The Exchanges

Q And you mentioned incubators there. How effective do you see them as, uh, methods of deal, flow and deal sourcing?

A Yeah, I mean, it's, it's, it's, it's great for us because it gives us a way to Uh, connect with, uh, a, a large number of companies very quickly. And so, you know, there's some incubators out there right across Europe that are really sort of showing themselves as being fantastic feeders into not just angel investments, but, um, a series A and beyond. You know, guys, Seacamp, guys like, um, One Minute First here in London, um, and even sort of in the emerging areas in Spain, guys like Plug and Play and Seedrocker. There's some fantastic sort of places that are Really setting themselves out from the pack, um, and, ah, we think it's a great way for us to get, ah, a great deal sorted.

AI assessment note: “it's great for us because it gives us a way to connect with”

Q And I'd love to discuss one of your main focuses now, the enterprise software and security scene, a little. So, what cool stuff have you been seeing recently, and what kind of leads you to think that something is cool or exciting?

A Yeah, well, I mean, I spent a lot of time in enterprise and beta-bit, that's where I spent most of my time actually, and we already talked about APIs, and there's a huge amount to run still on that. I spent a lot of time looking at IT infrastructure, uh, and I think we're seeing some really cool stuff there and around sort of the Docker and container ecosystem. Um, so, you know, in the last 18 months, we've seen this huge shift for developers who would traditionally build their applications on, you know, traditional sort of, uh, virtualized machine, and we're now choosing to, to build on these much more lightweight and flexible containers, um, as the, as a shelter on their applications end. Uh, and this, this, you know, we're firmly convinced this is one of those rare sort of developments in IT infrastructure. There's sort of a generational shift, um, which has huge repercussions. I mean, this is similar to what we saw when sort of mainframes went to client server or the advent of cloud computing. You have these huge shifts, um, platform shifts, where there's a lot of potentially very valuable companies that are coming up in the ecosystem to sort of support this big platform shift. Uh, and that's really been the main driver between some of our investments lately here in the UK, like Cluster HQ and Weaveworks, uh, which are very exciting. Um, and then, then, then I also spent a …

AI assessment note: “I think we're seeing some really cool stuff there and around sort of the Docker”

Q How long do you like to know founders before making an investment for you?

A I mean, there's, there's always, there's always the occasional ones that come out of the, uh, the blue that we have never met before, and, you know, we, we can do a, uh, a deal in a couple of weeks, um, but I think overall, we probably know our founders for, you know, upwards of 12 months sometimes before we, uh, before we make an investment. It's, it's, it's important. You know, they get the chance to get to know us very well, and we get the chance to know them very well, and we see how things evolve over time. You know, we know very well that, This is never a straight line. It's always sort of moves in a big squiggle and there's always ups and downs and seeing how to see how a founder, um, operates over both the good times and the bad times in that period is fantastic for us to get to know how they're going to, uh, uh, operate, uh, when we make an investment.

AI assessment note: “overall, we probably know our founders for, you know, upwards of 12 months”

Q And you mentioned incubators there. How effective do you see them as, uh, methods of deal, flow and deal sourcing?

A Yeah, I mean, it's, it's, it's, it's great for us because it gives us a way to Uh, connect with, uh, a, a large number of companies very quickly. And so, you know, there's some incubators out there right across Europe that are really sort of showing themselves as being fantastic feeders into not just angel investments, but, um, a series A and beyond. You know, guys, Seacamp, guys like, um, One Minute First here in London, um, and even sort of in the emerging areas in Spain, guys like Plug and Play and Seedrocker. There's some fantastic sort of places that are Really setting themselves out from the pack, um, and, ah, we think it's a great way for us to get, ah, a great deal sorted.

AI assessment note: “great for us because it gives us a way to Uh, connect with”

Q And I'd love to discuss one of your main focuses now, the enterprise software and security scene, a little. So, what cool stuff have you been seeing recently, and what kind of leads you to think that something is cool or exciting?

