How Endeavor catalyzed the launch of MatterScale Ventures, a new venture capital firm tackling inequality
By Fernando Fabre
The best business schools don’t just teach; they serve as incubators of ideas and builders of highly effective entrepreneurial networks, such as Stanford University or MIT. As the President of Endeavor for more than a decade, I saw this same phenomenon play out numerous times within the organization across the world, as Endeavor Entrepreneurs from different continents forged partnerships, or became funders to further their local ecosystems themselves. Today, more than 18 months since my last day as Endeavor’s President, I’m excited to announce a new project born out of this same network: Matterscale Ventures, a venture capital firm created by former Endeavor colleagues located throughout the U.S. and Latin America.
Our core belief is that the biggest financial returns in the next 10 years will come from entrepreneurs offering high-quality, affordable services for the majority, including healthcare, jobs, education, and financial services. The fuel powering the fund is the combination of technological progress (connectivity, data, and devices) with a massive shift in the way service industries are being (de)regulated. The engine behind it, however, is the experience gained during our time at Endeavor, the place that made it all possible
Early in 2019, my partners Adriana Suarez, Gabriela Macagni, and Antonio Luck, then Managing Directors of Endeavor in Colombia, Argentina, and Detroit, respectively, along with Roberto Charvel, a friend from the private equity world and the founding employee of Endeavor’s research arm, Endeavor Insight, came together around a shared observation: services for the majority — not software — eat the world. Merging our collective experience, we launched Matterscale to fund and support the entrepreneurs transforming these industries.
There are two powerful trends shaping the future of services: First, advances in technology to optimize reliably and affordably how people access the best teachers and education platforms; how they reach doctors, medical, and insurance services; how they access full banking services; or how they train for, find, apply, and get a rewarding job. And second, the undeniable social pressure from billions of people demanding equality of opportunities for all, which has resulted in a massive shift to deregulate or entirely bypass the heavy regulation of service industries. Uber comes to mind, but many meaningful examples abound. School accreditation, for example, is becoming less relevant today in the wake of upskilling and reskilling startups. Likewise, when the pandemic hit earlier this year, governments had no choice but to bypass permits to allow telemedicine startups to prescribe over a phone. And, countries are constantly pressured to change their banking regulations to allow fintechs to receive deposits and re-bundle their product offerings, even against a powerful incumbent lobby. It is not if, but when, social pressure and technology will crack down the protected incumbents, and we believe when means now.
So how do you launch a fund to tackle this opportunity? Leaning on our roots, Matterscale invited a group of experienced entrepreneurs, investors, and CEOs to have skin in the game by becoming general partners and help us to raise money, to find and filter deals, and to add value to the portfolio. It should come as no surprise that many of our friends met during our tenure at Endeavor jumped in, such as Joanna Rees, a long-time Endeavor board member and key player in the launch of Endeavor Catalyst; Pilar Aguilar and Guillermo Jaime from Endeavor Mexico; Joe Hessling, Jason Wenk, and Nate Lowery from Endeavor Detroit; Alex Torrenegra, Sebastian Ruales, and Albert Douer from Endeavor Colombia; Santiago Ribadeneira from Endeavor Ecuador; and Paulo Veras from Endeavor Brazil, among others.It turns out we have built one of the largest general partnerships in the world. This is the power of Endeavor’s network.
Starting a venture involves a mix of feelings. There is the thrill and excitement of launching a fund and investing in amazing entrepreneurs trying to change the world, and there is the uncertainty and concerns brought by the pandemic, the social injustices seen all over the world, the rising inequality, and the economic downturn we have all experienced with no end in sight. And yet here we are, standing on the shoulders of Endeavor, and feeling particularly grateful for being a part of this global community. We look forward to investing alongside you.