Bogdan Axinia has been with the eMAG Group, the e-commerce market leader in Romania, for almost a decade, but 2020 found him in the eMAG Ventures managing director chair. He is a fast-tech innovation leader and is now looking to bring his knowledge and the group’s capital to the region’s startups and scale them sustainably.
eMAG Ventures is eMAG‘s group CVC and is present in Romania, Bulgaria, Hungary, and Poland. The group is 70% owned by Naspers, the largest technology investor in the world, based in Cape Town, South Africa. It invests in B2C and B2B businesses in the e-commerce, fintech, healthtech, and circular economy verticals.
Bogdan Axinia shared with The Recursive that both Naspers and eMAG are looking for companies in emerging areas with strong entrepreneurs that can lead the startups into the exponential future.
The Recursive: What influenced eMAG to develop eMag Ventures?
Bogdan Axinia: It started gradually. We invested in the past in different companies, but it wasn’t a formal process. We saw the opportunity in good entrepreneurship, the project’s potential, or we needed their solution, but we didn’t scout for new companies. There was synergy when we made investments. We invested in projects to transfer them our business, operation knowledge, technology, and human resources.
What has eMAG Ventures invested in since the beginning?
Sameday and Tazz by eMAG are two examples that grew exponentially when we joined forces. The first is a logistical courier company and the other one offers food delivery. We are looking to invest in Romania, but also Hungary and Bulgaria. In Hungary, for example, eMAG merged with Extreme Digital.
We are looking for entrepreneurs that will run the business, who know the market, and who can stay in the business and grow it. This is also a Naspers’ process. Founders must stay in the business.
Are you looking to develop your portfolio in a specific niche?
We are focusing on the niches we have experience in and where we could help the new startups. We are interested in B2C and B2B2C businesses because this is what we know. It’s also important to be backed by technology because we strongly believe that it could help scale the business. We are also looking at some verticals, like fintech, healthtech, and companies that offer a circular economy model. We are interested in solutions that could help our core businesses, like Sameday or Tazz, even eMAG.
What do you look for when deciding to invest in a company – is it the product or the team?
We look for all these aspects. Of course, the most important part for us is the team. It has to understand the market, have the drive to succeed, and dare to go further. We are also looking at the product and what is the market that it could address. We saw teams with great products, but we didn’t see what we could bring to the table, besides capital, so we didn’t invest because it wasn’t our area of expertise, and it was something that we could not bring much value to.
What phase should the startup be in for you to invest in it? Do you need proof of concept, specific results, or feedback from clients?
We are generally looking at companies that are at the revenue stage and have paying customers. We don’t have the expertise to help companies that are at a pre-seed level. There are great accelerators, VCs, and angel investors for that.
How do you see e-commerce’s evolution in the next three years?
This year was good for e-commerce because a lot of people tried it for the first time and they saw the value it brought to them. It was good growth, but there is still room to grow.
From a customer’s perspective, we are looking to understand his or her needs and address them. We want to get a product faster for them, have many things they could choose from, be clear, and develop different payment methods for free.
In the fashion niche, we did something called “magic return”. You try on different products, you put in the locker what you want to return, and you get the money back instantly, in a few seconds after you close the locker. We are doing these things to grow the e-commerce experience for our customers in all the countries that we are present in.
Are you looking to develop your tech solutions or rather look for startups to offer the solutions?
It’s a mix. In the past, I managed the platforms in the Technology Department, which has between 700-800 people who are working to develop our technology stack, adapted to our needs. But we are looking at companies that could help us with different niches.
Where would you like eMAG Ventures to be in the next few years?
I would like to find a few companies that could have a €1B valuation. So, we are looking at companies that could reach this. I would like to stay beside some great entrepreneurs and projects that could bring value to the ecosystem, for the customers and the employees.