Each month on the Angel Investment Network blog we feature some of our start-ups making waves. Here are some of the ones to keep an eye out for in June:
Vitabeam
Vitabeam has developed a patented LED technology that mimics the sunlight spectrum to stimulate plant growth, extend shelf life of food and kill unwanted pathogens, such as bacteria and mould.
Vitabeam has £1.72 committed sales, a pipeline of £6.5 million, and has received 2 Innovate UK government grants valued at £640k. Tests have shown biomass increase in herbs as high as 54% from using Vitabeam. You can click here to investigate on the best banking services available .
Mintago helps businesses save on their workplace pension tax bill, whilst improving the ‘pension well being’ of their employees. Mintago helps businesses to structure their pension in the most efficient way using HMRC’s salary exchange scheme reducing NI contributions, whilst rolling out pension optimisation tools.
Founded by the founder of Perkbox, and with the team ex RBC, BDO and Atomico, Mintago is growing at 100% MoM and saved customers over £250k despite only launching in December 2021.
KiKapay enables merchants to collect payments from customers in a manner that is typically 80% cheaper than card payments, by using their bank’s secure customer authentication process, and because it doesn’t require an app to be downloaded, KiKapay provides a frictionless solution.
With open banking payments increasing ten fold in 2020 and 25 billion card transactions having been processed in the UK alone. KiKapay has brought onboard an experienced team with 75 years experience, including a partner at Deloitte and the ex Head of Advisory for European payments at EY.
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
Up next, Ziglu, a digital platform bridging the gap between cash and crypto; Yang Li, Chief Growth Office, shares his story behind the company’s £6.1 million seed round:
Tell us about Ziglu and how you came up with the idea
Ziglu was born out of the realisation that both traditional and challenger banks were preventing their customers from having access to cryptocurrencies. With the rise of cryptocurrencies we could be seeing the biggest ever transfer of funds into a new asset class, and decentralised finance (DeFi) is providing unprecedented opportunities to grow wealth.
Yet the majority of consumers are unaware of the opportunities of cryptocurrencies and DeFi, or are confused by them, or have no affordable way to participate in them. To solve this problem, Ziglu has been designed and built to combine modern challenger banking features for everyday spending with safe, simple, affordable and insured access to cryptocurrencies.
Why did you decide to raise investment?
We saw some remarkable early customer engagement and wanted to accelerate our customer acquisition, particularly to coincide with the amazing bull run we’ve been seeing in the crypto market. Giving ownership to customers also gives them a chance to benefit in our growth and success too and that’s at the heart of what we stand for.
Furthermore, our product and tech team had built an innovative but aggressive roadmap of features that they wanted to deliver. Fundraising has meant we can now deliver new features and improve customer experiences pretty much as fast as we can think of them.
What is your top tip for anyone raising investment for the first time?
Don’t overly focus on how your product compares to competitors. Be clear about how your product truly delights customers. No startup has failed due to competition alone.
What attracted investors to your company?
Ziglu has an experienced team with a proven track record of building amazing startups like Starling, Monzo, Wirex, Meituan, and a product that provides a significantly better crypto-investing experience for beginners and aficionados alike. This combination of a proven track record and a visionary product and proposition has proven to be very attractive to investors.
My biggest fundraising mistake was…
Worrying too much about the aesthetics of the pitch deck.
Why did you choose to use Angel Investment Network?
Angel Investment Network stood out to us because of its superb track record of assisting innovative startups to find strategic investors: investors that provide us with first hand advice about disrupting huge industries, broaden our network of partners and add significant value beyond cash.
What has the funding enabled?
The funding has allowed us to significantly ramp up our marketing, build new features faster and accelerate our plans for international expansion. The team is currently very focused on Ziglu’s international expansion, with our first overseas launch slated for the second half of 2021.
Keen to hear more?
If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising fundraising yourself, you can find your local network here.
You’ve Got This is a talent marketplace for startups. We bring together experienced professional talent with the UK’s fast growing startup ecosystem.
We’re making it quick and simple for hiring teams to find mission aligned team members with the sales, finance, product and sector knowledge they need now.
We enable you to get to know each other on a project basis and hire on an employment basis when the time is right.
Why did you set up this company?
Covid has accelerated job losses but it’s also given us the opportunity to weigh up our priorities and how we allocate our resources. Many of us want to be more efficient with our time and to work on things that connect with our values and sense of purpose.
At the same time more mission driven businesses are being created. Innovative startups and SMEs are looking for ways to bring on flexible diverse talent, and that is harder to find through traditional channels.
They look for highly skilled individuals that can get them through the early years and establish shared values and trust before they hire long term employees. That’s where we come in. I felt there was an opportunity to use technology to help us find meaningful flexible work with businesses and become their early team members if there’s a fit.
How did you get your first customer?
Our first customer came through our co-working space. They’re a startup in the renewables space. They had tried platforms like Upwork but couldn’t find what they needed; someone with specific qualifications, who could work part-time, come into the office a couple of days a week and become their first hire down the line.
We knew we were onto something when?
We had a first degree connection with the first 50 professionals that signed up to the platform. After that we started to get referrals from individuals who we’d matched for conversations with businesses.
Similarly one of our businesses who we matched with a part-time Finance Director came and asked if we could connect them with a Sales and Marketing expert.
Together with my CTO Stephen, we’ve built a platform based on customer insight and a roadmap that positions us well alongside platforms such as Upwork and People Per Hour.
We’re now producing content for our user base on joining and building high performance teams. Our content has been reshared by NatWest business builder and venture capital funds.
Our business model:
We’ve looked to modernise the traditional recruitment model of upfront commission on annual salaries. Many of our startups find this prohibitive in the early stages. It’s free to search and start connecting with available professionals.
We apply a service charge on the value of bookings made through the platform. We also provide the process for getting timesheets approved and payments made once work is complete. You can read more about our pricing on our website here.
Based upon our conversations with our business users, we’re planning to launch a pay monthly service with a discounted service fee and extra features for our regular users.
We think that there’s growth in this sector because:
The gig economy is growing rapidly, with 50% of the workforce are expected to be full-time or part-time self-employed by 2025.
Automation is replacing the jobs of people who have worked in one sector for many years, pushing people to make a career change later in life.
There are 1.3 million SMEs in the UK (1-49 staff), currently spending an average of £6,000 per year on recruitment. This market is worth £7.9 billion. We’re looking at entering new markets in the future.
We caught up with Riaz Moola, CEO and CoFounder at HyperionDev. HyperionDev are aiming to close the global tech skills gap by enabling education as an accessible alternative to more traditional university degrees. Doing this through specialised mentored coding bootcamps, offered online and on-site at its Johannesburg and Cape Town campuses.
What does your company do?
At HyperionDev we teach people to code. Not give lessons. Teach. Intense, immersive courses that get completed in 3 – 12 months (course dependent) with a unique human led mentorship that is built upon our unique codebase. A meld of automation and human touch that scales and works.
At our core, HyperionDev teaches people the essential skills they need to find fulfilling, rewarding careers in tech. However, we do way more than just teach: over the course of 3 to 12 months, we immerse our students in a high-pace dedicated coding environment that takes them from total beginner to a job-ready industry professional.
