VC + Research Institute run Accelerator

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VC collaborates with national research institute to run its own accelerator

A specialised investment firm has partnered a research institute to create an accelerator – for companies whose business is centred on the creation of data and the application of data science.

Winton Labs is a startup accelerator for data science companies, run by the venture division of Winton, a data-technology global investment firm. Winton has a long history of successfully applying data science to disrupt the world of investing, and wants to support companies that have the same data centric view of the world.

The Alan Turing Institute as the national centre for data science sees part of its role as nurturing the next generation of data science leaders and entrepreneurs, and offered technical advice built on their own academic and industry experience and connections in the field.

London is, reportedly, home to world-class academics, start-ups, data scientists and innovators and a hotbed of innovation on such topics as algorithms, big data and artificial intelligence. The programme provided a great opportunity for collaboration to help entrepreneurs build new, value-generating companies able to compete on a global scale.

Managed by Winton Ventures, the 3 month programme took place in the Lab’s co-working space at Winton’s London HQ, and drew mentors and expert advisers from Winton’s internal experts, the Alan Turing Institute, academic partners, and a broad external network.

The five early stage start-ups won their place on the accelerator programme from over 100 applicants and have now had an opportunity to pitch to funders for future investments.

John Whatmore, April 2017

 

 

 

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Raising the Mentoring Game

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Raising the mentoring game

Stops and starts have marked the very slow progress of mentoring in the UK. As the ultimate beneficiaries of mentoring, funders of new businesses should be leading the way.

The big question is (and was) why hasn’t mentoring taken off in the UK. Its best known successes include Richard Branson (said to have four mentors). the Princes Trust, and in Accelerators. Two levers were touted at the recent Annual Conference of the Association of Business Mentors (‘ABM’), both winners of the ABM’s Award for Commitment to Mentoring, but both embryonic.

Two initiatives

National Mentors Day’s third incarnation, masterminded by the redoubtable Chelsey Baker, will take place in October 2017, as a seriously bigger, more widespread, much more inclusive and hopefully more impactful day. And Janette Pallas, now at the University of Warwick Science Park, received this year’s award for her pioneering work in creating ecosystems of support in incubators and their ilk – a way forward being strongly encouraged in two recent regional meetings by the Scaleup Institute.

Non-progress

It is now several years (2011 to be precise) since the government made a commitment to put 10,000 mentors in place; and mentoring was a key part of the government’s Growth Builder programme, started in   2012, but alas for some strange reason withdrawn in 2016. Mentoring is an integral element of recent scaleup programmes, such as the Judge Institute’s and the RBS/UCL programme, but the mentoring scene is necessarily local and its institutions fragmented.

                                                   Funders should take the lead

It would be good to see funders take the initiative (eg VCs and Angel Funds) and along with innovation centres and development programmes (where mentoring is usually mandated) work in partnership with sources of mentors like the ABM (eg running joint workshops). The likes of the ABM could encourage mentoring by appointing ambassadors, and running more awards schemes or prizes. What is needed is a campaign of the extent of the Public Understanding of Science.

John Whatmore, March 2017

 

Speed as the new essential

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Speed as the new essential David Giraourd, former President of Google Enterprise Apps and CEO of startup Upstart argues that speed is the key competitive advantage of to-day [and not just in Accelerators].

His top points are:

* Think first of all about the importance and the timing of each decision.

* Next about the inputs and perspectives of your team that you need.

* Make sure that all plans come with assigned completion dates.

* Prioritise mission critical items.

* Make sure that people are not waiting for one another, and can work in parallel.

* Firm up on doubtful assumptions eg legal or regulatory.

* Confront uncertain lines of authority eg CEO vs Founders vs Managers.

 * Use your competition as your incentive.

* Help the members of your team to help you: what inspires them. And tell them why your objective is so vital.

 I’ve long believed that speed is the ultimate weapon in business. All else being equal, the fastest company in any market will win.

Speed is a defining characteristic — if not the defining characteristic — of the leader in virtually every industry you look at. In tech, speed is seen primarily as an asset in product development. Many people would agree that speed and agility are how you win when it comes to product.

What they fail to grasp is that speed matters to the rest of the business too — not just product. Google is fast. General Motors is slow. Startups are fast. Big companies are slow.

The building blocks of speed are in making decisions and executing on decisions. 

A good plan violently executed now is better than a perfect plan next week. The process of making and remaking decisions wastes an insane amount of time at companies. When a decision is made is much more important than what decision is made.

