WEBVTT 00:00:05.057 --> 00:00:12.737 Welcome to StartupRed.io, your podcast and YouTube blog covering the German 00:00:12.737 --> 00:00:17.657 startup scene with news, interviews and live events. 00:00:19.617 --> 00:00:25.957 Hello and welcome everybody to StartupRed.io. Today we're diving into the world 00:00:25.957 --> 00:00:31.077 of venture capital with Identity VC. Joining us is Till Klein. Hi, Irene. 00:00:32.197 --> 00:00:35.917 Hi, Joe. How are you today? Doing good, thank you. 00:00:36.097 --> 00:00:41.817 You are the founder and managing partner of Identity VC, a VC firm redefining 00:00:41.817 --> 00:00:44.097 investment in early-stage startups. 00:00:44.397 --> 00:00:51.217 In 60 seconds, Till, can you share what sparked the idea for Identity VC and 00:00:51.217 --> 00:00:53.977 what problem you're most passionate about solving? 00:00:54.437 --> 00:00:59.897 Sure, happy to. Yeah, IdentityVC invests in LGBTQ-led companies. 00:01:00.317 --> 00:01:07.677 And the thesis behind that is that innovation thrives when we break from the norm. 00:01:08.117 --> 00:01:14.357 And for the LGBTQ community, breaking the norm is part of our DNA. 00:01:15.037 --> 00:01:20.577 So our thesis is that LGBTQ founders are born to disrupt. 00:01:20.577 --> 00:01:28.517 And this is a great untapped opportunity as an investor, full stop. 00:01:28.737 --> 00:01:30.717 That's why we do it and what we do. 00:01:33.397 --> 00:01:41.217 For our listeners, what's the biggest challenge you think early startups face when securing funding? 00:01:41.437 --> 00:01:43.437 Let us know in the comments down here. 00:01:45.217 --> 00:01:50.097 Talking a little bit about your journey, your origin, your story, your vision. 00:01:52.497 --> 00:01:57.397 Before we got into the recording, we talked, you already had a successful career 00:01:57.397 --> 00:02:03.797 before founding IdentityVC, working, for example, with BCG. 00:02:04.137 --> 00:02:08.197 What was the catalyst that led you to launch this venture fund? 00:02:08.757 --> 00:02:12.517 Yeah, it's kind of, you need to go back to, so I started, actually, 00:02:12.637 --> 00:02:16.417 I wanted to work for a bank. When I was at university, I wanted to work for a bank. 00:02:17.057 --> 00:02:22.357 But I finished university in 2022. There was no jobs available in banks. 00:02:22.557 --> 00:02:24.597 So that's how I ended up with BCG. 00:02:24.837 --> 00:02:32.057 I never regretted it. And I had a good time. And I stayed there for more than 12 years. 00:02:33.497 --> 00:02:36.717 But I've always focused on financial services. 00:02:36.957 --> 00:02:41.937 And at some point when left and right, the fintech wave started, 00:02:41.937 --> 00:02:48.737 I saw my clients doing nothing and got a bit frustrated. And so that triggered 00:02:48.737 --> 00:02:50.937 me to start my own company, Fintech company. 00:02:51.595 --> 00:02:57.055 And so that's also how I met my now co-founder Jochen. 00:02:57.335 --> 00:03:00.055 He is a family office investor out of Berlin. 00:03:00.375 --> 00:03:07.015 And we both came across an organization called GANGELS in the U.S. 00:03:07.435 --> 00:03:14.715 That's initially gay investors who invested into diverse founders. 00:03:15.095 --> 00:03:20.115 And I came across them when looking for funding. 00:03:21.015 --> 00:03:24.835 Jochen, as an investor, as a co-investor, he did a lot of co-investments with 00:03:24.835 --> 00:03:28.275 them. And we asked ourselves kind of, why is there nothing similar in Europe? 00:03:29.415 --> 00:03:33.375 And so that was back five, seven years. 00:03:35.335 --> 00:03:39.335 And then kind of we didn't find a reason why not. 00:03:39.575 --> 00:03:43.735 The only reason is probably nobody did it. So then we were waiting for a while 00:03:43.735 --> 00:03:49.575 if somebody does it and nobody did it. And after I closed down my startup, 00:03:49.935 --> 00:03:52.835 we then said kind of, let's give it a try. 00:03:53.055 --> 00:03:58.675 Now I've got some time. And obviously, it's on us to start that idea in Europe. 00:04:01.535 --> 00:04:04.755 That already kind of gets my next question. 00:04:06.175 --> 00:04:14.355 Which gaps you saw? It's especially the LBGGQ founders that you are looking 00:04:14.355 --> 00:04:17.235 for from our discussion before. 00:04:17.235 --> 00:04:24.375 My understanding is that at least one of the members needs to identify as LBGGQ, 00:04:24.515 --> 00:04:28.655 but everything else is just a normal startup. 00:04:28.815 --> 00:04:31.695 You're also looking at the normal business projects there and stuff. 00:04:32.501 --> 00:04:39.561 Absolutely, absolutely. So actually, there was no fun focusing on the LGBTQ 00:04:39.561 --> 00:04:43.221 or queer community. It's sometimes easier than the acronyms. 00:04:44.521 --> 00:04:52.881 But the opportunity is huge. So we estimate that 18% of the startups do have an LGBTQ co-folder. 00:04:53.981 --> 00:04:58.401 And this is even growing, given the fact that in younger generations, 00:04:58.441 --> 00:05:00.401 more people are identifying as queer. 00:05:00.661 --> 00:05:04.921 So this is a huge untapped opportunity as a VC. 00:05:05.301 --> 00:05:12.981 And if you compare that, that's more or less the same size as the fintech market. 00:05:13.141 --> 00:05:16.021 So it's a huge, huge opportunity. 00:05:18.221 --> 00:05:24.481 You came from BCG, then you tried fintech, and then you started a VC fund. 00:05:24.661 --> 00:05:30.601 I think that's quite an interesting journey you have behind you. 00:05:30.721 --> 00:05:36.361 But what was the biggest challenge in building a VC firm that stands out in 00:05:36.361 --> 00:05:38.761 a very competitive industry? 00:05:38.761 --> 00:05:47.341 We do get, I would say, at least once a week mailings from some new fund that 00:05:47.341 --> 00:05:51.041 was either raised or completely new VC firm launched. 00:05:51.201 --> 00:05:55.801 So it gets more and more competitive, which, by the way, is for Europe a very 00:05:55.801 --> 00:06:01.101 good thing, because there's a lot more startups that need funding than there are VCs right now. 00:06:01.521 --> 00:06:08.481 But what we say kind of stood out as like the one, two or three top challenges you face there. 00:06:10.461 --> 00:06:16.781 Yeah, let's say, kind of, I wouldn't have started if the opportunity wasn't so obvious. 00:06:17.361 --> 00:06:23.981 Because honestly, starting a generalist fund in Europe at the moment, I wouldn't do that. 00:06:25.001 --> 00:06:29.821 I do not recommend it. But here was really an opportunity that was very obvious 00:06:29.821 --> 00:06:31.901 and nobody has taken it yet. 00:06:32.421 --> 00:06:34.881 On the other hand. 00:06:36.489 --> 00:06:42.249 We also were a bit naive when it came to the fundraising environment and coming 00:06:42.249 --> 00:06:47.369 from 2021, 2022, where capital was available easily. 00:06:48.069 --> 00:06:53.269 And so we were over optimistic at the end. 00:06:53.909 --> 00:06:58.309 So fundraising was just a bigger effort than we thought. 00:06:59.549 --> 00:07:05.289 At the end, if I look left and right and how many funds I saw who started earlier 00:07:05.289 --> 00:07:12.429 than we and who are now behind us or who have given up. 00:07:12.789 --> 00:07:17.289 So I'm pretty satisfied with what we've achieved so far. 00:07:17.529 --> 00:07:24.749 But that definitely was in that environment to raise a fund is a tough cookie 00:07:24.749 --> 00:07:27.689 coming all with what comes with a fund. 00:07:27.689 --> 00:07:34.029 So it's kind of you need to build the organization, you need to build the network, and all that comes. 