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Lakeba | Giuseppe Porcelli – Building a Successful Fintech Venture Studio.

July 28, 2023 · Hosted by Dexter Cousins

Dexter Cousins chats to Giuseppe Porcelli, the CEO and Co-Founder of Lakeba, a successful Fintech venture studio based out of Sydney.

Giuseppe founded Lakeba with a mission to conceive, create, and commercialise transformative ventures that reshape the future. Under his leadership, Lakeba offers a unique approach to technology investment, fostering disruptive ideas and turning them into profitable businesses.

Giuseppe’s shares Lakeba’s secret to spotting untapped opportunities which has led to the incubation and scaling of successful startups, across AI, blockchain, IoT, and other emerging technologies.

Dexter explores the Lakeba model from a B2B and B2C perspective and their approach to partnerships with major Australian corporations like Woolworths and Mirvac.

Find out more about Lakeba: https://lakeba.com/

Links from this episode.

More on venture building on Fintech Chatter.

More on property investment on Fintech Chatter.

Full transcript.

Lightly edited for readability — filler words removed, wording otherwise unchanged.

Dexter Cousins
Welcome to Fintech Chatter, presented by Tier One People, leaders in fintech executive search. Follow us on your favourite podcast player or Fintech Chatter TV on YouTube.

Hello and welcome to Fintech Chatter, the show where I connect with fintech leaders for a bit of a chat. I’m your host Dexter Cousins, and today I’m joined by Giuseppe Porcelli of Lakeba. Giuseppe, welcome to the show.

Giuseppe Porcelli
Thank you.

Dexter Cousins
Making your Fintech Chatter debut. And we’re here from the beautiful offices here, in my kind of spiritual home of Australia, Manly, where I spent many years here, and lived just around the corner.

Giuseppe Porcelli
Beautiful. Yeah, Manly is a beautiful place. People thinks that Manly is just a tourist place, but is not, actually. There is a lot of a vibe going on, especially in tech businesses.

Dexter Cousins
Yeah, it’s kind of like the… I tried to dub it the Silicon Valley of Australia.

Giuseppe Porcelli
With only one difference: we have a beautiful sea, beautiful sun every time. So I think better than Silicon.

Dexter Cousins
Well, thank you very much for inviting me to the offices today. Maybe you could share with the listeners a little bit about Lakeba, and who you are.

Giuseppe Porcelli
Oh sure. So I’m Giuseppe Porcelli, the founder of Lakeba Group. Lakeba Group is a venture studio, that is an American model of a reverse incubator. Here we conceive, create and commercialise a business. So practically we bring from seed funding to CSA all our investments in technology.

Dexter Cousins
Awesome. And kind of in terms of, I guess, the types of businesses or ventures that you kind of incubate here, what are some of the kind of examples that you’ve got?

Giuseppe Porcelli
Yeah, good question. In the last 10 years we have built about 15 different businesses, but they primarily belong to two main verticals: the fintech and the proptech. We have built products that are very well recognised on the market, like Ezidox, Verimoto, DoxAI, Bricklet, Ezifin. And our focus is fintech and proptech.

Dexter Cousins
Awesome. Now, we’re going to talk a little bit more about the model a little bit later in the show, but in terms of, I guess, the types of ventures that you’re launching here, are they typically what, B2C, or the B2B kind of software style businesses?

Giuseppe Porcelli
They differentiate. So we have products that are designed to just support enterprise clients, T1, T2 lenders, etc. But we have as well product that are being built with the idea to help the community, for example to have the ability to invest in fractionalised properties. So they are dealing with the consumer.

Dexter Cousins
Yeah. How have you found the kind of differences between a consumer-led fintech and a B2B style fintech?

Giuseppe Porcelli
Dexter, what a challenge. Is very difficult, because the B2B and B2B2C is a very different approach, different market, different investment, etc. You must know that Lakeba is primarily an investment house. So we have our people working directly into the venture, with the right skills and the background, so that they can sell the products to the right audience. It’s not all coming from the one place, Lakeba, but is a differentiation of a skill set and capabilities that belongs to the family of Lakeba.

Dexter Cousins
Yeah. Now, you talked about the family of Lakeba. You got some kind of relatives and family in the business as well. What was the kind of motivation? Because I’ve worked with my wife, and she’ll tell you I’m not the best boss in the world. I’ve also coached my son at cricket. He’ll probably tell you I’m the worst coach in the world as well. What’s the kind of secret to making a successful business, and having a kind of family business as well?

