This guest post article, written by David Scanlon, first appeared in Linked In Pulse, on 30th March 2016.
Just over two months have passed since I joined NDRC as part of the Venture Investment Leader team: 8 intense weeks of getting to know my new colleagues (check), meeting the teams in our portfolio (ongoing), and figuring out where in the wide and weird spectrum of venture investment we belong (also ongoing).
Let’s be honest, early-stage investment is a crowded and oftentimes confusing landscape — founders can struggle to navigate through a slew of unfamiliar and difficult to differentiate terminology: incubator, pre-accelerator, accelerator, equity crowdfunding, angel, seed, VC, syndicate… (And once the founder has had a chance to draw breath, they’re potentially going to have to deal with a convertible note and grapple with caps, discounts, and other aspects of this uniquely convoluted, bistromath-worthy, funding mechanism). On top of this, the landscape is ever-changing: announcements of new funding supports land in my mailbox every other day, as corporates, governments, and a variety of other stakeholders lend their weight (and capital) to support entrepreneurship.
How does a founder choose which path to take? More interestingly, from my perspective, how does an early-stage investor differentiate themselves amongst all this noise? This is a question that’s front and centre for me and NDRC right now, as we currently have an open call for our NDRC Catalyser investment programme, and I’m out in the community discussing these questions with founders on a daily basis.
When I was with Enterprise Ireland, we always urged entrepreneurs to carry out their own due diligence on any potential investors. For founders, this can often be a struggle: you want so desperately to get the cash into your nascent business, it’s perverse to think that you should prod and poke at the people willing to invest in you — but, at the risk of looking a gift horse in the mouth, this is a vital step in the process. As an example from the opposite end of the spectrum, I had a chance to chat recently at Startup Grind with a late-stage VC on the process of raising a €300m+ venture fund. I questioned him about how he went about raising that kind of money, and he outlined a process that sounded an awful lot like an entrepreneur raising €30K. What’s the critical factor to focus on? Track record.
Which brings me back to NDRC Catalyser, and how founders can attempt to make sense of the world of early-stage investment. It’s all about track record. It’s all about the ventures that you’ve worked with: from the stellar successes that achieve exit within a few short years, to the projects that get honest, challenging feedback which you hope will save them from frustration and heartache. Track record is the most useful measure a founder has for assessing the true value of an investor; that, and talking to other ventures who have been on the journey ahead of them to understand which path to navigate. At NDRC, we’ve been at the forefront of early-stage investment for 8 years, investing in 180+ ventures to date. More than 52% of our portfolio raise further investment, and represent a market value in excess of €200m. But, to get a real sense of who we are, and how we help, you should do what I’ve found most helpful, which is to talk to a company in our portfolio. Then you can think about joining our family 🙂
If you’re a startup with deep domain expertise and novel technology that can be applied to a global unmet market need, then you should be looking at our NDRC Catalyser accelerator programme. We bring our track record, our award-winning experiential learning programme, six months in residence in our fab home in Dublin’s Liberties, and up to €100,000 investment via convertible loan. Interested?
Drop along to our Open Night on Thursday, March 31st to find out more, and hear from some of the teams who are currently sharing the journey with us.