FUND / GROUP
NUMBER OF PORTFOLIO COMPANIES
Ai, Robotics, Industry 4.0
North America, South-East Asia, Emerging Markets
HOW AND WHY DID YOU GET STARTED IN PRIVATE INVESTING?
Having grown up up amidst the winner-takes-all environment in the newly capitalist Russia of the 1990’s, I became fascinated by the world of high finance was fortunate to have experienced working in its various aspects. As an investment banker, I quickly realized that on the sell-side, a lot of work goes into the table and there is little scope for individuality. Moving on to a private equity firm, I had my first meaningful experience of interacting with founders of multinational enterprises and helping them solve the challenges they faced. That was far more interesting because I had more responsibility, built my working relationships within a smaller team and was able to see the results of my actions on portfolio companies’ performance. The origin stories told to me by founders intrigued me – how much greener is the grass on the other side? What’s it like to be an entrepreneur? I founded a company importing exotic wines into British hotels, restaurants, and bars and did everything from scratch – logistics, contract negotiations, and the selection of the wine portfolio. The business was going well, yet Brexit put a spanner in the works, as a lot of the clients were uncertain how to do business in the new reality. After that, I moved back to the investment sphere, yet this time knowingly chose to focus on venture capital - earlier stages with a more technological focus. In this field, I am more able to work closely with founders who are yet to make it and use my prior experiences to generate a greater impact on their international growth and fundraising efforts.
WHAT IS THE SINGLE MOST IMPORTANT THING YOU VALUE IN AN INVESTMENT OPPORTUNITY?
I place great importance on the founding team’s solid understanding of target customers and how exactly their own product effectively service the client’s needs and wants to an extent the incumbent competitors don’t. After all, why would I, as an investor seek to back an innovation if founders are unable to effectively sell it? The founding team must also understand the limitations of their current product and have an appropriate timeline of future features, fundraising rounds and expansion into different markets and verticals.
WHAT ARE THE BEST INNOVATION THEMES THAT YOU SEE IN THE MARKET TODAY?
There are many exciting themes - Robotics, Future of Work, Quantum Computing, Cybersecurity, Smart Cities… the list goes on. In the developed markets, the economies become increasingly digital, meaning that more routine tasks can be done remotely and/or by machines and there is greater connectivity between various household devices and the world around them. The advancements in machine learning and big data make it increasingly possible for actionable insights from one industry to be applicable to other industries and markets, increasing potential synergy, cost savings, and revenues of individual and corporate clients alike. In the developing countries, innovations are more about impact – areas which are already taken for granted elsewhere – clean water, electricity, and financial services for the underbanked. As the world is becoming increasingly globalized, there is an opportunity for firms in developing economies who can learn from the mistakes of businesses in richer countries and avoid the same hoops they had to jump through. This would lead to the development of national leaders in markets which are currently small, but rapidly growing, provided that the startups understand the risks of first-mover advantage and make the necessary adjustments for the different consumer preferences, habits, and their purchasing power.
BEYOND ECONOMIC RETURN, WHAT KIND OF IMPACT DO YOU HOPE TO MAKE WITH YOUR PORTFOLIO?
In our investment philosophy, we seek to back those companies who make the modern world safer and more interconnected despite the geographical and political borders that still linger. I personally hope that my portfolio companies would help to build the world which inspires the next generation of dreamers.
WHAT ARE THE MOST PRESSING CHALLENGES OR PAIN POINTS IN MANAGING YOUR DAY-TO-DAY PRIVATE INVESTMENT ACTIVITY?
One of the pressing challenges is automating the updates from the top of the startup funnel from different sources – conferences, media articles, startup databases, network etc. There are already too many to adequately keep track of, yet new ones constantly come into existence. This process takes a long time and is very monotonous, yet if unexperienced people do it, it could result in some potentially interesting leads being rejected before being properly considered by the team. To streamline this process, a tool to objectively rank those sources in order of effectiveness for the deal flow of a specific fund (e.g., ranking which sources have produced more leads at each subsequent specific stage; e.g., initial consideration, due-diligence, investment committee, investment etc.), including the reasons why they did/didn’t pass on to the next stage of consideration would be useful.
WHAT IS THE HARDEST INVESTMENT LESSON YOU’VE LEARNED AND/OR THE BIGGEST INVESTMENT MISTAKE YOU’VE MADE?
I think that one of the key lessons I’ve learnt as a VC is to trust my gut feeling more. When a deal is competitive, the timeframe for deciding whether to invest is very short, making it impossible to tick all the usual boxes. Venture capital is about taking risks, so if an entrepreneur can make a risk by leaving a cushioned corporate career for a chance to change the world, so should an investor. After all, you may not be able to accurately describe it, but gut feeling is not just luck. Instead, it comes from analyzing hundreds of different investment opportunities and highlighting those aspects which you feel are most necessary for the startup to be potentially successful.
WHAT ARE YOUR FAVORITE INDUSTRY INFORMATION SOURCES AND/OR SERVICES?
Attending tech conferences is great for PR, reading media articles could provide insights about the emergence of specific technologies and browsing startup databases may be useful in expanding the top of the funnel investment opportunities. Yet they share a common problem – once something is public knowledge, it’s no longer as undervalued an opportunity. Nothing in the investment field trumps your own network – other investors, entrepreneurs, and technology leaders that you have grown to know and trust over the years. Through continuous interaction, you know which areas these people are most knowledgeable about, how they think, and which factors they prioritize when judging whether to recommend a specific investment opportunity.
WHAT’S YOUR FAVORITE NON-BUSINESS INTEREST OR HOBBY?
Since I was young, I loved ancient history, which drove me in my spare time to engage in archeological pursuits. For me, the sense of discovery that comes from being the first to examine an object that was left by people countless generations ago is almost akin to the eureka moment experienced by startup founders transforming the way we live in the modern era. To satisfy my sense of wanderlust, I went on several archeological expeditions around the world – from jungles of the Amazon to the arid deserts of Egypt. From each of my travels, I bring back a memento, be it a boomerang of Australian bushmen or a mask of an African tribe. Overlooking such a collection helps me to understand better how people around the world think and arrive at breakthrough innovations.
PLEASE LEAVE US A BOOK RECOMMENDATION (BUSINESS OR OTHERWISE).
When I was starting out in the VC industry, I enjoyed reading the book called “Venture Deals – Be Smarter than your Lawyer and Venture Capitalist” by Brad Feld and Jason Mendelson. The book intrigued me because it looks at the fundraising and deal negotiation processes between the entrepreneur and the investor from both sides of the table, explaining their thinking processes and the term sheet clauses that they would normally prioritize at various startup stages.