Investment Principles & Criteria

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Every startup thinks they are worth £1M. I have news, NO startup ever is. If you think yours is, then sell it and use the £1M to self fund your second startup which is also coincidentally worth £1M. Can’t sell it, then it never was worth the money.

I don’t want to exit. All other professional investors do, but I am looking to invest in technology that will change the world. This takes time and I am in no hurry to leave.

Founders should retain more than 50% of their company right up to IPO. Otherwise they loose control and the company will loose its focus and passion. I don’t like shareholder agreements, so if I am going to make a significant investment then I require more than 25% of the stock, which gives me vote blocking rights. Why? Shareholders agreements require court reaction to prevent actioning bad decisions. A major shareholding requires a vote to make major decisions.

The business you are pitching should be your only business, you should not be running any other business nor should you attempt to offer a sub division of your company.

I love disruptive technology, I almost always invest in something that I can see will change a part of the world.

I’ll want to know why you want me as an investor. That requires you to spend time researching me. If you’re only interested in my money, then I’m not interested in your company.

There are three types of founders. Ones that don’t take advice, ones that take advice verbatim and ones that take some advice and adapt it to their own situation. I only invest in the last type.

You must have co-founders and those co-founders must be directors and shareholders of the business.

If you are a technical company and you don’t have a technical co-founder find one.

Don’t lie. And more importantly don’t lie. If your pitch deck shows you have three directors and companies house only shows one, then you’ve lied. If you say you have a patent or a contract I want to see it. If you say you have a unique solution I will find out. If you say you are an expert, I will test you.

Don’t be stupid and don’t rely on me being stupid.

Be aware that your business may not be what you think it is to an investor. To give an example, a property investor sees a data centre as a buy to let commercial building where the tenants are computers that command around 20 times the rent of humans. Or, as in one case, your “Dating” website is actually a “Groupon” clone, selling discounted tickets for couples.

I will generally try to be honest and give you my opinion as to whether your idea is good, whether I invest or not. I am usually happy to give an hour or so of my time for free, so don’t be afraid to ask questions.

 

Back to: About me