Ophelia Brown: How We Raised $432M in a Pandemic; What's New in European Venture Capital | E990

Ophelia Brown 0:00 Venture is a very transparently competitive sport. (instrumental music)

Harry Stebbings 0:05 Ophelia, I am so excited for this. Thank you so much for joining me today.

Ophelia Brown 0:09 Thank you so much. I'm thrilled to be here.

Harry Stebbings 0:11 No, I mean, honestly, the patience that you all have for putting up with this schedule, I'm very grateful. But I wanna start with you. So I always start with the wonderful world of venture in the entrance, but how did you make your way into venture and come to found Blossom? And, you know, short three to four minutes.

Ophelia Brown 0:24 I always say that Blossom is long in the making and short in the making. Long in the making, in that I think I always knew that I wanted to have my own company or build my own thing. My parents kind of taught me in the early days of, like, paying your own way, and I started with a side hustle trying to wash car windows at, you know, our house before my mum put a stop to that.

Harry Stebbings 0:44 (laughs)

Ophelia Brown 0:44 And then the big idea when I was a teenager was that I wanted to be a restaurant-owning DJ. Again, my parents put a stop to that. Went off to university, and when I started my MBA, uh, went off to INSEAD, I thought that was finally my journey into being an entrepreneur. And then I realized I had this pattern of bad ideas.

Harry Stebbings 1:01 (laughs)

Ophelia Brown 1:02 And the latest one that I was working on was a peer-to-peer car-sharing startup, like Zipcar without the assets.

Harry Stebbings 1:08 Mm-hmm.

Ophelia Brown 1:08 I was beaten to market, and I thought, "Okay, we've gotta kinda stop this." So-

Harry Stebbings 1:12 That was, that was the only reason you failed. (laughs)

Ophelia Brown 1:14 Yes. (laughs)

Harry Stebbings 1:15 Just beaten to market. (laughs)

Ophelia Brown 1:16 Yeah, that was... so, and I started thinking about venture, thinking, "Okay, if I'm gonna build something, I may as well learn the investment side and hopefully come up with a much better idea next time." And I was very fortunate to get a job at Index, uh, in their London office, and I just fell in love with the investing side. Like, I just loved enabling entrepreneurs, working with them, and I realized I, I was much better suited to that than building a company. But the passion to start something never really left, and that's why I say Blossom was short in the making, in that I kind of returned to being an entrepreneur and decided to raise my own fund.

Harry Stebbings 1:49 You said there about, um, enabling entrepreneurs. Totally agree. I, I would say, like, where you're world-class is bluntly winning. Like, no, really, you are unbelievable in terms of winning the most competitive deals, um, and so I'd love to understand just, like, when you think about your own hustle in terms of what it takes to win, why, why, why do you think you win s- such competitive deals, and what do you do to do that?

Ophelia Brown 2:10 When I want t- something to happen, I just focus on something making that thing happening. When it comes to working with an entrepreneur or wanting to support them or partnering with them, it's just relentless focus on achieving that, and I think I bring a lot of passion and just making things possible. Bluntly, I don't think I hear the word no. (laughs)

Harry Stebbings 2:32 (laughs)

Ophelia Brown 2:34 So, um, and I think probably the passion and the commitment and the dedication, I mean, it comes across. I think it's, you know, real. It's genuine. I'm not just doing it for the sake of doing it, like...

Harry Stebbings 2:46 Can I ask one

Harry Stebbings 2:47 weird one? How quickly do you know when someone's special? 'Cause often, I worry that I'm taken in by the salesperson. How quickly do you actually get excited and lean in versus it takes a bit of time to see how special someone is?

Ophelia Brown 2:59 I think about this a lot, and I think during a meeting, if you were kind of, if there was, like, a radar of, like, "I'm in, I'm out. I'm in, I'm out," I'm constantly trying to test myself. Like, "Okay, I've fallen in love within the first five minutes, but is this love, like, real? Are they just too much of a salesperson? Am I caught up in the pitch? Or, like, should I be more cynical here?" And the constant questions are kinda going through my mind, and I think the, I mean, I hate pitches, right? Whenever I meet with a founder, I'm always like, "Tell me your journey, and I want to understand why you're doing this and what your ambition is and what your drive is." And I think I come with a lot of questions 'cause I'm just trying to understand. I would say within, you know, the first meeting, for sure, I come out with a decision of go, no-go.

Harry Stebbings 3:44 How fast do you move post that? Because I think this is another thing where our industry's quite lethargic, and I, you know, I say this to Kieran, my partner. It's like, you know, "If it can be done today, it's done today. A reference call tonight? Let's do it tonight." Like, how do you think about the cadence post that?

Ophelia Brown 3:57 I think it's a balancing act, actually. Uh, I don't love moving super fast. Like, I think that actually becomes a perpetuating myth in the marketplace, like, "Blossom signed a term sheet within 48 hours." But actually, (laughs) like, from first meeting to 48 hours, that's not a reality. So I did the analysis. Now we're a few years in. I think we normally know founders for six to eight months pre-investment, sometimes a bit longer.

Harry Stebbings 4:23 Yeah.

Ophelia Brown 4:24 Because I love to get to know them, like how they work, how they execute, how they hire. Like, the investment thesis and decision whether or not to be inves- whether or not to invest is actually made pretty early.

Harry Stebbings 4:35 Yeah.

Ophelia Brown 4:36 And then there's a period o- of time. So-

Harry Stebbings 4:39 Can I ask a hard question? Um, well, I mean, ............................ Can I ask it? I'll just ask them anyway.

Ophelia Brown 4:44 Just ask the question, Harry. (laughs)

Harry Stebbings 4:45 Yeah. All right. Um, a lot of founders are like, "I'm heads down," especially the ones who've got, like, great seed investors or, like, are hot. They're like, "I'm heads down, and I'm not meeting investors." What do you do then when you wanna build the relationship, but their head's down?

Ophelia Brown 5:00 I get it from a founder's point of view. Like, "I've got better things to focus on," but, I mean, you and I know this from fundraising ourselves. There is so much to be said for the relationship that you build.

Harry Stebbings 5:10 Mm-hmm.

Ophelia Brown 5:10 I don't know how people would decide on a VC that they want to work with within, you know, 48 hours or a week, right? You want to know how that person's going to be able to support you, how they're gonna work with you, challenge you, open doors, and so I try and explain that to a founder who's heads down. It's like, "Okay, I would like, you know, 30 minutes of your time. I'm not gonna come with the bog-standard questions. I'm actually gonna use this to show how Blossom can bring value or how we can help and kind of earn my seat at the table for the next, you know, four, six, eight months."

Harry Stebbings 5:40 Sure.

Ophelia Brown 5:40 And most of the time, that works. There is also a flip side, I think, where, which I think has become more prevalent in the market recently, where founders have raised a lot of capital very early on and actually realize that they do need to build some product (laughs) and execute for a bit before they have more investor conversations. So it's also understanding where they are on that journey, whether, you know, you are six, eight months off a fundraise or you, whether you're 18 months off a fundraise and what the right time to engage is.

Harry Stebbings 6:09 Fundraising, actually-... can be fun if you're good at selling it because people just tell you you're great. And I think founders see this and it's like, it's enjoyable, but actually like cap it. So I always say like, have five names of partners in firms and actually meet them once a quarter for a year, and then you'll have a lot more data points where you can make a decision.

Ophelia Brown 6:25 Yeah. And I think the different thing about Blossom as well is, you know, when we're reaching out to s- uh, speak or spend time with founders, we're partners only at the firm. So it's not like you're wasting your time with us. Like, we try and give as much to the meeting as we can get from it.

Harry Stebbings 6:41 No, I, I totally get you. We mentioned kind of the joys of fundraising there, um, I obviously love it because I'm insecure and egotistical.

Ophelia Brown 6:47 You're very good at it as well.

Harry Stebbings 6:49 (laughs)

Ophelia Brown 6:50 (laughs)

Harry Stebbings 6:50 Um, thank you.

Ophelia Brown 6:52 (laughs)

Harry Stebbings 6:52 Um-

Ophelia Brown 6:52 (laughs)

Harry Stebbings 6:52 ... but it, it, honestly, a lot of it is like, it, it's a desire to be liked. Um, (laughs) -

Ophelia Brown 6:58 (laughs)

Harry Stebbings 6:58 ... and they like me. Um, but my point with that is, like, what

Harry Stebbings 7:02 are you running from? I think it's such a powerful question that reveals a lot.

Ophelia Brown 7:06 Oh, we're going deep.

Harry Stebbings 7:07 Yeah.

