# Bolt; The Most Insane Story in Startups

Turning a $5K Loan into an $8BN Company · Why Every VC Turned Down One of Europe's Biggest Winners · Competing with Uber & The Future of Micromobility and Self-Driving

20VC · Nov 13, 2024 · 89 min · 19,606 words
Speakers: Markus Villig, Harry Stebbings
Source: https://www.996.fm/episodes/20vc--ep-84fa73de/

## Cold open

**Markus Villig** [0:00]:

We tried to raise every way we could. I met all the VCs around Europe. No matter how many of these meetings I took, and it was dozens, maybe even hundreds, they all told us no. Probably got to the point of doing about 25,000,000 ARR, growing multiple 100% a year, and still no VCs wanted to invest. We went from 0 to 2,000,000 ARR in about eighteen months. And then from there, we went to about 10,000,000 ARR in the next eighteen months. And then we went from that to 100,000,000 ARR in less than two years. So now we have 2,000,000,000 ARR in sort of the next few years. So it was extremely rapid exponential growth throughout this whole business.

**Harry Stebbings** [0:35]:

This is 20 VC

## Intro

**Harry Stebbings** [0:36]:

with me, Harry Stebbings. Now stay, we have Bolt. Bolt is one of the most incredible stories in venture capital and start ups. The company has scaled over $2,000,000,000 in annual recurring revenue, but along the way, every single top tier European venture investor turned them down. They got lifeline funding from, check this out, a Baltic real estate company, which kept them alive, and now they have over 200,000,000 customers and challenge Uber on a global scale. Today, the story of Bolt to an incredible $8,000,000,000 valuation with their founder, Markus Villig, joining us in the hot seat.

## Sponsor read

**Harry Stebbings** [1:13]:

Before we begin, let me share an exciting development from HIVE. It's called the HIVE 50, and it's the first live index of large cap private securities generated directly by customer orders and transactions on Over 70% of US based decacons have traded on HIVE, and the HIVE 50 ranks the 50 most liquid securities on its platform based on transaction volume and liquidity. The index equally weighs the top 50 stocks, effectively acting as a barometer for the market's direction and momentum in private tech company investments. Go check it out at hive.com/hivefifty. That's HIVE with two i's to see how they're shaping the future of private market investing. HIVE Markets Limited is a broker dealer and member of FINRA SIPC. Investments in private stocks are risky. Only accredited investors may buy through HIVE. And just like HIVE transforms liquidity, Tekus transforms how we gather insights for investing. When I invest in software today, I think software is valuable when it saves time and makes something easier. But when it enables the user to do something they simply could not do without it, then it's insanely powerful and valuable. That's the case with Tekus. I literally could not live without them. When I'm investing in a company, Tekus lets me see the most incredible reference calls with experts in a space who work at a competitive company or incumbents. These calls and data provide the most incredible insight that really shapes my opinions and thoughts and investment decisions. And I can then share snippets from calls with team members. This is a tool that will change how you work. Honestly, you cannot imagine life without it once you've experienced how powerful it is. And you can check the maps today by heading over to tigus.com. And just like Tigus, HMC helps bring powerful ideas to life. Here's a great opportunity for all visionaries out there. Harvard Management Company is constantly seeking out the next generation of great investors and entrepreneurs. HMC has managed Harvard University's endowment for nearly fifty years and was one of the first institutional investors in venture capital. Their experience and long term investment horizon make them ideal partners to get world changing ideas on a path to viability and success. Whether you're launching your first fund or your fifth, HMC welcomes the opportunity to partner with both developing and established managers. Have an idea you wanna share with the team? Send it over to venture@hmc.Harvard.edu. You have now arrived at your destination.

## Conversation

**Harry Stebbings** [3:41]:

Markus, dude, I am so excited for this. Thank you so much for joining me today. Excited to finally be on the show. Dude, this is so good to make happen. Now I hear that the start was a 19 year old student in Estonia who obviously didn't have a driver's license. I don't either to this day, so I'm thrilled about this. But can you take me to the specific moment that you had the shit, I need to found Bolt?

**Markus Villig** [4:04]:

Actually, the story started when I was 10 years old. So I knew already by that moment that I'm gonna be a tech entrepreneur for life. I realized that I'm really great at technology. I really cared about software. I was always looking at all the latest gadgets. And I realized I really like commerce. I liked working with people, figuring out how to make money. So in kindergarten, I was, you know, selling Legos. Then in school times, was selling some collectibles. Then I learned to code, started building websites for local companies. So already as a teenager, it was clear that this is gonna be my passion for the next couple of decades. What did your parents say? They said go for it. And the reason for it was very simple, because they grew up in the Soviet Union. So, I mean, we grew up under the Russian occupation in Estonia. And at the time, entrepreneurship was banned. So they couldn't pursue their ambitions. They couldn't build a business. So when I was growing up in the nineties, finally in sort of a free, democratic country of Estonia, like, they really told me that go for it, like challenge whatever things you want to do in the world, go for it. So I I really grew up in that environment.

**Harry Stebbings** [5:04]:

Okay. So we have this kind of entrepreneurial streak from very early. Mhmm. And then we are 19 as a student and don't have a license.

**Markus Villig** [5:12]:

Where does the Bolt idea come from? So once I had learned how to code and I was building these websites and making money on the site, I always knew that that's not gonna be my long term ambition. I I wanted to start a startup. So I first experimented around with a bunch of different ideas. I first built a mobile app for our school's online educational system. That didn't go too far because I realized very quickly the schools don't have a lot of money and the sales cycles are horribly wrong and it's public sector. So after six months, I gave up on that idea. What it takes ten years for a VC to learn an ad tech you just learned very quickly. Exactly. And then I took a very systematic approach. I spent a couple of months starting different industries. And I just more and more over time started to realize that transportation is the most exciting space for me in the world. And there was a number of factors for So first, it was very clear that we're going through this once in a generation shift. So people will not be needing to own assets, but they can start to use assets on demand. Similar to what had happened to music, to videos, increasingly to many, many other sectors, it was clear that's going to happen in transport. Second, electric cars were coming along, and that was just this big revolution that I thought is gonna shake up the industry. And third, it was clear that you will also have micromobility. So you will go from building these large combustion engine cars to having electric motorbikes, cycles, electric scooters, and I thought there's another opportunity there. And then fourth, there was the shift to from you driving your car to potentially self driving happening. So I was just amazed, like, wow, okay, transportation is really gonna go through this massive shift. I need to be in that industry. It doesn't even matter what I'm gonna do, but that's the place to be. So you have this realization.

**Harry Stebbings** [6:47]:

What do you do next? The majority of people fail, I always think, because they don't take the first step. What do you do post, I wanna innovate in transportation in this shared new economy of not owning assets? What's the next step?

**Markus Villig** [6:58]:

So I started then as a 19 year old kid by literally googling how do you start a startup. So I went to this Y Combinator and other websites. There was great content out there. And the top one advice was always that you gotta validate your interests of customers and the suppliers before you build the first line of code. So I did that. I set up this survey on social media in Google Forms, sent it to my school list, put it up everywhere I could. And hundreds of people replied. And they all said that, yeah, they agree. The taxi industry in in Tallinn at the time was horrible, and it was so horrible that if you were to design a bad experience, that's what you would essentially design. I So can walk you through how it was. So you had 15 different companies. You had to call all of them. Most of the time, they didn't even pick up. Then even if they did pick up, the car almost never actually made it to you. Even if it did made it to you, then the car was in a horrible shape. It was dirty, the driver was rude, you could forget about paying with a card, you always had to pay in cash. So it was just all around a really bad experience. And I was thinking that there must be a better way to organize this, and so did hundreds of other people. So I was thinking after this survey, wow, this is great. This is the easiest startup ever. Everybody's so excited and waiting for me to launch. I haven't even built anything. And then the trouble started. So then I had to go and validate the supply side. So then after school, for multiple months, every day I went to these taxi stands that you have all around the world. So you go there as a kid, you open up the door, get in, start pitching the driver. We have this new app. You should sign up. You're gonna be making extra money. And the sales went really well. 90% of them immediately said, Get out of my car. I don't want to deal with you. Who are you? Some random teenager. You know, I want to watch my news and whatever. So that was very frustrating. But they kept on doing that for months and months. I think most people would have given up. And they did it until I had about 50 drivers who I had finally persuaded to give me their contacts. Did the message change

**Harry Stebbings** [8:52]:

to make it successful with those 50, or was it just persistence?

**Markus Villig** [8:55]:

I think that I was sort of optimizing the wording a bit, as you would in sort of face to face sales, because over time I saw what was getting me the better conversion. But at the end of the day, the pitch was simple. You're currently stuck under this legacy taxi company that doesn't give you a lot of work. That's why you're sitting here in this taxi stand. You should sign up to this app. It's low risk. You're just gonna be paying a small commission every time you get a trip, so it should be a no brainer. And even then, most of the drivers didn't wanna sign up. So it was a big uphill climb to make it happen. So then we had 50. What did we do then? So once I had validated the consumer interest and I had got the first drivers on board, I started building the app. So I was back then '19. Everybody else in my high school was studying for exams, but I had gotten lucky. I had completed one of these National Computer Science Olympiads. So I had got to a good grade there, and they had given me a free pass to university. So that gave me a free pass, effective. I was like, I don't care about the exams. I'm going to get into uni anyway. So that gives me six months to work on this product. So they spent all the other time I had aside from being in the taxi stands by actually coding. So I was building the consumer app, the driver app, trying to build a back end. And I realized very quickly that this is going fine, but I'm not that capable of programmer that I can build all of these systems as quickly as I need. So then I went to my older brother who is fifteen years older and had a great career in tech and then used to be one of the early employees at Skype back in 2004. So he had a great network of engineers. So I went to him and I was like, we need to get some engineer on board to help me with this. I need a co founder. And I think we talked to it must have been at least 30 people. Every single one of them turned me down because why would you join? It's a 19 year old kid. They have no experience, no money. Was Uber known at the time? Absolutely not. So back then, were a limousine company in The US. So I was thinking that, yeah, these guys have raised money, but, like, I don't think I'm ever gonna compete with them, which is gonna be a And so the model wasn't validated for anyone and going, is this the Absolutely not. So so back then, it was nobody had even heard of these apps, at least our part of the world. Everybody was just using the phone dispatcher to get it right.

**Harry Stebbings** [11:01]:

So you have 30 conversations, none of them join.

