When Nicolas Brusson graduated from one of France’s prestigious grandes écoles with degrees in engineering and physics at the height of the tech boom in 2000 he did not even know what venture capital was.
“I knew nothing about start-ups, I was a pure technical guy with no business training,” says Brusson, a scheduled speaker at LeWeb, an annual international Internet conference in Paris. Then, “I moved to the U.S. to get a PhD and I arrived in this crazy environment of Berkeley and San Francisco.” The idea of helping to build a fast-growing company sounded intriguing; he took the plunge, joining Gemfire Corp., a 30-person start-up in Palo Alto, that specialized in photonic integrated circuits.
Six years in Silicon Valley, including the near-death and rebirth of Gemfire, steeped him in the culture of entrepreneurship and taught him the importance of scaling fast through “acqui-hiring,” says Brusson, co-founder and COO of BlaBlaCar, the Paris-based global inter-city ride-sharing service that has become one of Europe’s brightest tech stars.
Not long after Brusson joined Gemfire, the Silicon Valley company raised $85 million in venture capital from Kleiner Perkins Caufield & Byers, Intel Capital and other venture firms and added 120 employees. But after 9/11 Gemfire went bankrupt. “I learned about the dark side: Chapter 11 and laying off people,” recalls Brusson. He and the nine others who remained decided to refinance the business, acquiring a company in Scotland and another in southern California. It was a way to add talent and expand reach quickly, an approach that Brusson has replicated at BlaBlaCar.
By 2006 Gemfire was back to 150 employees and selling to clients around the world. At that point Brusson returned to Europe to earn an MBA from the Fontainebleau-based business school, INSEAD. It was there he met Frédéric Mazzella; their friendship was to prove crucial to the future BlaBlaCar.
The idea for BlaBlaCar was born when Mazzella arrived at the Paris airport and wanted to get home to his family in La Rochelle for Christmas. He had no car and the trains were full. However the roads were packed with people driving in his direction, many alone in their cars. He wanted to find one of the drivers going his way and offer to share the cost of fuel in exchange for an empty seat.
Born near Paris, France.
Graduates from École supérieure d’optique (“SupOptique”) and from Paris XI.
Joins Gemfire Corporation in Palo Alto, California, which goes on to raise $85 million from Kleiner Perkins Caufield & Byers, Intel Capital and others.
Gemfire goes bankrupt. Brusson helps refinance the venture and restart the business.
Leaves Gemfire after leading the operations team.
Graduates with an MBA from INSEAD and meets Frédéric Mazzella founder of covoiturage.fr (which later became BlaBlaCar). They present the first BlaBlaCar business plan at INSEAD’s New Business Venture Competition.
Joins Amadeus Capital in London. Invested in companies in Sweden, U.S., UK, Israel, Italy and Ireland.
Returns to BlaBlaCar to scale the company internationally while staying involved part time with Amadeus Capital.
Closes a $10 million round with Accel Partners. Transitioned full time to BlaBlaCar as COO and board member.
Scales BlaBlaCar in Europe with two acquisitions and several country launches.
Closes a $100 million round led by Index Ventures, the largest VC round ever for a French company.
Mazzella created a site to do just that in 2005 and the community began slowly to grow organically. He then met co-founder and engineer Francis Nappez. After completing his MBA, Mazzella worked on a plan with fellow student Brusson, the third co-founder, to finance and scale a service that has become one of the fastest-expanding in Europe.
For the first few years everyone was working on the project part time. After graduating from INSEAD Brusson decided to try his hand as a venture capitalist, joining Amadeus Capital in London in September 2007. For the next four years he invested in, and sat on the boards of, start-ups in Sweden, the U.S., the UK, Israel, Italy and Ireland, while advising BlaBlaCar on the side.
Brusson began work to scale BlaBlaCar internationally, while staying involved part time with Amadeus Capital until December 2011. That month he closed a $10 million round with Accel Partners and transitioned full time to BlaBlaCar as COO and board member.
