Market size. A must is that the potential market size is at least nine figures for angel investor, even more for a VC. The larger, the better.
Clearly added value. Whatever is the product or service, it must add genuine value to customers and end-users.
Enthusiasm. The team either has it or not. When team pitching has real enthusiasm, it spreads around and causes positive domino-effect. One good thing leads to another.
As part of our series about “5 Things I Need To See Before Making A VC Investment” I had the pleasure of interviewing Kim Väisänen, Growth Partner at Evli Growth Partners..
Kim Väisänen is a serial entrepreneur and one of the most successful angel investors in Europe. Kim started his career by founding Blancco Ltd on 1997. He led the company for 15 years, growing it into an international category leader and a successful exit on 2014. After that, Kim has been focusing on private investments. He is angel investor in +10 companies, serving in the board of most of them. Since 2018, Kim has been Growth Partner in Evli Growth Partners, a later-stage European VC fund. Kim led EGP’s investment to Refurbed, one of the fastest growing ecommerce companies in Europe, and serves in its board.
Kim is a well-recognized columnist and blogger for several newspapers and online publications, as well as a popular public speaker in Finland. He is also the author of three best-selling Finnish books.
Thank you so much for joining us in this interview series! Before we dig in, our readers would like to get to know you a bit. Can you please share with us the “backstory” behind what brought you to this specific career path?
My path is typical for most angel investors. First you build your own company (hopefully successfully) and after you have (hopefully successful) exited, you help others to build their companies in the similar manner.
Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
Business books are too similar to mention but you can learn awfully lot by reading some of the world history’s greatest novels from writers such as Hemingway and Gogol. I love analogies and you can find quite a few great ways to adapt fictional stories to everyday business life.
Do you have a favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life or your work?
I would like to quote the King of Rock, Elvis Presley: “A little less conversation, a little more action, please.” As business friend once well thought: “Well-planned is entirely undone.” This is something that we all tend to forget from time to time in the era of over-communication and social media.
How do you define “Leadership”? Can you explain what you mean or give an example?
Good leadership provides direction for the team’s joint effort in a fair atmosphere. There are great examples in sports where coaches get an extra push out of teams that are considered to lose for sure. Good leadership enables the team to go for the legendary extra mile.
How have you used your success to bring goodness to the world?
I try to help start-up companies as much as possible, in all possible manners from occasional advices to being part of boards of directors and investing my own money in several financial grounds. Helping them is not a duty, it is a privilege. Just pay forward all those advices and help that you received during your own journey.
Ok, thank you for that. Let’s now jump to the main part of our discussion. The United States is currently facing a very important self-reckoning about race, diversity, equality and inclusion. This is of course a huge topic. But briefly, can you share a few things that need to be done on a broader societal level to expand VC opportunities for women, minorities, and people of color?
I have personally invested in several female established and run companies. I have done this on purpose because young men are not great listening my advices and hints. Female founders tend to do that better.
Too many investments are done in the similar type of companies and at least partially the reason is simply that old habits die hard. It is misleading to think that the same formula that worked ten years ago, would work now or in the future.
Can you share a story with us about your most successful Angel or VC investment? What was its lesson?
Framery is a company manufacturing soundproof office booths and private spaces. My journey with them lasted from one million to 65 million in revenue and took only about four years from investment to exit. The lesson is that when great team meets great market, amazing things will happen.
Can you share a story of an Angel or VC funding failure of yours? What was its lesson?
Never invest in market that is just too small. In most cases, the market in which you’ll invest should be at least nine to twelve figures. Anything under that will just eat your investment without any meaningful return.
For me a dear lesson on this was investing to junior ice hockey data service. The market is tiny and even if your market share were close to hundred percent, you cannot wait for any decent exit.
Can you share a story with us about a problem that one of your portfolio companies encountered and how you helped to correct the problem? We’d love to hear the details and what its lesson was.
There will always be those ‘darkest hour’ moments in start-up life when nothing works and everything fails. I believe that several times I have managed to calm my portfolio company down by saying: “Only headwind creates vikings” and explaining its profound meaning. Every entrepreneur encounters difficult times; if it were easy, everyone would be successful! True entrepreneurs will get immediately up when knocked out. Deep down entrepreneurship is how you cope the defeat.
Is there a company that you turned down, but now regret? Can you share the story? What lesson did you learn from that story?
There is always cases that you should not have turned down but Frank Sinatra captured it so well in My way:
Regrets, I’ve had a few
But then again, too few to mention
You cannot play the game of regrets but you surely should learn from your mistakes. Do not make the same mistake more than twice 😉
Super. Here is the main question of this interview. What are your “5 things I need to see before making a VC investment” and why. Please share a story or example for each.
- Market size. A must is that the potential market size is at least nine figures for angel investor, even more for a VC. The larger, the better.
- Clearly added value. Whatever is the product or service, it must add genuine value to customers and end-users.
- Who is the customer? If target customer group is ‘everyone’, it is better to walk away. The company that is pitching has clearly not done its homework if it cannot identify two to three customer groups or segments with relevant metrics.
- Homework. How well company has done its overall homework regarding customers, numbers, competition, its own products and services?
- Enthusiasm. The team either has it or not. When team pitching has real enthusiasm, it spreads around and causes positive domino-effect. One good thing leads to another.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Most movements tend to be dangerous so I am too cautious to name any but any movement that brings happiness to people’s lives gets my vote.
We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this. 🙂
LeBron James, if you are reading this, cheap lunch on me if I can ask about your secret sauce in life, sports and business.
This was really meaningful! Thank you so much for your time.