Giuseppe Porcelli
Look, the foundation of this business is effectively a family, because all our people, they are part of the program, from the day we start conceiving, creating and commercialising a new business to the exit of that business. The people get rewarded by the exit process. So I do consider my people a member of a family. And the fact that we are Italians, and we are very, very connected with the family principle, we believe that people needs to be part of that.

Dexter Cousins
How many people do you have with Lakeba?

Giuseppe Porcelli
So across the board we have 180 people, between Australia, US, Indonesia, India and Italy. We have as well some representative office in UK, and recently we did a start in Dubai as well, exploring the Middle East like a commercialisation opportunity for us.

Dexter Cousins
Awesome. So you started the business, was it 2016, 2015, 2013? So you’re decade old now. When you look back over that decade, Giuseppe, what would you say kind of is the biggest challenge to get to where you are now?

Giuseppe Porcelli
Dexter, when I arrived to Australia I was only be comprehensible by gesture. You know, the Italian gesture. Yeah. Because at school I had only the opportunity to start with the Spanish and German and Latin as a basic language. So English for me was a kind of a new challenge, a new language. In the last 10 years I personally believe that my English has improved so much.

Dexter Cousins
So when did you move here?

Giuseppe Porcelli
When I did land, in August 2013, actually.

Dexter Cousins
So you’ve only been in Australia for 10 years?

Giuseppe Porcelli
Yeah, that’s all. That’s all. Actually nine years, because we land in Australia in August 2013 for holidays. I had the opportunity to meet a business partner that is still with the business since then, and we went together to a government tender. We won that. I went back to Italy, delivered the product in February 2014, and got sponsored for becoming an Australian citizen.

Dexter Cousins
And you didn’t speak English?

Giuseppe Porcelli
Oh, no English at all. Yeah. First time I meet my business partner, D and younger, we were sitting in this room with an interpreter in the middle.

Dexter Cousins
Right. So I’m going to dive into this, because I wasn’t aware of it, but it’s fascinating, because I’ve never had any guests on where the biggest challenge has actually been learning the language. How on earth have you built a business of 180 people, and kind of, a lot of these people in your business have been with you for a long time? How have you got that connection when you don’t even speak the language?

Giuseppe Porcelli
I’ve been a business person for all my life. Before the technology, I grew up into the FMCG, the fast-moving consumer goods industry. I did the work for Colgate-Palmolive, first in Italy and then around the Europe countries, and I ended up into building my own brand. So in 2012 I did exit from a manufacturing product called the Fresh Up. I sold the brand to a larger player over Italy, and I decided to invest the rest of my life in technologies, because one of the challenges that I had when I was a business person was to use the right technologies to improve my business. Was a big, big challenge.

Dexter Cousins
Yeah. So with the kind of portfolio of businesses that you have, have they all been problems that you experienced in your own business in the days?

Giuseppe Porcelli
Yes. But one of our two Nova was the invention of Prophetical, that is a proprietary technology that we have built from the very beginning. It’s a data scraping tool that is 24/7 scraping information from the web and understanding what the people’s sentiments are. Thanks to this tool we are able to pick up cherry, something that is really cool, the discussion of the moment, and try to invest in those things.

Dexter Cousins
Awesome. If you maybe could talk me through kind of the process that you go through when you first of all identify, “Hey, we think there might be a big problem here to solve.” How do you then go from kind of that initial concept to then creating a business, creating a product or a solution, and then getting that in the hands of customers?

Giuseppe Porcelli
So to give you an idea, imagine this AI environment that is able to scrape the internet and suggest us what is the hot topic of the day. And then imagine your mind a committee of executives that belongs to the business since the very early days, that sits every three months, explore and scrutinise all the suggestions that the machine brings to the table. And plus we bring from outside some advice in terms of a market situation, market needs, etc. And especially talking with our existing clients is a plus. So machine plus real life gives us eventually a good idea of what we have to build next.

Dexter Cousins
Right, okay. So I’m gonna… This is going to be a little bit kind of humorous, right? But at the height of the kind of investment market, kind of mid 2021, beginning of 2022, there were so many businesses that were coming to me who were early stage. They’d been given like five, six million pre-seed money, looking for a CTO, and the ideas were like ludicrous things, like crypto for kind of school uniforms, and all this kind of crazy stuff. Did the machine ever spit out ideas like that?

Giuseppe Porcelli
Ah, good question, Dexter. Yes, the answer is yes. In 2016 one of the hot topic was people were looking for a simpler way to convert into paying a coffee, or paying anything in their daily stuff, with the crypto. Yeah. And we took the occasion to build an infrastructure that was using arbitrage to buy and sell very efficiently crypto assets, to buy coffee. We sold the business in 2018 to a listed entity here in Australia. So that was a time where the machine was right: people is looking for how to pay the coffee with the crypto. And we did invent Paid By Coins that point time.