Ophelia Brown 7:07 Okay. Okay.

Harry Stebbings 7:08 I did, I did the softly, softly ideo dynamics now it's like-

Ophelia Brown 7:11 (laughs) You're asking the hard questions now, we're going to the deep, deep philosophical ones. So I actually did study a lot of philosophy when I was at university. It was part of my, uh, undergraduate degree. So, and I say that because, uh, it teaches you enough to know that from what you're running from, or everything about your life is basically trying to escape from the very reality of mortality. That life is finite. Um, so that's why we busy ourselves, that's why we seek enjoyment in things is because if you were kind of per- uh, paralyzed with nothing to do, you would then end up worrying about that.

Harry Stebbings 7:45 (laughs)

Ophelia Brown 7:46 (laughs)

Harry Stebbings 7:46 Wow, we went, we went deep there, it was not expecting that, we went to mortality. Uh-

Ophelia Brown 7:51 Which is more about an enjoyment of life. Like you, I'm trying to take every minute that I can and make the most of it.

Harry Stebbings 7:58 I love that. I, I totally agree. There's a brilliant quote from, uh, About Time, um, which is about kind of making every day like truly wonderful. Which I love, but that's like very soppy, uh, movie choice. (laughs) Uh, I'm losing all streets-

Ophelia Brown 8:11 But there's truth to it.

Harry Stebbings 8:12 ... right now. There is truth to it. And Mickey Malka, because I spoke to him before and he's obviously a mutual friend of ours, and he said that you got some advice when starting Blossom. And he asked me to ask, what was this advice and how did it impact your thinking?

Ophelia Brown 8:23 I love Mickey. Um, Mickey's one of the people that I respect the most in venture, um, and certainly someone I went to very early on because he had started his own fund, and, uh, I think he's done tremendously well. There's a lot of advice that Mickey gave me and some you can only follow if you're Mickey and then-

Harry Stebbings 8:39 (laughs)

Ophelia Brown 8:40 ... some (laughs) you can't follow if you're a mere mortal. (laughs)

Harry Stebbings 8:43 I got, I got that too, and I was like, "Ah, maybe not for me." (laughs)

Ophelia Brown 8:46 I mean, the one thing that, uh, really resonated or I took away from was that, you know, he told you, you have to really follow your own judgment and believe in you and do things your way. And I think that serves a lot. Like, in the beginning when you're starting something you're so unsure of what's right and what's wrong, or whether you do it one way or whether you build for one LP, et cetera. Uh, but he was very fixed on like, you just do it like that. And my big thing was whether I started as a single GP, and obviously Mickey is a single GP. His piece of advice that I couldn't quite follow, which, you know, hats off to anyone in venture if they achieve this, is you know, do one and done close as a first time fund.

Harry Stebbings 9:24 I love that and I think that's so true o- on the GP side, I think it's kind of like knowing your strengths. I, I do want to dive on kind of Blossom itself because, like, speaking of knowing your strengths, I think you're a phenomenal picker and when we think about portfolio construction,

Harry Stebbings 9:37 like, how do you think about how many companies, the right level of diversification, and how many is enough?

Ophelia Brown 9:44 So this is where we differentiated the model quite a bit. Um, so we said we wanted to build a new fund specifically for early stage in Europe, and our general view is that Europe is a growing ecosystem and there's a lot of promise here but it's not the size of Silicon Valley.

Harry Stebbings 10:00 Sure.

Ophelia Brown 10:00 So that means there's going to be a finite number of companies that are built every year in Europe, and we just want to be the best possible partner to those companies, uh, and adequately support them as we can as a team. Um, and so rather than try and build a fund of 30, 40 companies, and then, you know, build that over two, three years, we said the, you know, the number of quality companies that we can be great partners to is actually probably smaller than that, and let's be super concentrated. So 15, 20 companies per fund, and try and be the best possible partner to those teams.

Harry Stebbings 10:34 So when we think about that, sorry I'm just running through the numbers now, so you have like 475 million, and then you have 15 to 20 companies. So that's like 20 million per check?

Ophelia Brown 10:43 Yeah, so the 475 will be more like 20 companies rather than the 15. So fund one was 10 companies, fund two is 15 companies, and fund three will target 20.

Harry Stebbings 10:52 Okay, so we've got-

Ophelia Brown 10:52 So that kind of grows in line with the growth of the European ecosystem.

Harry Stebbings 10:56 Goshies, we've got 20 companies. Do we have, like how do we think about reserves and reserves management?

Ophelia Brown 11:01 So we actually don't reserve the standard. Uh, and this is something I think I learned from previous venture experience when I was working for other funds is that, I think actually like the follow on can really damage fund returns, in that, you should buy your ownership at the lowest possible cost, which is the initial cost of seed or Series A. And then especially in the growth market that we've been on where, you know, the follow on is done at 4 or 5 X, and not a lot... I mean you're somewhat de-risked but you're definitely not completely de-risked to the point of a growth investment. So you could be spending an additional... You know, say your initial cost was five or 10 million, and you were spending an additional five or more in pro rata, but at a much higher valuation, then your blended average suddenly looks a lot worse than having just bought your ownership at a lower cost. So we said we're just going to do initial investment with a very small amount of follow on if our companies need help getting to an exit or struggle to raise. And so 90, 95% of our investment will be for initial.

Harry Stebbings 12:03 So I, I totally get you and I, I agree with you. The difference between our structures is like, in my current fund structures, I generally do it with a co- like a lead investor.

Ophelia Brown 12:12 Yeah.

Harry Stebbings 12:12 And so blindly I'm not on the hook for it when there's a bridge round needed or like now when even you can have great companies, but Series B investors are kind of few and far between if you're not in AI. Are you worried that your reserves...... ratio or lack of will actually suddenly be very needed by a generation of Series A ambassadors, uh, or Series A founders that don't have the Series Bs as readily available as they were in the last few years.

Ophelia Brown 12:35 No, because the ... And this is where I'm actually quite proud there are, uh, you know, how we've supported founders and how we've thought about capital efficiency in the way that you spend capital actually hasn't changed between like the boom of 2020 to 2022, to from before that and to now. In that, we've always said to founders, "Be in control of your own destiny. Manage your runway and your burn, and don't expect that a raise is just, you know, automatically 12 months out."

Harry Stebbings 13:04 Yeah.

Ophelia Brown 13:04 Like, you have to be able to control how fast you grow or not. And when we fund them at Series A, we say, "You know, here's enough capital of a 24, 36 months post our investment." And let's be honest, if you can't raise capital after that point, you probably aren't building a viable business, and we feel that that's enough runway for you to really give it your best shot, and we'll work with you all efforts beyond that. But if you can't after that and you've run out of cash, you know, it's not our ... We shouldn't be investing more to extend your runway. I think we just have to be honest. At that point, there wasn't a viable business to be built.

Harry Stebbings 13:41 I know. Listen, I, I, I do agree with you there. I guess my question is, so on the sell side, when you're selling an entrepreneur, often I get founders that say, "Ah, I have a, you know, X multi-stage fund. They can do the B, they can do the C, they can continuously reinvest." How do you kind of combat that argument when you're trying to sell a founder?

Ophelia Brown 13:59 But the reality is, even for a multi-stage fund when they could theoretically do the B, C, D, they're still underwriting that new investment. It's not like they blanket just give you-

Harry Stebbings 14:11 (laughs)

Ophelia Brown 14:11 ... the B, C, D.

Harry Stebbings 14:12 (laughs)

Ophelia Brown 14:12 Like, you have to perform in order to get that capital. And actually, by us not investing at that stage, we are so aligned with the founder in trying to get them the best possible raise at the next round. So w- we're just trying to focus them on building a viable business. And so it's actually never been an issue with a founder when we're talking about investing.

Harry Stebbings 14:31 Can I ask,

Harry Stebbings 14:32 how do you tell a founder that you're not gonna reinvest? It can be a difficult one. If they just even expect a little bit, but say a company's not performing, how do you del- deliver news that actually I'm not gonna invest again?

Ophelia Brown 14:43 Well, I think because our default upfront is, you know, we're not investing at the B, C, D, and this is why we want our ownership at the A, it's not actually a hard conversation. And also, we work so closely with the teams that I would say, you know, founders themselves normally know when it's working or n- not working. It's not coming as a surprise. Like, we're working through, like, you know, there's a project, there's a business plan, these are the KPIs that we're working towards. Every month, we're talking about what's working, what's not working, if not, like, beyond, uh, more frequently than that. And so I don't think it ever come. Like, the relationship, it should never come to a founder as surprise as what you're thinking.

