In the Investor’s Mind: Bluebox Perspectives

Alan Cano from Bluebox shares insights on private investing, strategy in LatAm, and success factors.

What motivated you personally to get started in private investing?

‍I could say that knowledge is essential in many ways. I mean, understanding the founders’ personal history, what their drivers are to achieve their goals, and also gaining insights into various industries and how innovation and technology likely have a positive impact and increase efficiency within them.

In the competitive landscape of the LATAM market, what sets Bluebox apart, and how do you intend to capitalize on these advantages to achieve your investment objectives?

Of course, our corporate and investor network, as well as our capabilities to better understand certain sectors and how we can approach opportunities within large corporations. Additionally, our experience with more than 2,000 scouted startups and 12 years in the industry sets us apart as the first players in the region, with a strong presence in Mexico, Colombia, Chile, and Argentina. We also have good partnerships with other leading innovation players in Brazil, the USA, and Europe.

What makes an investment opportunity irresistible for Bluebox? Can you share some key insights on your investment thesis?

I could describe our investment thesis briefly in three important aspects: founders, who need to be exceptional entrepreneurs with values evident through their personal history. The second aspect is the space; our preferred sectors exhibit characteristics such as promising trends in the coming years, a sound business model (including strong unit economics), and ample opportunities for scalability through technology, along with a clearly outlined roadmap in their investment proposal. The third aspect is how Bluebox, through its powerful ecosystem, can help and add value to the company.
I like to think of these three aspects as the perfect mix for a successful investment.

How would you define portfolio success beyond economic return?

In Bluebox, our mantra is that entrepreneurs are changing the world. So, beyond economic returns or achieving high valuations in companies, one of the most important objectives is how we can impact the lives of the people who work in these companies and how our programs can help these companies reach their targets.‍

When it comes to private investing, what would you say is the most significant challenge or pain point that you encounter?

External risks such as regulations, environmental factors, and the need to thoroughly understand the target market pose significant challenges. As venture capitalists, we favor investing in disruptive business models, operating under the hypothesis that these products or services can potentially gain immediate acceptance in the market. Therefore, we must remain flexible in considering pivots proposed by founders, acknowledging the risks associated with investing in early stages and navigating the transition between MVP and product-market fit.

Additionally, the lack of liquidity, compared to other investment vehicles or instruments, is another challenge. Typically, VC funds are structured for long-term durations, leading to issues when some limited partners seek liquidity for reasons unrelated to the fund.

What are the key challenges that a group like ours needs to navigate, and how does Bluebox strategically tackle and overcome these obstacles?

Our primary focus is to thoroughly understand each program or investment opportunity, along with the needs and perspectives of every stakeholder involved. Each investment begins with achieving good alignment between the two parties and conducting a thorough analysis from a perspective that considers the opportunities and aspects we prioritize. During the initial assessments, potential yellow or even red flags are carefully noted and addressed.

What has been the primary factor(s) influencing your investment decisions in the past years? How do you think these will evolve over the upcoming 3 years?

As I said before, the three principal aspects are: founders, space, and how we can add value. In the next years, I believe the third aspect could evolve positively, enabling us to add more value to each company in our portfolio.

Could you share the best investment lesson you’ve learned during your career?

‍You are only the investor. Of course, you can influence some decisions and opinions, but most of the success or failure in each investment depends on the rational decisions made at the moment when you decide to invest.‍

Please leave us a book recommendation.

I just read ‘Make Time’ by Jake Knapp and John Zeratsky. Both of them have worked at Google Ventures and provide excellent tips on prioritizing your time and disabling your personal default settings. Highly recommended.

What’s your favorite non-business interest or hobby?

I enjoy spending quality time hanging out with my girlfriend and friends. Additionally, I really enjoy running because it clears my mind and helps me think better. Recently, I’ve been making an effort to cultivate a reading habit as well.

What’s your take on the private market overall?

Scored: 9