Shilling Capital Partners: Growing Portuguese tech businesses from seed

An early mover, the influential angel investing firm is accelerating local techs into Brazil and globally


Over the last few years, the Portuguese capital of Lisbon has rapidly risen to become one of Europe's most dynamic tech hubs and startup platforms, particularly since it began hosting the Web Summit, Europe's largest tech startup conference, since 2016. While the success of Portuguese unicorns like Outsystems and Farfetch and that of government policies has been widely recognized, local angel investors who pioneered the development of the ecosystem have largely remained under the radar to outsiders. 

Established in 2011, Shilling Capital Partners has been riding the wave of Lisbon's tech startup ascendency from the outset, backing some of Portugal's most successful startups like BestTables that was sold to TripAdvisor, AI-based translation platform Unbabel and student housing rentals platform Uniplaces. To date, the VC firm has invested in 18 startups and managed three exits. Shilling's current 12 investees have a combined total annual revenue of over €50 million and employ over 500 staff. 

The brainchild of six successful entrepreneurs who became angel investor friends, Shilling was born when they finally decided to club together as professional venture capitalists. Hugo Gonçalves Pereira hails from Harvard, João Coelho Borges from Columbia Business School and Diogo António Rodrigues da Silveira from Berkeley and INSEAD. The other three VC partners are real estate specialist Pedro Rutkowski, investment banker Juan Alvarez and branding guru António Casanova.

Shilling is committed to supporting local startups from seed stage and onward through the growth stages to produce long-term investment strategies. A key differentiator touted by Shilling is that it guarantees sufficient cash for the business until the next funding round, or when the startup becomes capable of funding its own growth.

Success in Brazil 

The international business experience and connections of the VC partners also help local companies to grow faster by going global. “Portugal is a very small market and startups should focus on going abroad from the very beginning,” said Ricardo Jacinto, Shilling's investment manager.

Shilling's first ever investment was in one of Portugal's most successful startups Uniplaces. Shilling participated in the two seed fundings and Series A round. Uniplaces was created by founders who had experienced looking for accommodation as foreign students. Since 2012, the platform has become a market leader in student accommodation globally.

Shilling backed Uniplaces with an initial €200,000 investment to support its global launch and entry into Brazil. The startup now hosts over 35,000 accommodation listings in 165 countries, including private residences. Student apartments let by real estate agents and property management firms make up 35% of the total stock. Shilling's Rutkowski has a great network of contacts in this specialist property sector.

Another early investment by Shilling in 2012 became its first exit just over two years later. BestTables was a restaurant reservation and review site that was established in 2011. Again, Shilling saw international potential, given its traction in Portugal and helped the site expand into Brazil. In 2015, TripAdvisor purchased the startup for an undisclosed sum and integrated its 1,200 restaurant listings in Portugal and Brazil onto its site. Shilling had invested €230,000 with 17% equity in BestTables.

“We are witnessing more companies starting in Portugal and taking on the world. After securing the leadership position in Portugal, BestTables quickly expanded to Brazil to become a relevant player in this huge and untapped market,” Pereira said. “It had an interesting business model for us: restaurants pay a variable commission proportional to the number of people making reservations on the platform,” he added. After entering Brazil, BestTables managed to gain market penetration by offering a reservation management system, unlike local players. Pereira saw the right moment to exit in 2015 “when a fight of the giants was brewing and we didn't have the resources to take them on”.

Investment partners

Shilling has access to considerable and stable levels of credit as one of the three units of Mogope, an influential Portuguese investment manager, originally founded by the Pereira family to invest in Portugal's first private television station SIC. Mogope's CEO Pereira is also the CEO and founding partner of Shilling. Mogope also has a diversified portfolio including OrangeWays, an €40 million investment vehicle focused on developing solar parks and Uhub university residences. In addition, Shilling can also raise funds from government organizations like COMPETE and the Financial Development Institute (IFD).

In 2017, Shilling made an undisclosed investment in Faber Ventures, an early-stage venture development firm that has also backed Zaask and Unbabel. Shilling's diversified portfolio also includes bricks-and-mortar enterprises like food retailers Weeel Frozen Yoghurt and Urban Nature. Besides BestTables, Shilling's other exits are laundry chain La Wash and olive oil specialist Zeyton Nutraceuticals.

Shilling invests up to €1 million, sufficient for Series A or B rounds in Portugal. It typically invests €250,000 initially in each company and looks for a complimentary, persistent and ambitious team. “When you invest in a startup, half of the investment is on the team so it's important for them to have the right skills,” investment manager Jacinto said. Potential growth is assessed on real traction from the market and customers, market size and opportunities in related vertical sectors.

Shilling adds value by leveraging the expertise of its co-founders in retail, investment banking, financial services, real estate, distribution and telecommunications. “We all have a very extensive network of contacts like CEOs who have valuable experience managing companies,” said Pereira. “Very often, entrepreneurs are young and haven't been through the phases of contracting staff, dismissing them, raising capital. So, we can help out in many ways.”

Movers and shakers across sectors

Shilling's Borges has been a partner at Madrid-based Magnum Capital private equity firm since 2007. Magnum invests in mid-to-upper middle market Iberian companies and its biggest acquisition to date is the €140 million purchase of Teknon Medical Center. Borges, who worked at Goldman Sachs and McKinsey in private equity and corporate finance, has also completed nine investments in various European companies as an investment manager at Och-Ziff Capital Management.

