Author: Toby Hicks

Four benefits of backing more diverse startup founders

The worldwide startup ecosystem is well established and growing strongly in many different territories. The success of Angel Investment Network in creating more connections between founders and investors globally is testament to that. However, while investment in startups has rebounded strongly after the worst of the pandemic, we can also follow this with an increase in funding for diverse startup founders. Why does this matter? Well, it’s not just about having better representation for the sake of it, important though this is, it actually also makes better sense commercially.

In the UK while just 5% of founding teams have two female founders, research has also shown that only 1% of venture-funded startups have black founders. It’s a similar picture in the USA, where according to Crunchbase, black startup entrepreneurs still received only a tiny fraction — 1.2 percent — of the $147 billion in venture capital invested in U.S. startups through the first half of the year.  To disrupt this, here are four reasons why we need to boost investment into more diverse founders.

  1. It can lead to new business opportunities
    Many diverse business startups can offer products targeting diverse consumers uncatered for currently in the market. However, if the investors themselves are not more diverse, they may not have the same understanding of the market to know where the opportunities are. This is a challenge many female founders also face. For example, we can purchase most groceries online except ethnic food – which you still have to visit your local market, small grocer or if you’re lucky, there will be a small selection in the supermarket however, it’s unlikely you can order online. As this is a minority need many would struggle to get backing from a British bank however, Mariam Jimoh founded Oja, developed an app that delivers ethnic produce from local groceries to customers’ doorsteps. After much hard work, she was successful in finding funding. As one of only a handful of success stories here, we know there are many other missed opportunities to serve a potential market of many millions.
  1.  New markets can develop and thrive
    New markets thrive on having dynamic businesses and competition. However if certain businesses are unable to grow, their products or services remain in need and the circulation of money in the economy then shrinks. We can create opportunities to serve different markets, have more alternative viewpoints in the business decision and drive forward education and revenue based around new business variations which cater for wider groups. Let’s also remember these are emerging and growing markets too, so there are fantastic opportunities for investors with the right foresight.    
  1. More diverse teams do better
    Just as in nature, having diversity is key to the health of ecosystems, the same applies to diverse teams in startups and wider existing businesses. Research has shown that companies with diverse management teams are more innovative and have 19% higher revenue. In many of the fastest growing sectors such as tech, this growth is key to success. So diversity is not just about a tick box activity, it’s about the make up of high performing teams, who are going to positively impact the bottom line. The reverse is also true. The more we can represent the whole of the country and their different needs, the better solutions we can develop and ensure new markets can flourish. 
  1. Backing more diverse founders across the globe can help tackle some of our greatest challenges
    Of course while it is important to look at backing more diverse founders at home, we also need to look at more diversity in funding globally. So much capital is concentrated on a few established, wealthy hubs. However, having more underrepresented founders across the globe we can also potentially have new insights and ideas for tackling many of mankind’s most pressing problems. People on the ground in countries most impacted by climate change may well have some more untapped and innovative solutions, but often they need the contacts and capital to turn their idea into reality. By looking at ways we can boost nascent startup ecosystems in developing countries, we will be in a better place to address many of the problems threatening the planet with sustainability based solutions which could become hugely profitable.

So where to start? The first thing we need to do is look at how we can support micro-enterprises. They are on the very first rung of the startup ladder and the more of these we can support, the more chance of startups on a pathway to Series A and even Unicorn status can emerge. This is why Ace Entrepreneurs has created our first micro funding program for the diverse community. While we have seen a huge democratisation of startup funding in the past few years, we now need to complete the journey and make sure a truly diverse startup ecosystem can flourish.

By Nadine Campbell, entrepreneur and founder of Ace Entrepreneurs. The ACE Entrepreneurs Investment Program has been launched to tackle a funding gap for black-owned businesses. 

Tips from the top: Raising investment

In our recent survey of startups in the UK and USA raising investment was raised as the number one challenge they faced, emerging from the pandemic. In the first of our new series of expert advice articles, David Pattison, experienced angel investor and leading media agency PHD founder, gives his top tips for those raising investment for the first time.

I have spent a lot of time chairing/advising young businesses and founders on how to approach fundraising.

It has always struck me that, at the very point when young businesses and their founders are looking for funding, you are at your most inexperienced and vulnerable. You are often in a negotiation dealing with very experienced deal makers. This negotiation is often pivotal to the future of your business. One bad clause signed up to in an early negotiation can magnify in size as time and fundraising rounds go on.

