WEBVTT 00:00:00.000 --> 00:00:02.859 Welcome to the Innovation Conversation, a podcast 00:00:02.859 --> 00:00:05.360 about innovators, both in business and real life. 00:00:05.860 --> 00:00:08.419 Hosted by myself, Ricardo Rescual and Harry McCona. 00:00:08.619 --> 00:00:11.660 This podcast is sponsored by OpenExperts .com. 00:00:11.919 --> 00:00:14.140 OpenExperts is a place to go if you're looking 00:00:14.140 --> 00:00:16.300 to talk with top experts from around the world. 00:00:16.539 --> 00:00:20.879 That is Open -Experts .com. This podcast is also 00:00:20.879 --> 00:00:24.539 sponsored by StartupNetworks .co .uk. Startup 00:00:24.539 --> 00:00:26.820 Networks, it's an online forum where you can 00:00:26.820 --> 00:00:28.739 find all the resources you need to learn your 00:00:28.739 --> 00:00:31.449 startup. from grants to investors to tips and 00:00:31.449 --> 00:00:33.310 tricks on how to be successful in your startup. 00:00:34.490 --> 00:00:36.689 Today, we are talking with Natalie Schwarzkopf, 00:00:37.049 --> 00:00:40.609 an investor from Blackfin Capital Partners. Hi, 00:00:40.670 --> 00:00:42.689 and welcome to another episode of the Innovation 00:00:42.689 --> 00:00:45.170 Conversations. Today, we are joined by Natalie 00:00:45.170 --> 00:00:47.829 Schwarzkopf, an investor from Germany. Natalie, 00:00:48.049 --> 00:00:51.329 welcome. Thank you, Ricardo. Thank you so much 00:00:51.329 --> 00:00:54.070 for having me. It's a pleasure to be here. Yes, 00:00:54.070 --> 00:00:56.770 so I work in Blackfin, and we're an investor, 00:00:57.689 --> 00:00:59.850 or a fund dedicated to financial services. So 00:00:59.850 --> 00:01:02.049 we follow two different strategies. We have on 00:01:02.049 --> 00:01:06.730 one side, a DIGI -Bio strategy, where we do majority 00:01:06.730 --> 00:01:10.989 investment in profitable companies. And the VC 00:01:10.989 --> 00:01:15.629 side of the strategy, where we invest minority. 00:01:16.989 --> 00:01:22.280 Sorry, can I do it again? Minority stakes, where 00:01:22.280 --> 00:01:25.480 we take minority stakes in companies. And yeah, 00:01:25.480 --> 00:01:28.180 I'm part of the VC strategy and we invest in 00:01:28.180 --> 00:01:30.760 European headquarters, Fin and Intratex, from 00:01:30.760 --> 00:01:34.420 series A onwards, so ABC, with initial ticket 00:01:34.420 --> 00:01:38.459 sizes from 5 to 25 million. I'm based out of 00:01:38.459 --> 00:01:41.819 the Frankfurt office of Blythfin. We also have 00:01:41.819 --> 00:01:44.680 other offices in Paris, London and Brussels, 00:01:45.560 --> 00:01:48.159 and also recently opened an office in Amsterdam. 00:01:51.260 --> 00:01:54.239 How do you get started in this? How do you become 00:01:54.239 --> 00:01:57.959 an investor? How do you try a black thing? Well, 00:01:58.079 --> 00:02:00.680 I think my journey as an interviewee was rather 00:02:00.680 --> 00:02:03.719 serendipitous. So in high school, I'd already 00:02:03.719 --> 00:02:07.000 gained my first entrepreneurial experience being 00:02:07.000 --> 00:02:09.439 involved in two voluntary startup projects in 00:02:09.439 --> 00:02:12.539 high school. So for one of them, my team and 00:02:12.539 --> 00:02:15.780 I actually have promised... a 100 ,000 cheque 00:02:15.780 --> 00:02:18.219 from a research institute in Germany to build 00:02:18.219 --> 00:02:21.080 up a lot. And it was a kind of Google Maps for 00:02:21.080 --> 00:02:24.699 airports and train stations with various discounts 00:02:24.699 --> 00:02:27.740 that you can see directly on the app and use 00:02:27.740 --> 00:02:29.680 it for you to see how long it takes them to get 00:02:29.680 --> 00:02:32.819 them to vacate and see the real -time information 00:02:32.819 --> 00:02:36.819 such as the time to go in. And yeah, our idea 00:02:36.819 --> 00:02:39.159 actually got introduced by Larry's app for it. 00:02:39.219 --> 00:02:42.259 It's a series after we won the competition. So 00:02:42.259 --> 00:02:44.860 it also kind of proved that there actually was 00:02:44.860 --> 00:02:49.479 a need. But however, we decided to focus on continuing 00:02:49.479 --> 00:02:52.939 our high school studies instead of dropping out 00:02:52.939 --> 00:02:55.060 of high school, which was not really an option. 00:02:56.180 --> 00:02:58.539 And yeah, also during the high school, as well 00:02:58.539 --> 00:03:02.080 as after it, I spent some time in Asia. When 00:03:02.080 --> 00:03:04.719 I was 14 years old, I went to a local boarding 00:03:04.719 --> 00:03:06.860 school in Shanghai. And after my high school, 00:03:07.120 --> 00:03:11.180 I did a three -year training program. which was 00:03:11.180 --> 00:03:13.879 an extremely valuable personal experience. It 00:03:13.879 --> 00:03:17.960 also shaped me in many, many ways. And yeah, 00:03:18.159 --> 00:03:20.259 after my time in Hong Kong, I decided to finish 00:03:20.259 --> 00:03:23.240 my university studies in business, which I did 00:03:23.240 --> 00:03:25.919 in the Netherlands. And I was out to spending 00:03:25.919 --> 00:03:30.099 like half a year in Santiago de Chile. After 00:03:30.099 --> 00:03:32.719 my university studies and my graduation, which 00:03:32.719 --> 00:03:36.520 was in the middle of COVID in 2020, I had an 00:03:36.520 --> 00:03:39.400 offer to work in a small international team with 00:03:39.400 --> 00:03:42.539 very experienced and inspired people, like working 00:03:42.539 --> 00:03:46.830 on projects in the financial services area. mainly 00:03:46.830 --> 00:03:49.270 for a former senior M .D. at a large private 00:03:49.270 --> 00:03:53.030 equity company who was appointed as CFO to the 00:03:53.030 --> 00:03:56.150 board of a formerly state -owned German bank 00:03:56.150 --> 00:03:59.599 that was acquired by his P .E. company. and also 00:03:59.599 --> 00:04:02.699 together with another senior executive, who was 00:04:02.699 --> 00:04:05.180 one of the first ladies in the board of a German 00:04:05.180 --> 00:04:07.699 financial institution. And they kind of were 00:04:07.699 --> 00:04:10.240 like mentors for me. And I gained a lot of knowledge 00:04:10.240 --> 00:04:13.580 on the European banking market, but also on syntax. 