You should consistently begin every decision-making process by considering how much time and effort that decision is worth, who needs to have input, and when you’ll have an answer. Some decisions are more complicated or critical than others: more information might be essential; some decisions can’t be easily reversed or would be too damaging if you choose poorly. Most importantly, some decisions don’t need to be made immediately to maintain downstream velocity.

Eric Schmidt at Google knew he stalled a lot of things, but Eric made sure that decisions were made on a specific timeframe — a realistic one — but a firm one. The art of good decision making requires that you gather input and perspective from your team, and then push toward a final decision in a way that makes it clear that all voices were heard. You don’t want consensus to hold you hostage — but input from others will help you get to the right decision faster, and with buy-in from the team.

There’s an art to knowing when to end debate and make a decision. We intuitively want the team to come to the right decision on their own. But people are enormously relieved when they hear that you’re grabbing the baton and accepting responsibility for a decision.

Executing decisions A lot of people spend a whole lot of time refining their productivity systems and to-do lists. But within the context of a team and a business, executing a plan as quickly as possible is an entirely different concept.

Many plans and action items come out of meetings without being assigned due dates. Even when dates are assigned, they’re often based on half-baked intuition about how long the task should take. Completion dates and times follow a tribal notion of the sun setting and rising, and too often “tomorrow” is the default answer. For items on your critical path, it’s always useful to challenge the due date. All it takes is asking the simplest question: “Why can’t this be done sooner?”

Just as important as assigning a deadline, you need to tease out any dependencies around an action item. Mission critical items should be tackled head-on by your team in order to accelerate all downstream activities. Things that can wait till later need to wait.

A big part of this is making sure people aren’t waiting on one another to take next steps. The untrained mind has a weird way of defaulting to serial activities — i.e. I’ll do this after you do that after X, Y, Z happens. You want people working in parallel instead.

Projects can be so complicated that it can seem you have to go back over the thinking so much that everything else grinds to a halt too. For example, our business at Upstart has to comply with a lot of regulations. There’s not a lot we can do until we know we’ll have legal approval, so we used to spend a lot of time dancing around whether something was going to be legal or not. Then we thought, why don’t we just get a brain dump from our lawyers saying, “Do this, this and this and not this, and you’ll be fine.” Having that type of simple understanding of the problem drastically reduced the cognitive overhead of every decision we made.

If you can assess, pull out and stomp on the complicating pieces of the puzzle, everyone’s life gets easier. The one I see the most — and this includes at Google too — is that people hem and haw over what the founder or CEO will think every step of the way. Just get their input first. Don’t get your work reversed later on. What a founder might think is classic cognitive overhead.

Talking about your competition is a good way to add urgency. At Upstart, we constantly say that while we’re working hard on this one thing, our competitors are probably working just as hard on something we don’t even know about. So we have to be vigilant. A lot of people say you should ignore competition, but by acknowledging it, you’re incentivizing yourself to set the pace in your market.

When we were launching Google Apps, we were coming out against Microsoft Office, which had this dominant, monopolistic ownership of the business. We thought about what we could do differently and better, and the simplicity of our pricing was part of it — I think we decided that in a half hour. We just wanted to be able to tell people, “We may not be free, but we’ll be the simplest decision you ever made.”

Once you’ve made a decision, you’ll need to convince others that you’re right and get them to prioritize what you need from them over the other things on their plate. You need to understand this person, what their job is, how their success is measured, what they care about, what all of their other priorities are, etc. Then ask: “How can you help them get what they want while helping you get what you want?”

I’ve seen this done by appealing to people’s pride. Maybe you tell them that you used to work with a competitor who was quite speedy so that they have incentive to go even faster. I’ve also seen this done by appealing to human decency and being honest. You might say something like, “Hey we’re really betting heavily on this, and we really need you guys to deliver.”

Whichever route you choose, you want to back up your argument with logic. You should gently seek to understand what’s happening. I tend to ask a lot of questions like: “Can you help me understand why something would take so long? Is there any way we can help or make it go faster?”

To keep things moving along at Upstart, I ask a lot of hard questions very quickly, and most of them are time related. I know that we execute well and are generally working on the right things at the right time, but I will always challenge why something takes a certain amount of time. Are we working as smartly as we can?