What can you do to try and even up the negotiation?

Before you start remember these three things:Investors only care about one thing and that is their money. In the case of Venture Capital and Private Equity that is how they are measured. They have clients who fund their funds and financial success is how they are judged and how they can then raise more funds. They want you to make money for them.

Raising money is hard. Right now there is a lot of money in the investment market, but you have to have a good business and a really strong offering to raise money. Young businesses seem to be lulled into believing there is a money tree at the bottom of the garden that just needs a shake. There really isn’t.

Raising money is really distracting. It takes focus away from the business and most companies suffer a slight drop in performance through this process. Just at the point where it’s not wanted. Share the load around and take advice from trusted sources.

Once you have got your head around that, what else can you do before and during the process?

Here are five of the many things you should do:

1. BE THE BEST BUSINESS YOU CAN BE

It sounds obvious I know, but investors are looking harder and deeper into prospective investments. You will need to present yourselves as the best business you can be. Showing that you understand all aspects of your company and your markets.

You need to be a well balanced and appropriately experienced team with a shared view of the future. Have a proof of concept (does it work?), ideally some revenue (is someone prepared to buy it?) and will they buy it more than once. A good understanding of the competitive set. If appropriate some IP protections. Most importantly that you are in control of the finances of the business and have good quality finance resource.

If some of these points describe your business, then you are well prepared for the questions the prospective investor will expect you to answer.

2. do not get close to running out of money

Never leave it too late to raise funds. Investors will sense if you are running out of money and will try and delay the completion so that they can ‘chip’ the deal just before closure.

Leave yourself plenty of time. Never underestimate how long it takes to raise money, allow 6-9 months if you are looking for serious money. Try to give yourselves options. Taking money from the least worst option is never good.

3. RUN YOUR BUSINESS AS IF YOU ARE ALWAYS ABOUT TO ENTER DUE DILIGENCE

Prepare, prepare, prepare. It sounds obvious but make sure you know your business and your market better than anyone. Do not take fundraising lightly. In the digital age it is easy to set up a data room that has all the company data in one place. Have good governance in place. Get the financials and the legals in order. Remember that DD is not a one-way street when you are raising funds then check out the potential investors.

4. be clear on what you want to achieve

This works in two ways. Firstly, be clear amongst the team on what you want for the business moving forward. Are you all aligned on the future strategy and exit points? Mixed messages to investors don’t travel well.

Secondly, when the time comes to raise the money be very clear to the investors what the money is for and what success looks like. Not many investors want to fund cash shortfalls and saving the business, and if they do it usually comes at a massive cost to you. They are called investors for a reason.

5. beware of deal fatigue

When you are in the fundraising process be aware of deal fatigue. Investors, and particularly the institutional investors rely on you running out of steam. If your chosen investor is a significant shareholder, they will be a big part of your business life. You don’t have to love them but make sure you respect them and their motives.

Very often management get to a stage in the process where they just want it done. They agree to a deal without looking at every last detail. This is where investors can add the hidden clauses that bite you in the future. Stay attentive and on the way through make sure you share out the workload amongst the team.

One final piece of advice. Everyone I speak to who is involved in fundraising says the same thing, ‘get the best lawyer you can afford’. Don’t be afraid to upgrade as you go through the investment stages. A good lawyer should be seen as an investment and not a cost. They will also do a lot of the legwork on the legal documents for you and keep you focussed and avoid a lot of the pitfalls.

As I said right at the start of this, fundraising is not easy, and you should take all the constructive help you can find. I have been involved in a lot of fundraising.

If this blog has been of any help, then you might be interested in reading my book: The Money Train: 10 Things young businesses need to know about investors. It’s a guide to preparing for the investment process from seed capital to Series A, with lots of real-world examples. Whatever route you take to raise funds I wish you good luck and success.

David Pattison has had a long and illustrious career in the advertising industry and as an angel investor. He co-founded PHD in 1990 and more recently he has been involved in a number of startups in a range of industries including, marketing, publishing, construction, motorsport, AdTech, MarTech, FinTech, production and broadcasting. He was recently announced chairman of Conversational media platform Octaive.

Angel investment Network announces launch of Institutional investment arm, AIV Capital

Ethan Khatri

London-based Angel Investment Network, the world’s largest online angel investment platform, has announced the launch of its Private Equity and Venture Capital division, AIV Capital.

