Entrepreneurs are people with special character and thinking. What is common and different between entrepreneurs and managers? L’Officiel Monaco decided to define these subtleties on the example of our hero – Alexey Gubarev, the founder of a number of successful projects in Europe.
Alexey, could you share your personal story of how you started your entrepreneurial journey from scratch? What initial challenges did you face, and how did you overcome them?
I’ve never had any experience working as an employee. I started my first online advertising business at university. Entrepreneurs usually don’t think that they want to be businessmen.
What sets entrepreneurs apart is their ability to solve problems quickly and adapt to changing circumstances. They understand that a crisis has occurred but see how they can profit from it. Only people who can transform rapidly can achieve something.
The most challenging period for my business was in 2008-2009. There was a global crisis, and we had a growing company. We bought servers and rented them out. To keep growing, we needed money. The servers took 18 months to pay off, and the capital expenses were enormous. So, I borrowed money from friends at an interest rate of 16-18 % per year. At one point, all our assets were pledged except for life insurance and one apartment. In such moments, the most important thing is to be stoic.
As you progressed in your entrepreneurial journey, what were some key lessons you learned about business, leadership, or success that had a significant impact on your growth?
One of the important lessons I learned over these years is to check the background of the people I hire thoroughly. There have been several situations where it seemed like people were telling the truth, but they were lying, which later played a significant role in my business.
I’ve learned one more lesson – you can’t do everything by yourself. I used to try to do everything on my own for a long time. I would have made more money if I had started changing that earlier. It’s essential to hire people and delegate tasks to them. I realised this when my company was already five years old. But only certain tasks will be executed precisely as you envision when delegating. Why does an entrepreneur earn more money than an employee? Employees, whether lawyers or teachers, sell their time by the hour according to the market price. Entrepreneurs can sell their time for a higher price than the market price.
You were a co-founder of a successful company Palta. Can you share any notable milestones or achievements that Palta has reached since its inception? How have these accomplishments shaped the company’s trajectory?
When we founded Palta with my partner Yuri Gurski, we already had experience creating successful companies. Our success came from me handling the operations and Yuri focusing on the product. The key to successful partnerships is dividing areas of responsibility at work. I’m an operations person, and I enjoy solving problems. I firmly believe that there is no problem that can’t be solved. I often find myself quickly solving tasks that appear impossible to others. Palta has several successful projects, including the period-tracking service Flo, the mindful nutrition app Simple Fasting, and Prisma Labs, which developed an AI photo app Lensa. Whether a project becomes successful depends on the team and the niche. The niche should be significant, and the team should realise the potential of that niche. It often happens that you launch an idea, and it doesn’t work, but if the team is strong, they can find something interesting within that niche. A strong team is primarily led by a founder who has already experienced successful project launches. A mature founder is much more interesting than a rising star. Mature founders’ companies are usually much more successful.
Palta has grown significantly since its founding. Can you provide examples of strategic decisions that have significantly impacted Palta’s growth?
At the end of 2019, we decided to eliminate all the projects where we were limited partners and become a company that owned more than 50 % stakes in sub-companies. We also decided to focus on the health sector. These were the proper milestones. We realised we wanted to be something other than a venture funding company but a co-founding company. We eliminated small projects that took up our time and focused on the ones that provided significant results because we had a larger stake in them.
TechIsland is known for its thriving tech ecosystem. Could you provide an overview of TechIsland and its mission in fostering technological innovation and entrepreneurship on the island?
The mission of TechIsland is to develop Cyprus as a destination for IT companies. This goal has always been my top priority. During the Covid-19 pandemic, a few other IT entrepreneurs and I discussed how Cyprus could become more attractive to IT companies. We created a presentation and shared it with the government. To discuss these initiatives with the government, we formed the nonprofit association TechIsland, which represents the interests of the IT industry. It acts as a buffer between IT companies and all other organisations. There is nothing similar to it anywhere in Europe.
What are the key initiatives and programs offered by TechIsland to support startups and tech companies? How do these initiatives contribute to the growth of the tech sector in Cyprus?
