. Ah, was that we were you know the market leader in traffic. Ah we were probably a third rising the second in revenue so we were closing the revenue gap and you know that that was a moment where um, you know we we realized that you know we should. We should make a move and so I rekindled those initial.
Brian Requarth: Attempts at trying to ah you know acquire a business. Um that it that had probably been laughed out of the room when that first that first conversation and to my surprise actually in Spain I was at a conference and in in Madrib and the the Ceo of the other company said hey do you? you mind if we talk. And he’s like I was kind of thinking about that conversation. You know that we we had in the past and you know let’s let’s evaluate and so it was a fascinating thing I flew back from madrid back to San Francisco and you know I ended up having a call with the Ceo where we did this really really cool, kind of like exchange. Where we said okay q one you know 2016? What was your numbers 2 guys and we walked through like 3 years two or three years of data and we just shared our numbers every every quarter and and so we just laid it out on the table and then at that point it was just a negotiation of you know equity swap and so we ended up. Almost doing a fifty fifty um you know we had a little bit less but I was willing to give up a little bit of equity for control and so we ended up. Um you know, putting in our Ceo which was you know my partner at the time Lucas Vargas and and we you know kind of control the operations and the management team. And so that was that was how it all happened and and you know it turned out to be a good deal because we were able to sell it to Olx you know there a few years afterwards and and turn that thing into what was equity value into to real cash. It was two point Nine Billion Ray ice and so.
Alejandro Cremades: And what was the amount of that transaction when ended up being.
Brian Requarth: When we actually signed the deal. This is emerging market fund. It was like 740000000 ah you know usd and we learned a lesson where you we want to lock your transaction into in dollars and it was in Ray ice and so by the time we signed it and you know.
Alejandro Cremades: Yeah.
Brian Requarth: All of the um you know the diligence and the ah you know the the antitrust review ah, by the time we were ready to close that dwindled down to kind of sub right around 600000000 so we lost about $150000000 in in exchange over that that time period. Um, and so yeah, it landed right around 600000000? Um, but it was a two point nine billion dollars billion hey ice transaction
Alejandro Cremades: Wow! So how long did it take from the moment that you guys were thinking about you know, perhaps doing olx to the moment that it was that it was closed.
Brian Requarth: Yeah, so our first conversations if I can recall with o Alex it was a lot of it was there was a lot of dancing going around. Um there. It was I would say about a year until we kind of nailed down the terms of it. And then another six months to kind of finalize the transaction so it was it was a good eighteen month um process I’d say and it was very It was very very very hectic because at that time to provide a little bit more color we had just executed this merger and.
Alejandro Cremades: Got it.
Brian Requarth: This merger was very hard because you take to you know it’s like you’re merging real madrid in Barcelona right? Like like there’s are two competitors. they they kind of you know been going at it you know and there was a lot of redundancy on the team right? You know like who’s going to who’s going to play what position and. You know we were probably both overstaffed because we had been you know racing and and growing and so we both had about 600 people. You know I think it was 1100 total and so we ended up having to let about 400 people go 450 people go and you can imagine how that affects the you know the revenue. How do you extract the value from both platforms and so we we had been growing very consistently over that you know the last kind of 3 4 years and wasn’t until post-merged that we had our first kind of flat and even a negative quarter just as we were kind of trying to consolidate value and right around that time. You may recall but softbank just happens to pop in Latin America and say oh we’ve got this truckload of money that we’re about to dump on the market and I remember basically getting the impression that they were wanting to invest about two hundred and fifty million dollars in one of the players and we didn’t really. We weren’t really looking for money we were looking to build more a more profitable business but we also didn’t want our competitors collecting that two hundred and fifty million dollars because that would you know strengthen our the the competitive landscape and so we went out and kind of ran it through a process. Um, you know I had. Ah.
Brian Requarth: Lots of talks with the Softbank team and and other but given that the growth trajectory was not as exciting at the time because we were going through this merger and we were seen as kind of the incumbent at that point that of the classifieds play. So we ended up trying to balance the ah fundraising with a you know with a transaction. And ultimately olx you know made ah a fairly good offer and we decided to to to exit the business which I think was probably the right thing timing wise we might have waited for another year and probably you know, been in a better position because 2021 was quite a you know, quite quite a boom year but you you can’t look back and and. You know, try to optimize in in in retrospect.
Alejandro Cremades: Now Obviously you know incredible outcome. Um, you know unbelievable journey with with with Viva real and then group of up and then the acquisition with with O legs Now you know what you’re doing is is. It’s super exciting too. So So tell us about what you’re up to with latitude.
