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The World’s Largest Private Aviation App – Paul Malicki, Flapper, Brazil

Paul Malicki – Chief Executive Officer of Flapper. Previously involved with three unicorns: Nubank, Farfetch, and Easy Taxi (acquired by Cabify). Vast experience in technology businesses in 40+ countries. Author of the book “The Chief Mobile Officer”. An honoree of the 2017 Forbes U30 list. 

The World’s Largest Private Aviation App – Paul Malicki, Flapper, Brazil

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Flapper is the world’s largest private aviation app. With a proprietary inventory of more than 900+ aircraft and as an award-winning product, an app attracted over 300’000 active users. Flapper prides itself on being the most complete business aviation provider in the world. 

Paul graduated from Poland’s Warsaw School of Economics. He has been involved in entrepreneurship from an early age. He speaks seven languages. Paul describes himself as a conquest character. He loves to be in constant motion.


  • What is Flapper? 
  • Which countries in Latin America are the best for doing business in and why?
  • What is the secret sauce of running a business in Latin America? 
  • How did he end up in Brazil? What is his story of leaving Poland? 
  • What was his first entrepreneurial project? 
  • How to learn seven languages?

Today in Greg Albrecht Podcast, Paul Malicki, founder of Flapper. Hello, Paul.

Hello. How are you?

Oh, I’m good. And you?

Well, beautiful weather here in Rio de Janeiro, so it couldn’t be better.

Paul, could you please explain what Flapper is and how you guys are operating? What’s the secret behind this company?

Well, there are so many things I can actually talk about, but, well, Flapper is the first on demand private aviation company in Latin America, which currently, after six years of operations, has become the largest private aviation marketplace, mobile based. What that means in practice is that we charter helicopters and private jets, you know, up to large commercial aircraft, to wealthy people, corporations and sports teams alike. But at the same time, we are disrupting the existing sector by offering individual seats in private planes so you can fly for the price of premium economy on predefined routes or use one of our empty legs between, let’s say, São Paulo and Rio de Janeiro or Mexico City and Miami. So it is a fairly new concept which currently can be categorized as an aerial mobility company. And we’re very excited about our international expansion and just opened up an office in several countries. So definitely there’s a large potential for becoming a global type of business.

Well, that’s amazing. How did you come up with the idea in the first place?

Well, the actual idea was born sometime in 2015, and it wasn’t my idea. It was an idea of my partner. And as usual, you start with an MVP. Right. He basically saw that, look, I live in Sao Paulo, which is the largest city in the world for helicopter traffic. So there should be some sort of helicopter app, but he couldn’t find any. Right. So he was like, I’m going to create a product which will allow you to book helicopter flights in the city of Sao Paulo. And soon after that, when I joined, I said, look, I think that we have to tweak the concept a little bit because there’s just not enough critical mass for helicopter booking engine only. So we added fixed wing operations as well, which means airplanes. And then we noticed during the Rio 2016 Olympics that people actually are interested in both charter flights as well as paper seat deals. So step by step, we started increasing our offering. We joined the largest accelerator in Brazil called Ace, and eventually validated more than 40 different hypotheses related to product, service, routes, and the type of client coming up with the concept of Flapper as it is today. So what we defined years ago hasn’t really changed. And only right now, when we are trying to advance with our vertical and horizontal expansion, we are adding new service lines and new markets. Right.

What’s the main source of traffic and the main source of clientele for you? How does it work in practice?

Well, it is a fairly differentiated mix. I would say if you look at the last three to four months. Approximately 37% of our clients are B2B, and the rest is B2C. We serve anyone who wants to fly private as long as they go through our safety check. Right. Because we also use technology to validate who the client is. As you can imagine, we are in Latin America, so we receive all types of requests, even from people trying to escape the jail or some politicians, which we don’t want to be associated with. But long story short, if you look at the global landscape, 95% of private aviation flights are actually not luxury in nature. Right. So you have cargo flights, you have medical assignments, you have repatriation missions, a bit of everything. And I think that we kind of fit this definition. We have individuals, but we also have B2B clients, corporations, executive secretaries booking flights for their CEOs, which also means that our marketing has to be 360. Right. It is a little bit digital, a little bit offline, a lot of sales processes, associations, et cetera.

What is it like to do business in South America? I’m pretty curious. The majority of my listeners are from Europe, from Poland, actually. So it sounds pretty exotic. And if you were to start a business in Brazil, for example, where you’re located, what would be your top three recommendations for a person who’s starting a business there?

Great. Well, Brazil is considered one of the most difficult countries in the world to do business, same as Colombia, which currently is our second largest market. So my first recommendation would be, if you want to start a business, don’t do it here. Unless you are already an experienced entrepreneur with a track record doing business approach, that’s really important. We tend to say in Brazil that, first of all, Brazil is not for amateurs. Right. And second, Brazil is a country of monopolies. And if you look at the structure of its industry, it is actually really true. Doing business here is so difficult that only the toughest survive, which means you eventually become a monopoly. Right. Secondly, it is a Latin culture, so it is a lot about personal connections, meeting people, and trusting people. This is both good and bad for business. In our case, for example, there’s a lot of illegal flights because a friend charters an aircraft to another friend. Right. But at the same time, after a while, it becomes sort of a barrier of entry. For example, whenever we try to homologate an aircraft to put it on our platform, I have to visit an operator, which means basically, I’ve been almost in every single largest city in Latin America, because without meeting people in person, it is almost impossible to do business. Right. Third, because of all of that, it is expensive. You might think, well, this is going to be cheaper than starting a business in Estonia or Spain, but these are huge countries. This is almost a billion people living here depending on how you count it, a lot of them living in urban areas. There’s a lack of perhaps such qualified resources as we have in Europe. So eventually you will have to spend a lot on kicking off your business in Latin America, which means you either have to have a good investor or you have to have a very profitable business abroad.