Harry Stebbings 15:18 Yeah.

Ophelia Brown 15:18 That's my philosophy. Like, then you've misled them somehow.

Harry Stebbings 15:22 I, I find that happens a lot, though, especially in Europe, where it's like, "You're doing great, Ophelia. You're doing great." And then three months before fundraiser it's like, "We're not actually in a position." And it's like, "Really?"

Ophelia Brown 15:31 I think a lot of funds have earned a really bad reputation that way, where founders have come back and thought this whole pitch, oh, they underwrite all of the next rounds, and then they turn up at these investment committees where a bunch of partners also have no idea what's going on in the company. And they're like, "I turned up at this partnership meeting and, you know, no one knew what we were doing or how we were performing, and suddenly I don't have a term sheet."

Harry Stebbings 15:52 I, I think IC is the most inefficient decision-making processes ever (laughs) . Like, genuinely, you turn up in a space where you're not ... You know, you often have these big general partnerships, like, you know, the fintech partners, like, chiming in on the consumer social deal. They don't know, they don't know the bandage marks well. They haven't really met the founders more than once other than the partnership meeting. It's like, "Uh, yeah, I agree."

Ophelia Brown 16:08 That's why we did away with the IC at Blossom. It just didn't make sense when your, uh, uh ... From what I saw before is that there would be a subsection of the team or one partner or two partners that spent an incredible amount of time with a company, built a thesis, and then, as you say, a lot of other partners come to it fresh with 45 minutes. Like, how can you judge from that time?

Harry Stebbings 16:29 Sure.

Ophelia Brown 16:29 So much goes into building a business. Like, it just became ... I feel like the IC formed a very political environment.

Harry Stebbings 16:35 I, I, I totally agree with you. Do you agree with signaling? A lot of people say, "Oh, there's incredible signaling risk," and then, uh, (laughs) a lot of other people say, "Ah, it's actually over-exaggerated." Do you agree with signaling risk and how do you advise founders on it?

Ophelia Brown 16:48 There is signaling, but it ... A good investor doesn't necessarily pay attention to those signals. You know? You shouldn't be worried about whether X is investing or not investing or this or that. Like, you should have the courage of your own conviction. And this is why we talk about high conviction investors.

Harry Stebbings 17:04 S-

Ophelia Brown 17:04 Like, you have to decide whether or not you want to make that investment. You have to decide what the inputs are that you place value on. The rest of the signaling, don't worry about it. And think about how many great outcomes have been where the journey has not been straightforward, you know?

Harry Stebbings 17:19 I, I don't think it's ever straightforward, like ever in any great company. I think you've ... I, you know, I've seen many times before it tweeted, but, like, every single company that you see today up and to the right, it was so not up and to the right. Uh, can I ask, you know, we, we spoke about that decision-making process and, you know, working with the founders. I take the view, honestly, that I can help you hopefully be greater than you are. But honestly, the best founders do not need me. Uh, do you agree with me in terms of saying the best founders do not need our help?

Ophelia Brown 17:46 The best founders will still be best founders, they'll build great companies. I think there are ways that you can find to be helpful.

Harry Stebbings 17:53 Totally.

Ophelia Brown 17:54 Like, you know, if I take, uh, Guillaume at Checkout. Guillaume's going to build a great business whether or not Blossom has invested or not, but I can earn the right to feel like I contributed something by working incredibly hard-

Harry Stebbings 18:06 Sure.

Ophelia Brown 18:06 ... for him in the business. So, I think that the best founders see how they can draw on help and how they can kind of make people y- be valuable to them. But, of course, like, a great entrepreneur will always be a great entrepreneur.

Harry Stebbings 18:21 No, I, I totally agree. I think the thing that I see when I look at, like, the companies that work and those that don't for me is speed of execution.... it's the biggest determinant of success for me when I look at companies that work. Do you agree with me on speed of execution being the most important thing when you think about what's worked in your portfolio?

Ophelia Brown 18:37 Uh, def- definitely speed of execution. There's, uh, courage in the conviction of ideas, um, and how to move on things. Um, you know, there's no analysis paralysis, et cetera. Um, the, the best founders, like, there's something a bit difficult about them as well. Like, the, the, you know-

Harry Stebbings 19:03 Do you always get that pre-investment?

Ophelia Brown 19:05 No. (laughs) You-

Harry Stebbings 19:06 You just see a post? (laughs)

Ophelia Brown 19:08 You, you... No, I mean, I mean, as you know, it's, I mean, incredibly hard being an entrepreneur. You have to make 100 decisions a day. Some of them are not gonna be favorable, some of them are gonna be difficult, and sometimes if you decide to go down one path, you can't be fazed by every decision. You just have to be, you know, cross the chasm, go for it.

Harry Stebbings 19:28 This is a bit of a deep one, but I mean it applied to investing. How do you think about your relationship to regret? Naturally, you make a bad investment and you regret making it. How do you think about that relationship to regretting as an investor?

Ophelia Brown 19:43 I don't have regret, I have learning. Uh...

Harry Stebbings 19:46 (laughs) Sorry, that was brilliant. That was like I worked too hard in a job interview. Okay, you have learning. And so you then reflect on it? Like, do you actually, like, do a session and think, "What did I learn from that?"

Ophelia Brown 20:01 Absolutely. I remember o- one of the first investments that I made, uh, when I was at Index and t- the company was performing so-so and Neil asked me, he said, "What's your learning from that?" And that really stuck with me. I was like, "You must take something away from a bad investment." Like, it wasn't just bad picking. Something happened afterwards as well. So what did you learn and what, wha- I, I do fundamentally believe in never make the same mistake twice.

Harry Stebbings 20:29 Sure.

Ophelia Brown 20:30 So, there was always things to be-

Harry Stebbings 20:32 What do you think is the biggest mistake you've made? I'll be honest with mine too.

Ophelia Brown 20:36 In a, as in picking investing or...

Harry Stebbings 20:38 As in when you reflect over your track, you're like, "I made this mistake." So I invest in a company and on paper everything was great. Numbers worked, cohorts worked, economics worked. And there was enough data and it was at a stage where you could actually make that assessment. But the geography was one that I was not familiar with. (laughs) And, uh, th- there were things that happened in that geography which I was totally not accounting for in my very rigorous, but academic assessment of a not real world.

Ophelia Brown 21:08 And I think that's really important. So, I think investors can get fooled into thinking something is a great investment thesis and ignore the practicalities of the ex- execution and execute some risk, et cetera.

Harry Stebbings 21:22 Yeah.

Ophelia Brown 21:22 So I think a lot about that. Like, you can build a beautiful investment thesis around why a piece of software might work, but if the team isn't right, or the geography isn't right, or there's something wrong with the market, then you'll still be wrong.

Harry Stebbings 21:33 Totally.

Ophelia Brown 21:33 So, I'd take away a lot from, you know, was it team, was it market?

Harry Stebbings 21:38 So what was your biggest mistake?

Ophelia Brown 21:41 I've definite- I think the biggest mistake is team, always.

Harry Stebbings 21:45 Where you made sure-

Ophelia Brown 21:46 Misjudging something on team.

Harry Stebbings 21:48 You thought they were better?

Ophelia Brown 21:51 It comes back to execution speed.

Harry Stebbings 21:53 Yeah.

Ophelia Brown 21:54 And this is why I love to know teams before investing.

Harry Stebbings 21:58 Yeah. No, I, I-

Ophelia Brown 21:59 I think the other thing, um, uh, is e- and I learned this early on, is that you can kind of, uh, suppose that y- you are going to do the building. So you can throw a lot of ideas at a founder and say, "Oh, but if you do this and do this." But they have to want to do it. Like, the, the ambition, the drive, the ideas. So that I learned very early on.

Harry Stebbings 22:23 It was funny, when, you know, when I was working with Fred at Stride, I always had the Fred test. Fred is a brilliantly smart, uh, operational mind, um, and I always have, would I rather back Fred as the CEO or the CEO? And, like, 98% of the time I would rather back Fred as the CEO, and we'd come out of meetings together, I'd be like, "Uh, can I invest in you as the CEO of this business?" And we were like, "All right, done. That's it." Um, and so that was a big thing. Y- y- you said there about kind of learnings. Um, I have to ask, um, you know, we see a lot of, uh, scout programs. I think, you know, every big fund has a scout program. Y- you did the Blossom scout program. Uh, they didn't work. Why didn't it work and what were the learnings from that?

