What's the challenge of building a billion pound firm in Cambridge. Three veterans Suranga Chandratillake, (a partner at the $2.6 billion VC Balderton Capital with first-hand C-level experience of taking a start-up through to IPO), Martina King, (a former MD at Yahoo and CEO of Feature Space) and Monika Biddulph, (a VP at ARM) joined the panel at the to address the question at the Bradfield centre on February 1, 2018.
Adelina Chalmers, aka The Geek Whisperer® working her magic amongst the crowd!
The auditorium at the Bradfield Centre was charged up when co-organiser Adelina, aka the Geek Whisperer®, introduced the panel with an astounding level of energy setting the tone for the panel, who shared their rich entrepreneurial experiences and their thoughts.
Next it was the time for real scale-ups where a group of Cambridge entrepreneurs, Karl Gibbs (Founder of Acticheck), Jeremy Sosabowski (Co-founder of Algo-
Karl Gibbs, Founder of Acticheck, sharing his scale-up challenge with speakers, (from L-R) Monika Biddulph, Martina King, Suranga Chandratillake & Adelina Chalmers.
The experience of the panel and the audience together with the synthesis of issues faced by entrepreneurs flashed out a lot of hands on practical insights, with the following key themes.
Building a billion-dollar enterprise has a lot to do with ambitions of the founders and entrepreneurs along with their ability to listen and take feedback. Cambridge is pretty good at producing scale-ups with billion-dollar success stories such as ARM and Abcam, however, a vast majority of entrepreneurs are very happy to have achieved a few million dollars in revenue and are likely to exit early having made a small personal fortune.
The ambition of building something truly exemplary may need a different strategy, including:
- Partners: The ability to part with control of the firm while partnering with right sort of investors who could bring reach as well as significant funds to support the growth journey.
- Investment in growth: Focus on milestones in terms of market share and growth, and use them for funding milestones for raising patient capital, is a key strategy in building a large enterprise.
We know the drill more or less, but what are some of the things an entrepreneur wished she knew when things go wrong!
- Patient capital: The need for patient capital was re-inforced during the discussions and going for revenue too early can often take away the focus required for that high ambition.
- Walking away!: A very interesting alternative for the Founders, when faced with a deadlock with investors is the potential to walk away, let the company fail, and re-start in six months or so.
- Getting current investors approval for raising new investment: The CEO needs to make the call and move ahead with what's right for the business, especially if current investors are proving difficult (and not be restricted by their interest and ambitions!).
Where the product is at a point where you would like to scale and need customers/traction there are a number of challenges, including where to focus and where to invest.
- Metrics: Metrics are important to prioritise and identify the marketing effort that's going to convert into sales and bring revenue at early stage.
- Channel Partners: The right channel partner can really help scale-up the revenue along its supply chain. Clearly identifying differentiation for your product from existing competition is an important step to identify which customer segment to target.
- Geographical focus: What do you do if the demand for your product is spread all over the world and you have to meet you customers to convert to sales as often the case is in B-to-B space? It's either time to think about those metrics again in terms of time investment/return and additional effort to enter a new geographical market viz-a-viz focus on your initial/core markets.
- Open-sourcing: When it comes to a product which can be classified as an eco-system product with network effect, open-sourcing provides a really powerful way of scaling up through early adopters and evangelists.
The discussions with the panel highlighted the need to discuss and understand important issues for entrepreneurs, that's of VC culture and of gender bias, which is probably going to be themes for the follow-up episodes of this highly successful and exciting event, thanks to the joint effort of Adelina Chalmers and The Cambridge Wireless. I definitely look forward to it.
Article was written by Pradeep Debata.
Pradeep is an MBA from Cambridge Judge and is Founder of Accelerate East. Accelerate East supports enterprises through fund-grow-exit phase by preparing them for making deals, by developing and implementing KPIs, by undertaking focused research and through coaching/training involving running a growing firm.
He can be reached at firstname.lastname@example.org.
On March 15th, 2018, Pradeep will be speaking at Cryptocurrencies and ICO: Trends and Opportunities, the launch event for the Economics and Data Science Special Interest Group at The Maxwell Centre in Cambridge. For more information on this event, click here.
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