00:04:15.000 --> 00:04:18.100 And yeah, also during that time, I was able to 00:04:18.100 --> 00:04:21.680 develop my coding and modeling skills and sharpen 00:04:21.680 --> 00:04:24.199 them even further, which became super handy, 00:04:24.199 --> 00:04:26.779 like for my current job in DC. Also during that 00:04:26.779 --> 00:04:30.839 time, I was speaking too little fintechs, but 00:04:30.839 --> 00:04:34.220 yeah, kind of more like from the client or acquirer 00:04:34.220 --> 00:04:37.420 perspective. And I realized that I really enjoy 00:04:37.420 --> 00:04:41.000 this kind of mix of analytical and personal skills 00:04:41.000 --> 00:04:44.879 of the job. But to really make impactful decisions 00:04:44.879 --> 00:04:48.480 that are based on how much work we put in, I 00:04:48.480 --> 00:04:51.680 thought I really have to go into VC. So yeah, 00:04:51.680 --> 00:04:54.600 that's how I got into it, like what I know of 00:04:54.600 --> 00:04:57.100 years ago, and I'm really enjoying it a lot. 00:04:57.819 --> 00:05:00.540 And I think also what fascinates me a lot about 00:05:00.540 --> 00:05:03.959 this job is that you get exposure to so many 00:05:03.959 --> 00:05:08.240 brilliant and smart founders with so much experience. 00:05:09.370 --> 00:05:12.569 on it and so many very brilliant ideas on a daily 00:05:12.569 --> 00:05:17.509 basis. So yeah, this is what I really enjoy and 00:05:17.509 --> 00:05:21.189 also my team members. I have an extraordinary 00:05:21.189 --> 00:05:24.730 depth of knowledge in this space. So yeah, I'm 00:05:24.730 --> 00:05:28.050 really grateful to be kind of in this space. 00:05:28.610 --> 00:05:30.209 This is an interesting story because it feels 00:05:30.209 --> 00:05:33.529 like you've Hey, as you say, you kind of you 00:05:33.529 --> 00:05:35.470 kind of started applying for the job when you 00:05:35.470 --> 00:05:39.990 were in high school, right? Because it's pretty 00:05:39.990 --> 00:05:42.069 cool. I was gonna ask you because obviously, 00:05:42.170 --> 00:05:44.149 I know there's a lot of criteria when you're 00:05:44.149 --> 00:05:46.709 looking at any investment, potential investment. 00:05:47.209 --> 00:05:49.470 So what are the key things that you can tell 00:05:49.470 --> 00:05:51.449 me right now and say, you know what, I always 00:05:51.449 --> 00:05:53.209 look forward to these things when I'm looking 00:05:53.209 --> 00:05:58.529 at them. Startups or is it about the financial 00:05:58.529 --> 00:06:02.920 or combination of these two things? So I think 00:06:02.920 --> 00:06:05.360 like, first of all, I mean, we're looking at 00:06:05.360 --> 00:06:07.779 the thin and intricate space, which is already 00:06:07.779 --> 00:06:09.779 kind of a focus space, like in the whole starter 00:06:09.779 --> 00:06:12.420 world. So everything that is kind of related 00:06:12.420 --> 00:06:15.459 to that segment would actually qualify as kind 00:06:15.459 --> 00:06:19.689 of. in scope. And within our scope, we kind of 00:06:19.689 --> 00:06:22.649 yeah, as we invest in from series A onwards, 00:06:23.170 --> 00:06:25.889 we have to speak to a lot of founders, which 00:06:25.889 --> 00:06:28.790 are actually also like in seed or pre seed stage, 00:06:29.250 --> 00:06:32.149 also to yeah, kind of already know the relationship 00:06:32.149 --> 00:06:36.269 from early onwards. And yeah, but also invest 00:06:36.269 --> 00:06:39.199 stage even though they're quite like a little 00:06:39.199 --> 00:06:42.600 bit too early for us we still look at some things 00:06:42.600 --> 00:06:47.319 for example like the traction or also like what's 00:06:47.319 --> 00:06:53.230 the AR development. How are the cost efficiencies? 00:06:53.589 --> 00:06:56.850 Like is the company like burning a lot or is 00:06:56.850 --> 00:07:00.209 it rather like cost -conscious? That's something 00:07:00.209 --> 00:07:05.269 we kind of really particularly look at. But yeah, 00:07:05.269 --> 00:07:08.389 for example, the company hasn't reached the traction 00:07:08.389 --> 00:07:11.769 that are kind of desirable for us. I would say 00:07:11.769 --> 00:07:15.209 like the sweet spot of series A is around like 00:07:15.209 --> 00:07:20.279 1 million annual recurring revenues. If it hasn't 00:07:20.279 --> 00:07:25.220 reached that kind of KPI end or when really when 00:07:25.220 --> 00:07:29.300 yes, it has signed a life time for you. like 00:07:29.300 --> 00:07:32.860 in the B2B space, because they are focusing on 00:07:32.860 --> 00:07:34.680 something like a little bit more like on the 00:07:34.680 --> 00:07:38.339 B2B side of things, then they would still qualify. 00:07:38.779 --> 00:07:42.079 But I think it's kind of a combination of different 00:07:42.079 --> 00:07:47.060 factors that lead us to invest in companies. 00:07:47.759 --> 00:07:52.100 I think certainly the criteria has become like 00:07:52.100 --> 00:07:56.189 for founders to raise have become slightly harder 00:07:56.189 --> 00:07:59.870 in the past few years than in 2021. So yeah, 00:08:00.230 --> 00:08:04.629 kind of seeing your attraction and customers 00:08:04.629 --> 00:08:10.550 that they were able to sign has become more important. 00:08:15.589 --> 00:08:18.329 It's always a combination of different things. 00:08:18.629 --> 00:08:22.490 Team is also quite important for us. So yeah, 00:08:22.649 --> 00:08:25.949 then the team is able to also progress to the 00:08:25.949 --> 00:08:28.949 next stages because I think Series A is a kind 00:08:28.949 --> 00:08:32.570 of in between like the very early stages, but 00:08:32.570 --> 00:08:36.230 also like in the growth stage. And so the founder 00:08:36.230 --> 00:08:42.429 needs to have certain skills that are kind of... 00:08:47.470 --> 00:08:54.590 I was going to ask you, how do you differentiate 00:08:54.590 --> 00:08:58.090 the hype? Like, I was looking at a story of a 00:08:58.090 --> 00:09:00.750 keyword and you got to a level where they had 00:09:00.750 --> 00:09:02.909 a crazy valuation and there was a lot of hype 00:09:02.909 --> 00:09:05.509 behind it, right? But their financials was just 00:09:05.509 --> 00:09:08.350 completely not there. So how do you set that 00:09:08.350 --> 00:09:10.799 apart when you're looking at a company? You might 00:09:10.799 --> 00:09:13.559 need a founder who is very charismatic, has a 00:09:13.559 --> 00:09:17.039 lot going for himself or herself. But how do 00:09:17.039 --> 00:09:18.740 you personally say, you know what, I'm just into 00:09:18.740 --> 00:09:20.740 your financials and actually I don't want to 00:09:20.740 --> 00:09:23.720 invest because it doesn't let up. So did you 00:09:23.720 --> 00:09:26.820 ever come across companies like this? I would 00:09:26.820 --> 00:09:28.759 say we don't really invest in companies that 00:09:28.759 --> 00:09:30.700 are super hyped. Of course, you see a couple 00:09:30.700 --> 00:09:34.600 of business models, for example, like AI, which 00:09:34.600 --> 00:09:38.210 has, yeah. been quite high in the last few years. 