Author: Anamaria Iuga

Venture Debt: A Q&A with Craig Netterfield from Columbia Lake Partners

This post is by Anamaria Iuga from Seedcamp

In the current surging rates environment, raising capital from VCs or angels has become increasingly expensive for companies, leading many founders to delay raising new rounds or to look for alternative sources of capital as the end of their runways loom.

Venture debt is one source of alternative financing that founders are increasingly turning to. Our Managing Partner Carlos Espinal chatted with Craig Netterfield from European venture debt specialist Columbia Lake Partners about:

– What exactly venture debt is? 

– What type of companies venture debt is suitable for? 

– How they “operate like a VC, but give loans rather than take equity”.

Carlos: How is venture debt different from traditional banking debt?

Craig: Traditional banks and venture lenders differ in three key areas:

  1. View of collateral. 

Most traditional banks will only consider assets (real estate, accounts receivable, re-sellable inventory, or machinery) as collateral for a loan. Less traditional banks will also view positive cash flow, even from asset-light companies, as collateral. Most banks will typically not loan to any loss-making companies.

Venture lenders typically lend to a much larger range of companies. This includes companies that are making losses if the cause of the losses is to increase enterprise value, for example, by growing revenues, creating intellectual property, or both.

  1. Lender protections.

Banks typically require loanees to keep cash deposits in an account at the lending firm. They also commonly use financial covenants as tools to help them manage the risk of their loans.

Venture lenders won’t use (Read more...)

Faks raises €5 million to digitize interactions between pharmacies and their suppliers

This post is by Anamaria Iuga from Seedcamp

During the COVID-19 crisis, the European healthcare ecosystem underwent an accelerated digital transformation. Despite significant progress, the pharmaceutical sector remains one of the least digitized sectors within healthcare, costing pharmacies financial and time resources and impacting their relationships with suppliers, partners, and, most importantly, patients.

This is why we are excited to back Faks, a Paris-based startup that offers pharmacies a digital, easy-to-use platform to manage all their after-sales operations, for all their suppliers, all in one place – from promotions and claims to expired products management. Founded in 2020 by Corentin Geoffray, a tech entrepreneur, and Clément Goupy, a former pharmaceutical representative, the digital platform streamlines the relationship between pharmacies and their suppliers and helps them work better together.

By using Faks’s platform, pharmacies are freed from considerable administrative work and can dedicate more time and attention to their patients. Furthermore, groups of pharmacies can more easily federate the members of their network. At the same time, Faks enables suppliers’ sales and support teams to gain operational efficiencies.

Victor Felguera, a Key Account Manager at Modilac Laboratory and one of Faks’s users, comments:

“By combining all the transactions negotiated with our pharmacy partners into one intuitive interface, Faks has given us real fluidity and saved our sales force considerable time.”

As proof of its value add to the pharmaceutical sector, Faks is now the leader in the French market. With a growing network that includes 12,000 partner pharmacies (60% of the French pharmacy network), 118 pharmacy associations, and (Read more...)

Welcome to Seedcamp VI

This post is by Anamaria Iuga from Seedcamp

$180M to back the next generation of Europe’s most exceptional entrepreneurs

Meet the team behind Seedcamp VI

It’s been over 15 years since we started Seedcamp. In that time, we’ve seen, well, a lot!

From navigating economic downturns and political crises to surviving a global health pandemic and bank collapses, we are no strangers to living through uncertain times. 

While volatility might be the current name of the game, at Seedcamp we are optimists at heart. Over this time, we’ve also seen the European tech ecosystem mature, professionalise, and join forces in times of crisis and experienced so many positive stories for Europe and across our Seedcamp Nation.

Now with a portfolio of over 460 companies – including 9 unicorns and two publicly listed companies – we believe we’re just scratching the surface when it comes to the talent and game-changing ideas to be found across the Continent. 

This is why we are incredibly excited to reach our latest milestone and launch our $180M Fund VI. Backed by 200+ of the world’s most impactful investors, this is by far our most ambitious fund to date. While the fund size may be larger (almost double that of Fund V), the entrepreneurial spirit of Seedcamp and the energy we bring around the teams we back remains very much the same. We believe now really is the moment to invest in the next decade of entrepreneurship. 

Community is at our core at Seedcamp which is why we are thrilled to (Read more...)

[Seedcamp Firsts] How to set up a fully remote and distributed team. Lessons from Maze and Gitlab 

This post is by Anamaria Iuga from Seedcamp

In a post-pandemic world, early-stage founders have multiple options for building their teams and choosing their ideal work mode(s). However, the decision between on-site, hybrid, and remote can be a complex one, involving multiple factors, such as access to talent, legislation, and people operations. 

