The startup ecosystem in the province of Alicante is taking off

The startup ecosystem in the province of Alicante is taking off, as demonstrated, among other things, through investment. Business angel Pablo Fernández is the co-founder of Clicars and Clikalia, among others, and during 2022 he has invested in the Alicante startups GDV Mobility and Gravity Wave and in others such as We Are Knitters. His experience also involves investing in firms such as Creditas, a unicorn with a valuation of more than 4.8 billion dollars; Olapic, acquired by Monotype for 130 million dollars; and Leandrock, acquired by WiZink, among many others. Fernández spoke with us to assess how 2022 has gone from an investor point of view, to discuss the recently approved Startup Law, and to see the Alicante startup panorama and possible new large-scale operations in 2023.

How has 2022 been for business angels investing in emerging startups?

In 2022, investment in Spain halved, from 4,000 to 2,000 million. The second half of the year was a worse time for entrepreneurs, although good for investors. It is true that last year meant a rationalisation of investments because valuations were very high and there was free money for a long time. Now there is optimism, and the crises helped separate the good companies from the bad ones. In the province of Alicante, it can be seen that there are growing, profitable companies that are not so exposed to the noise of the situation in Madrid and Barcelona.

The Startup Law has just been approved. How does it affect emerging companies from the point of view of their viability and financing?

There are several points to take into account. The law improves on what was previously in place, which is a good thing. Of course, the signal that we need a startup law means that there is a problem, because commercial law should suffice. Thus, now, without being at the level of the best ecosystems, the standard represents an improvement, and we must be grateful for it. For example, the tax deductions for business angels, which are an important aid, or the change in the tax regime for stock options

In 2022, you invested in the Alicante GDV Mobility and Gravity Wave. In what quantity, in what way, and for what purpose? What stands out about each of these Alicante startups?

I see a lot of potential in Alicante. Although Madrid and Barcelona receive 70% of startup investment capital, Alicante is a large city off the radar that I am familiar with, having lived in the province for ten years. I have made a change in my investment policy. For example, in GDV Mobility, I have started to participate at 21%, and at 16% in Gravity Wave. They are startups that generate a positive Ebitda, are profitable, and grow at triple digits. In addition, they have very young entrepreneurs at the helm and invest in projects with impact. Sustainability is essential for a new generation of entrepreneurs. Although in many cases the participation of business angels in companies is usually passive, in this case, my participation in these startups is extensive, with entry into the boards of directors and meetings with them every week. I like to concentrate investments in fewer projects with more involvement. In a way, I also become a mentor. The Alicante startups in which I have invested have a great future. In them, I find businesses to contribute, and entrepreneurs who listen to a consolidated and profitable plan. GDV Mobility will open a factory with the capacity to recycle 500,000 batteries, and Gravity Wave has a double impact, in Alicante and the Mediterranean. I was born in Calp and am now active throughout Spain through agreements with fishermen’s associations and companies. The first year of life of a startup is a good time to help grow with investment rounds and hiring managers. From my experience, I can do it, and I really enjoy that role.

How do you assess the evolution of the startup ecosystem in Alicante? And in general, in the community?

Valencia is well known and consolidated, and, in fact, I have invested in many projects there. Meanwhile, Alicante advances with good valuations and good entrepreneurs. I think it is appropriate not to rush and only make one or two good investments a year in Alicante, which I believe will be the next Malaga. I have that vision. As president of Clickalia, I verified the real estate potential. There is going to be a boom. The Alicante province also has the potential to attract and repatriate talent.

What horizon does the year 2023 expect for investment in startups? Are new large-scale operations in sight that could cause new unicorns or million-dollar purchases?

Nobody knows. It’s curious. Investment has fallen, and in the first months of 2023, it will be difficult. But there are funds loaded with money to invest. There will come a time when the money will arrive—we don’t know if at the end of 2023 or a little later—and suddenly the whole world will want to invest. What I say to companies is that they should prepare; they should do their homework so that when that rain of millions arrives, they are at the right time and place. You must position yourself to be profitable while also improving your products.

As co-founder of firms such as Clicars and Clikalia, what advice do you offer new entrepreneurs to achieve success in their projects?

Put the focus on large sectors that are not well served and that are poorly digitized; focus on the customer and profitability. What you have to do is sell. Focus on selling, focus on clients, and prioritise the money that is available, even if it is little.