00:09:39.549 --> 00:09:42.250 And I think also these companies, they don't 00:09:42.250 --> 00:09:44.669 really have a lot of problems with raising right 00:09:44.669 --> 00:09:49.649 now. So just look at Mistfile, which was just 00:09:49.649 --> 00:09:52.429 closed around, I think, at the end of last year 00:09:52.429 --> 00:09:58.700 again with a crazy valuation. Also, I think in 00:09:58.700 --> 00:10:00.919 the climate tech space, there are also a couple 00:10:00.919 --> 00:10:08.820 of companies. Since we invest in the rather later 00:10:08.820 --> 00:10:13.659 stages, we don't really focus on only the founding 00:10:13.659 --> 00:10:17.000 teams and we wouldn't invest in just the hype. 00:10:18.709 --> 00:10:22.330 Also, yeah, kind of the financials are too important 00:10:22.330 --> 00:10:25.710 also for us. And so that's why. Yeah, but I mean, 00:10:25.769 --> 00:10:29.870 there has always been these crazy companies that 00:10:29.870 --> 00:10:33.350 are raising large amounts. And yeah, I think 00:10:33.350 --> 00:10:37.070 it's probably something more for other VCs. But 00:10:37.070 --> 00:10:40.110 yeah, for us, we kind of also have like a, since 00:10:40.110 --> 00:10:42.610 we have this knowledge on the market and our 00:10:42.610 --> 00:10:45.230 founding members who have been in the financial 00:10:45.230 --> 00:10:51.159 services. Yeah, area for many, many years, and 00:10:51.159 --> 00:10:54.799 also kind of experienced like all the different 00:10:54.799 --> 00:10:58.279 crises and hives. They're more like sensible 00:10:58.279 --> 00:11:03.539 when it comes to investing in super hype deals. 00:11:04.620 --> 00:11:06.779 On that note, when you look at all these companies, 00:11:07.139 --> 00:11:08.399 because I know you're expecting them to be very 00:11:08.399 --> 00:11:11.710 much Do you notice any big difference between 00:11:11.710 --> 00:11:14.190 the constraints in terms of the way that you 00:11:14.190 --> 00:11:16.690 think or not really? It's pretty much all very 00:11:16.690 --> 00:11:23.399 standard. I think the market picked up quite 00:11:23.399 --> 00:11:26.580 much in the UK and in France. That was at least 00:11:26.580 --> 00:11:28.620 my impression. And we also kind of track the 00:11:28.620 --> 00:11:32.620 deals each week that happen like in the Finland 00:11:32.620 --> 00:11:35.740 Intercheck space. So if you're interested in 00:11:35.740 --> 00:11:39.379 that, you can subscribe to our YouTube channel. 00:11:39.779 --> 00:11:42.740 And we also like always posted on LinkedIn. And 00:11:42.740 --> 00:11:45.639 I think it was also like very interesting for 00:11:45.639 --> 00:11:50.360 us. So we always try to Yeah, kind of use this 00:11:50.360 --> 00:11:56.279 statistics for our own kind of knowledge. And 00:11:56.279 --> 00:12:02.299 we had to compare the rounds that happened over 00:12:02.299 --> 00:12:04.399 the last few years, but also in the different 00:12:04.399 --> 00:12:08.379 regions. And you can clearly see that UK is kind 00:12:08.379 --> 00:12:12.379 of an outlier in that sense. And Germany was... 00:12:12.200 --> 00:12:15.620 rather more conscious, like, yeah, like once 00:12:15.620 --> 00:12:17.879 in the last year, there were a lot of like the 00:12:17.879 --> 00:12:22.159 trams last year as well. Or internal rounds. 00:12:23.960 --> 00:12:28.840 But yeah, and I have I have the feeling that 00:12:28.840 --> 00:12:32.039 it's picking up in Germany again. So you see 00:12:32.039 --> 00:12:36.100 a lot of more like investable companies. And 00:12:36.100 --> 00:12:38.899 my feeling was also that a lot of these companies, 00:12:39.259 --> 00:12:41.679 especially in Germany, they managed quite well 00:12:41.679 --> 00:12:45.600 over the crisis with this continued focus on 00:12:45.600 --> 00:12:50.500 profitability. I'm curious to see how the market 00:12:50.500 --> 00:12:57.340 evolves over the next few months. It's slightly 00:12:57.340 --> 00:12:59.240 more complicated than starting a business in 00:12:59.240 --> 00:13:06.070 Germany. because in Germany you actually need 00:13:06.070 --> 00:13:09.049 some some capital to get started and then it's 00:13:09.049 --> 00:13:11.750 fairly more complex plus it's right yeah that's 00:13:11.750 --> 00:13:14.809 true that's true so in Germany for a lot of things 00:13:14.809 --> 00:13:17.070 you still have to go like to the kind of registry 00:13:17.070 --> 00:13:21.990 office um to get papers signed by the specific 00:13:21.990 --> 00:13:25.789 authorities whereas in the UK much more is like 00:13:25.789 --> 00:13:29.629 digitalized and and easier in that sense um you 00:13:29.629 --> 00:13:31.250 don't understand the difference in the size of 00:13:31.250 --> 00:13:33.600 the rounds because I'm not expecting it to be 00:13:33.600 --> 00:13:36.419 European, but do German companies tend to ask 00:13:36.419 --> 00:13:38.779 for a higher round in comparison to the UK ones 00:13:38.779 --> 00:13:41.480 or the other way around? Or how does that work? 00:13:42.840 --> 00:13:47.220 I wouldn't necessarily say so. Yeah, I think 00:13:47.220 --> 00:13:51.620 I have to look more into it. That's alright. 00:13:52.220 --> 00:13:54.419 It's not an interview. I mean, it is technically 00:13:54.419 --> 00:13:55.820 an interview, but it's not like a job interview, 00:13:56.019 --> 00:13:58.179 so it's a good way to start thinking about other 00:13:58.179 --> 00:14:01.590 things. So I wanted to ask you about Obviously, 00:14:01.730 --> 00:14:03.529 I know you travel a lot. I know you have traveled 00:14:03.529 --> 00:14:07.230 a lot. Which countries, I don't know how to phrase 00:14:07.230 --> 00:14:11.210 that, comparing Europe to the US, what are they 00:14:11.210 --> 00:14:12.929 doing differently? Because obviously the value 00:14:12.929 --> 00:14:14.889 they create in the global economy is much, much 00:14:14.889 --> 00:14:17.970 higher. So why do you think that's so? What sets 00:14:17.970 --> 00:14:23.100 them apart? I think the US investors and also 00:14:23.100 --> 00:14:27.440 startups are way more risk taking than the European 00:14:27.440 --> 00:14:31.500 ones. So and yeah, I mean, they also still you 00:14:31.500 --> 00:14:35.929 can see it like in the growth round. So American 00:14:35.929 --> 00:14:40.110 investors, they still want like a large kind 00:14:40.110 --> 00:14:45.690 of growth with extreme burn costs. Whereas the 00:14:45.690 --> 00:14:48.250 European investors and the whole market in Europe 00:14:48.250 --> 00:14:51.809 has become more like towards kind of building 00:14:51.809 --> 00:14:55.750 more like a sustainable market and businesses. 