Seedrun

1. Can you give a brief introduction about yourself?

I'm Dan Shellard. I'm a partner at a VC fund called Breega. We are founded out of Paris, we now have offices in London and Barcelona. We invest early stage, anywhere from pre seed up to series A. I've been doing the job for a year having previously been a founder.

2. How did you get started in the field of investment?

I spent nearly 15 years as a founder. My last startup was invested in by Breega, which is where I got to know the team. When I was thinking about a transition, they kindly asked me to join the investment team. I've been investing for a year, but spent nearly 20 years in the tech ecosystem.

3. What industries or sectors do you typically focus on for investment?

Breega focuses on very generalist early stage. We've done a bunch of deep tech, some climate. As we write larger checks and do more Series A, we tend to focus more on fintech and insure tech.

4. What's your investment philosophy?

I think it's interesting having spent so long on the other side of the table that some of the things I really like to look for when backing founders is how they've thought through their distribution strategy. I think sometimes that can be a little bit overlooked, but ensuring you have the right unfair advantage when it comes to distribution, getting your product in people's hands, for me, sits above building a great product, because there's no point building a great product if people don't use it. So I spent a lot of time thinking about that. Obviously, understanding the founder fit and market size is super important. But, that's my philosophy.

5. What are the top three criteria you look for in a startup?

It's kind of what I just described. Obviously, you're looking for founders with a real drive and passion for solving the problem. I also like to see co-founders have a complementary skill set so that they each have a specific area of the business that they're responsible for and accountable for. But the number one thing for me personally, from my experiences of being a founder that I like, is those that have an unfair advantage when it comes to distribution and go to market.

6. Have you ever made an investment or formed a partnership through a networking event like Seed Run?

I've only made one investment and that wasn't via Seed run or a networking event, so the answer is no. But, it was interesting last time I did Seed run getting pitched the whole way round.

7. What trends in the startup world are you most excited about?

I wouldn't be able to answer this question now without speaking about AI and Gen AI. Gen AI is super interesting. I think it's very easy to get swept up in it, but we spend a lot of time thinking about where the defensibility is. There are a lot of application layer AI companies being built, which kind of lack defensibility. So if they have a unique distribution advantage, they can be quite interesting. Um, but yeah, I mean, solving some of the big climate challenges are very interesting. In the UK there are a lot of interesting climate businesses. And of course, my most recent investment in a company called Griffin, which is a banking as a service company that has just received their banking license. So I'm very excited about it.

8. Can you walk us through your due diligence process?

Breega’s process to make an investment is typically we meet a founder for the first time. If we like the founder and the company, we'll ask another partner to validate our thinking. If those two meetings are successful, then we have our investment committee up and running. So you'll meet the entire partnership. If that goes successfully, then we do an exploration phase, which typically lasts two weeks, where we'll spend a whole bunch of time with the team, getting to know them, and they get to know us. We deep dive into the model, how they plan to scale the business, the team. Then from there we shoot over a term sheet and do the regular legal process.

9. What’s a deal-breaker for you when evaluating a startup?

We're in the business of finding companies that can have outsized returns, that can build businesses to get to 100 million. So if the market size is not big enough and there isn't a path for them to get to 100 million in annual revenue, it's going to be very tough. So I think market size is obviously something super critical, but ultimately it all comes down to the path. So if you don't have strong conviction that the founders can build a big business, or have the desire to build a big business, that's definitely a deal breaker.

10. Have you had any investments that didn’t work out? What lessons did you learn?

None so far.

11. What advice would you give to startups looking to attract investment?

Wherever you can you need to try and build a relationship with the investor. Attempt to look for who the investor is rather than the fund. Obviously the fund plays a part, but you're going to be going on a long term partnership for seven to ten years, so you want to make sure that someone you want to have a close relationship with for a long period of time. if you can't get access to them or don't have direct access, I think it's trying to work your network, going to events and trying to get the relevant introduction.

12. What common mistakes do startups make when approaching investors?

I think investors get approached by many, many different companies, A really cold, generic email or LinkedIn request is not going to get much traction. I think it's all about finding a specific hook to get the investor in and trying to get an introduction.

13. How could we improve Seed Run?

Oh, that's a good question. What I would do to improve Seed Run is give me more time to train so I can be faster and not lose to your dad! He's quick. I was ahead of him at one point and, he comfortably strode past me. it's only the second time. I think it's a good event.