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Mark Tluszcz

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Mark Tluszcz
Born (1966-08-18) August 18, 1966 (age 58)
NationalityLuxembourgish-American
Alma materEckerd College, St Petersburg, Florida
OccupationVenture capitalist
Known forEarly investor in Skype and Wix.com

Mark Tluszcz is an American businessman and venture capitalist who is co-founder and CEO of Mangrove Capital Partners, a venture capital firm he set up in 2000.[1] He also serves as Chairman of Wix.com (NASDAQ:WIX), a popular website building platform.[2] His achievements include turning a $2m investment in Skype into $200m[3] and a $8m investment in Wix.com into $700m.[4]

Career

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Tluszcz spent the first 10 years of his professional career at Arthur Andersen, ultimately becoming a partner in its business consulting practice before running its European venture capital fund. During this time he personally invested in a number of businesses including the Frederick Brewing Company which listed on the NASDAQ stock exchange.

In 2000 he founded Mangrove Capital Partners with Gerard Lopez and Hans-Jürgen Schmitz. He was the first investor in Skype,[3] a telecoms business founded by Janus Friis and Niklas Zennström - who were at the time known for founding Kazaa, the peer-to-peer file sharing application. On 14 October 2005 Skype was acquired by eBay and Tluszcz was named as one of the most respected technology dealmakers globally by Forbes magazine.[5]

In 2006, Tluszcz backed cloud-based web development platform Wix.com. He persuaded Wix.com not to sell when it was offered $400m and the company went on to float on NASDAQ in 2013. Its market capitalisation reached $5bn in 2018.[6] It remains the largest tech IPO to come out of Israel.[7]

Tluszcz's firm looks at 2,000 startup deals a year but invests in just six. It has made approximately 100 investments into early-stage technology companies predominantly in Europe and Israel since it was founded in 2000. The company has raised four funds and has $750 million in "assets under management". In 2016 it had seven or eight startups in its portfolio enjoying rapid growth and worth over £100 million.[8]

Tluszcz is on the advisory board of The Lydian Group, a tech conglomerate (company) founded by Gérard López and Greg Fishman.[9]

Controversy

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Tluszcz drew controversy in April 2015 when he stated that the majority of 'unicorn' companies (those claiming to be worth over $1bn) were in fact 'fakies'.[10] Later in the year the technology industry experienced a significant correction with many highly prized companies seeing their values slashed. Having been valued at over $1bn in 2015, Shazam was acquired by Apple in 2017 in a deal thought to be worth $400m.[11]

In April 2016 and amid growing excitement in the fintech sector, Tluszcz attracted controversy again by writing about a 'fintech mirage' in an article published by the Financial Times which advised investors to ignore the hype about fintech, called for greater regulation and raised concerns about the peer-to-peer lending sector.[12] Weeks later peer-to-peer lending platform Lending Club revealed on its earnings call that the CEO had been removed for unethical behaviour. The company's stock crashed 50%, seeing its market capitalization fall by $1.5bn over the following two weeks.[13] He also predicted that app-only banks may struggle to gain the trust of consumers and grow their customer base.[14]

Tluszcz has also expressed doubts over the business models of Gig economy companies such as Uber and Deliveroo[15] which have been accused of not paying adequate wages and taxes. He predicted these businesses will have to go through massive structural changes driven by individual countries’ laws.[16] When Deliveroo listed on the stock market in 2021 it fell 26% and was referred to bankers as ‘worst IPO in London’s history’.[17]

References

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  1. ^ Spurgeon, Brad (July 26, 2013). "Billionaires Stake Their Elite Racing Claims". New York Times. Retrieved March 18, 2015.
  2. ^ Jhonsa, Eric (February 24, 2016). "Wix splits chairman and CEO roles; VC named chairman". SeekingAlpha. Retrieved May 18, 2016.
  3. ^ a b Shead, Sam (April 16, 2016). "A VC who made $200 million when Skype was acquired explains why Israel has become the 'Startup Nation'". Business Insider. Retrieved August 18, 2016.
  4. ^ Butcher, Mike (July 19, 2017). "Mangrove raises $170M for its new fund to invest in Europe and Israeli startups". TechCrunch. Retrieved July 19, 2017.
  5. ^ "Technology's Top Dealmakers". Forbes. February 2, 2007. Retrieved March 18, 2015.
  6. ^ Lan, Shlomit (May 30, 2016). ""I told Wix's founders not to sell at $400m"". Globes. Retrieved August 18, 2016.
  7. ^ "Website builder Wix raises $127M in largest-ever IPO for Israeli firm". VentureBeat. November 6, 2013. Retrieved March 18, 2015.
  8. ^ "The first investor in Skype classifies all the startups he backs as dogs, newbies, rising stars or gems". Business Insider. April 13, 2016. Retrieved August 18, 2016.
  9. ^ "Gerard Lopez's new life in crypto". Delano and PaperJam. 14 June 2022.
  10. ^ "The Risk of 'Fake Unicorns' in the Tech Sector". BloombergTV. April 7, 2015. Retrieved May 20, 2016.
  11. ^ "Apple confirms plans to buy music recognition app Shazam". The Financial TimesV. December 11, 2017. Retrieved December 12, 2017.
  12. ^ "Investors should ignore the hype about fintech". Financial Times. April 3, 2016. Retrieved May 20, 2016.
  13. ^ "LendingClub, the poster child of online lending, is in a life-threatening crisis — here's what you need to know". Business Insider. May 17, 2016. Retrieved May 21, 2016.
  14. ^ "The fintech mirage is losing its shine". Finextra. May 13, 2016. Retrieved October 19, 2016.
  15. ^ "Delivery wars: as another start-up raises money from investors is this the next tech bubble?". Daily Telegraph. May 28, 2017. Retrieved September 23, 2017.
  16. ^ Lomas, Natasha (2018-03-12). "MIT study shows how much driving for Uber or Lyft sucks". TechCrunch. Retrieved 2019-02-04.
  17. ^ Bradshaw, Tim (31 March 2021). "Disaster strikes as Deliveroo becomes 'worst IPO in London's history'". Financial Times.
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