20 VC Philipp Moehring, Head of AngelList Europe on Scaling Seed Stage Funding and Why 500 Is Not Your Traditional VC

In this episode of "20 minutes VC," host Harry Stebbings interviews Philip Murring, the head of AngelList Europe and a venture partner at 500 Startups. Murring, who was also the first European hire at AngelList, discusses his nonlinear path into the VC and tech industry, emphasizing the importance of experience over initial career plans. He reflects on the differences between the US and European investment scenes, noting Europe's fragmented nature and the US's maturity in venture capital. He also touches on the influx of US capital into Europe and AngelList's future, including its $400 million funding from CSC Upshot to invest in syndicates and the operational challenges ahead. Murring believes that while AngelList is expanding, traditional VC models will remain relevant, and he highlights London as Europe's top tech hub, with Berlin as a solid second. Finally, Murring shares his personal highlights, favorite books, productivity tools, and his vision for the next five years with AngelList and 500 Startups.

• Harry Stebbings introduces Philip Murring, a key figure in the European tech scene.
• Philip is the head of AngelList Europe and the first European hire for the company since January 2014.
• He is also a venture partner at 500 Startups.
• Philip's investment experience includes being a principal at Seedcamp and involvement in over 100 startups.
• Listeners are encouraged to check out Philip's AngelList syndicate and to thank John Henderson at Whitestar for the introduction.

"And following on from our amazing interview with European tech titan Morton Lund, we welcome another dominant player in the European tech scene today, with Philip Murring joining me." "He is head of Angel List Europe and he was also their first European hire, a role he has had since January 2014."

These quotes introduce Philip Murring as a significant player in the European tech industry, highlighting his position with AngelList Europe and his history of involvement in the startup ecosystem.

• Philip describes his non-linear path into the tech industry, emphasizing that career paths are often unpredictable.
• He worked for startups and large tech companies during his studies and realized he preferred smaller companies over corporates.
• Philip's involvement in venture capital began by assisting a professor with VC research at EPFL in Lausanne.
• His thesis on venture capital led to a job offer from a venture capital firm, Heidekoner fund in Bonn, Germany.

"First of all, when you look back, it seems to be a very straight line coming into the industry. It didn't seem like a straight line at all." "I worked for a professor that was doing research about venture capital and small businesses."

Philip Murring reflects on the seemingly direct but actually complex path that led him to the tech industry and venture capital, showing that career trajectories can be unexpected and opportunistic.

• Philip holds a Master of Science degree, not an MBA, with a focus on technology entrepreneurship and management.
• His undergraduate studies were in International Business in Maastricht, Holland.
• The Master's program at EPFL and HEC Lausanne was chosen for its emphasis on how technology changes the management landscape.
• Philip highlights the importance of understanding technological disruption in management studies.

"This was a master's of science, not an MBA, but the typical kind of European masters." "The technological change, the whole disruption theory and practice, of course, makes for a very different beast of management studies."

These quotes explain Philip's academic background and its relevance to his career, emphasizing the significance of technology-focused education in management and entrepreneurship.

• Philip disagrees with the notion that management consulting, investment banking, and accounting are the worst backgrounds for VCs.
• He references a quote from Guy Kawasaki, emphasizing the need for honesty and a realistic view of the VC industry.
• Philip suggests that young individuals in VC often start in analyst roles and may have a less predictable career path than in other professions.

"What do you think it is? So first of all, this was a quote I posted from Guy Kawazaki, who is a lot older than I am, a lot more experienced, has been in the startup world a lot longer." "However, as a young joiner in a fund, you usually do analyst work and associate work."

Philip Murring discusses the misconceptions about the VC industry and the career progression within it, referencing Guy Kawasaki's views on the subject and highlighting the reality of starting out in venture capital.

• The VC industry requires significant time to see returns on investments.
• Young career VCs face challenges due to the time it takes for investments to mature.
• Starting in VC as an associate and then joining startups can be good preparation for becoming a VC.
• Operational and business advice is increasingly important for early-stage investments.

"There certainly is a glass ceiling, but I think it's for a very good reason." "The illusion that you're going to make investments and become rich by being a VC when you're young is a fallacy that I think people need to understand."

