Diary of an entrepreneur: How LatAm Autos founder Tim Handley is driving a $72m auto classifieds company into the fast lane
Friday, January 23, 2015/
Melburnian Tim Handley didn’t take the decision to quit his job as a successful investment banker and found a business in South America lightly.
“Leaving the corporate world in your home market is a scary prospect, [but] to do this in an emerging market adds another level of uncertainty,” Handley tells SmartCompany from his home base in Ecuador.
After having worked for seven years in investment banking, Handley decided to relocate to Brazil for a job opportunity at an asset management company in 2009. But surrounded by the possibilities of an emerging Latin American online market, Handley was looking to salsa to the beat of his own drum.
“More than anything the attraction of being an entrepreneur was for me the ability to control my own destiny and know that each hour of work I put in, and ultimate success – or failure – would be attributable to me,” he says.
Having advised some of Australia’s leading companies on mergers and acquisitions opportunities in the Latin American market, the aspiring entrepreneur discovered that unlike back home, there was a wide gap in the auto classifieds space. Indeed, there was no regionally dedicated online auto classifieds player at all.
“Being from Australia, where some of the most successful single vertical companies such as Carsales.com.au, REA Group and SEEK have now become global leaders in online classifieds, we understood the potential of applying a proven business model to such a large market,” says Handley.
The killer idea and a market ready in waiting sealed the deal. Handley launched LatAm Autos with co-founder Gareth Bannan in 2012.
“In the end we saw an opportunity that was too good to pass up,” he says.
Fast forward just two years and that opportunity is now valued at a market capitalisation of $72 million, after having raised $18 million in fresh investment from floating the company on the ASX last month.
From across the South Pacific, the 36-year-old chats to SmartCompany about the differences in Australian and Latin American business culture and why being an entrepreneur means accepting you might not ever go on that ski trip.
Frequently travelling across Latin America, Handley says his morning schedule can easily be interrupted by travel and jetlag, but when he can, he likes to start the morning off with some exercise.
“Typically I try to exercise in the mornings prior to work, but prior to this I will always check if any urgent emails have come through overnight given our company operates with significant time zone differences,” he says.
Depending on which country, hotel or Airbnb apartment he’s in, Handley says he tends to eat a lighter breakfast compared to what he would have woken up to down under. However, there are some Aussie touchstones he will always rely on.
“Fruit in Latin America is amazingly fresh and cheap so I will typically start the day with that and the obligatory tube of Vegemite always makes its way back from Australia for the odd piece of toast,” he says.
Given that LatAm Autos is currently integrating several acquisitions across Latin America, which includes the $6.5 million purchase of Demotores – the number one industry player in Mexico – Handley says his travel schedule means he never has a typical day.
But he says as executive chairman of the company, his day largely involves defining strategy with the chief executive and chief financial officer, communicating with various directors, and being responsible for investor relations and new business opportunities.
“As such, I spend a lot of time on Skype, seeking new business opportunities and liaising with investors and brokers,” he says.
LatAm Autos now employs around 120 employees across six countries – Mexico, Argentina, Ecuador, Peru, Panama and Bolivia. But Handley says any cultural clash he’s experienced as an Australian has mainly been down to communication and differs in severity from country to county.
“Considering all of the countries I have worked in, Brazil is the toughest to do business from a bureaucracy and cultural point of view. As an example, to set up a company in Brazil takes around six months and involves endless paperwork, whilst in Mexico we were able to set up a company within three weeks,” he says.
While Handley says the company boasts a flat structure, he admits the IPO has affected LatAm Autos’ company culture.
“Without a doubt there are many new considerations that come with being a listed company as opposed to private,” he says.
“Having continuous disclosure requirements and publicly released results means that certain protocols are put in place and we are very aware of delivering on the strategy we presented at the IPO.”
Because of the demanding nature of working with people across two different time zones in Australia and Latin America, Handley says his work-life balance can at times be a struggle.
“I brought my brand new snowboard from Australia in 2009 intending to visit the ski resorts in Chile and Argentina, but have not used it once, which is a sign that work has generally been a high priority since choosing the entrepreneur path,” he says.
And because of the IPO and acquisitions, Handley says he took no more than a handful of days off last year. But when he does get a moment to himself, you’ll likely find him going for a swim or surf, enjoying Latin American food or simply just watching a movie.
“I find that in non-English speaking countries, going to the cinema and seeing an English speaking movie is quite therapeutic,” he says.
Handley’s top priorities for 2015 are to integrate all the newly acquired operations into LatAm Autos, as well as implement its new business model. But he says the company’s end goal is to be the go-to for car ads in Latin America.
“Our long-term goal is to be the dominant number one site in each market,” he says.
Asked whether he has an exit strategy, Handley wouldn’t be drawn on his own plans, but says the opportunity that LatAm Autos requires persistence over a long time frame.
“For now we are focused on working hard to become the dominant auto classifieds company in Latin America, excluding Brazil,” he says.
“The size of the opportunity is obvious with a target population of 222 million in our markets. Compare this to Australia’s 23 million population and the fact that Carsales.com.au has a market capitalisation of $2.49 billion.”