Alexandra Vidyuk | Beyond Earth

0:00Alexandra Vidyuk: Pitch, pitch, pass, iterate it fast. Story beats data when the storyline's vast. Visions the ignition, but the numbers steer the ride. Conviction and precision watch investors collide. Hey everybody, welcome to another episode of Fundraising, a podcast where we interview early stage investors to help you as a fundraising founder navigate this process that right before this, Alexandra, we were saying that is actually no fun at all, even though the name itself might imply that. And today I have a very special guest, Alexandra Vidyuk, CEO and founding partner of Beyond Earth Ventures, fellow deep tech investor, which I always think is a very fun process to navigate in the fundraising process.

0:43Alexandra, thank you for being on today. Could you please do a quick introduction on Beyond Earth Ventures, what you're investing in, the stages and then check sizes that you're investing in? Thank you so much for having me. I love this podcast and it's so good to be here. So Beyond Earth Ventures is a US-based deep tech VC. We invest in early stage companies in sectors such as energy, robotics, space, material science, communications, and anything which sounds cool to us, right? So we typically do from press C to series B. So we are flexible. I don't want to be very strict in specific stages because, you know, in deep tech stages sometimes not exactly the same as in software, right?

1:25So we try not to be very strict about that, but just look at the stage of the company. Our check size is typically between half a million up to two million. That's great. Yeah, you're exactly right. I feel like these days, deep tech, I've seen pre-seed companies and seed companies that might as well be Series A companies from a price standpoint or what they're raising. So it's just the barrier or the gradient is so big. Exactly. So the way we do this podcast is we kind of go a little bit into yourself. A lot of these intro questions are questions that founders had nominated and upvoted. And the goal is to give a little peek behind the curtain on yourself, but then also maybe on the day in the life of a VC as well, because it feels like this very mysterious job for a lot of founders.

2:07And when they better understand the process, I think it helps them in the fundraising process itself. So maybe we start a little bit on your background. Why did you choose to become a VC? What were you doing maybe before you? so i studied physics as a kid and i have a degree in physics from from university so i always wanted to become a scientist uh somehow ended up in banking and i spent 10 years in international banking in london hong kong and then i built my own company it was a payments technology startup so i built something about people normally say it's like from zero to one right the first fundraising their first round first product revenue and i absolutely loved it and i was like okay i love to be in this entrepreneurship world but i i'm done with finance so i don't want the banking anymore so i was like okay great so how can i combine science plus finance plus entrepreneurship and i think deep tech we see was an obvious choice for me um and here i am uh investing in deep tech founders.

3:11Typically, sometimes I describe my job as making scientist billionaires and looking for NVIDIA next SpaceX, right? So that's kind of, in a nutshell, that's exactly what I do. I love that mission. Do you feel like the physics background maybe gives you not an edge, but a better way of understanding some of the complex pieces that these folks are building in today? It does help a lot. Of course, we have an expert network as well, which we call like, you know, when we have a specific question, but I think it helps to, I mean, first of all, appreciate what people do more than, I guess, people with like, you know, especially I love to go to the labs.

3:49I love to, you know, look at microscopes and see what people do. Like, and it's kind of amazing. I enjoy it personally, but I think also it's helped sometimes with quite a basic checks, I think as well, like in terms of science, like asking the right questions And I mean, a lot of founders appreciate that, right? So instead of people asking like, oh, what's the variation of your lead term sheet, you ask, oh, what do you think about this plasma parameter, right? It's kind of a bit of a different approach. So I guess, yeah. Founder empathy is one of the most powerful things a VC can have. And you kind of have it on two levels, not only from being a founder yourself and gone through that gauntlet, but also as a scientist.

4:29A lot of these founders are indeed scientists and engineers so that you can speak kind of both of those languages is great. Another question, this is a common one that we hear founders asking, what is your favorite part about the job? And then what is your least favorite part about the job and being a VC? My favorite part about the job is to speak to founders, right? That's the kind of people who have, I mean, like one of the smartest people in the world who have an ambition, who have passion, who have energy. They want to change the world. They want to build something. no one else built before.

5:00This is just so contingent. This is so inspiring. And I get a lot of energy. I mean, unfortunately, this is not the kind of everything that I do, right? I also have to go speak to my own LPs, negotiate with, you know, like with other VCs and go to all of these conferences just to meet new people, which sometimes, you know, new startups as well. I don't like admin stuff of my job, right? So sometimes reporting and taxes and kind of all of that. Luckily, we do have tools now to manage that, and AI helps a lot. So I think our lives are getting better in that regard. I would agree. But it is still every now and then we do a lot of work that we wish we would rather not do.