**Markus Villig** [11:04]:

Exactly. So it was it was a very tough time recruiting this co founder, and then we got more and more desperate. So we we started publishing this on random forums in Estonia, whether it was programming forums or random job sites. And then one day I get this email from a candidate who writes to me that let's meet up and they want to hear more. And I mean, I didn't have any other candidates anyway, so I was like, sure, let's meet. And I quickly Google before I go there, how do you interview a person? Being a 19 year old kid, I never hired anyone. So I show up to this meeting. I pitch him for probably an hour about what we're trying to do and why this is exciting. And then the problem is that most software engineers are pretty sort of introverted people. Like, they don't really show you on the meeting whether they're excited or not. And I can tell you that Estonian software engineers are even worse than that. So I had no clue at the end of the meeting whether this guy is excited or not. So I go out and I'm the wiser, and then a few days later he writes to me again that let's meet up. And then this magical moment happens. I get into this cafe with him. He pulls out the phone. He pulls out another phone. And this guy, just in a couple of days at home, built a rider application, driver application, all the back end, just makes an order on the spot. And he's like, Hey, I got so excited about the idea that I just went home and built this to prove you that I'm a capable guy. So I just said on the spot, Wow, you're hired. I've been working on this for months and this guy did it all in a couple of days. That was Oliver, who turned out to be our technical co founder, who's still with a company. Eleven years later, he's the most brilliant software engineer I've ever worked with. And, Ride, I just found him from a random forum and he just showed up, built the thing as basically a test assignment.

**Harry Stebbings** [12:38]:

How much of success in business is luck versus skill? Respectfully, it's quite lucky that that happened.

**Markus Villig** [12:44]:

It's it's amazing. I think that in our case, without Oliver, the company would have never been where it is. So I'd say it's even close to 100% of luck.

**Harry Stebbings** [12:51]:

What would you say is the biggest advice for founders looking to find another co founder?

**Markus Villig** [12:56]:

I'd say from from that story is that you can never give up. And even if the first 30 people don't work out, just keep on going. And you can really try to find people from all sorts of channels. You don't need to only go through your networks. Sometimes these random forums actually churn out amazing candidates, so just keep on doing it.

**Harry Stebbings** [13:14]:

I didn't know that story. I love that. And so we have Oliver then, and we start building out the back end, the front end. Product is now starting to Talk to me about going live. When did we go live and how did that response go?

**Markus Villig** [13:27]:

So the tricky bit is that marketplaces are probably the toughest businesses to get going. So if you build a b to b SaaS application, for example, you can fully control the consumer experience. That's not the case with marketplaces because you need to overcome this chicken and egg problem. You need the drivers and you need the customers at the same time. And both of them are very impatient. So if a driver signs up, they expect to get trips at most in a couple of hours. Otherwise, they're not gonna bother keeping the app online, especially back then when data was more expensive as well. And then on the consumer side, it's even worse because if they open the app, they need to get a ride in a couple of minutes. If you don't have a car nearby in that area, they're just gonna move on. So it's a very tricky marketplace, especially in ride hailing, to get it off the ground. There's many marketplaces that are far easier. So, for example, contrast this to Airbnb. Like, a supplier might sign up. It's completely fine. They don't get any bookings for a few days. They can wait. But that's not the case with the driver. So, now, how did we overcome that was very tricky. So, first of all, we didn't have any budget. You hadn't raised any money. Yeah. So back then, I was a 19 year old kid with no budget, and the only thing I was able to do was I went to my parents, and I was like, Hey, we really need some budget to get this thing off the ground. We came from very modest means, Estonia, especially back then wasn't a rich country. So they said, Yeah, we put aside $5,000 for your university fund. And we're fine to give it to you, we trust you, but if you spend all this money on this project, you gotta cover your own rent for the next few years at uni. So I thought about it for a couple of seconds and I was, okay, let's do it. Give me the cash. And that was the initial funding we used to get the company off the ground. So we spent a bit of that on product development. We spent it to get the first sort of stickers and some of the billboards and business cards ordered. And it was a very humble beginning of just trying to hack in every different free organic manner we could to get the first initial traffic to the platform. Okay.

**Harry Stebbings** [15:13]:

So then we launch, and it's difficult. You're managing demand, supply. How does that go?

**Markus Villig** [15:19]:

So the odd thing about this business from for us for day one was that it was very asymmetric. So the consumer side was from day one actually very strong. So we got the tone of free media. It was a great story. Everybody hated the tax industry. There was this young kid who tried to fix it. So we got hundreds of initial sign ups coming into the app, and that was great. But the problem was almost every single one of them got a really bad experience because we barely had any drivers online. So they opened the app, the cars similarly didn't show up, or the experience wasn't great. And I got really into a panic mode because I was thinking that we can't just waste this first initial burst of demand that came in because if all these people get a bad experience, we're gonna get a bad rep and we're never gonna be getting out of this problem. So I did everything I could. So I went on the streets of Tallinn, signing up taxi drivers one by one again. This time, at least, I had an app so I could sign them up on the spot. And that turned out to be a very effective sales tactic, what I recommend to more founders nowadays, which is that I just got in the car and then I just wouldn't go out of the car before the driver had signed up. So I just were like, Hey, like, give me your details. I'll just do the account for you. Download the app. Set it up. And I was like, Okay, give me five minutes. I'll set it up for you. And just every time you come online, click this button and the app is gonna open up. So I did this really curated sort of service to get every single driver online. And then I realized that that wasn't even enough. So I went to my older brother Martin, worked who at a different tech company at the time, and I was like, hey, can you help me with this as well? And then I went to my mom, and I was like, hey, can you help me with this as well? Because, like, we need even more people on board. So it was a very humble beginning of just using everybody I knew to to sort of try to help and sell me these drivers to get them started. Are you making money at this point? Like, on the first

**Harry Stebbings** [16:56]:

day, I'm just fascinated.

**Markus Villig** [16:58]:

How many people took a ride? So I think that we started off by doing about five trips on the first day, and then it started very, very gradually growing from there. So took us a couple of months before we got to 100 trips a day, and then very quickly it went from that to 200, 500, 1,000 trips a day. And then it was already obvious that this thing has taken off, and it's gonna become sustainable, and we could start to hire the first employees.

**Harry Stebbings** [17:21]:

When was it most obvious to you that you had, like, the Hale product market fit?

**Markus Villig** [17:25]:

Actually, the whole thing was that we saw this massive consumer demand from day one. So it was very clear that consumers really want this service. So that was never the question for The hard part from us from eleven years ago until today has always been the supply side. Our mantra every single time we have our internal all hands meetings for eleven years, it always ends with one slide, is add supply. So that's always been the biggest blocker for us. How do you get more drivers on board? Nowadays, we can expand that to how do you get more couriers on board, more restaurants on board. That's always been the biggest focus for us. When you look back at those very early

**Harry Stebbings** [17:57]:

days, what did you do that you wish you hadn't done?

**Markus Villig** [18:02]:

I think I should have been more aggressive with initial fundraising. I think we could have sped ourselves up a couple of months if I had gotten out and raised a small angel check before I did, because we we bootstrapped the company completely for about the first year. So we built the product, we got to some thousands of daily trips, and we did all of that with $5,000 from my parents. So I think we actually could have accelerated a bit if we had gone and raised a small angel ticket before.

**Harry Stebbings** [18:29]:

Respectfully, why are these businesses so capital inefficient? When you look at your your Ubers or your you name it, they are so capital inefficient and the cost it is to manage and run them is extraordinary. How are you able to do a first year, thousands of trips with $5,000, and everyone else takes $15,000,000 in a seed round?

**Markus Villig** [18:50]:

So still to this day, we're the only company in this whole industry that's achieved that. So there's been dozens of these companies that by now have raised billions of dollars. And I think it comes down to a few things. First of all, I think it was the internal culture of the people who were part of that initial team. So me, Oliver, Martin, my brother, the first employees, we just came from this really frugal and resourceful mindset where the only thing we're thinking of is how do we get this business to profitability without raising any money, how do we keep our costs as low as possible. And that's a completely different mentality than how all of these other businesses were built. So, specifically, look at some of our US competitors who raised $30,000,000,000 I mean, these companies obviously started off with having so much excess cash that they got very bloated. It was never a problem for them that they had to optimize for costs because they could always go out and raise more money. And we came from literally the opposite, which was we had no money and we had to make everything work with very little. Where did having no money benefit you, and where did having no money hurt you? The biggest benefit for us was probably in terms of attracting the right people, because we could never pay even very attractive salaries. In terms of cash, I think we're always paying sort of mid market or low. But what we did to compensate for that was that we gave people generous equity. So we tried to attract people who were really missionaries, not mercenaries, and that really worked out nicely. And the other big benefit was that it really defined the company culture. So the first couple dozen people who joined, we went through this brutal period the first couple of years where we couldn't raise any money while our competitors were raising literally billions of dollars. And that just forced us to be so effective at how we spent every single euro. We had this huge analytical dashboards of measuring ROI, measuring every single thing we do, and that just cascaded now down into what the company is today. But if we didn't have that cash crunch in the beginning, I don't think that ruthless sort of frugal culture would have ever formed otherwise. Why did you raise money when you did? So what we realized eventually was that, yes, we can keep on bootstrapping this company forever. We built it to about 10,000,000 annual revenues without raising any external financing effectively. Raised 10,000,000 annual revenues. Yeah. So we raised about 1,000,000 of an annual of the first seed fund, and then we built the company to 10,000,000 ARR with that, which is unprecedented in most places, not to mention in this industry.

**Harry Stebbings** [21:08]:

Who was the first investor, and how did that meeting go? You were, like, at this point, 1920? Exactly. So You're Googling how to hire someone. I don't imagine an investor meeting is that much more natural.

**Markus Villig** [21:17]:

So so I was 20 years old. We had this good traction going on in Estonia and then we wanted to raise the first 1,000,000 seed round to to expand. I reached out to everybody in in Estonia I I could think of And then we raised the first round mainly from some small local VC funds who were just setting up back in the day and some first early Skype employees. What was the price? I think it was probably a 9,000,000 valuation. So we raised a million euros at that moment. Would

**Harry Stebbings** [21:42]:

that round still happen today? And what I mean by that is with the globalization of venture startups content, would you just go global from day one and just go to YC or hopefully through shows like ours, come to people like us? Or do you think there are still 19 year olds in Tallinn who would raise from locals because they've never heard of this world?

**Markus Villig** [22:02]:

I think that for sure there's a huge population of those people who still think that it's easier to raise locally than it is internationally. So I don't think globalization has gotten to that point yet. Whether that is effective is another matter. I do think that it would make more sense for them at least to approach the European VCs and raise a more serious round from the get go. The valuations have massively spiked as well. So I think if today we we had the same metrics, we would probably be raising that round at the 50,000,000 valuation, not the 9,000,000 valuation. Okay. So you raise one on nine, and then you go for 10,000,000 in revenue? Yeah. So so then it was a couple of years of grind after that because we raised this 1,000,000. We then tried to launch 10 countries at the same time. 10 at the same time. We were absolutely amateurs at what we were trying to do. So so we we went from trying to launch Estonia to trying to suddenly launch in The Netherlands, in The US, in a bunch of other places around the world. And we almost bankrupted the company in six months. So we burned for most of that 1,000,000 very rapidly with nothing to show for it. And the lesson for us from that era was that you really gotta take these expansion cities sequentially and not in parallel. So we then actually had to make the hard call of letting all those people go, shutting down effectively all of those markets, and we thought, okay, let's figure out how do we go from one to N. So how do we then figure out how do we do Latvia or Lithuania or Poland and just take the closest geographic countries to us and figure them out one by one, figure out the launch model. And then once we've done that, then let's go and actually raise around and replicate it. So we did it the other way around. We were too optimistic. So what did you cut

**Harry Stebbings** [23:35]:

down to? So you expand to 10 at the same time, and you go, shit, this isn't working, cut back. What do you cut back to?

