“Good to start, bad to grow.” That’s becoming the unfortunate modus operandi of Spain, at least when it comes to building companies. Barcelona startup Teambox, a cloud-based collaboration and communications company, just closed a $5 million Series A round, and in the process moved their headquarters from Spain to the United States. As of this week, Teambox is officially a Delaware corporation.
The new round was led by Avalon Ventures (US-based), with the Data Collective Fund (US-based) also participating, and builds on previous angel funding since the company was launched in 2008. The $5 million Series A round brings the total company funds raised to $7 million, which also includes original investments from angel investors from Spain (Seedrocket and Keiretsu) and the United States (several individual executives from US tech firms).
While the move shouldn’t come as a surprise, it should serve as another painful reminder that dramatic changes have to be made if Spain plans on really harnessing the long-term economic power of entrepreneurship. Speaking off the cuff, the government needs to implement real, tangible incentives for companies to keep (or move) their headquarters in Spain. I’m talking corporate tax breaks and deferral options for startups, access to work visas to recruit talent, corporate-friendly hiring/firing practices to stay lean, and bankruptcy laws that don’t lead to permanent exile or worse. Fortunately, there is some recent movement on this front that will be rolled out in 2014 (hopefully).
Investors aren’t off the hook either. It’s time to close the loop of the European ecosystem and keep the fastest-growing startups based here, where they can contribute directly and indirectly to the economy and local ecosystem. Of course, there are some bright VCs and private investors in Europe backing innovative and disruptive startups, but they’re the exception. The majority consists of risk-averse, naïve old-timers that prefer to bet on a copycat then sit back and hope there’s a enough traction to cash out in the next round.
Let’s see, Silicon Valley has an abundance of experienced investors, a fail-forward culture, a more qualified work force, and operating in the largest economy in the world. Don’t make the entrepreneur’s decision even easier with hard-nose bargaining over half of a point or a low valuation while dragging them through a painfully slow fundraising process. Luckily, Barcelona has a lower cost of living and higher quality of life so startups put up with Seed rounds that take over a year to fund. Seriously, quit looking in the rearview mirror for investment opportunities. Do your homework, think BIG, and, when you see a great opportunity, pull the trigger!
Sorry for the rant – this post was supposed to be a short piece on a Barcelona success story in the making. Not to take anything away from the Teambox team. Their innovative product design and decisive leadership has produced exceptional growth, with monthly recurring revenue growing 1,273% over the last 24 months. They will pump their new funding back into the product enabling even more customers to collaborate in the cloud and they will do it from their brand new headquarters in Redwood City.
It’s just unfortunate that the majority of new jobs and direct economic contribution may not benefit Spain at all in the long run.
Teambox is a collaboration and communication platform that provides a single place for shared tasks, discussions, files, and HD Videoconferencing. Teambox is simple to use and flexible, enabling project teams and departments at thousands of companies to get work done.
Founded in Barcelona in 2008, the company is privately held and headquartered in Redwood City, California. You can read the full press release here.
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