00:07:34.169 --> 00:07:42.109 And all that without having any income, that's also kind of – that's a big structural problem for VC. 00:07:42.389 --> 00:07:50.489 And that prevents a lot of, let's say, uncommon people to get into VCs because 00:07:50.489 --> 00:07:52.809 at the end, you need to be able to afford it. 00:07:52.809 --> 00:08:00.309 And because fundraising takes two years and there's during those two years, 00:08:00.469 --> 00:08:01.969 there's no income, but a lot of costs. 00:08:02.589 --> 00:08:11.769 So that is kind of so Jochen and I, we are a bit older and so we could afford it. 00:08:11.889 --> 00:08:17.209 But that's a big challenge, particularly for younger VCs. 00:08:17.489 --> 00:08:23.249 And that prevents probably quite interesting VCs. I would love to see in Europe. 00:08:26.509 --> 00:08:34.749 Before we get to my next question, do you have any idea how one could encourage such VCs? 00:08:35.509 --> 00:08:42.929 Oh, pretty sure. So honestly, European VC is primarily public funding. 00:08:43.169 --> 00:08:48.889 So it depends on the vertical, but overall across all, it's over 30% is public 00:08:48.889 --> 00:08:52.209 funding. So that always we need to keep in mind. 00:08:52.949 --> 00:08:58.629 And so the question is kind of behind the public funding, what you want to achieve. 00:08:59.029 --> 00:09:06.469 And if public funding would be kind of focused on that and would drive new, 00:09:07.890 --> 00:09:14.470 for unconventional VCs to come up, that would work because they could put their money there. 00:09:14.670 --> 00:09:16.950 They don't do that, to be very honest. 00:09:17.230 --> 00:09:21.490 They prefer to throw their money after those who are already big. 00:09:22.830 --> 00:09:26.510 But that's a political decision, a wrong decision from my perspective. 00:09:26.890 --> 00:09:34.970 But that could change. How that could work, you see, it's about defense tech. 00:09:35.450 --> 00:09:40.490 So defense tech was not big. And then there was a lot of public money turned 00:09:40.490 --> 00:09:46.470 towards that direction, and that immediately shifted the whole industry in that direction. 00:09:46.670 --> 00:09:51.910 So they do have, they could play, given the fact that they are so strong, play an important role. 00:09:53.550 --> 00:10:01.150 Unfortunately, when it comes to new VCs and new ideas, they're not really open. 00:10:01.310 --> 00:10:06.630 They prefer to sit in the board of the established VCs or on the advisory board. 00:10:07.690 --> 00:10:13.430 When you've been talking about starting Identity VC, you talked about you would 00:10:13.430 --> 00:10:17.110 not start a general VC fund right now in Europe. 00:10:17.510 --> 00:10:23.030 That got me curious. What kind of VC fund would you start right now except for Identity VC? 00:10:25.510 --> 00:10:28.070 What kind of VC fund I would start? 00:10:30.250 --> 00:10:38.030 I haven't thought about it. Honestly, these kinds of things are very opportunity-driven. 00:10:38.330 --> 00:10:42.210 And honestly, if there would not have been the opportunity and there would not 00:10:42.210 --> 00:10:46.630 have been Jochen to do that together, I would not have done it, probably. 00:10:47.050 --> 00:10:52.610 So it's kind of have the idea, the opportunity, and the team. 00:10:53.070 --> 00:10:55.270 And honestly... 00:10:56.331 --> 00:11:02.711 And there is none. So I don't think I need to start a second FAT at the moment. 00:11:04.031 --> 00:11:08.531 So I'm still busy with the first one. I do believe so. 00:11:09.171 --> 00:11:13.911 Let's talk about a little bit of the industry market landscape, the competitive edge. 00:11:14.111 --> 00:11:20.211 You are described as investing in startups with a strong market fit and unique identity. 00:11:20.831 --> 00:11:25.411 What defines a strong identity in a startup? 00:11:26.771 --> 00:11:31.191 A strong why, a strong mission. Why are you doing this? 00:11:32.431 --> 00:11:37.631 What's the mission? And founders who really know they want to change something, 00:11:37.871 --> 00:11:41.811 they want to build something, except from getting rich, which is not, 00:11:41.931 --> 00:11:47.951 from my perspective, a very strong mission, at least kind of in terms of pushing a startup through. 00:11:50.071 --> 00:11:53.471 We've been talking about your main investment focus, but there are also, 00:11:53.591 --> 00:11:57.751 of course, different industry, different trends. Think about like all the things 00:11:57.751 --> 00:12:01.391 we've seen in the past, e-commerce, fintech, quick delivery, 00:12:01.851 --> 00:12:04.151 drones, and so on and so forth. 00:12:04.671 --> 00:12:09.151 How does IdentityVC position itself in this evolving landscape? 00:12:09.411 --> 00:12:16.411 Are you looking on a deal-by-deal basis? Or are you already seeing what could 00:12:16.411 --> 00:12:20.371 be the next trend, what could be the next interesting wave of startups? 00:12:21.357 --> 00:12:29.177 Lots of buzzwords, which is kind of, yeah, very kind of that characterizes the VC industry. 00:12:29.397 --> 00:12:32.917 Kind of there's lots of trends and fashions and then everybody is chasing that. 00:12:33.217 --> 00:12:38.357 So typically the most VCs are not very good in risk taking and taking new opportunities, 00:12:38.357 --> 00:12:41.137 which doesn't make any sense because that's a job of VC. 00:12:41.337 --> 00:12:44.817 But I was I've never understood. 00:12:45.157 --> 00:12:49.277 So you want to go for the stuff others don't look at. And honestly, 00:12:49.397 --> 00:12:54.017 if you look at the history of VC, that's also how big VC firms grew, 00:12:54.177 --> 00:12:56.617 because they took a decision that was against the market. 00:12:57.257 --> 00:13:06.197 But so to answer your question, what we do is we are generalists and decide deal by deal. 00:13:07.177 --> 00:13:10.877 So we are open for plenty of opportunities. 00:13:12.617 --> 00:13:16.997 And so that also comes with a challenge in terms of you need to have the expertise, 00:13:16.997 --> 00:13:19.197 you need to have a great network. 00:13:19.477 --> 00:13:24.817 But as we have that kind of very narrow focus on kind of what type of founders 00:13:24.817 --> 00:13:26.357 we're looking at, we decided, 00:13:26.577 --> 00:13:30.777 okay, we need to be a bit broader when it comes to industries and that allows 00:13:30.777 --> 00:13:37.337 us to see very, very interesting stuff, particularly for a guy who has a banking 00:13:37.337 --> 00:13:39.897 background, which is like very boring, 00:13:40.137 --> 00:13:44.117 very kind of always the same, a very simple industry. 00:13:44.497 --> 00:13:52.997 And now I have the chance to look at quite exciting startups who have really 00:13:52.997 --> 00:13:57.317 impact and can make a big difference to people. 00:13:58.337 --> 00:14:04.597 You guys are investing in early stage startups. What would you say is, 00:14:04.717 --> 00:14:06.737 especially from the side of 00:14:06.737 --> 00:14:10.997 the founders, the biggest misconception about early stage VC investments? 