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Interview: A taste of success on the Frontline

For Will Prendergast, co-founder and partner of Frontline Ventures, it's not all about the money

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Will Prendergast has shown an appetite for investment. Photo: Keith Heneghan
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Will Prendergast has shown an appetite for investment. Photo: Keith Heneghan

Before cooking up deals with some of the world's most exciting tech companies, Will Prendergast, co-founder and partner of Frontline Ventures, a Dublin-based venture capital firm, was busy mastering the art of cooking food.

Back in 2001, Prendergast was set to start working with Accenture to sate an appetite to get involved in business.

But with a tech crunch taking hold across the globe, his interest in the world of business had to be put on hold as the multinational delayed the start date in London, and the Co Mayo man started a course at the famous Ballymaloe Cookery School in east Cork.

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"Just as I was about to start, [Accenture] said it would like to delay the start date, so I saw that as the perfect opportunity to take some time and train in some things I care about, and that's when I went to train as a chef," he said.

"Many of the people I trained with went and opened their restaurants, but my own experience is only used in my restaurant in my own house - the kitchen."

One of his classmates in Ballymaloe, Thomasina Miers, went on to win the 2015 edition of popular BBC cooking programme MasterChef and then started Mexican food chain Wahaca, which now has more than 25 sites across the UK.

Despite checking in at a cookery school in London, where he buys his coffee, to "watch what's going on", Prendergast has no plans to open a chain of restaurants just yet.

Prendergast co-founded Frontline, a business-to-business technology-focused venture capital firm, which has $200m in funds under management. The firm, which has backed Irish tech success stories such as Currencyfair and Pointy, is now helping its 70 portfolio companies navigate their way through the biggest crisis to have hit businesses in nearly a century - Covid-19.

"It has been a pretty busy time, you start questioning things you hadn't questioned before," he says. "Our principal concern, once we take care of our employees, is working with our individual companies. It's such a stressful period for them, so that means trying to help them think through all the changes and what it means for them.

"There is a pause on everything for a while, but we are starting to see an acceleration in adoption of technology," he adds. "Longer term, it'll be good for our businesses and the founders we work with, but it's a very stressful human period in the meantime."

A career in business always seemed to be on the cards for Prendergast. As a young lad growing up on his family's farm near Claremorris in south Mayo, his entrepreneurial flair became apparent.

He developed two side hustles, albeit in more rural, traditional industries than he would be used to now.

"I did two things - I used to grow flowers and then sell them to flower shops. That's where I learned about gross margins in flower shops.

"My mother always reminds me, I used to grow and then sell her vegetables. There was a little notebook that she kept where I would write down what she bought and owed me. She looked at it one day, and it said '10 carrots - 20p', and then right below it, '10 carrots washed - 30p'. The value-add was there right from the early days."

Despite the early taste of business, Prendergast initially went for a different career path. He joined a chemical engineering course at UCD in Dublin.

Prendergast realised after his first internship on the course that this wasn't what he wanted to do. In 2001, he secured that position with Accenture in London.

"There was always a goal that I would start my own business, so it was the question of how to educate yourself to do that," he says. "With Accenture, I got to see the inside of so many businesses. I was kind of on a learning mission."

Armed with the insight garnered from looking under the hood of businesses, Prendergast returned to Ireland. In 2006, he joined NCB Ventures, the venture capital arm of the Dermot Desmond-founded NCB Group.

It was during this time that Prendergast cut his teeth in venture capitalism, investing in some of the most successful Irish technology companies.

He worked on investment into Brite:Bill, a communications software firm founded by entrepreneur Alan Coleman. Prendergast said the experience meant he got a sense of what made companies and those behind them successful - lessons which he has carried through to Frontline.

"We look for 'learn it alls' and people who are biased toward action'," he said. "When you think of Brite:Bill, I remember meeting Alan Coleman and he was working on another business called GetitKeepit, which was a consumer-facing business. I remember thinking it didn't have much promise. The next time I met him, he was working on Brite:Bill, which was a business- focused company.

"He had switched the entire company in its orientation in the space of a couple of months. That bias towards taking action, he wasn't clinging on to the past, he just changed direction, and the rest of his team were just going for it."

Understanding how to sniff out a successful business soon bore fruit. In 2016, it was one of three companies bought by the Nasdaq-listed software and services provider Amdocs. There were reports that Brite:Bill sold for around €70m, and that its biggest backers secured a five-fold return.

Despite the taste of success, Prendergast still had an insatiable appetite to form his own company.

The desire to start his own venture capital firm followed a conversation with a founder he had worked with for a couple of years who had returned from the United States preaching about the opportunity to grow the business in that market.

"[The founder] said 'I wish I knew there was a different way of doing this', as in he had seen the way things worked in the US, the scale of the opportunity and how they went about building large businesses," he says.

"I felt a responsibility - we should never work with a founder that didn't get to fulfil their global potential because they never got put on the right path early on.

