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The Shopify of Venture Capital · EU-Startups Podcast

• 0:00
  Speaker 1: You are now listening to the EU Startups podcast.
• 0:13
  Speaker 1: Hello, and welcome to this episode of The EU Startup Podcast.
• 0:16
  Speaker 1: as always I'm your host Dave Senangarcia, the editor at EU startups.
• 0:20
  Speaker 1: today i chatted with Patrick Ryan.
• 0:23
  Speaker 1: he's the co-founder of the VC platform Odin.
• 0:28
  Speaker 1: Now for those view that don't know odin their whole idea is launch a VC investment vehicle from an app from your pocket.
• 0:38
  Speaker 1: They've compared themselves to Shopify for investors, and the idea is that they're trying make access more boutique firms or investment vehicles.
• 0:52
  Speaker 1: They have specific networking abilities when it comes to the UK, Europe and even the US.
• 0:59
  Speaker 1: And they're constantly trying to expand an even democratize this access to funding.
• 1:04
  Speaker 1: so much from European founders to American founders, European investment vehicles to American investment
• 1:11
  Speaker 1: vehicles.".
• 1:12
  Speaker 1: So we were able to chat about all that—the thesis behind The Company how it initially began... How he sees a distinction between American funding versus European funding, the difficulties when it comes to innovation and scaling companies.
• 1:30
  Speaker 1: We even were able go off-script a little bit in chat about how he sees that journalism landscape when it come to innovation tech reporting—that's my fault because this is an obvious interest of mine but I think all tied together nicely.
• 1:46
  Speaker 1: so hope you're looking forward.
• 1:50
  Speaker 1: Hello Patrick, and welcome to the EU Star Wars podcast.
• 1:53
  Speaker 1: It's a pleasure finally have you on after so many weeks of back-and-forth trying get a slot in for ya.
• 1:59
  Speaker 0: Yeah we've been Europe maxing I suppose enjoying our summer.
• 2:03
  Speaker 0: maybe too much Good to see David.
• 2:07
  Speaker 1: Yes yes no i'm very happy to have you here actually been keeping tabs Odin on yourself ever since I initially pitched you just because I see.
• 2:16
  Speaker 1: You've got your doing podcast episodes now Yourself, if you're getting people on.
• 2:20
  Speaker 1: so so you are very experienced already?
• 2:23
  Speaker 1: I can tell as
• 2:24
  Speaker 0: a On the media side of things
• 2:27
  Speaker 1: Exactly fellow podcaster yeah So this will be smooth i'm sure.
• 2:31
  Speaker 1: um before we get into kind Of The talk that We have planned for you today i was hoping That maybe you'd introduce yourself what odin is As i've Already mentioned and A little bit of background as to What do.
• 2:42
  Speaker 0: Sure, so I'm Patrick Ryan co-founder of Odin
• 2:46
  Speaker 2: and
• 2:46
  Speaker 0: Odin in short is a way to run your investment firm on your phone.
• 2:51
  Speaker 0: So we work with VCs angel syndicates starting to work more private equity firms as well.
• 2:57
  Speaker 0: We've got about two hundred two hundred fifty customers mainly in Europe And then increasingly the US as well some in Asia.
• 3:05
  Speaker 0: An analogy for people maybe less familiar this industry.
• 3:08
  Speaker 0: it's like what Shopify does for e-commerce.
• 3:10
  Speaker 0: We kind of do that venture capital, right?
• 3:12
  Speaker 0: So it's kinda like Shopify for VC.
• 3:14
  Speaker 0: we make really easy to focus on your relationships with the customers who are founders in investing side and investors or LPs on the investor side.
• 3:25
  Speaker 0: uh...we take care at back office.
• 3:26
  Speaker 0: admin.
• 3:27
  Speaker 0: things like compliance you know KYC and AML certain elements of the regulatory side of thing payment processing things like fund accounting all the boring stuff no one wants to deal with.
• 3:40
  Speaker 1: Well, so how did this come about then?
• 3:42
  Speaker 1: Because it originally caught my eye and reason why I even invited you on it because that's okay.
• 3:47
  Speaker 1: well its a bit different than normal kind of investing routes.
• 3:51
  Speaker 1: i'm used abnormal too.
• 3:55
  Speaker 1: We actually share a participation in Irish Embassy, I was in Madrid.
• 3:59
  Speaker 1: you were in Russia from what i saw.
• 4:01
  Speaker 1: yeah you had a vodka brand as well so kind of... You've had a varied path here to land on this investing path that your own.. So how did these come about?
• 4:15
  Speaker 0: Yeah if we think abut it and the abstract for me its just like How do set capital free into innovation economy more efficiently and in the way that it can deliver most value.
• 4:29
  Speaker 0: I studied Russian and French at university, so not finance or economics or anything like that but... Good buck!
• 4:39
  Speaker 0: It's intentionally quite a broad choice i think.
• 4:43
  Speaker 0: you learn about people culture.
• 4:49
  Speaker 0: we also study literature philosophy stuff.
• 4:53
  Speaker 0: The Anglo-Saxon education system allows you to study quite broad things and then end up working in something different.
• 4:58
  Speaker 0: It's not so specific, maybe some of the places dictate... I started my career there in consumer goods actually.
• 5:07
  Speaker 0: So i worked for a french company called Pono Ricard who own a bunch of irish whiskey brands.