00:14:13.940 --> 00:14:19.540 And one thing that jumps to my mind is when they ask me to sign an NDA, 00:14:20.080 --> 00:14:26.080 which is like, and that shows there's no lake of ideas. And an idea is worth nothing. 00:14:26.440 --> 00:14:31.420 It's all about the execution. I've seen so many ideas that never happened. 00:14:31.860 --> 00:14:37.020 And this is quite often you see that from unexperienced founders. 00:14:37.240 --> 00:14:41.940 They come and say, can you sign an idea? and this is honestly, 00:14:42.280 --> 00:14:45.200 you're just talking about a brainchild and, 00:14:45.820 --> 00:14:51.360 there's nothing if you are not able to execute on that, it's worth nothing so 00:14:51.360 --> 00:14:54.080 this doesn't make any sense. 00:14:54.340 --> 00:15:00.520 So they learned that very fast because no VC would ever sign an NDA at that 00:15:00.520 --> 00:15:05.840 stage but it always gives me a smile when they come up and say, can you sign an NDA? 00:15:06.100 --> 00:15:10.720 It's like, no I was the same when I started my startup and you were an unexperienced founder. 00:15:11.920 --> 00:15:13.700 I did exactly the same. 00:15:15.140 --> 00:15:21.280 I see. So we're all learning. Hopefully a lot of future founders listen to this 00:15:21.280 --> 00:15:24.400 episode and already learn from the mistakes of others. 00:15:26.280 --> 00:15:30.020 I want you to close your eyes and imagine something. 00:15:30.300 --> 00:15:34.060 Imagine Identity VC has backed the next generation of unicorns. 00:15:34.060 --> 00:15:37.920 What key industry shifts would have made this possible? 00:15:39.000 --> 00:15:43.320 I would say it's clearly AI at the moment. It's kind of not industry-specific 00:15:43.320 --> 00:15:45.000 that will impact across industry. 00:15:45.160 --> 00:15:51.800 That's really like having even a broader impact than Internet had 30 years ago 00:15:51.800 --> 00:15:54.960 or 25 years ago. So, no, 30 years. 00:15:56.660 --> 00:15:58.420 So, shit. 00:16:01.400 --> 00:16:08.740 That reminds me how old I am. But this will have such an impact on so many industries, 00:16:08.980 --> 00:16:12.600 starting from financial industry, health, but production. 00:16:13.000 --> 00:16:16.180 This will be very fundamental, and we are just at the beginning. 00:16:18.020 --> 00:16:24.720 Actually, about being older, just a friend of my wife, she has a girlfriend, 00:16:25.020 --> 00:16:26.340 and the kids are teenagers. 00:16:26.620 --> 00:16:30.660 And I told them, I'm older than Google. And they said, no way. And I said, yes way. 00:16:33.180 --> 00:16:38.520 That is really old Jill we will be back for our audience with your investment 00:16:38.520 --> 00:16:41.780 thesis and startup selection deep dive after a short ad break. 00:16:51.353 --> 00:16:55.373 Hey guys, welcome back to the interview with Till from Identity VC. 00:16:55.393 --> 00:16:59.753 We are now talking about investment thesis and startup selection. 00:17:01.553 --> 00:17:09.893 Till, what are the top three criteria that determine whether Identity VC invests in a startup? 00:17:10.013 --> 00:17:14.753 We already heard it's not the idea, it's the execution, but what else? 00:17:16.913 --> 00:17:22.773 It's pretty clear. There needs to be a real problem. You need to solve a problem for somebody. 00:17:23.253 --> 00:17:26.113 Secondly, there needs to be a market and a big enough market. 00:17:26.713 --> 00:17:32.053 If there's no demand or nobody is paying for a solution for the problem or it 00:17:32.053 --> 00:17:33.353 is too small, it doesn't work. 00:17:33.933 --> 00:17:40.933 And thirdly, it needs a great team that executes it on it and solves the problem. 00:17:41.773 --> 00:17:47.173 That is great. It seems like you have seen my next question because beyond the 00:17:47.173 --> 00:17:50.633 numbers And be honest, in early stage VC investment, 00:17:50.913 --> 00:17:57.573 the numbers are not that important here because the real revenues will come in the future. 00:17:58.293 --> 00:18:03.733 What are some intangible qualities you look for in a founding team? 00:18:06.853 --> 00:18:10.313 That's what I mentioned before. It's kind of mission driven. 00:18:10.593 --> 00:18:14.513 I think that's very, very, what's the motivation? Why somebody started the startup? 00:18:14.513 --> 00:18:18.953 So I think that's a very, very interesting question to understand the startup. 00:18:19.253 --> 00:18:23.893 And why are you so crazy to go through all the pain? 00:18:24.353 --> 00:18:28.333 So you need to have a very strong motivation. And second is risk taking. 00:18:29.226 --> 00:18:33.906 You need to be willing and able to take crazy risk. 00:18:34.566 --> 00:18:38.446 And everybody around you will advise you not to take that risk. 00:18:38.586 --> 00:18:41.386 But then you are exactly on the right way. 00:18:41.546 --> 00:18:45.666 If everybody is disagreeing with you, go ahead. You are on the right way. 00:18:46.046 --> 00:18:54.226 And that combined with a hustler mentality, at the end, it's like there's nothing to delegate. 00:18:54.226 --> 00:19:02.246 Hate this, just get, roll your sleeves up and go create results and create them fast. 00:19:02.746 --> 00:19:12.106 By the way, mission driven. That made me smile because being rich quickly is not a mission here. 00:19:14.566 --> 00:19:18.726 It is. Honestly, that drives some founders. Yes, it does. 00:19:20.186 --> 00:19:23.866 This is not a company I would invest in. 00:19:24.226 --> 00:19:28.926 Yeah, so the getting rich is all good. And honestly, we're not good in Europe. 00:19:28.926 --> 00:19:32.606 So that's kind of for all the pain and all the risk you take, 00:19:32.746 --> 00:19:35.926 there needs to be a proper reward. 00:19:36.726 --> 00:19:42.066 And that's a big problem in Europe that the reward, particularly not only for 00:19:42.066 --> 00:19:47.986 the founder, but kind of for kind of the management team, is not enough. 00:19:51.106 --> 00:19:56.406 But that's not enough to build a great company and to solve a real problem. 00:19:57.046 --> 00:20:04.466 I was smiling because I found when you have somebody in the team who wants to 00:20:04.466 --> 00:20:09.666 get rich quick, he or she takes the earliest possible exit, 00:20:11.426 --> 00:20:16.386 during semi-retirement or something that is not the people who really want to 00:20:16.386 --> 00:20:18.526 build a unicorn to the end. Um, 00:20:19.324 --> 00:20:24.704 How do you balance investing in visionary founders versus proven traction? 00:20:25.064 --> 00:20:27.064 I don't balance. 100% vision. 00:20:27.784 --> 00:20:32.744 Okay. What role? We talked about this before. 00:20:33.364 --> 00:20:37.064 You and your team, obviously, like I do, use AI. 00:20:37.484 --> 00:20:42.444 And what role does AI play in your investment decision-making process? 00:20:42.704 --> 00:20:45.964 Do you leverage AI to analyze deal flow or market trends? 00:20:46.884 --> 00:20:49.964 It would be a lie if we don't. Can we do more? 00:20:50.124 --> 00:20:55.044 Honestly, we can do more, more systematically, more do kind of the routine task. 00:20:56.444 --> 00:21:02.884 So kind of what, honestly, what in previous times an intern did or so, 00:21:03.044 --> 00:21:07.764 that's all stuff that you can do or an assistant that you can do with AI. 00:21:07.764 --> 00:21:14.884 At the end, AI is not yet there that it can take an investment decision from 00:21:14.884 --> 00:21:20.084 my perspective because AI can do a lot, but it's not intelligent yet. 00:21:20.544 --> 00:21:26.484 And I always have the discussion with the team to say kind of this is all good market research. 