**Markus Villig** [23:43]:

So I think we were left with about 15 employees, most of whom were then related to the Estonian operation, which was the only piece of the business that was actually working well and growing organically. So that was a self funding business. And then we had a couple of people that we could afford to actually work on the international expansion.

**Harry Stebbings** [23:59]:

How do you respond to people who say, well, when you expand to new markets, there'll always be loss making markets, and you have to subsidize the loss making markets with the profitable Estonian markets, and that's the nature of the beast. The maturation of the market will come.

**Markus Villig** [24:12]:

Mhmm.

**Harry Stebbings** [24:12]:

Is that right? Or are you like, no, we can have unit economically efficient markets from day one?

**Markus Villig** [24:17]:

For marketplaces such as ours, there is no way you can have positive unit economics from day one. And the reason for it is very simple. This is a very strong network effect business, which means that you do need to overcome this initial chicken and egg problem. You need to get the drivers online, you need to get the customers online, and at first, unit economics are deeply negative. You actually have to subsidize both sides of the marketplace to get the liquidity up. And then once you cross a certain threshold, then it becomes self sustaining. Hit critical mass and then it becomes profitable business. What have been your lessons on what that threshold is? For most of these type of urban on demand mobility marketplaces, the ratio is about 25% market share. That's a very high bar. So you really need to subsidize hard, oftentimes for a couple of years, before you get to that threshold, and that's when the network effects kick in.

**Harry Stebbings** [25:04]:

We talked about that kind of launch playbook. How did the development of that launch playbook go? We're back now to 15. We've got Estonia working well, but we've had 10 that didn't go so well. How did we go about that playbook creation?

**Markus Villig** [25:17]:

It was a very iterative process, so and very humble beginning. So my brother Martin, we designated him to launch the first Latvian market. So he literally went there, rented a small apartment, which then also turned out to be our office after a couple of months, and then he just basically slept there and then hired a few young students to help him. And that's how we set it up. So he was going to meet the taxi companies, meet individual taxi drivers, organically start to figure out how do we get demand into the marketplace by giving out business cards and leafletting and all of that. So very humble beginnings. What have been your biggest lessons

**Harry Stebbings** [25:51]:

on what works for driver

**Markus Villig** [25:52]:

supply and what doesn't? At the end of the day, about 80% of our volume is driven organically from word-of-mouth. So nothing can beat that, even today. And all the paid channels make up about 20% in a mature phase. However, once you start in a market, of course, it's different because nobody's heard of your product. So the question really is how do you get the first couple of 100 drivers and the first couple of 100 customers on board? And, generally, we see the most effective for both sides is a combination of PR. So you always gotta get some first launch media and you get some exposure from that. And then the other thing is just paid online ads. And for us, generally, the most effective turned out to be Instagram and Facebook ads. So that's how you get the first couple of 100 people excited. And then after that, your product needs to be great because if it's not, then all your cohorts will fall to zero. If you actually have a fantastic value proposition, then the other way around, your k factor is gonna be positive, you're gonna be exponentially growing.

**Harry Stebbings** [26:43]:

Listen, I'm an investor. We get shoved CAC to LTV ratios the whole time by founders. And the question that I always kind of oscillate on is, do CACs go down with time as you increase word-of-mouth and brand, or do they go up as you saturate your core ICP in the core target market? How would you advise me?

**Markus Villig** [27:00]:

So marketplaces have this very unique dynamic, which is that in your first six months, unit economics are always horrible because you don't have enough liquidity in the marketplace. So you constantly need to subsidize the drivers, otherwise they're gonna drop off. You constantly need to subsidize the customers, otherwise they're gonna go away. So your first six months of unit economics will tell you effectively absolutely nothing. So they always look bad. And then you just gotta have faith in the model that as long as you keep on investing long enough, then you will hit some threshold, and then it's gonna flip into profitability. And that is almost impossible for any financial person normally to understand. And then that was why it was very difficult for us to raise funding initially as well. Totally

**Harry Stebbings** [27:37]:

get you there. Any other lessons on driver supply that were like, I wish we'd done this, I wish we hadn't done this?

**Markus Villig** [27:43]:

So one trick we did that really helped us get going in some of the first markets was actually to go to the market with a SaaS product and then convert it into a marketplace afterwards. So there's a good saying that people might join you for the tools and stay for the network, and that's effectively the logic we did. So in some of these countries, we had no money, so we couldn't do our nowadays playbook of going in and then paying the drivers to stay online for a certain number of hours. We just didn't have the budget for it. So instead, what we thought is maybe let's go to these local taxi companies and give them great tools instead. So we give them fleet management software, we give them dispatching software. They really have a huge productivity lift from that because otherwise they were running on old school radios and writing stuff down in notebooks. So they really loved it. So we were able to get the first companies on board with that. And then they added all their supply into the ecosystem, so we suddenly had hundreds of drivers online. That was sort of what sold the supply side for us. And then we then took the next six months to build up the consumer platform without worrying about this chicken and egg problem because the drivers were there anyway. And then, of course, what happened over the next couple of years was that these taxi companies at some point realized that, Hey, we don't even need this dispatching software any longer. Like, we can just actually drop our call centers and we're just going to get all of our demand from this application. So it was a very sort of natural go to market that I think actually a lot of these marketplace founders oftentimes miss that that's a great opportunity.

**Harry Stebbings** [29:02]:

What market was the biggest surprise, good or bad, and why?

**Markus Villig** [29:07]:

I think the biggest surprise I've had to this day was how successful we were in Africa. So we raised this first million, we tried to launch in a bunch of markets, that failed. Then we took a step back and started doing this iterative approach of launching incrementally one country after another. And I think we had about four or five countries working nicely in Europe, and we're quite happy with that. And when you say working nicely, what revenue are we at there? So probably each of those was doing maybe €10,000,000 of gross bookings in terms of how much people were spending on the fares, and then our commission of that was typically around 15%. So it was like 1,500,000 ARR per country. Okay. This is real volume. Yeah, so it was decent. We could hire a decent team to run the country, they were growing nicely. But when you then zoomed out and thought about where is this business gonna go over the next couple of years, it was clear that we need more geographies. We can't just operate in these small Central Eastern European countries, and that was never the ambition for us. Then what we did was we just made an Excel list of the top 200 cities in the world. We ranked them by about seven criteria. On purpose, we kept these models very simple rather than complex. It was things like population, regulation, number of drivers, what's the car ownership rate in the country, metrics like that. We then ranked the table, and we tried to take all of our bias away from it and just look at what does the table say. And all the African cities were ranking top of the list. And we had no clue about Africa. I'd never even been there. So the top one city on the list was Johannesburg. And none of us had been there. We had no idea what's going on. And we didn't want to replicate the earlier mistake of prematurely hiring people into countries before we knew whether they were gonna work out, and we didn't really have the budget to do that anyway. So we thought back then in 2015, is there a more cost effective way to launch these markets? And then a trick I still don't understand why more companies don't do is that we just then set up online ads to customers and to drivers saying that Bolt is now live in Johannesburg without having nothing. So we just put like a couple €100 budget, start running the ads in a bunch of these cities, in dozens of these cities that we had identified. And then the whole idea was that let's run it for a couple of weeks, see how many customers signed up, what is the CAC ratios in all those places, where do we see the best ROIs, and that's gonna be immensely valuable signal to then figure out which are actually gonna be the places we're gonna launch. And this was such an effective hack. So in just a couple of weeks we identified that, Hey, here's the top seven cities that have the best numbers, so let's now go to those and only hire people in those cities. And some of them were very unintuitive, so many of the cities from the regional list dropped off. Okay. So what were the top one to two? So exactly. The first one was Johannesburg, and top two was Lagos, Okay.

**Harry Stebbings** [31:42]:

Johannesburg and Lagos. You are still respectfully a kid from Estonia, from Tallinn, and you've never been there. How do you launch in Johannesburg and Lagos?

**Markus Villig** [31:53]:

That was the thing that also really differentiated us from most companies, was that we really always look extremely pragmatically at everything. And we always try to calculate the ROIs of everything, we sort of go from first principles. So the logic for us then was that, okay, what do you really need to get this service off the ground? So effectively, you need hundreds of drivers in the ecosystem. But, okay, what do you need for that? So we just started running these online ads for drivers, and we saw that hundreds of them were signing up because unemployment rates in some of these countries were huge, like 30%. So you had a lot of people who wanted to make extra income. And then we thought, okay, what's next? We just put up an online ad for hiring the first employee. And some young kid from a university signed up as a sort of part time job. And then we had this Skype interview with him back in, like, 2016 when nobody was hiring remotely. And we told this kid over a video call, Hey, we're gonna figure out a way how to send you a card so you can pay for utilities. So you go and you find an office space, and then you start calling all these drivers and start training them. And that's what we did. So this young kid just trusted us over a video call, caught the first office space. We sent him a list of drivers. He called them and got them into the office and trained them up. And that's how we prepared for launch. So that happened for a couple of months. We had enough drivers, and then one day we just clicked the switch and turned on the service for customers. Eventually, of course, we realized that the market became huge. It started doing hundreds of millions of dollars of gross bookings, tens of millions of revenue. Was Africa an immediate success? So the bizarre thing was that we started it as an experiment. And we thought, if these are gonna be turning out as good of a market as, let's say, Latvia, then we're gonna be happy. But instead what happened was in six months, Johannesburg went from being zero to being more than half the business just from scratch, with one local student running the whole operation. How many other cities did you have in play at that time? It was probably

**Harry Stebbings** [33:39]:

15 cities live in Europe at the moment. And it was more than half the business? It was incredible. So why was that? Was that frequency of trips number of

**Markus Villig** [33:47]:

actual kind of customers? So how we measure success in the company has always been by one metric from day one of the company, which is cross bookings. So it's how much actual monetary volume of transactions is happening on the platform. And it was incredible to us. The number of trips was immense. It went very quickly from zero to millions. But the monetary value of the trips was was so high, we didn't really expect it that South African trips are gonna be almost the same price as some of these trips in Eastern Europe.