• 5:14
  Speaker 0: I grew up in England.
• 5:15
  Speaker 0: My family is all Irish.
• 5:17
  Speaker 0: So basically, James and Whiskey worked for them in France.
• 5:23
  Speaker 0: I then worked the Irish Food Board under the ages of The Irish Embassy in Russia And also an organisation called Enterprise Ireland
• 5:36
  Speaker 2: who
• 5:37
  Speaker 0: is basically a trade department abroad For Irish companies.
• 5:42
  Speaker 0: you work with small businesses... ...I really liked working with small companies Wanted to start something I knew food and drink.
• 5:48
  Speaker 0: so i was in Russia.
• 5:50
  Speaker 0: this is before.
• 5:51
  Speaker 0: You know the current kind of geopolitics were playing out.
• 5:55
  Speaker 0: so, I thought there's an opportunity make really high quality vodka in russia.
• 6:00
  Speaker 0: craft spirits which are becoming more than thing started that business basically making a rush or bring it back to the UK.
• 6:09
  Speaker 0: Exporting vodka from Russian Europe wasn't experience but i wouldn't recommend it.
• 6:16
  Speaker 0: I actually crowdfunded to get that business off the ground and then it got interested in small-business finance through there.
• 6:22
  Speaker 0: That business never really got going,
• 6:24
  Speaker 2: um...
• 6:25
  Speaker 0: And i wasn't super passionate about it but it kind of opened my eyes to okay how a business is financed?
• 6:32
  Speaker 0: How start up's
• 6:33
  Speaker 0: financed?".
• 6:34
  Speaker 0: And I ended working for company called Crowdcube In The UK who are an equity crowdfunding platform.
• 6:41
  Speaker 0: Through that I began think more broadly like venture capital.
• 6:46
  Speaker 2: And
• 6:47
  Speaker 0: it struck me when I looked at what we were building a crowd cube that VC firms, Angel syndicates other people who had access to very high quality opportunities weren't using great technology.
• 7:00
  Speaker 0: So I kind of thought hmmm... That's interesting!
• 7:02
  Speaker 0: I ended up leaving Crowdcube but did some consulting work in corporate venture for Coca-Cola European partners so kinda the intersection consumer goods and Venture and then started noodling on this idea for Odin.
• 7:19
  Speaker 0: We'd looked at what Angel list we're doing in the US, there was also a platform called Vobam In The UK which has since been acquired by Carter.
• 7:28
  Speaker 0: I don't know if you've ever had Remy or Ulrich On the podcast but they are good guys.
• 7:35
  Speaker 2: And
• 7:36
  Speaker 0: it kind of struck me okay?
• 7:36
  Speaker 0: There's need For something like This in Europe.
• 7:40
  Speaker 0: and we started that Obviously were now expanding.
• 7:43
  Speaker 0: beyond That.
• 7:44
  Speaker 0: we got going.
• 7:45
  Speaker 0: And essentially, the problem statement there is like okay through an angel syndicate you need a really fast seamless way to raise capital from your network and handle things like fees in carried interest.
• 7:56
  Speaker 2: um
• 7:57
  Speaker 0: Through a platform that does all the admin otherwise spend a lot of time on paperwork chasing people email document back-and-forth and That kind of thing.
• 8:09
  Speaker 1: So then who's be?
• 8:10
  Speaker 1: Who was the intended audience?
• 8:11
  Speaker 1: because I'll say an element in my research that I felt was a bit vague.
• 8:17
  Speaker 1: And, and that could be peruseful and you'll tell me but who's the ideal person that uses Odin?
• 8:22
  Speaker 1: Is it some?
• 8:23
  Speaker 1: is it a fund manager?
• 8:25
  Speaker 1: uh...is it Angel Syndicate or is there a group of investors looking to crowdfund?
• 8:31
  Speaker 1: what..what's the Ideal Customer or usage of odin?
• 8:35
  Speaker 0: Yeah those are couple different use cases But our primary one people doing deal by deal.
• 8:41
  Speaker 0: They might be VCs or they might be angel syndicates.
• 8:44
  Speaker 0: It's kind of depends how they self-describe.
• 8:47
  Speaker 0: the key thing is, you know most our business right now focuses on single deal SPV structures so special purpose vehicles.
• 8:53
  Speaker 0: what that means Is I'm making a single investment in this single asset and That's where we started And i'm collecting money from people.
• 9:02
  Speaker 0: So i'm kinda running A mini fund.
• 9:04
  Speaker 0: let's make him one investment.
• 9:06
  Speaker 2: um
• 9:06
  Speaker 0: that tends to Be there's.
• 9:08
  Speaker 0: why would You do?
• 9:09
  Speaker 0: So one is like you're running syndicated structures because your investor network likes that.
• 9:14
  Speaker 0: They liked choosing the deals, but it's a case with angel syndicates through some multifamily offices to work that way and then some VCs do some of their deals That way.
• 9:24
  Speaker 0: And Then The other reason Is Like You're Building Investor Trust on A Relationship.
• 9:28
  Speaker 0: so when?
• 9:28
  Speaker 0: You're Getting Started in Asset Management.
• 9:30
  Speaker 0: It's Easy To Bring People Opportunities and Say Okay I want to Do This Specific Deal Than Be Like Give Me Thirty Million Dollars And I'm going to go and make all the decisions.
