Founders Friday 002 Balderton's James Wise interviews 20VC Founder, Harry Stebbings

Summary Notes


In this special episode of the 20 minutes VC and Founders Friday, Harry, the usual host, is interviewed by James Wise, principal at Balderton Capital. Harry shares his journey into the venture capital industry, sparked by a fascination with technology's scalability potential, which began after watching "The Social Network." He discusses the importance of VC firms in providing more than just capital, the impact of his podcast in connecting with VCs, and the traits he believes are essential for success in the field. Harry also touches on his interests in the freelance economy and the future of 3D printing marketplaces. Despite the challenges of breaking into VC, Harry encourages passionate individuals to immerse themselves fully and leverage various platforms for networking and learning.

Summary Notes

Introduction to the Podcast Episode

  • Harry is interning at Buldison Capital, a leading VC firm in Europe.
  • James Wise, principal at Buldison Capital, will interview Harry.
  • The discussion will cover commonalities among great VCs, surprises in the venture industry, and advice for entering the industry.
  • Special thanks to the hiring screen and Jackie for their behind-the-scenes work.

"Hello and welcome to a very special episode of the 20 minutes, VC and Founders Friday. Over the last two weeks, I've had the great pleasure of interning at Buldison Capital, one of the leading VC firms in Europe."

This quote introduces the episode and sets the stage for the interview with Harry, highlighting his recent internship experience.

The Reverse Interview Concept

  • Inspired by President Obama's reverse interview with David Attenborough.
  • James Wise will interview Harry to provide listeners with insights from the host's perspective.
  • The reverse interview aims to learn from Harry's experiences and thoughts.

"I think slightly inspired by President Obama's recent interview of David Attenborough, a classic reverse interview. I thought, given how much your listeners and how much your audience has learned from your questions, I thought it's about time to spin the tables a little bit and throw some back at you."

James explains the reasoning behind the reverse interview format, drawing inspiration from a notable example and aiming to delve into Harry's experiences.

Securing the Internship

  • Harry got the internship opportunity after interviewing James on the podcast.
  • The initial contact was made through Twitter due to the unavailability of James's email online.
  • Harry's enthusiasm for venture capital led him to seize the opportunity at Buldison Capital.

"And I actually reached out to you over Twitter. I remember because I couldn't find your email on the Internet, which is unbelievable now because I see it on the Ballsome website and everywhere, my personal website everywhere."

Harry recounts how he secured the internship by reaching out to James through Twitter, emphasizing the importance of taking initiative and utilizing available resources.

The Decision to Work in Venture Capital

  • Harry chose to spend part of his long summer interning in venture capital.
  • He expresses a deep interest in the field, interviewing VCs weekly and considering it a dominant strand of thought.
  • The chance to learn from a leading firm in Europe was too great to pass up.

"I mean I do live and breathe it. I mean every week I interview vcs from around the world. It probably sounds rather strange to say it's definitely one of the dominant strands of thought that."

Harry explains his dedication to venture capital, indicating that his passion for the industry drives his decisions and pursuits.

Early Interest in Finance and Technology

  • Harry's interest in venture capital was sparked by watching "The Social Network" and learning about early investments in Facebook.
  • His curiosity led him to research the industry further through platforms like TechCrunch and Reddit.

"I was sitting in the cinema watching the social network with Jesse Eisenberg and I saw peace Teal and Clarence Capital investing in Facebook in that film and I thought that looks like a pretty sweet deal."

Harry shares the anecdotal beginning of his interest in venture capital, highlighting the influence of popular culture on career aspirations.

Starting the 20 Minutes VC Podcast

  • The podcast was started due to a lack of VC-focused content in existing podcasts.
  • Harry identified a gap in the market for a VC-dedicated podcast that fit within the average commute time.
  • The 20-minute format was chosen to maximize listener retention and engagement.

"I started it actually just because I listened to a lot of podcasts and there weren't enough podcasts dedicated to vcs in the magic capital industry. So Tim Ferriss might interview Jamie, Tim Ferriss might interview Peter Thiel or specific funds, but it's not dominant and there's not enough for me to satiate my appetite."

Harry describes the motivation behind starting his podcast, emphasizing the need for specialized content in the venture capital space and the strategic choice of a 20-minute format.## Podcasting and Networking

  • Harry started a podcast with episodes around 20 minutes long to match his attention span.
  • The podcast has been a successful networking tool, allowing him to make around 70 valuable connections with venture capitalists (VCs).

It's a good attention span and so that's really why I started it and why it's 20 minutes. And then it's also been a fantastic connector for me in terms of meeting people. I've made probably about 70 really good connections with vcs just through the show, which has been fantastic for me.