Dexter Cousins
Fascinating. And why I find it fascinating is, if I look at my kind of experiences over the last five, six years, particularly when I’ve been working with clients who are scaling, one of the kind of key problems that they all experience is how do we reach that next level of scale? They’ve been successful with an initial product, but they kind of cap out the market. Yeah, it’s pretty small. So you got a choice of: do you go international, which is difficult in fintech because region’s got its own regulations, or do you look at new products?

And what’s been really fascinating is that pretty much every business has gone through this same problem, which is the second product that they develop is nowhere near as successful as the first one. And usually what’s happened is somebody has had a cool idea, usually the founder, right, or the CTO, and they’ve pushed through with it without really kind of testing the market and getting the research. So it’s fascinating to hear that you’re using actually AI and machine learning to kind of scrape all this data, and then start to kind of make sense of, “Hey, well, maybe this could be a great idea.”

Giuseppe Porcelli
Of course, Dexter, this has also its own challenges. Of course, into a classic environment you would have a founder that has a great idea, and co-found a business with the CTO to get to the world his idea. Here we have eventually the opposite problem, because when the machine suggests us new ideas, we do not have the founder that is going to spend and invest all his love and passion in bringing that idea to the market.

So our different challenge, I would say, is to later, after we have a great idea that is appreciated and is remarkable for the industry, to identify the right people that can scale the business, firstly in Australia and then overseas eventually. And you know, passion and creativity are two main ingredients for the success. So for us at Lakeba, sometimes one of the challenges to identify how we onboard those ingredients, because great idea is good, but you still need the human people to make the idea available to the market.

Dexter Cousins
What’s been really fascinating, one of the kind of other ingredients for success is money, right? Like, to scale a business, to go global, you just have to have money, right? It’s very difficult to do that without it. And over the last 12 months I think there’s been a lot of questions asked around whether VC is the only path to bringing in funds and finding the investors to actually be able to scale a business. How does the Lakeba model differ to, say, a traditional VC?

Giuseppe Porcelli
So traditionally Lakeba raise capital at group level. So we have a mid long-terms investors that are here for capital appreciation, okay? They do not invest particularly in one idea. They do invest in the people, they do invest into the engine, the machine, the framework that Lakeba has built and proved along the way. So our shareholders are primarily people that are looking for capital appreciation.

But when we then build a new business, we also need a strategic investment on board. So talking of fintech or proptech, when the product are appreciated by the market and we have the first clients on board, particularly for the investment company, we seek for strategic partners, investors. So for example in our proptech we have players like Mirvac, Stockland, News Corp, REA, people that works into the industry of residential property, etc., that are investing into the fractionalisation of the property, because makes sense for them as a revenue stream for the futurist, etc., right?

So when we conceive, create and commercialise, there are investor for long term. When we go into the details of the venture, we have strategic investors on board. So for us has been initially, of course, a challenge to raise. The business has raised the last time in 2018. Since then we haven’t raised any further capital at the group level, because our business are now reasonably cash makers, profitable, so they can return the money back to the company, to the group, and the companies are investing that money new ideas and new technology.

Dexter Cousins
And what kind of appetite have you seen from… You mentioned Stockland, Mirvac, huge ASX 20 listed businesses. I mean, huge businesses, right? Typically they tend to have a challenge in innovating internally, and even when you kind of set up an innovation lab or you have a corporate venture arm, it’s still really difficult to kind of make that work. Have you found that there’s been appetite from those large corporates to kind of look at Lakeba as potentially an innovation partner as well?

Giuseppe Porcelli
Good question, Dexter. Corporate venture capital, it’s new to Australia, in my opinion. Mostly the large enterprises and organisation, they tend to believe that internally they can do themself. But when they touch base with companies like us that are full dedicated and focused on innovation and emerging technologies, like AI for example, they can’t compete. They can’t compete because they live in their own environment, in their, I used to call this, the little bubble, right? If they do not open their mind and explore as well what externally players like us are doing, they will never have the 360 degrees overview to make their business more exciting, innovating, and of course winning.

Dexter Cousins
Now, I consider myself to be an Australian rather than an Englishman now, unless it’s this time, which is the Ashes in the cricket, where I kind of go deep back into being English. But I’m deeply, deeply passionate about the Australian fintech scene. It’s my mission, and why I launched my business was to be a part of trying to make it successful and raising the profile, and I think we’ve done a really good job so far.

