What were your biggest learnings from your time at Wrapp, AdProfit and HDWR from bootstrapping through to scaling a business internationally?
My main takeaway when looking holistically at my founder years is that there is a huge range of differences on the entrepreneurial path and many of them can be incredibly rewarding in their own unique way. How you define success as an entrepreneur is not always determined by being a keynote speaker at the largest tech conferences and sweet-talked by brand-name investors. There can be endless satisfaction from controlling your own destiny and moving slowly. Even though I represent the VC-backed path today, I feel society often forgets to salute the many small businesses that never aspire to grow exponentially and have a huge exit but are still essential to our economy and the lives of millions.
As the IPO window arguably starts to open, do you see LP’s becoming less cautious, albeit that for some smaller VC’s limited new capital from backers could be too little too late?
The world’s most sophisticated LPs and VCs do not try to time market, and are long venture as an asset class. Exit windows come and go, startup hype comes and goes, but when investing at the early stages you are always ~10 years away from exits so there’s no reason to try and time macro. Instead, remain consistent in your deployment. Having said that, as IPO windows open up there will be liquidity for LPs which oftentimes will circulate back into the asset class which can fuel the deployment. There are also family offices and similar LPs who are a bit more sensitive to the macro environment and may have pulled back from venture these last 2 years, who will be excited to get back in again when they see exits. This will definitely help smaller and newer VC firms greatly.
‘US startups also attracted 73% of the $42.5bn invested in the global AI sector last year, according to data firm CB Insights.In such a US dominated world, Britain is at risk of becoming little more than a research offshoot’ (FT 17.05.24).Do you agree?
The fact that US startups attracted 73% of the $42.5 billion invested globally in AI indicates a significant disparity in investment although the anomaly with this data is the concentration of investment in a few outlier companies, namely OpenAI, Anthropic, xAI and so on.
The UK and Europe has a vibrant AI research community and is home to some of the world’s leading universities and research institutions, which contribute to significant advancements in AI. The Creandum funds recently invested in French AI company H’s $220M seed round, founded by 4-ex Deepmind employees to develop a new generation of multi-modal-to-action models. We strongly believe Europe will play a key role in the future of AI and the 2 primary hubs seem to be London and Paris.
With Accel,Bessemer,General Catalyst,Left Lane Capital,Lightspeed Venture partners,MassMutual Ventures,Sequoia and Andreessen Horowitz active and Creandum raising 500m Euro’s in record time,do you see the green shoots of recovery appearing in European Tech ecosystem?
The 2023 State of European Tech report points to “green shoots of recovery” in the ecosystem after the downturn of 2022, with public markets rallying and the ecosystem value bouncing back to its historic high of $3 trillion.
There are specific pockets where Europe performs well, including in climate where there has been a dramatic increase in funding, accounting for around 30% of all capital invested in European tech in 2023 (see also our report with Dealroom last year on the European Ascendancy). Europe has minted over 350 new unicorns since 2014 and has a pipeline of 3,900 growth-stage tech companies with the potential to become the next generation of success stories.
If we look at our day to day, we’ve never been more busy. There are so many exciting opportunities in Europe.
Do you push your portfolio founders to pivot fast in the absence of product market fit or do you allow them to figure it out?
The key is finding the right balance – giving founders the autonomy to navigate the product-market fit journey while providing the data-driven insights and strategic guidance to help them make the best decisions for their business. Pushing too hard for a pivot can be counterproductive, but so can sticking to a failing strategy. It’s about striking the right balance for each unique founder, startup and situation. However, where a startup cannot compromise is around speed! This is the ultimate advantage you have against the large incumbents of your industry. We always push our portfolio to optimize for speed – test quickly, iterate quickly, learn quickly, move quickly. Sometimes that leads to a pivot, and other times not.