00:14:57.289 --> 00:14:59.970 But yeah, I think that's probably also because 00:14:59.970 --> 00:15:04.720 of the mentality. in the U .S. and also maybe 00:15:04.720 --> 00:15:08.379 history -wise and since there is also a lot more 00:15:08.379 --> 00:15:11.799 guide power to deploy in the U .S. yeah so kind 00:15:11.799 --> 00:15:14.240 of they they're focusing more like on than on 00:15:14.240 --> 00:15:17.960 us as a coach of the yeah getting family started 00:15:17.960 --> 00:15:22.909 and if you don't see then you still are all over 00:15:22.909 --> 00:15:26.710 again and do it in a different way whereas in 00:15:26.710 --> 00:15:30.269 Germany you kind of try or like in other countries 00:15:30.269 --> 00:15:33.690 in Europe you just try and if it doesn't succeed 00:15:33.690 --> 00:15:37.669 then you try to adapt your business until it 00:15:37.669 --> 00:15:41.610 works but you don't fail completely in that sense 00:15:41.610 --> 00:15:46.590 and so yeah kind of you pivot a lot but yeah 00:15:46.590 --> 00:15:51.269 it's a kind of different also mentality. I have 00:15:51.269 --> 00:15:53.610 to ask you this question, right? Because you're 00:15:53.610 --> 00:15:55.730 on the receiving end of a lot of pitch decks, 00:15:55.950 --> 00:15:59.909 a lot of outreaches from startups. Now, what's 00:15:59.909 --> 00:16:02.470 the best way to reach out to an investor? Because 00:16:02.470 --> 00:16:04.769 there's a lot of software out there that kind 00:16:04.769 --> 00:16:06.289 of helps you reach out to investors. There's 00:16:06.289 --> 00:16:08.309 a lot of groups that don't do things like that. 00:16:08.490 --> 00:16:10.690 And there's also these hyper -connected people. 00:16:11.190 --> 00:16:13.730 So what do you think is the best way as an investor 00:16:13.730 --> 00:16:16.470 to A, receive a pitch deck? But also for startup 00:16:16.470 --> 00:16:17.970 to say, you know, I want to reach out to them. 00:16:18.110 --> 00:16:21.549 This is how it normally works. I think the best 00:16:21.549 --> 00:16:24.090 way is always to get like a warm introduction 00:16:24.090 --> 00:16:27.230 from another investor or where some of them needed 00:16:27.230 --> 00:16:30.929 an event because then you can also like maybe 00:16:30.929 --> 00:16:35.809 see if the yeah, kind of, yeah, sound very good. 00:16:37.370 --> 00:16:39.750 So I think the best way is always like to get 00:16:39.750 --> 00:16:43.590 a warm introduction by like another investor 00:16:43.590 --> 00:16:47.690 or It's also very valuable if you meet people 00:16:47.690 --> 00:16:50.350 at events because you already have a sense of 00:16:50.350 --> 00:16:57.529 the person. And if he's able to manage investors 00:16:57.529 --> 00:17:01.470 and the company. And since I think the job is 00:17:01.470 --> 00:17:07.369 also very much on deciding on kind of... Sorry. 00:17:10.490 --> 00:17:14.170 So, but I think it's also okay if founders would 00:17:14.170 --> 00:17:18.269 just reach out via LinkedIn, maybe like tell 00:17:18.269 --> 00:17:22.549 a few things about their business and why you 00:17:22.549 --> 00:17:25.109 should have a look at them. That's also like 00:17:25.109 --> 00:17:28.630 a good way. So I think it's not the best way. 00:17:29.410 --> 00:17:34.349 I think it's always certainly kind of weird to 00:17:34.349 --> 00:17:39.000 get... cool outreaches by founders, especially 00:17:39.000 --> 00:17:41.980 if you have the feeling that they don't really 00:17:41.980 --> 00:17:44.279 have a look on the website of us, what we're 00:17:44.279 --> 00:17:47.220 doing. Since we're focusing on fin and intro 00:17:47.220 --> 00:17:50.460 text, we probably won't look at a gaming company 00:17:50.460 --> 00:17:54.480 or something like kind of in the e -commerce 00:17:54.480 --> 00:17:57.339 space, which is not related to fintech. So I 00:17:57.339 --> 00:18:02.640 think it's usually also like low who you're kind 00:18:02.640 --> 00:18:06.900 of reaching out to. So to get back from research 00:18:06.900 --> 00:18:09.200 and when you do reach out, make sure it's signed 00:18:09.200 --> 00:18:13.680 for someone. Exactly. Yeah, I think I think that's 00:18:13.680 --> 00:18:17.140 the issue is that we actually met through my 00:18:17.140 --> 00:18:20.460 very fragmented shopping approach, where I emailed 00:18:20.460 --> 00:18:23.839 thousands and thousands of investors. So probably 00:18:23.839 --> 00:18:26.779 not the best way to do that. But yeah, it's always 00:18:26.779 --> 00:18:29.240 interesting to know this because I know that 00:18:29.240 --> 00:18:31.240 a lot of investors get a lot of pitch decks, 00:18:31.519 --> 00:18:34.079 and it just kind of overflows their very boxes, 00:18:34.259 --> 00:18:37.700 right? So it's not the best way to do that. So 00:18:37.700 --> 00:18:41.700 interesting. Okay, so in all these markets, where 00:18:41.700 --> 00:18:44.960 do you think that the investors are less risk 00:18:44.960 --> 00:18:48.220 -averse, so they're more willing to gamble with 00:18:48.220 --> 00:18:51.200 their funds? This is a bit of a thick question. 00:18:51.339 --> 00:18:53.680 Where do you think they're more likely to, say, 00:18:54.039 --> 00:18:57.079 you know, not really here, let's see how it goes. 00:18:58.540 --> 00:19:01.160 I think it's currently, I think I already touched 00:19:01.160 --> 00:19:04.819 upon it a little bit. But I think in the AI space, 00:19:06.240 --> 00:19:10.079 for most cases, those are these solutions that 00:19:10.079 --> 00:19:13.579 improve the efficiency of processes. So they 00:19:13.579 --> 00:19:16.740 really have a significant value add for companies 00:19:16.740 --> 00:19:21.819 and are aimed like to sign probably also a lot 00:19:21.819 --> 00:19:25.819 of companies. And so this is already a good sign 00:19:25.819 --> 00:19:31.440 for investors. Also, these solutions also tend 00:19:31.440 --> 00:19:34.900 to have a healthy technology. Doing diligence 00:19:34.900 --> 00:19:39.619 on that specific area probably also turns out 00:19:39.619 --> 00:19:44.740 well. Also, normally, if you're building AI solutions, 00:19:45.319 --> 00:19:47.480 you also need to, as a founder, you need to have 00:19:47.480 --> 00:19:50.680 some technical skills. in that case, you would 00:19:50.680 --> 00:19:54.259 also take a box in that sense. So yeah, since 00:19:54.259 --> 00:19:58.359 it's quite tight at the moment, and everyone 00:19:58.359 --> 00:20:02.359 kind of wants to invest in that area, I would 00:20:02.359 --> 00:20:06.539 assume that investors probably don't have that 00:20:06.539 --> 00:20:11.420 many harsh criteria in that area. And it also 00:20:11.420 --> 00:20:18.109 goes for client and tech. that I had the impression 00:20:18.109 --> 00:20:20.970 were not so much affected by the market cool 00:20:20.970 --> 00:20:23.769 down. And here's a lot of corporates here and 00:20:23.769 --> 00:20:28.910 here as well have ESG on their agenda and they 00:20:28.910 --> 00:20:32.069 really have a continued interest to fulfill the 00:20:32.069 --> 00:20:38.329 ESG, ESG build. So therefore it goes along with 00:20:38.329 --> 00:20:43.759 that investors Probably you also have these CSG 00:20:43.759 --> 00:20:49.859 agendas and therefore, yeah, probably, yeah, 00:20:50.180 --> 00:20:56.960 invest in colonies in that field. So would you 00:20:56.960 --> 00:20:59.759 