Christian Gabriel So they started off saying, ‘You know, yeah, we’d love to build Capdesk here. If we can get, you know, 15 percent of your company in warrants, we’ll build it.’ Right. So then we made an incentive saying that I had to accept some specifications in the tech platform. If they built those specifications, those user stories, they would then get 15 percent in warrants. So already there is kind of uneven relationship, because they wanted to put in … you know, the less work possible to get the most amount of warrants as possible. Right. And I wanted to get the least amount of warrants to get the most work done. It’s an asymmetric working relationships because I have no clue what they have to build and how complex it is. Right. So we started that. And once we built the prototype and our second funding round came up, I then asked them, you know, how much would it cost to hire two of you to go full time? And they gave me this ridiculous price. So then I said, you want to be equal co-founders, then? Just equal co-founders. And it took a bit of convincing. And they said ‘Yes. Wow!’ And the first thing that happened with equal co-founders was, ‘Christian, We need to rebuild the whole platform.’
Stephen Cummins: Welcome to 14 minutes of SaaS! The show where you can listen to the stories and opinions of founders of the world’s most remarkable SaaS scale-ups!
Welcome to a single episode with Christian Gabriel, CEO and Co-founder of Capdesk – an equity management platform helping companies manage cap tables and employee shares, from startup all the way to IPO. Capdesk operates out of London and Copenhagen and has hit the news since this interview was recorded by raising a further £3 million in Series A funding in late April 2020 – bringing total funding to 7 million GBP. The company has close to 1,000 European scale-ups on its books. And it’s also launched a new secondaries feature where employees can now sell percentage of their shares for cash early without messing up the cap table.
Stephen Cummins: So we have Christian Gabriel, CEO and founder of Capdesk, an equity management platform here in the Websummit for 14 minutes of SaaS. Hi, Christian, how are you?
Christian Gabriel: Very good, very good. Thanks for having me.
Stephen Cummins: Pleasure. Tell me a little bit about your life up until … and maybe including your university days.
Christian Gabriel: Yeah, there were some good days. Well, I guess where should I begin? Yeah, I travelled a lot as a kid. My parents took me back and forth from Australia. My Dad was self-employed, chose to start a company at that point, went to Australia, didn’t go so well. Back to Denmark, then went back to Australia again.
Stephen Cummins: Wow, What did your Dad do?
Christian Gabriel: He’s a graphic designer.
Stephen Cummins: Explains a lot.
Christian Gabriel: Yeah. And then I guess what happened then is I came to Denmark and I’ve been playing a lot of tennis. And then I got back injury.
Stephen Cummins: Were you successful in tennis?
Christian Gabriel: So, yeah, I was quite successful. Well I used a lot of my time on it because playing competitively, right, I was playing tournaments … so literally, my school days will be, you know, would be finished at 4:00 and then play tennis the rest of it. And the weekends will be the same. So when I got that back injury…
Stephen Cummins: What age were you when you got the back injury?
Christian Gabriel: I was probably, what, fifteen.
Stephen Cummins: Were you intending to get on the Challenger circuit?
Christian Gabriel: Yeah. Yeah, I was doing my best. Well, it was [the same] with everything I did … lived and breathed it, to be honest. And then when that happened, you know… ‘What am I gonna do with my time?’ I had so much time. I would be, you know, out of school at like three. And I was like, ‘What would a normal people do?’ So I got into … My dad was a graphic designer. He gave me some tasks. So I just sat there in his office and worked with some of the clients. And before I knew it, some of the clients said that they would rather want to go with me than my dad because I was a little bit cheaper. Right. I think my dad loved that, though. Right.
Stephen Cummins: Proud of you.
Christian Gabriel: Yeah. So I ended up having my first clients there. When I finished high school, I got an internship in San Francisco. Went to San Francisco. I think that’s where, you know, my life kind of changed. I went to this one event, something I think it was called Podio at the time, it was a Danish startup. Got very drunk. Woke up the next morning and apparently had promised to design five different websites for five different startups. So with my hangover, I just went out, designed all the websites. Did it all. Became part of a startup. Never looked back. All of a sudden, you know, my visa expired and I had to go back to Europe.