• 9:39
  Speaker 0: It helps you build that trust with your LPs, with your
• 9:43
  Speaker 0: investors.".
• 9:44
  Speaker 0: So we started out doing that... That's probably eighty-five percent of our business today.
• 9:50
  Speaker 0: We've recently privately launched a fund administration product which is basically same thing but you can invest in multiple assets instead of single asset.
• 10:03
  Speaker 0: And specifically what we categorize as like emerging fund managers, people on their funds one to four typically.
• 10:11
  Speaker 0: So usually a fund would be sub-a hundred million.
• 10:15
  Speaker 1: Okay.
• 10:16
  Speaker 1: so then how are you convincing kind of these investors?
• 10:21
  Speaker 1: Managers whoever it is that's interested in Odin?
• 10:23
  Speaker 1: How're you convincing them?
• 10:24
  Speaker 1: take the chance On your platform because I imagine all these things You talk about addressing.
• 10:29
  Speaker 1: they must already have some attitude or fix for, right?
• 10:34
  Speaker 1: Whether it's admin work.
• 10:36
  Speaker 1: whether its client relationships law.
• 10:39
  Speaker 1: I know you have a focus too on kind of tax complications when we're talking about the US versus Europe and all these things.
• 10:45
  Speaker 1: so imagine they already had ways of addressing this.
• 10:48
  Speaker 1: what is sales pitch then at your end
• 10:52
  Speaker 0: if were talking maybe like five years ago in Europe there are pretty limited way to address that actually The ways people doing well just bad an expensive.
• 11:04
  Speaker 0: Or they were using US platforms, for example in a way that wasn't really strictly compliant with regs in the UK or Europe.
• 11:14
  Speaker 0: I think now you've got a few options.
• 11:15
  Speaker 0: so there's us There is round table and France who have built good platform?
• 11:20
  Speaker 0: There are some other players in Europe Where we seek to differentiate.
• 11:28
  Speaker 0: We know the UK market very well.
• 11:29
  Speaker 0: They're specific tax you know, relief and that kind of thing available in the UK.
• 11:36
  Speaker 0: We've got structure that works really well for there.
• 11:38
  Speaker 0: And then I think the things we focus on are systems to automate as much as possible at the legwork but also having good service where it's needed.
• 11:48
  Speaker 0: so There is certain elements of fund administration.
• 11:53
  Speaker 0: It's financial services right?
• 11:54
  Speaker 0: So You can never get away from having humans in a loop.
• 12:02
  Speaker 0: You could do more and more, I think at the last mile with large language models than you could previously.
• 12:07
  Speaker 0: But like having great service... Having a great customer experience being super responsive Being able to get deals done in that last minute That's kind of stuff really matters.
• 12:15
  Speaker 0: And then recently what we focused on is kind of bridging the Atlantic.
• 12:21
  Speaker 0: So We've got US structures live now as well.
• 12:25
  Speaker 0: They allow U.S customers to raise money in the US, but also we have a good understanding and an ability is help them navigate.
• 12:36
  Speaker 0: Okay?
• 12:36
  Speaker 0: If you want to raise many from European LPs or from LPs in the UK by LPs I mean limited partners so investors in your SPV or fund vehicle
• 12:45
  Speaker 2: um
• 12:46
  Speaker 0: sorry if i'm teaching people something they already know... No
• 12:49
  Speaker 1: no it's safe here!
• 12:50
  Speaker 1: And uh
• 12:55
  Speaker 0: then for People In The UK & Europe okay how can raise capital from investors in the US.
• 13:01
  Speaker 0: In a way that's easier for them to work with, U.S.
• 13:05
  Speaker 0: Investors have very strong preference for local U. S investment vehicles for tax reasons.
• 13:12
  Speaker 0: about fifty percent of global LP Capital in Venture is in the u.s
• 13:21
  Speaker 2: and
• 13:22
  Speaker 0: us VCs are also very interested in Europe because There's kind of an arbitrage opportunity, right?
• 13:28
  Speaker 0: Labor is cheaper here.
• 13:29
  Speaker 0: Talent density is very high.
• 13:32
  Speaker 0: so if you can get interesting European businesses who could target the US they can become massive and their big opportunities.
• 13:41
  Speaker 0: I think we're seeing this increasingly from more recent batches of companies developing in Europe that are targeting to U.S sooner.
• 13:52
  Speaker 0: They're raising money for U. S firms sooner but all regulatory environments and that kind of thing are very different.
• 14:00
  Speaker 0: And product requirements as well, so bridging that gap has been a niche we've caught up on.
• 14:07
  Speaker 1: Let's talk little bit more about this because I do think it is an interesting topic in these conversations.
• 14:13
  Speaker 1: Is US versus Europe just understanding when it comes to the companies The funding environment?
• 14:22
  Speaker 1: So from what you're saying here It is improving, at least the amount of European companies that are interested in making The Jump across the Atlantic and American money.
• 14:34
  Speaker 1: That once it makes its way into Europe.
• 14:37
  Speaker 0: Yeah Definitely I think it comes with challenges.
• 14:41
  Speaker 0: so American VCs might also require that the top go there.
• 14:45
  Speaker 0: investing In is a US company.
• 14:47
  Speaker 0: There are potential tax benefits for them.
• 14:50
  Speaker 0: For then we're doing out this one called QSBS.