Ophelia Brown 23:03 So we were really trying to innovate on this concept of scout program and taking what has worked in the market and what hasn't. And so, uh, Blossom wasn't doing pre-seed well seed and there were lots of founders that we thought deserved to raise capital, but they just weren't for us. And so we wanted to, on one hand, kind of enable some, enable them to be successful in their fundraising, and on the other hand, there were loads of operators in Europe that were starting to think about angel investing and they might have a deal flow, but they wouldn't have time in terms of judgment or they didn't have the capital, et cetera. So, we said we'll create an angel program where I think it was 15 angels, operators, and some really great names. And we said, "We already have the deal flow. We're gonna bring you the ideas. You as a group form the IC and decide whether or not you want to invest, and then we'll facilitate the administration and the capital, et cetera." Uh, it was meant to be 250,000 per investment and it was a great idea, but it was just as, as I said, all these angels was, uh, all these operators were starting to be angels and actually what founders wanted was a 10K check from one angel and a 10K check from another angel. They didn't want a group at 250.

Harry Stebbings 24:16 Oh.

Ophelia Brown 24:16 So it just didn't work for the market.

Harry Stebbings 24:18 No, I totally agree. I, we actually host, uh, d- dinners here and we had an angel dinner the other day with several, uh, people who were angels and they were scouts and they were like-... the best deals are going in my angel checks. 'Cause I, and, and it's not because I'm being devious, it's just 'cause I turn up with the scout cheques.

Ophelia Brown 24:33 Yeah.

Harry Stebbings 24:33 And they're like, "Oh, no, no, no, we don't want the name of that." Like, w- "No, we take your money, not the fund money." And I thought that was really interesting that actually was a real pushback. Why don't you do seed though? Like, uh, if you look at, um, what, really every big fund now, they've all aggressively moved towards seed, which is why I send you all of my deals. Um, uh, why, why didn't you do seed?

Ophelia Brown 24:54 So we actually pulled out of seed, uh, I think it was the same time everyone decided to go-

Harry Stebbings 24:58 (laughs)

Ophelia Brown 24:59 ... into seed. We were like, "This-"

Harry Stebbings 25:01 Contrarian and-

Ophelia Brown 25:02 It was very Hopefully right. ... Hopefully right. I do worry, actually, when I look at all of the deal activity in Europe, that it's all at seed stage at the moment, and it's, you know, the multi-stage funds, new seed funds, et cetera, and we said, "No, we're just going to stay to our swim lane and just do series A." And I think there was a combination of things. I think for a seed fund, you need diversification.

Harry Stebbings 25:24 Mm-hmm.

Ophelia Brown 25:24 Because there are things outside of your control. Again 100%-

Harry Stebbings 25:27 100%.

Ophelia Brown 25:27 ... on the best investment thesis you can write.

Harry Stebbings 25:29 Yeah.

Ophelia Brown 25:29 But things that, you know, the loss ratio at seed is just much higher than A.

Harry Stebbings 25:33 Yeah.

Ophelia Brown 25:33 And you probably do need that diversification, whereas it's not so conc- it doesn't suit so much a really concentrated strategy.

Harry Stebbings 25:39 Yeah, I ran the numbers. We have 40, and it's 'cause at 40, when you run a Monte Carlo with a fat tail, you get, like, 92% of the benefits of diversification, but at 23, you get, like, 75.

Ophelia Brown 25:49 Yeah.

Harry Stebbings 25:49 So it's like a, actually a reasonably big drop, actually.

Ophelia Brown 25:52 And the other thing is, you know, where we feel that we can add value as partners is really at that inflection point when you come to A, where you have some initial signs of product market fit and you want the capital to help you scale to that predictable and repeatable revenue stage. Like, that's where we feel that, as our expertise, we can really help companies. And at seed, it's much more about finding PMF, and we didn't feel as, you know, VCs that that was so much of our, where we could help. I think there are some VCs that are really good at that. But also, a lot of finding PMF is within the founder's control, that you started a company because you have an idea of something that needs solving or a product that has to be in the market. So what can we tell you from a product perspective? Probably not much at that point. I also think when it comes to hiring at seed, you know, a lot of the hiring is from your network. It's not where you're thinking about that, you know, the first hire that's out of your reach, where kind of m- my investor really helped me get that incredible VC s- uh, sa- v- VP sales or incredible VP talent.

Harry Stebbings 26:55 Do you take board seats?

Ophelia Brown 26:57 Not at the A stage. So our model, because we only make five investments a year, coming back to the concentrated approach, we have three partners, and we say, "All of us support you at that stage." So when it comes to the point of appointing a board, you, you, A, know the bottom partnership really well, so you can decide who, which three of us you want as your board member. But also, the support that you need at the A stage is different from the board kind of governance and the role of a board. Like, we're just very much here to help you in the build stage. So we meet regularly. We have onsites with all of our teams every month. We have WhatsApp groups. Like, you know, we're very regular in contact. But it's not a board forum. It's much more, "We're with you as partners. We're an extension of your team. Let's think about, you know, how the business is tracking, have these strategic discussions. But you're not quite ready for that board format yet."

Harry Stebbings 27:47 It's a weird thing, where the conventional wisdom is that you shouldn't have boards too early. But the more I do pre-seed and seed, the more I think you should have them as early as humanly possible. And I do, and it's- it's not an arrogance. It's just like, as an ambassador, you see hundreds of different situations. And you can stop people doing really silly things, which, when you're so ingrained in what you do, don't seem that silly. I've done them as a founder. I'm sure we've both done things as a founder, you're like, "Oh, I was obviously wrong." And I'm like, "That could have been so easily stopped had there been some form of controls, uh, sounding boards, that was more formal than just the investor update," that you mostly honestly just get as a pre-seed and seed investors.

Ophelia Brown 28:25 So that I agree with. Uh, but that's why the structure of our support... And also, you can get all of the governance rights, et cetera, and the shareholders' agreement doesn't have to be at the board level. What you need to facilitate is what you're saying, is like, you want regular communication. You want insights into what's going on. So you can... We always say, "We want to know the bad news as quickly as possible" because that's how we help you figure it out.

Harry Stebbings 28:49 Yeah. No, I mean, also, I think as you kind of scale, not a bit like the really silly things, like going after a completely wrong ICP, you don't do it as much, because you have the data. You have a lot more understanding. It was Dev actually at MongoDB that said, "The thing with information is it flows at different velocities." Um, good information flows very quickly to you, and bad, uh, somehow takes a lot longer. Um, uh, (laughs) which I thought was actually really good.

Ophelia Brown 29:13 And it's true, and I've, uh, I feel that after the investment, you work so hard at building that relationship with the founder to make sure that they feel comfortable giving you the bad news, because that's how you support. You know, mm, as we said, not everything is gonna go uphill, right? There are going to be all kinds of problems. But if you feel comfortable sharing, like, just so you know, we worked so hard to win the investment, and win being your partner, we worked really hard to help you solve that.

Harry Stebbings 29:40 I know. (laughs) Um, I know, no, I n- l- listen, we are very honest with each other. Um, you have the most stellar founder references from people that work with you. Like, it's really, like, I j- I tweaked it when I did them, but it was fantastic to see. And you mentioned that, like, "Oh, I sometimes regret, oh, we don't do seed." Um, FOMO is something that I- I struggle with, everyone struggles with, um, I hope. Um, do you struggle with FOMO, and how do you think about that kind of regret minimization on deals that you didn't do? (pen clicks) There we go. (laughs)

Ophelia Brown 30:07 So FOMO investing has never quite made sense to me. If at, you know, the early stage, it's all about seeing something that someone else doesn't, then there shouldn't be...... 15 timesheets for a deal because that means everyone's seeing the same thing and I actually try and stay away from those kind of deals because-

Harry Stebbings 30:28 Do you know, sorry, I'm jumping in, but do you not think with the commoditization of data that we have today, like there are literally, we have four data platforms here which track everything from headcount growth, revenue growth, Alexa, web rankings, everything. And I know that all the other multi-stage funds have them too. One of my friends is, like, a very pedigreed operator and they got 28 pings from associates on one day because they showed up on a data platform. And so literally-

Ophelia Brown 30:51 That's not thoughtfully investing, you know, they-

Harry Stebbings 30:54 No, but we've moved from this cottage industry to this, like, low margin, um, high velocity business, whether we like it or not. And so is it possible to still do that?

Ophelia Brown 31:05 Uh, the last five deals that we've done, there has been a s- like, no competitor, no single competing timesheet. And I've, I mean, we could be doing something horribly wrong, but you were with me in one of the last investments-

Harry Stebbings 31:21 Yeah.