sell for startup, stop what you're doing, just 00:20:59.759 --> 00:21:03.000 build me something that has AI and the climate 00:21:03.000 --> 00:21:05.299 tech or something like that, or some ESG in the 00:21:05.299 --> 00:21:07.700 middle? Because we know that you got to get investment 00:21:07.700 --> 00:21:09.559 one way or the other. Would you say that's a 00:21:09.559 --> 00:21:14.210 company? Yeah, I think it also depends on so 00:21:14.210 --> 00:21:18.269 many other factors, also like who the investors 00:21:18.269 --> 00:21:22.230 are, how the market is at that time. And I think 00:21:22.230 --> 00:21:24.990 also like, I mean, if you're building something 00:21:24.990 --> 00:21:29.529 now, the chances are that you probably have to 00:21:29.529 --> 00:21:32.829 change it before you sell it at that height, 00:21:32.970 --> 00:21:36.809 because the market when you're probably on sell 00:21:36.809 --> 00:21:41.480 or IPO is completely different. than the one 00:21:41.480 --> 00:21:45.099 that you're building for now. So therefore, I 00:21:45.099 --> 00:21:49.259 think it's quite important also to be close to 00:21:49.259 --> 00:21:52.440 the customers and flexibly on the changing market 00:21:52.440 --> 00:21:56.700 conditions and need. So therefore, yeah, I probably 00:21:56.700 --> 00:21:59.339 wouldn't say you should go to that area, but 00:21:59.339 --> 00:22:03.900 also listening close to your customers and observe 00:22:03.900 --> 00:22:08.140 what's out in the market right now. And it's 00:22:08.140 --> 00:22:10.859 currently, it's for now, like it's a trend for 00:22:10.859 --> 00:22:13.559 now, but we don't really know what the trend 00:22:13.559 --> 00:22:16.480 will be like for a couple of years in the time. 00:22:17.059 --> 00:22:20.400 Yeah, true. I mean, I was looking at, I was talking 00:22:20.400 --> 00:22:22.220 to a couple of people looking at success on AI 00:22:22.220 --> 00:22:24.680 and the value it's going to bring to the world 00:22:24.680 --> 00:22:27.940 economy. It's true. It's actually amazing. But 00:22:27.940 --> 00:22:31.599 then you cannot help but wonder what's the downside? 00:22:31.980 --> 00:22:33.960 I mean, are people going to use their jobs over 00:22:33.960 --> 00:22:36.099 this? Which I'm sure that we have a lot of people 00:22:36.099 --> 00:22:39.660 who use their jobs over this. Um, and also like 00:22:39.660 --> 00:22:41.539 how, how impactful is this? This is going to 00:22:41.539 --> 00:22:45.619 be the whole AI. It's going to be in a very exciting 00:22:45.619 --> 00:22:47.839 space to be in, I think, but also it's going 00:22:47.839 --> 00:22:50.619 to be moving, right? There's a lot of that. For 00:22:50.619 --> 00:22:52.259 example, let's say that the companies that do 00:22:52.259 --> 00:22:54.240 this, um, with any picture and then the picture 00:22:54.240 --> 00:22:57.000 changes and, you know, it's one old pirate and 00:22:57.000 --> 00:22:58.940 then become a pirate and stuff like that. And 00:22:58.940 --> 00:23:01.299 if you just will start doing that, that you might 00:23:01.299 --> 00:23:03.140 not affect the level, you might not grow that 00:23:03.140 --> 00:23:04.859 well in the future, right? Cause it's very limited. 00:23:06.919 --> 00:23:10.319 Yeah, that's true. How much, like, when you look 00:23:10.319 --> 00:23:13.440 at the syntax space, how ripe is it for disruption? 00:23:14.000 --> 00:23:15.900 Because distribution is slow -moving, it's quite 00:23:15.900 --> 00:23:18.359 easy. You know, banks, for example, don't offer 00:23:18.359 --> 00:23:21.859 the technology. So how ripe is it for disruption, 00:23:21.859 --> 00:23:25.390 if we're wrong? I think it depends also a little 00:23:25.390 --> 00:23:28.670 bit on the sector or in a space. So I think some 00:23:28.670 --> 00:23:32.829 areas, for example, like in the compliance segment 00:23:32.829 --> 00:23:36.509 or like KYC, KYB space, there's still a lot of 00:23:36.509 --> 00:23:39.549 potential for disruptions. I looked at the market 00:23:39.549 --> 00:23:44.029 framework in the summer, and I had the feeling 00:23:44.029 --> 00:23:47.849 that still a lot of processes are done very manual. 00:23:48.650 --> 00:23:52.089 So for example, like to do like a KYB check, 00:23:52.750 --> 00:23:56.210 you really need to go to the bank, introduce 00:23:56.210 --> 00:24:00.490 yourself, get a copy of your password, and then 00:24:00.490 --> 00:24:04.690 the bank kind of does a check. But I think here 00:24:04.690 --> 00:24:09.589 you can really bring a lot of innovation in the 00:24:09.589 --> 00:24:14.529 market, also with AI or automation. I think therefore, 00:24:15.109 --> 00:24:17.470 this is a really interesting segment, rec check. 00:24:18.170 --> 00:24:21.230 following it quite closely and yeah there's certainly 00:24:21.230 --> 00:24:26.069 other areas like um which have typically um yeah 00:24:26.069 --> 00:24:29.650 kind of which were served by large corporates 00:24:29.650 --> 00:24:35.170 before, but now I have the feeling that the trust 00:24:35.170 --> 00:24:39.970 in fintechs is more established than a couple 00:24:39.970 --> 00:24:43.210 of years ago. For example, we were also looking 00:24:43.210 --> 00:24:46.609 at one sector in the supply chain financing area 00:24:46.609 --> 00:24:49.769 and my feeling was that the companies in that 00:24:49.769 --> 00:24:53.609 sector or the fintechs were competing only with 00:24:53.609 --> 00:24:56.990 like Yeah, large banks in that sense. But the 00:24:56.990 --> 00:24:59.809 fintechs that were around it were already like, 00:24:59.809 --> 00:25:04.910 oh, and 10 years old. So, yeah, and banks were 00:25:04.910 --> 00:25:08.990 more and more willing to collaborate with them. 00:25:10.759 --> 00:25:14.579 because they now reached a certain size, they 00:25:14.579 --> 00:25:18.140 reached certain clients, they tested the solution 00:25:18.140 --> 00:25:21.359 so the technology was kind of solid or is solid. 