How to gain business respect? Toil and sell the company for hundreds of millions

When Ondřej Fryc turned forty, he sold a majority stake in the Mall.cz e-shop to the South African group Naspers and collected billions of crowns. It was 2012 and he had been paying for one of the most visible figures of the emerging entrepreneurial generation for some time. “I felt good when people wrote about our company and me personally. It stroked my ego, which grew and grew.” he confessed now in a personally tailored comment on the blog of his investment fund Reflex Capital. In the text, he warned other startupists, as well as the media that follow the scene, to focus more on work than on their promotion.

Reflex Capital is one of the most successful funds on the Czech and Slovak venture capital scene. After all, last year Ondřej Fryc and spol. they also took home an investment hit award from the Startup Awards event organized by CzechCrunch. It was for their successful bet on Smartlook, which was bought by US software giant Cisco. Fryc himself is a sought-after respondent who evaluates, for example, the situation in the economy in the media.

As someone who has already built and sold one large e-commerce business (even twice, because in 2015 Mall.cz, in which Fryc was still active and continued to hold a minority stake, was acquired by internet entrepreneur Jakub Havrlant), can have a greater exposé in allow public space. After all, he is not the only one, recently a number of other representatives of the new economy have been making themselves known more and more: for example, Jan Barta from Pale Fire Capital, Martin Vohánka from Eurowag, Y Soft founder Pavel Muchna and Jakub Nešetril, who launched the Česko.Digital project.

However, as Ondřej Fryc writes in his column, it is good to be wary of those who mentor, coach and advise without having yet achieved anything fundamental with their startups: “Suddenly, he starts to feel the need to prove his greatness to those around him through articles in the media. And someone goes even further, starts to act as a mentor for startups, starts going to conferences to give out wisdom, without really being able to do anything himself. He glosses over everything on Twitter and is addicted to the dopamine boost every time someone clicks a like.”

He adds that at Reflex Capital, they pay attention to entrepreneurs who bet a lot on their own self-presentation and perceive their excessive media activity as a warning sign. “Does the founder still have any self-reflection? Is he doing it for the company or for his cult of personality? Is he able to make decisions without the ‘what will they say…’ filter? Does he even have any time left for business?” he asks in his column.

But according to Fryc, all this is only the beginning, and if a businessman or businesswoman thinks a lot about his image, it does not necessarily mean that something is wrong with the company. It says more about the startupist himself and his dedication to the company. On his investment path, however, the founder of Mallu also encounters the fact that, in order to attract external capital and attention, some people even begin to lie. And that’s usually a problem.

“It starts innocently, the facts are bent, the full truth is not told, words are played. A classic game of PR consultants. But then, under the guise of ‘good PR is important for my company’, he starts lying outright. About last year’s turnover. About the number of customers. About the size of the investment, about the valuation. No one is going to check that anyway, right? But hey,” writes Ondřej Fryc, saying that when such businessmen come to him, he is usually already ready: “Perhaps even before the meeting, where the founder could somehow explain it, he (the investor) will come to the conclusion for himself that so much money has already been burned there at such a high valuation that it makes no sense to be interested in it at all. Then such a bombastic article on CzechCrunch two years ago will be quite expensive.”

In his last sentence, Fryc, who as an investor has supported projects such as Rekola, Productboard, Keboola or Shopsys, points out that the media also play an important role in the entire startup ecosystem. And sometimes they play the role – unwittingly or unknowingly – of insufficiently critical bullies, including CzechCrunch.

So what is the main message a well-known investor has for budding entrepreneurs? What does he think is the best way? Unsurprisingly, honest work topped off with a successful, perhaps hundred million, sale of the company: “You don’t get real respect from others through media coverage. You get it through your reputation. And this is mainly formed by actions and is formed over a long period of time. It is formed not by how you present yourself, but especially by how those who know you personally speak about you. And finally, if you dedicate yourself to your business and make a 9-digit exit, you will be written about everywhere without you having to worry about it.”

CzechCrunch approached Ondřej Fryc with the question if he would like to write a blog post entitled Show offwhich was the first in a year and a half, was inspired by a specific story, a specific startup or perhaps a bombastic mention. “Of course there were more inspirations, but I wouldn’t want to name anyone in particular,” he replied.