00:21:26.684 --> 00:21:31.704 But honestly, to nail that to the point and draw a conclusion, 00:21:31.964 --> 00:21:36.024 a business and really an investment decision, this is missing. 00:21:36.024 --> 00:21:40.144 And this is what you cannot yet get out of AI. 00:21:40.504 --> 00:21:42.304 That's where the human factor comes in. 00:21:42.864 --> 00:21:46.784 I was smiling when you talked about the intern, because if you can describe 00:21:46.784 --> 00:21:52.064 a to-do in a way that an intern would get it, you can also delegate it to an AI. 00:21:53.370 --> 00:21:56.990 That's a very, very good point. 00:21:57.210 --> 00:22:02.610 And honestly, I see that and I've experienced that so often that you get something 00:22:02.610 --> 00:22:05.650 and you think, what the fuck is that? 00:22:05.810 --> 00:22:11.110 And then you just have to hold your own nose and think, shit, 00:22:11.310 --> 00:22:14.770 this is what the briefing I gave. I gave no briefing. 00:22:15.030 --> 00:22:19.790 So bullshit in, bullshit out. And that's exactly what's happening in much faster pace. 00:22:19.790 --> 00:22:26.650 So you get more faster feedback, but that also happens if you don't give proper 00:22:26.650 --> 00:22:30.150 briefing to your team and the more junior they are, 00:22:30.350 --> 00:22:35.090 you get non-optimal results. 00:22:36.110 --> 00:22:41.690 I see. Let's talk a little bit about business model and growth strategy here. 00:22:42.450 --> 00:22:48.330 VC is evolving. How do you see traditional VC models changing over the next five years? 00:22:49.070 --> 00:22:52.470 As we already talked, AI will have an impact. 00:22:52.710 --> 00:22:58.590 I do believe there's some overvaluation in AI, but we're just at the start of 00:22:58.590 --> 00:23:00.450 learning how to really apply it. 00:23:00.570 --> 00:23:03.430 And the development is already in the future here. 00:23:03.590 --> 00:23:06.810 So how do you see the traditional VC model changing? 00:23:07.130 --> 00:23:12.050 First of all, I would challenge your point that VC is evolving. 00:23:12.050 --> 00:23:17.190 This is a very conservative industry, which has not much involved over time 00:23:17.190 --> 00:23:19.390 and has not much changed. 00:23:19.630 --> 00:23:24.530 So it's dominated by white old men and public institutions. 00:23:24.930 --> 00:23:31.670 And they are typically not very the change drivers. And so is the industry. 00:23:33.330 --> 00:23:37.710 The only shifts we've seen is kind of what I mentioned a bit earlier is kind 00:23:37.710 --> 00:23:41.530 of when there was a shift by public funders. Kind of defense tech is a good example. 00:23:42.050 --> 00:23:46.370 So they shifted their money. That was like a big boom in one direction. 00:23:46.610 --> 00:23:50.370 And everybody is running behind them or following them. 00:23:52.130 --> 00:23:58.610 But at the end, if you look at things like women in BC, this is ridiculous what 00:23:58.610 --> 00:24:00.410 happened the last 10 years. 00:24:00.410 --> 00:24:14.110 If you look at top ranks, the share of women in VC has grown from 2011 to 2021 from 9% to 12.5%. 00:24:15.147 --> 00:24:19.307 This is fucking ridiculous. If you project that in the future, 00:24:19.307 --> 00:24:23.987 it would take another 107 years to get to parity. 00:24:24.887 --> 00:24:28.127 So this fucking industry is not changing at all. 00:24:28.267 --> 00:24:33.567 And this is all lip service and kind of we get more diverse. No, you're fucking not. 00:24:34.707 --> 00:24:42.887 So you are at a lower double digit number of female and not talking about other 00:24:42.887 --> 00:24:48.807 diversity dimensions. But there's, for obvious reasons, more data available. 00:24:49.207 --> 00:24:56.867 And that's also true to other stuff. So this industry is ready for disruption as well. 00:24:57.347 --> 00:25:01.647 And when you talk about public investors, one should keep in mind that you're 00:25:01.647 --> 00:25:06.067 not only talking about the legal entities here involved in Europe, 00:25:06.067 --> 00:25:11.087 But also, you should keep in mind that a lot of the big VC funds in the U.S. 00:25:11.147 --> 00:25:16.927 Are basically backed by something like the Teachers Retirement Fund of California, 00:25:17.527 --> 00:25:20.847 Ontario Pension Fund of Public Employees, or something like that. 00:25:20.967 --> 00:25:23.807 You should always keep that in mind. 00:25:24.747 --> 00:25:29.307 It's important, but that's a political issue, that in the U.S. 00:25:29.467 --> 00:25:35.587 Kind of pension money, and that's the biggest pool of wealth, flows also into VC. 00:25:36.067 --> 00:25:41.087 And that's a big problem of Europe that policymakers have not understood that 00:25:41.087 --> 00:25:43.967 this is the lever. The only who has understood that is Macron. 00:25:44.927 --> 00:25:48.187 Can debate about him, but that's what he did very right. 00:25:48.387 --> 00:25:54.587 He forced kind of the insurers to put more money into BC and kind of look at 00:25:54.587 --> 00:25:59.447 the numbers that in the meantime, Paris has overtaken Berlin. 00:25:59.987 --> 00:26:02.667 That's one of the reasons why. Mm-hmm. 00:26:03.633 --> 00:26:10.493 So what's your take? I mean, as a traditional VC, what's your take on alternative 00:26:10.493 --> 00:26:15.713 funding models like revenue-based financing or, for example, crowd investing? 00:26:16.253 --> 00:26:22.353 We put a lot of hope in crowd investing, but right now it's more a proof of 00:26:22.353 --> 00:26:25.593 interest by potential community, by potential audience. 00:26:26.373 --> 00:26:30.153 Like a first step to raise venture capital. I've seen it so far. 00:26:31.053 --> 00:26:33.273 Yeah, it's good to have some that never took off. 00:26:35.293 --> 00:26:41.333 Obviously they're not the solution because what we need is funding below VC 00:26:41.333 --> 00:26:48.253 level so we see a lot of great founders with great cases but they're not a VC 00:26:48.253 --> 00:26:52.853 case they might become a company that's worth 80, 00:26:52.973 --> 00:26:59.153 100 million or 100 million which is fucking successful which is great but it 00:26:59.153 --> 00:27:02.133 doesn't work for the math of a VC fund, 00:27:02.953 --> 00:27:06.833 This is just kind of you need to really chase for the unicorns. 00:27:06.933 --> 00:27:08.353 Otherwise, the math don't work. 00:27:09.093 --> 00:27:15.993 So what we do need and what is not yet available is really kind of VC-like money 00:27:15.993 --> 00:27:22.093 for kind of this level below VC case. 00:27:22.233 --> 00:27:30.533 These 50 to 100 million companies and there's a big gap. and both models you've 00:27:30.533 --> 00:27:32.233 mentioned don't solve that. 00:27:36.053 --> 00:27:39.053 You're a former consultant, so I can already guess the answer, 00:27:39.193 --> 00:27:43.233 but how do you support your portfolio companies beyond just capital? 00:27:43.633 --> 00:27:45.213 You mean I throw slides on them? 00:27:50.053 --> 00:27:55.093 Yeah, first of all, we can, yeah, I would say as every other top VC, 00:27:55.093 --> 00:28:02.073 We can help them with funding, with operating support, with strategic advice. 00:28:02.533 --> 00:28:06.913 So Jochen brings an incredible experience in fundraising. 