**Harry Stebbings** [34:14]:

Why gross bookings? That doesn't necessarily determine user happiness. So, like, frequency of trips would suggest actually that I I love it and I just can't get enough of it, but they may not be very much. It may be just quickly around the corner or a mile. Why is gross bookings the focus?

**Markus Villig** [34:30]:

My view is that it's the only thing that matters. And if you ask me what's our retention, what's our activation rate, what's our CAC, I couldn't tell you really any of those things because I don't think they're real like, they're completely irrelevant. So the only thing that at the end of the day matters is what's your GMV or gross bookings. And I think it encapsulates everything that is either going good or going bad in the business. And the reason for it is that if you have great retention, then consumers will keep on returning to the platform. They will keep on doing GMV. If they like it, they're gonna be increasing their frequency over time, which means they will do even more GMV. And they will also get their friends to the platform, which will bring even more GMV. So again, that's the only North Star metric we're focused on. And of course, there are some teams who look at CAC, who look at acquisition rates, you know, who look at the retention rates, but that's a clear secondary priority for us. That's never been the north star of the business.

**Harry Stebbings** [35:21]:

Okay. So we have Johannesburg now, and we have Lagos now, and we're looking at this going, maybe underestimated the potential of this business in different parts of the world. Do we have a strategic discussion now in management and say something's changed?

**Markus Villig** [35:36]:

Absolutely. So we were just monitoring these dashboards every few hours. We couldn't believe what was going on because just the consumers signing up were by the thousands every day. We had these thousands of drivers signing up who wanted to all get on the platform. So we very quickly had to update our sort of priors and be like, Okay, like, this is actually going to be fantastic. Like, this might be the entire company six months from now. And that's exactly what happened. So we created a SWAT team of people in Tallinn who identified, okay, what are the next 15 countries in the world where we could replicate the same thing? So we just continued with this original exercise of then taking the next cities from the list, running ads in those places, figuring out which ones have the best traction and just launching there. And we went very quickly from having no presence outside Europe into suddenly being live in about 15 countries. So we launched all the major African economies. We even launched in places like Mexico without having no presence there, not flying anybody there, just full remote launches. And and almost all of these launches turned out to be fantastically successful. What did you do that made you successful with these launches first? So now what is worth to mention is that we weren't the first to market in those places. And that's what really makes Bolt a unique company. Because as I described already, this is a very heavy network effect business. So the first player has a huge advantage. They have bigger density. They have, therefore, better pickup times in terms of the cars. They can, therefore, offer you a much better customer value proposition. So if you're coming in as a second player, it's generally almost impossible to ever catch up to that unless you have something very unique that the other player isn't doing. So what we did, there was a couple of differentiators. First of all, we localized much better. What was clear was that, especially these American players in these markets, completely neglected their local needs. So How did they neglect local needs? One trivial example. They were operating in Kenya only allowing you to book a ride if you had a credit card attached. You know how many people in Kenya have a credit card? Less than 2%. So they were just completely missing 98% of the market who even couldn't use the service. So we were, wow, there's effectively a complete opening for us, of empty market that we can go into. And the other thing was that we really optimized for being the most cost efficient ride hailing operator in the world. So we took a very small cut, and what that enabled us to do was that we were able to pass on much better rates for the customers. So generally, they were paying 10% less. And we were also able to pay the drivers 5% to 10% better as well. So actually, both sides of the marketplace had a very clear financial reason why to flip over to us. And then that was enough to overcome this initial critical mess.

**Harry Stebbings** [38:11]:

This is a bit of a direct one. I mentioned it to you before. I I spoke to Dara at Uber before the show, and he said, essentially, you are often second or third in a market. How do you feel about that, and is that an okay strategy?

**Markus Villig** [38:25]:

Well, I'm a facts and numbers based guy, so let's look at that. Today, operate in about 50 countries around the world, and Bolt is the number one most popular platform in more than 20 of them. So we're feeling pretty happy about where we are. And when we look at the trend of most of those other 30 where we operate, we are continuously taking share for the reasons I mentioned earlier. We offer a better value proposition to the customer, we offer a better value proposition to the driver. And in a lot of those places, we're confident that over time, even though we're a second mover, we've done that before. I think we can catch up and actually become the most popular platform. Is it still a good business if you are second? Depends on whether you're a frugal company. I'd say that if I look at some of our competitors like Lyft in The US, I don't think that being a number two is sustainable. But it is a very profitable business if you're able to run a very lean operation.

**Harry Stebbings** [39:16]:

I'm sorry for the spicy request. What happens to Lyft from here? You mentioned them.

**Markus Villig** [39:22]:

Their only way out of this is to optimize their costs. I just generally don't see how they're gonna be an independent company five years from now with the current cost structure. Do you think they sell? I can't really think who would be a natural acquirer. It's not easy company to turn around. So we have

**Harry Stebbings** [39:37]:

this like massive market expansion and we are now in Africa, we're in Kenya, we're in Johannesburg. What was the first and most important things that broke in this global expansion? Cause this just sounds like too good to be true.

**Markus Villig** [39:51]:

So, of course, what was going on behind the scenes was Mayhem. It was complete mayhem. Right? So we were running all of this with a tiny team of about five people from Estonia. None of us had beaten these car markets before, so we had to figure out everything. How do you localize the product? How do you collect payments? It was a complete mess, but it was also the most fantastic, the most fun part of the business because we were all young kids just figuring stuff out on the go. Now, I'd say that, actually, nothing major broke, but I think the one area that we neglected for too long was how intensely we focused on, especially on the regulatory bit. So I think we started off as a small company and didn't have to worry about it, because, again, oftentimes we were the second mover into these countries. So by the time we came in, the regulation was already sorted. But there were a of instances where, for example, in Poland or in Czech or in The Baltics, we were the ones who defined the category. And the regulators were then coming to us and were asking us for input, like, How should we regulate this thing? There hasn't been a platform such as yours here before. And I think we neglected it for too long before we actually realized that I think we should set up a public policy team and actually give these regulators what they need. Mean, give them input of what we think are the best practices how to regulate this thing. And, of course, that doesn't come naturally to most tech companies, especially ones growing at that hyper speed. So I think we probably could have done that more over a year or two earlier of just engaging with the public and sort of trying to influence where this goes. Is

**Harry Stebbings** [41:14]:

speed the single most important thing in startup growth and development?

**Markus Villig** [41:17]:

Speed is absolutely the most important thing, if you can execute it with high quality. Because I do see a lot of companies that execute fast, but I think they're just cutting corners and and launching that they they shouldn't be launching. And then at the end of the day, it's it's a lot of momentum, but really no progress. So

**Harry Stebbings** [41:33]:

What thing did you do very fast that you should have done more slowly?

**Markus Villig** [41:38]:

I think we could have actually been more deliberate about which markets we choose to expand into. So I think that, as I mentioned, we had this first wave where we just expanded with the wrong model. And looking back, if we hadn't done that and we would have done this better model that we stumbled into a couple years later, I think we could have just accelerated the whole evolution of the company by that period. Okay.

**Harry Stebbings** [42:00]:

So we've now got this, like, exploded market map of Bolt adoption and very successful markets. Where are we at in our fundraising life at this moment?

**Markus Villig** [42:09]:

Still the same where we were back in 2014. You've only raised 1,000,000 at this point. So by that point, we had raised this 1,000,000 seed rounds, and then our metrics were just going through the roof. We were probably at that moment among, like, top two percentile in terms of startups, maybe in the world, but for sure in Europe. What are you at, revenue wise, at that point? At that point, we were easily crossing 10,000,000 ARR, probably growing 500% a year, and doing that with an initial budget of 1,000,000. When what year was this? I'm just trying to understand if I was investing. So that that was back in 2015, 02/16.

**Harry Stebbings** [42:39]:

Just at the start of my investing, frankly. I wasn't never met you. So okay. So we've got just raised this million. When do we go, shit. We need to raise a lot more money?

**Markus Villig** [42:48]:

So it was clear to us all the time that we need to raise more money because we were operating with always having a month or two of of cash in the bank. So it was always a huge stress for me, can I even make next month's salaries? Because Seriously? It was a complete disaster. So we tried to raise every way we could. So I met all the VCs around Europe I could get my hands on. I get to these meetings, show them the metrics, tell them the story. It was one of those cases where they were like, This seems like a great team. We've always left fantastic metrics, but we just don't believe in the category. Like, we think that you guys are gonna get wiped out. No matter how many of these meetings I took, and it was dozens, maybe even a 100, they all told us no. Did all the big brands

**Harry Stebbings** [43:25]:

say no?

**Markus Villig** [43:26]:

Every single one. What

**Harry Stebbings** [43:27]:

was their most common reason?

**Markus Villig** [43:29]:

This category is a winner take all market. There's not gonna be any room for number two, and therefore it doesn't matter how great your metrics are, we're not gonna invest. Which was the best meeting that you didn't get? I think that we actually didn't get the meeting with Sequoia back in those days. And that's another story of how then they later came back to the business four years later. Who was that meeting with? At Sequoia, we actually didn't get the meeting. That was the sad part. So we tried to approach them many times, and then back then I think we weren't an interesting enough company. Wow. Did you get a response? Yeah, we just got response that said, hey, like, thanks, but, you know, we're not interested in the category at the moment. Wow. Okay, so what was the Series A? So we took a very unconventional approach. So, first of all, we realized that we had to raise some money. We saw that all the sophisticated VCs didn't want to invest. So we had to swallow our pride and be like, okay, we need to raise money otherwise the company is going bust, and we need the money to continue this fantastic expansion. So I contact anybody I knew who had any sort of money. So I remember this one meeting was with a local real estate company in Estonia. So I go there, probably back then like a 22 year old kid, and they had never heard of a startup, had never heard of a tech company. And then I am teaching them about how our metrics are doing, what the story is going to be. Then And I remember at end of the meeting they were like, We have never invested in anything like this. We have never even done any investment outside of real estate. But you seem like a good guy, so we are going to invest $500,000 in the company. And looking back, it was completely insane that they did that. I mean, they invested at a valuation of about $15,000,000 So by now they made, like, easily more than 100x return on that investment. And the only reason they did was because they had never even heard of any of our competitors. So they just looked at it on the merits of the business. And that turned out to be much smarter than all the sophisticated VCs who turned us down.

**Harry Stebbings** [45:14]:

Oh my god. That's insane. So you turned 500 k into 50,000,000. Yes. Even more. That is insane. And so what did you raise in that kind of interim round? You cobbled together

**Markus Villig** [45:24]:

Yeah. So so we cobbled together 500,000 from this real estate company, similarly a couple 100,000 from a local railway operator, couple 100,000 from a local telecoms guy. So it was it was just this tiny altogether, maybe $1,000,000.

**Harry Stebbings** [45:36]:

And that was enough?