Led by experienced investment manager Ethan Khatri, AIV Capital will invest between $10 -$75Mn+ into established businesses ranging from Growth/Series B to pre-IPO and has a flexible approach utilising both primary and secondary capital. Its sector agnostic focus will be on strong management teams with a demonstrated edge in the space they operate in. 

AIV Capital Managing Director, Ethan Khatri brings 16 years of investment experience across the European and Asian venture markets. Over the course of his career, he has successfully completed 27 transactions achieving 13 exits, covering technology, enterprise software, pharmaceuticals, healthcare and consumer. He will be combining his experience with AIN’s early stage market coverage and portfolio of businesses they’ve historically funded. 16 year old AIN has a global network of more than a million entrepreneurs and more than 280,000 investors, winning investment for a host of powerful businesses including What3Words, Simba Sleep and SuperAwesome. 

According to Mike Lebus, founder of Angel Investment Network: “AIV Capital is the natural next stage of AIN’s evolution. AIN has been a game changer in democratising access to angel investment and powering the dreams of so many startup founders on the first stage of their fundraising journey. With the right experience and team in place, led by Ethan, we are now able to support businesses right through the fundraising cycle, from the idea in a bedroom to seed funding right through to pre-IPO.” 

According to Ethan Khatri: “AIV Capital is a powerful new force in private equity and venture capital. Building on the evergreen network of AIN, our experienced team has access to an extraordinary talent pool of growth to late stage businesses which we can match with the right funding structure to ensure they deliver absolute return opportunities. Our watchword is flexibility. We invest across the capital structure and this is the method by which we maximize returns for all stakeholders.” 

Ends

Majority of US startups very optimistic about the next 12 months

A majority of US startups (52%) are now ‘very optimistic’ about the next 12 months, despite 62% seeing business growth negatively impacted by the pandemic. This was a key finding of a new study of US startup sentiment 18 months after the start of the pandemic, by Angel Investment Network (AIN). The study of 1,205 US based startups found 76% expressed optimism overall with 19% quite optimistic and 52% very optimistic, versus just 24% who were pessimistic. It followed on from a similar survey we conducted of UK startup sentiment last month.

The results show the extent to which confidence has returned to early stage businesses Stateside, who are emerging strongly from the downturn. Of the 62% of respondents who revealed they had been negatively impacted by COVID, 37% had been ‘very negatively impacted’. Meanwhile 63% of those who had been planning to raise funds said they had delayed a raise as a result of COVID.

Top strategies to mitigate the impact of stalled fundraising were: Focusing more on networking, favoured by 46% of respondents, holding off launch plans (38%) and bootstrapping instead (32%), with a similar number delaying marketing.

Entrepreneurs were also asked what their biggest challenges were going forward. The top result given was raising investment (84%), hiring/recruiting the right talent (22%) and product development (22%). Ongoing COVID issues were a problem for 13% of those polled. 

US startups also believe more Government action is needed to encourage investment and help startups flourish. 57% favour making tax relief more generous to boost angel investment, 32% making R&D tax relief more generous and 22% lowering corporation tax. 70% of respondents are confident the US will retain its place as a startup hub.

AIN has seen surging growth on its platform with connections between entrepreneurs and investors up by 23% since the start of the year. Meanwhile revenues have increased by 40% to a new record, indicating the huge pent up demand from startups now seeking funding. 

According to Mike Lebus, founder of AIN: “It is encouraging to see how US startups have shown their mettle to ride out this really difficult period and emerge battle tested and with high levels of confidence. Many have been negatively impacted but have used their time wisely to build up their pipeline of contacts and bootstrap their businesses as far as they can go. RaIsing investment remains the biggest challenge going forward and as the world’s largest angel investment platform, we have been encouraged by seeing a record number of connections between investors and startups.” 

How did you respond to the pandemic?

  1. Focused more on networking: 46%
  2. Held Off launch plans: 38%
  3. Bootstrapped instead: 32%
  4. Delayed marketing: 32%
  5. Held off making hires: 27%
  6. Had to let staff go: 20%
  7. Relied on business loan: 19%
  8. Pulled back from R&D: 12%

What could the Government do to help?

  1. Make tax relief more generous to boost angel investment: 57%
  2. Make R&D tax relief more generous: 32%
  3. Lower corporation tax: 22%
  4. Offer more clarity on COVID restrictions: 14%
  5. Make it easier to provide VISAs for recruiting the right talent: 13%

What are your biggest challenges going forward?