Our meld of automation and human mentoring gives us the power to give each student in-depth and personal attention, but in a way that we can scale to students in over 40 countries.
Why did you set up this company?
We didn’t go looking for a problem to solve, we found a problem that really needed solving. At university in Africa, a group of friends and myself were shocked at the extremely high dropout rates that affected not just our classes, but classes across the country.
We decided to do something about it: we started a mentorship program to help students to master the fundamentals of coding. We added mentor after mentor, until our network spanned dozens of universities across two continents.
Later on, I realised the difficulties people faced with learning the skills that could get them rewarding, fulfilling careers – and so HyperionDev expanded to teaching people even outside of university..
How did you get your first customer?
A government-run research group that carries out AI research actually approached us, saying that we were the largest trainer of the Python programming language in their region, and asked us to train for them.
We initially thought we’d have to raise money to do the training, and were surprised when they offered to pay us. In the end we charged 10 times less than we should have for the service!
We knew we were onto something when?
We just didn’t have people stop signing up for our courses every day, and didn’t have a month where we didn’t make revenue from our online courses. At the start you think it a temporary, short-term demand, but when you see the continual interest, it feels like you’ve unlocked something completely new.
Our business model:
There are essentially two, B2C online immersive courses that are cost effective, and accessible from anywhere in the world that we built to scale. The courses, while cost-effective for students, are profitable to us as we grow. We reached profitability in Q1 2020.
Our Code Review base is a B2B SAAS product under the CoGrammar brand, used by tech companies and even other leading software schools internationally
Our most effective marketing channel has been:
Our alumni network – we still see word of mouth driving a huge number of new students. The network effects from this group has been critical to our growth.
What we look for when recruiting:
A-players. People who can work in an intense environment and are driven by our mission to create people who can take up the vacuum in the global tech skills gap.
The biggest mistake that I’ve made is:
Not realising that we could build a really good profitable business , as well as create awesome social impact, sooner. You don’t need to be a non-profit to truly help people.
We think that there’s growth in this sector because:
Nature abhors a vacuum! Every startup is facing the same problem, where to get talent. The group of startups is growing, the talent pool isn’t keeping up. Know what that is? We call it opportunity. And with that opportunity we solve real global socio-economic problems and make a difference in people’s lives. It is one of the best problems worth solving that we know about.
We worked with AIN because:
Networking is perhaps the most important part of any future-facing business or campaign. It’s what got us started as a grassroots organisation of coding mentors, and it’s what grew us into the continental tech education leader we are today.
You can only get closer to the success you envision if you surround yourself with the right people, with the same vision and goals: and the AIN networks are one of those alignments.
How are you coping with lockdown? What is your strategy?
We have moved to a remote first way of working, from a previous policy of a remote friendly. And the positive response had been fantastic. Execution and productivity are actually up.
Is there anything your business is doing to help in your community or with the wider crisis?
South Africa’s biggest problem is unemployment. The numbers are staggering. We are actively supporting communities directly with scholarships, education and the resultant access to the global shortage of coders in the market. The knock on effect is heartwarming to say the least.
Keen to hear more?
If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.
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
In our latest Behind The Raise we caught up with Nick Begley, founder of Psychological Technologies (PSYT) on disrupting the self-help market, peoples’ willingness to invest in their wellbeing and the time and attention needed to execute a successful fundraise.
Tell us about PSYT?
We all want to improve and we usually turn to books, audiobooks and videos. But how much do they actually help us change?
If we’re honest, not much. That’s because passively digesting information isn’t enough. Reading about how to ride a bike isn’t going to magically allow you to ride a bike, and the same is just as true when it comes to self development. It needs to be put into practice.
So that’s what we do – take proven content, with proven demand, and deliver it in a more effective format, helping people put advice into practice, to create real change. Like Masterclass, we work with authors to leverage their established brands and fanbases.
Why did you decide to raise investment?
To build on the success of our MVP. Our MVP was based on one book and the funding will allow us to build a multi-book platform which will have multiple courses in one place.
What is your top tip for anyone raising investment for the first time?
It takes a great deal of time and attention, so start early. Make sure you have enough runway and try not to be involved in any other big projects at the same time. The process is time consuming, not just the pitching, but the follow up emails and calls as well.
What attracted investors to your company?
I think there were 3 things; the previous experience of the team, the results of the MVP and market timing. I was previously the Head of Research at Headspace, and my cofounder ran the world’s largest research study into day to day happiness out of the LSE.
Our MVP product, The Anxiety Solution gave great proof points, through user reviews, metrics and Apple App Store endorsement and we had signed a number of fantastic NYT bestselling authors.
The popularisation of meditation, mental health destigmatisation, and the willingness of millenials and Gen Z to invest in their wellbeing, has led to the market exploding in recent years, giving rise to many 9 and 10 figure company valuations in the space. Although the market is growing rapidly there is still a big gap between learning what to do and actually applying the advice to your life, which is the gap we fill.
My biggest fundraising mistake was…
Trying to run the company at the same time as fundraise. It’s a huge job for one person and takes all your time, don’t think you can be as productive on other things at the same time.
Why did you choose to use Angel Investment Network?
AIN was recommended by a friend and they have a huge network. Ed was helpful, proactive and professional and their terms are reasonable.
In our latest edition of #BehindTheRaise, we caught up with LifeSaver Co-Founder, Archie Wilkinson, about setting up a B-Corp, the importance of a great team and why getting your documents in order is so important.
Tell us about Lifesaver:
We sell & return power banks to charge your phone. With more smartphones than toilets in the world, we are focused on providing power on the go in a sustainable way.
The power bank market is estimated to be worth $27bn by 2024 and we want to change this industry to be cleaner, circular & greener. We are the 199th certified UK B-corp, with a hire & return model across events and venues reducing battery waste as we recharge and reuse.
We fill all our power banks with renewable energy saving 13 grams of CO2 per charge & recycle our batteries to areas with no electricity by making off-grid solar lights with Liter of Light.
Why did you decide to raise investment?
To scale.
We had proven a number of unknowns and required investment to accelerate our growth. We are an ambitious company with big goals to change an industry to be more sustainable, raising investment helps us to develop our product, hire the best people thus driving further sales.
What is your top tip for anyone raising investment for the first time?
Keep at it. Listen & adapt as you go. You will have multiple pitch decks and always try to get feedback from investors that say no, and evolve. It is also important to have good documents (i.e. articles of association, shareholders agreement, term sheet etc.) SeedLegals is a brilliant and cost effective platform to streamline super slick documents and integrate your cap table. They also offer completely free support & advice on top of this.
What attracted investors to your company?
Team, vision and a real problem that needs solving in a better way. Ultimately they are buying into the team & vision of the future. They say investors will invest in a great team with an ok idea over a great idea with an ok team, it is important to have people around you that make you feel like the weakest link! If you don’t have people you are learning from then you don’t have the best team. Don’t rest until you do.
My biggest fundraising mistake was…
Possibly not having watertight company documents to start with, this delayed investment. SeedLegals helped us out on this and now we have very good documents with articles that align to our B-Corp status.
