We were lucky enough to be featured in the July/August edition of Private Equity Magazine, alongside some key members of our wonderful investor community and our fantastic entrepreneurs. Click here to read the original in French, or read on for our translation of the article into English…
OneRagtime, the bridge between business angels and beautiful projects
The OneRagtime platform curates a community of qualified investors and promising start-ups, offering investors the opportunity to invest à la carte. Built to support early stage software start-ups, the platform, headed by Stéphanie Hospital, applies the same digital rules to its start-ups as it does to itself.
OneRagtime puts itself between venture and crowdfunding. Launched in 2015 by Stéphanie Hospital and Jean-Marie Messier, the platform offers a new service, connecting investors and digital start-ups. “We started from a blank page”, recounts the founder, “we noticed that there were high numbers of people wanting to finance start-ups, but that these people didn’t have access to entrepreneurs. We also noticed that only a few business angels can participate in each top project. So, we designed the platform for these people to meet each other.”
A superb network
Today, OneRagtime consists of a venture cloud built up of 500 investors. Some investors come from private equity, such as Patrick Sayer and Virginie Morgon of Eurazeo, or Jean-Luc Allavena (Apollo), while others come from the business world such as Bernard Mourad (ex-Morgan Stanley, Altice). Some are entrepreneurs: David Amsellem, founder of the concierge service John Paul, or the Saadé family (CMA CGM). The tech guru, Philippe Bourguignon, is OneRagtime’s “godfather”. The founders have leveraged their networks to bring together this following of qualified investors, who have access to the deal flow via the website and OneRagtime’s mobile application. They can invest according to two models: either they decide to invest in all the projects, or they invest à la carte, which avoids any conflict of interest. The funds raised by the team come in the form of one or two million euros on average, with contribution of at least 100,000 euros per project. The funds are then invested in a regulated vehicle, allowing investors to avoid an imposed liquidity event while benefitting from all the normal VC terms, including a place on the board.
An original model
The second component of the platform: the start-up studio. “We like to arrive early in the projects, after the PowerPoint stage, but as the first professional investors for entrepreneurs, when there is already a visible product or service with its first clients”, outlined Stéphanie Hospital. “We are very sensitive to the international DNA of a start-up and we favour those which are built on software models that are not too capital intensive.” The OneRagtime team make their own due diligences and always follow the next funding rounds in order to participate under the best conditions. Their developers and data scientists make the technological due diligences, and they complete financial and legal audits, systematically checking the intellectual property. The deal flow comes from physical meetings, pitch-decks received directly to the platform, from recommendations made by other entrepreneurs and also from their network of investors. Once an investment is completed, the team actively accompany the start-ups, notably in business development, thanks to their connections to big corporates. OneRagtime also provides support for financial and commercial structuring. And of course, the investors can take on the role of mentor to the start-ups.
Without the pressure of capital to invest, OneRagtime dedicates a lot of time to the selection of entrepreneurs with strong personalities. So, it’s no surprise the team fell in love with Taïg Khris, former world rollerblading champion. Now converted to entrepreneurship, he founded a telecom start-up, onoff, which recently announced its 10 million euro fundraising, in which OneRagtime took part. Another investment, Make.org, is led by serial entrepreneur Axel Dauchez, ex-CEO of Publicis France and Deezer. This civictech offers up petitions to the public and monitors the subsequent commitments made by public figures. The model is profitable thanks to the awareness campaigns lead by Make.org’s partners. In the fintech sector, the team chose Marie Quantier, an application which recommends multi-asset investments to its clients thanks to Marie Quantier’s artificial intelligence. Still in AI, OneRagtime also supports Gestoos, a Catalan start-up which allows cameras to understand even the smallest of human movements. Gestoos’ technology has multiple applications, and has been adapted, most notably, for the automotive industry, with contracts also signed for FC Barcelona, Adidas and Philippe Morris International. In each of these deals, OneRagtime expects to wait for five to seven years for an exit, with a hoped-for three to five time return on the investment. To date, the platform already counts one exit, with the sale of the geolocation application Zenly to Snapchat for 215 million euros.
Developing tools in-house
The team is not afraid to inject tech into their own model. The investment process is digitalised to the max (signature, payment, etc.): “We rely heavily on technology ourselves in order to be the most efficient and to offer an excellent user experience during the investment process”, explained the CEO. “We are also constructing data models to improve our project analysis, and for this, we’re using information collected on 50,000 tech organisations such as fundraisings, valuations and turnover. We apply a holistic approach thanks to the data. “This database is also a way to monetise our consultancy activity. What’s more, OneRagtime makes connectivity resources such as OVH, Amazon and Paydrive available to all its start-ups. Connectivity is of course fostered too between the diverse members of the team, composed of over 20 people; millennial geeks, successful entrepreneurs and mentors, spread across Paris, London, and more recently, Barcelona.
Top M&A resources
Jean-Marie Messier contributes to the OneRagtime project in several ways. The co-founder opens up his address book and offers his advice to OneRagtime’s start-ups. The platform offers to build up new channels for business between start-ups and big groups, advising on late stage fundraising, M&A opportunities and IPO. In essence, OneRagtime balances its business model between management fees, performance fees upon a start-up’s exit and consultancy services where they monetise their data. The next development in mind: to convince corporates to become entrepreneurs: “I’m building OneRagtime at the same time that the start-ups we’re financing are building their businesses too,” concludes Stéphanie Hospital.
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