  1. Raising investment: 84%
  2. Hiring/recruiting the right talent: 22%
  3. Product development: 22%
  4. Ongoing COVID issues: 13%
  5. Consumer sentiment: 12%

Behind the Raise with eleXsys Energy

Richard Romanowski is co-founder and Executive Director of eleXsys Energy. eleXsys has developed a unique, international award-winning, enabling technology that will drive the transition of global energy grids to a clean energy future.

Tell us about eleXsys and how you came up with the idea?
My co-founder, Dr. Bevan Holcombe, was a senior engineer at an Australian distribution utility with 30 years’ experience and was working on how to decarbonise the local suburban grid.  I was a cleantech angel investor, looking for fabulous ideas.

The biggest issue to local decarbonisation is that the grid was designed as a one way grid. Bevan was trying to find a way to solve this problem, that is, the very limited grid hosting capacity of renewables due to the one-way grid design. He could not find a solution anywhere so in 2012 we decided to team up and started a company now called eleXsys Energy to solve this problem.

eleXsys in simple terms turns the one-way grid into a two-way grid in a cost effective manner enabling a huge increase in local renewables that the grid can host or accommodate in each suburb.

When we started eleXsys, Bevan and I had a vision that discovering a way to turn the one way grid into a two-way grid would be our contribution to saving the Great Barrier Reef by speeding up global distribution grid decarbonisation.

Over the last 9 years eleXsys developed a unique, international award-winning, enabling technology that will drive the transition of global energy grids to a clean energy future.

Why did you decide to raise investment?
The co-founders, Bevan and Richard, are the initial high net worth investors.  We invested over $7.5 M USD of our own money.  Then some friends and close associates also invested almost another $4.0 M USD.  We had developed an MVP (Minimal Viable Product) and a few field demonstrations and planned a slow organic and affordable commercialisation, starting in Australia. Then slowly going global as we knew Australia was a few years ahead of the rest of the world in terms of grid hosting capacity problems due to so much rooftop solar we have Down Under.

Then we won the World Energy Council (WEC) global start up award in 2019. When we won the award, the WEC Secretary General at the time (Christoph Frei), challenged us as follows, he said:

“This technology is game changing; you need to think 100 time bigger” …. that is, we need you to help speed up global decarbonisation and fast!

Since 2019 that is what we set out to do, and in that vein, we needed much more investment to speed up commercialisation and go global faster.

What is your top tip for anyone raising investment for the first time?
It’s never easy, the 1st time or the 10th time. Be prepared to spend a large amount of time raising funds and listen and learn from every pitch. If they say no, ask why. Always be raising and expect to pitch to 50 or more before you hit any jackpot.

What attracted investors to your company?
The IKEA flagship project in Australia which helped investors realise how eleXsys can radically speed up global decarbonisation in the local suburbs.  The IKEA project represents a microgrid at up to 10 times bigger than what current Smart Invert technology and grid constraints would allow.  So up to 10 x greater energy savings for the tenant, up to 10 x more rooftop rent for the landlord, plus up to a 10 x larger $ project for the asset owner (e.g. solar and battery power plant) to earn a secure, uncurtailed ROI over 20 years.

My biggest fundraising mistake was…
Not listening at first to potential investors.

Why did you choose to use Angel Investment Network?
A very supportive, understanding, and innovative group with a focus on ESG (Environmental – Social – Governance) investing. We are now raising our Pre IPO round.

What has the funding enabled?
The main focus was fine tuning our global expansion plans through our planned licensing model. Licensing allows us to scale global quickly as opposed to originating, developing, and building microgrid projects ourselves, which would be a very slow and cumbersome process.

Through licensing our vision is that eleXsys becomes the “Intel Inside” of the global local renewables supply chain.  That is, almost everyone is using eleXsys in their local suburban renewables projects to speed up global decarbonisation.

Did you know that filling every roof with solar could generate > 120% of Australia’s total electrical needs? Same should apply across the global sunbelt ≈ 75% of world’s population.

Cannot be done – local distribution grids will not integrate this much distributed energy due to grid physics limitations (curtailment) due to one-way grid design

Grid curtailment of DER (Distributed Energy Resources) begins to occur when the utility hits ≈ 15% of customers with DER, making projects non bankable .eleXsys cost effectively solves this fundamental problem one-way grid problem.

So far, we have one Master Licensee MOU signed and are negotiating with four more. Plus, established a few Alliance Partners licensees within Australia to be the sales channel and EPC of projects.  Some of the Alliance Partners are global multinational using Australia as a test bed eleXsys licensee, with the intention to then become a global licensee.