The quote explains that the perceived barrier to advancement in the VC industry (the glass ceiling) exists due to the long-term nature of venture investments. It also dispels the myth that one can quickly become wealthy in VC at a young age, emphasizing the importance of experience and patience.

• Silicon Valley is the birthplace of venture capital, making the US scene more advanced.
• Europe's VC scene is younger and more fragmented, lacking a centralized hub like Silicon Valley.
• Trends in the US VC market often predict future trends in Europe.

"The european scene obviously is a lot more disjointed because companies come from more different places."

This quote highlights the fragmentation of the European VC market compared to the US, where Silicon Valley serves as a centralized hub for venture capital activity.

• The entry of US VCs into Europe is not a new trend.
• Great companies and founders exist globally, and US investors recognize opportunities in Europe.
• The seed stage in Europe still sees fewer US investments due to the need for proximity to the startups.

"I wouldn't say that it's a very recent phenomenon. This has been going on for years..."

The quote indicates that the presence of US venture capital in Europe has been an ongoing trend, reflecting the global nature of entrepreneurship and the recognition of investment opportunities across borders.

• AngelList's focus is on scaling seed and early-stage investing.
• Syndicates on AngelList are already investing in Series A rounds, with potential to lead in the future.
• AngelList aims to prove its model with big exits expected in the next five years.
• The platform's growth strategy includes expanding seed stage investments and syndicates.

"Well, first of all, a lot of syndicates are already investing in series A rounds."

This quote confirms that AngelList syndicates are actively participating in Series A funding rounds, indicating a shift towards more substantial investment activities and the potential for growth and leadership in this space.

"So I think over the next five years, what we want to do and what we kind of have to do is really deliver on the promise of scaling the seed stage and early stage investing..."

The quote outlines AngelList's strategic plan for the next five years, focusing on scaling their seed and early-stage investment processes and proving the success of their business model through anticipated exits.

• AngelList's expansion involves backing syndicate leads at scale, which was previously unfeasible.
• Operational excellence is critical for AngelList's success, including smooth investment processes and technological stability.
• Attracting the right deal leads and setting proper incentives are key to ensuring the right deals and investors are matched.
• The main challenge for AngelList is execution, particularly as it aims for long-term growth over the next 10-20 years.

"So really just making sure investments run well, making sure that everything is on solid footing from a tech perspective, obviously get the right people to lead deals, make sure that the incentives we set are the correct ones for deals, to run the right deals and find the right investors."

This quote emphasizes the importance of operational efficiency and strategic leadership in driving AngelList's growth and ensuring the success of their investment platform.

• London is the premier tech hub in Europe due to its large metro area, established technology and VC industries, and financial resources.
• Berlin is considered the second most important tech hub in Europe, with momentum in the tech scene.
• Other notable ecosystems include Stockholm's gaming industry, Paris's tech scene, and emerging markets like Lisbon and Eastern Europe.
• The attractiveness of a city contributes to its success as a tech hub by drawing in talent and fostering company creation.

"I think on all levels, London is just the number one ecosystem in Europe, and that won't change either for a long while or ever."

This quote highlights London's dominance in the European tech ecosystem, attributing its success to a strong combination of industry, finance, and attractiveness to talent.

• CSC Upshot's $400 million fund is designated for investment in syndicates, not as direct funding to AngelList.
• The investment aims to avoid market distortion by spacing out capital deployment over five years.
• This strategic funding approach is designed to maintain the integrity of both the AngelList platform and the broader market.

"So this 400 million is earmarked to go into syndicates only and absolutely also into european companies."

The quote clarifies the purpose and structure of the $400 million fund from CSC, which is to be invested in syndicates that support European companies through AngelList.

• Philip Murring's role as a venture partner at 500 Startups complements his work with AngelList.
• Venture partners typically invest on the side while holding a full-time job, providing additional deal flow to funds.
• Through AngelList, venture partners can run syndicates, enabling co-investments and benefiting both the partner and the fund.

"And then through Angelist, I will run a syndicate, so I will enable other people to co invest with me, which is obviously something where the two things come together and both parties are really happy that we can do some great deals."

This quote explains how the venture partner role and AngelList syndicates can synergize, allowing venture partners to facilitate co-investments and leverage their positions for mutual benefit.

