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🧬 Traits of great founders, according to GV’s Tom Hulme
Founders Factory Startup Bulletin #22
Welcome to the Founders Factory Startup Bulletin—“Created for founders, by founders”.
Each month, we bring you a round-up of startup and investment stories, key learnings from founders, and insights from the Founders Factory team.
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There’s a great quote about Warren Buffet, and how his success has compounded over time—“His skill is investing, but his secret is time.”
Time is a luxury in the world of startups. For entrepreneurs, time is a scarce resource: especially at an early stage, when you’re juggling dozens of tasks and only have so many hours in the day. Funding buys you more time, but only if you know how to deploy it correctly.
For investors, time gives you perspective. Tom Hulme’s time in the game has given him the great benefit of perspective. Not content with starting two businesses of his own, Tom has established a reputation as a leading VC as Google Ventures’ (GV) Head of Europe, as well as an active angel investor. His biggest wins include Nothing, GoCardless, Multiverse, Snyk, CurrencyCloud, Vaccitech, and Lemonade.
In this month’s newsletter, Tom shares his perspective from the founders he’s invested in, and what traits he thinks lead to success. Also in today’s newsletter:
Our top recommended reads
Highlights from our portfolio this month
Opportunities, events, role hiring
📣 Before we start—shout-outs
I’d like to start by shouting out our top referrers this month. First of all, Kieran Witt, founder of proptech startup Kotini, who are bringing together everything you need to buy a house under one platform. Secondly, Aleksandr Volodarsky, founder of Lemon.io, a platform connecting businesses with software developers.
Refer the Startup Bulletin to your network:
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🧬 GV’s Tom Hulme: What are the traits of great founders?
This month, Tom Hulme shared his insights from the world of venture (as a founder, investor & angel). Here are some excerpts from what he believed contributed to founders’ success
⏰ They operate at a fast enough clock speed
On the topic of time, this is a very relative concept for each entrepreneur. For example: two years for a native app is a long time, as you can release new features on an almost daily basis. That’s an awful lot of testing and iterating. Conversely, two years for a nuclear fusion startup is just a quarter of an eight year cycle.
So instead of thinking about time or ‘runway’, I’d like to see founders talking about their clock speed. Specifically, the rate at which you can deliver products, test, and iterate on these.
As an investor, I’m always looking at a founder’s clock speed. I want to know if they’ve had enough shots on goal to have sufficiently tested and validated their product.
🧠 They’re discerning about who they take money from
Capital is scarcer today than it was 18 months ago. That said, founders should still be savvy around who they take funding from.
The key principle is this—cash is a commodity, it's fundamentally the same from any two investors you accept it from. The difference is the investor who is giving it to you. Is this person going to be a strategic value-add to your business? Are they able to provide the support or connections that will help you succeed? And do they feel like they have a stake in your success?
This is particularly important with angel funding. Angels come in all shapes and sizes, so you want to be discerning around who will help take your business forward.
👂 They’re relentlessly customer centric
Founders can easily make the mistake of obsessing over their product, and ignoring the ugly truth—that, even if your business does survive, there’s an extremely small chance it will look anything like it does at a pre-seed stage.
That’s why, when I’m speaking to founders, I’m less concerned with the ins and outs of their product, and more about the founder themselves. How are they thinking about the problem? How much empathy do they have for the end customer and how willing they are to modify their assumptions?
Giving a damn can be the best performance enhancer.
🔎 They can find opportunities amid a crisis
I’ve written on my blog about the Chinese word ‘weiji’, meaning crisis. It combines the two Chinese symbols for ‘danger’ and ‘opportunity’. Founders who can find the opportunity and avoid the danger will be rightly rewarded after the current down market passes.
For instance, while the fundraising market is certainly hugely challenging at the moment, it also presents novel opportunities for early stage founders. I’m seeing more late stage VCs (growth) investing in pre-seed/seed as a way to keep their firms ticking over without investing too much capital. This is a chance for seed stage companies to talk to hugely influential VCs who otherwise wouldn’t have replied to their emails.
📚 What we’ve been reading
ChatGPT is a blurry JPEG of the Web (The New Yorker)—science fiction writer Ted Chiang shares his view on this year’s biggest innovation, and risk of recycling existing information
The New Gatekeepers (Benedict Evans)—Evans shares his annual presentation on macro and strategic trends, this year exploring changes in the world of commerce
Pivoting into Web3: LandVault CEO Sam Huber (Founders Factory)—Sam shares his journey from Formula One to in-game advertising, and the details of his pivot last year into Metaverse land developing
First 1000: Canva (First 1000)—read the story of Canva’s growth from graphic design tool to unicorn
💸 News from the Founders Factory portfolio
The LGBTQ+ Founder Report, led by Proud Ventures in partnership with Founders Factory & Investec, was launched as the first report of its kind sharing data in LGBTQ+ founders in the UK
Mo.Health (formally known as Mosaic) launched their rebrand. They’re building a novel approach to employee health insurance with a community trust fund model
🗓 Opportunities in tech
Hiring (at Founders Factory + our global portfolio)
Product Designer, Founders Factory
Entrepreneur-in-Residence, Project Chiron (chronic health management platform)
What are the next big opportunities in fintech? (March 28th, 6pm-9pm, London)—we’re hosting this event in partnership with Stripe, with a panel featuring people from Stripe, Aviva, Notion Capital, and Built AI. Apply to attend here
NEF+ is launching its next intake (commencing April)—NEF+ is a six-month learning, mentoring, and networking programme for entrepreneurs. Apply here by end of March
Founders Angels (June 14th)—we’re joining forces with Founders Forum to host this inaugural event for angel investors. This event will bring together 100 top angel investors for an afternoon of networking, pitching, and panel discussions. Angels—if you’re interested in attending, contact firstname.lastname@example.org
See you next month 👋