The Exchanges

Q What does your team look like in each of the locations?

A So these locations, you have two partners. Typically the partners are like me, so they've built something great in that region. So if you go to Bangalore, for example, Rajiv Sistra is there. He built Urban Ladder, which is one of the most successful companies there. If you go to Germany, Alan Ponskin built West Wing, which is one of the most successful companies there. The people running these locations are very successful founders in that region before, which is necessary to attract the best Founders into that program. They also then have a team of about six to eight people around them, depending on the size of the locations. It's a team there that ultimately are focused on two things, which is finding the very best founders in the region, and then being a really good partner to them as they're just getting started.

AI assessment note: “these locations, you have two partners... a team of about six to eight people”

Q Why don't you take me all the way back to your upbringing?

A Yeah, so I grew up in Norway on the countryside on a small farm there, where we actually didn't have farm animals, but we had huskies. My father was a competitive dog sledger, so we had 36 huskies. Really in the middle of nowhere, lots of forest nature, was outside all the time. It's about eight kilometers to the nearest door. Then at some point, I got to hear about this school called United World Colleges, a high school where you can apply for a scholarship. It brings people together from all across the globe. I thought it was amazing to study with people from everywhere. So I applied for a scholarship, luckily got in, so I ended up doing high school in the UK with people from A to Two Nations. It's like a boarding school. We lived together for two years in an old castle. We did an international baccalaureate there.

AI assessment note: “I grew up in Norway on the countryside on a small farm there”

Q How do you go about taking a team of whatever is six to eight people and getting these 130,000 applicants for your program?

A Applicants come from many places. The best location to get applicants these days is through referrals. We have a founder community of about 7000 people now who refer people to us. We have an advisory network of about a thousand people. We have 2600 angel investors in our network. We have 3000 VCs in our network. And they tend to refer founders to us who are too early for them, or they believe are really strong founders, but they haven't really gotten started yet. So there's no kind of business to invest in. This is a tremendous Referral network. And by far, that's where you get strongest founders. The second place is we do outbound headhunting. So Index, for example, the entire LinkedIn database, we built a tool called Haystack. We pulled all the data we could from public sources, combine it with our own data on now more than 400,000 applicants and more than a thousand portfolio companies. And it literally gives people a score based on how strong a founder they might be. And we reach out to them, and we might reach out to them one or two or three or four years before they actually decide to build a business. They might be working in Stripe right now, they might be working in Spotify, but they'll receive an email from us saying, hey, congrats on building Spotify. If at some point in time you want to leave and build your own billion dollar business, we'd love to support you. And …

AI assessment note: “Applicants come from many places. The best location to get applicants these days is through referrals.”

Q So that team that gets that initial 250 K in the U.S., they're then leaving your offices. How do you go about supporting them once you've made that first investment?

A Once we made the first investment, they can actually still stay in our office for another two to three months, but it typically end up growing quite quickly. So they outgrow and get their own offices. They're still assigned the coach. So we check in with them more or less weekly. Typically what they need support with is in the early days, it's getting the product in the market, getting the first customer, sometimes hiring. We have a strong network of customers. We have strong network of advisors who can support on the product. And then Within a few months, they typically will raise their next round if they have a lot of momentum. Then we have this network of more than 3000 VCs and 2600 angel investors where we can make very relevant introductions. We also have many LPs who are interested in co-investing and we can make those introductions. So a lot of portfolio companies look at us as almost like a third or fourth co-founder because we can support with a system and a community on a lot of those things that are very important in the early days.

AI assessment note: “They're still assigned the coach. So we check in with them more or less weekly.”

Q As you have all these teams in the different locations doing the investing, what's the centralized activity that's building all the technology, sharing these best practices, and how does all that work?

A We have a global support team, which I lead, which is fully focused on creating leverage for the partnership. The most important thing they do is building technology. So we have a tech team of about 15 people who build out Antifusion, which includes the productivity tools I spoke about earlier, the data platform, but also crude tools for the founders, right? So we have their access to our investor database with all of the VC relationships and the angel relationships. So let's say I'm a health tech company in Africa that needs to raise my Series A. You can go in there and put in that criteria and out pops, okay, here are four of the relationships that Antler have. Who would make the introduction? Or do we have a portfolio company that have backed them? Can we make an introduction to them so we can create a competitive advantage in terms of funding rounds for our portfolio? There's the talent network I spoke about. It's the advisory network. There's the founder community. There's the perks platform. So we negotiated free credits with Microsoft, the store, AWS, Stripe, any type of platform or API an early stage startup needs to use. We can offer, for most of them, it's like almost a million dollars worth of free services. So all this is technology enabled. It's also what makes the data and the learning and the network effects work. So that's one part of the global support team. Th…

AI assessment note: “We have a global support team, which I lead, which is fully focused on creating leverage”

Q Sometimes when you think about starting a business, you think about passion or a need you're solving, there isn't really anything in your background to that point that would point to fashion. How do you think about what matters when you're going to start a new business like that in terms of the passion of what you're doing?