Why did you choose to use Angel Investment Network?
Angel Investment Network is a great way to reach multiple angels in an automated and simple way to engage and inform investors. The network will open you to more investors and thus help in improving your business.
Keen to hear more?
If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.
Julian Seydoux is a rare breed in Europe, an entrepreneur who has set up a company, scaled it, exited it, and is now investing and advising the next generation of start ups. As Julian has experience of Angel Investment Network, both raising funds and investing, we decided to pick his brains.
What impresses about his story is the belief that having completed his market research with intense focus and determination, he could take on the ultra competitive Chinese market, launching Vai Milno, a chain of gelato stores, and enter an industry that he had no prior experience of.
He explained how he arrived in China with ‘two bags and nothing else’. That sense of determination clicked with investors, but also tying in the traction and a word that keeps coming back in our conversation ‘momentum’.
‘We explained the story of all the achievements we had made until then, which in hindsight was extraordinary fast. We signed several partnership agreement, persuaded the chef to join us from Italy. So investors when they saw this, could see that something was moving fast, something was happening.’
Switching to being an entrepreneur, seemed a natural next step for Julian after his job in M&A, working in emerging markets, he learned where there were exciting opportunities. In the city he had honed the skills necessary to evaluate quickly whether there was a business opportunity.
Julian was finishing a part time degree at London Business School ‘One of my classmates approached me and said why don’t we set up a company? I think China would be a great place to start a business. And I thought if I’m working 18 hours a day, I might as well do it for myself!’
As Julian’s gelato business gained traction in the Chinese market, opportunities to exit began to appear. ‘‘I had a prior opportunity to exit, but we didn’t take it, I thought this is working, let’s just continue what we’re doing and focus. But at some stage life happens. You just need to decide whether to move on.’
Julian then thinks logically about how you determine when is the right time for a founder to move to on from his business. Splitting entrepreneurs between those who have the skills and desires to start a business, and those suited to growing it.
‘For the founders you need to decide what kind of founder you are – are you more interested in the startup craze at the beginning, or are you a later stage managerial founder who can get the processes right?’
In fact Julian has seen later stage VCs frequently appoint new CEOs, bringing new people to the board and key hires into the company, ensuring that they have the right skillset to grow the company. In Julian ’s words: ‘At one stage you have to think could someone else do better. One of the challenges for founders is acknowledging there’s a limitation of what they can do.
And all these considerations came to mind when I decided it was right for me to leave the company and exit.’
In terms of getting your company so that it’s in a position to exit, researching who are the potential buyers early on pays dividends . ‘Something that I was keen to do early on was two way partnerships with people who could potentially be acquirers.’
How do you ensure that you get the deal you want? ‘Just remember – at the end of the day, don’t be afraid to negotiate, everything is negotiable!’
Julian is sanguine about his success on selling his business, he describes the emotions he endured as ‘part of me sadness and part of me relief I had gone through the process, and other parts of me were thinking about what to do next. I have seen some very sad people who have exited with plenty of cash, they are just struggling afterwards’.
Now an Investor, Julian is often shocked by how bullish founders are before remembering that he too was like that. He feels that he can quickly get a sense of if there is a fit – he looks at spaces where there are potential and where his skills can add value, and when talking to founders quickly gets a sense as to whether the team can execute.
His parting advice for founders ‘if someone offers you money, take it!’ he says, before laughing.
Keen to hear more?
If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.
Saima Duhare is the founder of Halal Fresh, the UK’s first halal non subscription meal kit service predominantly catering for the Muslim community.
What does your company do?
Halal Fresh is a meal kit service providing freshly preportioned ingredients, with an easy to follow recipe card to cook great tasting meals. Making dinner times stress free and enabling our customers to be adventurous in the kitchen, as well as supporting their healthy lifestyles.
Why did you set up this company?
My vision was to bring back the joy of cooking by offering every Muslim household the opportunity to cook homemade fresh meals from around the world, making dinner tables exciting to sit at.
I grew up in a household where food was the catalyst of bringing people together, my Grandma, Mum and Aunty are amazing cooks and would cook foods from around the world and we would always have family and friends over. I felt we were losing the importance of having a home cooked meal which gives an opportunity to spend quality time with family and friends over a great meal.
Given the rise of fast food and the ease of it, coupled with the busy lives we lead, I felt this aspect of our life was slowly disintegrating. So Halal Fresh was born to make people’s life easier and offer varied, healthy delicious meals they cook from scratch at home, in addition to being mindful of our carbon footprint since everything is proportioned so there is no food waste and all of our packaging is recyclable
How did you get your first customer?
We had no budget for marketing and when we launched we pretty much prayed we get customers, lucky for us people were googling for a halal meal kit service, thus, my first customer was a Dr who kindly posted our service on Instagram, result of that we approached various influencers from different professions, and and from that we organically built and grew ourselves this is going back in April 2019 and still we haven’t spent any money on marketing apart from a offering a recipe box in exchange for a shout out, plus our lovely customers a promote us
We knew we were onto something when?
We were approached by a journalist from the Independent and at the time we had no clue which publication she was from until I delivered the box and we were included as being one of the best recipe boxes in July 2020.
Our business model:
We are an online non subscription business model, which people enjoy because they can use the service without feeling tied in, and that works for us and them.
We’re currently only serving the London region, however, we are looking to expand nationally. We are growing slowly but surely and organically. And the interest we receive daily in bringing it to other parts of the UK is promising and exciting. We are learning as we develop, progressing and improving our offering and service.
Our most effective marketing channel has been:
Instagram and word of mouth from our customers and being in several reputable british and British Asian papers has helped us and put us on the map as a 5* Halal Recipe Box.
What we look for when recruiting:
We are a very small team, and the team we have are very passionate about food and the industry. We look for people who are creative and open to learn as much as we are, and contribute to what we are trying to achieve, to make people’s lives easier, and can work on their own initiative.
My graphic designer for instance has had very little experience but her work excited me. I tend to go with my gut feeling, of course they need to have the skill but not necessarily the experience.
The biggest mistake that I’ve made is:
Having no experience in opening a business I have made lots of mistakes, but one of them for instance, when we had our soft launch I spent £6,000 to test the model on 40 people, in hindsight I could have tested the model on 20 people and tested it for much less.
I created the MVP as if though it were a fledgling business, with 9 recipes, 2 chefs, all the packaging and pre portioned ingredients from suppliers, which I could have easily pre portioned myself and less recipes and 1 chef.
We think that there’s growth in this sector because:
The halal sector is booming – in 2019 it was valued at £31bn, considering there are only 4.1 million Muslims in the UK, that staggering. It’s very exciting times for the food industry despite the current climate. We are becoming more mindful about what we put into our bodies and becoming conscious consumers.
Is there anything your business is doing to help in your community or with the wider crisis?
We are heavily involved with our local food bank which was set up by a friend of mine, and have volunteered, distributed food as well donated food. This is something we are also passionate about, which is giving back and helping those that are vulnerable in our community, so much so we are working on embedding this into our business model.