**Markus Villig** [45:38]:

Well, we had to survive with that. We had no other choice because nobody else wanted to back the company back then. So when did big cash come in? So then after that, the metrics were doing fantastic, probably got to the point of doing about 25,000,000 ARR, growing multiple 100% a year and still no VC's money to invest. So you just say, oh, for fuck's sake. I was just I just got so frustrated with this industry. I was telling like, I'm never going to talk to any VCs ever again. And then what happened was Was

**Harry Stebbings** [46:06]:

the experience bad?

**Markus Villig** [46:07]:

I think the experience was actually nice in a sense that they took the meetings, they listened, they were like, Yeah, you seem like a good guy. They tried to give me some advice. But at the end of day, I didn't need advice. What I needed was money. And none of them were willing to invest in the company at the time. So, and then it all changed very bizarrely when one day Mercedes or Daimler, the group approached us out of the blue. And the interesting bit was that all these OEMs at the time were trying to figure out what is their strategy gonna So they all realized that mobility is changing. Maybe one day everybody's gonna be ordering cars from these apps, and that's gonna completely kill their existing business. So Mercedes was the one who had a big fund to set aside. So they wanted to buy as many of these companies as they could. So they approached us and they tried to buy the business back then for maybe €100,000,000 which, obviously, as a young kid, would have been a fantastic outcome. So we discussed it with the founders, but my view was immediate that we don't want to sell the business. We're on to something special. This is gonna be an amazing business, so we're gonna turn it down. How much of the business did you have at that stage?

**Harry Stebbings** [47:08]:

Probably 45%. So you'd have made $45,000,000, say, at '22?

**Markus Villig** [47:13]:

Yeah. And we had a big debate about it with the other founders, like, what what do you what do you wanna do? And I was completely clear that I wanna build the business, and they got lucky that Oliver and Martin were both very supportive. So they were like, okay, it's your call. You started the business. If you want to go for it, go for it. So we turned it down in a day. We didn't even think about it.

**Harry Stebbings** [47:31]:

Wow, that is incredible. Was there anyone who did want to sell it?

**Markus Villig** [47:35]:

Well, there was obviously some of these angel investors who were like, Wow, we're going to get a great return of, whatever, 10x in a year, and this is going to be fantastic for us. But actually, they all were of the same opinion that you started the business, this is your call. If you want to go for it, take the risk. Okay. So we say no, and they then invest in the business? Yeah. And that was then the bizarre thing. So then a year went by, and our numbers just kept on growing. So we we probably quadrupled the business in the next year. And then we went back to them, and then they realized that we're gonna be the winner in this category in most of these markets. So then we managed to convince them that they invested more than $100,000,000 at the billion dollar valuation. So it went in a year from being an acquisition to being an investment. And that's turned out to be fantastic for them. You've gone from raising

**Harry Stebbings** [48:19]:

1,000,000 from, you know, real estate company, local telecoms people, not the standard, to a 100,000,000 from Daimler. That kind of fucks with your mind a little bit. No?

**Markus Villig** [48:32]:

Well, it was it was a huge transition. So we also, in the interim, had this interesting debate with the team internally, that what are we going to do with the money? Because we were doing already really well, and we didn't really need to fundraise. But what we saw was that if we do this fundraise and we're able to deploy it even nearly as efficiently as the past money, then we're going to be able to just quadruple the business very quickly. So it was clear to us that in order for us long term to have success in this category, we need to raise the money.

**Harry Stebbings** [48:59]:

That is insane that it was like one, one and a half, and then a 100. Absolutely. I had no idea about that. Yeah. It was a huge transition. When you get the 100, what did you spend on that you look back now and you're like, why did I spend that?

**Markus Villig** [49:14]:

Honestly, I don't think we really did anything wrong with the money. I think we generally spent it all really well.

**Harry Stebbings** [49:20]:

So Estonian. So

**Markus Villig** [49:21]:

so so we we had this super super clear moment, I remember, when we raised this round, and I mean, it ended up then there were some add ons, so it ended up being $170,000,000 round. So 100 of that from Daimler, and then a few other investors joined in. And I went to the team, and I like, hey, we're not gonna be changing the culture. So you can imagine, effective, like, we haven't raised any money. So we're going to keep on operating just as we have. Yes, we're going be hiring a bit more people, but it's not like we're going to be bumping everybody's salaries massively or everybody will get huge teams now. We're going to retain that similar cost efficiency ethos we've had from day one. And given that all these people had been in those in the sort of this tough period for many years, it wasn't a tough sell. They were all like, yeah, this is what makes us special. This is why we're winning. We're we're not gonna mess it up just because we raise around.

**Harry Stebbings** [50:04]:

But you now have a 170,000,000. Just in terms of, like, your execution from there, what changed?

**Markus Villig** [50:11]:

So what that mainly enabled us to do was just launch, first of all, significantly more markets at the same time, exactly as it was necessary to overcome this initial chicken and egg problem because, again, the setup costs in some of these cities can be absolutely massive. To get going in a city like London, you need to invest ballpark at least €100,000,000 to reach that critical mass. Otherwise, it's just not gonna work.

**Harry Stebbings** [50:32]:

Oh. What was the cheapest city to launch and what was the most expansive?

**Markus Villig** [50:37]:

The cheapest cities to launch were the ones we first did in the Baltics because they were tiny. It was half a million people, very little competition back in the day. So you could probably get them. So, I mean, Estonia, got going with $5,000. So and then contrast that with some of the biggest cities in the world where you need to invest tens of millions, if not hundreds of millions.

**Harry Stebbings** [50:54]:

Did the growth okay. So we then are in we're doing multiple cities same time. We've got a 170,000,000. Did the growth then just continue?

**Markus Villig** [51:01]:

Absolutely. So we then went from doing that 25,000,000 ARR to very quickly getting to a 100,000,000, 200,000,000, 400,000,000 ARR in just a matter of a couple of years.

**Harry Stebbings** [51:12]:

When you look at the growth profile of the business, I was brought up on this travel, travel, double, double. What was yours? Was it like one to five to 25 to a 100? How did that growth profile look? Just so I get an idea.

**Markus Villig** [51:27]:

So looking back, it was probably we went from 0 to 2,000,000 ARR in about eighteen months. Mhmm. And then from there, we went to about 10,000,000 ARR in the next eighteen months. We were 5x. And then we went from that to a 100,000,000 ARR in less than two years. And then we went from that to now we have 2,000,000,000 ARR in sort of the next few years. So it was extremely rapid exponential growth throughout this whole business.

**Harry Stebbings** [51:53]:

You're at $2,000,000,000 an ARR. Yes. Wow. Fuck me. That's a lot. That's more than I thought. When you get to that stage, people really start to take notice of you. When do people really start to take notice of you, do you feel?

**Markus Villig** [52:08]:

So there was a couple of changes that happened with the company at the same time. So first, we were just growing really well. So the numbers were so good, and we got so large that these investors just couldn't ignore us anymore. So we then started to also appeal to the financial crowd. So actually, the first financial investors who came to the business were huge top tier New York investors. So we raised money from the likes of D1 and Tarzana and some great New York funds. It was

**Harry Stebbings** [52:34]:

Just take me to that. You've only raised from Daimler and some telecoms and Reuters. When, like, you know, Dan Sondheim and D1 come in with a, hey, here, Markus, we'd love to chat, was that a very natural, normal process? How did that go?

**Markus Villig** [52:47]:

Actually, what I really liked about these New York investors was that they were very numbers oriented. So they really did very deep, very sophisticated analysis about the numbers, the market shares, the trends, and they really liked the story on top of that, but they were mainly invested based on numbers. I think with VCs it was that other way around. So the numbers were great, But they didn't really focus on numbers, they sort of focused on what they thought was sort of the narrative in the industry. And that turned out to be completely wrong. So all these New York guys who bet based on the numbers were the ones who now made a killing on this. So you raised from them. How much did raise from them? So in aggregate, we will now raise 1,500,000,000. So it's just been a mix of maybe 10% of that from strategic investors, and and the most of that from then European and then US based investors.

**Harry Stebbings** [53:31]:

So the emails that didn't get meetings from Sequoia,

**Markus Villig** [53:34]:

when did Sequoia come back into the fray? So then mid-twenty one, the company was doing extremely well, and we really had this explosive growth during COVID. So what happened was that the whole mobility industry shut down. So COVID hit, and in four weeks, we went from just massive, like, about 200,000,000 of revenues to losing 85% of that.

**Harry Stebbings** [54:00]:

What what do you do at this time, dude? That is, like, it's unprecedented. The last time was Spanish fucking influenza in 1917. What do you do?

**Markus Villig** [54:08]:

So COVID was this fascinating episode for us. So we were doing $200,000,000 of ARR. It dropped 85%. Every other company in this industry started laying off people. They laid off 30%, 50%, whatever they thought was needed for the company to survive. So I remember we had this meeting over a call with the top management, and we decided we're not going to do any layoffs. We're going to be the only company in the industry that's going to retain all of our people, and it's going be a huge gamble because we lost 85% of our revenue. And instead, what we're going to do, we will do a salary reduction to everybody for 20%, and then we're just gonna bet the company that in six months this is gonna go by. And because we're the only company that's keeping our team intact, we're gonna accelerate out of this faster than anybody. And we gambled the company on that. That turned out to be fantastic. So actually the team morale we got from doing zero layoffs while everybody else did was just such a massive morale boost that the people, like, were even opting in that some people did 40% salary reductions to get us through those next six months. What did you do in those six months? I mean, we all remember nothing happened. So we we did a couple of things. So first of all, we optimized every single thing we could in the business. We were already frugal going into COVID, but that really made us, like, question every single line of the P and L and we squeezed everything we could to make the business more efficient. The other thing we did was we really started preparing how do we come out of this much stronger than going into it. So we actually launched a number of markets. So we were setting them up, and it was great timing because all these drivers were low utilized. They obviously didn't get trips. There was no traffic going on. So it was very easy for us to get into these countries and sign up the drivers. They had no other alternative. And then what we did was that these markets So how

**Harry Stebbings** [55:50]:

are you actually doing that? Because you're not going into these markets in a travel ban zone signing up drivers. How did you get drivers who are low utilized?

**Markus Villig** [55:58]:

So so during COVID, actually, online ads worked really effectively. So we were just running a lot of ads, signing up drivers. Then once they signed up, we started calling them. And then they heard about the idea. They saw that this is a great platform, much better than the ones they've been using before. And the word just spread organically. So so we suddenly signed up hundreds of thousands of drivers all across Europe, all across Africa. And so we have these expansion moments. It lasted longer than six months. But not everywhere. So what was the key distinction was that some of these markets started opening up very quickly. So, for example, some of these Eastern European countries already three, four months later, by the summer of twenty twenty, they were already up and we saw volumes started to rebound. And then in other places like London, of course, it took significantly longer. But then what we did was we had this war room where effectively almost every day we came together and we looked at, okay, which are the cities which are opening up, which are the cities not. And then immediately when we saw a city open up, we had a blast of just investing marketing dollars and discount dollars into that. So we really accelerated out of all these lockdowns. And I think that's what every competitor missed. So we effectively came out of it with market shares that were twice or three times higher than the ones going in. How long did it take to get that 85%

**Harry Stebbings** [57:10]:

loss in revenue back?