• 14:52
  Speaker 0: So qualifying business tax relief, basically where you pay low or no capital gains on exits if the investment is in a US company.
• 15:05
  Speaker 0: So You might have heard people talking about flips which has worked out.
• 15:08
  Speaker 0: I've raised some money in Europe and European Company but now i'm raising money to us and the U?
• 15:13
  Speaker 0: S. But investor wants me to flip my corporate structure so that my u s entity Is The Holding rather than like A subsidiary for example right?
• 15:23
  Speaker 0: But yeah, I mean there's more and more capital looking at an interested in Europe.
• 15:28
  Speaker 0: We have an interesting problem in Europe.
• 15:29
  Speaker 0: so we were really strong on seed funding.
• 15:35
  Speaker 0: you know i think over thirty percent You're among the guys that deal room will have very good data on this but i think Over thirty percent of seedfunding globally is into European companies represent less and less in percentage times of the total investment.
• 15:58
  Speaker 0: So I think there's a couple reasons for that, so they're structural ones.
• 16:03
  Speaker 0: locally.
• 16:06
  Speaker 0: That mean just aren't many growth funds here?
• 16:08
  Speaker 0: There also isn't this kind of cultural things are like do people have their risk appetite to do big growth rounds?
• 16:14
  Speaker 0: Here?
• 16:15
  Speaker 0: And there's also the fact that European startups may be able tendency to focus too much on our local markets.
• 16:20
  Speaker 0: It looks like big enough Right?
• 16:22
  Speaker 0: Like France, Germany or the UK.
• 16:25
  Speaker 0: big enough to get an enterprise value of a couple hundred million.
• 16:30
  Speaker 0: not really big enough.
• 16:31
  Speaker 0: To get some enterprise value in the billions very often.
• 16:36
  Speaker 0: but I think founders are starting to recognize that and thinking okay how do we go somewhere like the US sooner in terms of the markets that we target?
• 16:45
  Speaker 0: But yeah if you... And then i think the internet has kind open more and more European founders eyes to like American culture, American ways of doing business.
• 16:58
  Speaker 0: And I think that's really accelerated in recent years.
• 17:03
  Speaker 0: Um...I think if you're a founder in Europe it can be hard sometimes to be positive an optimistic because your surrounded by regulation the vibe in Europe politically and culturally is not very good and hasn't been very good since two thousand eight basically.
• 17:18
  Speaker 0: And if you look at like economic growth, we kind of... We were pretty much on par with the U.S.
• 17:23
  Speaker 0: pre-June and we've very much followed a different path since in terms of things like wage growth productivity GDP growth that kinda thing.
• 17:34
  Speaker 0: So I think If your founder in Europe it makes sense to look at the US sooner.
• 17:39
  Speaker 0: people are doing that they can see the opportunity there.
• 17:41
  Speaker 0: Then i think some of the positives we have is actually much higher talent density A lot of great universities, a lot of research on specific niches and specialization.
• 17:53
  Speaker 0: If we look at the UK which I know better like were very strong in AI and life sciences.
• 17:57
  Speaker 0: In The Golden Triangle We've got three or four top ten Universities in the world depending On Which rankings you Look At right?
• 18:04
  Speaker 0: Oxford Cambridge Imperial And then UCL is in some Of The Rankings.
• 18:08
  Speaker 0: You Have Similar Passions To This In Other Countries But We Don't Always Seem to Be Very Good At Capitalizing That And I Think Bridging that Is Like more late-stage capital
• 18:18
  Speaker 2: and
• 18:19
  Speaker 0: More of the American cultural ambition and mindset right?
• 18:22
  Speaker 0: The kind of frontier mind set that they have an
• 18:24
  Speaker 2: end.
• 18:25
  Speaker 0: They're willingness to be brave bold, Have self belief.
• 18:32
  Speaker 0: maybe Some you know in England or an island people would be like your lacking in humility Maybe but like.
• 18:41
  Speaker 0: they will see it a different way You know And I think there's probably culturally similar in some other countries Europe.
• 18:48
  Speaker 0: But yeah, we're really seeing that shift.
• 18:49
  Speaker 0: We are seeing more and more companies on our platform flip to Delaware Topcos with notice as a recent trend or incorporate from day one with the US topco And then at European subsidiary And On later stage rounds in particular like series A&B on raising from us funds.
• 19:11
  Speaker 1: Okay but so I have tasks because if If Europe were to go down this route of maybe kind of taking the positives of American business and American entrepreneurship, there would be less need for Oden.
• 19:25
  Speaker 1: Right?
• 19:25
  Speaker 1: At least from what I understand because you know if we're talking regulation which you've mentioned a few times now right then that complexity will be lessened The relationships between investors entrepreneurs on each side of the Atlantic would improve And There Would Be Lesser Need For Oden.
• 19:42
  Speaker 1: or my misunderstanding I
• 19:44
  Speaker 0: think if there was less of a need for like specific regulatory fit to Europe and the UK, Like I would be in favor that.
• 19:51
  Speaker 0: Right?
• 19:51
  Speaker 0: That might cannibalize some of our current business model or margins but it's kind of like the Jevons Paradox or whatever right?
• 20:03
  Speaker 0: It could create abundance with lift market overall.
• 20:07
  Speaker 0: I'll give you a specific example.
• 20:10
  Speaker 0: Why are there way more small VC funds in the US?
