#1 - Venture capital today and lessons from Mercado Libre: Nicolas Szekasy, Kaszek Ventures

**Brian Requarth** (0:04)
Mercado Livre was founded in Argentina in 1999, and still is, to this day, one of the most successful entrepreneurship stories in Latin America and the world. Our guest in this episode, Nico Szekasy, joined co-founders Marcos Galperin and Hernan Caza at the very beginning as CFO. The company faced a number of challenges during the 2001.com bubble and the Great Recession in 2008 Nico took the company public in 2007, putting them in a great position to weather the storm that would soon follow.
A few years later, Nico and Hernan left Mercado Livre and started Kaszek Ventures, a venture capital firm that helps outstanding entrepreneurs build high impact technology-based businesses in Latin America. When Kaszek invested in Vivaral, Nico joined our board. I remember feeling intimidated at our first board meeting as I didn't have a finance leader at the time. There I was presenting a financial forecast to the guy who took Mercado Livre public on the NASDAQ. I stayed up all night working on it, but I knew the model wasn't any good and I was worried about looking like an idiot. However, Nico has always been supportive, transparent, and he's always had really smart advice. Today, he shares his thoughts with us, a bit of his journey and his views on raising capital, especially in times like these. My name is Brian Requarth and this is Latitud Podcast.
So, for the uninitiated, Nico, what does Lake Como mean?

**Nicolas Szekasy** (1:34)
We talked about that a long, long time ago.
We were going to the eBay meetings because eBay had become an investor in Mercado Livre, and part of the agreement was that we could go to some of their internal ops reviews and strategic reviews and participate as if we were a subsidiary of eBay. So Marcos, Hernán and I used to go to San José very often. It was good to see the frugality of the culture at eBay was a very successful company. It was a profitable company, but you could still see that it was very austere and that it had a culture where they were building something relevant and growing their business and the revenues, but still very conscious about their costs.
They were so successful that one day they decided that they had to reward themselves and the next ops review would be happening for the first time, not in their offices in San Jose, California, but in Lago di Como in the north of Italy, close to Milan. So we were invited, we went to that event, it was great, we really enjoyed it, but it was at that time when probably eBay had peaked and Amazon was coming from behind, but really challenging them and eBay was starting to feel pressure on their revenues and on their business in their core markets in the US and Germany. So it was just maybe a coincidence, but we used to think about the Lago di Como, the Lake Como moment when maybe a company is not so frugal anymore and maybe there's a belief that we have already made it and therefore we can reward ourselves. I think it had nothing to do with changing culture at eBay. It was really a coincidence, but we used that anecdote as something internally. At Mali, the Lago di Como moment, you never want to get to a point where you think that you have already made it or that you have to be celebrating your success, because every day you go back to the trenches and to the battlefield. So I don't know if this is clear enough, but it was like a symbol to a certain degree that this never ends and you always have to be paranoid and you always have to continue fighting because there's always new challenges, new competitors.
You were the disruptor, but maybe if you become complacent, somebody will come after you and will eat your lunch and will disrupt you. So the message that we use this metaphor internally at Meli for was never be complacent. You always have to be alert. You always have to be looking forward. You always have to be constructing, building, developing, doing, executing and so on and so forth.

**Brian Requarth** (4:52)
Yeah.
What I like about it is there's a very symbolic idea. It's easy to see this beautiful place and it does a good job of illustrating it became like the Lago di Como became like an inflection point.

**Nicolas Szekasy** (5:06)
And again, I think it was a coincidence.
And it was not that the I don't think that even had become complacent. It became a coincidence, but we used the symbolic value or the metaphorical value of that because in any space, but particularly in technology, things move so fast that there will always be three kids in a garage that are looking at you as the target in the same way that you were looking at others as the incumbents or the complacent more old fashioned type of players. So you need to ensure that you instill in a company this culture of constantly reinventing your model and your strategies and your tactics.