Pervir Bhachu is the Investment and Deal Flow Manager at Innovation Warehouse. In this feature he describes our investment-readiness process, a collaborative programme based within the startup environment itself, designed to result in a successful exit.
I first heard of Innovation Warehouse around 2010. I was working on a consulting project to create an innovation ecosystem in Lagos, empowering people to generate jobs through technology. The aim was to tackle the rapidly growing number of unemployed, primarily amongst the younger demographic.
They wanted to build an entire technology-focused ecosystem from scratch and our job was to research how similar ecosystems worked in London, looking at coworking, startups, funding and what role government played.
We delivered the programme, but it was a startup consulting firm and after a while the company changed focus and scaled down. I started applying for tech jobs around the time of the pick-up in the tech sector in 2013, sent an email to Innovation Warehouse, met founder Ami Shpiro and spent the first three months developing case studies, and analysing all the startups that had been through over a certain period.
The City of London wanted the metrics of how many companies had come through, how many jobs had been created, and how much investment had been pumped into these companies. They wanted to understand the growth rates. I interviewed and researched startups and learnt everything around them before I was even working full time on the day-to-day business at Innovation Warehouse.
Due Diligence in Motion
Our investment-readiness process was at a very early stage at that time. There was mentoring but no process around it to take things forward, and we expected a lot less from early-stage companies. Now, we expect ten times more – there’s more deal flow and more external funding for these companies to get seeded. It was early, it was happening, but it wasn’t structured. Now it’s all about investment first – although mentoring remains a foundation that we provide to all companies.
Companies that come to Pitch Wednesday are actually getting their first taste of the investment-readiness process, designed for startups that catch the attention of our investors and ultimately go onto the WISE programme.
The aim is that one or two of the pitching companies are ideally investable to a certain level – they have a product; they are commercial; they have a strong pipeline and a very good team. They will also require very little support – typically they won’t need acceleration help or be part of an accelerator programme and we can actually start the due diligence process immediately, in real time.
We’re testing the companies’ product, what’s under the bonnet and what they have to offer, with a group of ten people from various different backgrounds who are helping to develop and grow it.
We support companies that require investment readiness through a two-week process of fine tuning a certain part of their proposition as a route to market. This could be everything around their finance, working on their P&L, projections for the future etc. We actually help them with quite a small area of their business, so the longest it would take is a month. This is investment – not acceleration. The ideal result is a successful exit.
Click here for an investor’s view on the pitching process