Upvest, the Securities API, was founded by Martin in 2017. We spoke to him about his journey so far.
The ambition was to build the tooling around new blockchain technology.
After university, I started working in finance in a private equity fund and went through the traditional career ladder: intern, analyst, associate, investment manager, and finally operating partner. We invested in some fantastic businesses across Germany and the Benelux. For me, it was fascinating to see how these entrepreneurs, with huge ambitions, had grown their businesses and hired all these great people. I was always on the other side, having to challenge them, ask lots of questions and be diligent, but I was still excited by what they were doing.
There was a point where the investor sent me to a business where I had to, for example, optimize cash flow. During that time, I became very close to the founders, and they ended up asking if I’d join them as their CFO. I was only 25 or 26 at the time, so very young. I was astonished because I was more like the ‘data monkey’ or the ‘PowerPoint monkey,’ so I wondered why they wanted me for this role.
I started thinking about it and worked closely with the portfolio company and then ultimately decided that, at some point, I wanted to start my own company. I wanted to create my environment, and I wanted to change the world in general. This first company was a complete disaster because I was a ‘PowerPoint and numbers monkey,’ and my ability to deal with people and build products was not as strong as it is now. But over time, I learned how to start a business, and I had a successful payments company with a couple of friends in Germany and the US. Then the company sold to Klarna, and then I came back from the US to Germany.
After ten years of working in the finance industry, I founded Upvest in 2017. I’d seen that the whole financial markets moved towards technology, so it was all about speed, cost, savings, and getting an edge with big data.
Between 2016-2017, blockchain started with ICOs (initial coin offerings), but there were also Bitcoin investments. It was the first time I’d seen many developers get excited about the financial markets. For me, this was like a paradigm shift in finance because very ‘salesy’ investment bankers did not drive it, but rather developers who wanted to create technology to make the world a better place by sharing the economy and providing new opportunities for financial markets. This inspired me to start Upvest; the ambition was to build the tooling around this new blockchain technology safely and securely for financial market participants.
The vision is still the same: to make any assets tradable for anyone around the globe. While this is still the same vision, the route to it has changed dramatically. Initially, we started with providing these investment opportunities into cryptocurrencies, but now we’ve seen that this technology is also pretty powerful for traditional securities. Consequently, we’ve rapidly expanded in this direction during the last 12-18 months.
Hiring exceptional people has been a learning curve.
One of the most impactful things you can do is hire someone early on; however, at the beginning of your journey, you do have some time and cash constraints. Therefore, when you’re at the seed stage, you won’t necessarily get the best pick of people as you can’t afford to pay them. You have to do a lot of stuff yourself, but after our Series A, with Notion, we finally had the budget to get ‘triple-A players’ (as we call them internally), and for me, this was game-changing for the business. When you get these people in, there are many things you don’t have to worry about anymore, as they take complete ownership of – and have the experience to executive – certain areas. That’s been one of the critical lessons for me as an entrepreneur. We’ve worked closely with Notion throughout, and this has probably had the most significant impact on our growth and allowed us to hire great people.
As a founder, you always have to push the boundaries.
Things have, of course, changed throughout the last three years, but there have been some common challenges. One of the difficulties was people, so getting the best people and helping them grow. There’s always a challenge there because it’s the people who execute on the business. At the moment, we’re a team of 25 but are hopeful that our team will grow to 40-50 people by the end of next year. We’re moving at a pretty fast pace, so we need to prioritize what we need and get the right people, then keep those people motivated and help them grow. It’s always a challenge, but I love this challenge because I love working with people.
Another challenge is that, as a founder, you always have to push the boundaries. So, even when you think that you’ve found the right product-market fit and that you can entirely execute and have a repetitive business model figured, you figure out (especially in our market) that there are many more opportunities. This means it’s a balance between staying focused and executing and extending your market into a tremendous opportunity. This has always been a challenge for me because we could’ve stuck with the product we had one-two years ago, but it probably wouldn’t have had the potential to become a unicorn or even a decacorn company. Our ambition is to really change something in the world and then provide economic opportunities for all. To achieve this, I think we have to stretch and push the boundaries. This puts tons of pressure on the organisation, which is a further reason you have to hire the very best people early on, and they have to be very ambitious.
