Personalities

The Clone Collector: Meet New York Superangel Fabrice Grinda, Master of Digital Knockoffs

An eBay for France, a PayPal for Brazil...
fabrice grinda The Clone Collector: Meet New York Superangel Fabrice Grinda, Master of Digital Knockoffs

Mr. Grinda speaking at LeWeb 2011. (flickr.com/leweb)

Fabrice Grinda, the French-born Internet mogul best known for duplicating American companies across the globe, is taller—6’3″—and handsomer than he looks in his hundreds of pictures online, with thick eyebrows a few shades darker than his hair. He speaks rapidly and pronounces almost every word, including “entrepreneur,” in a near perfect American accent. “Ultimately, I was not a super creative guy,” he said, resting his arms behind his head and propping one smooth leather loafer on the edge of the coffee table in his sparse Chelsea office.

In 1996, Mr. Grinda was a 21-year-old analyst at McKinsey & Company, where he watched the Internet bubble inflate from his small, windowless office and worried that he might miss his chance to strike it rich. Problem was, he didn’t have any ideas. That’s when he decided innovation was overrated.

“Screw creativity and originality,” he recalled telling himself. “I’m going to take a U.S. idea and bring it to Europe.”

As an entrepreneur, Mr. Grinda copied eBay for France. Then he copied a European business selling cellphone ringtones for the U.S. He now runs OLX, a Craigslist knockoff he founded that is now bigger than Craigslist itself. By night—and in sporadic meetings throughout the week—he’s a so-called superangel, with 96 investments.

The majority of his portfolio? Clones. “Copies of established ideas,” he clarified. “‘Established,’ meaning $100 million in sales for the original model, and profitable or on a clear path to profitability.” Among his investments are a Diapers.com for Russia, a Grubhub for China, a Diapers.com for Germany, a Jetsetter for Turkey, a Stubhub and Eventbrite for Spain and Latin America, a Warby Parker for France, and an Airbnb, an Expedia, a Gilt and a PayPal for Brazil.

Mr. Grinda invests in 25 start-ups a year, and an introduction from him guarantees a full round. About a third of his portfolio comprises original ideas based in the U.S. But for the rest of the world, it’s clones only.

Bryan Ellis, a close friend who met Mr. Grinda at McKinsey, recalled his friend’s ambitions as a 20-something: drive a fast car, meet a nice girl, save Africa, and have $100 million by the time he was 30.

“My nickname for him is ‘the Great Grinda,’” Mr. Ellis said. “It’s not the Great Gatsby, it’s the Great Grinda. Gatsby had a great house and a lot of money and a lot of friends, but at the end he kind of lost track and faltered. With the Great Grinda, he also has a great house and has wonderful parties and a lot of friends, but he’s the real deal.”

In 2008, Mr. Grinda was essentially kicked out of his Long Island home for hosting paintball games in the garden. In 2010, he gave up an apartment at 19th and Park that he’d rented in order to host parties, with dozens of friends coming over for poker or wine-fueled political discussions. Mr. Grinda’s get-togethers inspired the building to pass several new regulations, including a prohibition against asking the doorman to enforce a guest list. One fete attracted more than 400 attendees. But apparently it was the wiring of the apartment with speakers for a salon that included a private talk by Matthew Bishop, the New York bureau chief of The Economist, that really irked building management. “I got kicked out of my apartment in the city for the hosting of these more-or-less intellectual parties,” Mr. Grinda said. As a result, he lived out of the Mercer Hotel for 18 months, before renting a manse in Bedford with a padel court and 20 acres of land, as well as an apartment at 1 Madison Park.

Mr. Grinda wasn’t always quite so convivial. He was reserved as a kid, because he wanted to be taken seriously by adults. “He was very introverted,” recalled Alexandra Merle-Huet, a childhood friend who now lives in New York. “He was almost, like, too smart to interact with anyone.” She recently reunited with Mr. Grinda and was surprised to meet the bubbly and gregarious version. “He talks a lot and he’s not shy, and he’s very comfortable around women,” she said. “The new Fabrice is like, ‘I’m fabulous!’”

The new Fabrice is a product of Mr. Grinda’s mechanical mind. When he got to McKinsey, he noticed that the most successful people there were not the smartest, but rather the most personable—so he systematically copied their extroversion. In one exercise, he asked 10 women out a day for 100 days. Nine hundred fifty-five nos later, the prospect of rejection seemed less terrifying. “I went from an ISFP to an ENTJ,” he said, meaning a reversal on every trait measured by the Myers-Briggs personality test. “I really worked hard at improving that.”

“He has these wonderful grand ambitions,” said Einat Wilf, Mr. Grinda’s officemate at McKinsey and now a member of the Israeli Knesset. She recalled how Mr. Grinda would take 20-minute “super power naps,” in the office, stretched out diagonally, so he could fit. “He wants to run the world,” she said. “He has the notion that he could be an enlightened ruler.”