Brian Requarth: Alejandro you you know this firsthand it is so painful. It is so lonely to be a founder and it’s just so damn hard and so when I you know I went through many ah metamorposes as a founder. Many sleepless nights you know blood sweat and tears and when I when I think about my journey you know I when I was waiting for antitrust to to approve our deal I had no control over the process right? because here I am you know just waiting for the government to figure this out and so. In order to distract myself what I ended up doing was I just put my my energy out there and I said if you’re an early stage founder in la am I’ve been building in the region for over a decade I’ve made every mistake in the book hit me up all I’ll help you out and so this is you know the summer of 2020 and I ended up having. Ah, hundred and fifty zoom calls over that summer with early stage founders and some were getting you know had term sheets pulled some were you know worried about the the you know the future of what was going to happen. Some were just starting and in those calls there’s 2 things that jumped out of me 1 the incredible talent and ambition of this vintage of new founders compared to when I started and then secondly despite this very sophisticated operating capacity vision. You know execution.
Brian Requarth: There was still a massive gap in understanding some very fundamental things that I picked up along the way of my journey and so what we did was we you know I partnered with Yuri Dentalchenko and Gina Gothi yuris the Cto Gina’s a co both have career and you know in scaling and and tech. Um, you know in Latin America in the us and you know we started putting our heads together. It’s how can we reduce friction for these founders. How can we help this next generation founders because there’s 1 thing that we know that entrepreneurship is one of the major one of the most powerful levers. For economic progress and social mobility and we’re a big believer in the region. We’ve been living in the region for a long time and so we kind of put our heads together and we started you know, creating resources for founders. We started hosting these live sessions on everything from you know how to how to risk capital to. You know how to build a product and engineering team to how to use Pr for growth and to our surprise you know we we talked to a lot of founders that were just loving what we were doing and they were feeling really appreciative and we had this real give first mentality we generate value for these these folks and so that kind of evolved. Organically into a cohort-based system. So we we ended up having our first cohort cohort 0 it was about 40 founders and we you know we brought on a few different speakers. We had you know q and as we had you know mentor sessions and.
Brian Requarth: You know the founders also connected with each other so we kind of manufactured this serendipity and we realized we were on to something and so we replicated that and we kind of institutionalized that and organized that and so we built this cohort based you know, call it an education system. You know, kind of a community and so far we’ve had about 1500 founders go through our program the last two years they’ve collectively raised $800,000,000 in Venture Capital and these are preceded seat founders that have gone on to raise you know significant you know rounds from there and you know we did this equity free. We did equity free because we didn’t want adverse selection. And we want to be very best founders to want to be part of it. So um, we’ve we’ve drawn on some of the best founders and then what happened is after we built this kind of community and I’m a big believer in building community I think community is the new lean startup first you build the community then you listen to the community. And then you solve problems for the community. So the the fast follow on this. Ah, besides the investing that I was already doing as an angel for the last kind of you know, call it 5 6 7 years um you know when I had some liquidity of vi varro besides the money I realized that there’s just so much stuff that gets in the way. For you to to scale your company I mean your disadvantaged in Latin America from the start if you want to spin up a company. You know you’ve got to you’re going to either make the the same mistake I made because I was ill-informed and it wasn’t popular back then but I created a ccorp for a company and this ccorp.
Brian Requarth: Resulted in us paying over $ $100000000 in capital gains taxes in the us despite having 0 operating in the us and so I learned the hard way that you’ve got to have the right corpus structure and so after talking to all these founders and having me spun up a bunch of companies and invested in other companies I realized that. All of the venture funds were investing in a cay and holding company as the the primary you know, ah you know mechanism for receiving capital from venture and and given that I had just spun up a company and and paid thirty five forty fifty thousand dollars to have this. More complex structure to receive venture capital it really annoyed me as a founder you know, just such a mundane. Ah, you know, just kind of frivolous activity to to learn how to to navigate these waters so we ended up automating this company formation process to spin up a cayman holding company. Ah, delawarell will see and a local operating company. So that founders can be venture ready and so we we say founders you know 5 x on their you know on their formation and we make sure that’s set up so that venture funds you know are are kind of ready to to put the capital in so that is the first series of products. The vision. Is to become the platform or the operating system for venture backed companies in Latin America so I’m going to stop and pause there because I named two things the community the products and then the last thing is the fund and capital is the the last remaining component to the.
Brian Requarth: You know the the gap that we want to fill so we have a fund as well.
