The Party Startup That Deserves to Be Taken Seriously
Interview for Barcelona Startup News by Vivien Magyar
Mattia Franco is the CEO and Co-Founder of Xceed, a Barcelona startup that just won the award for the fastest growing startup in Spain at Tech5 Awards. They may be known as a “party startup” because of their app, which lets users find and buy tickets to the best parties in town, but there’s actually a highly complex software behind the Xceed name that caters to much more than just partygoers’ needs. We felt compelled to find out what the story is behind this fast-scaling project and, above all, who the driving force is. That’s how we came to Mattia Franco.
He’s young. He’s confident. He likes to exaggerate. He’s mildly obsessed with the thought of finally going on vacation to Colombia. But he’s also someone that works so much harder than the next person. He says he was born an entrepreneur, and his achievements with Xceed speak for it.
We had a thrilling conversation about how Mattia started Xceed, what it’s like when you have to fight for years to be taken seriously, what you win and what you lose as an entrepreneur, and what success is according to him.
Work hard, play harder
As I enter the Xceed office in a typical Poblenou building, I notice a couple of things that are out of the ordinary. The space is practically empty, with only a handful of people sitting at a cluster of desks – there’s no sign of your usual startup buzz. The office itself looks a bit like a music studio: walls professionally sound-proofed, an all-around mess and a gentle feeling of hungoverness in the air that’s reminiscent of a party gone out of hand.
“The developers like to come in early, and they’re already gone for the day,” Mattia tells me. “Also, we still haven’t recovered from Sónar last week. We’ve got several people at home in bed with raging fevers.”
He walk me into a meeting room, cordially offers me a glass of water and gestures for me to sit closer to him. “We’ll be more comfortable like that,” he says.
I’m thinking: is he just a kid with a dream that has become way too real, or does he actually know what he’s doing?
From student life straight to business
“I was living in Valencia, I’d just turned 19 and I decided to throw a party in my living room. I invited a friend, a DJ from London to play drum’n’bass, which was unheard of at the time. I also got a strobe light and a smoke machine. Needless to say, the party turned into absolute craziness. One thousand people showed up,” Mattia recounts with a tone of routine in his voice that makes me feel like he’s probably told the exact same story a million times.
After getting fined by the police for blocking traffic – the house party guests had spilled out onto the street, dancing to the music blasting through the open windows of the Erasmus abode – Mattia decided to keep throwing parties. But this time in places where they’re safe from the police. So he started organizing parties at clubs and it all went from there.
“The idea to create a platform where you can find the best parties around you came very naturally. Good parties are hard to find, especially if you are travelling. Most of the time you just end up in the most mainstream place, where you won’t get the music or the vibe that you like. I found it funny that there were already so many apps for booking flights and accommodation, but none for finding parties,” he explains.
“How do we open in Sydney tomorrow if we don’t know anyone there?”
Any teenager could come up with an idea that helps them with their number one ailment: not being able to find parties nearby. But no one else has actually turned it into a business.
“A few months later I built the first website. It was horrible. I’m not a developer, so it was ridiculously ugly, but I guess it was also a bit hipster at the time. I started working together with a team of promoters, and we opened in a few cities in Europe. It was a fun experiment. It went on like this for 2-3 years, while I was finishing my studies and travelling around. When I was in San Francisco in 2013, the platform was still live, some people were actually still using it.”
That’s when the breakthrough came. The lightbulb moment. What is it about the air in San Francisco that has people pouring tanks of fuel on their motivation?
Mattia paints me a very tangible picture of how it all went down.
“We were at a 7-Eleven with a friend at around 4:00 in the morning after a party. You know when you have those philosophical discussions about how to change the world while you’re sitting on the ground, eating those horrible hotdogs that cost like 70 cents? We started talking about: how do we scale this thing? How do we make sure the whole world starts using this platform? I wanted that to be the next step. But how do we open in Sydney tomorrow if we don’t know anyone there?” Mattia recounts.
The SF air must have done it’s magic, and the a-ha moment struck. The solution was to start thinking about the other side of the game: the club managers, aka the people super valuable to Mattia’s business who had absolutely no clue how to do digital marketing or use a CRM. So him and his friend said: “If we create a perfect software as a service that clubs can use, then they will create the content, the events. And then we can open Sydney remotely, because we provide them with a really nice software for free,” Mattia explains. Sounds like a solid plan.
The next step was to build a tent outside their house and work form there, freezing in breezy San Francisco. A prescription of no sleep, Indian dev shops and few crates of canned tuna saw them through to a point where they had a functioning, and often malfunctioning, platform.
“The product became super complex. You have the consumer side which is connected to Spotify, Facebook and Instagram, and now it’s using Machine Learning. Then you have the business side, which is complex times 20. It’s got widgets, a digital ticketing integration, a CRM, and then there’s all the in-event stuff: an app for scanning tickets, another to see the guest list, and so on. Then, there is a third part which is a dashboard for all the spirit brands that can make use of all the data that we collect. Point is, it’s really complicated, and the external dev shops screwed it up big time. When we got the first investment in 2015, and we finally we had the money to hire in-house developers, that’s when it all changed,” ha says.
“You need to ask everybody. Even people that are not investors. Just ask them: do you know an investor? If they say no, then ask them: Do you know anybody who might know an investor?”