We continue to kind of have this narrative of Australia punches above its weight, which I think it does to an extent, but I’m also concerned that we seem to be losing the momentum that we came to gain throughout the years of 2018 to 2023. And I wanted to kind of get your input, as a European having businesses there, coming from there, as to where Australia really does start.

Giuseppe Porcelli
Initially, perception for an European like me that down under is far from the everything. That’s untrue. That’s not true. And the reason why I say that is because I personally believe that after the mining, Australia have one of the best opportunity ever to export the technology. And what we doing in the fintech space, I tell you 100%, no doubt, that is the best that I have seen around the world.

We have clients with some of our ventures in America, for example in Canada, and I guarantee you that when we explain them what we doing down under, they find us like people coming out of Mars. Yeah. Because they have still the cheque. They have still… So when we pitch our products in terms of banking decision making with the AI, without human intervention, that are able to lend unsecured loans to people by question of seconds, yeah, the Americans are impressed.

Of course the culture is different. Even the same language, the Americanised version of the words are different, etc. So they have their own opinion on how to run the banking, and historically they used to be the bank, okay? But what we’re doing as Australia in terms of exporting our technology, in my personal opinion, is the best thing ever. Because I think very soon the mining will go, and we have a big opportunity. We have a big opportunity to stand and say, “We have piloted the best of things here in this country. Now just use it, adopt it.”

Dexter Cousins
How do we then export it? Because if I look from where I stand, some of my biggest clients are companies like Revolut, right, businesses like Y, 10x and US companies. They’ve all come here, right? But we’re not exporting the other way to anywhere near the extent that we’re seeing other countries kind of coming to us. How do we kind of make sure that we’re actually showing the whole world what we’re doing, and how do, I think more importantly, commercialise it?

Because I think, you look right across, not just technology but medicine, science, Australia stands quite high in terms of innovation, but commercialisation, we’re one of the bottom-ranked countries in the world. How do we export all this great stuff that we’re doing?

Giuseppe Porcelli
Well, I think in this modern era, reaching out clients internationally, it’s not anymore a big challenge, as used to be. Where we will make really the difference is by bringing to them products that make the difference, because it’s not question of how, but is more of what, okay? So if we start building a successful digitalisation products like Afterpay… You know, the micro-lending has always been around since the 70s. I remember, I was a child, and maybe you do as well. What Anthony and his partner has identified, this opportunity, is the digitalisation of that process.

And as Australians we can stand up behind of them and say, “We did it,” by bringing the digital experience of buy now, pay later to the Americans, by the massive exit that these guys have achieved. It’s a proof that we have smart people here. We have serious talent people, that maybe today, tomorrow, after tomorrow, at some point in time, they will stand up and show to the world how good we are.

Dexter Cousins
Awesome. Now, I wanted to talk a little bit about, I guess, the culture that you’ve built here. And you’ve got a lot of people who stayed with the business for a number of years. What’s the kind of secret to that? Because my experience is it’s very difficult to keep hold of people as the business grows. So what’s the secret behind the longevity and loyalty of your people?

Giuseppe Porcelli
I’m going to answer you very Talan, okay? The secret is that there is no secret. The reality is that, officially speaking, the company average retainer is 4.5 years. This gives us a very clear indication that people likes the culture, the family culture that we have built in this business.

But I want to also tell you that I personally believe that time by time the company have to evolve. The business need new skills, new talent, new vision. Tendentially, Australia believes that the standing for long time, it’s a good indicator. I believe that sometime can be indicated of a stucking with old school positions and the vision. I think that everything has to evolve, as a business has to.

Dexter Cousins
So that’s something that actually I’ve advised my clients of a lot, right, is that you got to get out this mindset that somebody being with the business five years is a good thing, right? If they’ve made an impact in 18 months and they leave, that’s a way better thing than somebody who maybe makes an initial impact but then hangs around for three years too long. My question is, Giuseppe, how do you maintain a family culture, but then say to somebody, “Hey, look, sorry, but it’s time for us to part ways. You’re no longer part of the family, so to speak”? How do you manage that, and how do you recognise when it’s time to have that conversation with someone?

Giuseppe Porcelli
Okay, first of all, the model here is to making, as I said before, as a family culture, to make people a part of the journey. And our mission as Lakeba is to invest in new idea and commercialise, and then at some point in time exit from those idea by returning the capital to the shareholders. So you can imagine that people wants to be part of the reward. So how we retain people, to answer your question, is by making them part of the exit strategy. So they become as well shareholder of the business. They of course monetise when the business realise a liquidity point, right?