Stephen Cummins: Were they paid gigs?
Christian Gabriel: Yeah. Yeah. Some of them were paid. Some of them were not. It was it became very startup-ish. Right. So I founded a little company together with a co-founder in San Francisco. At least that’s what I thought I did. Came back.
Stephen Cummins: You went to Vienna then, didn’t you?
Christian Gabriel: Yeah. Then I worked for a company in Vienna that did SEO, Search Engine Optimization. So they were previous Google employees from San Francisco. That was quite fun. But then I came back to Denmark and nothing was going on because you’ve got that vibe you’ve got here at WebSummit at San Francisco that time. This was Back in 11’. Right. Yeah. And it was just that vibe going on. So I remember this clear as the day … I went to the cafe and I was trying to get, you know, that tech vibe. And there was just Mums, you know, sitting there kids and having some fancy salads. And I was like, what is this?
So I met up with the previous Danish ambassador to Canada and he said the same thing. He’s like ‘Nothing’s going on here.’ So then we decided to make something called Creative Copenhagen in Copenhagen. Where we just brought all the tech guys together. And then we broadcasted all the tech ideas on LinkedIn to the ambassadors, the ambassador network. And before we knew it, a Swedish investment platform contacted us and said, ‘You guys are doing equity crowdfunding. Are we’re like ‘What the hell?’
Stephen Cummins: Are we?
Christian Gabriel: Are we? Right. So they said here’s a here’s a chunk of money. We’d like to hire you, Christian, to be their country manager of Denmark. And I had just started my university degree in computer science, but took the challenge. So our platform was basically … it’s called equity crowdfunding. So we would go to companies and we’d say, ‘Instead of you raising for an angel or instead of you raising from a VC, come to us. We’ll take your equity. We’ll chop it into a thousand bits and sell it to small investors who would like to become a part of your company. Okay. So it’s like Kickstarter, but for equity. Okay. And after I’ve done a couple of cases, I asked the CEO of the crowdfunding platform, ‘Where the hell is the equity?’ He said ‘Well its in spreadsheets’. it was like spreadsheets! Are you kidding me? And that’s when I started to make Capdesk. So that’s my story.
Stephen Cummins: Okay. And it’s amazing that you went to San Francisco for design, considering that while not a lot was going on at the time in Denmark, in SaaS … there was an awful lot going on in Denmark in design terms. Copenhagen is stronger than San Francisco … in my opinion considerably … for design.
Christian Gabriel: Definitely!
Stephen Cummins: So I guess it didn’t feel that way when you were plugged into design and then when you’d kind of been converted to some extent in San Francisco. That’s when it hit you, I guess.
Christian Gabriel: I think it’s all, without offending any people here, but I think I had already worked designed alone. And I would say I’m a quite an energetic person. So it was the first time I had to work together with other designers in a room. And to see sometimes how the thought processes were, and how they discussed things. It was just, you know, ‘I don’t have time for this!’
Stephen Cummins: Yeah. You just wanted to go and do it, yeah.
Christian Gabriel: So the first thing we worked on was … I did like a sketch for it. I really liked it. You know, our manager, he approved and said, we’re gonna use this. And all of a sudden I got this phone call late at night. ‘Yeah. You know, these designers, we’ve just been speaking about it at the pub. We thought …. we actually made something different. So should we do that instead?
Stephen Cummins: So that just felt painful.
Christian Gabriel: Yeah, I just felt painful. It wasn’t the environment I strived in. So I wasn’t there too much.
Stephen Cummins: So you got the idea for Capdesk from this … from the guys doing everything in spreadsheets and it felt really clunky and not very scalable. So when you got the idea, did you go out … did you just go and build it or did you think about ‘How I’m gonna validate this?’
Christian Gabriel: I mean, to be honest in those days … me and my co-founder, we had we’ve just created a little consultancy where we basically … we invoiced the investment platform through that consultancy. And then we just did everything. So it was probably, you know, people … two boys in the start of their 20s just doing everything. Having a lot of fun in an office and taking all the gigs we could do. And then we just had literally just, you know, all these ideas. And Post-it notes with things we wanted to do. And some of them worked out. Some of them didn’t. And one of the things that worked out was Capdesk, because we had an angel investor coming to us saying, ‘My co-founder did a thesis in equity crowdfunding and his thesis supervisor was a business angel as well.’ And he came to us and said, Capdesk is a great idea. If you find some developers, I’m going to fund it.’
