Standard. 'Ecosystem' #43
A weekly guide on tech news and early stage fundraising. Aiming to open access to the venture industry for less networked founders and junior VCs.
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Hello and welcome back to ‘Ecosystem’, issue 43!
In this newsletter, you will learn:
How are VC partners navigating parental leave?
Tips on adding value to every conversation/interaction (in VC and beyond!) - as shared by Meagan Loyst at #EcosystemGiants
The dos and don'ts of product-led growth
How and when to (not) raise venture capital?
Thank you for reading ‘Ecosystem’ for yet another week! It means a lot to me that you continuously choose this newsletter as your go-to resource on tech news and early-stage fundraising! If you want to see the project grow, you may support it further here.
See you next time💜
#EcosystemGiants
It was fantastic to hear from Meagan Loyst (VC, Lerer Hippeau) last week - her passion and drive to work towards increasing transparency in the VC industry and help more young people of diverse backgrounds get ahead is beyond inspiring. Few memorable takeaways from our chat:
Create your own opportunities
“Every opportunity that I've gotten in my life has either not existed, or I wasn't a fit for the role - everything has just been pure hustle, working super hard and being really creative. At LH, they didn't have a job opening at the time - I was reaching out proactively to see what I could be doing to be helpful, because I loved everything about the fund. At the end of the day, people want to hire people that they like that they trust.”
Reflect on each (work) experience
“I love my lists. After each (work) experience, what I would recommend people to do is to write down the pros and cons of the things you truly enjoy and the things you don't. For me, finding my way to VC was very much maximizing all the things that I liked about my previous experiences and minimizing the things that I didn't like so much (ie sitting behind a desk all day reading research reports!). You learn a bit about yourself and what you gravitate towards - and it helps in making informed decisions about your career.
Develop a specific expertise - and put yourself out there
“At General Atlantic, I would spend months doing very thematic work on spaces and companies (one of those areas is EdTech) - and at the very beginning, I started tweeting about the trends I was seeing, companies I was following. That was my first thread that blew up a little bit on Twitter. People still find me, come to my profile, see that thread, and probably think: ‘She knows EdTech really well’; and then they see my articles and it kind of all comes together really nicely. I was just very forward about putting my voice/thoughts out there (which can be kind of scary!). But I'd spent so much time in EdTech - and I felt I had a really good and interesting point of view, regardless of what the world thought.”
Building relationships and adding value
“In an interview with a famous, senior investor I got asked the question : ‘What are the three things that you bring to every conversation with a founder, that only you bring?’ I really had to think about that and I think about that on every call. Founders are going to be meeting with tons and tons of investors - how would you stand out? For me, oftentimes, it's related to competitive landscape such as putting companies on their radar that they might have never heard of before. Or giving them some type of product insight, because I've spent so much time in these specific verticals or it could be making interesting intros (for their team, or in adjacent spaces). Building trust, especially as young investor is truly knowing what you're talking about and adding value to conversations.”
You may find Meagan on Twitter or see Gen Z community for tech leaders here. Many thanks to FemGems, ParlayMe, Startups Magazine for supporting this session, which was hosted at 12 Hay Hill.
