the identity situation
#67
Hey guys, happy Sunday!
Here’s what I have this week.
Euro intel
❄️ Powder:
🇫🇷 Tikehau Capital
🇫🇷 Serena
🇬🇧 2150
🇬🇧 Skylake Capital
🇩🇪 MorphAIs
🇪🇸 Two small VC funds merged, raised €30 million in fresh money.
🇳🇴 Motion Ventures
🇺🇸 Sequoia
💸 Active this week:
VCs: Moore Strategic Ventures, P9, Accel, Downing Ventures
Angels: Christophe Courtin, Florian Douetteau, Sven Rittau
🔥 Interesting deals:
🇫🇷 NFT
🇸🇪 online marketing with personalised celebrity videos
🇩🇪 B2B2C API-based marketplace
🇪🇸 car and motorcycle rental business
🇬🇧 manufacturer of alternative tech for producing batteries
🇩🇰 social network platform for chefs and cooks
🇫🇮 social e-commerce
🇸🇪 coding school for girls
🇬🇧 on-demand laundry and dry cleaning platform
Observations
🇬🇧 Imagine for a second you are a founder at the beginning of a journey.
You want to build a new business, something that makes impact and that should be durable, at least 10 years down the road.
You think hard about the need and how your product fits that need, about the target customers and about the market segment.
You figure you can create that unique value proposition that makes you special, with a GTM that gives you a good rep and credentials - people on the street will know who you are, if all this works out.
You see it through and it makes sense, you’re onto something. You work your ass off to put together all this research into a product reflecting your vision, and get it business ready in order to launch it.
Before you make it public, there’s one more thing: you need to choose an identity reflecting all this special work you’ve been doing.
That identity is something that people know you by. The packaging is as important as the value the product provides - you want to choose something that is unique and undoubtedly associating your work with your name and your rep. It’s a whole, and everything needs to be consistent.
The professional way to do this is to work with a brand agency, whose job is to give you an identity and make you look good. If you ever worked with a brand agency you know that the deliverable of those guys is simply a reflection of who you are, your values and of what you and your product stand for.
But you decide not to do that. Maybe you think you already got it, or don’t think it’s that important, or worth it, or maybe you are too busy for this anyways. You settle for a name, create a fancy website, write that Medium piece your peers will judge you by, you activate your journalist friends to get you a bit of PR momentum and you finally come out in the world.
And then you get this random screenshot from social media.
Which one are you and who will your customers think you will be? Are you Adidas or Adibas? Are you Gucci or Guci?
I can only imagine board discussions where founders ask their investors advice about marketing.
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🇬🇧 The UK government is encouraged to promptly consider the SPAC revolution. Given the huge gap between US and Europe, trying out a financial instrument that’s been around for a year might as well be a revolution.
In case you missed it, last week we counted already 12 high profile Euro people riding the SPAC wave from Europe, including “the highest-paid banker in Europe”.
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🇪🇺 Also in Europe, I have lately noticed a trend of corporates trying to get friendly with startups by budgeting good media money for useless studies and/or random content invented by media sales.
I think it is a good thing they are doing marketing to appear friendly and actively interested in the startup space. But I also think that they are like Macron spending money for startup conferences to get re-elected instead of simply fixing fundamentals of doing business in France.
Everybody in the startup world knows that doing biz devel with big companies is complicated, in the best case scenario. Tons of decisions layers, lack of accountability, dealing with paper pushers and end-of-the-year bonus hunters, super long cycles for everything, bureaucracy sometimes heavier than that of governmental institutions.
And more importantly, the problem is the lack of success at the end of making those efforts. There are exceptions, of course, and when there are, they should be the marketing materials per se.
As for startups raising money from corporations - you either take it hoping to be a pre-exit deal for selling them the whole thing if things work out right, or for a promise to preferential access to fat markets you wouldn’t have access to otherwise.
Sometimes it works, most of the time it doesn’t. How do I know that?
The VC-backed M&A activity done by European corporations on local basis is tiny, a minuscule number, compared to the appetite of our friends from US.
This lack of M&A appetite is one of the many fundamental problems of the Euro private investment market.
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🇩🇪 There’s also good people doing investment business in Europe - Point Nine Capital are one of those guys, some of the most connected and active early stage/first institutional in Europe. They know their shit - they have clear positioning, good rep and, more importantly, great record on the street.
They just changed their site - it’s clean and nice, without the pretentious fluff and wooden language you usually expect from VCs - and are hiring too, if getting a VC job is your thing.
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🇬🇧 A thread about how 3 British angel investors prefer to make decisions.
The thing with angel investors is that it’s rarely you raise from them, it is they who decide to invest in you.
It is a very quick on/off decision on their part, mostly based on chemistry and familiarity with a domain. The good ones are very connected and there’s a considerable network effect since the pros are rarely loners, they hunt like a pack of wolves.
And further down the chain angels are the main feeders of the early stage institutional, as a path to their own liquidity.
✍️ Other notes
🇪🇺 Best 50 Nordic - the 2020 class of interesting early stage startups from the Nordics.
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🇬🇷 The VC activity in Greece is heating up.
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🇷🇺 If you’re into private investments or simply want to understand how the world works, do yourself a favour and watch this no-BS interview with Yuri Milner.
Out of 60 investments DST made in the last 10 years, we lost money only on two.
It’s solid, almost 3 hours of many things to unpack.
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🇷🇺 Speaking of stuff coming from Russia - Russia’s answer to Amazon looks West after beating local rivals.
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🇬🇧 Hey Siri, define quaint.
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🇪🇺 European investors are not yet prepared for climate tech. Well, maybe not all of them, but I know some who actually are.
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🇩🇪 The argument of choosing to raise money from a seed-focused fund as opposed to raising from a large generalist one, made by a seed-focused fund.
In other words, founders need to decide if they’re the one of the many from an Excel spreadsheet or if they want to have a speed-dial, special relationship. I doubt that the thinking is that advanced on the startup level, money is money, after all, and competition is a wonderful thing.
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🇪🇸 More honey in the tummy - Alphabet in talks with Spanish publishers to bring Google News back.
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🇩🇪 Thrasio makes another German acquisition, amps up its Europe spending.
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🇩🇪 EY ousted its German CEO because of the Wirecard scandal.
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🇩🇪 Birkenstock (famous sandal maker) in a €4bn deal selling a majority stake to L Catterton, a private equity firm backed by Bernard Arnault's LVMH.
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🇩🇪 Haircut prices have risen up to 8.2% (children) since after Lockdown1. Got a confession to make - I haven’t had a haircut since last August.
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🇳🇱 A beautiful 3D map of all 10 million buildings in the Netherlands, coloured by their age.
Charts of the week
Online love
The EV situation in Europe
Other stuff
TikTok decomposed, obligatory reading.
The future of social audio: Startups, Roadmap, Business Models, and a Forecast
VCs closing deals on CH.
McKinsey has leadership problems.
What you need to know about NFTs + good thread
Will you pay for reading someone’s tweets?
Facebook launched an ad campaign to help people understand how the personalized ads they see are helpful.
The Australien Government has made an ad about the new media legislation it just passed, and it's surprisingly honest and informative.
Soy is one of the leading drivers of deforestation. People often think of soy milk, tofu & similar products but these make up only 4% of soy consumption. 77% of global soy goes to animal feed.
California bill requires ‘Gender Neutral’ stores, fines retailers $1000 for having separate ‘Boy’ and ‘Girl’ toy departments.
The Cherokee Nation is asking Jeep to change the name of its Cherokee and Grand Cherokee vehicles.
Happy Sunday!
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Created every Sunday by @drnovac.
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