Ophelia Brown 31:22 (laughs)

Harry Stebbings 31:22 When then suddenly, there is, like, a competitor

Narrator 31:24 (laughs)

Harry Stebbings 31:24 ... suddenly.

Ophelia Brown 31:25 But I mean, that, that's yeah, great, and so I go to, we, you know, sign the timesheet and they got called up by a competitor fund that same day being like, "Don't sign, we're coming to take you-"

Harry Stebbings 31:34 (laughs)

Ophelia Brown 31:34 "... out for dinner." Like-

Harry Stebbings 31:35 Yeah.

Ophelia Brown 31:35 ... "Don't sign." I mean, how can you-

Harry Stebbings 31:37 (laughs)

Ophelia Brown 31:37 ... in, like, interject on a deal so late in the process? Just-

Harry Stebbings 31:42 I mean, it's gotta be a great dinner, doesn't it? (laughs) I mean, you are counting on a full works dinner there.

Ophelia Brown 31:48 (laughs)

Harry Stebbings 31:48 Um, I, I, I love that. Um, when you're thinking about this, like, one thing that I think about, and I actually I think about it even more so today but it's just, like, pricing

Harry Stebbings 31:56 and, yeah, how do you reflect on your own relationship to price and when to pay up and when not to?

Ophelia Brown 32:03 It comes back to the philosophy of there are only a finite number of outcomes that are gonna matter each year and you just want to be the best possible partner to them. So, and for our fund model, you know, we're pretty explicit that we want 20% ownership because if you're going to be one of 15 or 20 companies, we really want you to matter in the portfolio and we're gonna work incredibly hard to help build value, et cetera. Um, and a function of therefore price is, you know, how much capital do you need to scale your business the next 24 months when you arrive at valuation. If you're, like, plus or minus around the margin and you've decided that one of five businesses you want to partner with that year, it, it doesn't matter that much. If you are moving away so far in price that you can't believe that this company can be material to you and therefore to your LPs, I believe that's stretched too far.

Harry Stebbings 32:57 Can I ask, 20%, that, that is, to me, like, a time, uh, gone by that I look at fondly, but I mean a time gone by. Like, do you worry that actually it's a little bit of adverse selection just because, like, I, I, I don't know many funds at all that get 20% consistently anymore?

Ophelia Brown 33:16 No, I don't worry about adverse selection.

Harry Stebbings 33:19 (laughs)

Ophelia Brown 33:20 I look at, you know, the quality of the founders and the companies that we've partnered with and I think-

Harry Stebbings 33:24 Do they push back when you say, "We need 20%?"

Ophelia Brown 33:28 Not all the time, but it actually becomes easier the more proof points that you have of the how we can support that. You know, if we, if you can point to Pigment and Tines and Checkout and Loompay and Spacelift and, you know, they're great companies in concert with you in c- in, like, in the Blossom portfolio where we've ha- brought in great investors afterwards and, you know, you see the rise in valuations, et cetera, I don't think founders mind.

Harry Stebbings 33:58 Yeah. I, I get you. (laughs)

Narrator 34:00 (laughs)

Harry Stebbings 34:01 Does it not make it also harder to construct rounds? 'Cause it is a, a large chunk of rounds. I mean, if you're gonna bring other people in, you're gonna be diluting 25, 26%.

Ophelia Brown 34:11 So we don't, uh, we lead. We don't work with other VCs. So, uh, we might work with occasional angels that want to be alongside with us but that's at the founder's choice. Like, we obviously make introductions to people that we think are gonna be relevant, but the founder will choose.

Harry Stebbings 34:26 Yeah.

Ophelia Brown 34:26 But, uh, at the EA it's a bit, it's not like seed. There's not room for more than one investor in.

Harry Stebbings 34:33 Yeah. I think a generation of investors disagrees. What do you say to them?

Ophelia Brown 34:40 I would say that proof is in the portfolio that we're building. (laughs)

Harry Stebbings 34:46 (laughs) Do you do outcome scenario planning? Because if I were to, like, say we were in the same team, I would say, "Well, actually, if you actually think about how big your true winnings can be, if you have a, you know, $5 billion company and you have 10% at exit, which, you know, you could have with dilution on a 15, 16% initial holding, well, there's your fund return and so actually, potentially the 20% is too aggressive." Like, my question is, do you do outcome scenario planning and how do you think about it?

Ophelia Brown 35:12 We do and I would challenge that if you started with 15%, by the time of exit, you're left with 10%.

Harry Stebbings 35:20 (laughs) Why?

Ophelia Brown 35:22 Because I think of from A, how many more rounds, the option pools. I mean, to only suffer 5% dilution from the series A to exit would be pretty impressive.

Harry Stebbings 35:34 How do you think about European ventures today as a product? Are you like, "Yeah, actually I think it's pretty adequately served"? Are you like, "Actually, there's quite a lot of mediocre players"?

Ophelia Brown 35:45 As in are there too many players in the market?

Harry Stebbings 35:48 Are there too many players, one.

Ophelia Brown 35:50 I think venture is a very transparently competitive sport where the founders ultimately choose, uh, who deserves to be in the ring. Which is quite an exciting industry to be in. Like, you constantly have to earn your place and I think what's exciting about Europe especially is, you know, 10 years ago, European founders felt that they had to go to the Valley to raise capital because there wasn't sufficient capital-

Harry Stebbings 36:22 In New York.

Ophelia Brown 36:23 ... now a founder does not have to leave. Like, everyone's here for them to choose. And the nature of the conversations and the w- way that they've risen to that and wisened up, it's actually incredible to see. Like, I think, um, founders are getting better support, better information because they have suddenly realized that they are in control of who they get to choose to be on their cap table.

Harry Stebbings 36:47 I credit podcasts like this, to be honest. But, uh, I agree with the first one entirely. No, I- I- I agree, I agree but I actually just look at over the last three months, I've seen three deals now where US VC's multi-stage have come in and won against seed VC's in Europe. And multi-stage VC's competing at seed, and I haven't seen that before. Three in three months where they're, like, supremely hot deals and they've chosen US multi-stage over European.

Ophelia Brown 37:20 So I find this really interesting, is ... And I think, like, European VC has an image problem. You can help with this. (laughs)

Harry Stebbings 37:27 (laughs)

Ophelia Brown 37:27 So if we look back at the history of European unicorns that have been built, uh, and look at who supported them at seed and series A, it wasn't US multi-stage firms. So there is something to be said for the European firms at the early stage who have the understanding, the network, et cetera, who support these companies. But there's obviously a lot of prestige with US venture and these brand names. And I think for some founders, that's really important. But I think that if European ventures did a (laughs) better job from a PR perspective (laughs) of how they've helped build these companies at the early stage, founders wouldn't have this kind of ... They feel like it's a lesser depict from a European VC. But it's the ones on the ground who understand who are going to be able to help you.

Harry Stebbings 38:14 It's interesting you say about me, by having a role in that, European VC's suck at telling stories. I know often people are like, "Oh, why, why didn't you have more European VC's?" Honestly, they, they really do not articulate stories well and they're not inspiring, exciting. They don't resonate in a way that US VC's absolutely do. Like, it's, it's really interesting. US VC's sell their product better.

Ophelia Brown 38:35 I mean US, Americans are very good at selling. (laughs)

Harry Stebbings 38:39 (laughs) Which we love.

Ophelia Brown 38:40 (laughs)

Harry Stebbings 38:40 To our US audience, we're very, very grateful for your sales ability. (laughs) Um, when do you think, like, actually as an ambassador, I should improve?

Ophelia Brown 38:49 You should improve?

Harry Stebbings 38:50 No, you.

Ophelia Brown 38:51 Oh. (laughs)

Harry Stebbings 38:52 (laughs) This is an assessment on me. (laughs)

Ophelia Brown 38:56 (laughs) So next. (laughs)

Harry Stebbings 38:56 Thanks for that. (laughs)

Ophelia Brown 38:57 Okay. Here's some feedback.

Harry Stebbings 38:58 Yeah. It was B minus. Ah. Do, do you go, "Ah, you know what? I should get better there."

Ophelia Brown 39:04 I think over the years, I've become to realize there are so many different ways of looking at something and you really have to focus on broadening the mind. I think, like, narrow does not necessarily lead you to good places. It ... You've got to have the courage of your conviction, you've got to be able to have judgment, et cetera, and you should be able to pay attention to what's important or not. But it really does take kind of thinking, "Oh, I wouldn't have looked at it that way," or not assuming that someone just thinks like you. Um, I spend a lot of time focusing on that. And that's really why I like a diverse partnership and having, I- ... You know, if you look at me, Imran and Alex, we're very different backgrounds, very different views on things, but we don't necessarily see to eye-to-eye, and that's a good thing.