00:25:22.559 --> 00:25:26.759 So there's much more acceptance on fintech players 00:25:26.759 --> 00:25:29.539 in the market, which I think brings a lot of 00:25:29.539 --> 00:25:34.000 value and therefore there's always room for innovation 00:25:34.000 --> 00:25:41.000 in the market and disruption. I'm curious to 00:25:41.000 --> 00:25:45.940 see which area is the next. You touched upon 00:25:45.940 --> 00:25:47.960 something quite interesting, which is banks, 00:25:47.980 --> 00:25:50.539 traditionally, they won't want to do business 00:25:50.539 --> 00:25:53.859 with an early -stage startup, maybe in series, 00:25:53.859 --> 00:25:57.359 CSA startup. How do you get past that and how 00:25:57.359 --> 00:25:59.140 do you build trust with, for example, a bank, 00:25:59.220 --> 00:26:00.960 as we talked about in the first few things here? 00:26:01.279 --> 00:26:04.460 How do you get past that stage where your clients 00:26:04.460 --> 00:26:07.200 will be very large institutions? How do you build 00:26:07.200 --> 00:26:10.660 that trust for them? I think, first of all, the 00:26:10.660 --> 00:26:12.880 most important thing is that your solution is 00:26:12.880 --> 00:26:16.460 actually working. And if it doesn't work, if 00:26:16.460 --> 00:26:19.059 it doesn't work, then you as a startup, you find 00:26:19.059 --> 00:26:24.700 a solution to make it work. And if you have continued 00:26:24.700 --> 00:26:29.569 good feedback of clients, then I think it's easy 00:26:29.569 --> 00:26:34.849 to also sell other corporates. And I think in 00:26:34.849 --> 00:26:37.230 the past a lot of companies were focusing first 00:26:37.230 --> 00:26:41.799 on the mid -market segment. or small and mid 00:26:41.799 --> 00:26:44.619 -market segment. And then we're working the way 00:26:44.619 --> 00:26:48.759 up to large corporates. Because then they reached 00:26:48.759 --> 00:26:52.920 a certain size, they became interesting for corporates. 00:26:53.940 --> 00:26:56.759 So I think now it's changed a little bit. So 00:26:56.759 --> 00:27:00.259 some companies are already targeting large corporates. 00:27:00.900 --> 00:27:05.160 But yeah, I think that's a thing that you need 00:27:05.160 --> 00:27:10.789 to kind of... make sure that you also have interesting 00:27:10.789 --> 00:27:14.710 partnerships, which is also a good way to get 00:27:14.710 --> 00:27:20.029 into, to sign conference in partnerships that 00:27:20.029 --> 00:27:23.509 are relevant, where you can able to demonstrate 00:27:23.509 --> 00:27:26.670 that if they already sign you or they suggest 00:27:26.670 --> 00:27:32.250 you, then this will seem to work and yeah, well, 00:27:32.349 --> 00:27:37.940 kind of improve processes. because they're saying 00:27:37.940 --> 00:27:42.539 superhuman beings or who actually is something 00:27:42.539 --> 00:27:45.940 innovative. I was wondering about something else. 00:27:46.160 --> 00:27:48.160 I was reading a post the other day on my feed 00:27:48.160 --> 00:27:54.019 and some random guy was bragging about how he 00:27:54.019 --> 00:27:56.359 gets thousands and thousands of pitch checks 00:27:56.359 --> 00:28:00.980 every year but he only looks at 0 .01 % and then 00:28:00.980 --> 00:28:03.759 when he won though, obviously he was being a 00:28:03.759 --> 00:28:09.539 bit of a What does that process look like from 00:28:09.539 --> 00:28:11.900 your side? When you get a pitch deck, how many 00:28:11.900 --> 00:28:15.279 people actually work it in? Do all pitch decks 00:28:15.279 --> 00:28:18.819 get hooked upon or not really? Who looks at these 00:28:18.819 --> 00:28:20.980 pitch decks? How does that process work on the 00:28:20.980 --> 00:28:24.839 other side? I would say that we look at all of 00:28:24.839 --> 00:28:30.140 the pitch decks that we receive. Depends a little 00:28:30.140 --> 00:28:33.160 bit on which channel, like, I think, like, if 00:28:33.160 --> 00:28:36.539 I receive one on my personal mail, or my LinkedIn, 00:28:36.680 --> 00:28:39.539 then of course, I will have a look at them. If 00:28:39.539 --> 00:28:44.240 it's on our kind of company, yeah, sort of email 00:28:44.240 --> 00:28:48.059 address, which is for everyone, then I'm not 00:28:48.059 --> 00:28:52.549 sure. who would look at it. So it's always better 00:28:52.549 --> 00:28:55.410 like to send like kind of the emails to the right 00:28:55.410 --> 00:28:58.910 people. And so at Blackfin we got so kind of 00:28:58.910 --> 00:29:02.049 divided into different regions. And also like 00:29:02.049 --> 00:29:05.750 I based in the specific region. So as I'm based 00:29:05.750 --> 00:29:08.410 in Frankfurt, I'm covering the whole like Germany. 00:29:08.829 --> 00:29:13.670 Austria and Swiss market, and colleagues of mine 00:29:13.670 --> 00:29:16.789 that are based in the UK are covering, of course, 00:29:17.029 --> 00:29:20.849 the UK market. Other colleagues who are in France 00:29:20.849 --> 00:29:24.869 covering France, obviously, or in the Nordics, 00:29:25.890 --> 00:29:31.470 and Southern Europe, or Benelux. So usually it's 00:29:31.470 --> 00:29:34.250 the people who are responsible for the region 00:29:34.250 --> 00:29:40.539 will look at the... And in the DL team, they're 00:29:40.539 --> 00:29:43.099 normally like three to four people, I would say. 00:29:45.240 --> 00:29:48.559 And yeah, it depends a little bit like on the 00:29:48.559 --> 00:29:51.180 segment. So for example, in our team, you have 00:29:51.180 --> 00:29:55.009 some experts. So for example, I have one colleague 00:29:55.009 --> 00:29:58.329 who worked in the final administrator sector 00:29:58.329 --> 00:30:01.529 for a couple of years. So she's kind of the expert 00:30:01.529 --> 00:30:05.970 on all topics that are related to that. So if 00:30:05.970 --> 00:30:07.849 we would see a deal in the next days, we would 00:30:07.849 --> 00:30:14.500 always ask for some advice. Sometimes it's also 00:30:14.500 --> 00:30:17.579 just me who look at the finish dates and if I 00:30:17.579 --> 00:30:19.940 found the opportunity interesting, I also like 00:30:19.940 --> 00:30:23.299 to push forward and yeah, I have a first call 00:30:23.299 --> 00:30:27.299 with the founders and if the call was positive 00:30:27.299 --> 00:30:30.660 and I like the opportunity, I usually present 00:30:30.660 --> 00:30:35.119 the opportunity in our team meeting like every 00:30:35.119 --> 00:30:38.839 Monday and then yeah, kind of with a one -pager 00:30:38.839 --> 00:30:43.150 on the company. And yeah, if my team members 00:30:43.150 --> 00:30:45.829 find the opportunity interesting, we will go 00:30:45.829 --> 00:30:50.210 further and dig more deeper into the company. 00:30:51.009 --> 00:30:54.609 But yeah, this is, yeah. How many, how many get 00:30:54.609 --> 00:30:59.150 checks do you go on average? Ah, I've never counted 00:30:59.150 --> 00:31:04.829 them. But I think, I would say I would, I mean, 00:31:04.849 --> 00:31:06.430 it depends a little bit on the leaves because 00:31:06.430 --> 00:31:09.569 I think No week is kind of the same as the other 00:31:09.569 --> 00:31:12.289 and no day is like the same as the other. But 00:31:12.289 --> 00:31:14.930 I think I would speak to, I would say like four 00:31:14.930 --> 00:31:19.609 to five companies per week. Sometimes more, sometimes 00:31:19.609 --> 00:31:23.150 less, of course. And the pitch decks, I would 00:31:23.150 --> 00:31:26.150 probably receive... I mean, it depends a little 00:31:26.150 --> 00:31:29.069 bit because I want to do a lot of cool outreach 00:31:29.069 --> 00:31:32.890 lists to founders. Or if I see a company that 00:31:32.890 --> 00:31:35.289 I'm interested in speaking to, but they're not 00:31:35.289 --> 00:31:37.390 raising, they probably don't have a pitch check. 