• 20:13
  Speaker 0: Like, There's a lot of two million three million five million eight million dollar funds.
• 20:17
  Speaker 0: The reason is You can set up a VC fund and file a notice with the SEC that takes about half a day to fill out review
• 20:28
  Speaker 2: And
• 20:29
  Speaker 0: you don't have any reporting or regulatory obligations beyond That.
• 20:34
  Speaker 0: they can stop you from operating unless your operating illegally You know, misleading investors and that allows you to market opportunities privately too.
• 20:44
  Speaker 2: Um
• 20:45
  Speaker 0: accredited investors.
• 20:46
  Speaker 0: we have similar definitions in the UK and Europe sophisticated high net worth professional
• 20:51
  Speaker 2: um
• 20:52
  Speaker 0: without further filings.
• 20:53
  Speaker 0: if you want to do that in europe you're looking at either getting an a from permission under something called AIFMD That's An Alternative Investment Fund Management Permission.
• 21:02
  Speaker 0: Doing that in house is going to take you six months two a year And also cost you A lot in terms of like having the right operational people and house.
• 21:11
  Speaker 0: Yeah, so it's Sixty to a hundred grand a year ongoing or you need to work through like a regulatory host And they're gonna charge you fifty grand a. yeah You know I got our regulatory hotel unless the permissions that then use under their permission Your sitting on the same regulation in many ways as someone managing Five billion dollars.
• 21:35
  Speaker 0: We then have additional thresholds, so as you hit like five hundred million in assets under management.
• 21:40
  Speaker 0: You need a separate custodian.
• 21:42
  Speaker 0: So this is like a third party who holds cash and asset.
• 21:45
  Speaker 0: reduce your cash and assets.
• 21:47
  Speaker 0: make sure everything's Accurate.
• 21:52
  Speaker 0: These were controls.
• 21:54
  Speaker 0: that's the control.
• 21:54
  Speaker 0: it became tighter after two thousand eight.
• 21:58
  Speaker 0: That adds cost.
• 22:00
  Speaker 0: But on those small funds, right?
• 22:01
  Speaker 0: Getting back to that.
• 22:02
  Speaker 0: If you're paying fifty grand a year on just regulatory and then you add your fund administration, payment processing accounting compliance KYC and AML all of the sort-of thing which is going to cost you minimum thirty grand per year.
• 22:14
  Speaker 0: Your fund costs at eighty k a year Over over the lifetime of our fund.
• 22:18
  Speaker 0: That's about eight hundred thousand.
• 22:21
  Speaker 0: For simplicity let say this is all dollars.
• 22:24
  Speaker 0: if it was four million dollar fund Then twenty percent of your fund has already spent admin, right?
• 22:30
  Speaker 0: Whereas if in the US you can do that for half of that then ten percent of these funds are spent on admins.
• 22:37
  Speaker 0: So it's much more accessible for smaller funds to be started.
• 22:40
  Speaker 0: and because Ventura is an industry where people have like weird ideas and weird ideas or the ones they end up being the biggest first time phone managers just have like The Hunger And They're Out seeking the weird ideas I think You End Up Seeding More Ideas That Can Become Very Big is you have a healthier venture capital environment.
• 23:02
  Speaker 0: So if the same thing were to happen in the UK and Europe, I think that could only do good things.
• 23:06
  Speaker 0: so far regulation became more in line with the way it works into US.
• 23:12
  Speaker 0: would there be less of a need for what owed and solving specifically?
• 23:16
  Speaker 0: Yeah possibly but we also have confidence in our ability just execute on a good product that people still want right like If does less ever need for us.
• 23:23
  Speaker 0: then That's out problem.
• 23:29
  Speaker 0: Building a business on the basis of regulatory arbitrage is like useful.
• 23:36
  Speaker 0: Often it's, like... The regulation just shouldn't be there.
• 23:39
  Speaker 0: and that's our whole problem in Europe right?
• 23:41
  Speaker 0: It's the reason we're in such a bad way.
• 23:44
  Speaker 1: Okay well I mean you are talking here about kind of US and Europe distinction but if were looking then maybe kinda more broadly at entrepreneurial Sector that you've been privy to now, then your involved with on different deals.
• 24:00
  Speaker 1: What do you see looking forward?
• 24:02
  Speaker 1: That's exciting for you.
• 24:03
  Speaker 1: I mean i can tell you right Now that probably Eighty percent of our coverage is something AI native Something LLM based Right and there was a lot of critique over this.
• 24:13
  Speaker 1: There's fears of an AI bubble.
• 24:15
  Speaker 1: Where do you land on all these topics?
• 24:17
  Speaker 1: Do You See the Futures being Fully AI as most companies Is their physical aspect?
• 24:22
  Speaker 1: thats turning up you As someone who's inside.
• 24:24
  Speaker 1: how do you Seal sector.
• 24:28
  Speaker 0: Yeah, I think there's definitely a bubble and I think bubbles can be productive.
• 24:33
  Speaker 0: the underlying technology is definitely game-changing.
• 24:37
  Speaker 2: um
• 24:37
  Speaker 0: And it's here to stay in.
• 24:38
  Speaker 0: we'll have a massive impact.
• 24:41
  Speaker 0: There was a dot com bubble in nineteen ninety nine two thousand but it definitely still changed the world.
