Yahoo Finance Top VC Eileen Burbidge reveals the biggest turn-offs when startups pitch
Eileen Burbidge MBE knows a thing or two about pitches.
Dubbed “Queen of the British VCs” by Fortune magazine, Burbidge is a partner at Passion Capital, a London-based venture firm that has invested in more than 70 early-stage startups since it was founded in 2011. Burbidge is also the chair of Tech Nation, a UK network for tech entrepreneurs.
“If we had this down to a science, I think it would be a … blockbuster book,” Burbidge said, speaking on Yahoo Finance UK’s Global Change Agents with Lianna Brinded show. The new video series delves into the stories of pioneering women across business, finance, technology, and academia. (Watch the full Eileen Burbidge interview here.)
Burbidge said there are some obvious red flags to look out for when founders pitch for funding.
Passion Capital invests in companies at very early stages, meaning tangible track records of past performance are often lacking. Instead, Burbidge and her team look to assess the people themselves.
“A lot of it has to do with the person’s interpersonal communications skills, their emotional intelligence, and how genuine they are about being passionate about what they want to do and the reasons they want to do that,” she said.
Just like in a job interview, founders are often on their best behaviour when they present their businesses to investors, so any unpleasant personality traits, such as rudeness, shortness, or impatience are “an immediate non-starter,” Burbidge said.
“You know obviously if that’s their best behaviour, then their day-to-day is probably much worse.”
That’s where other employees in the Passion Capital office can help Burbidge and her partners get a good gauge on a potential investment opportunity.
“We will ask the receptionist how they were when they checked in: ‘Were they rude? Were they polite? How was it?,’” Burbidge said.
“We might not get a chance to ask that for every single team, but we certainly pay attention if the receptionist comes up to us and says, ‘Who was that you met with earlier because they were a little bit off’ … Or they were just really a bit short.”
“That’s a non-starter … Done. We won’t even entertain that.”
The Monzo success story
One of Passion Capital’s biggest success stories is Monzo, the four-year-old, mobile-only bank that reportedly topped a £1bn valuation last year. Monzo claims on its website that 28,000 people open up an account with the service every week and that more than 1 million people use its debit cards to manage their money.
The Passion Capital team had previously backed Monzo co-founder and CEO Tom Blomfield’s previous fintech startup GoCardless, which he left in 2013. Burbidge said GoCardless has also gone on to become one of the most successful companies in Passion Capital’s portfolio. In February this year, GoCardless raised a $75m Series E round from investors including Alphabet’s Google Ventures, Salesforce Ventures, and Accel Partners. (Passion Capital also participated.)
When Blomfield came back to Passion Capital and said he wanted to fix retail banking, the team were “overjoyed” and raced to get on board, Burbidge said.
“I remember I shook hands with Tom in our conference room even before I could actually prepare the physical term sheet,” she added.
Monzo raised an £85m funding round in October, led by US venture firms General Catalyst and Accel, plus its existing investors. In December, the startup raised a further £20m in a crowdfunding round.
“The company being able to attract over £18m in less than three hours time from people who are users of the service and customers of the company is a huge gratification,” Burbidge said. “We are just ecstatic for the company and the founding team that they get that validation as well.”
Global Change Agents with Lianna Brinded is a new premium video series from Yahoo Finance UK. The show explores the stories of some of the most inspirational women across business, tech, and academia. Catch up on all the latest episodes here.
