Affirm, a leader in payments, recently announced it would acquire Returnly, a return and post-purchase payments solution, for $300 million.
Benzinga spoke with Laura González-Estéfani, the founder and CEO of Miami-based TheVentureCity, on her firm’s role in bolstering Returnly growth initiatives and steps going forward.
What Happened: TheVentureCity is an international, operator-led venture acceleration model designed to make the global entrepreneurial ecosystem more diverse, international, and accessible to fair capital.
González-Estéfani founded the company after a long career in growth and business development at firms like Facebook Inc (NASDAQ:FB), alongside other executives like Chamath Palihapitiya.
TheVentureCity is a unique take on venture capital. The firm approaches motivated founders and looks to become an extension of their team, providing strategic growth insights and capital.
“I want to help those founders that are not coming from traditional tech hubs,” González-Estéfani said in an interview with Benzinga earlier this year. “Help them with everything they need, whether it is capital, product advice, scalability tactics, and so on.”
Given her mantra — brainpower doesn’t have a zipcode — from the start, González-Estéfani looked to drive innovation, by diverse thinkers, in overlooked spaces, like e-commerce return experiences and payments.
TheVentureCity, on top of González-Estéfani’s backing of Returnly founder Eduardo Vilar’s first ticket and seed, participated in the firm’s Series A and B raises, playing a unique role in the company’s evolution.
González-Estéfani noted she met Vilar in a chance encounter at the San Francisco Zoo.
“That was the first time I heard about his vision for the company, and got the details of the problem he was about to fix, returns for e-commerce,” she said. “I immediately connected the dots of the talent he needed on board.”
Returnly was going to address one of the biggest pain points in e-commerce: returns. Given González-Estéfani’s experience at eBay (NASDAQ:EBAY), she saw a tremendous opportunity for the fintech, an area of focus for her fund.
“I know about e-commerce quite a lot because of my experiences,” she noted in a discussion on cutting into the losses presented by the mismanagement of returns. “Vilar is a returns pioneer and, when he was articulating his vision to me back in the day, nobody understood that Returnly was actually a fintech.”
Fast forward to the acquisition, Returnly serves nearly 2,000 merchants and has helped process more than $1 billion in returns used by over eight million shoppers. Through a tech-focus, Returnly takes product return risk and settles orders in real-time, improving return-to repurchase rates and satisfaction.
Why It Matters: TheVentureCity’s Returnly exit is a validation of the firm’s approach to strategic investing.
“We are validating that you can be immigrants investing in immigrants, in the U.S., making great products,” González-Estéfani said in a statement on helping founders fight the odds and spread wealth amongst their teams. “I’m most proud of the relationship with the founder and his investors … and I think about how many people will now be able to pay their mortgage, buy the car they wanted, book the trip of their dreams.”
“Think about how many other Spaniards, in the U.S., or immigrants are going to be inspired by this breakthrough.”
What’s Next: TheVentureCity is looking to foster more innovation in unaddressed areas, by diverse founders, in Miami and beyond, with the launch of a second, $100 million fund whose average ticket size is $2.5 million.
“We just invested in a couple of companies: Suscrip, and Fuell which are based in Europe, AI retail-tech called Outload.ai, which is based in Miami,” and others she described. At the outset, TheVentureCity was thought of as an outsider in the VC space. “When we started, it was awkward with these immigrant female founders in the U.S. investing in companies all over the world. It sounded a little bit like we didn’t know what we were doing.”
Now, TheVentureCity is making a name for itself as one of the leaders in the #MiamiTech movement.
Given COVID-19, “[w]e understand the world has expanded. Its founders no longer want to live in Silicon Valley or New York. They want to explore emerging tech hubs like Miami, Madrid or Barcelona, or even Puerto Rico, the Caribbean,” and so on, she said. “We’re betting on talent with no zip code. We want to be … building with them from the beginning.”
Photo by Tory Brown from Pexels.