ACP has been created as a specialist early stage FinTech investor to fill a gap in the market. Here is why.
Today, technology startups are easier to create and cheaper to set up.
What all of the above means is that for the founders of an early stage firm the dollars invested by a venture capital firm are worth less than they used to be.
As a result, the venture capital (VC) industry is, we believe, in transition, moving to a ‘barbell’ industry structure:
So, VCs are being squeezed at both ends. In the environment described above, what might a successful VC look like?
We believe the market is bifurcating.
Strong early stage businesses look not just for cash but for the greatest degree of support (advice, expertise, networks, etc). Successful ‘Angel Investors’ or those VCs genuinely focused on early stage firms are likely to provide this. At some later point, the founders look for validation i.e. a marquee investor. Here the large, established VCs have a competitive edge. Of course, they offer more than money—expertise, huge networks, advice on exits etc—but their principal attraction to an entrepreneur at the time of investment is the validation from the brand.
Hence our belief that the VC market is bifurcating with big name VCs generally investing later and specialist VCs and Angels discovering strong early stage firms. As a result, we believe Funds stuck in the middle risk losing out on quality deal flow.
ACP is ideally-placed as a specialist early stage investor.
Assembly Capital Partners Limited is an Appointed Representative of Sapia Partners LLP
which is authorized and regulated by the Financial Conduct Authority (Ref: 550103).
Assembly Capital Partners Ltd. © 2018
All rights reserved.