One of my investment portfolio companies called Edrone is actually operating in Brazil. It’s their second largest market after Poland, which is also pretty unusual. But if I were to recommend them, another market in Latin America, which market would you recommend as the next market after Brazil?

So here’s the deal. Most of the people will think of Latin America, let’s say the business landscape, as the one which starts with Chile, goes to Argentina and then at some point ends in Brazil. Right, because Chile and Argentina are considered the most developed countries in South America, especially. But talk to any single serious venture capital company that has experience doing business in Latin, and they will tell you you should focus 80% of your efforts, maybe 90% of your efforts on just two countries, Mexico and Brazil. And for any company that I advise, Brazil has always become at least three times the size of their Mexican operations. So just so you have an idea of the difference. And that created a company.

Okay, so you said it should be Brazil and Mexico.

Definitely. When you look at your international expansion, always talk about high touch countries, mid touch countries and low touch countries. So for Latin America, there’s going to be high touch Brazil, Mexico, mid touch, there’s going to be Chile, Columbia, Peru, perhaps Argentina, but it depends on the business. And then the low touch countries will be the likes of Ecuador, Panama, Bolivia, and so on and so forth. Of course, you have a country like Paraguay, which is right now growing a lot, improving a lot in terms of their reforms and political stability and economic stability and business stability. But there’s just no critical mass. Look at Sao Paulo state. There’s almost 40 million people. That’s the size of Poland. Sao Paulo, as a Metropolitan area, has 20 million inhabitants. That’s a huge market. Sao Paulo has zones which are characterized by the level of human development index similar to Norway. So think about it. If I work with a luxury market, then I have to attack a cohort similar to the South Pole.

What are the most interesting players in the startup market in Brazil? I mean, accelerators funds that you would definitely address while growing in this market. So I think these are the partners that could be really useful for a company entering the market. To connect with.

So listen, Sao Paulo and other cities are large startup hubs. So first of all, you have to select where you are going to place your business. We always think about the country, right? But in fact, we live in the area of cities. So if you want to launch a business in Brazil, where are you going to do it? Are you going to do it in Sao Paulo, which is probably going to be responsible for most of your revenues? Or are you going to do it in Rio because you work with tourism or are you going to do it in Bela horizontal because the quantity and the quality of human resources in terms of engineering is basically the best. So that’s the first thing you have to sort of settle your mind on. Secondly, there are a lot of venture capital companies here, a lot of accelerators in terms of startups. In the Fintech area, we have more than 500. We have almost 20 unicorns in Brazil right now. So I’ll say that in the whole country you have a few major ecosystems that you will definitely benefit from. And it’s not just in Brazil. Mexico City is emerging as the next hub. Santiago de Chile is a fantastic place to sort of run your MVP and so on and so forth. I would say, especially if you compare to Poland, the Brazilian setup scene is some few years ahead. Venture capital wise, I believe we hit more than $4 billion in funding or something. And I can’t remember how far Poland is, but I think it’s something around 500 million. So again, huge markets, which means huge inflow of cash for startups.

Talking about Poland and Brazil, I’m curious. You’re Polish. So how did you end up in Brazil? What’s your story?

I think I’ve always wanted to leave abroad from the very beginning. When I first sort of started skiing in France or Italy, I was like, oh, that’s great. I really want to learn new cultures and sort of use traveling as one of my main hobbies or sort of ways to discover the world. When I was around, when I was 18, I went for my first exchange program. It was very short in Holland. I loved it. Then I realized that when I go to a University I have to go for another exchange program and that’s what I did. I went to Sweden and Sweden has completely opened my mind. I just realized how many things there quite simply work. Today Poland is way more developed than in 2000 and let’s say eight or six. But still back then it was a huge difference. So after Sweden, I really wanted to go abroad as well. I went to Warsaw School of Economics and on the second year I was accepted to Taiwanese University called NCU. After that I came back because my supervisor, Professor Palserovitch basically didn’t let me finish my master thesis. And from then on, basically, it was a flow of different countries and situations. I first came back to Sweden, then I went to the Philippines. After the Philippines, I went to Brazil. My visa was rejected, so I ended up in Colombia. I loved it. I actually wanted to stay there. But then I had to come back to Brazil because I had certain compromises with the company that I was working for briefly than Singapore, and eventually ended up in Brazil. Three years in Sao Paulo and currently my fifth year in Rio de Janeiro. So you see, it’s a little bit of studying, a little bit of working, and most importantly, a lot of international contacts. Right. Because the people you meet during your studies, these are the people that are going to place you later on in certain workspaces. Right. All around the world. So that was really valuable for me, meeting international communities, building my network, and sort of benefiting from it in the long term.

Cool. And what was your first kind of entrepreneurial project? The project that you’ve got involved in. And then you can recall it and maybe laugh at it right now or maybe not. Maybe it was something that really brought a lot of interesting inspiration and knowledge.