00:28:07.453 --> 00:28:11.313 So he himself has invested over $100 million into VC. 00:28:11.653 --> 00:28:18.053 At the same time, he is an LP in over 20 funds in the U.S. and in the EU. 00:28:18.273 --> 00:28:21.793 So he has top connections and something that... 00:28:22.358 --> 00:28:30.138 It's not so common also into the family office world, which is very difficult to get in for founders. 00:28:30.638 --> 00:28:35.278 Mari has a very good operating experience. So she was a growth operator, 00:28:35.458 --> 00:28:40.258 scaled a company over a double digit in ARR. 00:28:40.558 --> 00:28:47.318 You mentioned I have a consulting background and was a founder. 00:28:47.318 --> 00:28:53.198 But that's all I would say you could expect from a VC and other VCs have as well. 00:28:53.458 --> 00:28:58.998 So what we do have and others don't have is the LGBTQ community. 00:28:59.998 --> 00:29:07.958 And so our intention is to help our founders to make the community their unfair advantage. 00:29:08.338 --> 00:29:12.738 And this is a super interesting community because it's huge. 00:29:12.898 --> 00:29:15.978 It's across borders. It's across hierarchies. 00:29:16.618 --> 00:29:22.058 And it's cross-functional silos. So this is a great, great network, 00:29:22.058 --> 00:29:29.118 which most owners have not yet properly leveraged and to get access to experts, 00:29:29.278 --> 00:29:31.478 to mentors, to corporates. 00:29:31.658 --> 00:29:36.398 We have in end of February, we have an event in Amsterdam. I'm super curious how that will work, 00:29:36.798 --> 00:29:42.158 kind of connecting LGBTQ founders with companies, with the Pride networks and 00:29:42.158 --> 00:29:46.258 the companies, And which is great because typically a company is a black box 00:29:46.258 --> 00:29:51.018 for a founder and very difficult to get into this huge black box. 00:29:51.198 --> 00:29:56.818 But the pride network in a company could give you a great network already in 00:29:56.818 --> 00:30:03.018 the company that might not exactly the right person who is in charge of what you need. 00:30:03.138 --> 00:30:08.318 But they're very open to help you, to guide you through the organization. 00:30:08.318 --> 00:30:11.058 And this is a huge opportunity. 00:30:11.438 --> 00:30:18.918 And our intention is and our mission is also to open that up for our portfolio 00:30:18.918 --> 00:30:20.058 companies, but also beyond. 00:30:21.821 --> 00:30:28.581 I see. To our listeners, if you were a startup founder, what would be the biggest 00:30:28.581 --> 00:30:31.561 challenge in raising VC funding? Let us know. 00:30:32.641 --> 00:30:40.001 To you, what do you think is the biggest challenge of startups they face when 00:30:40.001 --> 00:30:43.081 scaling, meaning they have the first investment, 00:30:43.261 --> 00:30:48.081 they have the first product, and then they want to go big, they want to scale. 00:30:48.081 --> 00:30:52.561 What is usually the biggest challenge they face and how do you help them? 00:30:52.741 --> 00:30:56.041 It's a very different thing if you're an early stage startup and you are kind 00:30:56.041 --> 00:30:59.441 of a bunch of friends, a team, and you do something together. 00:30:59.681 --> 00:31:04.441 And it's super easy because you just need to turn around and you speak to another department. 00:31:05.081 --> 00:31:08.261 Building an organization, recruiting, building an organization, 00:31:08.641 --> 00:31:13.621 building a culture, that's a big challenge and that's a complete different animal. 00:31:14.001 --> 00:31:18.521 And that's something you need to be able to. you also need to like. 00:31:18.781 --> 00:31:23.841 So for example, I know that's not my kind of thing. That's consulting doesn't work like that. 00:31:24.181 --> 00:31:27.801 Also, VC doesn't work like that. 00:31:27.861 --> 00:31:32.501 So I like to have high speed, small teams where everybody kind of is in charge. 00:31:32.821 --> 00:31:38.341 But to really scale, you need to build structures. You need to build processes. 00:31:38.581 --> 00:31:44.461 You need to build a culture that makes these structures work as you want that. 00:31:45.170 --> 00:31:51.890 So that's a big challenge. What we can do is we can be a sparring partner. 00:31:52.370 --> 00:31:57.350 That's the thing. And this is anyway kind of how I see also value creation to founders. 00:31:57.750 --> 00:32:02.290 It's they need to come to us. I don't want to obstruct help. 00:32:02.350 --> 00:32:07.610 So they need to come to us and happy to give my opinion. 00:32:07.790 --> 00:32:10.310 I've seen a lot of large organizations. 00:32:11.230 --> 00:32:17.770 Jochen has seen a lot of startups also growing exactly. and he has exited large startups. 00:32:18.070 --> 00:32:25.890 So he has seen what challenge these are. And I would say it's worthwhile talking to us about it. 00:32:27.670 --> 00:32:34.070 I see. Let us go a little bit into fundraising and financial sustainability, 00:32:34.070 --> 00:32:35.510 especially for the startups. 00:32:35.710 --> 00:32:38.530 You've worked closely with early stage startups. 00:32:38.770 --> 00:32:44.270 What's a common mistake founders make when pitching a VC? 00:32:45.190 --> 00:32:52.490 So it's quite often, but sometimes you have to be too creative when it comes to their pitch deck. 00:32:52.870 --> 00:32:57.250 It's like the pitch deck is something that you want to look for. 00:32:57.350 --> 00:33:01.170 You look for a certain set of information to do your first screening. 00:33:01.730 --> 00:33:05.910 Don't be creative. Just have the information I'm looking for. 00:33:05.970 --> 00:33:10.390 If it takes me too long to look for the information and if I'm not able to understand 00:33:10.390 --> 00:33:13.430 the product, the market, it's super simple in a few minutes. 00:33:14.950 --> 00:33:17.890 Then this is not a good sign. 00:33:18.070 --> 00:33:23.470 That does not mean it needs to be professional and also to get across kind of 00:33:23.470 --> 00:33:28.210 your branding and the shape that's kind of I'm able to do that. 00:33:28.390 --> 00:33:34.210 But sometimes too tactical, too creative decks, just do your homework. 00:33:34.890 --> 00:33:41.110 And that's because the first step is very technical in VC. 00:33:41.490 --> 00:33:44.430 You see, we see 10, 20 decks per week. 00:33:44.570 --> 00:33:49.730 So, screening it, you look for certain information, you take a decision, 00:33:50.010 --> 00:33:54.650 do we want to talk to that team or don't we want to talk to that team? 00:33:55.310 --> 00:34:00.270 If it takes us too long to figure that out, it's a default no. 00:34:02.190 --> 00:34:09.170 I see. You've been talking basically about keeping your first pitch deck boring, 00:34:09.350 --> 00:34:15.810 but what was the stand-up pitch you've received that really struck you? So far, none. 00:34:17.990 --> 00:34:24.570 I've seen good pitches, yeah, but there was not the – I'm still waiting for 00:34:24.570 --> 00:34:27.070 the real moonshot pitch that blows me away. 00:34:27.230 --> 00:34:32.830 They were all, like, better or worse, but there was none that's, 00:34:33.050 --> 00:34:37.490 like, completely thrown me away. 00:34:38.090 --> 00:34:41.970 Great. We'll be back with team and leadership after a short ad break. 