A Yeah, well, I mean, I spent a lot of time in enterprise and beta-bit, that's where I spent most of my time actually, and we already talked about APIs, and there's a huge amount to run still on that. I spent a lot of time looking at IT infrastructure, uh, and I think we're seeing some really cool stuff there and around sort of the Docker and container ecosystem. Um, so, you know, in the last 18 months, we've seen this huge shift for developers who would traditionally build their applications on, you know, traditional sort of, uh, virtualized machine, and we're now choosing to, to build on these much more lightweight and flexible containers, um, as the, as a shelter on their applications end. Uh, and this, this, you know, we're firmly convinced this is one of those rare sort of developments in IT infrastructure. There's sort of a generational shift, um, which has huge repercussions. I mean, this is similar to what we saw when sort of mainframes went to client server or the advent of cloud computing. You have these huge shifts, um, platform shifts, where there's a lot of potentially very valuable companies that are coming up in the ecosystem to sort of support this big platform shift. Uh, and that's really been the main driver between some of our investments lately here in the UK, like Cluster HQ and Weaveworks, uh, which are very exciting. Um, and then, then, then I also spent a …

AI assessment note: “we're seeing some really cool stuff there and around sort of the Docker and container ecosystem”

Q How long do you like to know founders before making an investment for you?

A I mean, there's, there's always, there's always the occasional ones that come out of the, uh, the blue that we have never met before, and, you know, we, we can do a, uh, a deal in a couple of weeks, um, but I think overall, we probably know our founders for, you know, upwards of 12 months sometimes before we, uh, before we make an investment. It's, it's, it's important. You know, they get the chance to get to know us very well, and we get the chance to know them very well, and we see how things evolve over time. You know, we know very well that, This is never a straight line. It's always sort of moves in a big squiggle and there's always ups and downs and seeing how to see how a founder, um, operates over both the good times and the bad times in that period is fantastic for us to get to know how they're going to, uh, uh, operate, uh, when we make an investment.

AI assessment note: “we probably know our founders for, you know, upwards of 12 months”

Q Do you find that longevity of, kind of, return in how well you're doing tough?

A Ah, well, it's, it's, it's the ultimately long feedback loop, right? It's, it's, so if you're measuring yourself against that, you're not really going to know how well you're doing for many, many years. Um, so I think, You know, in the interim, I think, you know, the measures of success, at least that I use, are things like, you know, am I, you know, am I getting to, ah, the chance to work with founders that I think are doing really fantastic things, and that, ah, and with companies I think are genuine game changers. Ah, and, and, you know, on a personal note, am I enjoying working with these people and these founders, um, you know, and not just in the good times, because everyone has a great time when things are going well in a company, but also when things are going Badly. You know, am I still, you know, having a good time interacting with them? Could I still take them out for a beer, et cetera? Is there still a good relationship? And I think that's a great measure of success.

AI assessment note: “it's the ultimately long feedback loop, right? It's, it's, so if you're measuring”

Q Do you think the global outlook from the start is, is kind of crucial to their success?

A Yeah, yeah, I think it's a, I think it's a fundamental piece of it. I mean, ultimately, if you're building an enterprise software business today, you know, you, you want to become a global leader, it means becoming a leader in the US. Um, and, and a lot of that will follow from that. Uh, so having that outlook and, and, and focusing there from the beginning, I think is incredibly important. Um, but you know, and the UK is a bit different. I mean, we're, you know, we've got some great, um, uh, successes in cyber security here in the UK. So far, listed this year, it was the biggest ever UK, um, software company listing. And then there's this sort of other, there's this group of, uh, new entrants that are coming through with great momentum, like Dark Trace and Digital Shadows.

AI assessment note: “Yeah, yeah, I think it's a, I think it's a fundamental piece of it.”

Q Do you find that longevity of, kind of, return in how well you're doing tough?

