Insights from Top Accelerators - The Family

The Family nurtures entrepreneurs through education, unfair advantages and capital. Moving at startup speed, The Family is transforming a portfolio of non-linear companies, special projects and virtual infrastructures into a connected community of entrepreneurs, operators and fellow investors who inspire and support each other.

Pietro Invernizzi looks after Dealflow at The Family.

You’re used to being on the receiving end of startup pitches, how would a reverse elevator pitch of The Family sound like?

Pietro: The Family is a long-term strategic minority investor that empowers startups through education, unrivalled networks and access to capital. As an entrepreneur, don’t expect an x-month programme packed with lessons and mentorship sessions, but rather see it as joining an infrastructure of more than 150 European companies that share your level of ambition, supported by our 30-person team dependent on your needs.

What you take from The Family depends on you: you ask and we help, making sure the best of the European ecosystem is available to you at any time for the long term. As one of our founders beautifully put it, The Family is a decentralised infrastructure for your next big thing in Europe.

From your experience, what do companies tend to value the most after they become part of The Family?

After several conversations with our founders, it seems that the real value of The Family lies in the mindset we are able to transfer to them. If we were to simply provide advice on what to do, the entrepreneurs we help would build average startups. Instead, we encourage founders to take their own decisions and then push them to pursue them as quickly as possible. If those decisions were wrong, at least they’ll realise quickly and adjust their path accordingly.

Information on best practices can be found everywhere – what we provide is the right means to get there.

You get to observe a lot of patterns by working with Europe’s most exciting startups. What elements distinguish the most successful companies from those that stagnate?

It’s funny you ask this – I spent the last month travelling around Europe with my teammates, Emilie and Lorenzo, meeting with the founders of our ten most successful startups, trying to find out exactly that. The aim was to be able to improve our initial startup screening. We all came to the same conclusion: you cannot retroactively figure out the unifying qualities of successful founders. Instead, this is what we noticed.

As long as you are friendly, your personality traits do not matter. It’s not about whether you are rather shy, overconfident or have your head in the clouds. Every personality can lead to a success story within The Family.

Incredible obsession over your field is a must, even when your field seems boring to most people. (Yes, even payroll, trucks and so on…) Whatever it was, these entrepreneurs were desperate for their solution to exist. We want to find geeks in all verticals.

And resilience. Hard to say if it’s innate or acquired, but we could easily imagine each founder meditating in a hurricane.

Accessing different markets is instrumental for scaling up European startups. What are some of the easily avoidable mistakes that young startups make when going international?

The mistakes we see the most at The Family are:

• Founders managing too remotely or not moving/living in the newly launched country to better feel/see what’s happening and lead the business team – at least at an early expansion stage
• Not assessing local specificities (i.e. market, regulations, hiring, unit economics, customer expectations) enough to be able to adapt and execute the original playbook locally
• Not investing enough: being too shy to put whatever it takes – including budgets – to the test, fail and readjust along the way
• Not testing local-based online acquisition enough to determine the best countries/opportunities before proceeding with expansion (if applicable)

Support with investment readiness is a key value-add of acceleration programmes. As you focus on dealflow and fundraising, what are your Top 3 fundraising tips?

I will give you one tip per fundraising stage (I also published my Top 10 fundraising tips in this Twitter thread):

• During a pitch meeting: don’t rely excessively on your pitch deck. A meeting should be a relaxed conversation. Investors see hundreds of decks per week – once they meet a founder, they want them to be a human deck. Walking investors through a pdf they’ve already read is boring and portrays insecurity
• After the first few meetings: if your meeting went well, great. Don’t celebrate – go meet even more investors than you were planning to. The higher the level of competition around your deal, the higher your optionality, and the higher the potential for a successful next round further down the line. Additionally, don’t weigh your efforts based on how badly you want an investor to be your partner. Until you have term sheets, their reactions shouldn’t mean much to you. Some may act super friendly but not like your project, while others might do the opposite. Read people post term sheet
• After all stages of meetings: if you’ve been to many meetings and none went well, stop. You’d rather kill your current unsuccessful round now and find hacks to survive and raise stronger later than get the reputation of a startup incapable of raising or raising with bad investors out of despair

The Family works with founders over the long term. What is the secret to building long-lasting relationships?

This can easily be answered in one word: trust. In order for a founder to provide us with a small equity stake in their company, they need to be able to trust we’ll be there to support them over the long term. This is why we give founders a one-year cliff to decide whether our model fits with the way their company works and with their culture. If they don’t think so, they are free to take the equity stake back as if nothing happened within 12 months of working together.

Additionally, by not being a fixed three-month programme packed with mentorship sessions and a schedule to follow, we leave it in the hands of the entrepreneurs to come to us when they need to. For this to work, the level of affection and trust needs to be high on both sides. You can see it when our Co-founder Oussama lets a founder access his emails to send investor intros on his behalf, or when founders in legal trouble call our CEO Alice on her mobile on a Sunday.

What areas of innovation do you find the most exciting at the moment?

Electric scooters!! Am I late? ;)

On a serious note, at the moment it’s the area of innovation around employee retention and engagement. Companies attempting to solve their issues do not seem to be succeeding yet: budgets for HR have grown constantly in recent years and hiring talent is always a top concern for CEOs/founders. Yet, employee engagement hasn’t moved in 20 years.

The main tendency to try and solve engagement issues is to put managers in charge of the problem. This does not seem to work: most disengaged employees leave companies because of their manager and not because of the job itself. I am excited by solutions like Sidekick that put the individual at the heart of the problem. I believe that, with the right amount of support, communication and feedback, employees can be coached to get the best out of their managers and make their life at work much easier.