Harry explains the dual reasons behind the podcast's format and its unexpected benefit as a networking platform, emphasizing its effectiveness in connecting him with the VC community.

Investment Philosophies in Venture Capital

  • Two main investment philosophies are observed among VCs and angel investors: one that focuses on the importance of the team and another that emphasizes the importance of the product or idea.
  • Regardless of the investment philosophy, the potential size of the market is a critical factor for VCs aiming to find unicorns, or billion-dollar companies.

I mean, it's always a really interesting mix when you actually talk about the investments and what drives them because you've got two clear strands of thinking within investing. From what I've seen, you might correct me on this one, but it's people who believe in the team and the importance of the team and people who believe in the idea and the importance of the product. And those are the two that's really come out in terms of kind of really diverse strands. It's an interesting one. And then also obviously the size of the market is always a massive player. VC is all about finding that unicorn, the billion dollar company. So the market has to be really big enough and that is always uniting feature of all the vcs. Definitely.

James Wise summarizes the two prevalent investment philosophies in venture capital and highlights the universal consideration of market size in the search for highly successful startups.

Experiences at Bolton HQ

  • Harry's time at Bolton HQ was brief but insightful, with highlights including attending a board meeting.
  • The board meeting answered Harry's question about the value VCs add beyond capital, demonstrating their significant and irreplaceable role in the industry.
  • Harry enjoyed the pitch sessions, where he observed the analysis of ideas and the assessment of teams.

A board meeting, yeah. And it really solved a question that I've kind of been pondering and the question is what do vcs actually add? And Dustin Doggan Atlas says capital is a crappy differentiator and he's right, your money is the same as mine. And so I wonder what do vcs bring? And in that board meeting I saw the immense value that bring.

Harry reflects on the substantial value VCs provide beyond mere capital investment, as witnessed during a board meeting, which reinforced his belief in the industry's sustainable future.

The Future of Venture Capital

  • Harry has not experienced any disappointments during his time at Bolton HQ, except for a trivial issue with an espresso machine.
  • He is confident about the future of the VC industry, citing discussions with the National Venture Capital Association (NVCA) and the steady or increasing VC asset allocation.
  • Startups continue to seek funding from venture firms due to the unique value they offer compared to other financing methods.

I think it is shared across the know. I've spoken to people at the NVCA and we see that VC asset allocation is going where it's steady and in some cases even going up, which I think is indicative of a real future for the VC industry.

James articulates his confidence in the VC industry's future, backed by his conversations with the NVCA and observations of consistent or rising VC investments.

Interest in Technology and Scalability

  • Harry is drawn to technology companies over other sectors due to the incredible scalability potential.
  • He is particularly interested in the freelance sharing economy and the resources driving it, noting the rapid user growth of platforms like Snapchat.
  • By 2020, Harry mentions that 40% of employees will be freelancers, indicating a significant shift in the workforce and a growing market for technology solutions.

Technology in general, over other sectors, I think is just phenomenally exciting, just due to scalability. If you have a restaurant, it takes a long time before you can scale to ten considerable years, but Snapchat reached millions and millions of users within a month.

Harry emphasizes the unique scalability of technology companies compared to traditional businesses, which fuels his interest in the sector and the freelance sharing economy in particular.## Freelance Economy

  • The freelance economy is experiencing significant changes and growth.
  • Tools and opportunities are available to increase freelancer productivity, incomes, and budgeting efficiency.
  • Recent shifts in workforce classification affect companies like Ship and Uber.
  • Despite regulatory pressures, the freelance economy is considered too large to revert to previous models.
  • The freelance model is expanding across various industries, benefiting part-time workers and those with disabilities.

"And I think there's a huge amount of tools and opportunity there for increasing productivity, increasing incomes, income, budgeting, all of these that will increase freelancer's efficiency."

This quote emphasizes the potential benefits that the freelance economy can bring in terms of productivity and financial management for freelancers.

"Uber is under a lot of pressure in certain states in the US and increasingly in Europe to consider something similar."

James is highlighting the current regulatory challenges faced by companies like Uber regarding the classification of their workers.

"It's now too large a section of the economy for significant regulatory changes to occur."

James Wise believes that the freelance economy has grown too significant to be substantially altered by new regulations.

"Which is fantastic in many ways. I think it allows people to be multi skilled and allows people to brings a lot of people into the workforce who can only work part time, new mothers and people with disabilities who may only be able to work full time."

Harry is acknowledging the benefits of the freelance economy for diverse groups of people, such as new mothers and individuals with disabilities, who may not be able to work full-time.