Look, I’m from a family where my mother used to work in a local bank, eventually expanding it to a regional sort of level. My father used to have his own company. So entrepreneurship was sort of always there at my grandparents side with a farming background. Right. So when you have a farm, you typically work since you’re a small kid. Right. And I recall we had to sort of help my grandfather since we were like seven years old. When I was around 14, I was actually working at the farm at the Plantation of Mint. And that was really what I would consider a heavy work. Right. An equivalent of what an adult does. So why I mentioned that is because work has always been present in my life, and that’s something probably different to many millennials today, which they end up at University and they have zero work experience. I feel sorry for them. And I think that’s sad. I think everybody should be given a chance in their life to work as a child. As a teenager. It doesn’t have to be hard work, but at least to value work as an integral component of our life. First endeavor. Look, there were many starting from me selling CDs because I was one of the first persons in my small town of Points who had a CD recorder. Then I was selling smartphones, basically looking for the best deals on Allegro and trying to chip in some cash from guys who are willing to pay more. And when I was around 14-15, my brother decided to buy another farm. He didn’t want to become an It specialist, which is what he was studying at that time. So that’s something I also consider an entrepreneurial endeavor because I was pretty young, I was a teenager, and I had to help him out with literally everything, building sort of a startup farm because it is a formally state owned enterprise. But there’s just so much work you have to do from scratch machines, hiring people. So it’s always been there. Right. And then when I started working with startups, almost every one of them being a young technology company, then I had a chance to learn a lot first hand. And when this idea of fluffer came about, I was pretty happy to join my co-founder and start growing it. So, yeah, I would say that’s more or less how it works. It’s a mix of experience and sort of my family background.

What is it like to move that much along your life to different locations? I mean, friends, family, do you miss them? How does that work?

It is a little bit strange of me, but I am the type of person that has sort of a conquest character. I can come back from a trip on Saturday when I literally just conquered a mountain. And on Sunday I want to do something similar. People are just asking, man, aren’t you tired? I’m like, no, I really just can’t sit in one place. I can tell you I’ve been in Brazil for eight years, and it’s been too long for me. We just came back from Spain and I’m looking for a second apartment to sort of swap places. Right. I want to be buffing Europe and in Brazil at the same time during the Pandemic, I did from twelve to 15 countries, both in 2000 and 2021. I just can’t stay in one place, man. I have to travel. I have to explore places. I have to open new markets. It interrogates part of me. And I can’t explain it. It’s just in there.

That’s cool because it actually aligns very well with the business that you’re running. Right. It’s also about traveling, about moving from one place to another.

Example, in 2019, just to have a reference, I did 140 flights, mostly for business.

Well, that’s a lot. Yeah. So how do you deal with stress? Are you stressed at all while running a pretty complex and responsible business in such a huge and diverse environment of Latin America? Or you’re just relaxed by nature and you don’t feel stressed at all. You don’t have any challenging moments.

When you have a fairly complex business. You just can’t stop thinking about it. I don’t think we can call it a stress. It’s just making your brain busy thinking about your business. How can you improve it, who else you can hire or fire, et cetera? So there’s just one moment during my day when I can sort of think about something else and sort of reset. And that’s when I train martial arts. I’ve been training martial arts since I was 18, maybe 17. I used to be a vice champion of Poland in muay thai, and currently I’m preparing for a couple of competitions here in Brazil. So still very active. And when the adrenaline comes to your blood, your brain resets. It’s the only moment during the day when I don’t think about my business again. Can I call it stress? I am not the type of person that gets stressed. I’m fairly calm even though I’m impatient, but I don’t feel stressed. But at the same time, there is an overwhelming feeling of sadness which arrived in my life a few years ago. Because after being in almost every single country, meeting so many different people, advising many different companies, I just realized how an apologies for my wording, but how fucked up the world is, how unfair, how badly distributed the wealth is, how many idiots are governing our countries, and how much you can actually learn as a human and how little of that we use as a humanity. So that’s the only thing that is deep inside my brain that I can’t stop thinking about, and I think about it every day, but still, probably my main line of thought comes with the company.

So is there something that you think you can do about the unfairness of the world in a microscale, macroscale that can maybe give you a little bit of a relief or at least solve part of the problem?

One of the most wonderful things in life you can do as an entrepreneur is hiring people, making them grow, developing their personal skills is just miraculous. And that’s one thing that I really focus on. I want to grow my company up to the point where we increase certain market efficiencies. Right. But also we have a team of around 200 people where everybody has something to do, and I think it’s wonderful. Do I engage in charities or other events like that? Yeah, I do, occasionally. One thing that was really well received by lots of my followers was that I offer free mentoring sessions in exchange for donations to certain causes. That’s how we even managed to sort of finance some projects for people of deficiency where literally 100% was funded through my mentoring. But I would say that’s it. I think that as an entrepreneur, you have to focus on your main business and make it grow and make people employed because unemployment is one of the worst things that can happen to a human.

How do you decide when to stick to a certain business and when to switch into something else? Because obviously you could say, okay, I’ve grown this business up to a certain scale, but now I can use my entrepreneurial skills to solve some other problems in the world that I can do using my toolset that I’ve built as an entrepreneur and employ it into solving some bigger problems than maybe transportation which is I’m not saying it’s not a problem, but obviously it doesn’t serve that much the people that have these problems with wealth distribution.

I think that your decision really depends on your appetite and your ambition. Some people just don’t want to have problems. My brother has a farm of 400 ha. When I asked him, Why don’t you buy 4000 more? He’s like, I don’t want to because with 400 ha I can prepare the soil myself. I can cultivate it the way I want. I don’t need to hire more people, and I don’t want to hire more people because I don’t want to have a pain in the ass. In my case, I believe that my business can grow by a factor of ten in the next three years. So I’m just going to follow it. Right. I’m going to follow the path that I have sort of designed for myself. When you have a startup in general, you look into markets which have at least $1 billion in size. Right. Why? Because that attracts venture capital. And when venture capital comes in, you can grow faster and you can build a business in a better way. Now, when should you leave? I mean, that’s your personal decision. Some people leave when they have an exit. Some people leave when they get tired. I don’t think there’s one universal decision. But what I can tell you is I’m a partner of four other companies where I’m a shareholder and I’ll definitely keep investing and I will definitely. It’s definitely not my last company. Right. I know that eventually I will leave the company because at that time I will have crowned it up to the point where there’s just no more point for me to be there because I can’t help it. Right. So that’s more or less how I think about it. I don’t think there is one universal definition.

