Starting up in Venture – 643 companies, 37 investments

Starting up in Venture: After our first 12 months in operation, we look back at 2017 and look forward to 2018.

Dec 2017 marked 12 months since the launch of Accelerated Digital Ventures (ADV).

We set up as a company rather than a fund to invest patient capital throughout the lifecycle of digital tech businesses which want to scale big. Our investors (Legal & General and Woodford Investment Management) bought shares in ADV as a company. We can invest early through a British Business Bank partnered ECF fund and can invest in later rounds from our balance sheet.

We’ve built a platform-based investment process, recognising that the best ideas come from everywhere and warm introductions shouldn’t be the only way in. Since launching the platform in May 2017, 643 companies have registered, spread across Seed (476), Venture (143) and Growth stage (24).

Every opportunity is reviewed by three members of our team against our initial criteria which is focused primarily on opportunity, team and timing. We aim to determine whether or not the business can be generation-defining, and scale big in the future.

Entrepreneurs applying for funding and our co-investors see all of our team’s analyses and due diligence (we’ve now co-invested with approximately 15 VCs). We believe the transparency of the audit trail is crucial for founders when raising growth capital in the mid to long term.

We’ve been seriously  impressed with the breadth and quality of deals we’ve seen. In our first year we made 33 direct investments (including two follow-ons). We also invested in two seed funds: Episode 1 and Seedcamp; and through two accelerators: Ignite and Techstars. To invest at volume we’ve scaled our team, with 15 full time employees spread across the UK and from all walks of life. We don’t have an office and are constantly on the road, so let us know if we haven’t met yet!

We’ve proven a lot of things to ourselves and our investors. You can build a platform-based approach to investment; there is a wealth of amazing entrepreneurs across the UK and Ireland; there is a funding gap in UK Venture which large institutional investors can fill; and European tech is open to new ways of doing things.

In 2018 we intend to test and prove much more. Below are some key areas of focus for us this year and what they mean in practice.

Making fundraising transparent

We want to increase the openness of the venture investment process for businesses at each stage. We’ve built an internal platform and are now testing the Venture Market, an open and collaborative platform which we want to share with the ecosystem. Watch this space…

Improving the ‘venture pathway’ outside London

Funding options for highly ambitious entrepreneurs outside London are far more scarce. Our team is dispersed across eight major UK cities and we want to work with others determined to add more localised risk capital.

Angels and Microfunds are key to ecosystem growth

Angels and emergent Microfunds are the top performers in identifying early stage startups. London has some brilliant examples and we’ve invested in two of them – Seedcamp and Episode 1 – and intend to support the build up of many more, especially outside London.

The UK funding gap can be filled by Institutional Capital

The Government’s Patient Capital Review was a recognition not only of the potential impact of the withdrawal of the European Investment Bank but also that a funding gap already exists in UK venture capital. ADV was built on this notion and we believe this gap can only be properly addressed with the support of large scale institutional investors such as our own.

Some useful information:

– We’ve published our standard term sheets, along with user guides:

– We’ve published our investment criteria, with focus on three companies types:

– We’ve outlined our investment process, to add clarity for entrepreneurs raising investment from ADV: