The global pandemic continues to have a negative impact on many different industries. One of the hardest hit sectors is the events and conference business. In the beginning of April, we published an article about how the Coronavirus crisis impacts startup & technology events in Europe. Unfortunately, not a lot has changed since then, and large indoor gatherings are still not possible again in most European countries.
To discuss this topic in a bit more detail, we just interviewed Web Summit’s CEO and co-founder Paddy Cosgrave, organiser of one of the world’s largest tech events. The Irish entrepreneur grew Web Summit from a small and rather local/national event to a giant tech festival with over 70,000 attendees from across the world. Today, the Web Summit team also organises other big events like like Collision, RISE and MoneyConf.
Also, we interviewed Sean Curtin, the Head of Startups at Web Summit. He and his team in Dublin and Lisbon have gathered some of the most promising next wave startups from across the globe to showcase at Web Summit, many of which become household names in tech, such as Uber, Revolut, OnePlus, and Plaid. Over the years, Sean and his team have built relationships with thousands of founders in the startup ecosystem, and connect them with top VCs looking to invest. In 2019, the team gathered a record number of 4,000 startups across Web Summit events.
Part I: Interview with Paddy Cosgrave, co-founder and CEO of Web Summit
Firstly, we’ll start with the obvious and your plans for Web Summit this November 2020. Will it be going ahead and, if it will, how have you adapted to the current pandemic? What can attendees expect from this year’s Web Summit?
We had to move our North American event, Collision, online. In June, we welcomed 32,000 attendees from more than 140 countries entirely online, for three days on software we built out in just three months. That was basically our demo day, so there was a lot of pressure. Each attendee, startup founder, investor, media representative and partner got the chance to make meaningful connections on the app with people from over 140 countries. People want the opportunity to meet peers, leaders and speakers, and the software we’ve built enables these connections. We’ve seen that now at Collision from Home.
We’re going to scale this significantly for Web Summit. We’ll host up to 100,000 founders, partners and speakers online and offline. For now, the format of Web Summit in Lisbon will likely be decided in early October. Whatever decision is made will strictly adhere to Portugal’s health protocols for events at that time.
Since Web Summit is fully focused on the event business, how do you see the Coronavirus crisis impacting your company in the next 1-2 years? Do you see a serious threat for your business model as a whole?
For us, moving the event online was easy. It’s always been the case that we are maybe the only large event company that builds our own software. For nearly half a decade, a team of 50+ engineers, product managers and designers have built software to make our events a lot more productive. We’ve seen at Collision from Home how our platform enables people from all over the world to make meaningful connections akin to those made in the real world.
Speakers are the icing on the cake of conferences, but networking is the true reason people go to events. We know from our own survey data that the majority of attendees who initially say they come to see speakers tell us afterwards that the biggest benefit turned out to be networking, whether that change came from the excitement of personally meeting interesting people, or from going in with very clear business objectives.
Our business model is adaptable. When it comes to replicating a business conference online, streaming content is not a challenge. Nowadays. you can use any modern tools for free. The harder part is replicating the networking in some meaningful way. We’ve focused on that for a long time, so creating a place where attendees can network in a meaningful way and extract some value is, just by chance, not that hard for us. It’s what we’ve been working towards for years.
In edge cases, we’ve noticed over the years that some attendees from countries like New Zealand and Azerbaijan have bought tickets, but have not been able to travel last minute for whatever reason. They just download the app, watch the talks online and chat to everyone on the app. The app makes you powerful.
Now our runway time has been significantly cut. What we were already planning to deliver to attendees in late 2021 has been delivered for Collision from Home and will be scaled out to nearly three times the size for Web Summit in December.
Large gatherings may not be feasible for another 18 months. What is your take on online events v. offline events? Do you think we’ll see a fundamental shift over the coming years from hosting and visiting large international gatherings to hosting/visiting online events?
Quite honestly, I don’t think you’ll ever replace face-to-face interactions. Software is very powerful, but I don’t think any amount of software will replace the magic of true face-to-face contact.
You can’t replicate what’s happening in the offline world. Spotify reinvented consuming music online, but they didn’t replicate a music store experience. They’ve created an entirely new way to consume music in a pretty satisfying way. So when it comes to conferences, maximising meaningful connections is not about replicating every feature – like meeting booths or roundtables – that we have at the physical events. We’re reimagining what a conference is online.
Can you find the right people who should be talking to each other? Because everyone’s time is finite and there is a cost to finding people. If an attendee is looking for a developer to hire, we have to make that more efficient for them. Our software is powered to generate the recommendations that are most valuable to you.
Enabling in-app videos is quite trivial. People are trying to figure out the bigger challenges – those watercooler moments, hanging out at 10 o’clock at night in the hotel lobby where all the speakers are staying, as they’re streaming back in after their dinners, queueing for food… All of these serendipitous moments. Enabling that magic. That’s the serendipity of conferences that make them magical and quite irreplaceable. Can you engineer that in some way? That’s what we’ve been trying to achieve.
You have grown Web Summit so quickly from a 150-person event in Dublin to a 70,000-person event in Lisbon. What can you attribute to your success, and could you turn that into some growth tips for aspiring founders?
Web Summit has grown very, very fast. We’ve also been bootstrapped since we started 10 years ago this autumn. It grew from a conference that only Irish people came to back in 2010 to one that sees 70,000 attendees flying in from 170 countries.
We’ve been able to physically grow the event after we moved from Dublin to Lisbon in 2016 – giving us space to gather 70,000 people –but we haven’t jeopardised the experience of the event as we’ve scaled.
Scaling can be very messy. The software we’ve built has been key to keeping it organised and productive for attendees. You only have three days at the event to make meaningful connections for you and your business. We’ve been able to use recommender systems and complex network systems that can suggest the best attendees for you to meet – those who you don’t know, but should know. We can direct you to the right talks, investors, founders and journalists. Everyone needs to download the app, even the likes of Tony Blair, so you have access to message anyone directly, and we have data to show the amount of meaningful conversations on the app has grown each year.
Part II: Interview with Sean Curtin, Head of startups at Web Summit, RISE, Collision & MoneyConf
Using insights from your Web Summit networking app, do you have any advice for the founders who will be doing most of their networking online for the next few months?
Firstly, it’s now more cost-effective for founders to join online events and meet investors they otherwise wouldn’t. The most expensive part of going to conferences for startups is not the ticket but the travel and the accommodation. For bootstrapped startups, that can be about a four-week runway. Online events now provide an opportunity to connect with people who can have a serious impact on a founder’s business, and it doesn’t cost them the many thousands of dollars that, traditionally, attendance at a conference did cost.
Secondly, you have to personalise everything now more than ever. If you’re pitching to an investor, a journalist or a potential hire – whoever it may be – batch messages just don’t work anymore, especially during Covid-19. Investors and journalists may be receiving fewer notes from startups and founders, as the marketplace is temporarily shrinking, but they are expecting a much higher quality pitch and a valuable idea or story that will either strike a chord with their partners or their readers. A lot of investors are still raising. Irish startup Quorum Chat closed a successful round on the same day the NASDAQ crashed. There’s still a lot of appetite, especially for software companies less impacted by Covid-19 restrictions and guidelines.
However, a lot of startups are under massive strain, as this pandemic has completely ripped away business models and customer bases. Now is the time to connect with and learn from your peers and industry leaders.
As you’re in charge of vetting and selecting the most promising early-stage companies to take part in Web Summit’s global family of events, you must be privy to a broad overview of tech innovation. What tech trends do you foresee Europe’s startups taking on in the next few years?
Over the years, we’ve been in a fascinating position to watch several trends sweep over Europe. When I first joined five years ago, we were catching the tail end of social media-focused apps and a huge boom in on-demand economy apps trying to mimic the runaway success of Uber (which, coincidentally, is an alum of the startups track). That progressed into a lot of crypto- and blockchain-focused startups, particularly out of the UK and Germany but – unsurprisingly now – that’s trending down.
I fully expect to see European startups adapt to the new challenges of Covid-19 and, with the success of a company like Zoom, we’re already starting to see a rise in applications from those servicing the work-from-home economy and all that comes with it.
Geographically, we’ve seen an impressive growth from our host country, Portugal. I think Web Summit helped inject a certain energy when we moved to Lisbon in 2016. There has also been incredible support from Portuguese government bodies – such as Startup Lisboa and Startup Portugal – for local and international founders based in the country. Portuguese startups made €2.2 billion in sales in 2018, while Portuguese startup alums have raised €60 million and have participated in 41 funding rounds since 2016. It just goes to show the quality of startups that are coming out of Portugal. Ones to watch are TonicApp, Codacy, Aptoide, Bizay and Hubb.