Another Shilling partner Alvarez was previously in food retail, and has also worked at a Portuguese bank, management consultancy EY and real estate investor Edge Group. Rutkowski specializes in real estate and founded local agency Worx over 23 years ago. Worx has a global network and is partner of BNP Paribas Real Estate. Branding chief Casanova has a track record in international corporates like SonaeCom and Unilever. He was the latter's CEO in Portugal and now is the president of Unilever in Spain.

Rodrigues da Silveira is the CEO of pulp and paper company giant Portucel. He was also the CEO of Açoreana Insurance and the president of Oni telecom. The former partner of McKinsey & Co was the executive VP of Sonaecom, Portugal's largest private employer and a major media, software and mall developer. 

Finally, Shilling's founder-owner Pereira is a veteran fund and investment manager. The former board member at ASK Private Equity in Portugal had also spent five years in London working at B-Business Partners and Lynx Capital Ventures with a €50 million early stage fund sponsored by Virgin and a €730-million development fund backed by Swedish firm Investor AB.

“I've seen it all, from the bubble to the slump that followed it. I've lived through the cycles in the startup world,” Pereira said. “And having invested in companies like Shazam that went through some difficult times before coming out on the other end stronger and with a more robust business model, I know what constitutes the fabric of success: good ideas, great technologies and exceptional entrepreneurs.”

Translation and freelance sectors

Unbabel is Shilling's biggest magnet for outside investment to date, with over US$31 million invested including the US$23 million Series B round in 2018. The translation site enables customer service representatives to deliver seamless multilingual support, as well as translating content via machine learning and human editors.

According to Unbabel, the global market for translation services is US$38 billion. Unbabel's pricing is about 10 times lower than the average cost of human translation, making it highly scalable in a sector that is still largely performed by humans. The site now has over 50,000 users and 250 staff offering translations in 28 languages. Shilling was Unbabel's early seed and Series A investor. CEO and founder Vasco Pedro commented, “Shilling Partners has been crucial to Unbabel's success. The support, responsiveness and enthusiasm they have always given Unbabel is an example of their dedication to their portfolio companies.”

Another Shilling investment was Zaask that received seed funding in 2013 and subsequently became the Iberian peninsula's "Amazon" for freelance services, ranging from builders to caterers who provide upfront quotes. The VC saw expansion opportunities for Zaask in recession-hit countries that would benefit from having an online marketplace to match unemployed skilled workers to customers looking for their services. Shilling was quick to invest and supported the move to a more lucrative business model. Zaask used a new system of charging professionals for access to the platform's services instead of charging commissions on work done since transactions were often moved offline to avoid the fees. In 2018, the platform had more than 300,000 users and 50,000 professionals listed in 20 cities in Portugal and Spain.

Another successful platform identified early on for its potential was 360 Imprimir, a B2B online one-stop shop for all aspects of printing. Shilling invested €250,000 that enabled the startup to expand into Brazil after closing its seed funding round in 2015. Since then, it has progressed from 15,000 customers to 135,000. Imprimir has also introduced personalization services to its product range. In 2020, it expects to generate revenues of €100 million and serve 200,000 regular clients in four countries.

Dog food and smart betting

Online sports betting is a booming area with a global market estimated to be worth almost US$40 billion. In 2018, Shilling invested €150,000 in BetMarkets, a B2C platform using IoT technology to enable punters to place their bets based on the decisions of both human experts and algorithms. The improved returns from the smart bets may turn BetMarkets into a viable investment alternative to financial markets, said the sports betting company that is “experiencing lower volatility than the ones exhibited by the S&P500.”

In 2019, Shilling invested in a B2B betting startup. The blockchain-based BetProtocol is an online betting application launchpad that aims to disrupt the lucrative online gambling industry. It provides all the backend needs for a betting application at a fraction of the cost of competitors. The deployment of decentralized applications will also be more efficient and auditable. “Shilling has brought a wealth of expertise to BetProtocol through their investment in our future as the new standard for blockchain-based betting. Shilling has provided guidance on the business model and product-market fit, as well as been critical in business development,” said Justin Wu, BetProtocol's COO and co-founder.

Another Shilling investment is Barkyn, a dog food subscription site incubated by the University of Porto Science and Technology Park (UPTEC). The fast-growing marketplace for pets will also offer the online services of a remote veterinarian. Barkyn now operates in Spain, Portugal and Italy, shipping more than 40 tons of pet food every month.

Limited Reading

The rest of the content is only available if you are logged in.

Limited Reading

Your payment was not successful.

Please make sure you have entered your payment details correctly. Or try again in a few moments.

small logo

The discount code you entered is invalid

Please make sure you have entered your discount code correctly. Or try again in a few moments.

Download successful.

Your sample has been sent. Please check your email.

By accessing and using and all pages within the domain (the “Website”), You accept and agree to have read, understood, accepted and agreed to be bound by the Terms of Use and Privacy Policy in full. If you disagree with all or any part of these Terms of Use and Privacy Policy, please do not use or continue any further use of this website. You acknowledge that you are aware that this Website contains an archive of existing content as at 31 December 2021 and is not being actively managed. We are under no obligation to update the content on this Website and, accordingly, no new content or articles will be posted to the Website after 31 December 2021.