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Oxford Capital is searching for ambitious teams

This interview was held by Burak Buyukdemir and the article is written by Jeremiah Uke, contributor author at Startup Turkey

This is the first from a series of interviews with top venture funds in Europe by Startup Turkey. Meriwether Beckwith is the Investment Manager at Oxford Capital, a UK-based venture capital outfit, he is responsible for leading new investments, and supporting companies in the portfolio. Meriwether looks to back ambitious teams tackling huge societal or commercial problems. Meriwether had an interview with the Startup Turkey team where he talked about the methods used at Oxford Capital.

Oxford Capital is an early-stage fund based in the United Kingdom, Oxford Capital looks for startups in their seed and sometimes late-seed stage. Occasionally, they invest in companies that don’t exist yet, but most of the time they invest in companies that have a prototype of the product, sometimes with existing customers and revenues. Oxford Capital invests in the seed stage and keeps investing while providing support for the company.

” THESIS ” The mandate of Oxford Capital is broadly any companies that have software or digital technology at their core. This is because they have deep expertise in that area, but also, the reality is that companies using software tend to be able to scale bigger and faster than those that don’t. Some of the industries that we like include; Healthcare, Mobility and Autonomous Vehicles, Consumer brands, Agri-tech, and Industry 4.0. Each member of the team focuses on one of two of these fields each.

Oxford Capital mostly invests in the UK, the rationale being that they are based in the UK and prefer to cover the UK deeply, rather than spread to other geographies. Oxford Capital has invested outside of the UK before. Meriwether mentioned that the team made a strategic decision to try and focus on the UK and make sure they are seeing all the best investments in the UK, rather than seeing some of the best in the UK and other geographies.

SELECTION PROCESS ” Meriwether also explained the process of startup selection, according to him, 80% of the time, startups approach Oxford Capital, they mostly approach the team because they know the fund already. A lot of startups also get in touch with the team through email. A lot of the time, Oxford Capital reaches out to startups and entrepreneurs just as well.

For the process, it takes an average of about 24 days to go from first meeting a company to invest, that is about 3 or 4 meetings between Oxford Capital and the startup, going through some of the data and using the product of the startup.

RED FLAGS ”  One of them is founders disagreeing, fundamentally the team invests in people and teams, if those teams are already fighting then it’s likely to not go anywhere. However, Meriwether thinks it is important to have teams with a high level of mutual respect, this also means they can be comfortable challenging each other. Another red flag is when there is a sense that founders are trying to hide something.

STAGES ” Meriwether explained that the team interviews idea-stage startups and sometimes invest in them. Most of the companies the team ends up investing in their later-stage who have products and revenue, Oxford Capital met 75% of their founders when they were in the idea stage.

PRODUCT MARKET FIT ”  According to Meriwether “I think the product market fit depends on what the company is doing. I care less about revenue or customer number, I care more about the customers who really love the product and why they love the product, even if it’s 10-20%, It is a really good indicator. That is how I look at accessing the product market fit”.

ANTI-PORTFOLIO ” The team has had a couple of those, there is a number of them that are not unicorns now but they possibly will be, one of them is WeFarm, which is a knowledge-sharing network for farmers in Africa, they are growing incredibly quickly.

NEXT UNICORNS ” The fund has been around for 3 years. Two of the most successful companies are focused on the UK. Companies like Push Doctor which allows you to see a medical doctor within minutes on your phone, they are the UK’s largest digital health provider.

The second company is Moneybox, also based in the UK, it is the fastest growing investment platform for the UK and allows customers to save and invest.

FUNDING AMOUNT ” The fund invests up to 2 million pounds in the early stages. After which they can then proceed to invest up to 10 million pounds afterward. The fund has an unusual fund structure as the team is always raising money into the fund and always investing. The funds invest about $30 million annually.

HINTS ”  The connection is pretty important, but if you cannot establish a good connection, you have to understand that you need to do research to find which venture capitalist is more interested in your sector. Also, do not be afraid to reach out to a venture capitalist as long as you show them why you are relevant to them.

 

10 March 2019

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