5:39In a similar vein to that, is there anything that you wish maybe founders better understood about the day in the life of a VC? As I mentioned earlier, it feels like this mysterious and oftentimes overly glamorous job. It's not always. Is there anything that maybe founders, if they ever understood about being a VC, could better understand or appreciate the fundraising process too? Well, I think, so we get a lot of emails, a lot of cold outreach, LinkedIn on email. So I think on average, I probably get around 200 deals a month. And we try to invest one deal a month, right? So it's a lot of... Less than 1%, yeah.

6:19Yeah, it's a lot of incoming requests. It's impossible for me to reply to everyone, even with a, yeah, even with like, you know, Gemini auto-auto proposal. So that's why if you don't reply, that's because there is a lot of something going on, right? So I probably say, probably I spent half of my day talking to founders, a lot of pitches, I would say maybe like three, four different pitches sometimes. It's kind of, you know, going through due diligence, maybe it's different team members, maybe advisors and so on. Sometimes it's a first time meeting, right, with the founder. spend a lot of time in data rooms.

6:52So going through patents, articles, financial models, kind of checking everything, talking to experts, talking to their clients, talking to potentially competitors. So, I mean, probably a good VC will speak to all competitors in that sector before investing in a category winner. We also fundraising by ourselves, right? So I'm fundraising always for my current fund, my next fund. Portfolio companies are also raising next round. So I want to bring them good investors. I want to bring other VCs to do. So it's very important to kind of have the good relationship with other VCs in our specific sectors.

7:32When they have a deal, they call me. When I have a good deal, I call them. That's kind of, I mean, a lot of people think that we like always speaking at a conference with a mic on the stage. We do that because we want to, of course, everyone takes a picture when we go to a conference. We do that because you want to meet more good projects, more good startups, other investors and co-investors. It's a networking game, obviously, like many other things. But you're always selling and, again, you're always raising even as a VC. What are some of the areas or industries or sectors problems that you are personally excited about right now?

8:11You named some of the sectors that you're investing in. Any specific things right now that are really exciting to you? I love energy. I think energy is a limitation for development of our civilization, right? The more energy they have, the more entropy we have. You know, I mean, it's easy to say that it's AI upstream. Of course, data centers need energy. That's why there's so much demand. But generally, I think that the energy, there's so many innovation happening. So we have fusion energy. We have SMRs. We have innovation in solar panels, in storage, in grid management, right? So in every sector you look and you think, oh, there's probably a couple of breakthrough.

8:50No, it's like hundreds of them, right? So it's almost any good university have like several labs and several patents coming out. It's amazing to see that. We have invested in a number of companies in the energy sector. One of the most exciting ones recently was nuclear fusion. We spent 18 months looking at a sector, trying to define and understand, is that still 20 years away from today, or is it 20 months away? And we decided it's actually 20 months away. So we have, you know, after speaking to probably every single expert in the world in terms of fusion energy, we've made an investment, but it's not announced yet.

9:29Hopefully we'll be announced. But it's an amazing company. And we think if we have fusion energy working, that will be like an LLM moment for our civilization. Yeah. Yeah. And the thing with energy that's always so fascinating is that it's such a global problem. And I know one of the things you mentioned earlier is you have such a global thesis and energy being solved in one part of the world needs to be solved everywhere. And that distribution and scale is a problem in itself, too. So it's definitely one of those industries that has a lot of runway to keep going. The last question that we have here is a little bit of an opportunity for you to shine.

10:07why should founders pick you and or beyond earth to be on their cap table? I mean, there's always kind of every VC trying to pretend they are the best and probably will say like cliche things like, oh, we're like much more than capital. I mean, my story is very similar, right? So, I mean, one of our portfolio companies mentioned to us that we were the smallest check on the cap table and the biggest value. But that's exactly what we're trying to do. I mean, smallest check, it's kind of not a good thing. We're trying to improve that as well. So fundraising more and that kind of for the fund as well, it helps, right?