Who is the next #EcosystemGiants guest? He is the Co-Founder and Managing Partner at one of the leading PropTech VC funds, focused on the untapped innovation potential of the real estate industry in Europe and has been part of the start-up scene for almost two decades. Throughout his career, he has accompanied more than 100 transactions with companies from the seed round to the IPO - and has co-authored a book which has turned into a ‘VC Bible’ for founders and investors in the DACH region and beyond. Stay tuned for an email later in the week to find out who he is :)
Innovation Ecosystem Updates
Trending. As restrictions lift, rideshare players like Lyft are slowly re-emerging from the pandemic - but challenges to their gig work model globally remain (CNBC). Amid record quarterly profits, SoftBank triples down on solo strategy for Vision Fund 2 (from $10BN to $30BN) via Axios. An inside look into Top VC firm Accel’s scout program in Europe (Sifted). Former Shopify executives go onto advise, invest in or launch start-ups upon leaving the e-commerce giant (Techcrunch). Airbnb has not only redefined ‘travel’ stays but (semi) permanent accommodation options - 24% of bookings on the platform are 28 days or more (Yahoo Finance). Top Silicon Valley VC firm Andreessen Horowitz got a new General Partner (A16Z). Baseball star Alex Rodriguez teams up with Walmart's former e-commerce chief Marc Lore (who also founded Jet.com) to launch a $50M VC fund (own capital), making concentrated bets (taking up ownership of 40%+) on digital retail (CNBC). Former Amazon exec turned VC (at Bessemer Venture Partners) Jeff Blackburn is boomeranging right back to the tech giant(New York Post). Raising babies and funds is hard - how are VC partners navigating parental leave? (Sifted).
Plus: Two strong trends this week in early stage tech investment - the unfair advantage solo capitalists with an own media arm have (the ability to reach of 300K+ within a day of a deal announcement!) and the massive opportunity a large social media following could bring to founder (friends) fundraising (‘how to create your own YC demo day’).
Massive rounds. Lithuania’s only unicorn and Europe’s largest online consumer-to-consumer second-hand fashion platform Vinted raises $303M at a $4.5BN valuation, in a round led by EQT Growth (Reuters). Out of California, rapid diagnostic testing start-up Cue Health bags $235M to prep for a post-Covid world and spin point-of-care coronavirus tests into a broader model for multiple diseases and conditions (Fierce Biotech). Online learning platform MasterClass raises $225M in Series F funding to accelerate enterprise offering and expand internationally, more than tripping its valuation in ~a year to $2.75BN (CNBC). Munich-based final-mile fulfilment start-up parcelLab closes a $112M Series C funding round led by U.S. VC/PE firm Insight Partners (Techcrunch). London-based global fashion shopping platform Lyst raises $85M in a ‘pre-IPO’ round at a $700M valuation (Techcrunch). Berlin-based virtual events platform for the scientific community Morressier secures $18M in Series A funding to grow online conference features (Eu-Startups).
Acquisitions. Apple service provider Jamf acquires UK-based zero-trust security startup Wandera for $400M (Znet). Following a $200M Series D raise this March (at a $3.2BN valuation), Medical billing company Cedar buys healthcare startup Ooda for $425M, moving into the insurance market (Forbes). Twitter has stepped up its pace of acquisitions in recent months to fuel growth - the spree of the social media giant continues with the purchase of Scroll (sixth deal announced this year!), a subscription service that removes ads from participating news sites (The Verge). Online learning community for high school students Fiveable snaps up Hours, a virtual study platform built by a 16-year-old (Techcrunch).
Sustainability. 2020 was a record- year of funding in lab-grown meat companies, marking a sixfold growth in investment (The Guardian). Vegan food company Oatly Group is to go public this week, eyeing a $10BN+ valuation (Bloomberg). Home furnishing giant Ikea launches a Food Innovation Accelerator Program - and scouts for start-ups to collaborate with (key themes: circularity and alternative protein sources!) to achieve its goal of serving 50% plant-based foods by 2025 (Green Queen). Application close 19 May 2021.
Plus: Do not miss LBS annual Real Estate Conference 20-21 May to find out more about how the industry is re-adapting to a post-Covid world and don’t forget to join Shaper Impact Capital’s ‘SIC Impact Insights’ at 7pm CET on Thursday 20 May to find out all about investing in purpose-driven ventures.
