Serial entrepreneur, business angel with hands-on attitude, founder & godfather of EstBAN Ivar Siimar sharing his thoughts. Ivar was interviewed by Tarmo Virki, editor in Forbes Estonia magazine before summer season.
How did you end up investing in Click & Grow?
When we first heard of electronic flowerpots, we laughed and said “No, we are not interested”, but then we got another call and we decided to meet the team. The story sounded interesting, we saw Mattias Lepp as an inspiring leader and thus we decided to invest.
How difficult is it to sell a physical product out of Estonia?
It is extremely challenging. On the one hand we don’t have factories in Estonia, which would be ready to make test production runs. Our factories are doing subcontracting and these processes do not fit test-runs. We also lack experienced industrial designers in Estonia. On top of that we are also far away from our markets.
Click and Grow raised $625,000 on Kickstarter in spring for a new series of flowerpots. Why did you decide to use Kickstarter?
When someone actually pays you it is worth so much more than a “like”. Our first product had 26,000 likes but out of those less than 1 percent were ready to buy the product. We learned our lesson. We have local alternatives to Kickstarter, but the sums raised there are just a fraction of what you can raise on Kickstarter.
You have been one of the kickstarters of organised angel investing in Estonia – where are we today?
EstBAN has been working for almost half a year now, the first investment based on our data has also been made. It was not syndicated, but the investor is happy and I hope also the entrepreneur. I think the syndication is the key here. We don’t have too much startup investment experience in Estonia. We have a lot of interested members who do not dare to be the lead investors. We are aiming for around 60 members this year. I think the moment of truth will come when the invoices with membership fees will be sent out next year:) What we are really doing at the moment, is to wait for the first deals to speak about – investing is really about the deals and until these are done we have very little reason to be going public.
Do we have a startup bubble?
We have hype in the media about angels and startups. There’s hype, but no bubble. It would be a bubble only if a lot of money would be going into the market, and that’s not the case. We have market gap to fill in with EstBAN.
How are we doing compared to our Latvian and Lithuanian neighbours?
There are no organised angel movement yet (!) in either. In the whole of Europe the angel movement is just 5-7 years old. I have only now understood that Lithuania really has a manufacturing industry in place, so if the startup is involved in something which needs manufacturing skills they may want to look at the Lithuanian market for partners and possibly also for investment.
To Lithuania? Are you serious? Even Latvian culture already seems so far away.
I agree. However, we are in serious talks with a few Latvian companies to invest into. We’ll see.
Any tips for companies meeting Estonian investors in an elevator?
We don’t have high buildings, so in 7 floors or 2 sentences you would need to make yourself interesting – however you do it! And do it!