10:45But it's about, I mean, we all exited founders by ourselves. And we have three PhDs in the team. We have Nobel Prize laureate and our advisory board. I mean, that's nothing typical like we see, right? So we are very like, you know, hardcore deep tech. And we don't shy away from crazy ideas as well. We will at least try to speak to them, maybe give some guidance, maybe try to ask them to pivot or something or improve the materials so for other VCs they can kind of have a better storyline. It's about, you know, I think that the VCs are here to help people to talk to government, right? Lobby, find the right people, bring other VCs to the round, late stage VCs as well if possible, write recommendations about hiring, about some service providers.

11:32Our team is very international, so I'm calling today from Singapore. Even then, our VC is U.S.-based. I do spend half of my time in Singapore, half of my time traveling to the U.S. and Europe. It's also very important. It's a very difficult geopolitical situation, but you need to be very careful which countries and which partners you work with. But there's a lot of international collaboration between Singapore and the U.S., a lot of grant opportunities, a lot of R &D opportunities, local universities, which are like, no, top 10 in the world, right? So we are trying to facilitate that as much as possible.

12:04and of course there's a lot of capital. Singapore is one of the capitals of capital, we say. So that's kind of, we always try to see if we can help. But I think the best way is like, I think I was a founder by myself. The worst we see is the VC who is like calling you every three months and say, where is my quarterly report, right? And I try not to be like this. I try to be, if I need, if we did have cases when Friday night the founder calls me and say, I need to apply for a grant by Monday morning. I don't have a partner. Can you find me a partner? And we did, and they applied. And I was like, this exactly, I am a VC.

12:47I'm trying to be a VC, which I wanted like when I was a founder. So I think that's kind of the best experience to leave it first, and then you can become a VC. Yeah, incredible answer. I agree. Be the VC that you wish that you had when you were fundraising is a great way of doing it. But navigating global capital and opportunity is an incredible value add that is rare, I think, in this world, too. So that's a great answer. All right. The way we break up the fundraising process is in three parts. The first is all about getting in the room. A lot of folks that are listening to this are all over the world, and they might be in places that are not a San Francisco or a New York, and access to capital may not be as easy.

13:35A lot of them are reaching out colds or trying to get warm introductions. So the purpose of this segment is to hopefully give them some tips and tricks to navigate that a little bit better. We see a lot of founders when they first start this process, they make a list of VCs that they want to reach out to. Usually it's a lot less than they actually think. But sometimes they make mistakes on the type of VCs or funds that they're going after. What advice would you give? And there's a different school of thoughts, right? Some people say start with Tier 3 and then kind of you polish the pitch and you go to Tier 2.

14:08you polish and then when you're ready when your pitch in data room is absolutely 100 correct then you go to pitch to tier one some people say go opposite like do tier one vcs first and then you know when they reject you go to tier two you go to so you have to basically like navigate this process i i don't know what's a good answer i normally say that just try to think about sectors right so okay if you're like let's say space energy right so you can go startup you can go for space vcs you can go So for energy VCs, you just go like generalist, deep tech VCs. I normally try to say maybe you should also have a combination of like two or three lead investors, right?

14:47So one highly specialized VC, probably like the best in the class. For example, if it's a photonics, you know who are the top three photonics VCs, for example, out in the world, right? At least even if they put like a small check, it's a quality stamp. This is like, you know, highly validated technology, right? So we know it's good. Then you have a VC which can lead your next round, right? So never go for like, you know, like, never go for like set of VCs which is the last round they can participate, right? So it's better to be, okay, if they can lead series A, try them to put a small check in the seed round, just a relationship check.

15:31And then they will monitor you, they will let you know, they will know you better and they can lead series A. So, for example, that's an example. And also we say, OK, but Series A, you should also have someone who can lead your Series B and lead you all the way to IPO. So kind of think strategically about that. The combination of if it's a startup from India, for example, or Europe, right? So we recommend also to have exposure to different VCs like, okay, maybe Indian plus US or like Europe plus US. So at least you have different geographies and then you can always call them when you travel and say, hey, listen, I'm in town.

16:10Can you introduce me like to three people? Right. I'm here to kind of talk about my next round, right? So that helps a lot. if you have no one in the town, then it's difficult, right? So, I mean, we always say in deep tech, you have to leverage a lot of government funding. So there's a joke which we have between deep tech, which is in the US, saying that, you know, the good thing about us is like we're investing$1, the government gives free, right? So it's a non-dilutive funding. And we try to see that in financial models as well. So how much you're raising equity and how much you're getting non-dilutive funding.

