Evan, who is taking part in Startupbootcamp’s Tea With A VC event, has worked in startups and venture capital on both sides of the Atlantic and shares his firm’s Silicon Valley-style investment ethos as well as tips for fundraising founders…
Tell us about yourself. How did you get into Venture Capital?
I was fortunate to have early exposure to entrepreneurship. My father’s a physician but he struck out on his own to start a remote sign language interpreting business when I was 11. He also introduced me to a hacker friend of his who showed me the magic of code at a young age. Having a starting point in technical development gave me a deep respect for product and code quality.
During high school, I worked for two early-stage startups part-time: my father’s business and the men’s email newsletter Thrillist, which later scaled to over $100 million of revenue. After a business undergrad and masters in computer science, I moved back to New York to join Insight Venture Partners – a growth equity firm focused on technology – where I spent two years.
In 2014, a friend introduced me to Simon Levene who, alongside two old friends, was starting a new kind of venture capital firm. A month later I jumped to London to help launch Mosaic Ventures.
Tell us the founding story of Mosaic Ventures.
The friendship of my partners Mike, Toby and Simon goes back 21 years to a camping trip in the Yosemite backcountry. Fast-forward to 2014 after decades of operations and investing, they saw an opportunity to serve founders at the Series A stage across Europe, with a Silicon Valley mindset.
What does it mean to be a ‘Silicon Valley-style’ venture capital firm?
It means that we’re less focused short-term revenue and more on backing entrepreneurs who are looking to swing for the fences and build something of tremendous value. To change entire industries as opposed to iterative efficiency improvements. We’re willing to look at businesses less with the eye of an investment banker purely focused on financials.
How many companies have you invested in so far and how much do you invest?
We’ve now backed 16 companies, with most of our investments being at the series A stage. Occasionally we’ve invested a bit earlier or later when we’ve had a long-standing relationship with the entrepreneur.
We invest from €1 million to €7 million as the first cheque. As we look to do follow on rounds, we can invest north of €15 million over the lifetime of an investment.
Do you have a particular industry focus or are you more interested in the idea and the entrepreneur behind it?
We focus on software and internet-enabled businesses. About half of our investments have touched FinTech, and we’re looking particularly closely at digital health, mobile, SME SaaS and marketplace businesses.
If we meet an entrepreneur who has a fresh perspective about an industry, even one we previously haven’t been particularly excited about, we’ll certainly back them.
You say that you’re mainly a European fund – apart from the UK where else have you invested or looked for investments?
More than half of our investments come from the UK and Germany, but we’ve also invested in France, Israel, and a couple of distributed teams. We’d like to be investing more in the Nordics and Southern Europe as well.
Do you typically lead the rounds or do you co-invest as well?
We do both. In some cases, we co-lead investments with US investors. One unique thing we bring to the table for European startups is that we will actively make introductions to the best US firms for that specific business and co-invest alongside them.
Over the past two years, we’ve co-led deals with the likes of True Ventures, Union Square Ventures, and Lightspeed Venture Partners.
Do you personally focus on certain industries if you’re working with the startup founders directly?
We believe specialization adds value to founders. I’ve been spending 50% of my time over the past few months looking thematically at logistics and temporary staffing businesses. Each of us tries to focus on 1 or 2 themes per quarter, but we’ll invest in educating ourselves quickly on a new market if we come across a superb founder.
What are the top three things you look at when considering a new investment?
The main thing I look for is an empowering founder(s). Someone who can drive towards a huge vision and enjoys being challenged. I want to invest in someone I’d want to jump out of bed in the morning to work for.
Second, we’re looking for an attractive market, which can include a market that isn’t yet large but that has the potential to expand over the coming few years.
And lastly, we’re looking for companies that are willing to take more risk, swinging for the fences and building a strong foundation for long-term growth.
There’s a constant comparison between the US and European VCs, but have you noticed any differences between American and European founders in your experience?
It’s difficult to put European founders in one box, but some European entrepreneurs are more understated versus their American counterparts.
In terms of golden rules, are there certain hurdles a founder has to pass when you’re evaluating potential founders or companies to invest in?
We look to invest in founders who are so ambitious that even if they get a generous offer they’d be willing to refuse it in order to build something much larger in potential and impact.
Another golden rule is that we care deeply about why a founder is starting a business. To us, that needs to come from a genuine desire to change a market, more than just a way to make money.
From a founder perspective, what advice would you give to a founder fundraising for the first time?
Don’t treat fundraising as a silver bullet i.e. “raising a round of financing will help us with our issues”.
It’s also important for founders to know and trust the partner they’re going into business with. An investor/entrepreneur relationship will hopefully last many years, so don’t rush it just to get it over with.
What advice would you then give in terms of knowing if an investor or a firm is right for the founder?
I think all entrepreneurs fundraising should take the time to closely reference both the firm and the partner who’s working on the deal.
We’re very proud to offer up any of the entrepreneurs we’ve previously backed to talk to new prospective investments.
Mosaic Ventures recently organized an event at Shoreditch Townhall featuring YC’s Sam Altman. Is attending events the best way founders can meet you and the Mosaic Team?
Larger events aren’t the best places to get to know one another. One-on-one is ideal, preferably through an introduction by someone whose opinion we trust.
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