Ernesto Schmitt

Ernesto Gottfried Schmitt (born August 1971) is an American-born entrepreneur and investor of German-Uruguayan descent. He is co-founder of The Craftory, an VC fund supporting cause-driven challenger brands in the consumer goods space.

Ernesto Schmitt
BornAugust 1971 (age 49)
Cincinnati, Ohio, United States
NationalityGerman, Uruguayan
CitizenshipAmerican, German
Alma materUniversity of Cambridge
INSEAD
OccupationInvestor
Entrepreneur
Known forThe Craftory, Beamly
DriveTribe, Fabula AI, Silverscreen, Peoplesound
Children2

Born in Cincinnati, Ohio to a German father and Uruguayan mother, Schmitt was raised in Brussels and Mexico. Schmitt earned his degree from University of Cambridge in manufacturing engineering, graduating top of class. He attained an MBA from INSEAD.

Initially starting his career as a management consultant, in 1999, he founded Peoplesound – the first digital music streaming service – during the Dot-com boom, which was sold to Vitaminic in 2001. Later going on to found Silverscreen, the first specialist DVD high street retailer. More recently, he founded Beamly, the second screen platform sold to S&P 500 component Coty, Inc., and DriveTribe alongside Richard Hammond, James May and Jeremy Clarkson. Schmitt co-founded Fabula AI, which was sold to Twitter in June 2019.

Early life and education

Schmitt was born in Cincinnati, Ohio. His father was a Vice-President at Procter and Gamble. His maternal Grandparents are the Uruguayan actress Nelly Weissel and artist Juan Fernando Vieytes Pérez, he is also descended from the Schmitt family on his father's side. Schmitt grew up in Brussels and Mexico.[1] His father was from Germany, and his mother from Uruguay.[2]

After attending high school in Brussels, Schmitt enrolled as a full-time student at the University of Cambridge, studying engineering and subsequently graduating top of Cambridge. He holds a Master of the Arts from Cambridge (BA/MA). After a year consulting for Boston Consulting Group, Schmitt received a Master of Business Administration (MBA), with distinction from INSEAD in Fontainbleau, France.[3]

Business ventures

Peoplesound

Schmitt founded Peoplesound, an online music store and streaming service in 1999 and ran it until 2001, when acquired by Vitaminic[4][5] Peoplesound was one of the earliest platforms for digital music in the world.It offered customers two  free songs from every band as a taster and then invite customers to create their own compilations in CD Realaudio or MP3 format. It also famously offered artists £100 to join. The business primarily focused on observing user behaviour around their engagement with music to help the music industry better understand and target consumers. Peoplesound raised money based on a valuation of around £70m, from investors including Finnish wireless communications operator Sonera Corporation and venture capital firm Zouk Ventures. Earlier backers include French billionaire Bernard Arnault's Europe@Web.

Peoplesound's Italian-owned rival music website, Vitaminic, bought Peoplesound in 2001 in a deal worth €34m (£20m). The deal was financed partly with cash and partly with the issuing of 1.3 million new Vitaminic shares to Peoplesound shareholders. Peoplesound retained its brand name and website. Schmitt was quoted as saying to the BBC, "The combination of massive online distribution, e-commerce, music publishing, commercial licensing and value-added services resulting from the merger of the two companies means we will take leadership in the technology revolution reshaping the traditional music industry."[4][6][7][5]

Silverscreen

Schmitt founded Silverscreen in 2003 alongside Sebastian James.[6] Starting from an initial six stores in 2003, Silverscreen was the United Kingdom's first specialist DVD high street retailer offering an extensive selection of chart and non-chart products.

Apax backed the original launch of Silverscreen in 2003 with £3.5m of funding and followed it up with a secondary fundraising of £20m in 2004 to help finance the company's ambitious plans to open 160 stores. The company received ~£33M total in funding and turnover in excess of £85 million. [6][7]

Beamly & Zeebox

In April 2011 Schmitt founded the Zeebox second screen service, later renamed Beamly, along with Anthony Rose who had previously headed up the BBC iPlayer project between 2007 and 2011.[8][9]

The service was original launched in October 2011 by Zeebox Limited, a British company,[10] originally called tBone.[11]

In January 2012, BSkyB bought a stake in Zeebox and announced plans to integrate the software with its offering.[12] In September 2012, Zeebox announced expansion into the US with a commercial partnership with Comcast Cable, NBCUniversal, Viacom and HBO. Comcast, NBCU and Viacom also took minority equity stakes for undisclosed sums.[13] In November 2012, zeebox launched a joint venture in Australia with Network Ten and Foxtel.,[14][15]

In October 2015, Beamly was acquired by Coty, Inc.[16] for an undisclosed amount.[17]

Drivetribe

DriveTribe is an automotive online community platform founded by Schmitt, alongside The Grand Tour presenters Jeremy Clarkson, James May and Richard Hammond. The platform features different automotive-themed 'tribes' which people can join, post to, live chat with members of and share content on[18] The website launched in November 2016 with a few selected tribe members.[19] Financing for DriveTribe came from, among others 21st Century Fox and Breyer Capital, who have invested respectively $6.5 and $5.5 million in the platform.[20][21]