Harry Stebbings 39:52 You said you don't have ICs but you mentioned three partners there. How do you actually make investment decisions?

Ophelia Brown 39:57 So a lot of discussion and debate. It's very iterative. Like, we won't just have a company come meet us, present for 45 minutes. We spend a lot of time kind of, uh, thinking about, you know, challenging each other on the investment visas, the market size, where the, the fact team strengths are, where they aren't, and the- the more you go along, you come to realize, like, where you stand on different parts of the investment. And then once we decide to invest, even if we've disagreed over points, because we all support together, we're all committed to this company being successful.

Harry Stebbings 40:29 Do you agree with the disagree and commit, as like a-

Ophelia Brown 40:32 Yes.

Harry Stebbings 40:32 ... principle? You do?

Ophelia Brown 40:33 Absolutely. This comes back to you've got to believe there's some- something that someone else doesn't at the early stage.

Harry Stebbings 40:39 Yeah.

Ophelia Brown 40:39 And so you have to give partners a place where they feel that they can articulate, "No, I really beli- I see that you don't see that, but I very strongly do." And then, you know, if we- company's gonna be one of our 15, 20 companies, we should be committed.

Harry Stebbings 40:55 Can I ask you a weird one? But I had David Tisch on from Box the other day and he presented this framework for, like, advising founders on, on rounds and he said, "You have three variables to really think through. One is price, two is the size of round, and three is the brand of the investor." And which two you have out of the three is my question when I ask you that. Price, size of round, brand of the investor. Which are the priorities and which do you let go?

Ophelia Brown 41:24 As in when founders are choosing to work with Blossom?

Harry Stebbings 41:26 As in what would you advise them?

Ophelia Brown 41:31 Price and round.

Harry Stebbings 41:33 Really?

Ophelia Brown 41:34 So I think that it comes back to the, you know, how many, uh, how many venture firms are there in the marketplace and what does brand really mean. And actually this comes from the hard way when you're a new fund. Like, when Blossom started, we didn't have the brand of a 20VC. I mean, we were no brand firm.

Harry Stebbings 41:51 (laughs)

Ophelia Brown 41:52 And we really had to earn our right at the table and some of the hardest fought deals were, "Do I go with a brand firm or do I go with this unproven startup, Blossom?" And we had to show, like, "This is what you get if you work with us." And I think the value that you get is more important than a brand. Like, I think there used to be a thinking that brand will help me hire, brand will help build persis- publicity, but so many deals are done, like, when a engineer is choosing to work for company X or company Y, they're going for the mission and the product and the team.... great if you, you know, vi- raised money from a brand name investor, but brand name investor has also done 40 other deals that year.

Harry Stebbings 42:35 I agree. Um, I think it can help, a- have multiple, well, I think it can help if it's Sequoia, um, just e- to people who resonate with, with the brand. Um, uh, and two, I think, uh, but the flip side of that is actually if people are like, "Oh, well, a Sequoia did it," or "X funded that," they want to pick on Sequoia and use that as validation, maybe they're not the right choice to join your startup. Like, if they're joining because of the investor, well, that's a large part of their consideration. I- I- I would think hard about that.

Ophelia Brown 43:04 Yeah, I honestly would choose anyone who's joining me for my mission, because of my work culture, because of a, a number of other reasons before they're joining me, before my investor.

Harry Stebbings 43:16 What would you like to see Europe do differently? Like I said, I think we can tell stories better, I think we can actually present better as a VC class. What do you think Europe can do better on?

Ophelia Brown 43:26 I would like to see those, like, as companies scale and we have fewer companies going, you know, from the Series C beyond to exit, I feel like there should be more shared learnings amongst that community. The, you know, founders are very scared of reaching out to other founders because, you know, the founders are busy or whatever. But I feel like in the, uh, in the US there's much more, like, collaboration between helping people. I mean, you're part of a lot of these communities, et cetera, networks.

Harry Stebbings 43:55 Mm.

Ophelia Brown 43:55 Europe's kind of growing in those, but I think we could help push that forward.

Harry Stebbings 44:00 Is there anything we could do to do that? Is that like operator networks? Is that like angel networks? Like...

Ophelia Brown 44:04 I think it, the, the distinction of investing versus helping build is very different. So I think angels have one place, but I think operator networks where it's not just about f- supporting the founders, it's about, you know, CMOs, CRO- CROs, et cetera, really enabling them to be successful.

Harry Stebbings 44:21 You know what I think Europe's really just poor and is not okay, is bluntly in LP provisions. And what I mean by that is, well, I, I think it's poor in a couple ways, but like, like fundamentally, you know, some of the largest pension funds in Europe d- don't invest in venture. I mean, that's, like, unthinkable in the US. You know, I, I think when you look at a lot of educational facilities in Europe, we don't have any allocation to venture. I know the budgets are much smaller than the US, I'm not asking them to invest the same amount, but they should be investing just for their sake. Uh, wh- when it comes to fundraising and LPs, how have your experiences been? You were a solo GP res- uh, I hate this question, fuck, I can't believe I'm asking it, but you're a female solo GP, like, how was it for you?

Ophelia Brown 45:04 So I'm very-

Harry Stebbings 45:06 That was a terrible question, wasn't it? (laughs) Oh, no.

Ophelia Brown 45:10 (laughs)

Harry Stebbings 45:10 I'm gonna get killed for that. Anyway, you rock and roll with it.

Ophelia Brown 45:14 Um, I'm very glad that I was quite naive coming into the fundraiser process. I mean, I'd been at Index, I'd been at LocalGlobe.

Harry Stebbings 45:25 But you don't get to see a lot in, in like Index, I presume. You don't get to-

Ophelia Brown 45:28 I mean, funds just got raised.

Harry Stebbings 45:29 Yeah. (laughs)

Ophelia Brown 45:30 (laughs) So...

Harry Stebbings 45:31 Click to pay, PayPal. (laughs)

Ophelia Brown 45:33 I thought that's how it would go, you know? It was, I mean, fundraising as a solo GP for Europe was brutal. I mean, (laughs) there's no two ways about it.

Harry Stebbings 45:45 I remember when we were raising, uh, a fund for, my old fund and we were raising at the same time. And everyone was like, "Oh, what do you think about them?" And you were like, "Well, they're not investing in us."

Ophelia Brown 45:54 (laughs)

Harry Stebbings 45:54 Please. Please. (laughs) I'm sure you had the same. God, it was brutal. No, it was brutal. But why was it brutal? Just like so many meetings, like people saying no.

Ophelia Brown 46:06 It was, I mean, there were reasons that people would say no that I could understand, like solo GP. When people would tell you, "I just don't believe in Europe," I mean, I found that no hard, hard to... (laughs) Like, wow, (laughs) this is, this is the career that I've built and this is like the market that I really believe in. Um, there's not much I can do with that feedback.

Harry Stebbings 46:28 But I'm also like, to that right now, and I don't mean this in irony, why take the meeting? That's like me meeting a SaaS company and then saying, "I don't believe in SaaS, so I should never have taken a meeting if I didn't believe in SaaS."

Ophelia Brown 46:37 I mean, that's one thing that I learned about the LP market is that everyone will take a meeting. So-

Harry Stebbings 46:42 (laughs)

Ophelia Brown 46:42 ... I remember, uh, the, (laughs) when people would ask for the data room at the end of the meeting. And so if you're a VC and you ask for a data room, it means that you really want to consider investing. And then I realized that we were shared this data room and no one was doing anything with it. (laughs)

Harry Stebbings 47:00 (laughs)

Ophelia Brown 47:00 And so all this money that I thought I was so close to raising, like- (laughs)

Harry Stebbings 47:04 Wh- why were they asking for the data room then?

Ophelia Brown 47:06 Because there was this data inside it, it was interesting, you know, there were stats from the European market. (laughs)

Harry Stebbings 47:09 But they weren't going in it.

Ophelia Brown 47:11 I mean, there was this, why not data collect?

Harry Stebbings 47:14 Oh, I love it when we do like the, the theses on like the European market. If you were like selling the market a lesson on Avis-

Ophelia Brown 47:19 Yeah, that's never gonna happen. (laughs)

Harry Stebbings 47:21 ... then it's done. It, it's just done. I also actually say like, actually don't ever sit in the data room unless you're raising like big, large funds like, you know, your multi-billion dollar funds or your, you know, multi-stage funds. But generally speaking, 'cause actually you have this paradox of choice where suddenly they're given 12 things in there and they're like, "Uh, I'll get to it later." And actually you say, "What can I help you with specifically? You want my track? Great, I'll send you my track. You want actually, uh, you know, uh, the operator network that we're building up, that, great, I'll send you that." Like give them what they want-

Ophelia Brown 47:48 Yeah.

