Access to Capital has always been at the heart of focus for startup founders. There is tons of good (or bad) advice out there, venture funds keep popping up and the business angel ecosystem is growing at a healthy rate. So, the demand of founders for this critical resource is increasingly addressed.
Surprisingly, for the other key resource that any startup needs to grow, there is very little happening within the investor’s community. Some larger funds offer functional advice on recruiting, many try to leverage their personal network here and there to fill critical positions. But, all in all, these approaches are opportunistic at best.
All this would not matter if startup can get what they need on the market. But if you talk to founders, from London to Berlin, from Estonia to Ljubljana, the message is the same: recruiting is broken.
But what is it exactly that our founders cannot solve via traditional search companies or their own recruiting activities?
1. The big, unsolved challenge: IT recruiting.
Everybody across Europe talks about the same problem and nobody has a good answer. Affordable, skilled coders are rare everywhere (especially in European startup hubs like London or Berlin) and for everyone, but for digital startups in particular, access to these resources basically dictates the speed at which they can move, iterate and scale. It defines the horsepower of their engine room. Solving this puzzle would provide an amazing competitive edge to our portfolio.
2. Avoiding “quick & cheap” solutions.
Recruiting is an old business with very established business models. Unfortunately, they do not fit for early stage startups. So far, the only answers are performance based offers which often result in a low effort, low hanging fruit approach by service providers. But top quality startups need top quality service. This is another puzzle to solve.
3. Employer branding for a network.
Startups are a funny thing. While each of them has no brand power whatsoever and joining them is perceived as a big risk, together they create significant talent pull these days. This is where a portfolio approach towards employer branding (i.e. putting Speedinvest in front) can be very powerful. At the same time, successful recruiting has always been driven by personal networks. So what if we are able to leverage the personal networks and brands of all our 50+ companies? Crucial for doing this is the adoption of a clear set of rules that build a trusted, long-term relationship between our founders. A joint lead investor has the power to implement and execute such a rule set.
With Speedinvest Heroes, our new unit solely dedicated to this topic, we plan to tackle these challenges. If we succeed, we will have built a powerful competitive weapon for the founders we support and for us as a fund.
Heroes has a few very distinctive advantages:
- In our core region, we are a natural magnet for talents
- As startup insiders, we can hit the ground running
- We have reshaped the business model to be in sync with early stage startups
The result will be faster and cost-effective hiring of top people for our founders. And if this works, maybe other funds will take notice.
Reinventing venture, one piece of the puzzle at a time.