Week 7: Panel, Clubhouse, Not Knowing and staying connected
Winter in Berlin and a well balanced week.
I had a lovely week in these weird times. This week had a nice balance between spending time with startups, working on strategic topics with my colleagues, and having time to think, work, learn and reflect. I was at the office twice and am sitting at my desk right now, and although it is freezing outside, the sun has quite some power and warms the room—T-Shirt climate.
Zentrum am Zoo opened.
Some of you know that I have two non-profit dimensions in my life: betterplace.org/ gut.org, which friends and I co-founded 13 years ago, where I am a shareholder (of a non-profit share-based company), and Die Berliner Stadtmission, where I am a member of the board of trustees. gut.org is digital and fast scaling, and Berliner Stadtmission is local, very real, and helps many people. This week Berliner Stadtmission opened Zentrum am Zoo (Page in German) - a new space at the famous Zoo station in Berlin where we support homeless people and created a space for everyone to come together connect. During Corona, the emphasis is on helping, and hopefully, soon, we will be able to connect people to learn about homelessness and having a home.
Panel: LSE German Symposium - Do VCs dare enough?
Last week I was on a London School of Economics German Symposium Panel with fellow investors, and we discussed if Venture Capitalists dare enough. This is an interesting question, especially when considering the different phases of startups and their needs. As APX, I think our approach to investing up to EUR 500k in multiple “rounds” up to Series A allows us to invest in many great teams at a very early stage. After our initial investment of EUR 50k, we can commit to another 150k within 8-12 weeks. When more investors join, we can invest even more. With this approach, I think we can support great teams at the beginning and at the same time be a long-term partner and support with capital and knowledge and network during the early days of our companies. And we can do this by keeping the cap table and ownership structure attractive for future investors, the founders, and us.
We also discussed diversity on the panel. I think there is still some room for improvement. We obviously can have more females on panels, and I believe there is some room to overcome selection biases in making investment decisions. We are working on being as open as possible to founders coming from unconventional angles. To have a colorful portfolio and opportunities, it is also essential to have a team that will attract the best founders. I like to believe that there is something like magnetism: I hope we will continue to attract great founders with a great team and an excellent and accessible network and write success stories with our portfolio companies and encourage more entrepreneurs to reach out to us.
Clubhouse 1: Ijad, Ole, and me conversation
On Tuesday, Ole, Ijad (what do you think is the better link? A profile on the network you co-founded, a Wikipedia entry, or your LinkedIn profile?) and I discussed on Clubhouse how Ijad started Researchgate. Of the many takeaways from our conversation, these two are my favorites:
Having a US investor as your first VC has massive strategic consequences for your venture path. In Researchgate’s case, they had Benchmark capital, and they supported them in their long-term approach to getting as many scientists to join the platform as possible. European or German investors might have pushed for profitability, monetization, or even a trade sale a lot earlier.
With researchgate’s particular model of creating the network for scientists not having any marketing budget to acquire users makes sense. For a platform like them, the quality of members and content is vital. And although their competitors grew faster in the long run, the quality approach turned out to be most sustainable. There is hope for me that the best services can win in the long run.
Dealing with not knowing
In my conversations with portfolio companies this week, we discussed “not knowing something” quite often. As a startup, this is a tricky topic: there will be many things you do not know. In my experience, the critical next question is not to find everything out but rather cluster and prioritize what you need to know when. It can be quite liberating to identify what you do not know and how you feel about not knowing this. When you then put it on a timeline and look at when you have to know it to make a decision, it is, in my experience, the best way to deal with the topic. Depending on people and industries, there are quite different attitudes towards not knowing and the consequences. Our APX shareholders are interesting examples: Porsche knows a lot about their products, and they love and cultivate a deep understanding of their products. They know a lot about cars and how to build them. Axel Springer knows a lot about media. But, hundreds of people in the organization have only a vague idea of what they will be dealing with five days from now: the journalists reporting on the topics that happen around us. I think this influences the culture of organizations and how their general attitude towards the unknown is. Both are performance-oriented organizations, and I believe there is a lot to learn from both. And there is also a lot of opportunities to do things differently. ;-)
Staying connected: check-ins
These times are special. We don’t use our office like we used to do before the first lockdown. We decided to make the best of it, and many of my colleagues are not working from Berlin right now. Even before the first lockdown, we had a “digital layer” in our meeting setup where every meeting we organize always has a video presence opportunity. So we had some practice in attending virtually. We have learned that we are quite good with entirely virtual meetings where everybody attends digitally or meetings everybody attends in person. We also try to minimize meeting time to identify the right moments and setups when to meet, when we can coordinate using asynchronous channels like Slack or email.
All these things usually are transactional: it is either about updating each other, creating clarity and transparency, or making decisions. What is missing are all the serendipity moments where we just connected as social beings. We experimented with several ways like a discord server but figured that this does not work for us. Other formats work, and we continue to experiment. What also made a difference for us is accepting that not all formats work for everyone. So we have quite a few formats that are facilitated by different colleagues and two that are mandatory for everyone:
We have a weekly team check-in where everyone gets one to three minutes to say how they are doing. We have a culture with each other that we respect each other and take these meetings seriously. As we are around 20 people, everyone gets to speak. Some people share more, some less, and this changes week over week. I appreciate how we connect as humans in these meetings, and I usually am quite energized after the sessions.
Once per month, we do a meeting with everyone that took us some practicing: we start without saying a word and wait until one of us speaks up. It’s an exciting challenge to be quiet together, and most of the time, someone speaks up who usually is not the first one to say something. Topics range from small things people want to share, hidden conflicts that get addressed to personal issues. I feel proud that we have this safe space and trust in the team that my colleagues address the topics and that we do not immediately switch to “ok, let’s solve this” mode. Sometimes we can do something about the issues with a quick fix, and sometimes, being aware of them and taking long term actions is the way to go. We have been doing these monthly check-ins since way before Corona and have used some of our team offsite to getting to know each other. So it was easy to build on this.
These days, we are all missing the in person moments that we usually have in the social activities we used to do pre-lock-down. We all have learned that some of these moments are possible in virtual formats, but we all miss our two team off-sites per year that we use to connect, align and create transparency around what we are doing, how we are doing, who we are, and what we have planned.
Clubhouse on Tuesday:
Every Tuesday at noon, Ole and I meet with a friend/ guest on Clubhouse and talk about our interests. Usually, the topics are also interesting for a three-digit number of people. We do this meeting in German. So if you are interested in joining Lea-Sophie Cramer, Ole, and me on Tuesday, February 16th at 12:00, please join us. You find me on Clubhouse as @joerg.
Thank you for your time reading this; I hope there was something useful for you in my weekly mail, and please feel free to share it.
Have a great week
Joerg