Wins for women. Are women more ethical than men? A research by Professor Barbara Casu (Cass Business School) finds banks with more female directors faced lower and less-frequent fines for misconduct (saving those institutions ~$7.84M a year!) via (Harvard Business Review). 👏 Congrats to 22-year-old Paige Finn Doherty for launching Behind Genius Ventures, a new $1.6M Gen Z fund (which she largely raised through her Twitter following!) to back underrepresented founders (The San Diego Tribune). 👏 Arra Malek promoted to Principal at Craft Ventures. 👏 Are women CEOs held to a higher standard? Well done Whitney Wolfe Herd (Founder and CEO, Bumble) for your strength and for speaking up (WSJ).👏
“No one realises how hard it is to build a business. And how hard it is to be a woman building a business. This ‘build them up to break them down’ is a disgusting habit and anybody that is thinking about doing that to other women should stop. I cannot tell you how many young women have said to me ‘I don’t want to start a business anymore. I don’t want to get taken down. I don’t want to be cancelled. This cancellation of women for things men don’t even get looked at for is really wild. Candidly it’s wrong and people have no idea how hard it is. I’ve been under such a microscope, so much scrutiny.. The snooping around of looking for something at all times - this will paralyse a woman emotionally. And it’s really wrong.” - Whitney Wolfe Herd, Founder and CEO, Bumble
Funder
“Without designing their company for buying, many self-serve SaaS companies hit a growth ceiling as they saturate their early adopter audience. Some symptoms of hitting the ceiling include plateauing top-of-funnel, small pockets of adoption in companies (vs. consistent user activation and wall-to-wall expansion), continual churn between free/paid product tiers, and churn of the largest and fastest-growing customers churning to enterprise-class solutions.”
Sarah Guo (Partner, Greylock) discusses the limits of product-led growth, how to incorporate it in the GTM strategy, and some of the challenges of getting this exactly right
Founder/Operator
“Differences in take rates are primarily driven by three factors: (1) whether you can drive new demand, (2) how much convenience you provide the seller, and (3) the level of competition in the market. Take rate = Convenience + Demand - Competition.”
Angel investor and product expert Lenny Rachitsky summarises the most common patterns found analysing the take rates, commissions and charges of 40+ tech marketplaces, platforms and services
Twitter Highlight
Sam Ettelaie, Venture Capital Senior Investment Manager, British Business Bank
Start-up of the week
The review platform for D2C products and online brands
Thingtesting is a D2C review platform born from the question, ‘has anybody tested this?’. Started out as a side-project Instagram account with photos and honest bite-sized reviews of new products (founded by Backed VC alum, Jenny Gyllander); before spinning out into a VC-backed business, that aims to bring more transparency and structure to online shopping. The brands featured on the platform are highly curated (based on their product offering, story and differentiation point), with the ultimate goal : providing objective reviews of new products.
Tweet @thingtesting_ to share they were featured in ‘Ecosystem’!
Do reach out to me if working on a product advancing one or more of the United Nations Sustainable Development Goals.
Startup Go-to Resources
How to raise money from a VC? - a must-read article by A16Z's Scott Kupor on whether to raise venture capital; and if so how much?
Navigating the PMF journey - a mental framework as described by Bessemer Venture Partners' Adam Fisher
How investors use growth ideas to evaluate startups? A must-read resource by A16Z's Andrew Chen (that helped him land the role at the firm!)
The MVP framework - measuring and proving user retention
Fundraising 101 : what do early stage investors look for, what makes a business VC-backable and how to approach fundraising - tips from Reshma Sohoni (Co-Founder and Partner, Seedcamp)
The difference between a good and a great retention
Creating effective slide headlines for your deck - a guide by Hustle Fund Co-Founder, Eric Bahn
What is a pre-seed round and how to raise one?
Questions to ask yourself when stuck The Three Rules of Freemium by Christoph Janz (Co-Founder and Partner, Point Nine Capital)
50 Best Pitch Deck Examples from YC & 500 Startups Thank you for reading another ‘Ecosystem’ newsletter! What feedback do you have for me (likes/dislikes)? I would greatly appreciate if you share this with contacts (founders, tech operators & investors) who may find the content helpful🖤 Connect with me on Twitter