Different syndication and facilitation processes have been tested throughout FiBAN’s history. Through trial and error, together with our Nordic and Baltic colleagues, a new concept of startup investment process was created and kick-started in spring 2018. The Nordic Angel Program by FiBAN serves the purpose of teaching the best practices of startup investing and offers the facilitation service that can be a great asset to a successful investment case.
So, I was offered a challenge: gather a group of angel investors, organize professional training for them, and, the hardest of them all, find great investment cases for them to screen and eventually do a joint investment. Really, like diving into the deep end head-first. Thankfully, I had the superior help from Arctic Startup team, whom we collaborated the deal flow under the name of Arctic15 Funding Program. Emphasis was on the word funding, meaning only startups who were committed to accept the investment and work with the syndicate to make it happen were accepted to proceed into further stages of the program.
This is how it was ditched:
All startups were screened and evaluated by investors participating in the Nordic Angel Program. The whole pool was over 270 startups, from which investors screened the group down to 30. The investors asked for more information on their future forecast, team information and other key factors, from this group, to enable investors find the best of the patch. This is where it got really interesting. Based on the results, the top 15 startups were invited to participate to startup sparring session with the syndicate - a whole new concept, where startups do not pitch. This was a result of a late-night brainstorming with the team, including our Lead Angels Reima Linnanvirta and Ali Omar.
Lead angels didn’t want to see who can give the best three-minute presentation. When searching for the best team to invest in it’s more important to find the team who are coachable, and something that is often forgotten: whose personalities match with the angels. To be able to work with the team for years, it’s important to find a good match on personal level, as well.
To me, the whole idea made perfect sense. As someone outside of the startup bubble, I didn’t see pitching as something utterly necessary. However, many did at first question the concept: “So when will they pitch?”, “How can we evaluate them without pitching?” To say the least, I was anxious when the group gathered to Maria01 for the session.
To my great relief the day was a success. After short introductions the group was divided into individual workshops. All startups got thirty minutes of personal sparring time with angels. It was a win-win situation for all: startups got invaluable feedback, and investors got a better grasp on the business cases and innovations on the table. At the end of the day, startups were sent home and angels stayed to discuss on the day’s findings. After weeks of evaluating and seeing how well startups performed when sparred and challenged, it was clear for the syndicate which startups should proceed to due diligence phase.
Finally, it was Screenful that performed best on all aspects. They delivered information that was required within the short time given; their business case was solid; team was approachable and coachable; no red flags in due diligence; in a nutshell, a very easy decision for the syndicate to invest €115k. The investment was announced on the stage of Arctic15 and the whole process was finalized in the following weeks, enabling Screenful recruit new workers (NOW, check details here!) Screenful was invited to join the syndicate for a final training session at Fondia office, who provided expertise on the subjects that benefited both the syndicate and the company.
Sometimes looking at things from a fresh, “newbie” angle can be beneficial. When one has no prejudices, everything can be tried out. And while trying, gather the brightest people around you, and you shall float in the deep end just fine.
FiBAN's news about startup investing.