00:34:49.960 --> 00:34:54.980 Hey, guys. Thanks for staying on. I'm talking with Till in, I think, 00:34:55.260 --> 00:34:57.620 more than 35 minutes already here in the recording. 00:34:58.360 --> 00:35:03.180 We are talking about now, Till from IdentityVC, I have to say, 00:35:03.320 --> 00:35:06.100 and we're talking now about team and leadership. 00:35:06.900 --> 00:35:09.700 I would be curious what one leadership 00:35:09.700 --> 00:35:14.920 lesson is you learned while running IdentityVC, not BCT, not FinTech. 00:35:17.300 --> 00:35:20.260 I i'm probably the the wrong person 00:35:20.260 --> 00:35:23.460 to ask i'm a really bad leader so 00:35:23.460 --> 00:35:29.080 if you you know this this linkedin things kind of good and bad leadership and 00:35:29.080 --> 00:35:35.600 then there's this bad leadership that's all me so i would say um i i'm not a 00:35:35.600 --> 00:35:42.120 role model here and i'm also too too old to to change uh fundamental things here. 00:35:42.320 --> 00:35:48.900 You always learn, but I would not say that my leadership style is a role model. 00:35:49.680 --> 00:35:52.940 I see. So then quickly shift into the culture. 00:35:53.340 --> 00:35:58.660 What would you say are core values that define the culture at your company? 00:35:58.840 --> 00:36:03.960 What sticks out is to be a super entrepreneurial, and that's kind of also what aligns Jochen and me. 00:36:04.040 --> 00:36:08.860 We are very different in terms of how we work, But we are super aligned on the 00:36:08.860 --> 00:36:12.400 mission, but also on the values, what we accept. 00:36:12.600 --> 00:36:16.320 And part of that is entrepreneurial. Do new opportunities. 00:36:16.720 --> 00:36:21.500 So I'm a big fan of don't ask for permission, ask for forgiveness, 00:36:21.820 --> 00:36:25.060 just do it. Only result count. 00:36:25.660 --> 00:36:29.520 And what I often come across in that industry is that they tell, 00:36:29.780 --> 00:36:31.200 yeah, but others do it like that. 00:36:31.580 --> 00:36:37.960 I don't care about how the bullshit others do. That's not an excuse not to do 00:36:37.960 --> 00:36:39.220 it better or to do it right. 00:36:39.560 --> 00:36:44.320 And I hope that's also a bit of the culture we have at Identity VC. 00:36:45.300 --> 00:36:50.360 We not just, and that's what you see quite often in VC, just copy the bullshit 00:36:50.360 --> 00:36:53.260 that the whole industry does. We do things differently. 00:36:53.939 --> 00:36:57.479 Yeah, I see this in the news, of course, always the trends. 00:36:57.639 --> 00:37:02.759 Yeah, you have like three, four big investment in one area within a month because 00:37:02.759 --> 00:37:04.139 they heard, hey, they do it. 00:37:04.519 --> 00:37:07.519 Yeah, we also had a startup pitching. Let's do also that. 00:37:09.279 --> 00:37:12.759 We've been talking before about the leadership and the team. 00:37:12.939 --> 00:37:18.799 And how do you assess whether a founding team is resilient enough to navigate 00:37:18.799 --> 00:37:19.959 the startup challenges? 00:37:21.519 --> 00:37:28.379 It's a very good example for what we just discussed, because that's what we do very differently. 00:37:28.719 --> 00:37:33.959 We do BCG McKinsey-style case interviews with the team. 00:37:34.299 --> 00:37:37.659 So once we've done all our homework, so we looked at the market, 00:37:37.839 --> 00:37:42.319 we've gone through all the Excel sheets and talked to the founders quite often about the company. 00:37:42.539 --> 00:37:47.599 Then we invite the team to us. They come to Berlin. Then, first of all, 00:37:47.659 --> 00:37:49.719 we have a dinner together, not 00:37:49.719 --> 00:37:53.579 to talk about the company, just to meet the team. What are the hobbies? 00:37:54.699 --> 00:38:00.639 What's the background? To meet the person behind, because at the end you invest in the person. 00:38:01.499 --> 00:38:05.519 And secondly, the next day we do interviews and case interviews. 00:38:05.839 --> 00:38:09.199 And this is nothing you can prepare for. That's really kind of real. 00:38:09.399 --> 00:38:16.419 We take real life examples, put them in front of the founders and see how they would solve it. 00:38:16.559 --> 00:38:23.119 And what we want to get out of that here is kind of how ready they are to take risk. 00:38:23.699 --> 00:38:28.859 Do they have a bias for speed and for results? All the capabilities we spoke 00:38:28.859 --> 00:38:32.019 earlier about to figure that out. 00:38:32.019 --> 00:38:36.679 And that works super well because founders stop, 00:38:36.899 --> 00:38:41.559 try to sell their company because they just kind of, you confront them with 00:38:41.559 --> 00:38:47.279 a question they will come across anyway in the future and see how they react. 00:38:47.579 --> 00:38:53.419 And this is turned out to be a fantastic way how to evaluate founders. 00:38:53.679 --> 00:38:59.699 So this is something I took from my BCG time with me and brought it to BC. 00:39:00.299 --> 00:39:05.279 Interestingly, I haven't seen any other VC who does it, although it's very obvious. 00:39:07.039 --> 00:39:11.779 Let's talk a little bit about regulatory and societal impact. 00:39:12.799 --> 00:39:18.479 Do you see regulatory trends affecting VC investment strategies in the coming years? 00:39:20.019 --> 00:39:26.839 Regulatory one, very much so, of course. There's a lot. But I would say kind 00:39:26.839 --> 00:39:31.899 of it's more political, even though kind of one level up, because we are at a turning point. 00:39:32.879 --> 00:39:37.699 Trump has terminated kind of the social contract between nations. 00:39:38.819 --> 00:39:44.739 So if you think based on the Swiss philosopher Jean-Jacques Rousseau, 00:39:44.899 --> 00:39:49.739 his idea of having a social contract that... 00:39:51.725 --> 00:39:55.945 People agree on rules to gain more freedom. 00:39:57.425 --> 00:40:00.805 And that's kind of how society works. 00:40:01.025 --> 00:40:02.505 That's how a state works. And 00:40:02.505 --> 00:40:06.765 since World War II, we had that also on an international level, kind of. 00:40:06.905 --> 00:40:12.645 You agree on common rules, and that gives everybody, all nations, 00:40:12.685 --> 00:40:14.765 more freedom. That is changing. 00:40:15.365 --> 00:40:18.865 Trump is somebody who said, I don't accept the rules anymore. 00:40:18.965 --> 00:40:26.205 So he stopped playing by the rule. And immediately, we are back to what Thomas 00:40:26.205 --> 00:40:31.145 Hobbes described as man is a wolf to other men. 00:40:31.505 --> 00:40:37.565 And so, I don't know if that translates to German, but the car is getting reshuffled here. 00:40:37.825 --> 00:40:45.345 And that will have huge impact on many industries, on the society, 00:40:45.345 --> 00:40:47.965 and with that also on the VC industry. 00:40:47.965 --> 00:40:53.405 I do believe it will also have an indirect impact on the European startup scene 00:40:53.405 --> 00:40:58.905 made before the VCs from the US directly investing in European startups, 00:40:58.905 --> 00:41:02.765 as well as the LPs investing in European-based funds. 00:41:03.845 --> 00:41:11.105 Absolutely. Absolutely. Because you see that will reshuffle what was common 00:41:11.105 --> 00:41:16.185 practice for a while and it will stop trends and reverse trends. 00:41:16.185 --> 00:41:20.805 And so I don't know if we get to a new level of rules, 00:41:21.085 --> 00:41:30.045 but first of all, there is somebody who just breaks the common practice, 00:41:30.045 --> 00:41:34.885 and that will definitely have a huge impact. 