At the same time, we also know that business needs to evolve. To give you an example, we had our investment Shelfie, that was initially just for stock management into retailers. Today is more an AI tool available in any intel camera around the world, that use AI to understand people behaviour, stock management and whatever else that the AI models can deliver.

So initially the leadership of Shelfie was more coming from the supermarket retail industry, you know, innovation for that kind of a chain, where today the leadership of the business is more 360 degrees, where they need to understand how to convert the behaviour of the people into an environment into a data set, right? So the business has evolved from a product for retailer to a generic AI tool available into a camera. Of course, we had to say goodbye to the people that were leading the business initially.

Dexter Cousins
What are some of the cool things that you’re working on right now at Lakeba?

Giuseppe Porcelli
Thanks for asking. Okay, save this bit last. Yes, we are working currently into extending our fractionalisation experience and platform into multiple tangible assets. So as you may know, one of our ventures is Bricklet. Is a business that helps people to buy a property easily, especially people that doesn’t have a deposit, for example, that wants to take the opportunity to buy the first house. We help them to do that. So in partnership with the AMP Bank and DigitalX, we deliver them capital so that they can have access to the property without necessarily a big deposit upfront.

But after a great and successful experience with that kind of asset, we are now extending our technology to multiple assets. So we bringing the fractionalisation to community assets like farms, pubs, wellness centre. And recently, in a joint venture with an American based company, we’re launching as well the cars, fractionalisation of cars, where investors can buy a portion of a car that is rent to the market through a classic Avis or, let’s say, T platform, etc., and get just incomes, dividends, and enjoy the little investment.

This is one of the things we’re working on. So we call this Cotch. Is a new investment that the Lakeba Group is working on. We’ll aggregate all our proptech sides of things, so Bricklet, Easy Prop, Easy Tech and Easy Assets, that are all our ventures working in that space, will be part of one brand, Cotch, that will be nothing else than co-ownership of any technology asset… of any asset, sorry.

Dexter Cousins
I wouldn’t mind asking you about that, actually, because one of the things that’s always struck me about Australians is they are absolutely obsessed with property. And kind of, you go to any party, barbecue, whatever, right, like people always talking about their investment property or their holiday home or whatever. How, with Bricklet, how have you kind of overcome that mindset of owning a property outright, to kind of boast at a barbecue, “Hey, I’ve got a portion of a property, or a farm in Wagga Wagga”? Or how have you kind of found the kind of re-education, or the education piece, of getting people to kind of think differently around property ownership and property investment?

Giuseppe Porcelli
Good point, the education, Dexter, because he’s all about that. But the sentiment of Australians to buy a property has been there forever, right? It’s just a question of education. So explaining to the consumer, to the market, that now certain things that were available only to few individuals are now available to anyone through the fragmentation or fractionalisation of assets, it’s just a challenge in terms of education.

But when the people start understanding, they get the point, and they understand that now they can, rather than keep their money into a safe account, for example, for no return, they can buy a piece of residential property, or they can participate into a community asset, like buying a piece of a farm, you know, looking after the kids for the source of a food in the future. Or even better, be part of their local pub. You know, imagine you being part of your local pub, and participating to the rent of the pub, to the income of the pub, to participating as owner to the initiatives.

Because all our members at Bricklet level, they also participate to the benefits that all the assets have to offer to the participant, to the shareholders. So it’s a question of education. But the Australian culture, the Australian mentality, is ready to adopt new things. It’s historically speaking the best place in the world to pilot a new idea, new concept. So Bricklet is succeeding in that.

Dexter Cousins
Yeah, awesome. Well, Giuseppe, it’s been fantastic to chat with you. We get some seriously talented people listening to this podcast. What’s the best way for them to find out about careers at Lakeba?

Giuseppe Porcelli
People can find more about us on our lakeba.com website, or on our LinkedIn page.

Dexter Cousins
Awesome. Well, Giuseppe, it’s been fantastic to catch up with you. Great story. Really impressed that you can speak English better than I can.

Giuseppe Porcelli
Thank you, thank you.

Dexter Cousins
Well folks, thank you very much for tuning in. As always, you can connect with me, Dexter Cousins, on LinkedIn and Twitter. If you’re looking to hire Tier One People, you can reach out to me on those platforms, or check out tieronepeople.com/contact. Alternatively, if you are on the market looking for a job, make sure to follow me on LinkedIn, where each day I’ll be posting job hunting tips, and you’ll also see us mention any opportunities that we’re working on. Until the next episode, keep safe.

Fintech Chatter is produced by Tier One People, leaders in fintech executive search. We’ll find world-class leadership talent to build world-class fintech ventures, and you can find us at tieronepeople.com.

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