• The rise of AngelList and syndicates does not threaten the existence of traditional VC models.
• 500 Startups is an example of a non-traditional VC fund, with a large, global team that operates differently from classic VCs.
• The VC model is expected to coexist with newer funding styles like syndicates, each serving different functions within the investment landscape.

"Definitely not. So first of all, 500 startups is by no means a classic venture fund."

This quote asserts that the VC model is not at risk of becoming obsolete due to the rise of AngelList and syndicates, as there are diverse types of VC funds like 500 Startups that are adapting to the changing investment environment.

• Angelist operates differently from traditional VC firms, with a focus on early-stage investments and allowing individuals to do more and larger deals.
• The VC model is boutique and well-suited for managing larger, later-stage investments.
• Angelist provides tools for funds to operate more efficiently, such as SPVs (Special Purpose Vehicles) for investing in proratas.
• New VC firms are using Angelist as a fundraising mechanism, but it's not expected to make the VC model obsolete.

"investing at scale differently, investing at scale very differently from Angelist, much more ran by a big number of people. But yeah, so this is definitely not a classic VC firm." "What angelist does is it allows people that are already doing great deals at early stage do more of them and so do bigger deals." "A lot of VC funds actually run syndicates and new VC firms are being born that use angelist as a fundraising mechanism."

The quotes explain how Angelist differs from traditional VC firms by allowing individuals to scale their early-stage investments and by providing mechanisms like SPVs to streamline the investment process. It also mentions the emergence of new VC firms that leverage Angelist for fundraising.

• Philip Murring's decision to join 500 Startups was influenced by his admiration for the people, particularly Dave and Beggy.
• He appreciates 500 Startups' flexible investment model, which aligns with his work at Angelist.
• The model allows for an investment style that is consistent with his approach to evaluating companies.

"First of all, I love the people. So Dave and Beggy, who I mostly talked with and worked with at 500, are just really amazing people." "it's a really interesting model where I can invest in a style that wouldn't change how I think about companies, it wouldn't change my work with Angelist."

Philip Murring highlights his personal connection with the team at 500 Startups and the compatibility of their investment model with his philosophy and work at Angelist.

• Philip Murring finds joy in seeing entrepreneurs he invested in become successful.
• He values the experiences and daily work at Angelist and 500 Startups as career highlights.
• He hopes to continue seeing growth and success in his current roles.

"So overall, I got to say what makes me happiest? See entrepreneurs succeed." "working at Angelist, working with 500, is also something that I enjoy every day. So that's kind of a highlight too."

The quotes reflect Philip Murring's career satisfaction, coming from witnessing the success of entrepreneurs he has supported and his enjoyment of his roles at Angelist and 500 Startups.

• Philip Murring is influenced by writer William Gibson.
• He recommends "Snow Crash" as a book that provides a compelling vision of the future.
• He often looks to science fiction for insights into technological advancements.

"I think if I had to pick one book that if someone asked me what book should I read, I would probably say snow Crash." "I've caught myself looking to science fiction much more than to research or academia when it comes to new technological advances."

The quote suggests that Philip Murring values science fiction for its ability to explore future technologies, with "Snow Crash" being a standout recommendation for its vision of the future.

• Philip Murring appreciates Brad Feld's blog for its personal style and coverage of topics that others avoid.
• He values openness and the willingness to discuss a wide range of subjects.

"Brad writes really well. He writes really personal, in a really personal style, which I really appreciate." "He's also covering topics that a lot of other people don't dare touch or don't want to openly talk about."

Philip Murring praises Brad Feld's blog for its personal approach and the courage to address issues that are often not discussed openly.

• Philip Murring uses a tool called Self Control to block distracting websites.
• This tool helps him focus on work by limiting access to social media and news sites.

"My biggest productivity tool is a tool called Self Control."

The quote indicates that Self Control is Philip Murring's key productivity tool, helping him maintain focus by blocking distractions.

• Philip Murring aims to scale the model of Angelist and expand its reach to more entrepreneurs and investors.
• The next five years are seen as a critical period to prove the effectiveness of the Angelist model.
• He is content with his current situation and hopes to maintain it for several more years.

"I hope that with Angelist, we can really show that we can scale this model and really bring it to more places, bring it to more entrepreneurs and more investors."

The quote conveys Philip Murring's ambition to grow Angelist's influence and validate its model as a scalable option for entrepreneurs and investors.