Ep 13 - Oscar Williams - Angel & VC Investor

0:00 Hi, welcome to the founders and funded podcast. I'm your host, Philip Smith. On the podcast, I'll be interviewing founders, investors, startup advisors on how to fund the journey of your startup and some tips and advice they have for you along the way. This podcast is sponsored by Perfect Technologies. Enjoy the episode I ask you Welcome to the founders and Fun in podcast. Thanks a lot, Phil. Great to be here. It's really it's my pleasure to have you here, Oscar. Just so listeners know who's on, could you please state your name and your role? Yeah, absolutely. So I kind of have a few roles at the moment, which I'm sure we'll dig into, but I'm Oscar Williams.

0:42 So I've been a VC investor, Angel investor. I'm a ambassador for Climate Connection events here as well, and a mentor for early stage deep tech startups. Fantastic. And to ask, how did you get into that? Yeah, absolutely. It's been a long and winding path, so I won't bore you with all of the details. But basically for the last, my whole professional life, I've kind of danced around early stage innovation, mainly on the climate side of things, all the way from policy to corporate R&D to academic research, start up work, consulting. And the kind of golden thread was, I think venture is a great space to propel innovation.

1:29 I think innovation's a great thing to better our societies and people need money. So I went into the investing sides and yeah, that's kind of the short version of it. Well, look, it's great that LED you, LED you here. And I suppose tell me a bit more about Climate Connection as a as a company. Yeah, absolutely. So it's umm, one of the biggest, uh, UK based, uh, climate events, kind of, uh, team, umm, they run regular monthly kind of, umm, meetings between that bring together investors, early stage founders and everyone policy makers, everyone working in early stage primarily kind of precede to Series A series B maybe and beyond sometimes, but largely in that kind of sweet spot, people working in the ecosystem brings them together.

2:29 And the whole point is, can we make that kind of ecosystem better? They've recently kind of launched a connection studio, which is not climate specific as well, which kind of takes it beyond that and helps founders basically get good stuff done. So yeah, definitely check it out. Absolutely. That sounds, that sounds very cool actually. And and what does an average day look like right now? Yeah, I mean, the pithy answer to that is there is no average day. I think in anything that kind of involves early stage deep tech, average day is a bit of a myth and I like it that way. But currently right now for me, I'm doing quite a few different roles.

3:12 So I kind of mentioned I'm doing a bit of investing, I'm doing freelance kind of consulting, I'm setting up an advisory with a couple of my mates to help early stage founders, and I'm doing this ambassador role for Climate Connection. So really I set my own structure most days, you know, might include speaking to a founder. That's what I love to do. I love writing. So I also carve out a writing block and they'll be the kind of the usual habitual things that we will try and do, you know, exercise, spend time with loved ones, all of that stuff. But it's kind of all around what can I be putting my energy into to help early stage investors on that day? Whether that's a consulting gig, whether that's a mentoring gig that I do off my back, whether it's helping map out non dilutive funding for climate connection, that's what I'm doing right now with that.

4:04 It's so across the board. It's all sorts of things, really. Yeah, but that's part of it is just trying to the different ways you can showcase your expertise and how different ways you can help people. Are you looking at that? So I know you're the mentor of the University of Oxford as well. Yeah, that's right. Yeah, Yeah. With the the kind of newly set up climate ventures cohort that they've got there, which is recently come to a close, actually their first sort of cohort. So, yeah, it's been a lot of fun to be part of that and help kind of give back to the community a little bit and feed into this beautiful flywheel of venture ecosystem that we have.

4:46 Yeah, that I really like that, especially those, you know, the, the, the students starting that, that your journey and how much you can shape how that goes for them. And you're an investor as well with the Hustle Fund. Yeah, that's right. Yeah. So the Hustle funds, yeah, that's, they've ran kind of great sort of transparent cohorts that lets people with minimal investment often a kind of look into their VC process. So I've been there as an Angel investor and a kind of observer for a few years now. I kind of used it as one of the springboards to get into venture capital investing and to learn about it, and I've stayed kind of a member as part of that.

5:31 So, yeah, they're American based, but they have a great process. They get involved with some really good investments. It's a bit broader than kind of the climate tech and deep tech things that I usually focus on, but it's, yeah, really kind of vibrant community and an excellent initiative that they set up there. Yeah. It's really interesting to look at the invest, you know, kind of earlier the proceed even which is, which is very, very interesting to me. And I suppose looking at some of the, you know, could you talk to me about some of the startups you've invested in and why you invested into those startups? Yeah. So I'll kind of focus on the climate hard tech kind of niche that I've found myself in. And probably the best lens to look at after is the most recent VC fund that I was with, which is Visionaries tomorrow. So short headline about them.