Plus the funds are being used to enhance our manducating capability along with recruiting more staff to support the faster growth.

Cleantech energy company eleXsys Energy raises £640,000 through AIN

eleXsysEnergy has raised £640,000 through Angel Investment Network, the world’s largest online angel investment platform. eleXsys Energy has developed a unique, international award-winning, enabling technology that will drive the transition of global energy grids to a clean energy future. The eleXsys® technology enables large commercial and industrial rooftops to become grid-connected, solar power plants. eleXsys® is the critical enabling technology being installed to build the IKEA eleXsys Microgrid at IKEA Adelaide, which will become 100% powered by renewable generation by 2025.

The raise took four months and was part of a larger £5m funding raise, including a Series A round of  £3.55m, with the funds allowing the business to continue its investment as it rapidly grows its global reach. eleXsys Energy’s innovative technology unlocks the full potential of electricity networks to host multiple times more clean, distributed energy without expensive network infrastructure upgrades. By providing services that enable a two-way flow of electricity on grids, the platform supports the most efficient, low-cost means of delivering clean distributed solar or wind energy.

The company originated in Australia but has now reorganised and is headquartered in London. This is eleXsys Energy’s first raise overseas and marks a significant step for the company.  The company has over 270 customers including 11 industrial rooftops across schools and government, agricultural and commercial buildings. The raise will allow the business to continue to invest in its technology as it rapidly grows its global reach.

According to Richard Romanowski, co-founder and Executive Director, of eleXsys: “We are delighted to have completed a successful round of fundraising with Angel Investment Network. Our technology is critical for the transition to clean energy – one of the world’s most pressing challenges. Funding from investors across the world confirms the transglobal appetite for investment opportunities in new cleantech solutions, aiming to tackle global carbon reduction targets. We are a rapidly growing business and with the capital raised, we will be able to further drive our strategic plans for expansion and deliver on our goals for our new and existing investors.”

According to Sam Louis, Head of Consultancy at Angel Investment Network: “We are excited to be working with eleXsys Energy in this period of significant growth for the company. This raise ensured that eleXsys secured the backing of strategic and experienced investors as they expand their global reach and make their mark on international markets. Our passion-driven investors want to support businesses that solve real problems and there’s arguably few greater problems to solve than how to dramatically scale the move to clean energy.”

News of the raise has been covered in the media both in the UK and internationally including: UKTN, TechLoop Europe , UK Tech Investment News, Growth Business, Eminetra and 24htech Asia

FOCUS ON SUSTAINABILITY

The US Government recently made a headline-grabbing commitment to a 50% reduction in carbon emissions, while the UK committed to an even steeper 78% carbon reduction by 2035. So the question on everyones’ lips is how to achieve this while ensuring economic growth continues? The solution to marrying a low carbon future with answering our continuing energy needs lies in innovation and the ideas of many brilliant startups now seeking funding.

For our latest in depth focus article, Olivia Sibony, CEO of SeedTribe takes a look at sustainability and the development of startups that have the power to help save the planet. Olivia has recently been recruited by the Government to advise on the impact-focused startups we should be encouraging to set up in the UK.  

THE NUMBERS

Size of market
The global Green Technology and Sustainability market size is anticipated to grow from USD 11.2 billion in 2020 to USD 36.6 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 26.6% according to Report Linker 

On the platform
– Renewables became the 11th most popular keyword for searches in the past year, a rise of 37 places compared to 2018. 
– This trend is being replicated by other popular keywords being used at the moment. During the pandemic Greentech became the 13th most popular keyword, up from 47th two years ago.

What is the reason for the soaring interest in sustainable focused startups during the past year?

I think the change really started snowballing in 2019. The mood music had changed on the back of consumer activism and changes to government policy. From Greta Thunburg to the Extinction Rebellion there was a concerted effort to ensure climate change became top of the agenda. It worked. Governments and businesses suddenly started making dramatic commitments to cutting carbon. While it might have been expected that investors would be retreating from these categories in favour of safer investment opportunities during the pandemic, the exciting news was these businesses are actually generating more interest from investors. 

Concerted government policy worldwide is certainly helping, along with increasing grants from the UK Government to stimulate innovation in this space. In order to hit these ambitious targets, innovation will be critical. Investors know this and so are backing the early stage startups with the vision to help governments and business in general hit these ambitious targets. We are also seeing something of a shift in the investor profiles, with some younger millennial investors coming to the fore who have purpose very much as their watchword. For many investors, rather than a ‘nice to have’ having purpose baked into their business plan is becoming a prerequisite for receiving backing.