A We were very passionate about the opportunity, not the field itself, but it was just six hundred million people who didn't have access to Some of the biggest brands in the world, there was a big trend around Korean fashion at the time, which you couldn't really access anywhere. So it just felt like this obvious problem that someone would solve at some point in time. If you think about building an e-commerce company, whether it's fashion or any other thing that you're selling, the core product that you're selling is a very small part of the value proposition. What you're ultimately building is an executional machine. You're building logistics networks, payment systems, You're building back-end technology, discovery system. You need the best performance marketers in the world, and you're optimizing a funnel. The fashion part of it, we brought in people who are way more passionate and also way better at fashion than I am to ensure that we have the right products on the platform. Now, what made that particularly quite interesting is it combines a little bit of creativity with hardcore execution and technology. It was quite exciting that it wasn't Only tech and execution we're talking about, but also winning in the creative space and ensuring that we have the right people on the creative side.

AI assessment note: “We were very passionate about the opportunity, not the field itself”

Q You've now gone out and gotten all these applicants coming in. It's a huge number to process. How do you narrow the funnel to decide who's going to come into your cohorts?

A We use data to do this. It's a similar tool to Haystack, which automatically gives people a score. Now this program is pretty good at identifying really good people, but it's also giving a lot of false negatives. So you need to go through the reject pile because some of the very best people might be there. Because unfortunately, most AI models looking at assessing people these days, they're pretty good at finding specific types of people, but there's also just certain things it can't understand yet. So we use data to For the rest, people will fill in a self-assessment, do a personality test. For about 10% of the applicants, we do a 15 minute review interview, which is basically testing for a few very specific things. Is it the right time? Are they really serious about this? Do they have a spike? Do they have some of those criteria that we're looking for in a great founder? And subsequent to that, a few of those get selected for partner interviews. Then we do two one-hour partner interviews. And after that, we select the top two percent. Throughout that entire funnel, we're looking for spikes. We want to see something in the founders that are better than most other people. We're looking for drive, which is a combination of ambition and having shown the ability to execute. And we're looking for grit, meaning there are people for whom failure is not an option. A little bit like I …

AI assessment note: “For about 10% of the applicants, we do a 15 minute review interview”

Q How do you decide how much capital to put in at that stage?

A The capital is predetermined, so that's quite important. So once we select founders to join the program, we already sign an option agreement with them that we can invest a certain amount of capital at a certain valuation. Now that is important because very often after a while they've been in the program and they're moving forward very fast, there's a lot of other VCs coming and knocking on the door. So we've already secured our investment rights. So for example, in the US, we invest then In cash for about nine percent equity. And then we put in another 250 K commitment for their follow on round in total of 500 K commitment, but 250 K coming in up front. And it's only us doing that round. This is the one thing that we're focusing on being the best at finding really exceptional founders and being a great partner to them in the early days. And we obviously follow on as well, but the core to our returns is that process.

AI assessment note: “The capital is predetermined, so that's quite important.”

Q How do you think about, in the case of these lessons, measuring outcomes? Because you're investing at the early stage, it's a long time before you'll ultimately know if there's success or not, yet you're drawing lessons to say, have we had better outcomes or worse outcomes based on a sample of a month or three months?

A We looked at around 36,000 startups and then leading indicators for how they ended up succeeding. So this is all public data. And then we looked at our own data where we had around 400,000 applicants so far, more than a thousand portfolio companies. And we looked at what are leading indicators that leads to specific outcomes. And obviously it's something we get smarter on every day and we'll get smarter and smarter as our data set increases. I think we add now millions and millions of data points every year. A current hypothesis that the 10 most important things broadly split in three categories are, one, the quality of the scouting funnel, two, the quality of the portfolio, which is more lagging indicators, and then three, operational indicators. If you look at the quality of the scouting platform, there are four things that really matters. A, application volume, which is more actually to do with the momentum. So if in New York you get 5000 applicants for one court. The next court, you get 4000 applicants. That's an indicator of the whole system possibly being less popular. So you want to see a growth in the number of applicants, at least up to a certain peak. You want to see a share of experienced founders being high. For us, experienced founders are founders who made it to series A or series B or made it to a certain amount of revenue. They don't necessarily have a massive I…

AI assessment note: “we looked at what are leading indicators that leads to specific outcomes.”

Q And then how did you decide what to do when you're involved in these startups, but you're also just coming out of college at the time?

A We actually exited the two that we started over there. So it was two small exits. We started another one, which was a property investment company, which was literally just investing into properties. That one we kept for a few more years, but I was very focused on continuing my learning journey. I've become very interested in technology, but at the same time, I've been in high school and full scholarship. Then I was in the military for a few years, which is not the greatest pay in the world. And then I was in college also at the Full scholarship. So I decided to go out and get a full-time job. So I joined McKinsey because I want to work with tech companies all across the globe. And at the time I joined, I was working in Europe at the beginning, but then quickly in such an organization, when you become an expert on the topic, you are in demand all across the globe. So I worked in Europe, I worked in the US, I worked a lot in Asia with everything from deep tech companies to the consumer side of things. So the whole value chain and got to see it across Asia, Europe, And the U S and that was a tremendous learning journey. So I was there for five and a half years after college.