16:43So there is, of course, we know a number of different opportunities to apply different grants in different. I think U.S., of course, it's like it's a very good environment now to be with like a lot of capital available. So that's I think a lot of people think about that as a almost like must have today to see that this is especially for very capital intensive projects. Right. If you're doing some software or like it's not that capital intensive, yeah, of course, you can just use VC money. It's fine. Right. But for capital intensive projects, it's it's. Yeah. Yeah. It's especially for the long run, too.

17:21So it's not just a short term capital allocation. It's the long 10 year journey. And as you mentioned, trying to build your roster of VCs early that will continue to be along for that ride can be important. And that starts with the very first round of funding, for sure. Exactly. You mentioned getting 200 pitches a month. It's a lot, but it's not uncommon for VCs to get dozens, if not hundreds of pitches sent to them per month. The hard part is how do you stand out as a founder? What are you looking for in some of those inbound pitches? Is it the pitch deck, the blurb? What can they say to grab your attention really quickly?

18:01so unfortunately these days because we have ai and ai agents with generating a lot of incoming messages it's almost impossible to go through my linkedin emails or um um like you know even email posts right so i i do try i honestly try to spend some time every day but it's just like for some reason there's a lot of irrelevant information uh and i can clearly see that people using AI. So it's getting more and more difficult. And I even started noticing that I am missing some of the very important messages in LinkedIn. I guess other people like me also have the same situation, right? So cold email is like last resort, right?

18:40Or cold LinkedIn message. Try to be as warm as possible and try to meet people face-to-face. Events, trade shows, meetups, try to see who is going there. If you see, for example, like I posted like, oh, I'm going to be in Tokyo next week and this conference, right? So yeah, people will, I mean, I'm sure that there's some startups will try to meet me in the corridor and say, oh, or like, let's talk. At least I will remember their face. I might like, you know, we might joke a little bit. I might remember them, right? So it's much easier to message like, we met in Tokyo, let's have a call, right?

19:14Let's have like a virtual coffee. It's much easier than just kind of absolutely like blank called email. Engaging advisors are the founders because that's what we like, right? So I love our founders which are invested. We try to build a relationship with them. And very often I ask them, recommend me another founder because I like your taste. I know you're good. Recommend me someone like you, but earlier stage, right? And if they recommend me, I'll speak to them. So that's quite common, right? So we would listen to our founders' referrals. So hopefully they don't, I mean, they don't actually recommend a lot, right?

19:54So it's only kind of very limited amount. So it's fine. I mean, so of course there's a lot of startup events. Some of them good, some of them bad. I mean, some of them like, you know, there's a lot of accelerator, demo days, investors. Like I think it's a good way to meet people, but it's also a mass market, right? So there is especially big events like, you know, have like 10 ,000 people, right? it's almost impossible to even like you live with like 2 000 cards right after that like i don't think anyone actually like i just take pictures of like the cards and they upload everything to spreadsheet using kilgayre but it's not like it's sometimes it's also very difficult to like big events i don't think they like very good for um building a proper like relationship so yeah i mean I don't know some founders they do kind of they use AI in a very smart way for example if you just like use a basic like cold email outreach you can also be a bit more smart for example say okay I read your article I really like this quote and I thought about that when you said that it's not just kind of you know personal and people say oh yeah actually they remember my quote here and it's actually interesting i mean the likelihood that people actually open this linkedin message is very low anyway but at least you're kind of building up your chances that that may be something right and i think so i can recommend two books i read recently about that as well so one is um i think it's called infinite machine right about demis hasabis and deep mind and they go through the fundraising process how deep mind how they flew to like meet Peter Thiel, then how they met Elon Musk and like kind of how they organized that, how they orchestrated meeting of Peter Thiel.

21:49So they kind of had to be a speaker on the stage then to go to this specific speaker, like VIP party where Peter Thiel was. So it's kind of, you know, it was highly, it was not like a random chance, right? No. So I think it's a good strategy, right? And I think another book which I really like is NVIDIA Way. It's about NVIDIA and how they build as well. So I think that this is like almost like kind of the manifest, right? How to build a good transformative deep tech companies. And so a lot of good tips about like generally fundraising, but not just fundraising. So highly recommend these two books.