Keen to hear more?
If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.
Angel Investment Network (AIN) has revealed its latest ‘State of the Angel Investment Nation’ findings. It is based on the data of more than 125,000 UK registered businesses looking for funding and 35,000 UK investors over the course of 2020.
Technology remained the top category of interest for angel investors looking to back businesses in 2020. Meanwhile, finance closed the gap, climbing five places to become the second most popular category for searches. In the year of the pandemic, medical & science climbed two places with a surge in investors backing entrepreneurs focused on improving health outcomes. We also witnessed a huge growth in interest in agriculture which saw a rise of 63% in searches and climbed seven places to become the eighth most searched term.
For entrepreneurs, property is the most popular sector for pitch ideas. Entertainment and leisure is the second, followed by fashion and beauty. This highlights something of a mismatch between the sectors in need of funding and the sectors investors are interested in backing.
AIN has also revealed the UK’s top entrepreneurial hot spots. London’s share of all pitch ideas has fallen slightly, although it remains responsible for 36% of all pitch ideas. The South East is second in the list with the North West number three. Growth in both Wales and Scotland outperformed the rest of the UK seeing a rise in the number of pitches as the startup culture continues to flourish across the UK.
According to AIN co-founder Mike Lebus: “It has been an extraordinary year with so many lives and businesses impacted by the virus. However in the face of unprecedented challenges, we have witnessed the resilience and adaptability of UK startups working to bring solutions to the problems of our time. From innovations in finance, technology bringing people together during social distancing to the wonders of medicine and science. It’s no surprise these are the businesses gaining interest and investment from our investors.”
“We are also seeing the nascent development of ag-tech and brilliant technological solutions tackling the very real challenges we face of feeding the population and maximising efficiencies and yields. The challenges of climate change are undimmed and this is a sector that is at the forefront of that battle.”
He continued: “While London has been dominant in the past we are now seeing the comparative growth of other nations and regions in the UK as our embedded startup culture takes further root. We can look forward to a continuing resurgence across the country as we emerge from this difficult period.”
1. Technology 2. Finance 3. Software 4. Medical & Sciences 5. Property 6. Food & Beverage 7. Energy & Natural Resources 8. Agriculture 9. Entertainment & Leisure 10. Retail
The entrepreneur hotspot list is as follows (based on number of pitches from each region):
1. London 2. South East 3. North West 4. South West 5. West Midlands 6. East Midlands 7. Scotland 8. East Anglia 9. Yorkshire and Humber 10. Wales 11. North East 12. Northern Ireland
To connect with angel investors looking to back your business visit https://www.angelinvestmentnetwork.co.uk/
We first met Rav Roberts, CEO of Pharma Sentinel, at one of the virtual events that we hosted. He recently successfully closed his investment round, and we are pleased to hear the learnings he has to share:
Tell us about Pharma Sentinel:
Pharmasentinel.com is a UK Consumer & Business healthtech helping each person to lead a safer life, by leveraging AI to provide trusted, timely & personalised medicines and medical conditions news, alerts and medicines data intelligence.
PharmaSentinel launched its consumer app ‘medsii’ (Medicines information for Me) in October 2020 on the App Store & Playstore and already has over 15,000 app downloads in 150 countries.
Medsii provides information on side effects, drug safety alerts & recalls, and clinical trial opportunities for participation, in an engaging, patient-centric Twitter-style interface.
Why did you decide to raise investment?
2reasons:
1) To accelerate our launch into the USA, our key market.
2) To accelerate the launch of our Business SaaS data product.
What is your top tip for anyone raising investment for the first time?
Persist.
It took us months of pitching to get our first investor, then bit by bit, the floodgates opened.
Secondly, use Twitter to link with very experienced USA VCs, e.g. Brad Feld, Jason Calacanis, Elizabeth Yin, who will give you tons of *free* advice AND *free* training on pitching, negotiating with VCs etc.).
What attracted investors to your company?
1) Very experienced founding team (we all met in Business School 16 years ago).
2) Healthtech very topical, even before Covid-19, with more people living longer & taking personal responsibility to manage their health to live quality lifestyles.
3) Great business model, with globally scalable consumer & business products.
My biggest fundraising mistake was…
Initially not being succinct during pitches. (Second mistake was not using an ethernet cable to pitch).
Why did you choose to use Angel Investment Network?
I got a couple of tips from friends, then tried it and, (to my surprise), angel investors started to contact me and actually invest!
AIN’s Head of Impact and CEO of SeedTribe, Olivia Sibony peers into her crystal ball for 2021 to see what it has in store for the impact investment space.
With the huge focus on the pandemic over the past year – many might have thought impact investing was on the back burner. Luckily this didn’t prove to be the case. In the teeth of the first lockdown on the Angel Investment Network platform we saw renewables become the 11th most popular keyword for searches, a rise of 34 places compared to 2018. We also saw terms like Greentech rocket up the rankings for investors looking to invest. So looking ahead, what can we expect? Here are three predictions.
A rise in interest in impact-focused startups
In 2021 we can expect more investors to back impact-focused startups. We have witnessed a new regime take office in the White House rejoining the Paris climate agreement, committed to net zero emissions. Part of a rapidly growing movement worldwide. More consumers are voting with their wallets in demanding brands’ values are in line with their own. Additionally more investors are wanting to see the ethical credentials of businesses they are considering backing. This is particularly the case with passion-driven angels. This virtuous circle means we will in turn help to inspire a new generation of entrepreneurs focused on the solutions to mankinds’ most pressing problems. We are also seeing the huge financial rewards for companies focused on ESG goals. Elon Musk becoming the richest man in the world was a watershed moment in this regard. It can be extremely profitable to embed purpose into your business model.
The establishment of more metrics for the measurement of ESG
Impact-driven investors are looking for more established measurement of environmental and social performance to give them more understanding of where and why to invest. We saw a real landmark moment at the end of the year with the big four accounting firms agreeing a reporting framework last year for ESG standards. We will see this more widely used and taken up in 2021. At SeedTribe we use the UN Sustainability Goals (SDGs) as the basis for our framework for the companies we back and for how entrepreneurs can benchmark their progress. The SDGs are the closest we have to a standard for ESG ratings. The 17 SDGs and their 169 associated targets are by no means perfect, but they are the best blueprint available to achieve a more sustainable future. They have been agreed by all countries.
What I am seeing on the ground is more demand for startups considering the full impact or end to end life cycle of a product or service. For example it is not enough to merely produce solar panels if they are not produced in a way that is in itself carbon-efficient or end up unrecyclable. Better still of course, is seeing start-ups embrace a truly Circular Economy. We need to ideally create close-loop cycles without any waste at all. A start up like Aeropowder is a great example of that. They have created the world’s first sustainable thermal packaging made from feathers – Pluumo. The poultry industry is drowning in feathers (3.1m tonnes per year in the EU alone) and has limited disposal options. Powered by feathers, Pluumo can keep food deliveries chilled while replacing expanded polystyrene. They are gaining huge interest from investors.