While remote work became the default at the height of Covid-19, post-pandemic life has seen many organisations revert to old behaviours, pulling people back to offices and causing a fair deal of controversy in the process. 

April Hoffbauer, Vice President of People at Maze, Seedcamp-backed global and fully distributed startup Maze, still believes that remote and fully distributed offers an excellent opportunity for early-stage startups to tap into the global talent pool from day one.

Passionate about scaling thoughtfully and empowering great teams for long-term success, April is one of the rare people in the tech ecosystem who has been living and breathing all things remote since pre-pandemic life, and before words like hybrid working or fully remote were common language. Her experience as a Senior Manager Recruiting Operations and Insights at all remote tech unicorn, GitLab, where she supported and optimized the people team, equipped her with a set of best practices and tools to help build and scale fully-distributed teams. 

In her current role, April leads an agile people function focused on designing and implementing organizational development strategies that reinforce the company’s values, build a world-class culture, and enable greater effectiveness and scalability.

While remote requires a great deal of forethought and planning, (Read more...)

Cerbos brings its open source permission management solution to the cloud with $7.5 million in seed funding

This post is by Anamaria Iuga from Seedcamp

Authorization plays a key role in the continually shifting cybersecurity landscape. With more companies and organisations falling prey to cyberattacks and data breaches, permission management offers a viable solution to minimise the risks.

We are excited to announce our investment in Cerbos, a scalable, open-source authorisation layer for implementing roles and permissions.

Co-founded by experienced technologist and Seedcamp Expert in Residence Emre Baran, alongside Charith Ellawala (previously at Elastic, Qubit, and Ocado), Cerbos is on a mission to make authorization simpler to implement and manage. It enables teams to separate their authorization process from their core application code, making their authorization system more scalable, secure, and easier to change as the application evolves.

Emre Baran, co-founder and CEO at Cerbos emphasizes:

“Decoupling authorization makes life easier for both developers as well as product managers and security teams who create the requirements. Once implemented, the developers can focus on the rest of their job without having to deal with every change in access control logic.” 

With the help of the newly launched Cerbos Cloud, developers, and product teams can focus their efforts on building their core product and maxismising business value.

He adds:

“We are launching Cerbos Cloud today to take away the operational burden of managing, testing and deploying changes. Developers can now spend even more of their valuable time delivering great products instead of maintaining the infrastructure of the authorization layer.”

On why we backed Cerbos, our Managing Partner Reshma Sohoni comments:

“Cerbos’s open-source authorisation layer offers (Read more...)

[🎙️ Seedcamp Firsts] How to Lay the Foundation For Your Startup Brand

This post is by Anamaria Iuga from Seedcamp

With a background in consumer brands and communications, Joanna Christie has helped scale a series of well-known and loved brands at various stages, from Lyst to TreatWell. Now she is a VP of Brand & Marketing at Seedcamp-backed company Gaia – the world’s first IVF insurance product – where she is tasked with creating an industry-defining brand for a highly complex and first-to-market product in a highly emotional space. 

With over 10 years focused specifically on marketplaces, she has performance-led experience in building, communicating, measuring, and marketing brands B2C, B2B, and B2B2C. 

In a deep dive Q&A with our Head of Brand and Network Natasha Lytton, Joanna shares her best insights on how to lay the foundation for your startup brand and think strategically about the brand as you scale up.

At Gaia, we’ve chosen a brand that’s so at odds, so different from anything else in the fertility space. There’s no pink, there’s no blue, and there are no babies being dangled. That, again, is a message we’re putting out there to say this is different in a space that, sadly, is one that hasn’t got a great reputation. We want to stand out by being different and strong. 

Joanna Christie, Seedcamp Mentor and VP of Brand & Marketing at Gaia

Key takeaways:

  1. Brand is the first building block for anything you do as a business, not just marketing 
  2. When done right, the brand plays an important role in customer acquisition and retention
  3. Brand equity is built on consistency (Read more...)

How to Build Your Early Engineering Team: Selecting Engineers

This post is by Anamaria Iuga from Seedcamp

In Part II of his piece on building your early engineering team, our Expert in Residence, David Mytton, walks you through the five stages of selecting engineers. If you’ve missed Part I on sourcing engineering talent, you can read it here

Once you’ve sourced candidates, the next part is the selection process. I’ll break this down into five separate stages:

Stage one: Application

The best people never apply for jobs because they already know people internally, so they skip that process. However, that tends to be lower volume and you will still want to have brand new applicants applying through a normal process.

