The untold story behind Affirm's recent acquisition, Returnly, and his founder Eduardo Vilar

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Affirm acquires Returnly for $300M” - Humanizing our 1st Exit of the Fund TheVentureCity, because this is not JUST about Returns. It’s about RnR , babies and Los Cantores de Hispalis.Before reading, search Spotify for “Los Cantores de Hispalis” song, “Tócala, Tócala, Tócala.” That’s what I hear in my mind every time I think about Returnly!If you are JUST interested about the return multiple of our investment, let’s say that our investors and our team at TheVentureCity are beyond happy. But if you read below, you are going to realize that the most fascinating part of this story is not the “Returns’’, BUT the ability of his founder Eduardo Vilar to build both a company & a family in parallel.

So get ready and let's the untold story begin…

We met Eduardo at San Francisco Zoo back in 2012. Both my family and his were new to the city. He was carrying his six-month-old daughter in his arms and I was carrying my three-month-old daughter in the stroller. It was a cold rainy day in the city.

During our chance encounter we shared what brought us to San Francisco, far away from our families in Spain and Jamon Iberico. In that first convo, we found out that Edu’s wife Maria was related to my husband Teddy’s first RnR band’s bass player, Dani Lajo . That was the 1st time I heard about his vision for the company and got the details of the problem he was about to fix, returns for ecommerce. I immediately connected the dots of the talent he needed on board and told him about meeting Marcos.

A few months later, Marcos - who was also the pianist in Teddy’s (My Husband) band, who I’ve known since he was 12 because he was my sister's 1st boyfriend, and who is now Edu’s CTO - invited us for lunch. (By the way at the time, Marcos had another baby of the same age as our daughters). It was a surprise for us to find Edu and Maria there. Looks like Edu had already met Marcos prior to my recco but we did not know we were talking about the same guy.We hadn’t expected to see them again, in fact, the first time we met, I have to confess that I thought that Edu was too sure of himself. (If only I’d known...).Anyway, the three couples and our five kids became really good friends (three of the kids were mine). At the time, Marcos was working for Modcloth, Returnly’s name was Actucast, and I was working for Facebook. Thousands of miles away from our homes & Jamon Iberico, the adventure started.

Very soon, Marcos became Returnly’s CTO, Teddy and I became Edu’s first investors, and we all spent every weekend together. We truly became a family.

Returnly was addressing because prior to Facebook, I’d worked for eBay - at the time eBay was the world’s largest ecommerce platform. (Yes, I am that old !)Like a family, we helped each other through the ups and downs. Returnly’s story is a story of Edu’s love for Maria and his family, his passion, hard work, resilience and much persistence.Again, far away from home, and Jamon Iberico. A story of building a company and a family at the same time.It’s true that you really know a person in their low moments, and Edu, like any entrepreneur, had many. But he always managed to get what he needed: capital, talent, clients, anything. Throughout his journey I introduced Edu to other Spaniards in San Francisco who helped him big time; one of them them being Javier. The network effect kicked in and Javi introduced Edu to other relevant people for Returnly’s journey. Among them was Ariel&Cindy. Ariel became chairman of his board and a the couple friends forever.Returnly was getting traction fast , and expectations were high.

He was the pioneer of Returns when at the time not many people knew about the challenge returns posed for e-commerce.

E-commerce back then was not what it is today, and Edu saw the tremendous opportunity way ahead. Marcos and Edu made such a fantastic team. I remember those endless conversations around the Machine Learning they were building, the data optimization, prediction algorithms, funnels, data, etc.A couple of times in this story, Returnly essentially had less than a month of runway in the bank, but still Edu persisted and made it through again and again. At the same time as he was building a company, he was building a family, and baby #2 arrived , Sammy.

We travelled together through the United States in our vans packed with strollers, diapers, and baby bottles, always mixing business chats with baby chats.

That’s when I visited Miami for work for the first time, and became fascinated by its potential. I went back to San Francisco, spoke to Teddy, and we decided to move to Miami. After my husband, Edu was the first person to know I was ready to leave Facebook and build my own company.When I pitched him TheVentureCity, he told me I was trying to cover too much, and asked why I didn’t just focus on being a VC.In Miami, I met Clara, my Co-Founder and partner. Clara fell in love with Returnly’s business, she invested personally right away, and together we created Genus Ventures, which also invested in Returnly. Every chance we had, we invested!TheVentureCity was finally born, and again, we invested in Returnly’s Series A. As the company grew we introduced him to other great investors like Rajeev who also became a board member and a great support for Edu.Finally, as the company grew and set up teams in San Francisco, Chicago and Madrid, Edu reached a point where he was managing more than a billion returns. Craft Ventures led the Series B round, and Edu’s dreams became a reality. After so much work, persistence, sleepless nights and baby #3, Daniel, he received the big check, with plenty of experience to boot. At the time, he already had social capital, index and SV Angels in his cap table. But Craft’s was the biggest sum yet, and his passport to the accomplishment that led me to write this story today.

See? Dreams come true when you persist and work hard.If you are an entrepreneur from an emerging tech market like Spain, and you think you won’t be able to make it, you won’t. Edu had a dream, went after it, and he knew he would make it without question. He was always willing to make sacrifices, very efficient with capital, and always with Maria by his side.

Many times when visiting San Francisco for work while at TheVentureCity, I stayed at Edu’s, and he would not turn the heating on, he’d save every penny...

I swear!

Baby #4 arrived, this time a puppy called “Chucho.”

Then COVID-19 hit , and Returnly started to grow like crazy. You have to be ready to grow massively because it is not that easy. Many were interested in the company, but Edu was particularly fascinated by Affirm and its team.Before closing this deal, both Edu and Maria, alone in San Francisco with three kids and a puppy, get COVID. And once again, nothing was going to stop him from getting his dreamt deal.When Edu shared with us that the deal was done via whatsapp, it was very late at night in Miami, and Teddy and I immediately called Edu and Maria. To our surprise, it was just like any other call, we just couldn’t believe it. We asked them:

"so what are you going to do now?"

and Edu replied,

"we really need a new fridge, ours is over 35 years old and doesn’t work.”

Not only had he negotiated with Affirm with COVID, the whole family and the dog were living in their garage because the house was being fixed. Isn’t that funny?In their hardest moment, magic happened, sick with COVID, no family, house under reconstruction.....When we had to wear the investor/founder hat, we did, when we had to wear the family one, we did. When any of us needed help, we got it. I bet there are thousands of beautiful stories out there of investors and founders becoming friends, and this is one of them. As this is our #1 exit, I wanted to talk about it from the perspective of the humans behind the business. About choosing to sacrifice more instead of quitting, about sometimes choosing the heart over the brain.As founders we have to choose our investors by always envisioning the type of relationship we’re going to build over time, it is not just the capital what drives the decision. People talk about not taking business personally, well, we didn’t take it personally - we made it personal when it was needed, and it worked. Even if Returnly had not been successful, the learnings of the constant rollercoaster we went through would have been incredibly valuable.

To close the loop, Edu told me that he would be honored to invest in TheVentureCity’s second fund.

Wow, how powerful is that? One of our founders is now supporting the next wave of entrepreneurs through our Fund…...Isn’t this the best validation an investor can get?

We gave him a first ticket, invested in every round and now he’s giving us a first ticket for our next Fund, so we can keep supporting more Edu’s all over the world.

Thank you Edu, Maria, Marcos and Sharon!