Increasing cross-border collaboration
One silver lining from covid is the increasing level of cross-border collaboration using technology tools. In 2021 with most travel on hold for the foreseeable future, we are likely to see the further rolling out of systems enabling start ups to collaborate and share best practice and insights. For example, WeFarm is the world’s largest farmer-to-farmer digital network. They enable farmers worldwide to SMS any farm related question to a network of other farmers who can help, enabling farmers in Colombia to learn from farmers in the Congo. These sorts of initiatives can improve efficiency, best practice and help reduce CO2 emissions. This is being led by startups but will trickle up to larger firms with enormous data pools being harnessed to create actionable insights to reduce CO2 emissions.
As we look to the future we can be confident in the vision of startup entrepreneurs and enlightened investors to help drive the change we want to see in the world in 2021.
We caught up with Wayne Edward Clarke, Founder of Fast Water Dispensers, who explains how he is revolutionising water dispensers in the Philippines.
What does your company do?
We manufacture a revolutionary new kind of water dispenser for refillable blue 5 gallon water bottles.
Fast Water Dispensers Product Demo
Why did you set up this company?
I come from Calgary, Canada, where the tap water is top quality drinking water. When I moved to the Philippines I wasn’t used to using refillable water bottles for drinking water, as everyone does here. The long amount of time it took to draw a coffeepot full of water from a standard water dispenser to make coffee every morning became more frustrating until it was intolerable.
I searched the stores and online retailers for a faster water dispenser, and found that there were none available.
It took a few days of research, design, and fabrication to produce the item that I now consider to be my proof-of-concept prototype, and I used it successfully for months. I realized that there must be millions of other people who are as frustrated with their water dispensers as I had been, and I recognized that this was an opportunity that was too good to let slip away.
The key to our success will be:
-A product design that’s a disruptive improvement over all the existing competitors -A tough, quality, environmentally friendly product that should last a lifetime for a price that’s competitive with cheap plastic Chinese dispensers -The very low cost of labor in the Philippines -0% taxes for 6 years and zero import/export fees in the Philippines Special Economic Zones -Utilizing the training techniques of elite athletic teams to achieve world-class employee performance -A manufacturing process that achieves an unbeatable investment-to-production ratio by utilizing very ingenious jigs and simple machines but no complex or expensive machines.
Our most effective marketing channel will be:
-Online retail sites such as Amazon, Lazada, Alibaba Express, etc.
What we look for when recruiting:
Bright, adaptable, fast learners. This applies to our office workers and to our factory workers, who will also need good hand and tool skills. At the pace we’ll be working we’ll need to rotate the assembly line teams from station to station fairly often to avoid repetitive motion injuries and employee burnout and to keep morale high, so they’ll each have to learn every task in the factory.
Once we reach sales of about 2 million FastWater Dispensers per year in it will be worth transitioning to a completely automated robotic assembly line. We’ll then use our highly trained and integrated manual manufacturing teams to build and operate the assembly line for our next ingenious product design, of which I have many, and the entire cycle should repeat about every three years.
The biggest mistake that I’ve made is:
Not researching Alibaba and the Chinese suppliers represented there sufficiently before researching my costs for equipment and materials. I’d prefer to buy from local Philippines suppliers, but there’s only a few of them and they’re hard to find and communicate with compared to the crowds of companies on Alibaba. The Chinese companies can be challenging to communicate with because of language and cultural issues, and I wish I’d learned more about that before I started. Having dealt with many of them to cost out my business plans, it’ll be a lot easier when I start purchasing.
We worked with AIN because:
AIN seemed like the method of raising financing that was most likely to get results. There seems to be a lot of fundraising services that specialize in online and high-tech businesses, and a few who cater to emerging market businesses like the guy who wants to upgrade his small pineapple farm, while AIN represents a much broader spectrum of what I think of as ‘normal businesses’, like mine.
How has coronavirus impacted your business and your fundraising plans?
-In-person networking has gone from being the most important part of any fundraising strategy to being almost impossible. I’m not sure if we’ll be able to reach our fundraising goals without it, but we’re giving it our best shot!
How are you coping with lockdown, and what is your strategy for it? I’m doing pretty well, thanks. I already worked online from home, so my life hasn’t changed much. It would be very hard if I were single, but luckily I have a fulfilling relationship so we can keep each other company. I’m an n95maskand face shield guy, I take every precaution, because I’m 57 so I’m in a moderately high-risk group, and I’m not taking any chances.
Keen to hear more?
If you would like to see what other companies are up to on Angel Investment Network, or are interested in raising funding yourself, you can find your local network here.
The founders of ecommerce startup aisle 3 have bounced back after being made redundant at the start of the pandemic to successfully raise £200,000 for their new ecommerce venture, supported by Angel Investment Network.
aisle 3 is a new marketplace providing choice and control for shoppers across the globe, who are able to select from 600 retailers on the platform. By deploying Machine Learning and AI algorithms, they aggregate retailer offers and rich product information so shoppers are presented with all of their buying options on a single screen. It took the business three months to raise the funds after two thirds of the founding team were made redundant at the start of the first lockdown and created the new business.
Founded in March, aisle 3 gives shoppers the complete view of all of their buying options so that they can make purchase decisions based on their personal values such as price, delivery, locality, sustainability or brand loyalty. The team has developed their proprietary web crawler, feed processor, laravel site, serverless infrastructure and multiple product aggregation algorithms from scratch. The funds at this stage are primarily directed towards advancing the brand’s product and tech build.
The founding team of Thomas J. Vosper, James Valbuena and Justin Thomas have 30+ years of collective ecommerce experience at some of the biggest names including– Amazon, Tesco, Lastminute, VASHI. In a short space of time they have grown to serve 2,000 organic shoppers each day, 600 signed retailers, and 20 Digital Agencies with more than a million products and 3 launch categories – Trainers, Toys and Baby products rolling out over the next few weeks.
According to co-founder Thomas J. Vosper: “We’re obsessed with shoppers getting their best deal – whatever that means to them. We’ll achieve this by solving two fundamental issues in online shopping. Firstly, we want to give shoppers the complete view of all of their buying options so that they can make purchase decisions based on their values. Secondly, we’ll make it easier for shoppers to find new products whilst, in parallel, leveraging our two-sided marketplace to act as a conversion enabler to close the gap between shoppers and retailers with significant revenue upside and ability to scale.”
He continued: “Like so many others, I faced adversity in the pandemic. However being made redundant gave me the chance to realise my ambition to create my own business taking the learnings from 14 years in online retail and support of an incredible network of industry advisors and investors to create something better. We are delighted that investors on the Angel Investment Network platform bought into our vision and I hope our success will inspire others to think there is light at the end of the tunnel during tough times.”
We are delighted to welcome back Adam Blair, CCO at SeedLegals, for his second guest blog as part of our legal mini-series for start ups:
When funding goes Agile
In our first article we discussed some of the different fundraising methods available to you as a founder, and the impact and benefits of the SEIS / EIS schemes. See How to close your funding round before the end of 2020 if you missed it or need a reminder…
This month we delve deeper into the world of agile fundraising and share some practical advice that can help you raise money for your business before the end of the year.