Yeah, sure. I was just curious, just as an abstract concept of transferring your skills from solving a strictly business problem into solving a kind of humanity problem. But of course, there is the right time for everything. So I think if you decide to change, then the time will be right. You’re going to pursue some other goals that you will find more attractive and possibly that can solve the problems that you have just mentioned and that are so painful to you. So what are the main tools that you’ve used to grow, except for experience like your real life business experience that you have used and that have contributed the most to your growth as an entrepreneur?

Oh, boy. I think broadly speaking, there’s just one thing that teaches you how to win in such a smart and sustainable manner, because you have to do it on a recurring basis. And it’s sports. Right. So it’s still probably the best tool I’ve ever used. But if you want me to be specific, you cannot copy hard work or replicate hard work and you cannot replicate discipline. And discipline means actually using certain tools, using calendars, using project management tools, making notes, reminding yourself at the end of the day, what is it that you’re going to do on the following day? And making sure that your mind is free to have a good rest. So I can name a lot of those. But I think that, again, hard work and discipline are irreplaceable.

Is there a book that has strongly influenced your life?

I don’t think there’s one single book. I tend to read books every now and then. To be very honest, I’m just too impatient to read a book. I read 20 pages and so many ideas just come up in my mind that I have to stop and I just start doing something else. But I love anything about self discipline, productivity, entrepreneurship, and venture capital. I don’t have anything on top of my mind, and I probably don’t want to promote a single book. But I think that, again, it’s about habits. Right. It’s about discipline. If you start reading books which make you a better person, what do you do? You continue. Right. One of the books that was probably the first book that I read about venture capital was angel by Jason Caliconic. One of the first podcasts that I started listening to was the 20 Minutes VC from Harry Stabbings. These were the first does not mean they were the last. Right. I still keep exploring new content.

Sure. That’s great. Thanks for the advice. It’s absolutely understandable that there is no end to learning. But I’m just curious about the things that really stand out of your experience that you have in your memory and that you really feel like sharing. So is there an experience, maybe a trauma from your years as an entrepreneur that has learned you a lesson?

Yes. I got asked this question many times and I thought about it many times, and I came up with just one single answer because I believe that life is all about learning. Right. You don’t regret your past action. Right. But if I was about to agree to advise someone on how do you sort of structure your start up at the very beginning, considering also your financial needs, et cetera, start saving money now and don’t make yourself broke or don’t let yourself get broke. It is a dramatic moment when you look into your credit card and it’s negative $10,000. Right. I don’t wish that on anyone because being poor really sucks.

Yeah. So what kind of a decision led to you experiencing that?

Well, as I mentioned before, I had a co founder in my startup, and at some point the guy just left, he went nuts and we had to exclude him from the business, even though he was the main investor and he was the one who had capital and was willing to put more, which means I had to finance the company’s growth for a few months from resources, which were virtually nonexistent. Right. Because before that, I was also working in a startup. And when you work in a startup, you don’t work for salary, you work for equity. And luckily enough, when I was literally with negative bank accounts, we sold that sort of, and I monetized my shares. So with those shares, I was able to finance the company’s growth for the months to come. But that single moment really defines my approach when it comes to building companies. I will not let myself get broke again. And if that moment comes, I simply look for consulting opportunities because I don’t want to leave with zero in my bank account. I still want to go to the gym. I want to have a nice dinner. I want to have proper mental health, because mental health is something that when you suffer, you can rebuild it. Right. And you have to take care of it every single day.

Yeah. So what would you do differently to avoid the situation that happened with you and your business partner going nuts?

Well, I think we manage it very well. First of all, I went to Moscow. I met him personally. I tried solving a problem. I managed to buy his shares basically and distribute most of them across my partners. But again, I was very short on cash. So looking back, I would probably fire people faster. I wouldn’t wait for me to just run out of resources. It’s sad to say that. Right. But I can tell you that one of the entrepreneurs that you know very well, who I’m not going to name here, has told me a few months ago when I was in Poland that the reason he raised such large amounts of cash was that he fired so many people when the Pandemic came about that his investors eventually understood that this is a real deal, that this guy is serious about the business, and now he actually rehired most of them. So these are the rules of the market. You can’t really fight with it against them.

Yeah, I think I know who you’re talking about. Very interesting story, by the way, and a lot of courage to fire and then hire. I think it’s like the story you tell when you have this when you’re on a plane and they say put your mask on first and then put the kids mask. And I think it’s the same thing. I mean, if you cannot protect your kids, if you’re going to suffocate, they’re going to eventually die, too. So that’s about being reasonable, about protecting yourself. But another layer to that question is how would you protect yourself from dealing with a wrong partner? Was it something that is possible to predict? And how would you choose your business partner? Or how would you mitigate the risk of a situation that happened in the past with your partner if you were to start a business again today?

Well, first of all, there are always those situations that you cannot really predict, like people getting divorced, pandemic coming about out of nowhere. But that’s one thing when it comes to choosing people, I think that, first of all, you really need to look into people that are trustable. We just hired a person in Colombia because I trust her. It is a very difficult market and I’m sure that she will do a great job. Right. When it comes to hiring people for co-founder roles, you need to look for those guys that complement your profile. For example, most of the people are either a creator or a manager. If you are a creator and you hire another creator, then you guys can have a conflict because you both want to create new things. But someone has to manage this stuff, right? Someone has to manage your DayToday operations. So that’s why you need to look for a manager. Same in terms of your functional areas, right. You look for a guy who is a CTO because he has a technical knowledge, but you also look for someone in finance. I think that’s pretty obvious. But even within those functional areas, you still have to think about it. Whether the guy is a good manager or he will always want to create new things, which is probably going to give you a headache. Also, what I’ve learned throughout the last few years, hiring and firing more than 10 people is that the requirements of an early stage startup are very different than the requirements of a late stage startup. And then of a company that goes for an IPO. Right. Because not everybody wants to work for 12 hours a day during the early days of just founded Soda. But also not everybody wants to manage 100 people. Right. There are people who would love to manage some large groups of employees, and there are those that just want to work as freelancers, kind of, right?