00:41:35.225 --> 00:41:40.905 And I don't know what the impact is, because let's see, and that also depends 00:41:40.905 --> 00:41:44.665 very much on how the European Union and Europe reacts to that. 00:41:46.385 --> 00:41:49.885 And I think that's very hard to predict at the moment. 00:41:50.565 --> 00:41:56.005 I do believe it's also important to see he's breaking the rules. 00:41:56.205 --> 00:42:00.445 If he can do it, other leaders will also try to do it. And then they'll figure 00:42:00.445 --> 00:42:02.385 out a degree to which they can do. 00:42:02.525 --> 00:42:05.785 And that at one point hopefully may establish some new rules, 00:42:06.145 --> 00:42:09.065 maybe even some better rules. Yeah, exactly. 00:42:09.745 --> 00:42:14.925 Yeah, exactly. Kind of, honestly, in general, it's not bad kind of to shake 00:42:14.925 --> 00:42:16.445 up a bit and to disrupt a bit. 00:42:16.605 --> 00:42:25.185 But kind of, if you give out fundamental rules, all others don't feel bound to the rules anymore. 00:42:25.970 --> 00:42:31.770 Um, and, uh, so this is kind of, you're leaving an equilibrium and you need 00:42:31.770 --> 00:42:35.830 to find a new equilibrium and, uh, that could be very, very painful. 00:42:35.850 --> 00:42:42.170 Uh, the path to that, I guess, or there will be one, if it's better or not, let's see, let's hope. 00:42:42.710 --> 00:42:47.510 Um, and the key question is how long will it take to, to get to that, uh, equilibrium? 00:42:48.230 --> 00:42:52.830 Yes. And it doesn't have to be optimal for everybody else. Everybody knows who 00:42:52.830 --> 00:43:02.210 knows a junk cash equilibrium that basically doesn't have to be optimal for either side. 00:43:02.390 --> 00:43:08.590 But getting off our soapbox here again, going back to VC investment, 00:43:08.870 --> 00:43:13.470 what industries do you think are the most in need of venture capital support 00:43:13.470 --> 00:43:15.390 but are often overlooked? 00:43:16.370 --> 00:43:23.170 Typically, what I was referring to before, VC has a hurt mentality. 00:43:23.610 --> 00:43:27.050 So they're all moving in one direction or the other direction. 00:43:27.290 --> 00:43:30.910 And typically, this is overemphasizing one thing or the other. 00:43:31.550 --> 00:43:34.850 We're all in consumer. No, they don't like consumer anymore. 00:43:35.010 --> 00:43:43.170 They are all in B2B SaaS, which is also bullshit. So because there is opportunity 00:43:43.170 --> 00:43:46.730 or interesting opportunities in all industries. 00:43:47.470 --> 00:43:54.150 But there's industries I think they're super interesting and I don't see them as I would expect it. 00:43:54.250 --> 00:43:57.310 It's, for example, assistive technology. 00:43:57.630 --> 00:44:02.250 So technology that helps disabled people. 00:44:02.250 --> 00:44:08.530 Because in my mind that would be kind of if kind of you have kind of a disadvantage, 00:44:08.970 --> 00:44:14.830 wouldn't it be great if you have technology that kind of jumps in and kind of 00:44:14.830 --> 00:44:19.990 replaces the disadvantage so that you are at par again? 00:44:20.230 --> 00:44:26.810 And probably it has to do with the market and how it's paid for that, 00:44:26.850 --> 00:44:33.890 but that could be a great opportunity. and a great impact for people. 00:44:34.790 --> 00:44:43.130 And I also guess, though, great economically, also interesting one because it would solve. 00:44:44.380 --> 00:44:49.720 A big challenge and an unsolved problem. Talking about problems here, 00:44:49.940 --> 00:44:55.400 I'm sure you encountered a lot of them in the past and you learned some lessons from this as well. 00:44:55.640 --> 00:45:00.260 I'm talking about the lessons for future entrepreneurs here. 00:45:01.060 --> 00:45:06.620 You know, the typical question is what piece of advice you wish you had received 00:45:06.620 --> 00:45:08.800 before starting Identity VC? 00:45:08.980 --> 00:45:12.980 I remember from the start of our interview, like almost 40 minutes ago, 00:45:12.980 --> 00:45:19.800 that you've been talking how long it takes to raise funding. Yeah. 00:45:20.680 --> 00:45:26.060 One thing is like, forget about institutional investors as an emerging manager. 00:45:26.580 --> 00:45:32.440 We've wasted some time on the institutionals before I learned, forget about them. 00:45:32.580 --> 00:45:37.780 They're not committing to emerging managers. Very, very rare cases. 00:45:38.260 --> 00:45:45.640 You need to raise your first or second fund. you raise on high-network individuals and family offices. 00:45:49.240 --> 00:45:52.500 That's known, and others have the same experience. 00:45:53.580 --> 00:45:59.280 It would have been good if I would have known that before. Then that would have saved us some time. 00:46:00.900 --> 00:46:08.340 I see, I see. Talking about a common misconception of founders about raising 00:46:08.340 --> 00:46:10.620 venture capital, for me, 00:46:11.080 --> 00:46:16.340 In the beginning, it is that every VC invests in every company. 00:46:16.660 --> 00:46:21.260 There are certain focus groups like yours. There are certain industries. 00:46:21.700 --> 00:46:27.560 Plus, there are also stages like early stage, late stage, pre-IPO, and so on and so forth. 00:46:28.920 --> 00:46:34.780 By the way, guys, if any of these terms didn't tell you anything and you're 00:46:34.780 --> 00:46:40.600 about to raise venture capital, maybe you should talk to JetGPT here or do your homework. 00:46:41.740 --> 00:46:45.620 Any other misconception that strike you? 00:46:46.200 --> 00:46:50.240 First of all, adding to the homework before you contact the VC, 00:46:50.580 --> 00:46:52.820 go to the webpage and check what they do. 00:46:53.280 --> 00:47:00.440 Yeah, so sometimes it's like crazy that people do not do the three-second check, 00:47:01.280 --> 00:47:05.220 and what do they do, what do they invest in, and everybody has it on the website, 00:47:05.260 --> 00:47:06.420 and then they contact you. 00:47:06.500 --> 00:47:09.980 That's a waste of time for both of us. And in terms of misconception, 00:47:09.980 --> 00:47:12.440 I would say it's a distribution of power. 00:47:13.664 --> 00:47:21.584 And many startups or most startups feel kind of there is kind of the VCs have 00:47:21.584 --> 00:47:27.044 much more power and they completely underestimate how big the challenge for 00:47:27.044 --> 00:47:31.464 VCs is also to allocate their money and to deploy their money. 00:47:32.264 --> 00:47:40.284 And so this is much more at eye level than than many, many founders think. 00:47:40.284 --> 00:47:46.344 And VCs are desperately looking for investment opportunities and they have to 00:47:46.344 --> 00:47:48.944 do a lot to find good companies. 00:47:49.864 --> 00:48:00.124 And if you don't get money from a VC or from many VCs, I would kind of need 00:48:00.124 --> 00:48:03.204 to rethink your business model or the way you present it. 00:48:03.364 --> 00:48:07.804 It's not the lake of capital. There's more capital than is needed out there. 00:48:08.764 --> 00:48:14.764 So be aware that VCs kind of also need to kind of pitch you and want to. 00:48:14.904 --> 00:48:18.684 If you don't get money, don't use that as an excuse. 