Alejandro Cremades: Well well obviously you know life you know it’s all about the intersection between people and capital. So um I think that nothing like creating ecosystem and and obviously you know what you’re doing there is going to allow to do that which is very much needed. So I guess the question here you know to to. Finalize in our time together is you know if you had the opportunity of getting into a time machine and going back in time and being able to have a chat with your younger self. You know maybe is that the you know be younger Brian that is now. Ah. English teacher and figuring out. You know the business side and if you had the opportunity of having us sit down with that younger self and being able to give that younger self one piece of advice before launching a business. What would that be and why given what you know now.
Brian Requarth: It’s a great question and what comes the mind immediately and I’ll try not to censor my thoughts that make it sound more. You know a certain way and just try to be super authentic in my response I mean I think that going back to something that I said about how lonely and how difficult the journey is. I think that the amount of just suffering that I probably put myself through of just you know the the sleepless nights and the just the the size of the concern that I had when things weren’t working I think that. When you’re able to think long-term and I have the benefit of of hindsight now that I’m building a new company and you’re able to think in decades rather than quarters. Of course you need a sense of urgency to get things done because nothing happens without just massive sense of urgency and hustle. But I think that. Taking a longer view and and being able to kind of think about things you know from ah a longer time period provides massive benefits to you um, because the problems are never as big as you think the moments of achievement are never quite as important as you think it’s somewhere in the middle. And I think being able to calm myself down I mean look at you know this is a bit of a taboo subject but you know I mean I had you know more than 1 panic attack running my company you know and you know in one of those cases I ended up in the hospital because I thought I was having a heart attack and I think that.
Brian Requarth: You know that’s 1 thing that is the mental health piece. We could have our whole conversation on that and I cover a little bit of that in my book of Eva the entrepreneur which you know I broke it into 3 sections. 1 is like the personal like how to deal with the personal stuff. Ah, the second one is the business and the operations and the third one is the kind of. Ah, external funding and and you know, kind of board etc and when I when I think about this you know I’m I’m way more zen than I used to be um and and but by no means I would never describe myself as zen as a person because I’m very high energy. You can probably hear it when you hear me talking I’m i’m. So we’re passionate about what I’m saying but at the same time perspective is amazing when you when you know and you’ve been through it and you realize that like okay you know there’s there’s light at the other tunnel I know it. It’s not a train It’s not going to come smash me over and you were able to maintain that kind of optimism. And knowing that you know there’s going to be a brighter day when you’re in the middle of the storm I think that that ah would save me incredible amounts of just being distraught and you know, kind of my my you know my my the feeling of not knowing. And and being concerned and and and filled filled with self- Doubtubt. So I think all of those things I have the massive privilege privilege on the second time you know this this new journey to be able to take a little bit of that wisdom and and be a little bit more confident myself be able to embrace the fact that like yeah, it’s gonna suck. But.
Brian Requarth: Learn to love it and you’ll get through it and just you know, stay optimistic about it and so that would be my advice to we would be you know chill the fuck out a little bit and and you know and just take a couple deep breaths and it’s probably not as bad as you think.
Alejandro Cremades: I love it so Brian for the people that are listening that would want to reach out and say hi. What is the best way for them to do so.
Brian Requarth: You can hit me up on Twitter at Brian Reckworth if you send me a message on Linkedin just make sure to reference the dealmaker’s podcast because otherwise it’ll be 1 of the 1000 people that spam me on Linkedin. Um. And you know don’t don’t be that guy where that I was when I was trying to raise capital sending generic messages. Um, and yeah I mean follow along I’ve actually got a podcast too. It’s called latitude podcast. So if there’s anyone interesting. You know anyone listening interested in lat am it’s ah it’s a great resource for founders investors. You know we interviewed the top founders so I’m not quite at the dealmakerrss level yet. But we’re we’re working on it and listen Alejandro I think it’s amazing. What you’ve been doing. Ah you know there’s a lot of parallels with with latitude and so I’m sure that there’s you know c incredibledible opportunities for us to collaborate and. You know, share share knowledge. And in fact, that is the center point of what latitude is about it’s about building ecosystems building value you know and and trying to elevate the next generation of entrepreneurs and for me and particularly in latin am Sowa Kericossa is tama a laard in. Okay.
Alejandro Cremades: I love it I love it little Brian thank you so much for being on the dealmakerr show today. It has been on honor to have you with us.
Brian Requarth: Thanks! Thanks! A lot for the interview. It’s great chat take care.
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