As part of Disrupt 2020 we wanted to look at the contrasting positions of both later-stage and early investing in Europe. Who better to unload this subject than two extremely experienced operators in these fields? After a career at Spotify and then as a VC at Atomico, Sophia Bendz
has rapidly gotten a reputation in Europe as a keen early-stage investor. She just recently left Atomico to pursue her seed-stage and early enthusiasm with Cherry Ventures. Bendz is a prolific angel investor, with a total of more than 44 deals in the last nine years. Her angel financial investments consist of AidenAI, Tictail, Joints Academy, Omnius, LifeX, Eastnine, Handbook, Headvig, Basic Feast and Sana Labs. She is known for being a champion of the femtech area, and her angel financial investments in that space include Clue, Grace Health, Daye, O School and Boost Thyroid. Carolina Brochado, the previous Atomico partner and most recently a partner at SoftBank Vision Fund’s London office, recently signed up with EQT Ventures to assist introduce EQT’s Development fund, which is placed in between endeavors and private equity. Brochado led investments in a number of promising companies at Atomico, consisting of logistics business OnTruck, health tech company Hinge Health and dining establishment supply chain app Rekki. After developing that these 2 understood each other while at Atomico, I asked Bendz why she headed back into the seed-stage arena.”I’m a qualified marketeer and writer by heart … What makes me excited is brand-new markets chances, individuals, culture, groups. With that, in mix with my angel investing, I believe I’m better suited to be in the earlier stages of investing. When I was investing before signing up with Atomico, I said to myself, I want to gain from the very best, I want to see how it’s done, how you structure the procedure and how you think about the larger financial investments.”Brochado states the European”feline is out of the bag,”as it were: When I initially moved to Europe in 2012 and first signed up with Atomico, after having been at a really small start-up, there was still a huge gap in financing and Europe versus the U.S. I think you know the European trick is no longer a secret, and you have extraordinary funds being started at that early-stage seed and Series A, and due to the fact that I was here in 2012, I have actually seen the remarkable pipeline of growth companies that are turning up the curve, how the momentum of those companies
is speeding up and how the market cap of those businesses are growing
. And so I just ended up being incredibly thrilled about helping those businesses scale … I just now felt like bridging that gap in between was actually interesting. One of the seasonal subjects that show up time and time once again is whether creators ought to choose VC partners who have previously been operators, versus those with a financing background. “Looking back, my years at Spotify, we had fantastic financiers, however there were very few of them that had the experience of scaling a huge company,”Bendz stated.”So, I’m happy to offer [a start-up] more than simply the check in a way that I would have wanted I had a sounding board when I was 25 and tackling that difficulty at Spotify.
“Brochado concurred:” Having operators in the room is just is an extraordinary present I think to a fund and at specific levels, having individuals that comprehend you understand different forms of funding
and various structures can also be incredibly practical to founders who may not necessarily have that background. I think that the funds that do it finest have that diversity. ” Bendz is enthusiastic about buying female creators and femtech:” It’s such a massive organization opportunity that is totally untapped. We’ve seen it many times when you have a female investment partner
[ that] the pipeline opens up and you get more offer circulation from female founders … So I think we have a lot of work to do. I think it’s certainly improved a lot in the last number of years however inadequate … That is one of the drivers for why I put my money where my mouth is and purchase lifting the founders, but also since there are extremely intriguing business
chances … There are so many opportunities and products or services that we will see being established. When we have a more equivalent society, and more females, both constructing their own business, coding and also investing … I can’t wait to see what that world will appear like.” Brochado’s view is that”even beyond founders … the best managers today are putting a lot of focus on this and I believe what’s interesting is, I think we’re past the point where you need to describe to people why variety matters.”Exists a post-Series A chasm? Bendz believes:”We have more big funds in Europe [now] We have a really solid ground here in Europe of A, B and C investors.” Brochado stated:”It’s definitely improving. You don’t hear as numerous founders state that to do my Series B or my Series C I need to relocate to the Valley as you used to. There’s a lot of room still for growth financiers in Europe. I think Series B is the hardest round really because, at
seed or Series A, you can raise on really early traction or the quality of the management team. At Series B the cost goes up but the danger does not always go down as much. Therefore I believe that’s where you really need investors who are sector or thematic focused, who can include conviction and likewise some
understanding around the company to actually move that company forward.” Did they both see European entrepreneurs still making silly errors, or has
the ecosystem mastered? Brochado believes ten years ago it was difficult for European founders as a lot of the talent to scale companies was still in the U.S.”What you’ve seen is a great deal of big companies grow up in Europe, a great deal of individuals come back from the U.S., and so I believe that swimming pool of talent now is larger, which is really valuable. I don’t think it’s yet at the scale of where the U.S. is. It offers us, you know as financiers, a terrific window of chance to help get some of that skill for our portfolio business.” The effect of COVID-19 Bendz thinks we will “see a much slower spring, but … I believe it has been overall a good exercise for some companies, and I have not seen a slower offer flow. I
‘ve actually done more angel offers this spring than I typically do … Some organizations have certainly accelerated their
entire organization concept since of COVID. Investments are being made even though we haven’t met the creators. We’re able to do whatever remotely so I think the system is type of adjusting.”Brochado’s view is that at the growth phase”there’s been a flight to quality. So in fact, the really great companies or the companies that are seeing fantastic tailwinds or companies that will still be category-leading when [ have] seen a great deal of interest. It’s been an extremely busy summer season, which generally it isn’t, particularly at the growth phase … I think a great deal of money is
still in the system, and has actually flown into technology. Therefore if you look at how tech in the public markets has actually performed it’s performed incredibly well. Which consists of European public business and within tech.”See the complete panel below. Article curated by RJ Shara from Source. RJ Shara is a Bay Area Radio Host (Radio Jockey) who talks about the startup ecosystem – entrepreneurs, investments, policies and more on her show The Silicon Dreams. The show streams on Radio Zindagi 1170AM on Mondays from 3.30 PM to 4 PM.