What are investors saying about sustainability?

Investors are starting to see ESG measurements and reporting being embedded into listed companies and realising that the more they invest in companies that do this from the outset, the better chance they have of succeeding as they scale. It’s important to note that a lot of investors are interested in this segment but struggling to understand it, as there’s a sliding scale of shades of grey in what the “impact” and investment spaces, ranging from profit-first to impact-first. 

Our belief is that there shouldn’t need to be a compromise, so that profit and purpose are perfectly aligned and inextricably intertwined. The key difference is that it’s important to take a long-term view as some of the growth may be slower, but in the long term it’s more sustainable so has a better horizon for long-term profit. So investors are interested in this space but need help understanding the change in growth curve. When investors understand that growing consumer demand (culture), coupled with an increase in regulation (policy, systemic change) are driving this growth, it’s a clear path for investment for anyone looking beyond a three year horizon for their investments.

What innovations are most needed to power sustainability?

The three key areas of focus should be circular economy, carbon-capturing technology and renewable energy. We need a big focus on the entire food and agriculture chain where farming needs to capture carbon, food should be produced as close to home as possible, vertical farming practices are further developed, food surplus becomes minimal and a resource to turn into energy. Where water from agriculture is clean and no longer contaminates our waterbeds. We need to focus on trapping heat emissions from carbon and methane in order to slow down the melting ice caps. The quicker the ice caps melt, the more gases and unknown bacteria and viruses will be released and the harder it will be to reverse. We’ve already seen the impacts of one single lone virus and this should be a good incentive for us to not release unknown ones that have been trapped in our ice caps for millennia and have potential to cause incalculable damage. 

CASE STUDIES

Zoï environmental network uses its technology to treat and monitor wastewater systems, especially cleaning fats from public drains and pipes. Their core product is an environmentally-friendly system which doses special bacteria to the wastewater system and degrades the fat molecules in the system. The system prevents the development of fatbergs in the sewer & wastewater systems, allowing cleaner water to flow through our systems. Check out this Video of them.

Bionat Solutions is a Certified organic solution applied in the waxing process of fruits, with the aim of providing a longer shelf life without using fungicides or artificial products. The novelty is in the circular alternative made from the same agroindustry residues to increase the useful life of fruits.

Biohm is a multi-award-winning research and development led, bio-manufacturing company. The company enables the use of healthy, environmentally friendly, circular materials like food waste and transforms it into building solutions which can apply across the design and construction industries. This eliminates the concept of waste, demonstrating how business can equitably and ethically work in collaboration with the natural world, industry, academia, government and community.


Zero Carbon Farms has developed a data-driven system 70x more productive than traditional farmland. It uses 100% renewable energy, 70% less water and reduces food miles/food waste. Not only is the produce consistent quality, highly nutritious and herbicide-free, it is also hyper-local and year-round, specialising in subterranean farming.

Join Olivia Sibony on Thursday June 3rd in the next AIN ClubHouse ‘Business as a force for good’ session where she will be discussing how startups can pave the way to a zero carbon future for food production.

Five takeouts from our first sessions on ClubHouse

As a communications professional it is imperative to keep abreast of new trends and platforms. ClubHouse is the newest kid on the block, delivering something quite different in today’s social media landscape. Part networking platform/ part radio show/ part events business/part members’ club it has an intriguing proposition. It offers something quite different to other social networking platforms. Namely the ability to have a really informed discussion on topics of interest where your ‘real’ self is exposed, rather than curated.

In a world of anonymous trolls spewing bile from behind keyboards being able to talk with real people on a platform also represents a refreshing change. It is focused on the ‘voice’ and offers an ability to network and debate that we used to have from live events. Remember them? For me personally it has also been a nice change from having to see your own face on a screen during a stilted Zoom conversation. Particularly with hairdressers being closed for so long! The discussions I’ve seen and taken part in so far have been wide ranging: Mental health, building resilience, social media techniques, how to win investment, even the Burning Man festival. 

As an online network connecting hundreds of thousands of people from across the world it also offers a perfect opportunity for us at AIN to bridge distances. Our own channel startup.fm has featured some fascinating discussions so far and I wanted to pick out five great revelations from our guests so far.