Too many people believe that speed is the enemy of quality. To an extent they’re right — you can’t force innovation and sometimes genius needs time and freedom to bloom. But in my experience, that’s the rare case. There’s not always a stark tradeoff between something done fast and done well. Don’t let you or your organization use that as a false shield or excuse to lose momentum. The moment you do, you lose your competitive advantage.

 

A Venture Capital company runs its own Acccelerator

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Venture capital company runs its own accelerator

Activate Capital is running an accelerator programme in Ealing, London over a six week period – it’s ‘digital startup studio’. It includes strategy and planning, product design, advice on company structure as well as pitch coaching for future funding rounds.

It aims to focus on the needs of individual startups, with specific topics addressed each morning and afternoon in a structured programme, tutored by the eight principals of Venture Capital business (founded in 2016).

Startups contribute up to 5% of their equity; and once the programme has finished, successful applicants have the opportunity to gain access to seed investment of £100K, to optimise product development and secure future finance.

Activate Capital claims to have invested in three companies last year. Their concern is that the average success rate in Accelerators is one in ten and they are seeking to ensure that all of those that go on their programme succeed. “We are committed to working hand-in-hand with start-ups to ensure that they get the advice, insights and support that they need.”

John Whatmore, March 2017

 

 

A venture capital company that knows its onions – because it grows them

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Sovereign Capital runs its own academies – in the music industry

I’ve just come across an unusual set-up in the innovation eco-system: a venture capital company that runs its own academies for startups; but would you believe this: one of them is for song writers! It is as though a VC in Bioscience had set up its own entrepreneur school for potential CEOs in synthetic biology.

But why not? Song writing and bioscience used to be callings which had their own very specific origins, but both of which now demand business nous.

What is being taught? Isn’t songwriting something “you’ve either got…or you haven’t”; “they just come to you”, said one successful writer. But the pedagogues at the Institute of Contemporary Music say that popular musicians hide the fact that they have had to study their craft; that there are elements of songcraft (just as there are in creative writing) that can be taught – like where to put in a middle eight or a key change; and individuals can be introduced to writer’s works that speak to their own work. ‘We provide tools and a regime of learning and development – about production, performance and business.’ (See the video ft.com/rockschool.)

Importantly, students are helped to develop their brand and to monetise it – for example by making contacts. When they are ready, they get introduced to potential managers, publishers and labels. There are lots of panels, with guests from the industry – talking about digital marketing, how to analyse data, the demo-graphics of your potential fan base, and of course contracts; and there are regular Master Classes.

“We used social media to find out where people were listening to us, and where our potential market might be going”, said one band that had just organised a tour.

If programmes like this, which provide aspiring musicians with a variety of routes to using their talents in the music industry, are more common than they used to be, the presence of a venture capital group is a great deal less so. Sovereign Capital, ‘the largest and leading provider of contemporary modern music education in the UK and Europe’ (which inter alia owns the British and Irish Modern Music Institute with its branch in Fulham,) is described as a big player in this sector with some notable and much trumpeted success stories to its credit.

The recent Barclays Scaleup Report emphasised the importance of expertise in venture funding. There can be few better ways of developing that expertise than in having an organisation whose essence is the development and commercialisation of talent.

John Whatmore, March 2017

 

Big bets on big ideas

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Big bets on big ideas – by philanthropists ‘Problem first, tool second’ is a maxim that is common among philanthropists, but far from common in the startup world.

We celebrate the fast growing entrepreneurial culture, but too many startups are ‘noddy projects’, built on exploiting little more than convenience or alacrity; often led by people with scant knowledge or experience of management or about the sector which they aim to enter and its customers.

Many fewer are the enterprises that start by identifying major needs or opportunities and building a business to fulfil them. Among these are the Young Foundation in the UK, which has long supported social enterprises, and Village Capital in New York, which has raised funds and then used them to bring experts to bear on major world problems.

But also there are individuals who have made millions and then sought to use their wealth to attack these problems, such as Bill Gates and Mark Zuckerberg. Do their approaches tell us anything about how we could address bigger issues and address them better?

What is common to most of them is that they aim to use the high level of their own expertise with which they have achieved their own success, and do so in wider, more beneficial fields where the returns are not necessarily financial.

Soon after Dustin Moskovitz, a Facebook co-founder, and his wife began their philanthropy five years go, they partnered with a charity research organisation called Give Well, that identifies projects that ‘provide outsize human benefits for the dollars invested’, through which they gave substantial sums, inter alia to a programme for distributing mosquito nets to reduce malaria, and to a programme that gives cash directly to poor people in Kenya and Uganda. More recently they have chosen to fund projects that mitigate potential global catastrophes, like an epidemic of a deadly disease, biological warfare and the dangers posed by artificial intelligence.

