Investors: How to really invest in people?
I’ve learned a new way of looking at startups and VC investments from a chance encounter with Alex Dunsdon, a serial entrepreneur and a VC. This was an eye-opening experience for me and it’s time for me to share it with other founders / investors.
The turning point
I didn’t imagine that a serendipitous Linkedin connection with a person named Alex, will lead to him hosting on our podcast a few months later. I couldn’t imagine that this single conversation would change the way I thought of myself, the stratup eco-system and even VC investments.
I could never have guessed that this event would change how I approach our fundraising process at SAPIA — but it did. Here is what transpired…
But first who is Alex?
Alex is an LP at Potential Ventures, a GP at SAATCHiNVEST the VC arm of Saatchi& Saatchi (which he actually founded a few years ago), an adviser at RedBrain, a seed investor in 20+ startups such as (CityMapper, Ometria, Farewill & many more).
Alex has a unique way of thinking — that in my mind will revolutionise the investment scene, that is really centred around the people.
But before we get to that… Here is a true story about meeting another investor that reflects in my mind the status quo of the VC world (unfortunately).
My last pitch
[This conversation is edited for brevity so you get the picture]
The meeting starts — we are on Zoom.
VC: “So, tell us about your background but before you do let us tell you about our fund and previous successes.”
Me: “[listening] Great to know you. Before we start I have a question for you- how do you invest? what are you looking at? what’s important for you?”
VC: “Team first, then market, then solution.”
Me: “When you look into the team what exactly are you looking for?”
VC: “It’s all about the founders, are they experienced yet coachable? Do they fit the market? [edited] We want to know who they are because it’s all about the people, especially early stage — it’s about the people”.
Me: “Sounds great [excited] — let me tell you about us, the research we did about the market, how we reached those insights and why we are building this solution”
The conversation continues…. and the real deal unfolds =>
VC: “So tell us about the solution. What are you building?”
Me: “Wait don’t you want to hear about the team? how we think? how we came to the conclusions about this market, where it goes and what it needs?”
VC: “[edited] sure but first tell me your solution, KPI, competitors, then we can talk about your team and thinking process later. also where are you in your fundraising journey”.
In reality it was wrapped in a bit more politeness but that was the bottom line.
Is there a better way? Yes there is.
Enter Alex 👇
Investing in a way that no other VC dares to follow
Everyone in the VC industry looks for the top 1% of the top 20% of category X… but is that how you identify an iconic company to invest in?
Alex first locates the right people and builds the teams, funding, tools, networks and even the business around them. Everyone says it’s all about the people, but Alex actually and wholeheartedly gives a true meaning to this sometimes void axiom.
“We invest first in the team” every VC proudly declares! But what is the team?What does it mean?? Are you looking at their credentials? Their CV? Their networks? Their experience? Their dynamics? or their way of thinking? Their values & world-views?
Most VCs will not bother to study the team for real. They will check the necessary boxes and move on to talk about the solution & business model.
But business models evolve. Solutions change and pivot. Teams stay (hopefully).
So how do you locate and/or build the right team? How do you find the right people?
In this post (link) I share our take on winning teams, how to know whether you are founder-material, and how to improve as a founder.
