Philip Johnston found his sweet spot for building an empire of ecommerce brands. His startup has already raised $46M, and is growing fast.

During his appearance on the Dealmakers Show Johnston shared how he prepared himself and found the path into entrepreneurship. Plus, his experiences in M&A and fundraising. As well as the future of ecommerce and doing business in developing economies.

Listen to the full podcast episode and review the transcript here.

Preparing For Entrepreneurship

Philip Johnston was born in the UK before moving to South Africa as a child. His father was posted in Cape Town as a diplomat at the end of the apartheid era where hee was instrumental in the change by funding black entrepreneurs around the time that Nelson Mandela was getting out of prison. 

On returning to the UK, Philip grew up in a countryside village, and found a love for math. He says that he was drawn to math because he seemed to have a talent for it, and it didn’t require the memorization of his other classes, like French. 

Still, even then he wasn’t expecting to go into finance. He didn’t see that as being intellectually challenging or interesting. Instead, he thought he would go into pure math, and become an officer in the British army. 

He began that training, but ended up landing an internship with Goldman Sachs. Which completely changed his trajectory. 

His experience on the trading floor totally changed his perception of finance. He was in the middle of the action. Everyone was screaming and shouting, sitting in front of 10 screens each, and he got to see $10B being traded every day. 

Instead of going into the army, he decided to get his Masters degree in Mathematical Finance. There he learned more about stats, pattern recognition, and identifying trends. 

In turn that decision took him into working in venture capital and consulting. Together, with his banking experience he held several of the cornerstones of the background of many highly successful entrepreneurs. 

Venture capital provided great insight into what it takes to get funded as an entrepreneur. Especially when it comes to ensuring that you have a big TAM. 

Consulting gave him the ability to break down problems, and to learn to communicate. 

The networks he built through these years have also proven valuable. He says that it often gives you just one degree of separation from anything you need. Like VCs with capital. You’ll find you can get introductions through your LinkedIn network, and then have some credibility when VCs look you up, and conduct their due diligence.

It also gives you a motivating network. People you know, went to school with, or worked with are out there Creating Unicorn Startups of their own. 

Trying to further break down the math of the path to being a successful entrepreneur, Philip says he spent a lot of time reading and researching. He found that Google and McKinsey had consistently produced the most unicorn founders. So, he chose to go to McKinsey which had the highest number per employee.

Instead of going into the army, he decided to get his Master’s degree.

There he learned more about stats, pattern recognition, and identifying trends.

In turn, that decision took him into working in venture capital and consulting. Together with his banking experience, he held several of the cornerstones of the background of many highly successful entrepreneurs.

Venture capital provided great insight into what it takes to get funded as an entrepreneur. Especially when it comes to ensuring that you have a big TAM.

Consulting gave him the ability to break down problems and to learn to communicate.

The networks he built through these years have also proven valuable. He says that it often gives you just one degree of separation from anything you need. Like VCs with capital. You’ll find you can get introductions through your LinkedIn network, and then have some credibility when VCs look you up and conduct their due diligence.

It also gives you a motivating network. People you know, went to school with, or worked with are out there creating unicorn startups of their own.

Trying to further break down the math of the path to being a successful entrepreneur, Philip says he spent a lot of time reading and researching. He found that Google and McKinsey had consistently produced the most unicorn founders. So, he chose to go to McKinsey.

Startup Fundraising

When COVID hit he saw all the big retailers scrambling. They had no foot traffic in their stores any more. McKinsey created their own ecommerce ‘war room’ to help get these retailers online. At the same time he was reading about how aggregators in the United States were raising a lot of money, and finding a lot of profitability. 

Philip connected with a VC fund in Berlin about the idea on a Friday. By Monday morning he had scrambled to do all the research on this market, but in the Middle East. He modeled it out, and pitched them. 

They bought into it, and provided funding, providing he took on a cofounder with ecommerce experience. Within a week he had quit his job, and had raised a $4M seed round. 

They’ve since gone on to raise $46M through their Series A, including a $25M debt facility.

Storytelling is everything which is something that Philip Johnston was able to master. Being able to capture the essence of what you are doing in 15 to 20 slides is the key. For a winning deck, take a look at the Pitch Deck Template created by Silicon Valley legend, Peter Thiel (see it here) where the most critical slides are highlighted.

Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.

Opontia

Philip’s startup Opontia acquires and scales ecoommerce brands in the Middle East, and Eastern Europe. 

They found many entrepreneurs had built reasonably good brands, with their own websites or third party marketplace platforms. They may get to the point where they are making $100K a month in profits, but then are faced with a whole new level of business. Many don’t want to go through everything it will take to really go through that. 

So, Opontia buys them outright, and gives the founders a financial exit, and the freedom to move onto something new. Under Opontia’s umbrella, the brands and products are aggregated and scaled. All using the efficiency of their combined warehouses and logistics. 

Opontia has found its edge outside of the West. They’ve established infrastructure that gives them a competitive advantage and moat from competition. 

In the past year they have acquired around 9 brands, and have grown to four countries. They have a presence in Istanbul, Warsaw, Riyadh, and Dubai. 

Looking forward they expect to grow into the Czech Republic, Romania, Denmark, Sweden, Nigeria, Egypt, Kenya, and Pakistan. 

Of course, there are many differences and challenges in moving into markets like these. Marketing is always a major piece of the puzzle. Including figuring out which social media platforms really have an influence in these local markets. Then dealing with those were homes still don’t have addresses, and consumers are used to paying cash on delivery.

Listen in to the full podcast episode to find out more, including:

• The process of buying and scaling companies
• How to refer brands to Opontia and earn
• How to get a valuation of your own company
• Philip’s top advice for others considering entrepreneurship

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