Early-Stage Pitching: Q&A with Cambridge Angels and Playfair Capital
On September 10th, we’re partnering with Cambridge Angels and Playfair Capital to bring virtual Office Hours to the Cambridge ecosystem. Dubbed “Silicon Fen”, Cambridge is emerging as one of the top tech hubs in the UK and Europe, thanks to its world-class education, research and innovation.
To help you prepare, Cambridge Angels Deal Sorcer Emmi Nicholl, and Playfair Capital investor Henrik Wetter Sanchez share their thoughts on how best to prep for the 20-minute office hour format, and what they look for in pre-seed and seed-stage founders at-large.
We’re keen to meet all pre-seed entrepreneurs with ambitious, venture scale ideas connected to the Cambridge ecosystem. Students, professionals, residents, graduates, alumni, post-docs, professors, and drop-outs are all welcome!
How do you determine whether a founder's idea is a good idea?
Emmi: It’s almost always about Team, Technology and Traction. We want to know that you have a great team that has the entrepreneurial skillset, academic background and/or history of delivering similar businesses. We seek almost exclusively defensible tech, usually in the B2B space, and we need to know that there is proof of market need.
Henrik: For us, a great idea is inextricably linked to the founders themselves. Given the number of people in a world which is increasingly borderless, it is hard to build a big business off of a ‘lightbulb’ idea. You need the right team working on their idea for the right reasons. Fundamentally, this boils down to a clear and pressing problem with an equally clear solution.
How can early-stage founders best prepare for pitching angels and/or pre-seed VC?
Emmi: Do research on the investors that you’re seeing and make sure you’re pitching the most relevant information for your audience.
Henrik: At the first meeting, cover the detail behind the problem and the solution. We love to come away with an understanding of the status quo in the market, where the greatest value lies along the problem chain and a clear vision on how this company is building a product to solve it. Combining this with a practical short-term plan to add some substance to the big picture is even better!
What is a common mistake that early-stage founders who are pitching make?
Emmi: Not leaving enough time for questions. The pitch is crucial but investors like to get to know founders through conversation and feedback.
Henrik: Trying to say it all and getting lost in the noise. We understand that you’re at the start of your journey, with everything still to do and lots of exciting plans, but the best founders are concise while pointing towards further detail that they are in control of and can go into, but don’t need to unless asked. Creating this feeling of mastering your market and product inspires a great deal of confidence as an investor.
What do you look for in early-stage founders/founding teams?
Emmi: We look for teams with great entrepreneurial potential as shown by your prior business, academic or entrepreneurial ventures. We also look at your team’s passion for and commitment to the new business idea, and your ability to inspire confidence among future stakeholders, including employees, potential customers, and investors. As we will be working together as partners, your team’s credibility is essential. In addition, your team must be open to and comfortable with receiving input provided by angel investors.
Henrik: Passion for the burning problem they’re solving, for the team they’re working with, and for the company they’ll be building for the next ten years. Relevant domain experience, particularly on the technical side, is important but can come in many guises. In-depth market and customer research alongside a strong MVP can be as powerful as twenty years as a top tier consultant.
How important is traction when a founder is pre-launch and potentially pre-product? What advice would you give to founders navigating this?
Henrik: This is a difficult question that needs to be answered case by case. However, we would suggest finding an alternative measure of easy product-market fit, if revenue isn’t an option. You need to help the investor assess your business, no matter how early it is; be creative!
Emmi: We invest in solutions that address major problems for significantly large target markets (i.e. a market size of £100m+). Your company must demonstrate a strategy to claim significant market share or revenue. This doesn’t necessarily mean revenue but there must be some evidence of product-market fit to address this market. Pre-product would be too early-stage for us. For that, we look to the brilliant network of incubators, accelerators, grant schemes and coaching facilities to help companies get to MVP.
What do you want to see from a founder in a 20-minute meeting like the upcoming office hours?
Emmi: Tell us the basic. This includes
- your technology,
- your IP,
- why it is better than the competition,
- traction so far / planned route to market,
- business model,
- how you have funded the project until now,
- how much you are raising now and at what valuation,
- use of funds, and
- what you would like to get from Cambridge Angels (besides funding!).
Henrik: There are 3 main things.
- Know your asks. Go into any meeting with a clear agenda, regardless of the length. For a short 20minute office hours sessions, I would usually recommend a max 5-minute intro to you and the business, followed by 10 minutes of general discussion and 5 minutes of specific questions. Of course, this is totally up to you though!
- Be prepared. This means knowing your pitch and questions inside out. Be snappy and to the point, save the detail for a follow-up. Research your investor and their firm so you know their areas of expertise.
- Get the follow-up. Make sure you end the meeting with a follow-up. This might be clarity that this isn’t an opportunity the investor will pursue, it might be a longer meeting with the same investor or a member of their team, or it might be a connection to someone else in their network. If you don’t ask you don’t get.
Why are you particularly excited about the Cambridge ecosystem?
Henrik: Cambridge is a brilliant melting pot of deeply technical people with a long history of innovation. We firmly believe any company could be born out of Cambridge and are looking forward to helping many exceptional founders do so over the years to come.
Cambridge Angels is a leading UK business angel network with international connections actively mentoring and investing in innovative entrepreneurial teams and their ideas, to achieve returns and help realise their full potential. The group has a strong ethos of backing merit and supporting entrepreneurship. Members, most of whom are successful entrepreneurs, invest in a wide range of start-up and scale-up businesses with a particular focus on technology, internet, software, hardware, and tools and technologies supporting healthcare.
Founded in 2013, Playfair Capital is an angel-led, pre-seed and seed-stage VC investing in entrepreneurs building technology companies that rethink the way we live and work. We write £100k - £500k cheques, investing globally and sector agnostically but with a focus on Deep Tech (software) and B2B in the UK and France. We have an angel-led approach: flexible, hands-on, long-termist. Our key value-add beyond the standard VC sell of network is: scaling experience, sales, marketing, hiring and refining/building financial models.