22:24Yeah, well, we'll definitely include those in the show notes because I agree, especially both those companies being very hardware intensive and very long thinking journey companies, which a lot of founders are starting today. So those are great. Let's talk a little bit about the pitch deck. Founders create pitch decks all the time. It's one of the better ways for them to wrap their story and their company into something that feels somewhat bite-sized for us VCs to dive into. What makes a good pitch deck in your mind at a high level? And then maybe a different question. What is a slide and or slides that you gravitate towards as a VC first?

23:04So there's a lot of recommendation, right? Like, you know, like those Sequoia top pitch decks and then a lot of data points as well. How like VCs actually look like on average, like four minutes, right? So like - If that, it'll be a long time. Yeah, I think it actually decreasing every year. Yeah. Attention - With AI, to your point, it's VCs are spending, founders are spending less time creating these decks and VCs are certainly spending less time reading these decks. So, I mean, it's a very good test, right? But upload your deck to Anthropic, like to Claude, and imagine that probably most of the VCs, they have their own version of Anthropic or Gemini, whatever they use, right?

23:45So, and say, okay, imagine they upload, I mean, if it's not Indeed, 100 % they upload it and ask for feedback. So, upload it and see what would be the negative and positive idea. That's kind of a very basic check you have to do, I think, I guess, before sending it to anyone. I mean, some triggers, right? So is that what? Is that an amazing university you can mention? Is that a good advisor? Is that, I don't know, some traction you have with some kind of already some kind of amazing customer? You have amazing lead investor. Mention is like, you know, whatever you have. Don't be bashful. Yeah. Yeah, exactly.

24:23Just put like on the first slide, right? Because it kind of makes us keep reading, right? I don't think it has to be like this boring problem, solution, market. I think creativity is also refreshing. So you're like, oh, yeah, actually people put like, they have 20 engine vessels from SpaceX. Interesting. They must know what they're doing. Okay, so let me click to the next slide. That kind of uniqueness, I guess, I think that helps. I think also the other thing which I wanted to mention in the previous question about how do you meet VCs, you know, we're all using databases. We're using PitchBook, we're using Crunchbase, we're using Spectre.

25:07Everyone, because I can see that my, like, co-investors are the VCs, they're also there, right? Because I can see, like, it shows who is looking at each deal. We're probably already tracking you, right? And we're probably already looking, make sure you are in these databases and check by yourself. are you in pitch book and what does it say about your company so if i apply filter i like companies in energy press it are you going to make the cut if you are an energy company there right so people love i mean the early stage cast sees we like stealth mode companies right if you apply if you change your linkedin title like to stealth mode energy or space kind of company whatever i mean And of course, probably next day, 20 BCs fill a message on LinkedIn.

25:53Especially if you have a good pedigree and you went to the right school and you worked at the right company. Exactly right. So kind of I think it's a proactive management of like having the right presence in this database, which everyone uses them, right? So and kind of strategically positioning yourself there as well. So it's kind of, yeah, I think it can be a good strategy. Excuse me. That's great advice. I think being prepared ahead of time is a great way to get in front of it. All right, moving on to the next phase of the fundraising process. We call this the crush the initial meeting phase.

26:30What are you looking for as a VC in that initial meeting when you meet with a founder that you're hoping to see before going on to the rest of the process? us it's a very basic psychology right like play formal right and like if you're not fundraising because you have or i don't know for some reason you just closed around you have already term shared from the lead investor you have revenue i mean it's kind of making us think okay that must be something very good right they're not fundraising they don't want to talk to me i want to talk to them i want to follow them i want to i want to kind of build relationship with them right so it's Like that's, I mean, I know it's probably stupid, but I think that's worked for many of my colleagues as well and my kind of friends from other VCs.

27:20Energy, we want to have like one of the best description of the founders which we invest is people who have vision for 20 years and have like three priority tasks for next week. So it's a combination of long-term vision and very practical steps how to get there, right? Energy, kind of grit, like kind of, we always feel it, right? It's like, you know, like, is this person going to give up next month or not? Or is it, how are they going to handle that? I mean, this is something you can probably feel when you were a founder by yourself, right? So it's almost kind of invisible, I think, kind of characteristic of a founder.

27:59We like to see, I mean, everyone says traction is important in startups. Traction doesn't mean you need to show revenue, especially in deep tech. You're not expecting revenue to have on day one. It's not a software project, right? But you want to see that you have right partners. You're talking to them. You are a hustler. You can, you know, if you sign 20 LOIs, I know that probably like 19 of them will never turn into a commercial contract. But I know that you spoke to probably 200 companies and 180 of them say, no, go away. And 20 of them say, okay, I'm going to send LOI with you. So that's kind of, for us, is one of the best predictors of how good they're going to do sales, right?

