A model of support for hi-growth SMEs – Octopus Ventures
Octopus Ventures applies all the techniques of intensive development that are typical of Accelerators, but it does so at longer range. It invests in small businesses with potential for very high growth, and then it is set up to provide whatever support is necessary in order to achieve that potential.
Octopus Ventures looks for businesses that are led by outstanding teams that have unique products that are likely to find multi-million pound markets. It focuses on what have been characterised by Nesta as ‘the 6%’ of small businesses that are capable of influencing the UK economy.
Many of its investments come from referrals from people and organisations that know them well – for their deep pockets and their willingness and ability to follow their initial investments in subsequent rounds, but also for the fulsome support that they provide in order to achieve the high potential that they see in these businesses.
Support in handling the hurdles of growth is the essence of Octopus Ventures’ business; and the role of its people is to provide any and every support that they can muster in order to help unlock the growth that they anticipate. This support has four components.
First and foremost, all of the eighteen people in Octopus Investments ensure that they are always in close touch with every one of their forty-five investments – close enough touch to be continuously aware of their growth plans and the obstacles with which they are dealing just now. And they have the ability immediately to put someone in any of those businesses in touch with a top-level expert on the topic in question.
The leaders of Octopus Ventures’ support are its in-house Entrepreneurs-in-residence – its leading growth Gurus, of whom there are currently three. One is Google’s former M&A manager, the second is a very experienced entrepreneur, and the third comes from UK Trade&Industry, where he was an expert Far Eastern markets. All have a great deal of experience, an intense interest in venturing, and large address books; and two of them have taken roles in the companies in the portfolio.
From time to time Octopus managers bring together the managers in those businesses (the CEOs, the COOs, the CTOs, the CMOs and the CFOs) – sometimes in person, sometimes by phone, in the offices of one or other of the companies or at Octopus Ventures in London, to talk about issues that they have in common and how they are dealing with them. Among contributors to these meetings have been Amazon’s Technical Services manager and Google experts.
The fourth plank in the programme of support is through the hundred or so Angels who are associated with Octopus Ventures, who may invest alongside Octopus, but whose support and practical input is at least as valuable as their investment.
London is widely regarded as easily the largest funder of early-stage businesses, and thus an ideal source of support to help them achieve their growth – which Octopus people tap into and skilfully connect to the needs of the businesses in their portfolio.
In Accelerators, support of these kinds is provided in one location and for a short period; but here, similar support is provided in various locations and over a longer period – a model which can be replicated in Incubators, Science Parks, clusters, the Business Growth Fund and innovation initiatives of all kinds, including InnovateUK.
We shall shortly be holding a Workshop on the role of support in intensive development, in which we hope to include Conductors, Directors, Coaches and other supporters in different kinds of creative performance.
Stories from the front line: what Startups value most in Accelerators
What they get out of ‘Office Hours’, group lunches, others on the programme, their first meeting with mentors, mentor slots and other events. http://wp.me/p3beJt-a7 Feb 2015
I interview the ‘best mentor’ in Startupbootcamp’s FinTech Accelerator
In and out frequently, he steadily evolved his role by offering the wealth and breadth of experience of a life-time’s work in a top bank – clarifying progress and problems, acting as a sounding board, offering experienced insights, and marshalling help. http://wp.me/p3beJt-9P Dec 2014