BUSINESS VIEW
Sports and Grobo Force, a reward-and-recognise internet
platform which has grown from a €200,000 to a €70 million
company over the past couple of years. But perhaps the best-
known company which he has invested in, and indeed is a
director of, is Bebo, the online social networking site so
beloved of Irish teenagers and twentysomethings. Bebo has
gone from being the 550th largest website to being in the
top 20 or 25 over the past 20 months and has some 10 billion
page impressions every month. Those figures are just for
Ireland, the UK, the US, Australia and New Zealand. It is now
in the process of expanding into Poland, Germany and France.
Maloney is still a believer in social networking and says Bebo’s
interactive features mean kids spend longer on it than others
do on rival websites.
Just days after we spoke, Bebo was sold to the Time Warner
subsidiary AOL for $850 million (€545 million) in cash.
Balderton had invested $15 million in Bebo in May 2006. The
sale earned Balderton more than nine times its original
investment in under two years.
Maloney says for every investment, the idea is always to
build out the management team. “We support entrepreneurs
who have the vision and drive to back an idea but do not
have the skills to build a company. We bring the operational
background.” What is crucial though, he says, is the vision to
build a global business. Maloney says he needs a tenfold
return to look at an investment. “It is high-risk, high-reward.
About 30% to 40% of firms shut down, about 30% to 40%
return two or three times the investment and about 10%
manage a return of 10 times or more.”
The smallest investment which Maloney generally considers
is about €100,000 and the largest to date was €65 million.
“We need to get enough of the company to make it worth
our while spending serious amounts of time building it and
that is generally 20% to 35%,” he says. So, at the end of the
day, what makes a successful entrepreneur? “You have to
have real guts and real drive and be totally focused. The
sacrifices can be incredible.”
Jane Suiter (BA Economics and Politics ’89) is a financial and
economics journalist and for many years wrote for The Irish
Times. She is currently pursuing a PhD in Political Science.
‘We support entrepreneurs who have the
vision and drive to back an idea but do
not have the skills to build a company’
UCD CONNECTIONS PAGE THIRTY FIVE
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