**Markus Villig** [57:12]:

It actually happened very quickly. It was probably five or six months before we were fully back, and then we already started hitting new records after that. Wow. So going back to the Sequoia, and so then, what, Andrew Reed, like, drops you a DM? So we actually had the Sequoia team reach out. I think it was their European team. And what was completely different from every other VC meeting I've had before that was that they had done all their homework before. So we were just in the middle of raising a new round. They approached us. Said, They Hey, we've done all the homework on the company. We're not gonna be a burden. Share us some of the metrics. We'll come back to you in forty eight hours. I remember it was literally me having two calls with them, and a few days later, they come back, Hey, we're interested. We're joining the round. So they really lived up to their reputation. It was just fantastic execution from their side. How much did they write? Still to this day, Bolt is the largest ticket Sequoia has ever done into Europe. That's an amazing, amazing thing. And they did it in forty eight hours? Yeah. So the decision making process was incredibly quick. So from the moment I had the call with them to them getting back to me was forty eight hours where we're joining the round. And they'd that, what price round was that? So that was mid twenty twenty one, so it was probably 4,500,000,000 valuation. Wow.

**Harry Stebbings** [58:23]:

Okay. So we have that round. That's a very significant moment in terms of brand and validation for the company. Does having Sequoia as an investor change the structure of a company?

**Markus Villig** [58:33]:

I'd say that we were already doing so well that we didn't need any particular investor to help us accelerate the growth. We had a great model. We just had to replicate that in more places around the world. I think the unique bit that Sequoia brought to the table was especially the brand in terms of employees. So, specifically in Europe, I think there was a lot of people who suddenly saw the validation that, yeah, we've heard Bolt is doing well. But after Sequoia and some of these other great funds invested, it really put us on a map where some of these talented people finally made the decision to join. How do you

**Harry Stebbings** [59:02]:

respond to people who say, if people join because of a fund, they're the wrong people to join?

**Markus Villig** [59:08]:

You can have wrong people join for any reason. I mean, wrong people might join because you're paying them too much, or they might join because an investor in sort of came on board. I think you just need to have a great process for weeding out who are the people with the right values. Do you think you were good at hiring? I was horrible at hiring the first few years. So so the the story goes that out of the first 10 people I hired, I had to fire seven of them. So it almost killed the company. What did you do wrong? I was way too optimistic about people. Growing up, I just always tried to see the best in people, and I was thinking everybody who is going to join is going to be equally excited about the business. They will spend all their waking hours thinking about how to optimize it. Turns out that wasn't the case at all. And then

**Harry Stebbings** [59:50]:

What were they? Respectfully, were they not as hardworking? Were they not as intelligent? Were they not as ambitious?

**Markus Villig** [59:56]:

I think it came down to all of those things to some extent. Just we hire people without the proper vetting process in the first year. I was 19 years old, so I had no clue what I was doing. So many of these people joined with completely different expectations of what I had as a CEO. Looking back, I think it was actually a great exercise because I learned from that of which are the patterns you really want to find in people, which are the patterns you don't. And after that, I think we codified the hiring process to be much more specific. And then we had a lot of success with hiring in the years following that.

**Harry Stebbings** [60:24]:

If you could only have one quality in a candidate, what would that quality be?

**Markus Villig** [60:29]:

I'm still in the camp of intelligence, so I would rather get somebody who's very smart. It's fine if they work a bit less hours, but they make the right decisions. At least for our business, you you cannot compensate with hard work if you don't make the right decisions. Everyone says in

**Harry Stebbings** [60:42]:

Europe, the trouble is that we don't have people who've seen growth like The US before. Is that true, and where have you seen that if so?

**Markus Villig** [60:52]:

I'd say that it's very hard to find strong leaders in Europe who actually understand tech companies and who actually build organisations of thousands of people. That I agree with. There's just almost no tech companies of that size in Europe. However, when you think about all these other things, whether it's how do you do sophisticated marketing or how do you build large scale engineering systems, Those things, you can find plenty of talent in Europe. I think that either you can get people who worked in The US and come back here, or you can just learn about how the best companies do it and what are their best practices are public. So I I don't really agree that, like, you you cannot figure out how to do world class marketing or engineering from here. Today,

**Harry Stebbings** [61:27]:

would you rather hire great people in Europe who haven't seen it before, or bring people in from The US and then face that challenge of assimilation, culture, moving people?

**Markus Villig** [61:37]:

In our experience, what has worked significantly better is taking people, especially from Central And Eastern Europe, who are really talented, extremely intelligent, hardworking, good, trustworthy people, but they've just never had the chance to compete at a well scale before. They've always wanted to, but there was never a company in the region that they could join. And those are the people who've really built the company. And they're very loyal, they've grown with the company, they know everything, they've been here for years, and I think it's just a completely different mentality than hiring people into Silicon Valley, for example, who oftentimes might move on to the next thing two years later. So we don't have that kind of culture.

**Harry Stebbings** [62:11]:

Do you think that the European funding environment is poor quality?

**Markus Villig** [62:14]:

I think that it used to be very bad ten years ago, and it's significantly better now, but there's a lot of catching up to do to The US. In what ways could it catch up? First of all, we're just limited by funding. So one of the problems is that if you look at where is the money coming from into The US VC industry, there's so many more LPs, the big pension funds are putting money in, the university endowments are putting money in. And that's not really the case in Europe, so there's just, I think, far less capital available. Do you do you

**Harry Stebbings** [62:40]:

actually the show is successful now because I do argue back a little bit. I would argue completely the opposite. There is way too much money in Europe, and there are way too few opportunities. And the result of that is you see this concentration of capital into the few obviously good ones, and the prices are just fucking nuts. And, I mean, the amount of mediocre to poor large funds is insane in Europe.

**Markus Villig** [63:04]:

I'd say that for sure there's a self fulfilling prophecy in that as well, that, again, if you have enough capital available, then these companies can raise the money they need to actually compete with their US counterparts. And if the money is not available, then they're just gonna get outcompeted, not because in any way they would otherwise be a worse company, but just because they don't have access to the funding. And at least in our industry, have seen that play out many, many times where it's been very clear in the food delivery industry, grocery delivery, transport in general, where a lot of these companies from The US just have more funding, and that's the only reason they win.

**Harry Stebbings** [63:35]:

What would you most change about European funding then, other than more?

**Markus Villig** [63:40]:

I'd say that they also need to be more ambitious and be able to tolerate that some of these businesses take a long time to get to profitability. From what I've seen, many of these investors are just demanding profitability way too early before these companies actually get to a massive scale.

**Harry Stebbings** [63:54]:

Markus, I'm a 19 year old European entrepreneur. I know I look a little bit older. You're advising me. I've started this business, and I'm really excited about We're at a million in in ARR. Should I raise from from European VCs, or should I just go straight to The US? What what do you advise me?

**Markus Villig** [64:10]:

Now in 2024, there are good European available. So I would think that it's easier to raise from Europe, and these people can also help you recruit talent in Europe. However, if you want to go and your target market is in The U. S, then I would probably raise from U. S. Investors because they will help you with connections talent there. Do you really think VCs add value? I think there are some VCs who add value, but probably 80% of them just provide capital, and and that's that's it. When you look back

**Harry Stebbings** [64:37]:

now, what would you have done differently about fundraising?

**Markus Villig** [64:41]:

I would have likely gone to these New York funds much earlier. I think that actually I, at first, just didn't even think that they would be willing to invest in private companies such as ours. But actually, the moment we got to first meetings with them and they saw the numbers, they were really excited. And they think they could have invested in the business a year or two earlier.

**Harry Stebbings** [64:59]:

You've expanded well beyond the core category now. Talk to me about the decision to expand to other categories and how you thought about that.

**Markus Villig** [65:07]:

We always had ambition to build a replacement to your private car, and we knew that ride hailing alone is not gonna do that. Ride hailing is gonna be a huge business, but there needs to be automotive transport we're gonna offer on the platform as But the first five years, we were just having no resources whatsoever. So ride hailing consumed all of our attention, all of our money. And then probably in 2018, we, for the first time, realized that we actually have enough budget that we can take on one new bet. And then we debated internally along what is that going to be, and then we took a gamble on micro mobility. So we decided we were going to be the first ride hailing company in the world to launch electric scooters on the platform as well. And that was actually quite a controversial decision, both from the employee point of view, but also from some of the investors, because Why? They were thinking that, first of all, it's a hardware business, so it's very difficult. And second, you're gonna be cannibalizing your own very profitable ride hailing trips because there's a big overlap. About 40% of ride hailing trips in a lot of these countries are less than four kilometers long. So you're gonna be cannibalizing that and pushing people instead of taking ride hailing car to taking a squatter instead. And you will have much worse margins there. But our view has always been significantly more long term. We've always been thinking that it's great for us to cannibalize ourselves rather than let somebody else do it. It was very clear to me that this is gonna be the future. These electric scooters and bikes are gonna be everywhere. So either we can build that category and define it based on our rules, or somebody else is gonna come and they will steal our customers. And I think long term, if you build for the customer, you innovate on their behalf, you give them better options, I think they will reward you with their loyalty. That's always been our philosophy.

**Harry Stebbings** [66:38]:

Did you choose specific cities to launch micromobility in first?

**Markus Villig** [66:43]:

Oh, wow. That was a horrible experience. So so we we first launched it in in Paris, and the logic there was that it's a big city, people have high incomes, so it should be a great place to try it out. And it was a disaster. Like, honestly, micromobility in Paris is probably one of the worst places in the world to do it. Why? Because the rate of vandalism was like nothing we've ever seen. At some point, we were losing 3% of the vehicles every week because people were just stealing them, throwing them in the river, trashing them. It was absolutely horrible. So there was no way the unit economics were ever gonna work there.

**Harry Stebbings** [67:17]:

What do you so you just pulled from Paris?

**Markus Villig** [67:19]:

Yeah. So actually, it is a funny thing.

**Harry Stebbings** [67:21]:

Also, the competition, I remember this kind of, I don't know, five, six years ago, it was insane when there was I mean, there was Dot, there was Uber, there was You. I was like, oh my gosh.