  1. True grit separates those who succeed with those who don’t
    In our first conversation we heard from Thomas Vosper, founder of ecommerce startup aisle 3 on how he bounced back from redundancy 13 months ago. He has since led two successful funding rounds with a rapidly growing ecommerce businesses employing 15 staff across several continents. In winning funding and growing his business in the teeth of the pandemic,  he epitomises the character and determination startup founders need. A great revelation we heard that epitomises this was setting his alarm at 3 in the morning to respond to investors in Australia in real time. He is an expert in his field but this sheer level of focus and determination is what sets successful startup founders apart. It’s a tough business and it simply isn’t for the majority of people. Investors know this and character counts.

  2. Being prepared to pivot
    There can simply be no time for rigid thinking in the BETA world of the startup. Accepting things are in transition is a brilliant starting point for throwing off attachments and being ruthless in decision-making. This revelation came from Rav Robert from PharmaSentinel, the healthcare startup leveraging AI to provide personalised medicines data intelligence. He revealed the story of presenting his initial wireframes for his app to a board advisor with relevant experience. The blunt feedback was to ditch the initial idea and return to the drawing board. Rav realised quickly he needed to take this advice on board and adapt. Indeed this was why he had recruited this particular advisor. The result? Having launched its consumer app ‘medsii’ (Medicines information for Me) in October 2020 on the App Store & Playstore. It already has over 15,000 app downloads in 150 countries. The lesson was not be emotionally attached to any one idea and trust the advice of the experts you have brought on board. 

  3.  Don’t be too distracted by investors
    This might seem anathematic for those involved in a fundraise, but this was the loud and clear message from Saalim Chowdhury, former partner at 500 Startups and an angel investor. His strong contention was not to be distracted by the thought of investment rounds. Instead entrepreneurs should have a laser-like focus on winning customers and sales in the early stages and should bootstrap as far as possible. Paradoxically, the best way to impress investors was not being over focused on them. As he succinctly put it ‘Taking investment is as time consuming as setting up a business.’ Dan Simmons, founder of launch accelerator Propelia also thought it was vital to really focus on milestones early on and work with the right investors to help guide this process. His view was that there was a lot of inefficiency in the early stages of fundraising and it was really important for startup founders to be matched with the right investors as ‘co-pilots’. 
  1. Engage your community in your journey 
    This came through so loud and clear from several speakers. Saalim emphasised the benefit of crowdfunding –  not so much for gaining investors but building a community and gaining customers. For Ruari Fairbairns from One Year, No Beer, building a strong tribe and community was vital for the development of his app of alcohol-free evangelists and the direction of travel for the business. It is also easy to forget that investors can also be customers. Indeed he he was able to raise £1.6m of investment from his community. This included many corporate leaders who had taken on his booze-free challenge and seen the benefit in their life and productivity. A brilliant way of building advocacy.
  1. Opposites attract when it comes to co-founders
    Another great misconception is that cash is the reason startups fail. Several guest shared the view that it is the people dynamic that it most critical. While solo founders can succeed a succession of speakers and participants extolled the virtues of having co-founders with complementary skill sets, such as Kathryn Tyler and Nikki Cochrane from Digital Mums who joined us in week one. This was something Thomas also said was the ‘secret sauce’ in his working relationship with his business partner, James Valbuena. For solo-founders the advice was recruiting advisors and mentors who can offer skills you may not have. The message in effect was to acknowledge your weaknesses and rather than try to correct them, find someone who excels in those tasks. 

    We look forward to more great insights and revelations in future weeks of ClubHouse. Please join Adah Parris, Chair of MHFA UK, Olivia Sibony, CEO of SeedTribe and Michael Solomon, Director at Responsible 100, on Clubhouse tomorrow Thursday, 28th April as we discuss, can business be a force for good?https://www.joinclubhouse.com/event/mWreGdga

Toby Hicks, Head of PR, Angel Investment Network

Coffee on Purpose with Liv Sibony

Liv Sibony, CEO of SeedTribe and Head of Impact at Angel Investment, recently spoke on the Coffees on Purpose podcast about how start-ups can marry profit with purpose, what we need to do to support the next generation of start-ups to address the UN’s Sustainable Development Goals (SDGs), and why female entrepreneurs are still underrepresented in this area.

From sharing with us some of the most exciting start-ups in the space, like Pinpoint, who are using big data and hundreds of thousands of blood samples to help detect early signs of cancer, to deconstructing some of the structural imbalances in the current investment space, Liv gives a comprehensive overview of the impact space, and what’s on the horizon. 

