Jan Claudio Muñoz went from being a child refugee to becoming a VC partner. Backbone Ventures / Getty Images / Dominik Schmitt for Gründerszene
Pachacamita is not a real place. At least not for Jan Claudio Muñoz – because the 40-year-old has never seen the Chilean village from which his father comes. Nevertheless, it left an impression on him: so much so that he named a 20 million euro fund after it. The 5502 Fund – 5502 is the zip code of Pachacamita – is only distributed to founders with a migration background. How much identity politics can an investment fund tolerate? “Zero,” says Muñoz, “that’s not what it’s about. My job is to increase money.” He simply believes that migrant-run startups are better suited for this than the many “bio-German” founders.
He explains why in an interview. We also talk about which type of founder Muñoz avoids, which founder photo makes him “immediately out” as an investor – and how, after more than twelve years in the startup scene, he still notices that he is a refugee child.
Muñoz conducts the conversation from home, in Frankfurt’s Nordend, in front of the black and white background of his VC: The pre-seed VC Backbone Venture has been around since 2018, and Muñoz has been a partner for three years. The 5502 Fund is his “brainchild”; it is intended to finance “underrated overperformers” from Germany and Switzerland.
The fund was founded in times of crisis: It looks for virtues in its founders that are appropriate to such times, says Muñoz – and finds them especially in migrants.
Less event hopping, more hustle mentality
Muñoz offers an example: At some point, as a grown man, mind you, he started having his beard cut at the barber. “My father gave me such an enema,” says Muñoz, “since then I’ve been doing it myself again.” A saying that his father can’t help but say on such occasions: “We come from Pachacamita. Not from Hollywood.”
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Pachacamita has fewer than 500 residents, one of whom was Muñoz’s father until 1974, who fled to Germany as a politically persecuted person. Patricio Muñoz works hard – but at some point he has to get support from his son because his employer suddenly demands knowledge of English: Patricio Muñoz doesn’t speak English, but his son, then 16, does. “We always had enough of everything, it’s not a maudlin ghetto story,” says Muñoz. It’s a lot of hard work.
The VC investor says he told his partners at Backbone about this sentence about the Chilean mountain village and the American dream factory. “That’s exactly the attitude we want to see in our founders,” they say: hard work, instead of fancy Insta posts and offices in prime locations, “people who worked on the product, are frugal, even when things are going well says Muñoz. Hence the name: 5502 Fund. The fund was founded during the crisis: for the Frankfurt resident, it was the dawn of a new era in which “money no longer flows as absurdly quickly” as it used to.
Are founders with a migration background the better entrepreneurs in these new times?
Muñoz believes: maybe. He doesn’t just mean people with a migration background, it could also be women who have made their way in male-dominated areas. That’s what’s really important to him: having made it through.