Yeah, totally. I just had a conversation over lunch with one entrepreneur here. Exactly about this. So the problem he sees while growing his startup pretty dynamically is and he asked me this question. I’m curious about your answer to that question: what would you do to make people stay longer with the company? I mean, of course, some of them will be just at a certain point of time, they will be just incompetent to stay in the role if they don’t grow because the company changes. Some of them just want to do, I don’t know, expert roles, not managerial roles. These are obvious cases. But taking into consideration that somebody is growing alongside the company, what would you do to make that person stay with you and not move to another company? What are the factors that influence the retention of key managers?

Well, the company has to do one of the two things. It has to grow or it has to make money, meaning be profitable and generate a lot of cash flow. So I think it’s really difficult to maintain people or maintain a low churn rate if you don’t grow or if you don’t create a profitable business. That’s the basics, right? Most of the people will start telling you here, you have to give equity, you have to have a nice culture. Listen, successful startups, they have a very low turn. Why do they have a low turn? Because they fucking kick asses men. They’re amazing. They are in the media. They pay well because they can pay well, right. So I think it all starts with finding a business which has an amazing business model and ability to generate cash and also has this capacity to create new markets. Right. Airbnb is a great example. Airbnb has created an entirely new market. It didn’t exist before. Uber is another example. Today many people criticize Uber, but for some reason the equivalents of Uber in other markets, including Brazil, including Latin America, including the Middle East, have done a great job. They could either acquire it or they went for an IPO. So it all starts with the very concept. And then you go into the specific proper management of people equity, paying them well, giving proper feedback, making sure that there is some job rotation in case of developers, for example. I think building squads is one of the best way to retain talent because the guys circulate sort of between different roles and they never get bored of individual projects. Right. It is a complex response. If your business sucks, it doesn’t matter how good of a manager you are, you will not maintain people for a long period of time.

Probably, yes. I don’t know, hard to say. Depends on their profiles because there are some people who just like stability and probably if they like it, you can go along with these people for a long way. So I would say my perspective is that it’s more about the alignment of kind of values and ambition between people. So if your ambition is to have just a well functioning midsize business and these people are happy with that and what is important to them is predictability, safety, security and family style of running the business, they might stay. But I agree it’s difficult for companies that are growing quickly because the culture can be changing quickly and also the requirements are changing quickly. And I think this is the place where it’s pretty difficult to maintain people because often the CEO is also not growing quickly enough to really fit into the tempo of growth with the changes. If we’re talking about business, is there a myth about business or one truth about business that you believe in? So either a myth that you think is not true or one truth, one thing that is fundamental to doing well in business.

It depends on how you look at it. Let’s say you build a startup which doesn’t make any money, you go for an IPO, your venture capital investors go crazy. They manage to create 15 times the returns. Is this a successful business? Even though for the following five years this company might not make money, people successfully some cash on selling the shares. I personally don’t like such cases. I like businesses which are profitable, which have a functioning business model, which are scalable. And that’s one reason why we probably haven’t raised millions of dollars. But we generated enough cash in December for me to finance my operations for months to come. So it is a nice business. It is a sexy business, but it’s also the one which makes sense. So I think it’s exactly what I said during your previous question. The business has to grow and the business has to be profitable. And that means it has to generate cash. It has to have high margins. If you have margins of 3%, that’s a shitty business. Even on a large scale, that’s a shitty business. Uber used to manage used to apply 25% margin in New York up to 30%. At some point. That sounds like a good business, but then they had a lot of issues with their costs at headquarters. Because you know how difficult it is to hire people in San Francisco these days, right? Developers earn like $10,000 a month. So overall, the business probably wasn’t profitable enough. It is a complex thing to run a business, but the basics need to be there. Whether you run a pharmacy or you’re into something like AI or NFT, there has to be profitability behind.

I totally agree with that. But I think there are many people who are successful, as you mentioned, in business in a way either on the investment side or on the founder side that are running a not profitable business that just creates the leverage thanks to the momentum and the speed of growth instead of focusing on the profitability. And it’s also not the way that I think the business should work, but it seems that today the speed of growth is more important than profitability. And how do you compete for venture capital money when there are companies that are promising exponential crazy growth and beautiful returns and they make these amazing promises which are against reasonable profitability, but they show that they will just acquire huge markets and they focus on this while you want to keep it more reasonable. Actually, the guy that I had this lunch with today has exactly the same type of mindset. So he just raised the amount of money he needs in order to scale into a certain market. But he’s not into this whole crazy go IPO becoming a unicorn game because he thinks he can create value for the customers, which is critical to create a profitable business and benefit the shareholders. But that’s not a typical story I hear as an angel investor. Normally everybody promises that they will become this unicorn, and this is actually the story most of the VCs want to hear because of the returns they expect to make. So how do you navigate with your investors while having this reasonable approach to business?