Watch the podcast here.

Breaking the cycle – how female-led startups can succeed in 2021

Bumble’s recent IPO generated stellar headlines for making Whitney Wolfe Herd the world’s youngest self-made female billionaire. However it was the exceptionalism of the story that made it so significant. Women make up about half of the global population but account for less than 5% of the world’s 500 biggest fortunes, according to the Bloomberg Billionaires Index. 

In order to have more women at the top of the list there needs to be more investment and encouragement going into early stage startups. The UK has one of the most developed startup ecosystems in the world. Yet it falls down when considering the huge gender imbalance in the startups winning investment. Indeed research from the British Bank shows that for every £1 of Venture Capital investment, all-female founding teams get just 1p.

This matters from both a moral, fairness perspective but also from the end consumer perspective. According to research from Catalyst.Org, 67% of all UK Household consumption is controlled or influenced by women. However their needs are often unmet in a world where so many products and services are brought to market without the input of 50% of the UK. Across the country there are so many entrepreneurial women with brilliant ideas for gaps in the market to improve our lives, but these are likely to remain unfulfilled. The lack of funding opportunities and visible role models makes the ideas more likely to remain in heads. Not least because you can’t be what you can’t see. 

As a result of Covid, the situation has become even more precarious. Firstly investors are more likely to stick with more established businesses, more likely to be male-led. Secondly the bulk of domestic responsibilities (including childcare) tend to fall on women, simply meaning there has been less time and ability for many to focus on the all consuming life of launching a business. Home schooling has been a clear example. In order to shake things up and start to rebalance the situation we should focus on practical measures women can take.

Develop a wide network

Start-up investment has traditionally been a very closed world. Much of it stemmed and often still does from old school ties which tend to be stronger with men. This is then often reinforced throughout our lives. Platforms like Angel Investment Network, SeedTribe and crowdfunding platforms have undoubtedly helped to shake things up by democratising the world of early stage investing but it remains crucial for women to focus on building their own networks. Encouragingly there are a host of forums for women to network and create their own forums. This includes investment groups such as Angel Academe, which trains and empowers women to invest in female-owned start-ups and Ada Ventures which invests in under-represented founders; the Female Founders Forum, set up jointly by Barclays and The Entrepreneur Network (TEN), or more specialised groups such as Hatch’s incubator for first-time female founders and the Mayor of London’s Women in Cleantech group. Once you know groups are out there, you can then focus on the one or ones that are right for you. 

Being bolder in pitches and asks

Some research from Barclays revealed Britain’s female entrepreneurs are less likely than men to ask for business funding to scale up operations. We are also likely to be more timid in pitches. We need to be direct and ask for what we need to get a business the launchpad it needs. In my personal experience investors will buy into the vision and ambition. Remember investors are expecting to be asked for money. Tell them in no uncertain terms the amount you require, what you will do with it and of course, the share they can expect. You will be surprised by how positively your request will land.

Doing your homework on the investor

Switching perspectives so we can understand the right argument to make is one of the best and most simple steps we can do to boost our chances of investment. When I launched my start-up GrubClub I realised the importance and power of understanding different perspectives. I would then adapt my pitch according to the investor I was speaking to. Key to this was really researching each investor, including their background and interests.  This helped me understand the different reasons they might invest. It’s also helpful to ask the investor directly about their prior investments. This isn’t rude. It is a two way street. The investor will conduct Due Diligence on your company and you, and you should also feel comfortable to Due Diligence on them as an investor. However at the same time, it’s important to be flexible and open to other approaches, but never to the detriment of what is fundamental to your company.

Backing other women

In instigating change, we need to be the change we want to see. It’s up to women to support other women in the industry. This is the only way to disrupt an entrenched system. Having launched and sold my own business, I dedicate my time to supporting impactful entrepreneurs to grow in more sustainable ways. My strong conclusion is we need successful women to become investors themselves to shake up the system. If we can encourage more women investors, we will start to see the level of funding increase for female-led startups. This will in turn create a virtuous circle of successful female entrepreneurs who are likely to become female-backing investors themselves.

 However, support doesn’t just include fundraising. It is also about opportunities for offering mentoring or other support. The individual power we all have is far greater than we realise. Let’s be the catalysts for the change we need to transform the prospects for female entrepreneurs.

Olivia Sibony is CEO of SeedTribe and Head of Impact for Angel Investment Network