Luca Ferrari - Building Bending Spoons - [Invest Like the Best, EP.446]

Great operators chase leverage, not busywork; welcome to Invest Like the Best, I’m Patrick O’Shaughnessy, and we’re in Milan with Luca Ferrari of Bending Spoons.

For those new to it, what is Bending Spoons?

We are part private equity and mostly a technology company that buys one hundred percent of digital businesses, holds them indefinitely, and rebuilds everything from code and design to pricing and marketing.

Set the ambition five to ten years out, especially around people and culture.

We want to build an enduring institution that is both large and excellent, and be the best launchpad on earth for exceptional, inexperienced talent, with roots in Europe to prove world‑class companies can start here.

Why are there still so few European‑born giants?

Founders follow defaults; many of Europe’s most ambitious relocate to the United States by momentum, and more local success stories would change that default.

Why insist on building here instead of going to California?

It was a gut‑level purpose; winning from an underdog region carries extra meaning and can lift local standards, even if starting in California would have been easier.

What was the first real test of your limits?

Our first startup failed, we had about forty thousand euros left, could not sell services, and I hit a breaking point, but my cofounder’s optimism kept us going.

Did you really work at McKinsey to fund the team?

Yes; we agreed whoever got the best job would cover rent and food for the others, I disclosed the startup to McKinsey, they supported me, we raised seed, and I rejoined the team; it was all trust, no paperwork.

Why switch from building to an acquisition model?

Zero to one has heavy luck; we focused on mastering product, engineering, and growth, then bought businesses where we could take them from one to n, and later learned platform synergies matter even more.

What advantages come from a shared home office across many units?

Beyond vendor scale and shared tools, we can rapidly redeploy R and D and marketing to fleeting opportunities and attract better talent with variety and brand; we even built AI to predict performance, which helps when you see about eight hundred thousand applications to hire around two hundred fifty people.

I heard your Slack tag is still recruiter; how did you shape the employer brand?

We treat the job as the product, speak plainly about who it’s for, and build an intense, high‑talent environment that pushes people to become their best quickly.

Why is testing yourself so compelling for you and your team?

Some people are wired to push the limits for their own sake, like great athletes; we seek those people and build around that drive.

What hard personal lesson changed how you lead?

Consensus can be a trap; you must listen well but act with conviction and accept disagreement when you believe the path is right.

Walk us through the early acquisitions.

We started tiny, bought an iOS keyboard app for about ten thousand euros and doubled it, repeated across small products, and compounded steadily into real scale.

What do you look for when you buy?

Stay in digital, favor scale because our work does not rise linearly, buy where we can forecast outcomes with confidence, and where our playbook can move the needle.

Use Evernote as a case study.

We moved fast to make a strong offer, then rebuilt core code and cloud, tightened focus, sped up sync dramatically, raised prices, and still hit record retention and higher customer satisfaction.

How do you think about pricing products?

It depends; with Meetup we added a free tier while charging more for advanced use, and the real edge is smarter segmentation, packaging, and communications.

Why the name Bending Spoons?

It nods to mind over matter and the virtue of hard work, and it is distinct enough to remember.

How do you price an acquisition and stay disciplined?

We debate assumptions without peeking at outputs, run Monte Carlo, and then bid near a fair maximum like Buffett; we are firm if the price drifts beyond our returns.

What is your walk‑away rate?

We typically offer on about twice what we buy and have never been outbid; when we do not close, it is because sellers decide not to sell, which likely means we could negotiate harder.

How have you financed growth?

We bootstrapped with cash flow, added modest bank debt, and did limited equity mainly for secondaries and optionality, keeping dilution low.

Share a deal that reshaped your process.

We once bought at the top of a viral wave and learned to distrust spikes; our failed Grindr pursuit taught us not to bet a year on a single outcome.

Tell us about buying AOL.

It is an overlooked email and portal with tens of millions of loyal users, the fifth most used inbox in the West, and we see clear room to upgrade product and monetization.

Do you often cut product sprawl?

Many teams overbuild; focusing on real customer needs lets smaller teams ship faster and better.

What kind of capital partners do you prefer?

Permanent capital helps avoid forced exits, but founders should still respect that investors need returns.

What sets the best investors apart when they study you?

They work from first principles and judge people’s reasoning, not patterns, and can tell clear thinkers from good storytellers.

How do you handle incentives across units?

We pay fixed salaries and let people invest at a discount; we rely on pride, integrity, and culture rather than KPIs that create distortions.

What frustrates you most about the business today?

We still miss too much raw talent in early applicants, and I worry about heavy regulation that slows everyday progress.

How do you actually spend your week?

It shifts, but I split across hiring, financing and investor work, hands‑on transformations, and platform strategy, with big deals or raises dominating when needed.

What did you learn raising a large debt round?

Lenders obsess about downside because their upside is capped, yet many are visionary; the market runs through anchors and fast syndication with very standardized processes.

How will AI affect what you own and what you buy?

AI boosts quality and efficiency for operators who embrace it, which widens our advantage, and while some verticals will be disrupted, complex products will not be recreated overnight.

What do you do to help great people thrive once inside?

Be explicit about values and live them; we run a playful biannual internal keynote and an annual offsite, like in the Seychelles, to build trust and pride.

Why are there not more Bending Spoons?

The platform is the moat and it takes years of culture, brand, and tools to build, which is a painful entry path that keeps the field sparse.

We end every episode the same way; what is the kindest thing anyone has done for you?

As a painfully shy kid, two classmates, prompted by a teacher, pulled me into their group and stuck with me for months until I came out of my shell; it changed my life.

What a powerful finish; thanks for sharing your story here in Milan, and thanks for listening.