Making the most of the Christmas rush…
The run up to Christmas is always one of the busiest times of the year in terms of fundraising activity and investment. This can be a great time to look for investment, as many investors are looking to move quickly and close investments before heading off on their well earned break (even if this year that will be at home…).
With less than four weeks until Christmas, there’s not long left if you’re looking to raise investment this year. But all is not lost – agile fundraising enables you to raise investment quickly and flexibly in situations just like this.
What is agile fundraising?
Over the last couple of years at SeedLegals, we’ve observed that many early stage companies are moving away from go-big-or-go-bust funding rounds every 12 to 18 months in favour of agile fundraising where they raise small amounts frequently, taking investment opportunistically (e.g. when you meet someone who wants to invest) and as needed.
We now see the savviest founders use agile fundraising to grow their businesses faster, spend less time holding up the business while they look for investment, and give away less equity than founders relying solely on the traditional go-big-or-go-bust funding rounds.
The two main agile fundraising methods are SeedFAST (Advanced Subscription Agreement) and Instant Investment.
Advanced Subscription Agreement (ASA)
An Advanced Subscription Agreement is the UK equivalent of the SAFE (commonly used in the US) and is SEIS/EIS compatible – great news for you and investors.
An ASA allows investors to give you money now, in exchange for shares in your next funding round. Your ASA investors will receive their shares, generally at a discount compared to other investors in the round, because they invested early, when you close your next funding round.
Instant Investment
Instant Investment allows founders to close an initial funding round like normal, and then top that up anytime, within limits agreed in the initial funding round.
This enables you to raise only what you need or are able to raise right now, and get back to growing your business. Then, as you find additional investors, you can quickly and easily add them, effectively topping up your last round. At SeedLegals, we regularly see founders close a funding round and continue raising using Instant Investment for 12-18 months before doing their next round.
You can read our comprehensive agile fundraising guide here
Is agile fundraising right for me?
There are a number of scenarios where you can use agile fundraising to your advantage, whether you are going out to investors for the first time or have raised multiple rounds of funding already.
Here are a few of the most common use cases we see at SeedLegals:
You’ve found your first investor…
First investor on board – now to find the rest, right? Yes and no…
While one option is to keep your round open as you search for other investors, a better way could be to use ASA to get that money in ASAP, rather than keeping those investors (and their investments!) on hold while you line up all the other investors for your round.
With an ASA you get investment there and then, which can be used to invest in growth or extend your runway, and the investor generally receives a discount on the upcoming round in return.
The fact that one investor has already committed and transferred funds will also typically be viewed positively by other investors you’re speaking to.
You can’t agree on / don’t want to commit to a valuation…
Is my valuation £500k? £1m? £3m? £5m? Agreeing a valuation for an early stage business can be a minefield. Luckily, we’ve written this article about how to think about valuing your startup…
Great! So you’re good to go… But there are still lots of cases where investors and founders simply can’t agree on a valuation or may strategically not want to agree a valuation at that time.
An ASA can help both parties here, giving you up to 6 months to finalise the valuation. As a founder, this not only gives you much needed cash, but also time to grow the valuation to a point where you and your investors are both happy.
You’ve got your key investor(s) on board…
When fundraising, founders will often have certain investors they really want to get on board. Perhaps they’re writing the biggest cheque, have a great network, or are able to provide unique advice and insights.
You’ve landed your dream investor(s) and have a decent chunk of your target raise committed – now what?
This is a great time to consider closing your round and continuing to raise using Instant Investment. Negotiations around valuation and key terms are likely to be finalised or close to finalised by now, meaning that other investors are likely to be signing up to the same terms.
This approach means you receive funds and can put them to work immediately, whilst continuing to fill and complete your round.
You’re just waiting on the last investor(s) to sign…
Everybody has signed, except one or two investors… One is going on holiday for two weeks and the other is dragging their feet. What do you do?
You could wait until they get back, but this just means more time thinking about fundraising vs. growing your business. Instead, you can let these investors know that you’re going to close the round without them, but (and very importantly) they will be able to invest at the same terms once they’re back, or ready to commit.
This approach can sometimes lead to investors suddenly being available to sign and transfer funds, meaning the round closes as initially planned. Either way the round closes sooner, without losing investors, a win/win.
Summary
If fundraising is dragging on, or you just want to move faster, agile fundraising could be just what you have been waiting for…
SeedLegals
Questions about agile fundraising, or fundraising in general? You can book a call with one of the SeedLegals experts, who will be happy to help.
We spoke to Occuity founder and CEO Dan Daly about his revolutionary new device diagnosing chronic health conditions via a patient’s eye, building a winning team and top tips in securing funding from angel investors.
Tell us about Occuity?
Currently, the diagnosis and monitoring of many chronic health conditions is inadequate, leading to people suffering when they don’t need to or even shortening their life expectancy.
Occuity’s mission is to improve this damaging situation through the development of cutting edge technology and production of a range of devices that will enable the non-invasive measurement of these conditions. Our devices simply shine light into the eye and detect changes and markers that indicate the person’s health. The first of the many devices in our development pipeline which will utilise our proprietary technology, is a hand held optical non-contacting pachymeter.
What is your background?
I have always been interested optics and lasers. I started out as a physicist, specialising in micro-optics (very, very small lenses) and measurements using light. It was fascinating how you could see down to the micron level with the right system. However, as I progressed, I moved away from doing the science and became more involved in the commercial side and actually applying these technologies to the real world. It was therefore an obvious next step to combine the two and form a company that utilised the powerful potential of optical measurements.
How did the idea for the device come about?
It started by thinking about what measurements you can do with light. Then a desire to make measurements that were worthwhile, and would make a difference. This led to the interest in healthcare. Building on this, I started to think about situations where people are required to make many, regular measurements. Diabetes is the obvious example. Clearly doing this in a way that is pain free and non-invasive would be a major advantage.
How did you recruit the team?
We have a great team with a huge amount of medical and engineering knowledge, experience and brain power. Having worked in this sector for a number of years, many of the team have worked together in the past. Most of our newer team members have come via personal contacts and recommendations, whilst some have even joined us after hearing about our plans through our website. We’re still growing and it’s exciting to see the team develop, but as our growth increases, it’s important we utilise the right channels to make sure we’re able to recruit the best talent, whether this is directly or through specialists agencies.
How have you overcome challenges during COVID? We were relatively fortunate that when COVID hit, we were a still a nimble start up and a lot of the engineering was still at the “developed in a garage” stage. This meant we were able to (literally) go back into the garage during lockdown and continue the development unabated.
We are also in the fortuitous position that as our measurements are non-contacting, they are much safer than the existing devices we are seeking to replace, as these devices must physically contact the patient or draw their blood. There is definitely a mood in the healthcare sector that the more you can do remotely, the better. The risk of spreading infections, causing accidental harm or pain is completely removed by our non-contacting devices, which is great news for both the patient and the clinician.
Why did you decide to raise investment? Due to the length of time it takes to run clinical trials and obtain regulatory approval, medical devices are very expensive to develop and of course you can’t sell them to generate revenues until you’ve successfully completed the regulatory process.