**Markus Villig** [67:30]:

Exactly. So so we we saw the similar thing happening in micromobility as we had seen in ride hailing a few years before, which was that suddenly the sector went from nonexistent to suddenly becoming 10 companies, everybody raised tens of millions of dollars, huge competition. So it was a big land grab. But what we saw was that, all right, France wasn't working. We're thinking we have these quarters we've already bought. Let's give it a shot. Try it out somewhere else. And then for a while, we're thinking maybe let's try another relatively higher income city. But then at the end of the we're like, okay, let's try it out in Estonia. It's our home market. Let's see what's gonna happen. And then it just took off really well. It took off way better than it ever did in Paris. Consumer utilization was better. Why do you think that was? I think what actually what we underestimated that micromobility is just a category that will work in almost every city in Europe. And I think back then we were skeptical and we thinking that maybe people don't have money, they're not gonna be willing to pay for the convenience. But absolutely they were. Even in a place like Estonia, people were happily spending a couple of bucks to get where they needed a bit faster.

**Harry Stebbings** [68:30]:

Okay. So we have it working in Estonia. Then we slowly expand out with micromobility?

**Markus Villig** [68:34]:

Yeah. So so that actually was then the first city where we saw that unit economics really made sense. And then

**Harry Stebbings** [68:39]:

we were first Why are unit economics worse for micromobility than they were the core riding?

**Markus Villig** [68:44]:

Because, just fundamentally, the the pricing per kilometer was significantly lower. And on top of that, the margin we at least saw in the early days was much lower as well. What is the margin on it? So in good markets, you are maybe able to get to 20% contribution margins, but in bad markets, it can be negative. So it's not an easy business to make it work. And you've got a lot of logistics

**Harry Stebbings** [69:03]:

around charging and supplies, no?

**Markus Villig** [69:05]:

So we, today, are one of the few players that's fully vertically integrated. So we have our own hardware team. So we design our own squatters. We have our own team in China where we manufacture them. We then ship them to Europe. We have hundreds of warehouses. We then need to charge them, maintain them, put them on the streets, find the ones that are missing, the ones that have been stolen. So it's a huge operation. There there's more than a thousand people working on it.

**Harry Stebbings** [69:27]:

But you say this so casually. I presume you hadn't been to China before, given you hadn't been to Africa. And so how do you get a team in China making scooters for you? Like, what is that story?

**Markus Villig** [69:39]:

So so we actually got extremely lucky with that. So once we had this first traction in Estonia, and it was clear that this is gonna be a category we wanna do seriously. So

**Harry Stebbings** [69:47]:

that first one, you just bought a load of scooters from somewhere?

**Markus Villig** [69:50]:

Exactly. So we bought these nine Bolt scooters off the shelf, and that turned out to be a disaster. They weren't designed for sharing, so most of them broke down very quickly, and that's where all this narrative comes from that these scooters are not sustainable, because those weren't. So what we did was, we saw this first market work, and we had two approaches. Either we could buy more of this hardware that was just gonna break down, or we could take a long term view and be like, hey, let's actually design a scooter from scratch that is really built for this, that's gonna last long, that's gonna be very cost effective. But we had no idea how to do hardware. I mean, we were a ride hailing company, right? So we just tried to hire a team, and we got super lucky. So there turned out to be a team of about 10 engineers in Estonia who had been building electric vehicles their whole life. So that was their passion. But they didn't really get product market fit, so they were toying around building the first products, but none of them took off. So I went to them and they like, would you wanna join the most successful startup in Estonia? Like, we're gonna give you a budget. We're gonna give you a consumer base. Just build this hardware for us. Join the team. And it turned out to be fantastic. So the team joined. They're still all of them with the company now, five, six years later. And they're probably now in, like, the seventh iteration of hardware that they're building for us. So it just turned out to be a massive win win for both sides.

**Harry Stebbings** [71:00]:

Okay. So they're building the hardware. But, dude, you still have to go to China. Factory. You still have to get rent, get local employees. I I don't know what you have to do. That's, like, my basic knowledge.

**Markus Villig** [71:12]:

How did you do that? So we got lucky that this specific team actually had their connections in China that they've been working with for a decade. So we got this team on board. They told us, hey, we have the connections. We're gonna sort all of this out. So just give us the budget. We're gonna sort out the designs. We're gonna procure the hardware. And this was just a fantastic partnership. So they were How much money did you allocate to that? Because that's bit of a gamble. In the grand scheme of how much money we've raised, in general, it's maybe been about 10% of our total funding. But what it did was that it had this massive transformative effect on the rest of the business as because we bought these hundreds of thousands of 0.25 to the market, to hundreds of cities. We became overnight from being, having almost no presence in that sector, to becoming the largest micro mobility operator in Europe, still to this day. Nobody operates with such a big fleet in so many cities in Europe. How much market share do you have in Europe today? So the market's actually pretty roughly split between the top sort of four or five players. Like, of them has between 15 to 25% share.

**Harry Stebbings** [72:08]:

With an eye to the future, when we think about self driving, you mentioned it earlier, how does self driving factor into how you think? We're seeing Waymo all over Twitter. Mhmm. I've seen so many friends. Wow. This is like the iPhone moment. Mhmm. How do you think about self driving?

**Markus Villig** [72:22]:

So I remain optimistic that self driving is completely going to change the world. It's going to be one of the biggest opportunities for companies like us to change how millions of people live, how cities are designed, how we spend our time. It's completely going to be transformative. However, I don't think it's gonna happen anytime soon. So, when you look at these two tech trees that they're currently developing, they're both years out before making a service that's actually commercially viable, that's actually cheaper than a human driver, and one that actually meets regulatory requirements.

**Harry Stebbings** [72:53]:

Why?

**Markus Villig** [72:54]:

So, first of all, the tech is just really hard. You have these approaches that use end to end neural nets like what Tesla and Wave here in The UK are doing, and they think they're making great progress. But let's be honest, they're still years away from having a reliable service that can truly replace a human driver in terms of safety and the coverage of areas it can drive in. And then you have the other tech tree, which is what Waymo and Cursor have been doing, which is very different. It's much more expensive. You have significantly more sensors, like more LIDARs on the vehicle. And that sort of is getting to the point now where it starts to work as good as a human would or even better. But there, the costs are just so prohibitive. The costs are significantly higher than a than a human would. So it's gonna take them multiple years for the costs to come down.

**Harry Stebbings** [73:33]:

Help me understand that because I have a lot of friends in San Francisco now who say they go to work every day on a Waymo, and it is the same price or cheaper.

**Markus Villig** [73:40]:

Yeah. But there's a difference between price and cost. Google is one of the the wealthiest companies on the planet. They can keep on subsidizing millions of rides for a long time. That doesn't mean the cost structure is there. How long will it be, do you think? I hope that we're going to get to the place where the technology and the costs are sorted out over the next five years, and then it's probably going to be a couple more years after that for the regulation to to get sorted. Especially in Europe, I think it's going take a long time. If Italy hasn't even figured out the ride hailing regulation in ten years, wonder how long it's gonna be for them to update their self driving laws.

**Harry Stebbings** [74:10]:

What do you do then? You vertically integrate and buy them? You partner?

**Markus Villig** [74:14]:

Most of these companies, like Waymo, over the long term don't want to operate a car network. It's just too much hassle. These companies can build what they are fantastic at, which is building the software, and then there's gonna be companies like us that actually do the real world operations. Because I think most people underestimate how difficult it is to operate a million or 5,000,000 or 10,000,000 vehicles in hundreds of cities, comply with all the local regulations, collect the payments, deal with customer support, clean the cars, charge the cars, etcetera. I think it's sort of just a scale of complexity most people can't even fathom and they just hand wave and think it's gonna be easy. No, it's not. Not to mention the insurance, the financing, the procurement of the cars, etcetera, etcetera. Like, I think that ride hailing companies like us are absolutely gonna be pivotal for these self driving car companies to actually go to market.

**Harry Stebbings** [75:02]:

What is Uber better than you at today, and what are they worse than you at today?

**Markus Villig** [75:08]:

What everybody else in this industry who survives by now, there's about seven companies left. What they've been doing better than us is raising money. They've just all raised multitudes of of how much we have raised. Many of them have raised $5,000,000,000 some of them have raised 15,000,000,000 even $30,000,000,000 while we have raised 1,500,000,000 Are you profitable today? So our our story, as we started with, was that we were bootstrapping the company the first four Then we raised more than $1,000,000,000. We invested a big chunk of that over the last five years. And now we're returning back to profitability. But now it's our choice. We have a big set of markets that have been profitable for years. Why do

**Harry Stebbings** [75:43]:

you decide to do it now? You can continue to invest, continue to go for growth. What's the rationale for saying, let's go for profitability?

**Markus Villig** [75:49]:

So our priority, for sure, is still growth. A 100%. So there's no intention for us anytime soon to become a profitable company that would be paying dividends or anything like that. Absolutely the focus is growth. However, we have a set of markets where we've built out a fantastic category to position. We have millions of customers, the business is organically growing well, it's very profitable, and we're taking that cash flow and investing that into other parts of the group. So either we're launching in more geographies or we're launching new product lines. And we think we're gonna keep on doing that for the next decade. What product line do you not have that you would like to have? So we already operate five, which is a lot for almost any company. Most companies can't even get one business line to the scale that we do. So we we do ride hailing, we do scooters and electric bikes, we do car rentals, we do restaurant delivery, and we do grocery delivery. So it's already a full set of products in dozens of countries. Can I push you?

**Harry Stebbings** [76:40]:

What's the smallest revenue makeup?

**Markus Villig** [76:42]:

So the smallest today is is still our car rental product. Why do you do it? Because we we have a lot of conviction that long term, that's gonna be a multibillion dollar category for us.

**Harry Stebbings** [76:53]:

Why? Because shit incumbents? Shit incumbents. So

**Markus Villig** [76:56]:

as as most people have interacted with these old school car rental companies, I don't think anybody is very happy with the experience. And I think that's even the small view. One current segment of the market is that people get out of the airport, they need to rent a car for a couple of days. Sure, that's an exciting category and we're looking at ways how do we make that experience better. And similar to ride hailing, we don't expect we need to operate all of this ourselves. We think we can partner with those companies, give them the tools, give them our operational know how and improve the experience. So that's one. But the other thing is that I think we need to be way more ambitious than that. And it's like, how do you actually create a new version of effectively Zipcar, which is that you can just rent these cars in a city on demand, just walk up to them, open them up with a tap and you can actually get a ride. So that is the category we're way more bullish about. And it's already working fantastically in about 10 cities now in Europe, we're just scaling that up. So what are you nodding?

**Harry Stebbings** [77:46]:

Say if you were to add a sixth, what would you like to add as a sixth?

**Markus Villig** [77:50]:

We have this wish list of probably 50 ideas that we're looking at every year and thinking about what are we gonna launch next year. So the one I'm currently bullish about is dine in payments. In many parts of Europe and the world, it's actually not a common thing that you can scan a QR code, you see the menu, you can order and pay from that. And you can integrate it with everything else we already do in the Bolt Food ecosystem. So you can have a loyalty program there that's all attached to that. So whether you do food delivery or you do the dining experience or any of these sort of food related services, they can all tie into a really nice holistic ecosystem. So that's what we wanna build next.