00:31:38.170 --> 00:31:42.529 So I just collect notes of the meeting and that 00:31:42.529 --> 00:31:48.390 will kind of also serve as a test basis. But 00:31:48.390 --> 00:31:52.049 the pitch checks I received over the last three 00:31:52.049 --> 00:31:55.599 years were... Probably like, yeah, maybe I would 00:31:55.599 --> 00:31:59.799 say on average, maybe three per week. So also 00:31:59.799 --> 00:32:02.619 often I get them and then I don't really find 00:32:02.619 --> 00:32:05.519 the opportunity interesting. So I'm not really 00:32:05.519 --> 00:32:12.359 in the call. But I think people know that we 00:32:12.359 --> 00:32:15.900 kind of also like series A investors. So I guess 00:32:15.900 --> 00:32:19.220 that seed investors probably getting a lot more 00:32:19.220 --> 00:32:25.660 than us. Um, but, uh, yeah. It must be crazy 00:32:25.660 --> 00:32:28.160 for a city investor to get, there are many pitch 00:32:28.160 --> 00:32:31.019 decks, right? Cause everyone wants to start something. 00:32:31.200 --> 00:32:33.519 So it must be absolutely crazy. On that though, 00:32:33.720 --> 00:32:35.880 do you use any software to analyze the pitch 00:32:35.880 --> 00:32:37.720 decks? Cause now there's a lot of AI solutions 00:32:37.720 --> 00:32:40.700 that just bring down the whole thing and say, 00:32:40.859 --> 00:32:43.259 oh, this is good, this is not good based on A, 00:32:43.279 --> 00:32:45.859 B and C. Like, do you use any type of AI solutions 00:32:45.859 --> 00:32:48.019 for that or is it still very much a random process? 00:32:48.829 --> 00:32:51.730 Not so far. I mean, it's quite a manual process. 00:32:52.289 --> 00:32:55.809 I think there are certain things we look at to 00:32:55.809 --> 00:32:59.450 assess whether a company is interesting. So first 00:32:59.450 --> 00:33:03.289 of all, of course, the product, then the traction, 00:33:03.690 --> 00:33:06.269 if they have a site on that, typically they have 00:33:06.269 --> 00:33:09.789 like from series A onwards, C stage, it's not 00:33:09.789 --> 00:33:13.230 so common, I would say, but also go to market 00:33:13.230 --> 00:33:15.789 or sales channel. But I think it depends a little 00:33:15.789 --> 00:33:18.630 bit on the... on the segment we're looking at. 00:33:19.990 --> 00:33:24.650 So, yeah, but I think part of what has done it 00:33:24.650 --> 00:33:27.589 better and also like the fundraising deck is 00:33:27.589 --> 00:33:31.910 also something that we find particularly interesting. 00:33:32.829 --> 00:33:37.430 You know, if you have one advice to give to founders, 00:33:37.890 --> 00:33:42.420 what would that advice be? It's really important 00:33:42.420 --> 00:33:45.019 in the end to kind of understand the environment 00:33:45.019 --> 00:33:49.339 as you're in as a founder. And I think it's absolutely 00:33:49.339 --> 00:33:54.619 crucial to act flexibly and with us to the customer 00:33:54.619 --> 00:34:00.339 needs. Yeah, I think also in terms of deal terms 00:34:00.339 --> 00:34:03.000 and valuations, I think founders should not go 00:34:03.000 --> 00:34:05.640 for the absolute minimum dilution. yeah, trying 00:34:05.640 --> 00:34:08.579 to get to some crazy valuation. So they should 00:34:08.579 --> 00:34:13.019 rather anticipate and party with 50 % to 25 % 00:34:13.019 --> 00:34:16.300 of the company in typical. So yeah, kind of not 00:34:16.300 --> 00:34:20.539 doing these crazy competitive rounds. And yeah, 00:34:20.679 --> 00:34:23.639 I think also that sounds one thing that founders 00:34:23.639 --> 00:34:26.340 should expect is especially like in birdie funding 00:34:26.340 --> 00:34:30.260 rounds is a clean trump sheet without like burl 00:34:30.260 --> 00:34:32.880 some veto voting rights or multiple election 00:34:32.880 --> 00:34:36.860 references. because it could really like, yeah, 00:34:36.900 --> 00:34:42.340 kind of become like something which could obstruct 00:34:42.340 --> 00:34:47.800 your later rounds as a founder. And I think also 00:34:47.800 --> 00:34:51.539 what is important for founders is they should 00:34:51.539 --> 00:34:54.179 account for more time and for more runway when 00:34:54.179 --> 00:34:56.860 raising money. So I think the time also they 00:34:56.860 --> 00:35:01.969 have to raise a serious fee round. I read a statistic 00:35:01.969 --> 00:35:07.269 from CARTA. It has grown to 85 % over the last 00:35:07.269 --> 00:35:10.710 three years. So if you should rather raise when 00:35:10.710 --> 00:35:12.769 you still have money, not when you have drugs. 00:35:14.010 --> 00:35:17.550 And I think really you should try to be close 00:35:17.550 --> 00:35:19.789 to the customers, really, really understand the 00:35:19.789 --> 00:35:24.670 market they're in and building alongside them, 00:35:24.829 --> 00:35:28.599 understanding their needs. Because I think those 00:35:28.599 --> 00:35:31.579 companies who followed this approach also like 00:35:31.579 --> 00:35:34.800 in the last two years, they are the successful 00:35:34.800 --> 00:35:37.619 ones. And I think the startups that are in trouble 00:35:37.619 --> 00:35:40.900 now are the ones that wanted to build that product 00:35:40.900 --> 00:35:46.380 like fast and scale really fast and also were 00:35:46.380 --> 00:35:50.360 able to keep their costs under control. And another 00:35:50.360 --> 00:35:56.389 really important thing, which is also Yeah, quite 00:35:56.389 --> 00:35:59.730 crucial for the fundraising process. As a founder, 00:35:59.949 --> 00:36:02.909 I think you should really focus on building investor 00:36:02.909 --> 00:36:06.570 relations early on and also update interested 00:36:06.570 --> 00:36:10.070 investors on a regular basis because then you 00:36:10.070 --> 00:36:12.110 really spend too much time during your fundraising 00:36:12.110 --> 00:36:15.710 process to explain your product and business 00:36:15.710 --> 00:36:19.869 all over again. And my impression was also like 00:36:19.869 --> 00:36:22.309 when speaking to founders that they really want 00:36:22.309 --> 00:36:25.940 to raise the more specialized fund. I'm not sure 00:36:25.940 --> 00:36:28.340 if it's a bias because, you know, like I'm focused 00:36:28.340 --> 00:36:31.260 on a fill -in intertext, but that's a feedback 00:36:31.260 --> 00:36:34.920 that I continuously hear from founders, that 00:36:34.920 --> 00:36:37.460 they're really looking for someone kind of who 00:36:37.460 --> 00:36:40.079 brings like a strategic angle to the company. 00:36:41.980 --> 00:36:47.300 So, yeah, that's Bosna Metis. It's interesting 00:36:47.300 --> 00:36:50.099 because you mentioned something that I wasn't 00:36:50.099 --> 00:36:52.519 aware of, that it's actually much harder, not 00:36:52.519 --> 00:36:55.190 much harder, but... The market's also slowing 00:36:55.190 --> 00:36:58.570 down raising CSK, BNC. Why is that happening? 