Mr. Grinda moved to the U.S. in high school and studied economics at Princeton, where he collected awards and graduated with the highest GPA in his class. He paid for his studies through arbitrage, buying computers in the U.S. and selling them in Europe, and had enough left over to purchase an apartment on the Lower East Side and invest in four stocks: Yahoo, Amazon, Microsoft and Intel. Selling these assets later provided the seed money for his first company, Aucland, an eBay for France, in 1998.

Aucland raised $18 million, a record in France at the time, but did little better than break even. Still, since then, Mr. Grinda has made a career of what he calls “idea arbitrage.” His second company, a European knockoff called Zingy, sold pop hits as ringtones. To familiarize himself with his customers, Mr. Grinda read People and US Weekly regularly. After a year of dire struggle, the company took off. In 2004 Mr. Grinda sold Zingy to a Japanese company for $80 million and never had to work again.

“I think I saw him a week later,” said Bessemer Venture Partners partner Jeremy Levine, who first met Mr. Grinda when they both worked at McKinsey. “He made gobs and gobs of money. I said, wow, what are you going to do with that money? He said, ‘The first thing is, basically kick my brother out of my rented apartment and get my own place. The second thing is, I’m going to get a flat-screen TV.’ In my head I sort of did the math and that meant basically 99 percent of the money was left over. ‘And then what?’ He said, ‘I’m going back to work.’”

Work meant finding another business to clone. Humans all have the same basic needs, Mr. Grinda believes: they want to be entertained, they want to communicate and they want their lives to have a semblance of meaning. If a company fulfills one or more of these needs, he believes it will be successful anywhere in the world.

We wondered if there was something wrong with all this. After all, isn’t copying like… cheating? Mr. Grinda’s army of copycats call to mind that cluster of dueling Indian restaurants in the East Village that have all appropriated the same decor—tangles of chili-shaped string lights hanging from the ceiling—after the success of some forgotten original.

What happened to building a better mousetrap?

Although most entrepreneurs profess to be flattered by copying, cloning is still largely viewed as dishonorable. “Do something original or don’t do anything at all,” founder Jason Goldberg blogged when the seventh clone of Fab.com pushed him over the edge.

The infamous Samwer brothers, a trio of Germans who made hundreds of millions by cloning trendy companies like Fab and Pinterest, have earned a reputation as “evil bastards” with whom it’s only possible to do business “with my back against the wall and a machine gun in my hand,” as one source put it.

Given that Mr. Grinda’s youngest brother, Olivier, is CEO of one of his Brazil-based knockoffs, where are the stories about the evil Grinda brothers? Fabrice, who likes to call himself an “entrepreneurial thief,” said he’s taken some flak from start-ups that are possessive of their ideas. Yet he’s avoided becoming a larger target because he’s more discerning than the infamous Samwers, who have launched more than 100 pixel-for-pixel clones. “I like him a lot,” Gilt CEO Kevin Ryan wrote in an email without a trace of annoyance, despite the fact that Mr. Grinda invested in ripoffs of two of his companies. “Very smart guy.”

Besides, Mr. Grinda would argue that he is building a better mousetrap. The first iteration of OLX looked like Craigslist with a different color scheme and a smaller typeface. Today OLX looks like OLX, and offers email alerts, smartphone apps and other features Craigslist doesn’t have.

Mr. Grinda does all his investments with fellow angel investor and entrepreneur Jose Marin, who jets between London and Madrid. They met when Mr. Grinda was building the eBay of France and Mr. Marin was building the eBay of Latin America.

For most of their deals, the two are passive investors. Up to four times a year, they structure the deal and lead the round. Once a year, they create a company. They come up with the target for idea arbitrage, recruit the team and give the founders 30 percent equity. Olivier is the CEO of one of these prefab companies, Shoes4You, a ShoeDazzle for Brazil.

“People sometimes say, ‘Hey, you go out there and copy things,’ and I mean, I just think that’s unfair,” Mr. Marin said. “It’s like if someone builds Coca-Cola and someone in Mexico builds Pepsi. The truth is that building a business in different markets is not that simple. It’s not copying. If it were just copying, everyone would go and do it.”

Maxim Faldin is the cofounder of Wikimart, one of Mr. Grinda’s first investments, which started out as an eBay for Russia but has evolved past the auction model. “You don’t need to invent Twitter in China,” he said. “You copy Twitter and adjust, and be better than Twitter in China and compete with Twitter itself.”

He hesitates even to use the word “copy,” he said. “We import ideas and we adjust them,” he said. Mr. Grinda and Mr. Marin won’t invest in “some small company that is unproven,” although others do. “Samwer brothers do even that,” he said. “They copy everything.” There is, apparently, some honor among thieves.

A version of this story appeared in the New York Observer the week of April 18, 2012.

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