28:43It's probably like next cycle that probably spoke to another 200 customers. And then, you know, we are data-driven, right? We can't just guess is the person going to be a good founder or not. We try to use as much data as we can. You kind of mentioned the thing that we hear a lot is momentum. VCs are looking for this momentum and you want to feel pulled into the conversation and that founder's journey. I know that, was it Andreessen Horowitz had this tweet recently where it's old feedback, but it surfaces every now and again that your job is to sell people that are actively trying to give you something.

29:21So VCs are always trying to give founders money. Your job is to do that, which should feel easy. But one of the best ways to do it, to your point, is to almost build this gravity and pull them into it. And one of the best ways is obviously momentum, a little bit of FOMO and showcase that you know that you're the one to do this, basically. Yes, yes, exactly. you are there any mistakes that you see founders make on these calls you know maybe not just the opposite of what you just said of you know maybe they don't tell a good story they don't pull you in any other mistakes that are even more tactical that founders make on these intro calls with you probably a bit of cliche right but like sometimes like first 15 minutes you like don't understand what people are talking about right and wow like well like i talk about like you know technology like as a abstract right or kind of we like also sometimes kind of i say okay i i give you a chance because i love technology i love science i would like to understand more about that but also like you know you know respect our time as well right so it's kind of learn about storytelling and i think that the with ai now as well it's kind of you can build a good storyline you can i mean with after several hours of talking with LLMs, I think it's possible.

30:42I always try to be, I try to speak one-to-one with the founder because I think that's kind of a little bit more kind of open and honest conversation. Then I will never invite like all my team to the first meeting, right? So I would like to understand the person, the story behind them. And I always say like, don't pitch me your product immediately. Tell me about it yourself, right? about what motivates you, why you started this company. What's the mission behind that? Because it will be difficult times in every founder journey. I mean, something inside... Sometimes it's more difficult than good ones.

31:18Exactly, but something should inside them drive them, right? So I would like to understand that, right? So kind of big mission, big idea, so which will give them energy to go through work, like, you know, late hours, kind of weekends and probably a lot of travel as well, right? So it's, yeah, so I think kind of some basic stuff, I guess. Yeah. Yeah, I like that. Are there any questions that you would recommend founders ask VCs during this meeting? Not because it comes off as showing that they're prepared or a good characteristic, but more to empower them to help take control of the process themselves.

31:55I mean, there's a lot of zombie VCs, right? So it's kind of, we call them VCs, which like between, between fun. Oh, no. That's my. Are you okay? Oh my goodness. Can you please remove? Are you okay? That's a. A backdrop. There you go. There you go. Yeah, that's probably. We can cut. Yeah, we'll cut that. We'll go here. Maybe I'll ask the question again. You want to start from there? That better? Cool. Are there any questions that you would recommend founders ask during this process? not because it's something that you look at as a positive or it comes off as like a good characteristic, but more so founders can take control of this process for themselves.

32:40Yeah, I think one of the most important questions which I always ask people to like, you know, don't be shy is like a lot of zombie VCs, right? And then people who like between funds, right? And it's okay. I mean, they keep relationship with them, build them, But like, don't kind of, don't allow yourself to believe that there's a potential term shit coming like in the next week, right? So it's okay to ask, oh, are you actively investing? Or like, even before that, go to pitch book and check when was the last investment they made. If it's like 18 months ago, there's something, you have a right to ask a question.

33:18You have capital to deploy or not, right? It's okay. You don't have to immediately drop after that. you can just okay let's just have a quick quick chat i'll tell you what we do but you know come back to i'll add you to my you know update list but then you know when you when when you have capital let us know about check size stage can they lead can they not i guess it's it's kind of just make sure that you're not it's a qualifying yeah exactly i mean a lot of these things you probably can know from the website but sometimes it's not obvious and sometimes it might be like not updated right so it's kind of important to come prepared and yeah just kind of uh have they invested in your competitor or are they considering any of your competitors now because they might just a reference call with you not actually um they just want to validate that you're like and kind of you know maybe ask about the industry how you're long how far along you are exactly or like well just kind of get some some of the insights they can help their own portfolio companies instead of investing in you right so it's kind of it's you never know it's a very fine line it's almost impossible to to get it right 100 every time but kind of be mindful of that of course yep i agree all right let's say that they've they've knocked it out of the park.