Venture Capital Success Traits

  • A successful venture capitalist (VC) possesses a deep analytical thought process.
  • VCs must be able to see beyond the surface of a company and understand the resources and workforce driving it.
  • Personal traits of a good VC include humility and a willingness to learn from entrepreneurs.
  • The ability to adjust to the entrepreneur's way of thinking is crucial during pitches.

"It's a deeper analytical thought as to the potential and underlying knock on effects."

James Wise is describing the necessity for VCs to have a profound analytical mindset to evaluate the potential and implications of the companies they consider investing in.

"What's important with everyone, not just vcs, but important with everyone, is knowing that there will always be people who know more than you."

James Wise is stressing the importance of humility and openness to learning from others, which is a valuable trait for anyone, including VCs.

Exciting Ventures and Technologies

  • Crowdkeep is a company with significant potential in alternative finance, appealing to the mass market.
  • Crowdfunding platforms like Crowdview Spain show potential for expansion in Europe.
  • 3D Hubs offers a marketplace for 3D printers, eliminating the need for ownership and addressing industry setbacks.
  • Education on 3D printing uptake is necessary for broader adoption.

"I love crowdkeep. I've had a fascination with crowdkeep for probably two or three years now, which is a 15 year old crowdfunding strange 15 year old."

James Wise expresses his long-standing interest in Crowdkeep, a company in the crowdfunding space, and acknowledges its potential for growth and mass-market appeal.

"I think it's only touched the surface in terms of expansion into Europe."

James Wise sees significant potential for crowdfunding platforms to expand in Europe, suggesting that current successes like Crowdview Spain are just the beginning.

"For 3d hubs to solve that problem is brilliant."

James Wise is excited about 3D Hubs because it provides a solution to a major barrier in the 3D printing industry by creating a marketplace that eliminates the need for individuals to own 3D printers.## Government Funding and Education Programs

  • Government initiatives are expected to resolve barriers to accessing technology.
  • Education and subsidies will enhance the ability to design and upload files.
  • This will benefit business models like hubs.

But I think with time and with government funding and subsidies and education programs, that will be solved.

The quote suggests that government involvement through funding and educational support will address current technological challenges, facilitating business growth in certain sectors.

Investment Preferences

  • James Wise expresses a preference for investing in crowdfunding.
  • He appreciates Tictail's consumer-facing approach and the ease of creating online stores.
  • Recognizes the competitive nature of the space Tictail operates in.

So that's where you put your money, is it? If we gave you your own fund, you'd be investing in crowdfunding.

James Wise would allocate investment funds to crowdfunding, indicating his belief in its potential for growth and profitability.

Career Progression and Focus

  • James Wise plans to continue his podcast and networking.
  • He will work at Founders Forum and with MMC Ventures in London.
  • He is committed to focusing on the venture capital (VC) industry.

Continue interviewing the world's greatest species. Continue making great connections. I'm going to be working at Founders forum for the summer and then ongoing after that on a part time basis.

James Wise outlines his immediate professional plans, emphasizing his dedication to the VC industry and his podcasting work.

Advice for Aspiring VC Professionals

  • Passion for the job is crucial; monetary motivations alone are not enough.
  • Immersion in VC is key: reading news, articles, reaching out to VCs, and making insightful comments.
  • The VC industry is welcoming to young professionals but requires dedication and extensive homework.

If you wake up and are extremely passionate... then you know it's the right thing and then you should do it.

James Wise emphasizes that a strong passion for venture capital is a prerequisite for success in the field.

Book Recommendations

  • Ben Horowitz's "The Hard Thing About Hard Things" is frequently recommended by VCs.
  • James Wise suggests "The Four Hour Work Week" by Tim Ferriss for productivity and efficiency insights.

I would definitely recommend the four hour work week by Tim Ferriss.

James Wise recommends Tim Ferriss's book as a valuable resource for improving work processes and productivity.

Acknowledgments and Team Contributions

  • Recognition of the challenges and skills involved in podcasting.
  • Appreciation for the contributions of team members.
  • Mention of Hiring Screen as a useful recruitment tool.

You've been a huge addition to the team.

The quote acknowledges the value James Wise has added to the team, highlighting the importance of individual contributions in a collaborative environment.

Recruitment Technology

  • Hiring Screen's blink algorithm optimizes recruitment by focusing on relevant candidates.
  • Emphasizes the balance between technology and personal judgment in hiring.
  • Introduction of a successful hire, Jackie, as a case in point.

Whose blink algorithm means I spent less time looking at a huge number of cvs and more time meeting truly relevant candidates.

The quote describes the efficiency gains from using Hiring Screen's algorithm, which streamlines the recruitment process by identifying suitable candidates.

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