Stephen Cummins: So what year was that, now, the stage when he came and said that?
Christian Gabriel: 2015. Just when I graduated university. Same year.
Stephen Cummins: OK. Is that what you did? You went out and found some developers?
Christian Gabriel: Yes. So that was a tricky bit. Finding some good developers. Right. Coz I started a bit, but that does not mean I’m a good developer. And I made the first prototype, which is not considered a prototype by any developer as well. Yeah. So we just started interviewing developers. Really. As first we thought we’re going to outsource to India. Our angel said ‘No way you’re doing that’.
Stephen Cummins: There are cultural nuances to outsourcing.
Christian Gabriel: There definitely is. And em … I think that’s what we learned as well when we found our two technical co-founders who are still in Capdesk that, you know … it’s very much them that found out what we should build. So I had this idea that was, you know, ‘Let’s put shares from spreadsheets on the Internet.’ And that was the idea. And then we found, you know, my two co-founders who could actually, you know, take that ridiculous idea and, you know, make it binary and put it into a computer. And they had to figure it all out. I didn’t come to them and say, ‘Here’s the book. This is what you should do.’ So I think for anybody out there, find some good technical co-founders. It’s gonna be worth it no matter what you pay them.
Stephen Cummins: Fantastic. And did you find them in Denmark, were you saying?
Christian Gabriel: Yeah, I found them in Denmark. And when we started, actually, the story was quite fun. They’re gonna … they’re gonna hate me for telling you this. Right.
Stephen Cummins: Go on!
Christian Gabriel: So they started off saying, ‘You know, yeah, we’d love to build Capdesk here. If we can get, you know, 15 percent of your company in warrants, we’ll build it.’ Right. So then we made an incentive saying that I had to accept some specifications in the tech platform. If they built those specifications, those user stories, they would then get 15 percent in warrants. So already there is kind of uneven relationship, because they wanted to put in … you know, the less work possible to get the most amount of warrants as possible. Right. And I wanted to get the least amount of warrants to get the most work done. Its an asymmetric working relationships because I have no clue what they have to build and how complex it is. Right. So we started that. And once we built the prototype and our second funding round came up, I then asked them, you know, how much would it cost to hire two of you to go full time? And they gave me this ridiculous price. So then I said, you want to be equal co-founders, then? Just equal co-founders and took a bit of convincing. And they said ‘Yes. Wow!’ And the first thing that happened with equal co-founders was, ‘Christian, We need to rebuild the whole platform.’
Stephen Cummins: Did you get … Did you feel a bit angry when they said that?
Christian Gabriel: I mean, I sort of … I sort of knew it. Because you always have this MVP thing. I guess the timing of it … I would like to have known a little bit before, because we had to, you know, raise the funding round. And again, it’s asymmetric because, so you don’t know how much you don’t know.
Stephen Cummins: But even though it would be slightly annoying initially to hear it, it absolutely meant that that decision to give away two thirds of your company was the best decision you made.
Christian Gabriel: Yeah. Yeah. Definitely. Yeah.
Stephen Cummins: So how’s it gone since then?
Christian Gabriel: I mean, since then … So I moved to London right away when we got our second funding round, which is in February ‘16.
Stephen Cummins: What level was that at?
Christian Gabriel: It was just like pre pre-seed. It was very very early .. it wasn’t kind of a proper funding round. We just raised about 100K I think.
Stephen Cummins: Just to keep going.
Christian Gabriel: Exactly. Well it was enough for me to move to London. And I started in a skyscraper knowing nobody … with a little bag. And yeah. Since then just grinded really hard. And now we’ve got about 20 employees at Capdesk. We’ve been growing 15 percent month to month this year. And that’s great. Yeah. And I mean, we just got nominated top ten best companies in WebSummit. So yeah happy days.
Stephen Cummins: So question for you. You call it the most flexible equity software in Europe. So which are the ones that are more flexible than you outside of Europe?