Harry Stebbings 47:48 ... not the link in some horrible doc send or whatever. Do you know what I mean?

Ophelia Brown 47:53 I do. We were using Dropbox, which was also probably not the- (laughs)

Harry Stebbings 47:56 Oh, we paid extraordinary amounts of money for this thing. What was the most memorable LP meeting you have?

Ophelia Brown 48:02 I mean, there were a lot of bad meetings, but the French, what's the French, uh, equivalent of EIF, the-

Harry Stebbings 48:08 BPI.

Ophelia Brown 48:09 BPI. They asked me where my older male partner was.

Harry Stebbings 48:13 Oh. Oh. (laughs) What do you say? Like-

Ophelia Brown 48:17 (laughs)

Harry Stebbings 48:17 ... "He's sick?" (laughs)

Ophelia Brown 48:19 No.

Harry Stebbings 48:19 "Can you give me 10 million quid now?" (laughs) Sorry. No, you said like no.

Ophelia Brown 48:26 Yeah.

Harry Stebbings 48:26 Yeah.

Ophelia Brown 48:26 I was like, "I don't have one."

Harry Stebbings 48:28 That, that's terrible. That's truly terrible. What would you change with LP markets?

Ophelia Brown 48:34 It wasn't something I'd change but when I came into market with the first funder I was like, "We're closing in..." You know, thanks Mickey for the advice. "We're closing (laughs) every month."

Harry Stebbings 48:44 (laughs)

Ophelia Brown 48:45 One and done, et cetera, and then I realized that actually this is a really long term relationship.

Harry Stebbings 48:52 And you didn't have those existing relationships correct?

Ophelia Brown 48:55 I had a couple of existing relationships.

Harry Stebbings 48:56 But it wasn't like you were going to 15 that you'd known for years.

Ophelia Brown 48:59 Exactly. And then I was like, okay, I actually really understand why this takes time, like, I understand why you'd want to see our performance and not execution over some months.

Harry Stebbings 49:08 Yeah. And so you did... Sorry, I am digging in 'cause I think, you know, we have so many managers that listen who are going through this, and it's like, you did a close and then you invested or you just focused on fundraising?

Ophelia Brown 49:20 So we did a c- first close within I think it was six months, uh, from beginning to the first close.

Harry Stebbings 49:27 What sort of percent is that for you, would you recommend for people? It doesn't have to be yours personally but like people-

Ophelia Brown 49:31 So the advice that I was given was get to 50%.

Harry Stebbings 49:34 Yeah.

Ophelia Brown 49:35 I don't know whether that's holds, but that's the advice that I was given.

Harry Stebbings 49:38 Mm-hmm.

Ophelia Brown 49:39 Um, so that would be mine.

Harry Stebbings 49:40 Yeah, I agree if you get to less it's not sure enough.

Ophelia Brown 49:43 Yeah.

Harry Stebbings 49:44 Yeah.

Ophelia Brown 49:44 Um, I mean, we would have closed on anything. (laughs)

Harry Stebbings 49:51 (laughs)

Ophelia Brown 49:51 We just wanted to be in business, but we got halfway, and then there's a provision in the LPA that says you have 12 months.

Harry Stebbings 49:57 Mm-hmm.

Ophelia Brown 49:58 And so after our first close people took a lot of meetings with us, I think to figure out, you know, how did that manager get to a first close, what's going on here? And I realized after those meetings actually they were never going to invest, they were just again kind of curious, and because we had the 12 months by the provision in the LPA to do the final close, people wanted to wait to see what investments we did.

Harry Stebbings 50:21 I think you did the right thing then. It was a big lesson for me actually watching you externally was you, you did the closes and then you invested, you built a book of business, you showed the type of companies you like to invest in, also how you invested, how you thought the work that you did. Whereas I think, you know, a lot of people or maybe just me, um, didn't in my first funds and just like focused on fundraising, which makes sense from a productivity perspective but then you're not building any form of book to show and it makes it harder almost to sell, if that makes sense.

Ophelia Brown 50:50 Yeah.

Harry Stebbings 50:51 What lessons do you have on building great partnerships?

Ophelia Brown 50:55 It's the toughest thing.

Harry Stebbings 50:56 Yeah.

Ophelia Brown 50:56 I think finding talent, the right talent, um, building a culture, I mean, that, that is the hardest thing and not necessarily something that comes naturally to an investor like a founder. I think some people will really thrive in one workplace culture and not in another and so trying to figure out dynamics between people and how people work in a certain environment, I think that's what you go through at the beginning of a company's journey is that some people are really good for that stage, don't enjoy that stage, some people think that they will really enjoy a concentrated strategy but actually won't, et cetera. So there's, there's a lot of learnings.

Harry Stebbings 51:37 Can I ask you a weird one? I think the reason we get on is 'cause we're both quite intense and on, uh, uh, all the time, um, which sounds like a, you know, humble brag, uh, I'd think, you know, when I'm like literally messaging on weekends and getting pissed off with people why things aren't being done and it's like, ah, it's the weekend. Like, uh, I, uh, do you expect people to be like you?

Ophelia Brown 52:00 That goes to my earlier point, you've got to understand that people aren't necessarily like you. I also think that try... I mean, there are certain things that you can, you can remind yourself that it is a Sunday morning perhaps that message doesn't need to be sent at that hour. But trying to tell yourself that you're not intense, you're not going to act in an intense way or do certain things because that's who you are, I don't think you can fundamentally change yourself, you can improve yourself and definitely respect the other person and be conscious of, you know, how they are not like you, but if you're an intense person that's kind of got you where you are and there are parts of it you should really own.

Harry Stebbings 52:42 Speaking of which, final one, um, you know, I, I obviously think the world of you, um... (laughs)

Ophelia Brown 52:50 (laughs) Caveat. (laughs)

Harry Stebbings 52:51 Uh... (laughs)

Ophelia Brown 52:53 Some people ............................ (laughs)

Harry Stebbings 52:54 (laughs) I think we had it as an oreo the other day which is like, no that's hard, soft, hard, maybe this is a shit sandwich. I don't know what it is, whatever, it's some form of metaphor of like food and shit. (laughs)

Ophelia Brown 53:05 It is... It is the crap. (laughs)

Harry Stebbings 53:07 Yeah. I think you're great-

Ophelia Brown 53:08 (laughs)

Harry Stebbings 53:08 ... um, but some

Harry Stebbings 53:10 don't. Um, w- how... Does that upset you and how do you respond to that where people think you're abrasive or bluntly challenging?

Ophelia Brown 53:20 I definitely care. I think there's ways that I come across that I don't think people necessarily understand. Like, the abrasive thing, I p- think people don't know that I'm actually much shier than you would think. Like, uh, when we were at university or when we were doing our MBA, like there would be always like, you know, a group of people getting drinks in the bar and being really sociable and I'd be like, "I'm going to go and do my work," and I'm actually c- more comfortable in like a, you know, one to one setting than a group setting but people think that means I'm abrasive. Um, I really do care what other people think, um, but also that doesn't prevent me from trying to be honest and be truthful and direct. So if I need to say something because I think it's important that you hear it, like, as, so long as that message is delivered in the right way, I feel that that's, that's how I should be. Um, but I've never tried to be, you know, rude or et cetera. The whole she's aggressive, uh, you know, she's sharp elbowed-

Harry Stebbings 54:24 Do you think they'd say that if you were a man?

Ophelia Brown 54:27 I don't think people would say that if I was a man. I think that's a comment that people level at a woman-

Harry Stebbings 54:31 Yeah.

Ophelia Brown 54:32 ... all the time, and you know, one of our favorite LPs when they were taking the found- uh, the references and they said, "You know, people say you're aggressive," but w-I like it because I'm teaching my daughter to be precisely like that.

Harry Stebbings 54:44 (laughs)

Ophelia Brown 54:44 V- venture is a competitive sport. If you want to lead deals and you want to be a great partner to your founders, then you are going to inevitably be a bit sharp elbowed.

Harry Stebbings 54:54 I, I, I totally agree. Um, I, I, what matters is what the founders that work with you say, which is why I think it's interesting to compare what your co-investors, well not co-investors, but people in the ecosystem say and what your founders say. Um, s- sorry. I had, I ha- I had to ask it.