‘Tech people tend to be more interested in early-stage startups’, said one expert, ‘they typically support disruptive new ideas, get more involved in their giving and show a willingness to move quickly to another approach when one fails.’

Zuckerberg and his wife (who is a doctor) chose to invest funds in efforts to build basic tools to help the whole scientific community to make breakthroughs in research. A substantial sum went to create a new research institute in San Francisco – the ‘Biohub’, whose first project was to map all the cells in the body and set up a rapid strike force to tackle outbreaks of infectious diseases like Ebola and Zika viruses.

And they aim to advocate for more private money for this purpose, and will ‘likely take ownership stakes in for-profit companies doing promising work.’ Their multipronged approach – gifts, VC investments in businesses with social missions, and policy advocacy is described as ‘giving them maximum flexibility’.

Pierre Omidyar , founder of the eBay online auction and retail site, was an early pioneer of this concept. His philanthropic organisation focused on efforts to bring financial services to underserved populations. It financed a non-profit that makes microloans in Africa, Asia and Haiti; and it has invested in a peer-to-peer lender and in a company that provides insurance to low-income people in emerging markets. He participates in an advocacy group that partners with governments and others to encourage the distribution of money digitally instead of through cash handouts. ‘We have a motto here: problem first, tool second’, said the managing partner of his Foundation – an approach ‘widely adopted by the region’s philanthropists’.

The Omidyar Foundation which focuses on early-stage projects, also takes board seats and provides networking opportunities and training to the organisations it finances. ‘Half of the organisations report that our non-monetary assistance is as valuable as our monetary assistance’, says the managing partner.

Measuring success ‘is a bit of a fool’s errand’, he has said; but proactive, they are. At all events, principles like that of focusing on underfunded yet highly effective charities seem to remain paramount. So far we have rarely seen comparable individuals or organisations in the for-profit field.

Source: New York Times, 8.11.2016

John Whatmore, January, 2017

Attracting SMEs to the UK

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Bringing leading young businesses to the UK The UK’s attractive Sirius Programme has a new format and a new (private sector) management 

The Sirius programme aims to bring some of the best young entrepreneurial talent from around the world to the UK where they can build their businesses for the benefit of themselves and the UK economy. Participants receive a complete package of services to maximize their potential for success – probably better than any UK young business could expect.

The package includes seed funding of approximately £35,000 plus 30-days of acceleration training, mentoring, twelve-months office accommodation and support in obtaining visas from a dedicated Sirius allocation. The total package is estimated to be worth up to £60,000. Companies participating will cede a 10% stake in exchange for the support received.

Sirius was developed originally by the then UK Trade and Industry (UKTI) in 2013 to promote the UK as a destination for young entrepreneurs, and to date has attracted over 2,300 gifted and ambitious applicants from 93 countries, leading to 73 companies coming to the UK. The programme aims in the future to attract up to 100 entrepreneurs representing 40 new companies to the UK each year; and these will be spread across different regions of the UK.

Management of the Sirius Programme has been transferred to a consortium of private and charity sector organisations to facilitate its growth and development. The consortium includes The Accelerator Network, Entrepreneurial Spark, NACUE, Natwest (part of the Royal Bank of Scotland Group), The Rain Gods and White Horse Capital.

The support programme is to be run on a not-for-profit basis and seed funding for the start-ups will be sourced from UK private investors under the Seed Enterprise Investment Scheme (SEIS), with the expectation of a strong investment return given the calibre of international start-ups and the support they will be able to access in the UK, now including investor input.

Timothy Barnes, Chairman, Sirius New Direction Ltd commented (3 Nov), “The development and growth of the Sirius Programme underlines our confidence in the reputation of the UK as a leading global destination for young entrepreneurs. There are some incredibly ambitious entrepreneurs with great business ideas that would benefit from being based here and we are keen to hear from them all!”

He added: ‘It is a highly competitive programme, but with much of the previous marketing conducted outside of the UK it is not as well known within the country as it might be. Teams from anywhere in the world can apply, as long as one or more of the co-founders is from outside of the UK. Overseas students already in the UK as part of their education are particularly welcome.’

Applications for the new format programme are open now via http://www.siriusprogramme.com – the first cohort to be selected before the end of the year, to be active in the Spring of 2017.

John Whatmore, November 2016