Christian Gabriel: Well our main competitor is Carter … we’re quite … I’m quite happy about that. I mean, Carter just reached a unicorn evaluation. Got backed by Andreessen Horowitz. Perhaps the best investor in the world. Goldman Sachs joined in. So one year ago or two years ago, VCs were telling me ‘Unn that’s a very niche idea. The market size is not big enough.’
Stephen Cummins: So they’ve made the market for you.
Christian Gabriel: Exactly.
Stephen Cummins: And you’ve got late mover advantage.
Christian Gabriel: Yeah, exactly. You know, I can go back to the VC and say ‘I was right’. Right. So, yeah, I think we’re very much building the market together.
Stephen Cummins: What pushes you to do what you do?
Christian Gabriel: I think it’s a bit like, you know, when you as a kid play with Lego. Right. And, you know, it’s Christmas morning and you play with some Lego. Go to sleep. And then on Boxing Day, you wake up and the Lego is still there. And you feel that excitement that you can continue to build on that. It’s still there. That intrinsic motivation. And it starts out with ‘If I just could get this product built. Just could get to here … I’d be the happiest man in world.
Stephen Cummins: You love owning your own destiny, basically.
Christian Gabriel: I think so. But I also think that culture is something that drives me more and more and more. You know. I can create the best team of people that I like to work with. And if I don’t like to work with them and if I don’t think they perform, I can fire them. How amazing is that? So I can spend the rest of my life with people I like and that are great to work with. I think that if you ask most people ‘Are you happy, satisfied with your colleagues?’ I think they’ll say ‘No’.
Stephen Cummins: So are you telling me your ambition is to be a unicorn?
Christian Gabriel: Definitely.
Stephen Cummins: Okay, good. Because I can feel that. A lot of Europeans won’t say that. What’s one personal quality that you feel has helped you succeed?
Christian Gabriel: Diplomacy I think. Not having it too big of an ego. And being self-reflective. And being able to kind of handle, you know, situations that arise. This customer doesn’t like you or employee feels dissatisfied. Being kind of blunt, but also honest and not having a big ego. And kind of being self-reflective … and still being you know, having a high energy level. I think that’s probably one of my best qualities. I thought it used to be my persuasiveness and energy, but I noticed that … that is actually just kind of the hidden weapon I have. Whenever something is not moving my way, I’ll use my energy and persuasiveness. But mostly it’s just diplomacy. Einstein’s got this perfect equation I love to quote; ‘Ego equals one over knowledge’. The more knowledge you have, the less the ego. And if you meet a person … if you hire a person that’s ego’s too big, I think everything’s going to explode. Because you need to work with people that are better than you. You need to work with people who are dumber than you. You need to work with investors who don’t know anything.
I don’t think … it’s very rare you meet a founder that’s just really an asshole. Especially like I work with founders. Right. Because those are our clients. I think most of them, you know, are self-effective and have got less ego. Sometimes when you’re going into banking or corporate you can get those egos, right? Completely different. So I think diplomacy, self-reflection, knowing what you don’t know, learning what you need to learn. That’s the key. And then you can do everything.
Stephen Cummins: Christian. That’s a beautiful note on which to finish 14 Minutes of SaaS.
Christian Gabriel: Fantastic!
Stephen Cummins: Thank you so much for your time.
Christian Gabriel: Of course. Thanks.
Stephen Cummins: The next instalment is episode 112, and the 1st of 3 episodes with Bob Moore, CEO & Co-Founder of Crossbeam. Crossbeam is a SaaS which helps companies organise their partnerships. I interviewed Bob in Lisbon’s Web Summit and, as Chairperson of SaaStock Remote, I’ll be introducing him to their [SaaStock’s] main virtual stage in a couple of weeks
You’ve been listening to 14 minutes of SaaS. Thanks to Mike Quill for his creativity and problem solving skills, to Ketsu for the music and to Anders Getz for the transcript. This episode was brought to you by me, Stephen Cummins. If you enjoyed the podcast, please don’t forget to share it with your network, subscribe to the series, and of course … give the show a rating!
Btw Stephen Cummins did the image this week – so let us know what you think. Is he as good as Mike? Is he better?