The French start-up knew it needed to move fast if it wanted to dominate the European market because a similar ride-sharing service, carpooling.com, already existed in Germany. It flaunted convention and used the $10 million to expand internationally before it had proven the model in its home market.
$100 million — France’s Largest Ever VC Round
“By the time most European companies go international it is too late,” says Brusson, who heads up the company’s international growth and operations. “We decided to go early into different European countries — adding a local team each time — before proving the business model, something very few players do.”
The company, which was recently named a World Economic Forum tech pioneer, has attracted 10 million members in 10 European countries plus Russia, Ukraine and Turkey. It transports more than two million people every month, creating an alternative transport network that not only competes for customers with trains, buses and airlines but also creates demand from people who would not have travelled otherwise.
In August 2014 it raised the largest VC round ever for a French start-up — $100 million — from Index Ventures, Accel Partners, ISAI and New York-based Lead Edge Capital. It plans to use that capital to expand to India and Latin America. With big ambitions, and an even bigger potential market, BlaBlaCar is hiring in all of its offices around the world, says Brusson.
Most start-ups think a company must have a huge war chest to make acquisitions. Not so, says Brusson. “It is a misconception to think you need cash to do M & A. The cash side of our early acquisitions was almost zero.”
“In many cases entrepreneurs that start local operations are more interested in adventure [and hence equity] than cash,” he says. “Most people get that it is more valuable to be part of a global company then to create the BlaBlaCar of Italy or some other country.
Multi-Lingual From Day One
“We have created an environment where they have a lot of autonomy and can run their own business within BlaBlaCar.”
BlaBlaCar benefits from their understanding of the local markets and how to best tackle the specific problems posed by launching a ride-sharing service. That saves the French company precious time, says Brusson, helping it become a market leader.
So what advice does Brusson offer to other European entrepreneurs? “Make sure your service is multilingual from day one; that you hire people with different language skills from day one and have people working in three, four or five locations early on,” says Brusson.
If he had to do it all over again what would he do differently? “I would have gone even faster on international expansion,” he says. And, he says, he would have shifted to mobile earlier on. “You constantly have to think about disrupting yourself because if you don’t someone else is going to do that.”
Just as his experience at Gemfire helped him understand the strategic importance of acqui-hiring, Brusson’s time as a venture capitalist served him well when it came to fundraising. He advises other entrepreneurs “not to think of fundraising as something that you do for three months and then you are done. Never forget that the people who invest and take equity in the company are going to sit on your board and define your strategy so you have to think really hard about who you want to bring in.”
Ride Sharing Only The Beginning
What’s more, he says, it is important to reach out to potential investors even before you are ready to raise money. His strategy for BlaBlaCar is to meet target investors and say “‘we are not fundraising now but we might be in a year — what do you think about our strategy and our targets?’ Then if you can deliver what you say you are going to deliver it makes it a lot easier to go back to the same people when you are ready to raise money,” he says.
So where will BlaBlaCar go from here? Brusson says he has integrated Silicon Valley’s “go-go” mentality. Like other entrepreneurs, he works long hours every day, including Saturdays and Sundays. His only escape is taking a few long weekends per year to go skiing. “Ending up in the wild in the winter for two or three days with your phone turned off is a great way to relax,” he says.
Brusson doesn’t foresee slowing down anytime soon. “When we started this adventure we thought if we could get 100,000 people involved it would be a miracle,” he says. “Today we have over 10 million. We could potentially enable better use of cars on a global scale and get hundreds of millions of people to come together through a people-powered network.”
Ride sharing may only be the beginning. “What we are building is a trusted community. We are gathering incredible information about people including their phone numbers, bank accounts and photos and we have peer reviews about who can be trusted. You can potentially do a lot more than transport with that,” he says, an indication that for BlaBlaCar, the road trip is far from over.