Also, we definitely have to find someone to blame for. Right? Venture capital cares mostly about returns, right? Only today and mostly in more advanced markets such as Silicon Valley. People start talking about impact investing, investing in combating climate change, et cetera. But that’s a small, tiny piece of what those guys do. Most of the time. What they care about is the returns. I want to get a five times return, 15 times the cash invested, which means that as long as the company gets acquired or goes for an IPO and by the way, only 3% of startups go for an IPO, then they’re happy. Now, is it ethical that you have a highly unprofitable company going for an IPO, going public or even publicly admitting that they might never have profits? Well, we have to look into this as a huge problem within the stock exchange ecosystem. Right? Because if someone wants to acquire a startup because of their resources and unique technology, that’s one scenario. But if you go for an IPO, there has to be some requirements for companies to be listed, and they have to prove that they will make money in the future. Otherwise some people are going to lose on it. Right. Look at the US market right now. How many specs did we have in the last year? I believe there was more than 600 or 400 specs. How many of those are profitable? I think around ten. An average loss per spec was around 27%. Why is nobody looking into it? I don’t know the answer to this question, but it should be public institutions that do it. Now, totally straight to your point. What investors look into, they look into large markets again, more than $1 billion in size markets, which are scalable companies building new markets. They’re looking for exceptional teams. And when it comes to the actual KPIs, well, these days they value GMV more than profitability, but yet they would like to see high margins. They would like to see low cache and high LTV. And they also want to understand what is your run rate? If I give you $10 million right now, assuming that rate of growth, for how long you’re going to survive and so on and so forth. Talking to investors in Silicon Valley, you get totally different questions than talking to investors in Poland. Those guys are just way above our League. We have to admit it. They ask some questions which are even difficult to respond to because that’s what they use in their financial models. But again, I think that if you want to put it simple, it’s three T team technology and traction. That’s what they look like.

Yeah, totally. Still, have you raised capital for? I understood that you’ve raised for Flapper. Is that so?

Yeah, we raised a couple of rounds. We currently have both angel investors. We have a crowdfunding company. We have a venture capital fund and we are about to announce our new funding as well. It wasn’t easy, right? I had 228 meetings to close my seat funding and I had 530 meetings to close my series A. My business is very specific, right. Because it is difficult to understand how private aviation works and it’s kind of difficult to imagine what’s going to be the impact of electric aviation in the years to come and how this is going to change our lives. But still, the investors that I found, they really believe in the sector. So there is some sort of sector focus. They believe in me as a founder and they’ve seen the KPIs, they’ve seen that the company is growing. We have increased our gross profits last year three times. Right. That is a solid company to invest in, right. There’s no secret sauce, right. I think it’s even sometimes more about the process itself than what you’re trying to sell because people tend to give up, they tend to do cold calls. But if you get a proper intro to a VC, your chances to get an investment raised by leaps and bounds.

Yeah. Part of my question was that your reasonable approach to business can be a turn off to some investors that would like to hear you tell the story of becoming a super unicorn in two years and maybe conquering the world by any means, regardless of profitability. And I’m curious how you navigate your true values, which are I think business should be profitable. And also and you find the right ears of investors that kind of understand it while it can compromise the scale of returns potentially because I don’t know, maybe the market is not as huge or maybe the speed of scaling will be not that big because you will be still focusing on profitability and not only on the dynamics of growth.

I think that every single VC should allow the company, at least for a little while to go profitable. Hey, listen, grow for one year, then decrease the costs and see if you can break even. That’s what we did, right. We grew, we achieved our break even point and we said to our investors, listen, this business makes sense. This is what I’m going to do right now. I’m going to open a presence in Colombia, Chile, Miami, Mexico, and soon after Europe and the Middle East because we have to increase our revenues and start earning in dollar while spending money in the local President currency. They said, good, Paul, go for it. I feel perfectly fine with my approach. I proved that the business makes sense. I know that it will make sense in the future. Worst case scenario, I’m going to shut down a few markets now if you ask me. Okay, but what about all of those guys that are raising $200 million without being profitable and sort of investors betting on their rate of growth. Is this ethical? We should look into their unit economics, right. If at least on an operational side, there is an operating profit or if the relationship between tech and LTV makes sense.

I think it’s a good business. Right. Unless you’re lying to your investor. The question really is, should this be public? This should somehow control, I don’t know, VCs investing money in businesses that don’t make sense. I don’t know. I think that this is subject to a debate. But again, the numbers will lead you there, right?

Yeah. I really love it. What you’re saying about the stock market and the kind of terms on which actually VCs who are privately held companies but often spending retirement money of some people out there in the US or whatever, which is where the majority of the capital comes from, should probably be somehow looked at in terms of the decisions they make. Also, some people will say, well, that’s a very conservative approach, because without spending and investing money in companies that are not profitable, we would not have these amazing technological advancements that don’t make money. But it actually changes the world because we can create an IP that will not be profitable today, but maybe in 50 years we can cure cancer or whatever. That’s a very interesting discussion. I think there is no truth in it. I mean, there is no one truth that can be applied. But I’m really happy that you brought this up because it’s rare. And also when you’re inside this game, so you’re part of the game, you’re playing this game. Like, I’m also an angel investor. I’m a co-founder at a startup. And I see this perspective from both sides. It’s sometimes very difficult to be objective and to speak openly. It’s kind of a casino in some areas, so everybody should judge their own decisions. I think that’s pretty important to be ethically correct in terms of what we are doing and how we’re performing.

But there should be some control. I’ll briefly tell you a funny story. So years ago, when I was a partner at EasyTaxi, we were supposed to merge with another taxi company. This merge would allow us pretty much global coverage. Super excited. Did a lot of meetings. The company was founded by some Jewish guys. We had some synergies. We were super excited to sort of go ahead with the Merch. We were even actually giving them control. That’s fine. We’ll solve it during the IPO. And then at some point, we actually noticed that their financial reports were full of lies. They were inflating their revenues. The business wasn’t as big as they said it was in many countries. They were getting their ass kicked. So we backed off. Literally three months after that, we saw a Polish fund pouring. Excuse me, my words. But she made lots of money into those guys. And I was like, why would you ever do that? I mean, didn’t they have due diligence. Why did it happen? And now when the ethical question comes into place, I believe that one of the co-founders of that Polish fund was Jewish.