Ophelia Brown 55:08 Thank you.

Harry Stebbings 55:08 Uh, now that that's done, we, we, we can do a quick fire round. It's my favorite round. Uh, okay.

Harry Stebbings 55:13 What would you most like to change about the world of venture?

Ophelia Brown 55:17 I don't like the hype. I would love to go back to the art of deal making.

Harry Stebbings 55:22 Do you think that's possible? Like, is this not just a, a product of so much cash in the ecosystem?

Ophelia Brown 55:27 I think it is a product, so I think it depends how the cycle ends.

Harry Stebbings 55:32 What's the hardest element of the entire Blossom journey? Do you remember a moment when it was like, "Oh, this is hard."

Ophelia Brown 55:40 The early days. Again, it goes back, they were brutal. I mean, sometimes the nos came out of places that you didn't expect to.

Harry Stebbings 55:47 What did you tell yourself when it's like that, that one, the ones that hurt are when it's like, it's closed and it's a no, and you get that and you're like, "Oh, I thought they were there."

Ophelia Brown 55:56 This is what I would say to any founder or any person building a fund, 99% of it is sheer determination and perseverance. Like, there was just no option not to get to a first close.

Harry Stebbings 56:13 I, I totally agree with you. I think just human nature is you give up, um (laughs) , which is something we-

Ophelia Brown 56:18 But I think also a lot about, that's also what I learned, um, and this comes from my husband who actually raised a fund before me and he, I mean, I owe a lot of my success, uh, to him. Um, he was like, "It takes eight meetings to close an LP." That was his rough rule of thumb. Uh, and I was like, "Why so many meetings?" And he was like, "You know, they just don't expect you to come back."

Harry Stebbings 56:43 (laughs)

Ophelia Brown 56:43 (laughs)

Harry Stebbings 56:44 You're like, "Uh, thing is, I'd do it like eight days in a row." Like, you know, "I'm here." (laughs)

Ophelia Brown 56:49 "Hey, I'm still here." (laughs)

Harry Stebbings 56:50 "Yeah, still here." Um, I actually heard a rumor once, this is off, off schedule, but I just heard a rumor that you like, slept in like, an office waiting room to get a deal? Is that true?

Ophelia Brown 57:05 Let rumors be rumors. Let the myth perpetuate.

Harry Stebbings 57:09 (laughs)

Ophelia Brown 57:09 Anything to get a deal done.

Harry Stebbings 57:10 I was like, "That's kind of impressively weird," but I wasn't sure where I landed. What's the trend that most investors are ignoring right now?

Ophelia Brown 57:19 Crypto.

Harry Stebbings 57:21 I, I, I genuinely think like, growth crypto is like, potentially, no I'm being serious, one of the most interesting. See, you, you've got 1000 companies funded, I'm just making up numbers, over the last two years and actually, listen, 15 to 20 will actually be incredibly strong teams and companies. Who's doing crypto growth right now?

Ophelia Brown 57:38 I know. Who's even doing early stage crypto anymore?

Harry Stebbings 57:41 Me. I, I'm still doing it. Um, Guillaume, uh, said this. "How did you travel during COVID to get a deal done?"

Ophelia Brown 57:49 We go full circle, we'll do anything to win an investment.

Harry Stebbings 57:53 Where did you go?

Ophelia Brown 57:54 Went to Paris.

Harry Stebbings 57:55 Oh, wow. When you weren't allowed to?

Ophelia Brown 57:57 Well, I was allowed. I have, uh, a lot of thanks to my partner Imran who went into the details of how you could get into another country, and if you were traveling from your primary residence to your other residence, so I, if my Estonian husband could go from London to Estonia via Paris with me-

Harry Stebbings 58:18 Huh.

Ophelia Brown 58:18 ... then you could get to Paris. (laughs)

Harry Stebbings 58:21 (laughs) Have you ever seen the, the Netflix documentary with Carlos Ghosn? You know, the like, Toyota executive who went in the like, violin case or the cello case, cello case, not a violin, he's not that small.

Ophelia Brown 58:30 (laughs)

Harry Stebbings 58:30 But I was just envisioning you then getting in a cello case to go to Paris for a deal.

Ophelia Brown 58:33 (laughs)

Harry Stebbings 58:34 Uh, much cooler you could've, uh, styled that one out. Uh, cold email to Mike Moritz and Alfred Lin, um, Alfred said you were incredible with your cold email because you emailed both and they both independently were like, "Wow." What did you say?

Ophelia Brown 58:50 I would never reveal secrets.

Harry Stebbings 58:52 (laughs) But like, well, okay, f- forgetting like that specific one, for founders cold emailing you, what would you say advice wise?

Ophelia Brown 59:01 If they were cold emailing me?

Harry Stebbings 59:02 Yeah.

Ophelia Brown 59:04 Just be genuine. The number of cold emails that you get where you're like, "There's no thought behind this." You know, that it's like a copy, paste, or edit the name, or it's very generic. You're trying to in one email grab someone's attention. 'Cause you know how they say like, first impressions matter when you meet someone in person?

Harry Stebbings 59:24 Yeah.

Ophelia Brown 59:25 Think about that from an email perspective.

Harry Stebbings 59:27 Yeah. I, I, I totally agree. And keep it short.

Ophelia Brown 59:31 Yeah.

Harry Stebbings 59:32 Like, if they use something to get somewhere, it's like, oh my God, fucking four scrolls down.

Ophelia Brown 59:36 (laughs)

Harry Stebbings 59:37 Um, yeah. If you could have one word on your tombstone, what would you have?

Ophelia Brown 59:41 Blossomed.

Harry Stebbings 59:43 What did you do in the last 24 months that you wish you hadn't done?

Ophelia Brown 59:48 Nothing. It's all learnings.

Harry Stebbings 59:52 God.

Ophelia Brown 59:53 (laughs)

Harry Stebbings 59:53 Um, fine. Um, arm wrestling a founder to ensure they took your investment.

Ophelia Brown 59:59 Only when you can't win by any other way. (laughs)

Harry Stebbings 1:00:02 Did you actually do this?

Ophelia Brown 1:00:02 Yes.

Harry Stebbings 1:00:03 Where was it? Like, like middle of the office? Like...

Ophelia Brown 1:00:07 No. It was in Dublin. It was for Tines.

Harry Stebbings 1:00:09 Oh wow. And you, did you win?

Ophelia Brown 1:00:12 I wish I could remember. (laughs)

Harry Stebbings 1:00:14 But you got the deal?

Ophelia Brown 1:00:15 Yes.

Harry Stebbings 1:00:15 Okay, you got the deal. Uh, penultimate one. You mentioned your husband. I, I clearly have not mastered this one. Um, how do you like, be fucking stellar at what you do and also have a very happy marriage, and also like, a, you know, recent mother? How, how does, how does that work? (laughs)

Ophelia Brown 1:00:35 It's being incredibly conscientious about how you spend time, what matters, what's important and-

Harry Stebbings 1:00:47 What have you cut out that you used to do that you no longer do, if it's like conscientious about time?

Ophelia Brown 1:00:57 It's, it's funny the mov- so before I became a mother everyone was like, "Oh, you become so much more efficient when you become a parent." And I was like, "I'm already pretty efficient." (laughs)

Harry Stebbings 1:01:12 (laughs) Not worried about that one.

Ophelia Brown 1:01:13 Not sure I can do it more that way. But what it really opened up is everything is just a choice, whether I spend time on X, I spend time on Y. So you know, if I want to make X number of investments this year, I better be very deliberate in which teams I spend time with. Um, you know, where I say yes, where I say no, where I can add value, where I can't. And that has been incredibly conscientious. Um, I'm also very fortunate that my husband is the one person will just call bullshit. (laughs)

Harry Stebbings 1:01:47 (laughs) You need that. I haven't got that in a mother. Um, who expects and rather actually just speak bullshit and not have that. Um, but I, I wanna finish on the next five years for you. So this is 2028. What is Blossom then?

Ophelia Brown 1:02:03 The best performing fund, at least in Europe, if not the world.

Harry Stebbings 1:02:10 I've had so much fun doing this. (laughs) Uh, thank you so much for putting up with my completely wayward questions from, you know, mortality to portfolio construction.

Ophelia Brown 1:02:19 Thank you for not sticking to script. (laughs) That's what-

Harry Stebbings 1:02:22 (laughs) It's 'cause I can't read it while like, engaging. It's useless having it here. Uh, you're amazing. Thank you so much.

Ophelia Brown 1:02:28 Thank you.