• 24:47
  Speaker 0: i think what's exciting about AI Is?
• 24:50
  Speaker 0: The prospects for the categories of problems that could be solved I think potentially becomes much broader because it kind of commoditizes software, makes anyone be able to build software and allows software to do more in more areas at the economy that couldn't previously.
• 25:11
  Speaker 0: So LLMs... Because they have some level intelligence can do services work and free up people from mundane tasks to do more high-level thinking, and then it can also be a lot in the built world than real world.
• 25:31
  Speaker 0: This is my personal view.
• 25:32
  Speaker 0: but I think that the LLMs and AI are actually software's probably increasingly going to be like a commoditized market with lower margins Should be looking or you know could be looking.
• 25:57
  Speaker 0: I think if you think about where AI intersects with Biology and medicine, I think that's a really interesting sector.
• 26:06
  Speaker 0: there's lot of You know crazy stuff happening very fast.
• 26:10
  Speaker 0: their robotics is another one that keeps coming up.
• 26:13
  Speaker 0: manufacturing Manufacturing also have this massive tailwind because it like reindustrialization as a trend in the US and Europe.
• 26:24
  Speaker 0: it overlaps quite heavily with defence as well.
• 26:29
  Speaker 0: Governments are more hawkish generally at the moment, there are more wars happening.
• 26:36
  Speaker 0: so I think obviously this is the negatives of war but we'll also end up a lot innovation off-the-back and Europe has actually very well positioned on that next wave because Historically, in manufacturing we still have a lot of very good quality specialist manufacturing.
• 27:00
  Speaker 0: We also are very strong-in-life sciences so I think potentially we're in really great place.
• 27:07
  Speaker 0: What holds us back at the moment is... ...a set more in my view quite fixable political problems but we don't currently have the political will to figure out where they left and right are aligned so that we can take a pragmatic approach to solving those things.
• 27:29
  Speaker 1: Well, you bring up an interesting topic.
• 27:31
  Speaker 1: with it is the whole defense tech innovation and also spending.
• 27:37
  Speaker 1: I mean just security use startups.
• 27:39
  Speaker 1: We've seen...I can't say how many different defense tech funds kind of show-up in past year or two years And i'm sure you particularly know this as well.
• 27:48
  Speaker 0: Or dual use?
• 27:52
  Speaker 0: what they're investing in may have uses for defense, but it also has civilian use cases.
• 27:59
  Speaker 0: A lot of this is like how do we stop making stuff in China that's got any technology unit and make it in Europe or the US instead?
• 28:07
  Speaker 0: Sorry I cut you off.
• 28:09
  Speaker 1: No no i mean its going down that line.
• 28:11
  Speaker 1: thinking about your talking here That were seeing dual-use funding going on, dual used funds investment vehicles which kind of leads me into wondering how you see VCs, investment vehicles anything in that genre.
• 28:26
  Speaker 1: Kind of evolving because your presenting a product here what was it VC In Your Pocket Shopify for investing?
• 28:35
  Speaker 1: So so How does this mature?
• 28:38
  Speaker 1: do You See What You're Offering is the next step in The Investment Landscape or Is It Just A Complementary Angle to What Already Exists?
• 28:50
  Speaker 0: So I think Venture is going through a maturation period that looks quite similar to what happened in private equity and like the nineties or early noughties.
• 29:00
  Speaker 0: There will be consolidation, you're gonna end up seeing some very big platforms emerge.
• 29:05
  Speaker 0: so this is what's happening with like the mega funds
• 29:08
  Speaker 2: um
• 29:09
  Speaker 0: And some of those businesses are gonna list as well i would suspect right?
• 29:15
  Speaker 0: The same way businesses like KKR went public
• 29:18
  Speaker 2: and
• 29:20
  Speaker 0: they cater to a certain end of the market, some category or deal.
• 29:25
  Speaker 0: And then I think what you'll also get with the proliferation of software like Odin that makes it much more easy for anyone who's got started is small boutique firms.
• 29:37
  Speaker 0: Generally there are always new waves of technology.
• 29:40
  Speaker 0: AI has the purpose potential to be a very general purpose technology that a lot of different waves of innovation can potentially get built on.
• 29:51
  Speaker 0: So, that creates a lot surface area for boutique VCs focused on specific problem areas or ideas right?
• 30:02
  Speaker 0: I think you'll see further bifurcation.
• 30:05
  Speaker 0: so the mega funds will get bigger and bigger consolidate more capital but it's been hard to raise money.
• 30:11
  Speaker 0: as an emerging fund manager I suspect it will start to get easier because you're not gonna see the same sort of like outlier returns, have like a ten X in your fund on people with two billion dollar funds.
• 30:31
  Speaker 0: Because is just so hard by The Law Of Large Numbers To Return That Much Money On A Bigger Fund.
• 30:39
  Speaker 0: So yeah i think really positive.
• 30:43
  Speaker 0: It'll be interesting to see how the kind of AI bubble as it stands right now, you know washes out.
• 30:50
  Speaker 0: The Anthropica IPO is going to be a really important in terms like A lot people are gonna make money or lose money and What gets distributed back into ecosystem?
• 30:59
  Speaker 0: As a result that will define a lot of decisions that LPs make next And also for how much money there was around to flow into whatever comes next.
• 31:09
  Speaker 0: but I think definitely an exciting time.