The Craftory

Schmitt Co-Founded The Craftory, a global investment house based in London[22] with Elio Leoni Sceti[23] as an alternative to traditional Venture Capital.[24][25][26][27] The current fund size is $375 million[28] in permanent capital and the firm only invests in ‘Challenger Brands'.[29][30]

Other Positions

Schmitt previously worked for EMI Music[6][7][8] as President of EMI Music's catalogue division and President of Global Marketing. In 2018, Schmitt Co-Founded Fabula AI, which aimed to solve the problem of online disinformation, or 'Fake News' by looking at how it spreads on social networks[31][32][33][34][35] Twitter announced its acquisition of Fabula AI for an undisclosed sum on 3 June 2019.[36][37][38][39][40][41]

Personal life

He has two children, living in London[42]

References
  1. Levy, Katherine (28 June 2012). "Zeebox on a mission to revolutionise TV viewing". Campaign. Retrieved 30 December 2015. Background: Half-German, half-Uruguayan, born in the US, grew up in Belgium and Mexico.
  2. Tagliabue, John (5 May 2000). "Sprechen Sie Technology?; Europeans Try to Relax Borders for Skilled Workers". The New York Times. Retrieved 30 December 2015.
  3. "Ernesto Schmitt, CEO & co-founder, Zeebox" (Changing Media Summit: Speakers 2012). The Guardian. 5 December 2011. Retrieved 30 December 2015.
  4. "Vitaminic" (Factfile). Crunchbase. 3 June 2018. Retrieved 3 June 2018. The Headquarter was based in Italy and after the Ipo in 2000 on the Italian Stock Exchange it acquired companies in UK ( Peoplesound)
  5. Tagliabue, John (5 May 2000). "Sprechen Sie Technology?; Europeans Try to Relax Borders for Skilled Workers". The New York Times. Retrieved 30 December 2015.
  6. "Ernesto Schmitt, CEO & co-founder, Zeebox" (Changing Media Summit: Speakers 2012). The Guardian. 5 December 2011. Retrieved 30 December 2015.
  7. "EMI Music Appoints Ernesto Schmitt as President, Catalogue" (Press release). 6 November 2008. appointed Ernesto Schmitt as president of its catalogue business, reporting to Elio Leoni-Sceti, EMI Music's chief executive. He will join EMI next month. … DSG International, … group development director. From 2006 to 2008, he worked at Tesco as group ordering director, … Prior to that he was joint chief executive and founder of Silverscreen, … From 2001 to 2002 Schmitt was EMI Group's senior vice president of strategy and business development. Prior to that he founded peoplesound.com, … began his career at Boston Consulting Group … for four years.
  8. Kiss, Jemima (3 February 2013). "Zeebox founder and former iPlayer boss Anthony Rose on the future of TV". The Guardian. Retrieved 30 December 2015.
  9. "BBC iPlayer's Rose returns with social TV app Zeebox" (Blog). Financial Times. 31 October 2011. Retrieved 30 December 2015. Mr Rose co-founded Zeebox in April with Schmitt. The company initially raised £5m in venture funding from undisclosed angel investors.
  10. Robert Andrews. "Revealed: How Anthony Rose Plans To Revolutionise TV".
  11. John Moulding. "Anthony Rose reveals some details of his new project tBone".
  12. "Zeebox strikes major investment deal with Sky". www.campaignlive.co.uk.
  13. Andrews, Robert (27 September 2012). "NBCU, Comcast buy in to Zeebox". paidContent. Archived from the original on 1 October 2012. Retrieved 4 October 2012.
  14. "Foxtel signs Zeebox deal in second screen first". Retrieved 16 March 2013.
  15. Smith, Paul (11 July 2012). "Ten brings Zeebox social TV to Australia". The Australian Financial Review. Retrieved 16 March 2013.
  16. "COTY Announces Acquisition of Leading Global Digital Marketing Platform Beamly". Coty. 18 October 2015.
  17. "Coty Acquires Content Agency Beamly As It Gears Up for P&G Deal". Retrieved 26 March 2018.
  18. Fane Saunders, Tristram. "What is DriveTribe? All you need to know about Jeremy Clarkson's 'YouPorn for cars'". the Telegraph. Retrieved 29 November 2016.
  19. Davis, Ben. "We take a spin through Clarkson, May & Hammond's DriveTribe network". Econsultancy. Econsultancy media. Retrieved 30 November 2016.
  20. Lee, Kristen. "DriveTribe Just Got $6.5 Million From Fox And We Don't Know For What". jalopnik. Gawker Media. Retrieved 12 September 2016.
  21. "Drivetribe raises $12m Series A from Breyer Capital and Fox". Tech City News. 6 September 2016. Archived from the original on 28 March 2017. Retrieved 27 March 2017.
  22. Roderick, Emma (19 June 2018). "The Platform Wars are Over: Now Comes the Battle of the Brands". lafosse. Retrieved 23 August 2018. Ernesto's latest venture is 'The Craftory,' an investment vehicle aimed at backing the world's boldest challenger brands in the consumer goods space. The Craftory is self-consciously not a fund – rather, it is an 'investment company,' which Ernesto describes as 'anti-corporate' and 'anti-VC.' Whatever you may wish to call it, the Craftory has $300 million in its back pocket, and is set to make waves across the FMCG market..