6:24 They are early stage, so precede and seed Berlin based industrial deep tech fund. So primarily do hardware, but they also do a little bit of software. So yeah, a couple of kind of interesting ones that I can run you past. I think one of the biggest tickets that they've done and one of the kind of most high profile tickets that they've done is Proxima Fusion. So they're basically Europe's shot at a sovereign fusion fusion champion for clean energy generation. I mean, I've always thought fusion is cool. It's basically free energy or if you get it working at commercial scale and that's super kind of attractive.

7:08 But they have a real kind of amazing combination of Max Planck Institute. So this kind of hundreds of years old research institution with decades of stellarator heritage. So stellarator is the type of kind of technology that they use to produce the fusion and to kind of magnetically confine the plasma and a really kind of robust commercial road map from simulation to hardware and a strong view of kind of fusion as a base load infrastructure to plug into real industrial loads. So it's kind of making this fantastical, amazing vision and dream of fusion much more tangible and kind of risk mitigated as we go.

7:50 So it's it's kind of yeah, that really appealed to me. Another one. Oh yeah. I don't know if you want me to carry on, but I can talk about a couple of others if you want. Oh, please do. Amazing, amazing. So yeah. And then less energy specific, but energy adjacent hour ago was another one. It's basically optical computing. So that's looking at this kind of trend of Moore's law reaching it's kind of thermodynamic limits of electric kind of transistors getting smaller and smaller year on year. That's going to keep going for a while, but it will hit a limit and that is based on kind of noise that's at the sort of almost quantum level and that will kind of produce a physical limit on electronics.

8:39 So one way to get around this, there are quite a few different potential ways is can we use light instead of electricity? So we've all heard about AI and the kind of the kind of inference kind of computations that they need to do. And that's just exponentially increasing like crazy. And we know about the energy drain on that as well. And as we need to do ever more kind of complex matrix multiplications, which is the kind of primary computation that underpins that type of work that they do, we'll need smaller and smaller kit and we'll need to be more and more energy efficient.

9:20 So light is 1 potential way to do that. And again, ergo have an incredible team. And basically light does the linear, linear algebra essentially for free in terms of latency and energy, not quite for free, but much cheaper in terms of energy wastage than electronics. So another kind of moon shot that sounds like it should be in a sci-fi film. Yeah. But they also again have clear roots kind of commercialization and it's and it's amazing, you know, just for reference, we already do some things in optical like so fibre optics, we all know about that.

10:01 That's what probably brings your broadband to your house that's transmitted with light. And this is kind of the next evolution of that, doing computation within light, so within the optical domain, as they call it. So, yeah, those are the kind of bets that I really like. Big, bold, beautiful. I think that's what venture capital should be about. It's kind of how do we move that needle? How do we get returns that seem outrageously outsized compared to what we put into it? So yeah, bring on the future. Yeah, but that's what's exciting about, you know, entrepreneurship on that approach, you play this like you want to see startups that can change the world and change people's lives.

10:45 You know, that that's what makes it so exciting. And on the investment side, you want to be able to invest and startup has so much potential that there are wise, you know, crazy or seems, you know, insane. That's, you know, that's, I think you're in a really good space and industry to to achieve both of those things and to look at, you know, you know, I suppose a bit broader than Oscar. What is the best way to fund a startup's journey in your opinion? Yeah, absolutely. I mean, I think it's a great question. I mean most recently I've been with VC, but I've been in quite a few different roles throughout my kind of decade long, so also career. So I've seen quite a lot of areas of innovation kind of funding. And I would say while VC can be great, it's it is a tool and I always kind of try and look at it from the founder, the people you know, who are actually building the stuff, doing the good work.

11:41 I would say it's a tool, not a religion. So especially when I'm looking at deep tech and hard tech, the right funding stack really depends on the type of risk that you're looking at the product cycle that you're doing. So for things like I mentioned like fusion or like advanced manufacturing water materials, you really want a mixed capital capital stack. I wouldn't say that VC is the only answer and it might be a part of the answer. It might not be a part of the answer depending on the stage that you're at. What you also want to want to involve in the mix are non dilutive grants. So currently with my volunteer work with the Climate Connection as an ambassador, we're mapping out UK kind of non dilutive grants and seeing what's out there and helping to kind of make sense of the different governmental structures that we have and how innovation can get money.

12:36 But there's also other kind of ways like working with corporates to develop contracts and joint ventures, strategic kind of piloting kind of endeavours with those sort of type of corporations. And yeah, really with institutional VC, I would say to a founder, you need to make sure that there's a line of sight to kind of repeatable deployments. And that's kind of this recurring revenue that VCs kind of look for. And I can speak more about that. But on the climate kind of side of things, we're seeing more infrastructure kind of shaped models and kind of what I mean by that is can you basically act as like an independent power provider IPP style? That's kind of yes, yeah, like vehicles for heat, water storage or process upgrades.

13:23 So like basically you have like a special purpose vehicle of funding for a project that rages raises like project finance that pays the start up like via long term offtake or equipment leases and things like that. We're seeing more and more of these kind of more inventive ways to get around the valley of death for like hardware kind of. And how do you mitigate those guests, those kind of risks earlier and kind of secure these kind of lines to more long term funding, which then future funding backers like banks and things like that will see as very positive signals? Obviously, if we look at the software side of things, that's quite different.