Due to TechIsland, newcomers are eligible to enjoy the incentive of a 50 % tax benefit for the remaining 17 years if their annual income is more than 55.000 euro. And the spouses of newcomers have the right to work in Cyprus. In 2020, IT accounted for 8.5 % of the GDP, and in 2022, this rate increased to 13 %. We have more initiatives in the pipeline to improve Cyprus’s attraction as a destination for IT companies.
Could you provide an overview of the City Friends Club and its mission? What inspired the establishment of this organisation?
My wife, Anna, is the founder and CEO of the City Friends Club. The idea of creating this organisation was a coordinated decision. City Friends Club’s mission is to make Cyprus cleaner. Our children have always been socially responsible – they would take bags and collect trash in our area. During Covid 19, we started walking more around the neighbourhood and realised how dirty it was. I had organised a cleanup of these 8 km, but it looked the same after three months. It turned out that there needed to be more education, social responsibility, and tools in this field. So we bought trucks and set aside space for an office to create an organisation that would address these issues. Currently, the organisation is solving specific problems in Cyprus and striving to create more opportunities for social responsibility.
What specific areas or causes does the City Friends Club focus on in its charitable endeavours? Are there any particular issues or challenges in Cyprus that the organisation is particularly dedicated to addressing?
The main problems are illegal dumps, the lack of a habit of cleaning up after oneself, and the low budget allocated by the government to address these problems. City Friends Club works in three directions: performing a daily street cleaning program, running volunteer projects, and implementing educational programs.
I understand that you have a passion for retro cars. Could you tell us how you developed an interest in this hobby?
The first time I bought my retro cars was in 2014. They were a Ford Mustang and a Ford Fairlane. Later, I bought a Ford Mustang Eleanor at an auction. It’s a classic story where a man’s first car he wants to buy is a Mustang. Then, I purchased several sporty Toyota Supra. At first, I thought I would buy two-three cars per year, especially since I have a building where I can store them in 2019. But then Covid-19 started, and in 2020, I bought around 50 cars, about the same in 2021 and slightly fewer in 2022. Essentially, the entire collection was assembled over three years. My collection has mainly classic cars from the Art Deco era – these cars have soul and style. They are completely different from the cars produced nowadays. It was a time of the car industry’s development, with hundreds of companies manufacturing their cars. However, only a few survived in this market. Many brands in my collection no longer exist as companies. The collection’s primary focus is on Boat tail cars, of which I have over sixty.
How many retro cars do you currently own, and could you share some details about your favourite ones?
I have around 150 retro cars in my collection. One of the cars in my collection, the Auburn 851 Supercharged Boattail Speedster, is considered the most beautiful car of the Art Deco era. They produced only 150 of them; seven were designed as right-hand drive cars. The car I currently have in my collection was found in the Philippines in 1980, then transported to Hong Kong and later to England, where I bought it. I am the fourth owner since 1935. Its first buyer was the owner of a sugarcane factory in the Philippines. The car was abandoned for many years until it was brought to England and restored. Another car in my collection is the silver Jaguar XJ220. I dreamed of it because it was one of the fastest cars in the “Need for Speed”. When I play-through, I thought that if I ever had the money, I would buy that car. It wasn’t easy to find, but I bought it in Japan, and had it sent to London, where it was fully restored and overdyed. In 2019, I went to Monaco for the Gumball 3000 rally. There, an auction was held for a flag on which all the race participants signed their names. At first, I wanted to buy it, but the price was unreasonably high, so I bought a red Ford GT instead. After that, the movie about creating the Ford GT model “Ford v Ferrari” was released, and the price of the car doubled.
How do you balance your passion for retro cars with your professional commitments?
My fascination with retro cars allows me to take a break from work and shift my focus. I recently bought a workshop, Classic Car Loft, in Lithuania to restore classic cars. I had invested in it, and we opened a new work division that is 3.500 m2. It already has many customers. It’s the largest restoration workshop in Lithuania. Within 5-6 years, I plan to open a classic car museum in Cyprus.