Nov 9, 2015 · 30m · 20vc
20 VC 086: Starting A New Venture Fund and How London Compares To The US with Hussein Kanji @ Hoxton Ventures
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In this episode of The 20 Minute VC, host Harry Stebbings interviews Hussein Kanji, founder of Hoxton Ventures, to discuss building a $40 million European seed fund, the evolving dynamics between European tech and Silicon Valley, and strategies for identifying high-growth venture opportunities.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 15.8% of the talking time here. How this is scored →
Harry as informed peer 2.1 Guest teaching 4.7 Guest disagreement 1.3 Harry pushing back 1.3
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 20:13 Premise rejection on European capital overhang
Guest directly counters host's suggestion that there is too much capital chasing deals in Europe, contrasting European seed scarcity with California density.
Hardest push from Harry ▶ 21:00 Host presses on London seed fund capacityHost holds his position following guest's pushback, immediately pressing whether London genuinely has room for multiple new seed funds.
Biggest teaching moment ▶ 6:04 Historical breakdown of European venture failureGuest educates host on why historical UK venture capital failed to scale, referencing Ron Cohen's book and Apex's transition into private equity.
Harry holds his own ▶ 14:14 Host cites US VC participation statisticsHost demonstrates strong market awareness by citing specific data regarding US VC funds leading Series B investments in London.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Hussein Kanji's Early Career and Transition to Accel Partners | 2 | 6 | 1 | 1 | Host asks introductory questions while guest delivers an extensive history of fund economics and the historical evolution of UK venture capital. | |
| Fundraising Challenges and Establishing Hoxton Ventures | 1 | 5 | 1 | 1 | Host prompts about fundraising hurdles, leading guest to break down the reality of taking 39 months to raise a first-time European seed fund. | |
| Silicon Valley vs. London Venture Dynamics | 3 | 5 | 1 | 1 | Host brings up US investment trends in Europe, while guest shares firsthand stories of Silicon Valley skepticism toward European VC investments. | |
| Maintaining Global Networks and Building Hoxton's Brand | 2 | 4 | 1 | 1 | Host asks about establishing a VC brand, and guest reframes brand equity as being derived purely from successful portfolio founders. | |
| European Seed Capital Scarcity and Venture Ecosystem Dynamics | 3 | 6 | 3 | 3 | Host asks if Europe faces capital oversupply, which guest politely rejects by contrasting London's capital scarcity with US market saturation. | |
| Identifying Emerging Markets and Venture Investment Theses | 2 | 5 | 1 | 1 | Host inquires about emerging thesis creation, prompting guest to clarify that entrepreneurs invent new markets while VCs merely spot pattern signals. | |
| Quickfire Round and Hoxton's Future Growth | 2 | 2 | 1 | 1 | Host moves through a structured rapid quickfire round covering books, advice, and acquisitions, which guest answers directly. |
Statements from this episode (15)
Kanji: Hoxton Ventures manages $40 million in its debut fund
“Following such success, Hussain set out to raise his own fund, and is now the founder of Hoxton Ventures, a 2013 fund with forty million under management.”
Hoxton Ventures' early portfolio includes Deliveroo, Darktrace, and Campana
“Despite Hoxton's age, their portfolio is immense, with the likes of Deliveroo, Darktrace by the famous Mike Lynch from Autonomy, and Campania, recently acquired by a twenty-four-seven customer.”
Kanji: Accel and Index are the best venture firms in Europe
“Axel's a great firm. I mean, it's probably one of the best in Europe, if not the best, alongside of Index.”
Kanji: Accel operates European venture funds exceeding $500 million each
“Axel's more than half a million, half a billion per fund, so 500 something plus Per fund.”
Kanji: UK venture pioneers Apax and 3i abandoned early-stage investing
“Apex became much more of a private equity firm than it became a venture firm. And three I became much more of a growth equity firm.”
Kanji: Global app platforms allow European startups to scale without geographic limits
“But once these distribution platforms became global, you know, the playing field completely changed, right? You put your app on top of the app store. It doesn't make a difference where you come from. You're going to get users all over the world. And Angry Bird…”
Kanji: Hoxton Ventures exited the J-curve within two years
“We're out of the J curve, which means we're kind of, you know, in the money now on, on the fund, you know, for a fund that's just going to become two years old in two weeks.”
Kanji: Two-thirds of London Series B capital comes from US VCs
“They're saying two thirds of all the money in, in, in London, at least in the tech community at the series B stage is, is now funded by American VCs. And when I say American VCs, I don't mean Accel in the UK. I mean, guys who are in the U S who are flying over…”
Kanji: Hoxton partners travel to Silicon Valley every six to eight weeks
“For us, we go there every, like, six to eight weeks, you know, you get back into the flow of information”
Kanji: New York raises in a quarter what London raises annually
“New York in an entire financial quarter raises as much money as London does in a year.”
Kanji: Hoxton Ventures co-invested in Darktrace alongside family office Talos
“Through a family office called Talus we bumped into Darktrace. And together, Talos and us ended up investing in Darktrace, and that clearly is turning into a cybersecurity winner.”
Kanji: Fintech startups are unbundling HSBC's website pixel by pixel
“You can basically take the HSBC webpage and start tearing it apart. There's a startup, you know, for every little pixel, right, on the HSBC webpage doing a different service. There's a startup going after them, right? It's a bunch of piranhas attacking, attack…”
Kanji: Founders must use social engineering to close seed funding rounds
“The best way to get any kind of round done is do the social engineering that you need to do to make sure other people in the market who are pretty well-regarded are talking you up, because that's the best way to get venture firms super excited.”
Kanji: Hoxton Ventures will remain a small, early-stage focused firm
“We're always going to be a small firm, but I think we can be a little bit bigger so that we can support our entrepreneurs the best way. But, you know, we want to be, I don't think we want to be a big firm. I don't think we want to be and doing growth deals. We…”