People applying will be sending their CVs through so you can do some very basic screening. A lot of companies just ignore the CV or only use it as a simple filter. Something that I used was to have a keyword that I required all applicants to put in their cover letter, even if there was nothing else in the cover letter at all. The keyword was in the middle of the ad, and that tested to make sure that the applicant had actually read the full advert. It allowed us to screen out most people who apply using a shotgun approach of sending applications out to hundreds of companies.

Stage two: Writing exercise

There is a direct correlation between the ability to write prose and the ability to code. The next stage that I always used was to have a short (Read more...)

How to Build Your Early Engineering Team

This post is by Anamaria Iuga from Seedcamp

Our Expert in Residence, David Mytton, shares his hard-won insights on how to build your early engineering team. Previously, as the CEO at Server Density, a SaaS cloud monitoring product (acquired by StackPath in 2018), he ran product engineering in a team of around 300 people before leaving in 2019. In January 2021, he launched, a free weekly newsletter for experienced engineers to find the best devtools and jobs.

How do you branch out and source candidates outside your personal network? What are developers looking for, and how do you stand out? How do you know whether someone is good or not? Do degrees or specific tech experience matter anymore? What are market salaries?

These are some of the key questions David will guide you through in his two-part article focused on sourcing and selecting engineering talent in early-stage startups.

Hiring developers is hard. Hiring good developers is even harder.

When building your first engineering team, as an early-stage company, you’ll go through two main stages: 1) Sourcing and 2) Selection. 

Before sourcing, essential preparation is answering some of the key questions a developer or engineer wants to know before they consider applying:  

  • What are the company values?
  • What are the standard benefits and the compensation package (e.g., health insurance, pension, etc.)
  • How do you work? What’s your development process? How does code land onto main? How does that get into production?
  • Who is on the team, and in particular, who do they report (Read more...)

Open-source platform Kern AI raises €2.7 million in seed funding to power data-centric natural language processing

This post is by Anamaria Iuga from Seedcamp

The advent of ChatGPT is just the tip of the iceberg of the emerging natural language processing (NLP) technologies and applications that are fundamentally changing human-computer interaction and, ultimately, our daily work.

With the increased adoption of model architectures and frameworks, developers are focusing more and more on improving the data used to train AI systems. Taking a data-centric approach enables them to use a set of common algorithms and then increase the number of training samples severalfold (e.g., from 10,000 to 50,000) or reduce the number of errors in the training data.

This is why we are excited to back Kern AI, a data-centric platform to power natural language products, workflows, and ETL pipelines. Founded by Johannes Hötter and Henrik Wenck in November 2020, the Germany-based company is building a platform designed for developers who want to implement data-centric NLP solutions. Its use cases range from internal workflows for operational or analytical purposes, such as complex customer-facing services, to building sophisticated NLP applications with their platform as the training database.

Johannes Hötter highlights:

“Kern AI aims to build software with an outstanding developer experience. We strive to provide users with the flexibility to create what they want and to reduce the time between an idea and its implementation. We are confident that Natural Language Processing (NLP) will continue to grow, and with Kern AI’s modular platform, developers have all the resources they need to deploy use cases. This is what we excel at and what we want to demonstrate (Read more...)

[Seedcamp Firsts] How to Lay the Foundation For and Implement Your First Strategic Partnership

This post is by Anamaria Iuga from Seedcamp

When done right, strategic partnerships can be transformative for early-stage companies. Joining forces with an established player in the market brings you much-needed validation and can help you acquire new customers and generate new revenue models.

Our mentor and executive at portfolio company, Elliptic, Elsa Said-Armanet, shares how to set the ground for and implement a strategic partnership. Based on over a decade of experience building and leading partnerships at companies such as Stripe, Twitter, and Google, Elsa’s insights will help you and your team successfully select a strategic partner, prepare and carry out your first negotiation, and measure the results of the collaboration.

Read our deep dive interview:

1. What are the first steps in building a strategic partnership from a startup’s perspective?

ESA: The first steps are internal. A Partnerships function needs to be integrated with and supported by a number of other functions within the company, typically product, sales, finance, marketing, and business intelligence. You need to define your partnerships strategy in the context of your startup’s priorities and those of your other functions, most notably product, and engineering, respectively, sales and marketing. Partnerships should build an internal flywheel where they contribute to each of these functions, motivating them, in turn, to support partnerships with user research, product development, partner marketing, and go-to-market support.

2. What should founders have in mind before approaching a potential strategic partner (e.g., a corporation, an institution, etc.)?

ESA: Some of these strategic partners could be foundational partners: (Read more...)