LAVCA heard from Argentine entrepreneur Diego Saez Gil, CEO and Co-Founder of Bluesmart, a smart luggage startup launched on the back of a US$2.2 million dollar Indiegogo crowdfunding campaign.
LAVCA: Please summarize your business. Where is Bluesmart headquartered? When and how did the company get started?
Saez Gil: Bluesmart is an international technology startup that created the world’s first smart luggage. The company launched their first product, the Bluesmart Carry-on, in October 2014 through crowdfunding platform Indiegogo. The campaign raised more than $2.2 million dollars in pre-orders from more than 8,000 backers in 110 countries around the world. The company’s first product is touted as “The iPhone of Luggage” by The BBC; named “Top Innovative Product and Service” by Forbes Magazine; and awarded “Best Travel Gear” by FastCompany. Bluesmart is backed by Y Combinator, Silicon Valley’s most competitive and prestigious technology accelerator. The company is headquartered in San Francisco’s SOMA district with offices in Argentina and China.
What’s your background? How did your experience with WeHostels help when developing Bluesmart?
Saez Gil: With WeHostels I learned the basics of starting a company: assembling a team, raising capital, building a product and bringing it to market. There are always new things to learn and Bluesmart is a different kind of company, where we’re working with hardware plus software, but the basics I learned from WeHostels have been essential to helping us progress faster. I learned a lot of personal entrepreneurial skills upon which I reflected a lot after WeHostels. I’ve since harnessed the best of these skills to become a better leader. From early on we’ve been surrounding ourselves with a great team and a diverse group of investors that had networks we could tap into. Y Combinator for example expanded or Silicon Valley network and our Asian investors expanded our network when it came time to go to China.
LAVCA: Who do you view as your competition? What do you see as your competitive advantage?
Saez Gil: We created a new category and are the first to the market. We have built a very strong team that combines expertise in all the engineering areas in the IOT paradigm from software to electronics mechanics and industrial design. We do expect incumbents in the travel goods industry as well as new startups to come up with competitive products. However we’re mainly focused on harnessing our advantage and perfecting our product.
LAVCA: What’s your connection to Latin America? Do you have any operations on the ground there? If so, what is the talent pool like? Are there certain roles that are easier to hire for than others? Why?
Saez Gil: Some of the founders of Bluesmart are from Argentina, including myself. We started the company distributed between New York, Buenos Aires, and China. Now, as the company is growing, we have realized the amazing opportunity we have to build a company with a presence in Latin America. Our company is headquartered in San Francisco where the core team resides, and we have opened an office in Argentina where we’ll have engineering, design, and customer support staff. There is a terrific talent pool in Argentina. We are bringing this talent to our offices in San Francisco for training so they can go back to our Buenos Aires office with all the tools and technology they need to excel. The raw potential of talent from Latin America is huge.
LAVCA: What financing have you received thus far? From whom and at what point? What resources have you used in your search for financing?
Saez Gil: Initially we did a small seed round from angel investors in the United States and Latin America. Then we went on to do a crowdfunding campaign that raised a record $2.2 million. Then we got into the most famous accelerator in Silicon Valley, Y Combinator, and after that we were able to secure $11 million in funding from investors in Silicon Valley and Asia including: WTI, Cota Capital, PejmanMar Ventures, and Amadeus Ventures.
Crowdfunding helped us with overall fundraising because it was terrific market validation. It gave us the initial funding we needed for our first batch of products and demonstrated a huge demand for our product. Which was a big plus when it came to pitching venture investors.
LAVCA: How have you/do you plan to use the financing? In general, how do you plan to grow the business? Do you have plans to expand further internationally?
Saez GilLAVCA: The main use of the proceeds from our round is going to focus on research and development for new product introductions. Then in go-to-market strategies and to support our general growth. Yes, we are continuing to expand internationally and today we already have four offices around the world: Shenzhen, Hong Kong, San Francisco, and Buenos Aires. From a market perspective, we plan to expand the number of countries the product is available in and the brand as a whole.
LAVCA: What has been the best (non-monetary) support/advice you have received from your investors?
Saez Gil: Y Combinator was especially good at providing great advice to entrepreneurs. We were not only able to tap into the partners, who are all founders, but have also seen all the initial challenges of making a company from other Y Combinator founders. We were able to meet with the founder of Fit Bit and get a mentoring session with him as a result of the network. The advice and support we’ve gotten is as valuable as the money.
LAVCA: Do you have any advice for future investors interested in Bluesmart?
Saez Gil: We have big ambitions to build a global company that will have a long lasting impact. We value our investors and people that believe in our vision.
LAVCA: Where do you see your company in five years?
Saez Gil: We see our company as a global leader in the connected travel product market with millions of travelers using our products around the world. Our company will also be a great place to work.