And whenever you want to do business in Israel, you have to be Jewish, man. If you’re not Jewish, you’re never going to get venture capital money from there. Recently I learned that this company is actually thinking about going public. And again, I’m asking myself, what the heck? Didn’t anyone sort of check their financials? And by the way, since then they didn’t grow. You can just see that the market footprint didn’t change. So again, someone has to control this because that is unhealthy for the ecosystem. That creates a bad reputation of startups and eventually that creates a bubble. And by the way, you and me, we understand the basics of the game. But the Jonases, that puts the 10% of their retirement into stock exchange, they don’t. Right? And we have to protect those people. They need to understand that sometimes they don’t invest in a company which will bring them returns.

I really love and appreciate your honesty. And that brings up a question. We’re living in a world that is becoming more and more politically correct. So there are some things that when you say them, some people may judge you and say it’s inappropriate. Probably if you said the thing that you said about doing business in Israel in America, that would be perceived as something very controversial and maybe biased. So what do you think? How should we navigate being kind of correct and being honest in order to be successful in a way that we are honest to ourselves, but yet still we can easily operate and do not have problems because of that. What do you think?

Very good question. And I asked myself this perhaps ten years ago and I came up with the following response. We need to stop having opinions. We live in the area of data. We have big data. We have the internet, we can scientifically prove literally anything. When people come to me and they say in my opinion, I say stop. Just don’t use this term. Just tell me according to the data or based on what we found out or based on my experience, because that changes your argument. Right. And today we see it all over the place. People trying to invent New Covet type of solutions. I said, guys, do some research. If we see that the vaccination works, stop saying that these are Chinese 5G companies trying to invade the world. I mean, it’s just coming crazy. How many conspiracy theories do we still have? Whereas the responses are in there, right? Perhaps there is a question of trust. Some people don’t trust the government so they won’t believe in any data they publish. That’s another problem. Why don’t they trust the government? Why did they vote on them in the first place? Didn’t they have information about what type of candidates they are. And then there comes the part where people do proper marketing and then they win elections. But again, we need to stop having opinions. We need to start being more data driven and our arguments just cannot be bold anymore. Many people will criticize and say that’s unethical humans are not like that. Again, we need to evolve, man. There are like 2 billion people in the world that are living below the poverty line, right. Someone has to do something and there are enough resources in the world to help those people. So again, what I said at the beginning, the world is just so fucked up. There are so many things we can improve and we are just doing nothing.

Totally. I mean, it’s very difficult. The things that you bring up. I also have some kind of viewpoints on them. And I guess these are very difficult questions because it’s also about majority voting and kind of the split of education. So if we’re using a tool where the majority votes, but maybe the majority is not equally educated or doesn’t have the right processing mental processing power of the way or the way of thinking through a scientific lens that creates the problem because they might be voting in a way that is both based on emotions and I mean, we’re all kind of emotion driven, even if we’re saying we’re making decisions based on data. This is a fundamental problem that is pretty hard to be solved, I guess. But it’s great that we’re talking about it because this is something that maybe also inspire other people to be more considerate about the decisions they are making and it’s in our hands. And that’s our responsibility to improve the world in a way, I guess. So you said you’re traveling around the world, building a business in Brazil, kind of being restless, grinding and creating something new all the time, being impatient and doing muay thai. What are the other things that people should know about you or the things that you do or what is important to you and you would like to share it?

Oh my God, what a question, man. I’m such a complex creature. There inside. There are just so many things I like doing and I wish I was doing. And I think the last years have been full of suffering. Right. Because of that covered situation and building my company. Right. I don’t know. I don’t really have any response. I think that what’s public is already available there on Google and you can read some stuff. I don’t know. It’s the first question I can’t really respond. I think it’s all been said and done.

Okay, well, if there is a message you could send to the world that would kind of be the number one message that you can transfer to everyone, what would it be?

Learn mathematics. Listen, China produces in one year. More developers produces. Right. In question Mark produces more developers than the US has developers. Our government is pushing history lessons like we needed them to survive. I mean, don’t you guys understand that the world is being eaten by algorithms? There’s a huge shortage of developers right now. Startups in the US are paying up to $20,000 a month to the most qualified guys. It’s going crazy and it’s going to be even more about technology, about smartphones screens, connected IoT devices. So if you don’t let your kids learn mathematics and don’t motivate them to learn mathematics and you agree with their bullshit that they’re going to become another human science specialist, even though there’s an oversupply of those guys at the labor market, you are to blame for the failure of the world. Yes. Being a little bit philosophy here. And of course part of it is trying to give a few fun examples. But yeah, it’s true. I truly regret that the education system is not aligned with the objectives of where the business is going.

Yeah, actually that’s a very interesting area that I have certain doubts about. So on one side, I agree that mathematics and programming are the things that are massively necessary for the world to develop, and this is a scarce resource. On the other hand, there is always this human interface that maybe it’s not about quantity but quality. So you’re doing B to B. And these are some areas of the kind of human to human interface that are pretty difficult to replicate and kind of being replaced by systems and by algorithms. So I’m curious how this is going to work and whether the soft skills would be something really important in the future. Maybe that could be something that actually when everybody turns into algorithms, the soft skills will be something that could actually create the winning of the different winning managers.