00:48:19.604 --> 00:48:25.244 Then maybe you obviously did something wrong or something is wrong with your 00:48:25.244 --> 00:48:26.964 model or you cannot get that across. 00:48:28.084 --> 00:48:32.324 Or all VCs are wrong, which I would also could be. 00:48:32.724 --> 00:48:38.984 That also happens. But first, I would look what I can rethink my business model 00:48:38.984 --> 00:48:45.564 or the way I present before I would assume that all VCs are wrong. 00:48:47.004 --> 00:48:51.744 What's the hardest tip for first-time founder about securing their first VC 00:48:51.744 --> 00:48:54.744 check? What would they need as advice? 00:48:55.824 --> 00:49:01.004 Be more relaxed. Be aware of the imbalance of power you just described. 00:49:02.376 --> 00:49:09.396 Yeah, that's more the attitude, how you go into it. But at the end is kind of what you optimize for. 00:49:09.616 --> 00:49:13.056 I did the mistake brutally, kind of don't optimize for valuation, 00:49:13.256 --> 00:49:14.496 optimize for personal fit. 00:49:14.936 --> 00:49:18.756 It's kind of, this is a one night stand you cannot get out of. 00:49:19.216 --> 00:49:26.316 This is a marriage for 10 years and they are on your cup table. 00:49:26.316 --> 00:49:35.456 So really, really also do your due diligence and think about, can I work with this? 00:49:36.136 --> 00:49:41.056 Typically, it's a person who represents the firm and kind of is a direct contact 00:49:41.056 --> 00:49:46.476 over that firm for the next five, six, seven, eight years. 00:49:47.056 --> 00:49:51.116 And always keep in mind this one TechCrunch article that I have in mind, 00:49:51.276 --> 00:49:56.196 which kind of emphasizes a very important point. more startups have been killed 00:49:56.196 --> 00:49:59.136 by the investors than actually their competition. 00:50:02.336 --> 00:50:06.956 Interesting point of view. I haven't thought about that. 00:50:07.096 --> 00:50:12.896 I don't know that article, but it resonates. Yeah, it resonates. 00:50:13.516 --> 00:50:18.416 Now let's go into the closing and looking a little bit ahead, 00:50:18.616 --> 00:50:20.696 the future of Identity VC. 00:50:21.216 --> 00:50:24.016 What is your long-term vision for the company? 00:50:24.756 --> 00:50:30.556 It's clearly being the European leader in LGBTQ and diversity funding. 00:50:31.896 --> 00:50:39.516 That's one dimension. The other dimension is to create and be the catalyst for 00:50:39.516 --> 00:50:44.276 a strong European LGBTQ startup community. 00:50:45.632 --> 00:50:49.112 That's not there. It's a little bit in the UK. We have that. 00:50:49.212 --> 00:50:53.172 We see that, how that could work in the US. There's organizations like Ganges, like Stardark. 00:50:54.432 --> 00:51:01.032 In Europe, there's still a lot of room to really integrate founders, 00:51:01.272 --> 00:51:03.392 investors across Europe. 00:51:06.452 --> 00:51:11.272 What are you most excited about the next 12 months except the publication of 00:51:11.272 --> 00:51:13.432 this interview? Along the different dimensions. 00:51:13.712 --> 00:51:19.352 So this year, we have around eight more new investments we want to make. 00:51:19.812 --> 00:51:26.372 So this is very exciting and a lot of work, but this is always great to invest 00:51:26.372 --> 00:51:29.292 and have a new company in the portfolio. 00:51:29.292 --> 00:51:37.052 So also founders, if you're looking for LGBTQ founders, if you're looking for capital, contact us. 00:51:37.692 --> 00:51:44.032 And then secondly is we want to do the final closing of the fund in the foreseen future. 00:51:44.472 --> 00:51:52.312 And we have a lot of things on the agenda around the community and what we want 00:51:52.312 --> 00:51:54.092 to achieve and what we want to do. 00:51:54.392 --> 00:51:58.272 So this was the very short version and just the highlights. 00:51:58.272 --> 00:52:06.392 So we have a very long list, probably more than we can do, but if we achieve 00:52:06.392 --> 00:52:09.592 part of it, that would be great. Awesome. 00:52:12.352 --> 00:52:17.052 Last final questions. How can people reach you? We'll link down here in the 00:52:17.052 --> 00:52:18.272 show notes your LinkedIn profile. 00:52:18.452 --> 00:52:20.472 Is this a good way to make a first contact? 00:52:22.424 --> 00:52:29.084 LinkedIn, email. Honestly, I'm not a friend of asking for warm intros. 00:52:29.384 --> 00:52:35.484 This is kind of a big problem of the industry, kind of that shows we only want 00:52:35.484 --> 00:52:39.424 to invest in the friends of my friends. 00:52:39.624 --> 00:52:44.024 And that's one reason why this industry is not so diverse. 00:52:44.344 --> 00:52:50.064 And that's kind of same universities, same background, whatever. 00:52:50.064 --> 00:52:58.184 We want to see founders who were not part of that communities and who others might not have seen. 00:52:58.384 --> 00:53:04.664 So you can find my email on our web page. You can contact me via LinkedIn. 00:53:05.124 --> 00:53:09.344 And please do me one favor. If I don't answer at the first time, 00:53:09.544 --> 00:53:11.744 just write a second time. 00:53:12.064 --> 00:53:14.884 Sometimes things get lost. Sorry for that. 00:53:16.184 --> 00:53:22.464 I have the standard receipt check since I had a random idea during the interview 00:53:22.464 --> 00:53:25.964 with Alex from Frankenberg, at the time CEO of Hitech Krümerfonds. 00:53:26.384 --> 00:53:32.584 I asked him, he also sent me an email, and I asked him, would you reply to an 00:53:32.584 --> 00:53:36.404 email that only says, yo, we should talk? Would I reply? 00:53:39.824 --> 00:53:46.404 I don't know. I don't know. It depends. I would say one more keyword would help 00:53:46.404 --> 00:53:51.184 or a LinkedIn profile or one trigger and that's. 00:53:54.175 --> 00:53:57.635 Maybe I would, because this is very rare. 00:53:57.895 --> 00:54:01.915 I don't reply to emails that are not personally addressed to me, 00:54:02.055 --> 00:54:03.655 and there's more than you think. 00:54:03.835 --> 00:54:07.355 This is hi, comma, blah, blah, blah. 00:54:07.735 --> 00:54:12.915 And you can see that was a mass email. This one is immediately delete. 00:54:14.815 --> 00:54:21.835 I see. Also, that would be a good way for people looking to work with Identity 00:54:21.835 --> 00:54:25.175 VC as part of your staff. Best thing is follow us on LinkedIn. 00:54:25.575 --> 00:54:30.315 That's anyway a good recommendation. Then you're up to date what we invest in, 00:54:30.495 --> 00:54:33.495 what events we do. Kind of we do a lot of community events. 00:54:33.695 --> 00:54:38.255 So we have upcoming events across Europe and also job posts. 00:54:38.455 --> 00:54:41.395 So I would say that's probably the best thing. Follow us on LinkedIn. 00:54:42.435 --> 00:54:46.215 Great. Till, that has been a fantastic conversation. 00:54:48.375 --> 00:54:53.095 I loved it. Thank you very much. And to our listeners, what's a question? 00:54:53.335 --> 00:54:59.375 You would like to ask Till about Venture Capital. Drop your questions down here in the show notes. 00:54:59.995 --> 00:55:04.495 Till, thank you very much. It was a pleasure. Thank you. Pleasure was mine. Thanks for having me. 00:55:05.295 --> 00:55:08.435 And talk soon. Talk soon. Bye-bye. Bye. 00:55:13.715 --> 00:55:22.875 That's all, folks. Find more news, streams, events, and interviews at www.startuprad.io. 00:55:23.335 --> 00:55:25.415 Remember, Sherry is Carrie. 00:55:26.160 --> 00:55:38.944 Music.