A Ah, well, it's, it's, it's the ultimately long feedback loop, right? It's, it's, so if you're measuring yourself against that, you're not really going to know how well you're doing for many, many years. Um, so I think, You know, in the interim, I think, you know, the measures of success, at least that I use, are things like, you know, am I, you know, am I getting to, ah, the chance to work with founders that I think are doing really fantastic things, and that, ah, and with companies I think are genuine game changers. Ah, and, and, you know, on a personal note, am I enjoying working with these people and these founders, um, you know, and not just in the good times, because everyone has a great time when things are going well in a company, but also when things are going Badly. You know, am I still, you know, having a good time interacting with them? Could I still take them out for a beer, et cetera? Is there still a good relationship? And I think that's a great measure of success.

AI assessment note: “it's the ultimately long feedback loop, right?”

Q Do you think the global outlook from the start is, is kind of crucial to their success?

A Yeah, yeah, I think it's a, I think it's a fundamental piece of it. I mean, ultimately, if you're building an enterprise software business today, you know, you, you want to become a global leader, it means becoming a leader in the US. Um, and, and a lot of that will follow from that. Uh, so having that outlook and, and, and focusing there from the beginning, I think is incredibly important. Um, but you know, and the UK is a bit different. I mean, we're, you know, we've got some great, um, uh, successes in cyber security here in the UK. So far, listed this year, it was the biggest ever UK, um, software company listing. And then there's this sort of other, there's this group of, uh, new entrants that are coming through with great momentum, like Dark Trace and Digital Shadows.

AI assessment note: “Yeah, yeah, I think it's a, I think it's a fundamental piece of it.”

Q And talking in kind of hubs of innovation and technology, we've also seen huge amounts of growth in the Spanish startup ecosystem. So what do you think the catalysts or the main drivers are to a community, maybe not the Spanish, but a community growing, uh, exponentially in, in our vertical?

A Yeah, it's, uh, it's, it's funny, you know, that's one of the, been the big, one of the biggest revelations for me since, uh, joining Xcel is, you know, we always used to talk about these Primary tech hubs in, in Europe. You know, your Stockholms, your Londons, your Berlins, and then, ah, but what's been, what's been fantastic and really exciting is seeing these, what we used to, you know, think of as the secondary clusters, ah, really coming into their own. Places like Ireland and, and Denmark and Portugal and, and Spain. Spain's a great example. You know, we're really excited about what we're seeing down there now. I think if you go back 18 months, we had one Spanish investment, um, a company called Peer Transfer, ah, now Flywire. Uh, and, uh, fast forward to today, and, and we've backed four Spanish companies in the last 18 months. Um, we did Paclink, uh, uh, Wallapop, Fever, and now most recently KatoDB. Um, and so we're, we're hugely, and it's not like we sat down, you know, a year ago and said, let's go back a bunch of Spanish companies. We just kept meeting these great people on a holiday. I know. It does definitely has upsides to it.

AI assessment note: “fast forward to today, and, and we've backed four Spanish companies”

Q And talking in kind of hubs of innovation and technology, we've also seen huge amounts of growth in the Spanish startup ecosystem. So what do you think the catalysts or the main drivers are to a community, maybe not the Spanish, but a community growing, uh, exponentially in, in our vertical?

A Yeah, it's, uh, it's, it's funny, you know, that's one of the, been the big, one of the biggest revelations for me since, uh, joining Xcel is, you know, we always used to talk about these Primary tech hubs in, in Europe. You know, your Stockholms, your Londons, your Berlins, and then, ah, but what's been, what's been fantastic and really exciting is seeing these, what we used to, you know, think of as the secondary clusters, ah, really coming into their own. Places like Ireland and, and Denmark and Portugal and, and Spain. Spain's a great example. You know, we're really excited about what we're seeing down there now. I think if you go back 18 months, we had one Spanish investment, um, a company called Peer Transfer, ah, now Flywire. Uh, and, uh, fast forward to today, and, and we've backed four Spanish companies in the last 18 months. Um, we did Paclink, uh, uh, Wallapop, Fever, and now most recently KatoDB. Um, and so we're, we're hugely, and it's not like we sat down, you know, a year ago and said, let's go back a bunch of Spanish companies. We just kept meeting these great people on a holiday. I know. It does definitely has upsides to it.

AI assessment note: “we've backed four Spanish companies in the last 18 months.”