34:43They're going into the last phase of the fundraising round, which is it's the meat of it. It's a lot of ups and downs. I like to call it that's like herding cats. You are essentially trying to maintain momentum and FOMO and put together a round of funding where a large percentage of the folks that are writing checks are kind of they're waiting, they're doing their own process, they're moving at their own pace. So the question that I have for you is what advice would you give to founders that are kind of navigating this area where they're trying to bring investors together on a similar timeline.

35:13They're trying to build FOMO and momentum, but not do it in a way that maybe has them lose credibility. Any advice that you give founders kind of in this final phase where they're in the process of closing out their checks? So I think, you know, like deep tech is very different, right? So like if you were thinking, let's say, imagine like FinTech London, I don't know, like 10 years ago, right? You found the company, you send the term share the same day, you don't tell any of your friends. In deep tech, we're all friendly. There's so much capital I need to raise. Most of the funds which we work at, top funds, big funds, they always share.

35:59This is a deal. This is my investment memo. Do you want to co-invest with us? Sometimes you need to ask. Sometimes they do it by themselves. right so it's very important to have a term sheet and ideally several term sheets that they need term sheet term sheet um from from a lead VC right so don't don't jump on the first one you can wait and don't share the term sheet with like other potential need right so maybe they will have better valuation maybe they will have better terms never accept the firm term sheet You always can negotiate more small things, right? Like, just make sure, like, you know, it's all what you want, right?

36:39So, and then you have, hopefully, good people, you know, friends, advisors, this is on your cup table already, who will help you to also review this term sheet. Don't, I mean, think strategically about, you know, sometimes it's very tempting to accept the biggest variation. But think strategically, does it, like, what's the value? like is that a good brand on your cap table are they going to help are they going to lead your next round what are they going to bring apart from capital kind of ask examples and also do their own due diligence or as well so go to their website find like three companies call them and say did they help you how much did they help are they toxic are they not because a lot of this is also can be toxic right and then yeah and you're with them for 10 years yeah it's almost It's almost like a longer than average marriage now, right?

37:30So it's kind of, can you mention sitting with them on like every quarter, meet them at like quarterly board meetings, right? And are they going to block your potential M &A at some point because you have some conflict of interest, right? So there's kind of just all these questions. The good advisors will help you to also kind of potentially like ask all of these questions, right? so and you know it can be doesn't have to be one lead investor it can be several as i mentioned before right and ideally a combination like of different expertise and maybe you can think about like as a puzzle right so one which is kind of bringing reputation to the round another one bringing connections another one bringing next round capital for example right so that that's I would say ideal, right?

38:21So you have, one of them, for example, maybe can be like a strategic potential future acquirer. But also it's dangerous, right? Because you don't want to block any other potential strategic investors having a very prominent, it's kind of case by case situation, but it can be interesting. Yeah, so I guess kind of if you have time, just wait and make sure that, you know, you have selection of term shares. You chose the best, you negotiated it. like don't accept immediately think about all the terms you want to include yeah and then don't you don't have to put like everything in one closure what i normally see the good one of the best founders which i've seen like in terms of fundraising they always fundraising it's it's never like someone come to you between rounds and say by the way i missed the last deadline for the previous round but i want to put like two million now open safe open because you know you never know tomorrow might be another COVID, might be another war, another like geopolitical crisis, right?

39:21Like everyone will freeze their assets and their capital. Just if people give you money, and if it's the right VC, right person, for it to work, it's just open safe. And do a first closure, second closure. It's also very common, right? But just make sure that you like don't left kind of capital hanging around there. Just if people want to wire today, just make sure you have paperwork working place. Make sure they wire. Because again, it might happen tariffs tomorrow and people say, oh yeah, we're not wiring anymore because we are waiting for whatever head office decision, whatever. So make sure you open the doors for capital, but also give them enough time.

40:04If people would like to bring friends, great, just have a second closure. Let them to help you do. It's a very common practice that lead investor provides investment memo to other investors. in the round. For that people, yeah, people normally ask for, okay, can I speak to your lead investor GP? I normally say do it after they buy it because you don't want, you want to give like, oh, why do you, I think, are you sure about the variation? You know, you should like do less, right? Or something. So make sure like after they buy it and you can allow them to talk to other people. Yeah. I'm glad that you said that because I also encourage founders to kind of raise that way and it helps build momentum and you can close checks kind of as you go.

