Who is Reshma Sohini?
Reshma Sohini is one of the most prominent and respected pan-European speakers, as well as a co-founder and managing partner of Seedcamp – a seed fund with a portfolio of over 250 companies who have gone on to raise over one billion in follow-on funding from leading investors across the globe.
How was Seedcamp started?
Sohini was born in India and moved to America when she was 10. During the dot-com burst, she moved to Europe to do her MBA at INSEAD. Post-graduation, Sohini worked at Vodafone, after which she joined another VC firm. It didn’t work out with the firm and she took the opportunity to start Seedcamp.
Sohini and her Co-founder Saul Klein saw some of the problems in the European VC system – how entrepreneurs interacted with investors and networks, and how you had to be in these elite systems. They talked to people who held different roles in the system, then formulated how it could look and work as a product.
What are some of the fundamentals to getting funding?
Push on open doors first before going after the more difficult opportunities. It’s going to be much easier to get funding when from somebody who is already on the same wavelength, because they’re already sold on the idea and just need to hear about strategy and execution. In addition, this helps to build momentum and could persuade someone who is on the fence to give you funding if you already have a part of it and there are others who believe in you.
You need to be passionate about your strategy and your vision. That said, demonstrating openness to listening and making tweaks to your vision goes a long way. Sohini says entrepreneurs can be too dogmatic about one way of doing things. She says that when they give a “no” to someone, it usually comes from a disagreement in strategy.
Many entrepreneurs get rejected multiple times before they get their first funding, but what happens to people who have a brand underneath them? Is that an important aspect to consider?
It’s incredibly powerful asset because these networks build a common ground. Anytime investors are parting with money, it’s important that they’re going to trust, and having that connection can be a key part of that trust.
On the other hand, if you are not a part of these networks, there are ways to build your own brand and have your own thought leadership, as well as building your own distribution around that.
How does one build such a network?
You do need to be purposeful in your network building and relationship building. Anytime you don’t know someone, you should try to think of what are a few things that you can bring, say, or do that they will find valuable. There has to be a lot of give before take in building these relationships.
When someone comes into seedcamp, what is the process they go through?
Seedcamp starts with a week they call onboarding week, where new companies are brought together with previously funded companies. Although these companies may be in different stages and different markets, onboarding week helps to build connection and a sense of comradery.
After onboarding week is a lot of offline sessions like office hours, CEO,CTO, CPO, summits, events with our sponsors and LP networks. Seedcamp pushes a lot of our relationships towards the benefit of their companies, offline and online. They believe that it is this constant relationship that builds longer term relationship and the ability to help each other.
What is Seedcamp’s criteria for investing?
Seedcamp invest pre-series A, they invest 100k to 400k as their first check, to rounds of 100k to two million. There are no hard and fast rules regarding revenue or profit, some are even just ideas and not a product yet. Sometimes investments are made based on experience of working together on previous projects, even if the project themselves failed. It’s the whole package that Seedcamp considers.
How do you know if you’re ready for Seedcamp?
A business is ready for Seedcamp when money is the main thing that’s holding growth back. If a startup is struggling with not having money, but knows how to utilise the fund to quickly grow the business, then Seedcamp can help.
Some entrepreneurs steer away from seed funders and accelerators because they see them as people who hasn’t set up their own businesses. What are your views on that?
There’s a lot of assumptions made about someone coming from the corporate world, which is an inaccurate way to describe everyone. Many entrepreneurs will mistake advisors as operators of your business, which is something you should not want from an advisor. Having been through some of these journey multiple times, an advisor’s job is to see what’s going to come and what are the pitfalls and challenges, and help you prepare for them.
Some entrepreneurs avoid seed funds because they don’t want to be locked down to a schedule. How do we bridge the gap between these newer generations of entrepreneurs and creating a system where a seedcamp can work closely with them to get them to greater heights?
There’s week at the start of our program Seedcamp’s program, but it doesn’t lock you down for months. You can’t really get rid of forming a bond in person. You can minimize it to a certain extent, but it’s not going to be the same as meeting someone in person. There are centres of gravity for capital, talent, distribution, partnership, etc., and so you need to come though those places, unless you’re in a cave and still able to build a viral product, but there are so few of these compared to millions of other companies out there. Those centres of gravity matter for a reason.
What importance do you place on mentors?
We all mistake mentors for godlike creatures that are perfect, but they’re not – they’re normal people as well. There are things that they may excel at that you can learn from. They’re knowledgeable in certain areas as opposing to being end all and be all. You might see valuable quality in someone and you try to learn from that.
Is it better to join Seedcamp in order to find a mentor?
It’s a law of numbers, the more you have around you, and the more likely you’re going to find the perfect mentor. People try to stay in their comfort zone, but it’s not necessarily the best place for growth. From one relationship comes another and that’s what makes Seedcamp a great place to be.
Are there any final thoughts that you want to share?
It’s hard work, but if you’re willing to do it there’s always hundreds of people who aren’t willing to do it, so you just have to go for it and push and be curious and talk about your ideas.