The plight of getting investment
“Tough,” is the word Mattia uses to describe his experience of finding investment. “The problem was that I didn’t have contacts. Cold messaging and cold calling people doesn’t work. Even if you go to a conference and try to stop people in person, they’re not gonna care. So what we did was we took part in a lot of startup competitions. I focused on pitching. One time I closed myself into a room for a full month to learn my speech. I have the worst memory in the world but to this day I know that speech by heart, word for word,” Mattia says, and starts reciting his pitch, in a robotic tone and at tongue-tying speed, to demonstrate his point.
“We came second every single time. It was very difficult to stomach, but it gave us a lot of visibility. The reason why we always came second is because we’re a party company. I remember talking to a member of the jury at one of these competitions and they said: you guys were absolutely the best, but we can’t let you win, because you’re a party app. The press and the organizers cannot allow this to be the winner. It was really painful,” Mattia tells me.
Thanks to their Europe-wide tour of startup competitions, the team finally got the attention of a few investors and landed their first round. You’d think that finally, after years of practically getting rejected and now finally being taken seriously, they’d take a day to celebrate. Not Mattia and his team.
“You think about opening bottles of champagne, flying the entire team to Colombia for two weeks… But the thing is, we’d been so tense all these years trying to achieve it, that the day we saw the 500,000 euro appear on our bank account, we immediately started working, finding a new office, etc. The team didn’t even have a beer together. Six months later, we’d already spent the money, and a year later, we got another half a million euros. We didn’t celebrate then either. In total we’ve raised 2 million euros, but no celebration so far. We’re trying to close another round right now, and we’ve sworn that this time, we’ll go to Columbia,” says Mattia.
His tips for other startup founders that are looking for investment? “You need to ask everybody. Even people that are not investors. Just ask them: do you know an investor? If they say no, then ask them: Do you know anybody who might know an investor? Many people are scared of asking, but that’s one of the biggest mistakes you can make,” he explains.
What you’re giving up
I can’t help but wonder what it feels like to be so young, and find yourself managing a team of 25 people who depend on you. I ask Mattia how he copes with the responsibility.
“It’s tough, it’s fun, it’s challenging, it’s a great experience. Some days it’s a horrible experience. It’s everything that startup founders say it is. Entrepreneurs like to play the victim and say: it’s so hard, you have to give up everything in life, etc. Which is all true. If you’re young and you have no experience and no contacts, you will make a lot of mistakes. In order to survive, you have to double yourself in what you’re doing. In the first 5 years I worked Monday to Sunday 16 hours a day. So the first thing that you give up on is friends and family. It’s a trade-off. Whatever you do, it’s never good enough,” Mattia says.
As it turns out, Mattia and the Xceed team have had to overcome some serious roadblocks.
“There are lots of things that go against you. In Italy, for example, we’ve been blocked by stupid laws: it was similar to what happened to Uber, but with online ticketing. We lost all our clients. It almost killed us. If that hadn’t happened, we probably would’ve made it by now and we’d be celebrating in Colombia. But there’s some sort of drama almost every day,” he adds.
Talking about these tough times, Mattia’s voice take on a strangely serious, almost somber tone. He lets me catch a glimpse into the dark side of the business, and at this moment, I realize just how much him and his team have worked and been through to get to this party-stricken office in Poblenou.
He quickly relieves the tension.
“On the other hand, what you learn is incredible. When you’re working in a small team, you learn to do a bit of everything. I’ve done HR, marketing, sales, I’ve even done a bit of coding, UX Design, UI, you name it. It would have taken me 7 different jobs to learn all those things. So it’s really stimulating. You meet people, you travel, you get results and you feel fulfilled. Plus you have the freedom of being your own boss. Although I think this is changing with flexible working, because people don’t really feel the need to be their own bosses anymore. The lifestyle that anybody behind this door has is basically the same as mine. If today is sunny and they want to go to the beach, they go to the beach. And if it rains on Sunday, they’ll come in and work then.”
“For us, the real asset was always the future. Not what we already have, but where we can get. With this team, this passion, this idea. So this makes every moment seem like we haven’t reached our goals yet.”
The road to unreachable success
By this point, I’m convinced that I was wrong not to take him seriously from the very beginning. But I still need to know his definition of success.
“My goal was always to make this thing global. So I can’t say I’ve achieved success until I can go to Sydney and Johannesburg, open the Xceed app and find the best places to party. I can’t tell you exactly how many countries would be my threshold. But we’re so far from it. Right now we have 10 countries and 40 cities in the app, the team is still small, and we don’t have enough resources. I’m still embarrassed about the way our app looks and works sometimes.”
He continues: “To give you an idea… A few months ago Xceed won the fastest growing startup in Spain award. We weren’t expecting to win, and I was absolutely wasted at the event. They called us on stage and they asked me what makes us continue working and grow so fast. I invented this bullshit speech which was something like this: back in the day, assets used to be physical things, like how much land you had or how many cars you owned. Later on it became some sorts of KPIs, like how many users or customers you had. And I feel like, for us, the real asset was always the future. Not what we already have, but where we can get. With this team, this passion, this idea. So this makes every moment seem like we haven’t reached our goals yet. We’re always thinking about what we can do next to become successful. It’s a little bit of a sickness. Every time you reach a milestone, you start looking for the next one. That’s why we haven’t gone to Colombia yet,” he concludes.