  23. Coyne, Andy (14 May 2018). "Investment newcomer The Craftory to focus on challenger brands". Just-Food. Retrieved 22 August 2018. Craftory was founded by technology entrepreneurs and investors Elio Leoni-Sceti and Ernesto Schmitt.
  24. Alves, Jose Luis (11 May 2018). "GP Investments investe US$60 mi em empresa de marcas de consumo". Exame/Reuters. Retrieved 23 August 2018. São Paulo – O grupo de private equity GP Investments anunciou nesta sexta-feira que sua subsidiária Spice Private Equity assinou um contrato para investir até 60 milhões de dólares na empresa de bens de consumo The Craftory.
  25. Farman, Madeleine (15 May 2018). "Spice commits $60m to new consumer goods platform The Craftory". Realdeals. Retrieved 22 August 2018. Spice commits $60M to The Craftory.
  26. Wastell, Kenny (14 May 2018). "Spice PE in $300m deal for The Craftory". Unquote. Retrieved 22 August 2018. Spice Private Equity has agreed to invest up to $300m in The Craftory, a newly-formed UK-based investment group focusing on consumer goods, alongside other investors.
  27. Boscolo, Rodrigo (11 May 2018). "GP Investments announces the launching of The Craftory". GP. Retrieved 22 August 2018. The Craftory is a revolutionary concept: a new investment company dedicated entirely to backing disruptive new challengers in the consumer goods space.
  28. Daneshkhu, Scheherazade (14 May 2018). "The Craftory looks to back upstarts in fight against consumer giants". Financial Times. Retrieved 22 August 2018. Now, an investment group launching this week aims to nurture more of what it calls these “ disruptive challengers toppling lumbering giants ” by pumping $300m of private capital into the growth and development of upstart consumer goods companies.
  29. Daneshkhu, Scheherazade (19 June 2018). "How millennials' taste for 'authenticity' is disrupting powerful food brands". Financial Times. Retrieved 22 August 2018. He co-founded The Craftory, an investment group launched last month to help challenger companies grow.
  30. Daneshkhu, Scheherazade (12 July 2018). "The Craftory aiuta le start up nella lotta ai colossi dei beni di consumo". Il Sole 24 Ore. Retrieved 22 August 2018. Molti grandi consumer group negli ultimi anni hanno costituito propri fondi capitale come mezzi per individuare e investire in nuovi trend: tra questi vi sono le aziende alimentari Mars, Kellogg's, Danone, la distilleria Diageo e Unilever, la società di prodotti alimentari e per la cura della persona. Ma The Craftory – il cui logo è una lupa che cerca con lo sguardo e con occhi simili a laser i suoi «cuccioli investimenti» – si considera essa stessa un gruppo di concorrenti, tanto quanto le aziende nelle quali spera di investire. «Si pensi al numero incalcolabile di fondi di investimento, con personale e uffici prontamente rimpiazzabili. Ecco, noi cerchiamo di proposito di essere diversi», ha aggiunto Schmitt.
  31. Spangler, Todd (3 June 2019). "Twitter Buys Artificial-Intelligence Startup to Help Fight Spam, Fake News and Other Abuse". Variety. Retrieved 8 June 2019.
  32. "Twitter Buys London Start-Up Fabula AI". Silicon UK. 3 June 2019. Retrieved 8 June 2019.
  33. "Twitter's new 'Fabula' fake news finder hints at more anti-conservative bias". Washington Times. 3 June 2019. Retrieved 8 June 2019.
  34. Lomas, Natasha (6 February 2019). "Fabula AI is using social spread to spot 'fake news'". TechCrunch. Retrieved 8 June 2019.
  35. Puckett, Lily (3 June 2019). "Twitter buys tech start-up that claims to quickly spot fake news". The Independent. Retrieved 8 June 2019.
  36. Waters, Robin (7 June 2018). "These were the 10 biggest European tech stories this week". tech.eu. Retrieved 8 June 2019.
  37. "Twitter (TWTR) Acquires Fabula AI". Streetinsidert. 3 June 2019. Retrieved 8 June 2019.
  38. Cohen, David (3 June 2019). "Twitter Acquired Fabula AI to Continue Its Push Toward Platform Health". Adweek. Retrieved 8 June 2019.
  39. Dingan, Larry (3 June 2019). "Twitter acquires Fabula AI, aims to 'improve health of the conversation'". ZDnet. Retrieved 8 June 2019.
  40. Lomas, Natasha (3 June 2019). "Twitter bags deep learning talent behind London startup, Fabula AI". TechCrunch. Retrieved 8 June 2019.
  41. "Twitter acquires British AI startup to address fake news". Irish News. 3 June 2019. Retrieved 8 June 2019.
  42. Levy, Katherine (13 February 2017). "Zeebox on a mission to revolutionise TV viewing". Campaign. Retrieved 28 June 2012.
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