It was therefore necessary for us to raise funds and we will undertake further funding rounds before we get to market.
What are your top tips for anyone raising investment for the first time? Firstly, don’t push the valuation too high initially. Leave some headroom for future rounds so that those coming in later have a reason to invest.
Secondly, look for investors who bring more than just cash. It can be contacts, market experience or whatever, but once they are championing your company, it adds significant value.
What attracted investors to your company? It was definitely a combination of factors. A large part of the attraction is the upside potential of Occuity. We have a proprietary technology, protected by nine patents, and an expert team developing products which deliver clear solutions to large and growing markets. The opportunity is tremendous.
Take the glucose monitoring market as an example. This market alone is now worth over $14bn, and that is based on people sticking needles into themselves. It’s widely predicted that the first company with a non-invasive solution will take a large share of that very valuable market.
But the attraction is also the chance to be involved in something that’s doing good and significantly improving the quality of life for hundreds of millions of people.
My biggest fundraising mistake was… Timing. It always takes longer than you think to run a fundraising campaign and with COVID and lockdown layered on top, we should in hindsight have started earlier.
Why did you choose to use Angel Investment Network?
It is the breadth and experience of the network that adds so much value. Most networks are regional and so draw on a limited pool of angels. The AIN is global and as such we were able to raise funds internationally from people who offer distribution support in countries where we would otherwise have no links. In addition, the team are great to work with and we trusted that they could help us succeed, and they did.
Jenny Collins brings her passion & experience for bringing together smart, impactful R&D teams, across Google – to optimize the European start-up eco-system, and in particular connect Xoogler (“ex-Googler”) entrepreneurs with angel & capital investment.
This is the annual opportunity for ex-Googlers who have founded their own start-up to connect with investors.
This year, we have 170+ investors lined up and we are selecting 15 of the most credible start-ups from around three times that many applications. We’ll help each of them to create a succinct & delicious elevator pitch, of 2 slides in 2 mins & 2 Q&As, to attract further discussion in the social element of the day.
I’ll be simply there to present the talent: we have keynote speakers, all the major capital & angel investors signed up and we are sponsored by Landscape, which seeks to reward great behaviours in the investment world and Remo.co as our platform.
But it’s not just about funding; it’s about creating an entrepreneurial community, in this locked-down world. It’s a space to connect like-minded people & expertise; to absorb advice, be inspired, to show off, and to express frustration; to laugh.
Are there any common themes for the companies attending?
Companies must have at least one former Google Employee as a founder, be committed enough to the goal to be working on it full time, to have raised initial seed at least from friends & family, right up to series A and be rallying further funds. Companies will need to have an initial MVP to showcase and be able to demonstrate customer traction.
How does Google support Xoogler startups?
We have folks from inside & outside Google who help out; it’s entirely voluntarily – Xooglers tend to be self-reliant and like most things at Google, people help out because they are interested, not because they have to. We may look to syndicate further virtual demos to become more self reliant.
How would you describe the characteristics of a Xoogler?
It’s a terrific blend of folks who are smart & humble enough to get through Google’s interviews, schooled in how to create globally scalable tech, and a desire & determination to now do things themselves.
What type of investors are you expecting?
We have everything from Googlers who are starting to fund early stage ex-colleagues, about 50 seasoned angel investors, right up to companies like Atomico, Sequoia, Seedcamp, etc.
Have there been exciting successes from previous years?
It’s always fantastic when people you know do well, like Ex-Google Engineer Lewis Hemens, co-founder of dataform.co, who pitched in 2017, going on to complete Y Combinator & raise a seed round with a top European VC. The most recent exit is Irish based Pointy for $163m, and then (ironically) acquired by Google in Jan 2020.
How has Covid affected the demo day?
In response to Covid-19, XDD is now virtual, which has brought the future forward suddenly.
This makes it easier for more speculative investors to attend, but also means it’s even more requisite, because those coffee morning conversations and water cooler moments, in real life, are less frequent. Online community is increasingly important to promulgate this sector.
Are there any practical takeaways for our entrepreneurs?
Now is the time to get your startup sorted, to be ready to take UK/Europe out of lockdown Spring 2021. It will come quickly and there are plenty of gaps to fill that big corps are too busy scaling and often aren’t agile enough to notice.
What was the biggest thing that you learnt personally whilst working at Google?
Always assume best intent.
Anything else?
If you are an investor interested in attending the event, or a suitable start up, you can apply here.
In his second guest post for Angel Investment Network, Dan Simmons, CEO of Propelia, explains ‘How understanding the shift from Product Market Fit to Founder Market Fit in the pre-seed space can now help influence your early stage thinking and planning’:
Understanding The Shift
There is a recognisable shift starting to happen in the early stage space. A shift that is important to be aware of and understand whether you are a founder or investor. A shift away from Product Market Fit and towards Founder Market Fit around and for pre-seed investment. This shift essentially means the way certain angel investors are starting to evaluate early stage founders is beginning to change. Change away from the traditional lenses that model and evaluate Product Market Fit towards a new phase where different tools, frameworks and assessment criteria are at play.
We can see this shift clearly by comparing and contrasting the two diagrams below:
We can see from the Product Market Fit diagram, that as you move forward, it essentially at each stage relies on and is informed by tools and lenses like OKRs, YOY, NPS, KPIs, CAC and CLV to chart founder progression and development. A progression that many founders when trying to structure and project the progress of their start up onto find very difficult to navigate. A difficulty that often then causes them to come up with and put forward assumptions and future projections that are essentially best guesses – just to align with Product Market Fit based questioning and be attractive to and try and close their potential investment.
However we can see that by shifting the focus towards Founder Market Fit, the nature of the early stage journey distinctly and meaningfully changes.
Here we can see that different criteria are being used to assess value and progress of the founder, that utilise much more human language and exploratory values when compared to the tools and lenses of Product Market Fit. This is critical as to why this shift is increasingly attractive to and in the interest of early stage pre-seed founders.
Why This Shift Is Occurring Now?
For a long time the tools of Product Market Fit have been the only way to really evaluate an early stage founder and their future start up journey. This often creates an asymmetry and many ensuing systemic problems in the ongoing dynamics between founder and investor. Both parties when evaluating an early stage funding deal, are of course looking to gain comfort that the road ahead is valuable and worth pursuing together. The tools around Product Market Fit have been an attempt to create that comfort and generate that degree of future certainty.
A certainty that was always speculative at best. Ask any founder who has been asked over and over again to create and then endlessly tweak a 3 year spreadsheet of projections and you will be met with the frustrations and self-evident limitations of this methodology and approach in the pre-seed space.
However will market conditions now very much being set to ‘Uncertain’ post-COVID, it is clear that any founder predicting more than 6 months out is simply putting ‘their finger in the air’ and practising some sort of start up fortune telling with no real basis in the reality of events unfolding on the ground. For the first time, both investors and founders can agree that a change is needed to adapt to this underlying uncertainty – particularly around evaluating those first 6 months in the early stage space. This is all important in creating the conditions for the shift from Product Market Fit to Founder Market Fit.
Who Are Some Of The Key Stakeholders Helping Make This Shift Happen?