00:36:58.929 --> 00:37:00.550 Because everyone's complaining about how slow 00:37:00.550 --> 00:37:02.849 the market is, how hard it is to raise. I thought 00:37:02.849 --> 00:37:04.730 series A's would be like, you know, you made 00:37:04.730 --> 00:37:06.909 it so we're safe now, but actually, you tell 00:37:06.909 --> 00:37:08.329 me it's the other way around. It's actually quite 00:37:08.329 --> 00:37:10.190 hard for yourself. So what do you think that 00:37:10.190 --> 00:37:12.130 is? Is there anything you can do to change that? 00:37:14.309 --> 00:37:16.989 Yeah, I think it's, I mean, it's something that 00:37:16.989 --> 00:37:19.570 probably you can see like in every stage of development. 00:37:20.289 --> 00:37:25.199 I think In the past, especially in 2021, which 00:37:25.199 --> 00:37:28.500 was definitely not a year to compare to this 00:37:28.500 --> 00:37:32.039 year, the valuations were extremely high and 00:37:32.039 --> 00:37:36.820 a lot sustainable. The balance was super big 00:37:36.820 --> 00:37:41.519 and bigger and better, but not necessarily better 00:37:41.519 --> 00:37:44.920 for growth and sustainability. I think it changed 00:37:44.920 --> 00:37:51.050 a lot in the past three years. because the valuations 00:37:51.050 --> 00:37:54.730 start to come on the KPIs that investors like 00:37:54.730 --> 00:37:57.489 to see also become more straight. And I think 00:37:57.489 --> 00:38:01.110 this is also leading to capital costs that are 00:38:01.110 --> 00:38:03.570 now significantly higher than in the last decade, 00:38:04.070 --> 00:38:07.690 which means that it obviously becomes more difficult 00:38:07.690 --> 00:38:11.630 to raise. And yeah, so, you know, like, since 00:38:11.630 --> 00:38:13.690 the investment market orientates itself like 00:38:13.690 --> 00:38:16.590 on the interest rate market, and we haven't really 00:38:16.590 --> 00:38:20.159 reached any significant interest level or interest 00:38:20.159 --> 00:38:23.400 plateau. And I don't think that the fundraising 00:38:23.400 --> 00:38:27.300 market, especially like in the like later stages, 00:38:28.019 --> 00:38:31.699 change much because we haven't really seen like 00:38:31.699 --> 00:38:34.119 the full consequences of the market crash yet. 00:38:35.119 --> 00:38:39.920 And therefore, I think if the capital cost or 00:38:39.920 --> 00:38:42.239 the interest level if they don't really kind 00:38:42.239 --> 00:38:47.550 of change significance in our favor, then Yeah, 00:38:47.710 --> 00:38:51.110 it probably won't change that much like until 00:38:51.110 --> 00:38:57.250 2020. But yeah, I think, yeah. So there needs 00:38:57.250 --> 00:39:02.889 to be a reduction in the industry. I mean, it's 00:39:02.889 --> 00:39:05.309 not necessarily that sign, I would say. I mean, 00:39:05.349 --> 00:39:09.230 if you look at the vintage years, years after 00:39:09.230 --> 00:39:11.889 the dotcom bubble or the financial crisis, you 00:39:11.889 --> 00:39:15.260 see actually in those years, were super formative, 00:39:15.579 --> 00:39:17.500 meaning that those years also brought a lot of 00:39:17.500 --> 00:39:20.880 innovation to the market and brought very strong 00:39:20.880 --> 00:39:24.800 innovative companies. And also, like, if you 00:39:24.800 --> 00:39:26.780 look at the fund performance and the returns 00:39:26.780 --> 00:39:30.739 of VC firms, they were able to achieve during 00:39:30.739 --> 00:39:33.760 those years. It was one of the strongest years 00:39:33.760 --> 00:39:36.460 in venture capital. Yeah, therefore, I think 00:39:36.670 --> 00:39:40.190 it's now a good sign. And I mean, there's also 00:39:40.190 --> 00:39:42.650 this saying that you always should act like counter 00:39:42.650 --> 00:39:45.590 -cyclic though, in that sense. So therefore, 00:39:46.090 --> 00:39:48.250 I think now it's a good time to found a company, 00:39:48.909 --> 00:39:53.170 but also to invest. And yeah, I mean, despite 00:39:53.170 --> 00:39:57.489 like these kind of tailing capital costs are 00:39:57.489 --> 00:40:00.070 harder, which I mentioned earlier, there are 00:40:00.070 --> 00:40:04.610 still lots of opportunities and also The last 00:40:04.610 --> 00:40:08.570 year, 2023, was actually really good for us. 00:40:09.610 --> 00:40:13.530 To be close, we're a second fund of 219 million 00:40:13.530 --> 00:40:18.650 and we invested in four really, really good companies. 00:40:22.969 --> 00:40:24.849 It's interesting because you mentioned the last 00:40:24.849 --> 00:40:27.050 financial crisis and I don't think most people, 00:40:27.210 --> 00:40:31.530 some people are aware of it. on a very regular 00:40:31.530 --> 00:40:34.389 basis were actually farming back then. Airbnb, 00:40:35.829 --> 00:40:38.230 Uber, Deliveroo, just all those companies were 00:40:38.230 --> 00:40:41.150 farming there. And people, they were having the 00:40:41.150 --> 00:40:43.030 same difficulties accessing capital that you 00:40:43.030 --> 00:40:45.929 do nowadays. So you're right, it's 100 % of the 00:40:45.929 --> 00:40:47.809 time to go is now, right? It's just starting 00:40:47.809 --> 00:40:50.929 out because you're much more likely to be successful 00:40:50.929 --> 00:40:53.889 than to wait for the good times to happen. So 00:40:53.889 --> 00:40:56.610 yeah, definitely, if people want to reach out 00:40:56.610 --> 00:40:59.699 to you, how can they do so? Yeah, please reach 00:40:59.699 --> 00:41:03.500 out via LinkedIn. Maybe you can link my name 00:41:03.500 --> 00:41:14.139 in the show notes. It's Natalie. And yeah, let 00:41:14.139 --> 00:41:19.920 me to hear from you guys and please send any 00:41:19.920 --> 00:41:24.400 text if you have them. I'm happy to have a look 00:41:24.400 --> 00:41:28.030 at them. That's it. Thank you so much for your 00:41:28.030 --> 00:41:30.849 time. It's been very insightful. Thank you. Thank 00:41:30.849 --> 00:41:33.289 you also. It was a pleasure to meet you. This 00:41:33.289 --> 00:41:36.010 podcast is also sponsored by startupnetworks 00:41:36.010 --> 00:41:39.610 .co .uk. Startup Networks, it's an online forum 00:41:39.610 --> 00:41:41.590 where you can find all the resources you need 00:41:41.590 --> 00:41:44.130 to run your startup, from grants to investors 00:41:44.130 --> 00:41:46.289 to tips and tricks on how to be successful in 00:41:46.289 --> 00:41:49.349 your startup. This podcast is sponsored by OpenExperts 00:41:49.349 --> 00:41:52.389 .com. OpenExperts is a place to go if you're 00:41:52.389 --> 00:41:54.190 looking to talk with top experts from around 00:41:54.190 --> 00:41:57.710 the world. That is open -expert .com