Germany has always stood out. It’s been one of the highest represented out of the 170 countries that come to our events annually. From a European perspective, it has the highest rate of Web Summit alums that have raised funding, including Bitwala, Taxfix, Gapless, Raisin and Valispace. Valispace just raised a seed round of €2.2 million with JOIN Capital.
Throughout the years, we’ve seen major startup success stories come out of Web Summit. Daniela Braga – the founder of Defined Crowd, a Portuguese cloud startup – sat next to a partner from Evolution Equity Partners at a dinner at Web Summit in 2018. Evolution Equity Partners then went on to lead the startup’s $11.8 million Series A round.
What do you look for in the startups that you accept? How did you design the process that filters through all the noise and assesses their potential for success?
Startups have to apply and be vetted by the team. We’re a global event, so the team and I try to manage an entire ecosystem of startups, and that can be challenging. We have long-standing relationships with founders, investors and journalists who have come to our events for years. They help soundboard and suggest ones to watch.
We are talking everyday to the founders of new companies. We understand the courage, risk and effort it takes to go out on your own and build a business, so we have honest chats with the founders about their teams, their product, their vision and their objectives to see if they would fit and find value at Web Summit. Sometimes the company is too early-stage so it’s best they come as a general attendee for the time being until they have nurtured the idea.
There’s a variety of objectives we have to cater to at the event, and networking is a big one. We’re able to bring together a global audience for these founders to meet. They get access to members of the media who they wouldn’t be able to meet otherwise.
The biggest objective is obviously funding, so we have to have as many opportunities as possible for these founders to meet investors, and to find opportunities for funding through a mixture of pre-organised meetings and serendipitous run-ins with VCs. This is already quite a digital process, even at the physical event, so it’s been easy to move this online with Collision from Home.
Some startups that attend just want to learn, discover and (sorry to be cringey) be inspired. We host sector-driven roundtables, mentor hours and startup masterclasses as well, which are generally hosted by industry leaders.
We have to keep a certain standard, as we have thousands of VCs flying in to meet these startups. They want to return to their HQs with promising prospects to invest in, so the pressure is on to make sure the companies are of a high enough standard. This is why the vetting process is extremely important and, sometimes, if we don’t feel a startup is ready, we have to politely reject them. Often, the founder might re-apply for the next year after taking time to refine their product or revamp their whole business model.
It’s an incredible feeling when you see them grow exponentially from a one-metre booth to becoming household names like OnePlus or Revolut.
The PITCH competition at Web Summit is a three-day event in itself. What advice in terms of preparation and pitching do you usually give the startups to successfully get them through it?
The people who you are pitching have often heard countless iterations of the same format. It’s easy to say ‘be different’, but much harder to do. When you can, present your company with a unique twist. But beware – gimmicks for the sake of gimmicks are less effective than concise and useful facts, statistics, and milestones, that explain why you’re worth a second conversation.
Interestingly, the winners of PITCH can also determine where deal flow is going, as well as consumer trends. Cleantech startup Loliware is working to replace plastics. They won PITCH at Collision 2019 in Toronto. Don Douglas, managing partner at Geekdom Fund, was a judge for Loliware’s pitch. Geekdom went on to lead a US$6 million super-seed round in Loliware a few months later. Showcasing the best of the startups through PITCH can help shine a brighter light and impress investors.
The last two winners of PITCH (at Web Summit 2019 and Collision from Home) have been European medtech startups. Web Summit 2019’s PITCH winner, Nutrix, is from Switzerland and helps diagnose and monitor diabetes through saliva. The most recent winner at our first online-only PITCH competition was GlucoActive, a non-invasive glucose monitoring laser device from Poland.
According to a VC survey we carried out with PitchBook at Collision from Home in June 2020, investors are looking at the underlying metrics of a business and its path to profitability, rather than the founder’s pedigree, to guard against economic uncertainty. Just 15% of venture capitalists surveyed said they valued the executive team’s background when evaluating a new investment. When we did the survey at Web Summit in November 2019, that number was roughly double.