• 31:13
  Speaker 0: I think, you know in my career i've been working professionally for maybe fifteen years and maybe in-and around venture for like ten years... I never experienced a time that felt so exciting both in terms of what's happening in the world culturally and politically Like the context The macro context And then also technology.
• 31:38
  Speaker 0: You know crypto had this hype cycle but everyone kind knew it was kind of bullshit, right?
• 31:43
  Speaker 0: Like it didn't have a proper use case.
• 31:45
  Speaker 1: Scammy!
• 31:46
  Speaker 0: Yeah scammy.
• 31:47
  Speaker 0: obviously there are some amazing user cases for crypto and they might be interesting use-cases especially with AI in things like micropayments and agents transacting with each other stuff like that.
• 31:57
  Speaker 0: It'll definitely have its day.
• 31:58
  Speaker 0: in some areas AI feels definitely less scammy.
• 32:03
  Speaker 0: lots of real world use cases Lots of amazing businesses being built.
• 32:07
  Speaker 0: We're seeing crazy exits people.
• 32:09
  Speaker 0: Yeah, and this is the other interesting thing by the way about being a small boutique fund Is you can exit via secondary right so?
• 32:18
  Speaker 0: You can get liquidity faster on a small fund because you're doing pre-seed seed series A if The business gets momentum Funds.
• 32:26
  Speaker 0: like Andre some want to buy all the shares.
• 32:28
  Speaker 0: they care that series B or Series C And Tiger are in whoever else.
• 32:34
  Speaker 0: So they wanna buy out as much of the existing cap table as I can.
• 32:37
  Speaker 0: So I think it could get you know fast liquidity And if you're good at spotting winners early, which is obviously super hard.
• 32:44
  Speaker 0: But um... You know?
• 32:45
  Speaker 0: If you've got an act for it there's a lot of opportunity in that end-of the market.
• 32:49
  Speaker 1: Yes Yeah well I could keep talking about this stuff easily but we found out around twenty minutes to thirty minutes was about the max.
• 32:58
  Speaker 1: people want listen to a podcast.
• 33:01
  Speaker 1: So i think were going to wrap up here.
• 33:03
  Speaker 1: There really weren't a lot topics I wanted cover.
• 33:06
  Speaker 1: We did.
• 33:07
  Speaker 1: And don't ever think that you're dumbing it down too much.
• 33:10
  Speaker 1: and I speak for myself, not for anybody listening.
• 33:13
  Speaker 1: but i'm always happy to kind of have these things explained to me because You are the expert!
• 33:18
  Speaker 1: You know?
• 33:18
  Speaker 1: And I am a journalist trying understand everything that you are talking about.
• 33:22
  Speaker 1: So yeah...
• 33:25
  Speaker 0: There is an interesting journalists-to VC investor pathway that you see quite often actually
• 33:32
  Speaker 2: And
• 33:33
  Speaker 0: a lot of that is just always being willing to ask the right questions, really understand something.
• 33:37
  Speaker 0: Right?
• 33:37
  Speaker 0: Well
• 33:38
  Speaker 1: you know I guess before we wrap it up hell there's one thing i want to ask about some...I just alluded all the way at the beginning.
• 33:44
  Speaker 1: It was this podcast work your doing.
• 33:46
  Speaker 1: and This interests me on a journalist level because I see this alot.
• 33:51
  Speaker 1: You know..i see a lot companies have their own podcasts.
• 33:54
  Speaker 1: I saw a lot VCs.
• 33:55
  Speaker 1: they're doing their own interviews.
• 33:58
  Speaker 1: When I seen that I kinda wanna flip script little bit you guys, and ask if you're the ones doing these interviews with these figures of importance.
• 34:06
  Speaker 1: And asking them the right questions where do you see publications like ours?
• 34:11
  Speaker 1: I don't just mean use startups.
• 34:12
  Speaker 1: it can be sifted It can be tech dot?
• 34:14
  Speaker 1: u whomever You Like.
• 34:17
  Speaker 1: what is our position in that ecosystem?
• 34:20
  Speaker 1: If we have companies like yours that are doing interviews if we have the C's, they're breaking news themselves whether it's funding rounds acquisitions IPO whatever.
• 34:31
  Speaker 1: It is well.
• 34:31
  Speaker 1: How do you see journalists kind of evolving in this sector?
• 34:36
  Speaker 0: So good question.
• 34:37
  Speaker 0: I think you have to distinguish between journalism and marketing don't you?
• 34:41
  Speaker 0: and i Think there's an inner world of social media and content.
• 34:47
  Speaker 0: those things are beginning to blur.
• 34:48
  Speaker 0: I think there will always be a place for like, purist independent journalism.
• 34:54
  Speaker 0: that is truth-seeking and i think thats never been more important especially because large journalistic outlets tend to be captured by some kind of person with an agenda.
• 35:08
  Speaker 0: There's more and more scope for like independent media.
• 35:12
  Speaker 0: But you also have to always be aware of, okay what are the incentives that a person presenting this story has?
• 35:21
  Speaker 0: And I think should make you cautious with any content your consuming from a company.
• 35:27
  Speaker 0: That is selling an adjacent product like... So i think The role techie or sifted Or whoever else Is to be independent.
• 35:38
  Speaker 0: voice is solo people on Substack or whatever, right?