40:46But a lot of VCs don't like it. Even on this podcast, we've heard VCs that say that they don't like when they've come into a round where they've just missed it or that, you know, they feel like they're overpaying for something that just two weeks ago was less. And the unfortunate reality is that's the name of the game. And if that's something that you're as a VC not going to like, then, yeah, that's just the reality of how quickly some of these companies are moving and some of that momentum is built. So it's always good hearing another VC that can echo some of those same things. Yeah, but for us, if you invest like two weeks ago, now you have a huge markup.

41:19It's amazing, right? Of course. I mean, yeah, that's kind of the goal. I mean, Sequoia historically has done that as like a part of their process for a long time, where they invest in two tranches right out of the gate to have a little bit of that momentum and FOMO built in. But this has been amazing advice on the fundraising process. I think you answered a lot of questions all together, which is fantastic. Fantastic. Let's talk maybe really quickly before we head out on what happens after they close these rounds. Founders will close these rounds of funding and there's this weird snapback period where now they have to go from fundraising mode back to founder mode and builder mode.

41:55What are some of the mistakes or maybe advice that you could give to founders that have just closed their first round of funding and what happens in the first three to six months after? What are some of the common mistakes that you might see that founders can start thinking about and try to avoid? they spent all the money and... They spend it too quick. Yeah, no, I mean, that's a discipline, right? Of course. And I think it's kind of immediate hiring and people just kind of go crazy, right? So I think it's kind of financial discipline. I think kind of setting up it. Every time you raise around, you need to have more and more processes, right?

42:32And probably hire more senior people and who can help you, right? Setting up. Especially if you're a first-time founder. A lot of these things you've never experienced before. Yeah, I mean, if you need to hire at some point after series A, series B, you need to hire a proper CEO for it, who can like orchestrate for you, like the financial controls and further fundraising and everything. Right. I mean, just, and, you know, the kind of people who on the cap table, it's not just capital. Call them. I know. Don't be afraid. Just, yeah, you have some problems. You can't get through this contract in the, with one of your clients.

43:10just some delays, I don't know, with one of your kind of supply chain. Yeah, just call the Cs and ask, so what do I do, right? Can you help me? Can you pull the string? Can you advise what other portfolio companies do here, right? But some people still kind of, I mean, a lot of people take a holiday. Probably it's a good way to kind of reset and just kind of, okay, now I want to switch to a builder's mod. But it's never a builder's mod. You're always fundraising, right? Always. You still keep talking to people. But at some point, yes, you also think about events, right? When you're fundraising, you go to a lot of trade shows, a lot of events, kind of meeting a lot of people.

43:52You don't have to continue doing it like every day, every week, right? When you have enough capital, just build. And then on the go, if there is, let's say, a way for you to meet your customers or your potential future strategic partners, So kind of best way for most of the founders in my portfolio, my portfolio companies is a one-to-one meeting with the customer. Right. Of course, you need to have visibility. Of course, you need to have building brand. But the best way to sell, the best way to close fundraising, it's not in a networking event. It's a one-to-one meeting. So try to maximize that as well.

44:29For us as a VC, of course, you want to go to fundraising events or like, I mean, networking events. Right. But for founders, I think it's a little bit different. Yep. And continuing to do that and build in that muscle and the reputation and all those things is important for sure. Alexandra, this was great. You packed a lot of information into a short amount of time here. Thank you so much for being on. Where can folks continue to follow along on your globetrotting journey these days and continue to follow along with the fund? I post on LinkedIn I post on Substack Twitter is not like my favorite platform but I have email on my kind of LinkedIn page as well so I mean like we discussed about cold outreach but I mean it's actually a very good way as well just to comment with something interesting like on the post as well that's always kind of you know especially something controversial I always reply to people like okay why did you say that okay tell me more I'm interested now right So it's a good way, I guess, to engage.

45:31But yeah, I mean, happy to, I'm happy, always happy to talk to people, startup founders, deep tech. We love it. So happy to, happy to, happy. Love it. Thank you again. Hopefully you have a great trip out in Tokyo this week and hopefully we'll chat again soon. Thank you, Matt. Really enjoyed it. Thank you so much. Have a good one.

45:58Alexandra Vidyuk: But the numbers steer the ride. Conviction and precision. Watch investors collide.