Venture Capital to the Masses

There is a problem in venture capital and early stage investing: some founders, located in certain cities, and with recognizable business models and routes to market, get funded while others, with similarly robust business models and go-to-market strategies, don’t; at least not at the rate they should.

This has worked pretty well for those successful founders, many of whom go on to become investors themselves and then perpetuate the system with a ‘go with what you know’ approach, supporting – however unintentionally – the future gatekeepers of precious early stage capital.

Ignoring the inequity of this system, at some point we will have scraped the entire barrel of traditional founders and startups, disrupting on the margins of their traditional boxes. We will almost certainly have missed out on value creation and economic growth because they do not represent the majority of the best ideas, or understand the pain points and problems that need solutions as fundamentally as the majority of people they build them for.

We also concentrate wealth into traditional centres, like London or Silicon Valley, New York or Hong Kong. While there is something to be said for the concentration of talent and ideas the world can and will move beyond that. Teams are becoming distributed, especially as these centres become too expensive to live in. Technology and talent are streaming out of universities all over the UK but to get funded they need to uproot permanently or at the very least spend considerable time in London, building networks there, attending endless pitching events, kissing the ring, hoping to be noticed by influential VCs and angels.

We bias capital towards buzzwords and models we’ve seen before. Crowdfunding is great for breweries or consumer apps. Angel networks like traditional business models with a clear route to trade sale in a few years. Venture capital is slightly better but suffers from the same short term pressures that prevent long term value creation and growth in the face of early exits to satisfy LPs. New startups with truly disruptive technologies that can legitimately change the world don’t get funded because they don’t tick certain boxes around MRR or traction, or a clear path to exit.

We’ve had enough.

And so have founders that don’t fit the mould, or live in the right place, or have a business model that can’t quickly be described as an app that is like Uber for…

We’ve had enough of pitching events, or ‘come back to me when you have X revenue’ or making decisions based on where founders were educated. We’ve had enough of those angel networks that are really just social clubs hosted in wood-panelled rooms over warm chardonnay and canapes. We’ve had enough of institutional investors who find deal flow only through their networks because they are too lazy or scared to actually go out in the world and discover things on the margins.

We are aiming to help change all that, starting with the launch of Networks on the Capital Pilot platform. These are groups based around regions, affinity groups, and sectors, people who use the Capital Platform to provide hands-on support to founders, and cultivate networks of investors to invest in them. These networks are linked so that everyone can benefit from one another and tie together more and more people to link their contacts and relationships for mutual advantage.

In practical terms that means for startups when they join Launchpad by Capital Pilot (our digital fundraising accelerator) they can select a network to join. These networks review their pitch, give them guidance on how to put their best foot forward and think through their business model and value proposition, and ultimately link founders with angel investors and VCs that they know and work with. For investors, joining these networks means accessing vetted deal flow in specific regions, or sectors, or causes that they want to support.

We launch initially with regional ‘Launchpad’ networks focused on Scotland, the South West, the North East and Yorkshire, the North West, and Thames Valley, with many more on the horizon. We’ve also started a Launchpad: Women network, and a HealthTech group, run by the Tech London Advocates Health Tech Working Group. We’ve only just started.

We want you to join us

What this means practically for future and existing users:

If you are a startup – register today at launchpad.capitalpilot.com where you can build your profile and select a network to join once you submit your pitch for review. These networks will help you through the rest of the fundraise process.

If you are an investor you too can join at launchpad.capitalpilot.com and have the opportunity to join networks, share your criteria, and see the great startups that have been vetted and supported by these network groups.

If you want to support startups and connect your network via the Capital Pilot platform, then get in touch with us today  and we can help you join an existing network, or better yet create your own. Whether it is around a region, a sector, a cause you care about, an accelerator programme, a university or alumni group, or anything else. We’d love to hear from you and get you set up with us.

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