Consilience Ventures Investment Thesis: Phase 1
Kevin MONSERRAT
Tech Business Founder & CEO | Board Member | Innovation | Business Development | Investment
Consilience Ventures is an innovative, data-driven investment community built solely to encourage and stimulate rapid growth for early stage DeepTech start-ups. We’ve created a community of entrepreneurs, experts, and investors that all benefit from our:
1. first to market ‘sprint -financing’ model and
2. proprietary technology to mitigate risk and maximise their returns,
democratising start-up growth through technology. It’s a new way of getting start-ups off the ground, more reliably, more profitably, and at a lower cost to both founders and investors.
What We Look For In Our Portfolio Companies
The companies which we think would be a good fit for our community reflect our core values. We’re Unified, Bold, Resilient, Purposeful, Agile and Authentic; our portfolio companies exude the same core values that we do. Alongside our core values, we have certain criteria we look for in our investee companies and their management teams.
The Management Team:
· We look for management teams which have 2-3 diverse founders, with at least one technical founder, who can demonstrate a clear path to how they intend to grow the business/IP.
· We look for management teams which have a working prototype or have at least one Proof of Concept.
· We look for management teams which are customer focused; care about their customers and are genuinely interested in making their life easier. They must be able to articulate the opportunity in the niche in the market they are pursuing and must be able to explain with passion and precision
- the buying motives of prospective customers and
- how their product or service solves their problem or
- removes their limitations.
Here’s our own example:
We help Founders by removing the need to spend the (raised) capital to buy services from curated domain experts - marketing, business development, strategy, finance, legal etc. – since we can provide that through our curated expert network. This enables them to be a lot more capital efficient. We accelerate Founders’ speed to market, minimising dilution and increasing the pot of capital available for them to invest into the product / their business.
We help Experts by removing the risk of undervaluing their contribution to the success of the business – i.e. they receive too small a reward for the quality of the work they do for start-ups. Our ecosystem enables them to get additional upside as it aligns their payments with the growth of their customers at much lower risk than sweat equity.
We help Investors by removing the pain of building a highly curated, large and diversified portfolio of b2b/DeepTech start-ups and at the same time provide a well aligned and curated network of investors and experts to select and accelerate the development of DeepTech Start-ups.
The Technology:
- AI/ML & Deep Learning
- Quantum Computing
- Computer Vision
- AR/VR
- Blockchain infrastructure (no tokens, however)
The Location:
- EU
The Return Multiple:
We look for companies where we can help the management team generate returns of 5-10x minimum on our investment in 3 to 5 years
What, How And When We Invest
What We Invest
- We invest between £100k-£300k in a blend of cash and professional services expertise (i.e. we actually do the work, we don’t just advise, mentor or coach) in rounds valued at £200k to £1.5m.
How We Invest
- We look for ownership of 2% to 10% which grows according to the Sprint Financing (SF).
- We don’t take board seats by default, but the Start-ups we work with will be close to their assigned CV start-up partner(s) (typically an exited entrepreneur from the same industry).
- We don’t lead investment rounds; we follow and co-invest.
- We participate in Pre-seed, Seed, Pre-series A and Bridge rounds.
When We Invest
- Only when the Consilience Ventures network can de-risk and accelerate the business – we are operational and not purely financial driven
- When the product marketing fit is validated and/or where there is a clear path to reach it – we have the methods for both.
How We Think
Consilience Ventures’ core values are: Unified, Bold, Resilient, Purposeful, Agile and Authentic. We care about creating a better world and take long-term positions to increase our return on investment. Our network of investors thinks long-term. We don’t need to force you to exit if it’s not the right decision for everyone.
We are looking for the right blend of resiliency, persistency, determination, and the ability to listen to others. Founders’ values are aligned with the Consilience Ventures network. They like to think big and start small. They want to shape the world and reach financial security.
The best founders we have seen are obsessed with the problem(s) they are solving; they persuade and win over other people to care about the problem they are solving. They have worked long enough to know how to handle the team’s differences and how complementary their skill sets are. They know how to manage their ego. They see themselves as enablers, not disrupters.
Disruptors are people who look for trouble and find it. Disruptive kids get sent to the principal’s office. Disruptive companies often pick fights they cannot win (Peter Thiel in Zero to One – 2014).
Start-ups must know their competitors and know precisely what they do best or differently. No competition will be a red flag for us, but too many competitors could mean a race to the bottom. This can be countered by having a unique and a well differentiated product that drives substantial value to customers.
We invest in companies that participate in large markets. The Serviceable Obtainable Market (SOM) must be at least a several hundred million dollars, but the team must show how they intend to grow and dominate this market. They start small and seek to monopolize; Jeff Bezos’ founding vision was to dominate all of online retail, but he very deliberately started with books.
What We Don’t Invest In (don't waste your time)
Any of the following conditions will trigger an automatic "No" from us.
- Coins/tokens
- Round sizes greater than £1.5M (this is a hard limit. Our soft limit is $500K.)
- A valuation greater than £10M (another hard limit. Our soft limit is $3M.)
- Non full-time founders - even if they plan to become full time after funding. Again, this is a hard requirement. Even a single full-time founder is usually a "No".
- Companies that are not doing any real engineering or development of their own.
- Products or services which have a pure e-commerce sales model, e.g. a e-sports league, or an e-sports team.
- Businesses which operate in the following industries: gambling, pornography, sex, vivisection, alcohol.
- U.S.-based start-ups. Potential to grow into the U.S. is great, but they must be based in our target locations.
Consilience Ventures’ investment thesis will evolve with its network.
Last thing, we are continuously recruiting...