• 35:47
  Speaker 0: I think what they can do that's a superpower Is like be a bit less corporate and authentic in how they speak Because there are fewer controls around.
• 35:58
  Speaker 0: They can kind of get their opinion A bit more because it's just them Right rather than a team.
• 36:04
  Speaker 0: There also not always from a journalism background and like Trained in the you know What true journalist journalism is.
• 36:13
  Speaker 0: But I think it's important.
• 36:15
  Speaker 0: true journalism is preserved for every industry.
• 36:20
  Speaker 0: So, actually the internet generally has been a real challenge for journalism because ads and that model incentivizes just click baity shit journalism where people don't really want to pay.
• 36:36
  Speaker 0: So I think you have to kind of figure out, okay.
• 36:45
  Speaker 0: We need to monetize in some way but in a way that doesn't conflict with whatever our principles or values are.
• 36:54
  Speaker 0: maybe there's a world where it is.
• 36:55
  Speaker 0: some journalistic outlets do pivot doing something alongside reporting.
• 37:06
  Speaker 1: It's many of uh, I mean met many of all our colleagues filled publications.
• 37:11
  Speaker 1: We we sustain ourselves through events You know because we have these contacts.
• 37:16
  Speaker 1: i'm speaking to you i'm Speaking to an investor and maybe I can get you guys in the same room.
• 37:21
  Speaker 1: And if I Can do that then Maybe there are people interested In going To That Room and listening to what you Have to say.
• 37:26
  Speaker 1: yeah so it.
• 37:27
  Speaker 1: you Know.
• 37:27
  Speaker 1: If That Kind Of Sins The Model That Even and not Just Us that Are Independent?
• 37:31
  Speaker 1: You know He Take Financial Times BBC right That They're Doing A lot of This too.
• 37:35
  Speaker 1: They're setting up their own summits and their own conferences to try kind of find that income, steady income.
• 37:43
  Speaker 1: That as you say just isn't there editorially or even adverts?
• 37:49
  Speaker 0: I think documentary filmmaking is another interesting angle unlike long-form content sounds a bit weird but like it doesn't have be super long form.
• 38:00
  Speaker 0: There's someone found on YouTube doing something called EU Foundry And I think it's just a guy in Germany kind of doing its solo.
• 38:08
  Speaker 0: I added him on LinkedIn and he is documenting companies that are like building, you know really game-changing exciting stuff...I watched one couple days ago about business at doing stuff with wave energy for electricity generation there potentially ten x more efficient than current wave energy technology..and i think telling those stories in an authentic way.
• 38:33
  Speaker 0: There's a massive space for that.
• 38:35
  Speaker 0: And you see it in other areas of journalism, so I love this publication the US called Channel Five.
• 38:42
  Speaker 1: Do you know
• 38:43
  Speaker 0: Andrew Callahan?
• 38:46
  Speaker 0: He is kind like The American Louis Theroux Of Our Generation but they are building an independent media outlet and he has very good at standing on his principles, trying to do unbiased journalism as much as possible.
• 39:02
  Speaker 0: And then he's very good at just getting close to the subject and presenting it and letting the subject you do the talking... ...and its' very authentic.
• 39:12
  Speaker 0: I think authenticity is that thing any journalistic outlet needs what people gravitate towards It.
• 39:19
  Speaker 0: easier for a business because Well, yeah.
• 39:27
  Speaker 0: Maybe it's not easy to do for a business It seems to be as an independent journalist because it's just your values right.
• 39:33
  Speaker 2: Yeah.
• 39:35
  Speaker 0: But I think those Those individual businesses will get turned into big new media outlets Right?
• 39:41
  Speaker 1: Yes To me the question then becomes you know what?
• 39:46
  Speaker 1: What does an audience get from your interviews versus what doesn't audience get form my interviews?
• 39:52
  Speaker 1: and is there distinction?
• 39:53
  Speaker 1: you know, are we cannibalizing each other's audiences?
• 39:56
  Speaker 1: Or is it very much?
• 39:58
  Speaker 1: I'm pandering to one specific view and your pandering another.
• 40:02
  Speaker 1: That kind of the ongoing question for me whenever i see companies like yours or VCs or whoever they have their own podcasts or publication arts.
• 40:10
  Speaker 0: Yeah!
• 40:11
  Speaker 0: It was a good question.
• 40:12
  Speaker 0: why...I think there's lot noise generally on the internet now.
• 40:15
  Speaker 0: so how do build something that asks real questions.
• 40:18
  Speaker 0: I think the job of journalists and the job they can do, maybe we won't is like ask hard question.
• 40:24
  Speaker 0: Ask uncomfortable questions right?
• 40:26
  Speaker 0: There's probably a market for it or you don't necessarily have to answer uncomfortable questions but still be friendly with people.
• 40:35
  Speaker 0: again i think channel five he was very good at that.
• 40:38
  Speaker 0: He just asked those questions.
• 40:40
  Speaker 0: then let them talk.
• 40:42
  Speaker 0: He lets the content do talking, you know.
• 40:49
  Speaker 0: And if he were captured by some interest... You wouldn't see a narrative presented that way it is.
• 40:57
  Speaker 0: I don't think in The Way That It Is on Fox News or CNN where its got very clear leanings.
• 41:15
  Speaker 0: Well,
• 41:25
  Speaker 1: I could
• 41:31
  Speaker 0: go on this all day.