So, the two biggest challenges are getting the right people (the most significant challenge) and having the right focus at the right time.
The people on the journey with you are indispensable.
Without all the people on the journey alongside me, we wouldn’t be where we are right now, and we wouldn’t achieve growth.
Whatever you do becomes an almost ‘de facto’ culture.
The biggest surprise was related to me. When you’re a founder, everything you do, to a certain extent, gets reflected onto the business – I was not aware of this when I started the company and had always thought it was more distributed across the organisation. I was still surprised when, even with enormous organisations such as Apple and Steve Jobs, they can depend on one person or a couple of the founders. It’s similar in our organisation because, with whatever you do, it becomes this almost ‘de facto’ culture, because people will look at you and what you’re doing. They’ll mirror your style of ambition, your style of working. This was all a surprise to me because I thought the business becomes like a self living organism; on the one hand, it’s pretty independent of the founder, but on the other hand, it’s not at all. Everyone still has touchpoints with me as a founder, and I think it will be that way for the next couple of years.
Successful people doing something that they love is what inspires me.
I admire a couple of people because of what they have done, but I am most excited by successful people who do something that works and that they love. They’ve found their missions and their purpose, so they’re working towards that. But it’s great when, in parallel to that, they’re able to stay human and balance a stable personal life. For example, I admire Barack Obama; he had a clear purpose and mission he was working towards (and did this very successfully), but he maintained a healthy family life. He has a private life with his friends and manages to keep up with his sports, which I think is impressive. There seems to be zero toxicity about him, which I think is important because, unfortunately, you do see many successful people who become toxic over time. Of course, Trump could be an example of that, but so could some other successful, well-known entrepreneurs. For some, they will start engaging in a bit of a dodgier lifestyle, whether it’s taking drugs or cheating on their partner… whenever I read about such things, I can’t get inspired by these people. I feel that they’ve stretched the boundaries too much, and I doubt they go to bed every night feeling content – in fact, they’re probably very stressed.
If you could go back to when you were first starting, what would you say to yourself?
Enjoy the journey more! It’s essential to realise what you have achieved and appreciate this. It’s also super important to show this to your colleagues because we worked incredibly hard during the first two years – we still do, but it’s essential to make sure you enjoy this journey while you’re on it.
It’s also essential to have a very clear mindset as to why you’re starting your business. I think you can make many assumptions as to why you’re doing this, but it’s important to know exactly what you want out of a company early on. I think we probably experimented with the business a little too much in the first couple of years because I didn’t have that clear mindset.
Notion is pretty unique.
I got approached by one of the teams at Notion, I believe through Holtzbrinck Ventures. We had a chat, and Notion got excited about Upvest, mostly because we were at quite an early stage. Notion didn’t want to invest at the first touchpoint as we were a bit too early, but about half a year later, it was a good fit. Notion is pretty unique compared to the other VCs we have (and we have quite a few investors in our cap table). Notion is incredibly focused, especially when preparing the board documentation. I mostly check in with Patrick there, and he’s always super helpful because he boils down to the essential things that we have to get right. I love this because he pushes the boundaries while helping us to focus. I haven’t seen any other investors so far with this same focus.
If you start something massive, you have to take VC funding because you can grow faster.
Many entrepreneurs want to bootstrap the whole business, but if you’re going to change something and do something fundamental, you need the money. VC money is probably the easiest way to get a lot of money fast.
It would be best to find a VC with the same values and speak the same language as you. Some VCs out there are aggressive, but they’re not close to the founders. They’re very numerical, and they push and push and push because they want to see the results. This works for some people because some entrepreneurs are also very pushy.
On the flip side, other VCs understand the bigger picture and are more founder-friendly. They know that you have to find the right people, allowing those people to grow.
To summarise, there are two types of very different VCs, so you need to understand what kind of person you are to find a great fit.