Yeah, you’re partially right. And I say partially because we just don’t have enough data to sort of support your tees. But one potential scenario of the future development of the labor market will be that developers will actually create algorithms which build other algorithms in a way that you don’t have to be an excellent developer to create new technology products. And when that happens, people that will be valued are those that solve problems related to mental health because technology also has this ability to destroy certain markets if they are not well managed. Which means we have countries like Finland trying to implement a four day working week, six hour working day, and mental salary for everybody who is unemployed, and they prove that they cannot find a job. If we follow that direction, then you’re probably right. I still believe in the value of work, and I think that probably eventually the scenario that we will experience is between what we both propose. Right. Difficult to assess, right. Very difficult.

Totally. We’ll see. How many languages do you speak?

Well, I speak seven. Right. I used to learn German at school. As well, but I don’t count it anymore. I don’t like this language.

So how do you learn a new language? Because I probably picking up the first one, the second one, the third one. By then you kind of build up a muscle or kind of a way of adding another language. So now if you were to learn another language, what kind of tools or methods would you use to excel and become communicative in this new language?

Yeah. So you’re right. After your fifth language, learning the 6th and the 7th and the 8th comes easy because you sort of learn how to sort of develop your very own process that works for you. Right. I truly believe in the importance of grammar. There are many people that say, oh, I learned a language because I was attending meetings for foreigners. I said, dude, try to write an essay. And trust me, after eight years in Brazil, sometimes I asked my team to write a copy and they are native speakers. And it’s just that I can improve many things just because my grammatical background is better. So there’s no one single response. But it is a mixture of studying grammar, practicing, watching movies in a foreign language. It is always important to visit or live in a place that speaks a given language. And really being the type of curious, analytical person. Right. I was recently thinking I don’t know how to say in English any publish words related to mushrooms. Right. Like how you say Brown cubic in English. Right.

No idea.

Nobody knows that, man.

It may not even exist in the everyday language. It may only have this Latin expression because maybe it’s not being cultivated in a way. Actually mushrooms, it’s not a very popular thing. I think picking mushrooms. Well, now it’s becoming popular because of the psychedelics, but that’s a different story. But if we’re talking about typical mushrooms, I don’t know, you would have to probably figure it out. But of course, before you get into problems of that size that you want to really get into details and you exceed ten or 15,000 words in a certain language. And there’s earlier this phase that makes you a communicative person in that language. And that’s what I’m actually pretty curious about because I’ve been studying Spanish and it’s a new thing to me, learning a language as a pretty mature person from scratch. And I’m kind of looking for hints to speed up. That’s why I’m asking this question. But I think it applies to many people.

Also, one very good strategy for you to improve a given language is to find a job where this language is needed because my Portuguese was very good when we found it Flapper. And then I realized that I have to get to a new level. Right. I have to speak business Portuguese and my grandma has to be even better. So I polished it. Right. And again, you need to be motivated. I remember when I was in Taiwan and I ordered food from the menu, which was written entirely in Chinese, and they brought me stinky tofu, which is, if you’re a foreigner, that’s the most terrible food for you to start your adventure with Taiwanese cuisine.

If you don’t smell it, it’s actually pretty tasty, but it’s not easy to eat it and not smell. That’s my experience from Taiwan, and I agree that was something I was also served the first time I was there.

And I agree. But if it’s your first meal and you wake up on a hangover, that’s not what you wanted to order. So the first word I learned in Chinese was chicken, right? That’s geiro. And I was like, super happy entering a restaurant and saying, Gero, whatever she asked me, she probably asked me whether I want it with Pesta or just like G Ro, do whatever you want, just give me Gio. So you see it’s a lot about motivation as well, right? If you have the motivation, if you use the language on a daily basis, of course, you can eventually Polish it, right? Otherwise, it’s difficult to become fluent. Okay. So from a perspective of a citizen of the world living, I guess many years abroad, if you visit Poland, what are the things that you see as the ones that have changed the most in the recent years? And what are the things that you think are interesting about the place or people that can be valuable in a kind of global geography?

Right. Look, I still think Poland is one of the most normal places in the world, right? I mean, I see a lot of countries just being overwhelmed by immigration, and I don’t say that as a negative connotation. I just say they don’t know how to deal with it. Right. We seem not to have this issue. We seem to have a fairly integrated society, although probably on a political spectrum. There are just too many people slanted towards either left or right. But definitely Poland has changed in the last few years. I see it as a fairly technologically advanced country. We are a global leader in touchless payments, for example. Just one example. But you go to Germany, you want to pay by credit card, and frequently people will say, no, I’m not even asking to pay taxes. And just, I want to use a credit card. They say no. Buildings are getting more beautiful, people are becoming more qualified, the food is becoming better. I mean, look at Warsaw. Behind every corner. You have a different type of restaurant from all around the world, right. So I actually am very positive when it comes to the future of this country. And I think that if nobody really, pardon my French, fucks up anything, this is poised to grow. Let us remember that until the Pandemic, it was the country which has grown, which had grown for, I believe 35 years without any disruption so stability is important.

Cool. So what is the thing that myself and the listeners should wish you in the coming days, years, and the future?

Oh boy. Wish me an exit. I think there comes a time when we should be thinking about an IPO or joining some bigger group. It is a wonderful moment for any entrepreneur to sort of get financially stable and yeah, wish me discipline again. If you have discipline and if you’re willing to work hard, you don’t actually need more in life because eventually you will figure it out. Life is all about iterations, right? Failing, trying again, failing, learning and so on and so forth. It is a vicious circle and the entire human race is based on a combination of wars and victories and there is no alternative to it.

Paul, thank you very much for your time for your insights. We’ve touched on some topics that I haven’t expected and I find them very valuable and it’s thanks to your perspectives and the way you think about the world. So thank you very much. Also thank you for convincing me to record the first podcast episode in English which was also mentally challenging things for me. I also like to be challenged and that’s thanks to you. So Paul great conversation. Wish you all the best. Paul Malicki. Thanks.

Thank you till the next one.


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