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04 February 2014

Venture Capitalist on the Pit Wall 

Sometimes venture capital firms have to get really hands on with their investments. That’s certainly true for Luxembourg’s Genii Capital, where co-founder Gerard Lopez has just become principal of the Lotus F1 Team.

UK-based Lotus, one of the most venerable names in auto racing, lost team principal Eric Boullier to rival McLaren in mid-January. Lopez, accustomed to fine tuning the operations of portfolio companies, will now have the additional task of overseeing the fine-tuning of the Lotus race cars.

With Mangrove Capital Partners, Lopez was an early-stage investor in Skype before co-founding Genii Capital with Eric Lux in 2008. The following year they took a controlling stake in the Renault racing team, adopting the Lotus name in 2012.

Formula One brings together the world’s best racers and the most advanced technology. Genii has deftly combined its position in the sport with its experience as a technology investor to attract sponsors and partners. For example, the company has partnered with triple Formula 1 champion Jackie Stewart to build bridges between tech companies and the racing industry.

Now Lopez must get his two drivers, Venezuela’s Pastor Maldonado and the highly-rated Frenchman Romain Grosjean, acquainted with the E22, Lotus’s new race car, which has made headlines with its radical split-nose front end.

Over the past couple of years, Lotus has struggled to balance its budget. The arrival of Maldonado and his ample sponsorship from Venezuela’s state oil company should help. But Lopez will have his work cut out trying to catch Red Bull Racing and its star driver Sebastian Vettel of Germany, world champion for the past four years, when the 2014 Formula One season starts on March 16 in Australia.

Win or lose, Lopez believes strongly in the synergies investment firms can find between seemingly unrelated industries. No doubt private equity house CVC Capital Partners, which owns Formula One’s commercial operations and also has operations in Luxembourg, would agree.