**Harry Stebbings** [78:24]:

Oh, it's fucking hard. I've done the scan to pay investing before. It's a This is why you hate European VC. It's a bad business.

**Markus Villig** [78:32]:

And I think that's one of these things that what Bolt is good at. How do we turn these bad businesses into actually good businesses through just a level of cost efficiency that none of these other companies can match? Someone said to me the other

**Harry Stebbings** [78:43]:

day, the heaviest things in life are not iron or gold, but unmade decisions. What's the biggest unmade decision for you that weighs on your mind?

**Markus Villig** [78:53]:

Actually, there's probably no single decision that I regret that we haven't done. I think it's rather that there's been multiple decisions that I would do differently if I could. What's the biggest? Probably we should have been even more aggressive in our expansion. So if I look back at this period we had from 2015 to 2019, where we launched all of these markets remotely, it was a fantastic time. I think what we did back in 2019 was that we started raising these bigger rounds and we were getting this external advice that, Guys, you need to get more professional. You can't keep on launching markets like this, running Facebook ads and hiring people over Skype calls. Like, you need to have more rigor and more process around it. And it was one of those rare times where I actually listened to that advice. And then I think we slowed down a bit on expansion, and we doubled down on existing markets, which had its merits. But I think what it meant was that in some parts of the world we left a vacuum for other competitors to fill in and actually take meaningful share. So looking back, I think we missed out on a great opportunity there if we had continued in that startup mindset for a bit longer.

**Harry Stebbings** [79:53]:

This has been such an amazing story. I want to do a quick fire round with you. So I say a short statement, you give me your immediate thoughts. What do you believe that most around you disbelieve?

**Markus Villig** [80:03]:

I think the most contrarian view that I have not seen any investors really buy into so far is that these ride hailing companies are really gonna be the best way for these self driving cars to come to market. From what I've heard from most people, they think that these companies are gonna build their own operations, and companies like us are gonna get somehow squeezed out of the market. I think these people just have no idea about the complexities involved and how difficult it is to scale a ride hailing network such as this.

**Harry Stebbings** [80:28]:

I think when you don't do the work, it's difficult to know how hard it is.

**Markus Villig** [80:32]:

We've been building this for eleven years with human drivers, and that's already hard. If you add sort of the complexity of managing this autonomous operation and cleaning the cars and charging them and so on, I think it's only gonna get more difficult.

**Harry Stebbings** [80:44]:

What's been the most lavish purchase then you've spent on?

**Markus Villig** [80:47]:

I'm a very frugal guy. I don't even have a driver's license. So the most expensive thing I've bought is probably in my apartment in Tallinn. Probably still cheaper than anything you could get in London. Does money make you happy? Absolutely not.

**Harry Stebbings** [81:00]:

What's the reflection on relationship to money?

**Markus Villig** [81:02]:

You need to have some base level of money to take care of your daily needs. Absolutely. And to that point, I think it makes a big difference to your emotional health. But after a certain point, what I get most of my excitement from is actually seeing the company do well and actually see the people around me do well. So the reason I come to the office every day is because I genuinely think we have a world class team. And seeing those people who started in the company as basically interns, and now they're running hundreds of people's organizations, It's just fantastic. So that's what gives me the most joy.

**Harry Stebbings** [81:31]:

What have you changed your mind on in the last twelve months?

**Markus Villig** [81:34]:

I was actually at first very skeptical of AI. So I Why

**Harry Stebbings** [81:39]:

were you skeptical of mine? Did you change your mind?

**Markus Villig** [81:41]:

I started using ChatGPT when it came out more than a year ago, and there was a lot of buzz about it. And all these CEOs were coming out saying, like, how it's going to transform their companies. And on one hand, a big techno optimist. But on the other hand, I tried it out. I asked a bunch of people in the company, tried it out, see how it can optimize their work, and it came back very negatively. Like, nobody really thought this was to move the needle, with the exception of one part of customer support. And that was generally the one part that I was thinking optimistic this is going to move. But now I think in a year, my thinking has switched significantly, both on a personal level and on a company level. So on a personal level, I now use these LLMs basically every day. Do you use? Actually, a mix, so both Anthropic and OpenAI. Publicity? Very little so far, actually. Generally And prefer the other

**Harry Stebbings** [82:27]:

then for the team, it's changed as well?

**Markus Villig** [82:28]:

Yeah, so for the team as well, so it was clear that customer support, it's gonna be great. You can automate the meaningful percent of work and make the customer experience better. But I think it's also become more obvious to me that you can actually expand that to significantly more use cases, whether that's something like a CRM. So how do you make your sales reps and marketing people more effective? Or it might be internal tooling, like how do people in the company discover information more easily? How do you, for example, summarize documents and make better decisions? So I'm getting more and more optimistic you can actually apply it in those domains as well.

**Harry Stebbings** [82:59]:

What concerns you most in the world today?

**Markus Villig** [83:01]:

Clearly, war. I think that there's a lot of things going on well in the world of technology, but I think it's absolutely insane that we have a war going on in in Russia attacking Ukraine, killing people, and everybody's just basically forgotten about it. It's it's absolutely crazy.

**Harry Stebbings** [83:16]:

Yeah. I do agree with you. It's amazing how it normalizes so fast, as awful as that sounds.

**Markus Villig** [83:20]:

Exactly. I mean, the war's been going on for two and a half years, you know, you ask most people in London, they don't even think about it.

**Harry Stebbings** [83:26]:

You're a fit dude. I've known you for a while. You're a fit dude. What's the health or diet advice hack that not many people know about and that you think is great?

**Markus Villig** [83:35]:

Honestly, I think people should just do the basics. Like, that's the most contrarian take here, probably. Like, everybody's trying to innovate and biohack and whatever. Like, most people just should just take the basics really seriously. Sleep eight hours a day, eat healthy food, exercise a couple of times a week, take a few hours off, enjoy time, read books, chill with friends, whatever works for you.

**Harry Stebbings** [83:55]:

Just most people don't do it. When have you been most out of kilter in the Bolt journey? Well, like, you're sleeping like an hour a night and it's just your health is shit.

**Markus Villig** [84:03]:

Literally never. Over these last ten years, I've never sacrificed sleep for the sake of the business. I've always thought that's going to be a bad idea. I'm just going to be ill tempered the next day. I'll have worse memory, worse decision making. So I've always taken it very seriously. I always sleep well and look at this as a marathon.

**Harry Stebbings** [84:21]:

God, fucking Estonians. You're always so calm and, like, methodical in what you do. Final one. What question have I not asked that I should have asked?

**Markus Villig** [84:31]:

Most people still misunderstand how all of these on demand marketplaces are going to work out. I think that that's been the bizarre thing to me. So I was always been this contrarian in this industry for eleven years, telling everybody that I think all of this M and A in this ride hailing industry is complete insanity. You should not be doing that. And, again, still to this day, I think most people wouldn't agree with that. Why is it insanity? This is fundamentally a duopoly industry. This is an industry that, at the end of the day, stable state is going to be two players splitting the market, one way or another. And whenever the top player pies the other one, they buy themselves a couple of years before somebody else comes in and takes that second player spot as well. So you're back to square one. And we've seen time and time again how companies make this mistake. They do this merger. They think it's gonna be fantastic. They model out these monopoly returns for a long time and it never pans out. And just I don't understand why companies keep on making that mistake.

**Harry Stebbings** [85:25]:

I totally agree and love that. So what is the future of these marketplaces?

**Markus Villig** [85:29]:

I think that most of the world has already stabilized. So if you look at this industry, barriers to entry now are so high. The technology, getting places like London going requires such a massive need of capital that nobody is willing to fund in this new environment. So I don't really think that there's going to be new competitors entering the market in a traditional sense. I think where this innovation is going to come from is new modes of transport. Either it's going be something new like electric scooters or it's going to be self driving cars, but I think it's going to be a completely different thing that's gonna shake up the market, not the existing companies.

**Harry Stebbings** [86:00]:

Markus, I do the show for shows like this, which is said to you before, I think art and science, the story combined with the lessons. Thank you for being so brilliant because it reenergizes me and my love for what I do by doing shows like this. Awesome. The Bolt journey is one of the greats. If you wanna see the full episode on YouTube, you can check it out by searching for 20 VC to see Marcus in the studio live. Now before we leave you today,

## Sponsor read

**Harry Stebbings** [86:25]:

I wanna share something interesting about the private market. There are many ways to buy and sell private stock today, but HIVE is the only platform that provides a one stop liquidity solution for private companies and their shareholders. It not only provides access to a deep pool of investors, but also allows companies and boards to control elements like buyer approvals, seller eligibility, and even pricing, offering liquidity on their own terms. What's more, HIVE's comprehensive transaction execution service and centralized transaction tracking allows companies to stay on top of all past, pending, and upcoming transfer requests effortlessly and at no cost. Visit HIVE dot com, that's HIVE with two i's, and see why they're the fastest growing liquidity platform in the world. HIVE Markets Limited is a broker dealer and member of FINRA, meaning investments in private stocks are risky and only in credited investors may buy through HIVE. And just like HIVE transforms liquidity, Tekus transforms how we gather insights for investing. When I invest in software today, I think software is valuable when it saves time and makes something easier. But when it enables the user to do something they simply could not do without it, then it's insanely powerful and valuable. That's the case with Tekus. I literally could not live without them. When I'm investing in a company, Tekus lets me see the most incredible reference calls with experts in a space who work at a competitive company or incumbents. These calls and data provide the most incredible insight that really shapes my opinions and thoughts and investment decisions, and I can then share snippets from calls with team members. This is a tool that will change how you work. Honestly, you cannot imagine life without it once you've experienced how powerful it is. And you can check them out today by heading over to tegas.com. And just like Tegas, HMC helps bring powerful ideas to life. Here's a great opportunity for all visionaries out there. Harvard management company is constantly seeking out the next generation of great investors and entrepreneurs. HMC has managed Harvard University's endowment for nearly fifty years and was one of the first institutional investors in venture capital. Their experience and long term investment horizon make them ideal partners to get world changing ideas on a path to viability and success. They work as a true partner, providing insightful perspectives to help managers succeed. I personally have had the immense pleasure of working with the HMC team and can say that they are truly exceptional partners and savvy investors. Whether you're launching your first fund or your fifth, fifth, HMC welcomes the opportunity to partner with both developing and established managers. Have an idea you wanna share with the team? Send it over to venture@hmc.Harvard.edu. As always, I so appreciate all your support, and stay tuned for an incredible 20 growth this coming Friday with the head of growth at Perplexity.