"That was a real turning point for me," he adds. "So we just said 'let's go and do this from scratch'."

In 2012, Prendergast, alongside Shay Garvey and William McQuillan, set up Frontline Ventures. The firm's ethos is that financial capital itself is cheap, but that learning and instilling ambitions to internationalise is invaluable.

"We have this phrase 'learn faster than the speed of their own experience'," he says. "So if you are just learning as you go along, you are the same as everyone else, you have no edge. We have invested in 70 companies that have crossed the Atlantic, either from Europe to the US or vice versa, so we know what's going on."

Frontline and its ethos proved successful, and the fund hit the ground running. Prendergast counts raising his initial fund as a pivotal moment, followed by Frontline's first realised exit from its investment in Irish tech firm Logentries, which was acquired by the US company Rapid7 for $68m.

"The feedback loops can be quite long in venture, and by quite long I mean eight years," he said. "To be able to complete the cycle and see it starting to work was a real milestone."

Next, Frontline set about investing into Ireland's exciting tech startups, including Pointy, which was recently bought by Google in a blockbuster deal worth a reported $160m.

"I remember my first meeting with Mark Cummins of Pointy. It was a one-person company - in fact, it was a concept in his head. You have to be comfortable with that. The energy you get off dealing with people who are thinking in this creative phase and are super-ambitious is really interesting."

The most recent milestone for Prendergast has been the establishment of the FrontlineX fund, which focuses on investing in US companies and helping them expand in Europe. The new fund was launched after the partners "turned the mirror on ourselves" and felt that as they advised their founders to go global, they should do so as well.

"That was a real kick in the ass to create a firm at that ambitious level," he says. "We are doing it out of Dublin, London and San Francisco - it's a global firm out of those locations.

"The pitch is very much 'you don't need our money, but we can help you with expanding into Europe'. Once we joined those two things together, it put the whole business on a different ambition level."

Since its inception, FrontlineX, which is led by the former head of Twitter EMEA, Stephen McIntyre, has already partnered in some promising funding rounds, including with TripActions, which has gone on to achieve a $4bn valuation.

This year, Frontline has also been involved in funding rounds in Ireland. It participated in Cork-based workplace communication firm Workvivo's €14.7m Series A, as well as security tech developer Evervault's $16m funding round.

Despite the recent investments, Prendergast acknowledges the shape of the industry will be different because of Covid-19 - but only for the moment.

Prendergast believes venture firms have used the three months since the onset of Covid-19 to work with their own portfolio companies. He still hopes to invest €30m in up to 15 companies this year, a third of which could be invested in Ireland.

"Frankly, with the sector we are in, I think there are some amazing opportunities, and I'm not just saying that to be a positive person," he says. "If you look at everything that's going on, it's just going to accelerate at an incredible pace in the next two years.

"The investment pace will take a drop for the last three months, it'll be questionable for the next three months, but then after that, there will be capital continuing to flow into companies."

Prendergast is optimistic for the future of Frontline, and sees the establishment of FrontlineX and the new San Francisco office as key to the company's future.

Reflecting on the success of Frontline, Prendergast is quick to point out it isn't the size of the fund that he measures, but how the companies he invests in perform. For him, the energy and ideas from the entrepreneurs and watching them learn and grow is where he gets the buzz.

"We will never judge ourselves on the size of the funds we manage," he says. "We will judge success on one or two things. It's the success of the companies we invest in or how close we come to matching the needs of the best founders.

"If we are really close to what they need, that is what I will judge as a success."

 

CURRICULUM VITAE

Name

Will Prendergast

Age

42

Position

Partner and co-founder of Frontline Ventures

Lives

Dublin

Education

Chemical engineering at UCD, Glenstal School in Limerick

Previous experience

Trained as a chef at Ballymaloe Cookery School. Worked at Accenture.

Family

Wife Alina and children Timo, Henrik, Tuula and Lenni

Favourite Book

The Days are Just Packed: Calvin and Hobbes, by Bill Watterson

Favourite film

Whiplash

Signature dishes

For kids, buttermilk pancakes - don't be shy with the maple syrup.

For dessert, avocado mousse

For parties with friends, beef bourguignon with celeriac mash

 

BUSINESS LESSONS

What is the best advice you could give to entrepreneurs?

Plan ahead for success. That way if success starts coming your way you are ready to build quickly on it.

What advice would you give to companies that are looking to raise funds?

Investors come in all shapes and sizes. Spend 90pc of your time figuring out who to talk to and then the remaining 10pc of your time talking to those investors. Most founders do the opposite in terms of time allocation.

What are your views on Irish companies internationalising?

For what we do, with business to business software, 80pc of the market is in the US and Europe. It’s essential. The advice we always give to entrepreneurs is take the fight to the most difficult location and you’ll either win or lose in there, but then you will know

Sunday Indo Business

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