This shift is being fuelled by various key stakeholders in the early stage space that are sensing the market timing and opportunity to fuel and propel it forward. These range from early stage funds that are realising that updating towards Founder Market Fit is both valuable, viable and attractive as their pre-seed market positioning. Indeed by adopting this approach it could immediately make them more ‘founder friendly’ and differentiate them from their rival funding firms who are still focused on the tools of Product Market Fit and therefore lack this new perspective. Forward Partners and The Fund are good examples of this or early stage firms talking this language.
However there are also additional stakeholders that are worth noting and exploring further. Here’s a few of them worth exploring.
The legal parties that specialise in the early stage space. Companies like SeedLegals offering Agile Funding solutions that enable founders to take on smaller tranches of funding in a much more fluid and ongoing manner than if they were completing a larger round – see here:
The increasing awareness around Founder wellbeing and how applying the lens and pressure of Product Market Fit too early can have adverse effects on mental health. Many founders report the same symptoms and sleepless nights having to prove the projections they previously plucked from the ‘spreadsheet ether’ last quarter at their next investor meeting. See founder peer support groups like Foundrs who are there to ‘help one another break new ground without breaking ourselves’ and Courier’s excellent Founder wellbeing report.
In recent years this shift has been enabled by the application of R&D and Innovation Grants to the early stage space by forward thinking companies such as GrantTree and Data Fox. These companies have been able to reclaim capital spent and invested in innovative new products, services, processes, software or systems and are often willing to be engaged on a no-win, no-fee, no-risk basis. This has provided an alternative route to financing and capital in the early stage and is particularly well orientated to outputs of Founder Market Fit.
A final stakeholder that has emerged in recent years that helps value this shift differently are firms like Coller IP and Valuation Consulting who are managing to put the softer and intangible assets – like brand, business models, know-how and sweat equity – on the early stage balance so that they can be factored into larger rounds. This starts to assign an actual value to the dynamics of Founder Market Fit that were previously considered to have a marginal worth at best when compared to the more tangible metrics and measures of Product Market Fit.
How This Shift Might Affect Early Stage Funding?
If you are currently engaged in an early stage funding round or indeed considering one, it might be useful to pause and think about the difference in approaches between Product Market Fit and Founder Market Fit. Whilst this shift is visible and happening it is still quite new, even to sophisticated investors who regularly fund founders and their pre-seed start ups.
You should both as founders and investors feel like you have the permission from the outset to discuss and delineate which approach is being taken. They are both very different with different paths with different evaluative criteria and measured outcomes. Critically once you are down one path and everyone is aligned to that approach, it is notoriously hard to reverse out of.
However factored in up front an awareness of the choice around this shift could help fuel a different type of initial conversation between founder and investor that helps from the outset frame and articulate future aims, expectations and values. It could even form part of an early whiteboarding or brainstorming session between founder (and their team) and potential investors.
Just by being aware of the shift and bringing it into the conversation is at the very least a sophisticated early basis for discussion.
How Do You Assess Where You Are On This Shift?
Finally a quick diagram to assess where you are at in relation to this shift. It is suggested that if you are in the pre-seed space then Founder Market Fit may well be the more suitable approach. This may also be the case if you are still in the Seed funding stage.
However it is likely that if you are in the Series A or above that you are further down the line in the territory and terrain of Product Market Fit and its evaluative tools and approach are still more suited to you.
The good news for everyone, is that by being aware of where you are in relationship to this shift, then all conversations and their related lenses, tools and frameworks, can start to hopefully become more ‘fit for purpose’ and ultimately as a result, more valuable for all parties and stakeholders involved.
Propelia is the UK accelerator navigating the use of Pilot Rounds in the pre-seed space in our post-COVID times. A Pilot Round is designed to rapidly connect early stage founders with aligned investors, to enable them to leverage SEIS capital to fuel, test and iterate uncertain market assumptions and prove Founder Market Fit over the next 6 months. Once completed, this enables them to then evaluate and ideally increase the value of the greenlighting of a subsequent larger round to fund the further launch of their product and operations. All diagrams in this article remain the Copyright of Propelia Limited
Investing in tech startups can be daunting, especially if you don’t have a tech background. Investing in new ideas, market opportunities and teams can be exciting, and should remain the most important deciding factors when considering an investment. Here are a few points that you can view more in this article that focuses on from a software due diligence perspective.
Documentation
Documentation is hardly at the top of the priority list of many early stage companies. While the tech team may know all the ins and outs of the project by memory, it will be much harder to onboard new developers or take over the tech if the need arises. Projects and quirks in the systems should be well documented.
At the very least, any startup should have a set of documentation to allow someone else to pick up the project if the key people became incapacitated.
Roadmap
Early stage startups usually fall into the trap of prioritising features due to customer feedback or potential deals in the pipeline. Lacking more information about customer service is a great drawback. Ask for a 12 month roadmap to understand how the product will evolve going forward.
Having a roadmap in place will serve as a general direction, but understand tech startups operate in an agile environment so feature prioritization may change to best achieve market fit.
Resourcing
The convention of a tech startup needs to have a tech team is being challenged. So long as there’s access to reliable resources to build the product, a product can easily go to market whether the team is in-house or not. What matters is how well the company is able to explain the relationship and access of the resource and how these resources are prioritised.
Leveraging third party systems
Early stage startups should focus in building and iterating the core of their product first and foremost. When resources are not widely available the team needs to prioritise what should be built by the company itself versus what third party tools can be integrated into the system. Payment processors like Stripe or Braintree are one the best examples for a product that takes payments but isn’t part of the core offering. Streamline payments with an advanced card machine for your business. Make sure the team is focused sharp in the product USP and integrate other tools to help speed up development.
Customer Data
Another advantage of using third party software is delegating the regulatory requirements and storage of sensitive customer data like credit card and payments. While you shouldn’t expect developers to be experts in data security, the software team should be aware of the current laws, their obligations and have plans to improve security in the product roadmap if it’s not as robust as it could be.
Architecture
There are infinite ways to architect a technical product, and all of them have their pros and cons depending on budget, resources available and product availability.
The most important pitfall to look for is the opportunity for a single point of failure. An example of this would be having your whole test stack plus storage in a single server or virtual machine. In case of failure or unavailability (it happens) this would mean the company and their customers wouldn’t access any data while the incident lasts. Distributing the technical stack between different services or microservices will lessen the risk in case of disaster.
Disaster Recovery
Technology can sometimes be unpredictable, so every tech team should have at least a disaster recovery plan in case there are problems with the hosting of the platform or some external services. Asking about backup location and periodicity, how long would it take to relaunch the tech stack in case of failure will give you an understanding about how much the team is thinking about disaster recovery.
This is by no means meant to be an exhaustive list but should highlight the common areas you should have a high level view over for potential additions to your portfolio (and potentially reviewing these points on your existing investments). All these areas can be relatively easily overcome in the early stages of a company. If these questions throw up something unexpected that gives concern, please speak to a trusted advisor.
Next Steps
If you would like to receive further tips from Silicon Rhino about how to implement Technical Due Diligence, sign up here.