AI assessment note: “So I decided to go out and get a full-time job. So I joined McKinsey”

Q There's a lot going on here. 27 regions. You just crossed a thousand companies you've invested in. You're talking about multiple thousands of potential partners of the venture capitalists down the road. How do you keep track of everything so you can continue to make good decisions about funding in later stages?

A Technology is critical. We built a technology platform, which means that we get stronger the more nodes we have. We built a partnership structure where We get stronger the more great people we have in the organization. So scale for us becomes a strength instead of creating complexity. Now, how do we do that? A is data, right? So we're very data driven. So we track founders even before they applied. They visit our website. They do this. They read the newsletter, wherever it is. Then we track them through the application funnel. Then we work with them in person. Then they're part of the portfolio. We gather data an entire way when you use that data to optimize decision-making, optimize the funnel. The other is In lack of a better word, you call them kind of productivity tools, which is ensuring that the scouting process, the programs, the ICs, everything is run on the technology platform. So if I go and do a coaching meeting where I take my coaching notes, I was on Antlefusion. If I do an IC, it's in Antlefusion. So in that way, things are done in the same way everywhere. And then scale becomes an opportunity for you to learn. So when we run 27 locations in parallel, that's 27 years worth of learning in one year compared to just running one location. If you capture that learning, and if you use it to improve your processes, we can test out things in that way quite rapidly. So we …

AI assessment note: “We gather data an entire way when you use that data to optimize decision-making”

Q You've scaled this quite a bit in just the last six or seven years, and you're talking about growing the applicants in your cohorts. I'm curious, what are your objectives and where do you want to take this over time?

A We want to be singularly focused on one thing, which is being the best partner to great founders all across the globe as they're just getting started. And that means finding the best people and have access to the best people through being their best partner, which is then what we do In terms of supporting our portfolio. So we're constantly working on optimizing on that, learning that, and we'll scale that a little bit, right? We can make a few more investments per year in New York. We can make a few more investments per year in Bangalore. There's a few more cities we might launch like Tel Aviv, West Coast of Africa, a few more cities in the US and so on, but it's not that many more locations, right? So very much now it's focused on the core, making that better and better, increasing selectivity. I ultimately believe that if you're very focused on doing one thing really great, that's how we can deliver systematically better returns. And the other thing we're doing from a capital perspective is becoming more of a full stack investor. So I mentioned earlier, we have a separate strategy where we now invest up to series C. And the way we structure that up is also very much to create system values. So one is for the founders. So if I come to you as a founder and I say, Hey, I can put up to a million dollars into your business over two rounds. That's obviously attractive. But if I com…

AI assessment note: “We want to be singularly focused on one thing... becoming more of a full stack investor”

Q Which two people have had the biggest impact on your professional life?

A There's many. Lately, Larry Summers on our board has been very impactful, particularly since obviously we've built this thing through a very interesting time, right? We launched in 2018, then we had COVID, then we had 20 21 peak, then we had hyperinflation, there's been wars. He's consistently been there, very meaningful advice, particularly also when it comes to the macroeconomic environment. And I asked him this other day, what do you think should be the main focus of the platform going forward? And he said, hey, sometimes you should just think about What is required for you to be there in 20 years? If you're there 20 years from now, compounding, adding to your platform, adding the learnings that you're doing today, it's going to be incredible business, and it's great to think of that long-term view. So it's been very impactful lately. My time in McKinsey was very impactful. Working with Dominic Barton, who was also on our board in the early days, used to run McKinsey for eight years, and our chairman, Tore Muralt, used to be the leader of the senior partner election committee, and used to run Europe. Just in terms of set one clear focus for the organization. For McKinsey, that was clients first. For us, it's founders first. We always think about having a founder in the room. If we make a decision, will it make it better for the founders or worse for the founder? If we have g…

AI assessment note: “Lately, Larry Summers on our board has been very impactful”

Q What was it inside you to that point that you think allowed you to have that mental fortitude to succeed through that process?

A The most important thing when you grow up, the most important thing I think about when it comes to my own children, at some point of time, it's important to get inspired by something. It's also one of my favorite books is Man's Search for Meaning, where They were looking at people in the concentration camps during the Second World War, and what made some of them able to survive these horrible conditions for a long period of time, and it was very related to having a purpose. Having a purpose early on in life is incredibly important to build an inner engine, and if you expose your children to opportunities where they can get that inspiration, that's one of the greatest gifts you can do as a parent. And my parents did that in various ways, and at some point in time, You never know when it will happen. But for me, it happened when my great grandmother died. I started thinking about life and death and so on at a quite early age. My father come from a more communist type upbringing. He believed you live and then you die. And he gave me a number of books, including Franz Kafka, which was very hard to read at that point in time. My mother is more spiritual. And in the end, I started thinking a lot about what do you want to accomplish in life in an early stage and got inspired to make a small difference. Because I lived, and I think that part was very important when I did the military t…

AI assessment note: “Having a purpose early on in life is incredibly important to build an inner engine”