14:05 But I guess my kind of niche is usually on the hardware type of things. So yeah, it's super exciting. And I, I think we'll see a lot of very interesting different funding vehicles emerging as we move forwards and I think that's a great thing. Yeah, like it's certainly it's still such a change in space and there are all those different, there's so many options now to get fun. And as as you mentioned, I think particularly interesting there was was orchestrating kind of joint ventures and partnerships and pilots. I think that's a really great thing because it gives companies a chance to, you know, actually, you know, secure their first clients in revenue, but be able to put it out into the field and, and show your customers what their product can do, which is really important to look at the founding team a bit. Then are there certain skills you you think founders should possess?

14:56 Or, you know, like what? What do you look for in founders that would make you want to invest in their startup? Yeah, I love, I mean, I spend a lot of time thinking about this. And obviously, especially with early stage venture, when you're investing into that, you're investing into the people, the idea might change quite a few different times. Ideally, they will pivot and they will listen to the market. I mean, of course, yeah, it'd be great if you could get the perfect idea from the beginning, but it's so rare that that happens. So, yeah, I mean, I think there are a few traits that I kind of overweight usually I guess when I look at deep tech specifically and kind of maybe an overarching sort of lens that I try and look at it through.

15:45 So the baseline for that would be technical credibility. So and then the differentiator is translation. So the founders who stand out for me can move fluently between whiteboard equations, getting really technical nitty gritty, talking about plant manager kind of constraints and things like that, and then moving into investor economics, you know, without breaking a sweat and making it all sound like a kind of coherent narrative. We often positioned ourselves previously as like tech translators, as VCs because we had technical mindsets that we could help founders translate their ideas into more investment friendly kind of language that makes sense for people. For example, I think founders who can tell that narrative, that's always a great signal.

16:35 And then yeah, in terms of maybe more specific kind of traits that I look at, I think this is good for any type of founder intellectual honesty. So how clearly do they talk about unknowns and failure modes? Because it'll be complete BS if we all, if we all think that we have all the answers from the offset. And yeah, I mean, I think it's easy to fall into that trap because you want to make a perfect slide deck that it has your route to 1 trillion, you know, Tam or whatever it is. And that's just not how it works for me in reality.

17:16 If you can talk about here are we, here's where we expect to fail, here are what we don't know, and here's how we're going to figure that out and mitigate those risks as we go. I think that's so much better than selling me ABS narrative basically. Yeah, that's a really good point. Like I think, you know, that's a really, really strong piece of advice I think for instead of founders. And when they pitch, because they do, they do paint this kind of perfect world and perfect picture where and you know and they know and the investor knows that that's not the case. And if you think you understand the challenges, how to circumvent them, I think that's a lot more attractive. And from the start up side, how can those companies attract investors more effectively?

18:04 Yeah. And I would just to add to your previous point as well, add to that kind of point we just discussed as well, which feeds into this. It does depend on the type of investor you're looking, you're kind of speaking to. So I'm coming with a technical mindset and I have to, I have to caveat what I've said with that because I know what it's like to make stuff. I know what it's like to spend 90% of my PhD fixing broken lab equipment. And I know how that translates into commercial as well. You know, it doesn't the problems don't go away. But yeah, you know, so, yeah, just to make sure that that's clear, because for some investors, you do want to lean into the BSA little bit more.

18:48 But yeah, that, that varies. So there's a balance to to go for, but yeah. So how can companies attract investors more effectively? Just returning to that, I would say that the most effective fundraising that I've seen from thousands of companies that I've looked at, it's less like a roadshow and more like a gravity well, if that makes sense. So a company that's obviously doing the work, they have some traction, whether that's these joint ventures that we've talked about, whether it's pilots running, whether it's letters of intent, regulatory conversations in progress. They are kind of creating an ecosystem that makes them indispensable within that space, that attracts investors and that attracts attention and it is super exciting at that point.

19:44 So of course, you know, things like networks really matter. Warming and Audreys matter, of course. But I would say the strongest signal isn't how many investors you've met. It's like, how can you turn those conversations into sharper hypotheses? How can you use everything that you're doing as part of your process to improve on your business model, on your idea? So. If I have a chat with the founder and we have some pain points that we discuss or whatever, and then the next meeting we have, there's been no change to the deck or the road map. I'm not going to say that I have all the answers, but I will say why. If we were kind of all nodding and agreeing and saying all these are issues, why hasn't anything changed? So it's kind of that coach ability side of things, I think. Yeah, being open to speak and realizing that it's a partnership that's a long term kind of investment from both sides.

20:36 It's a marriage, right? It's yeah, yeah, yeah. Not to kind of speak too much in cliches, but yeah, it's yeah, it's kind of having that holistic view and trying not to see, trying to make funding work for you and that process work for you and better your kind of whole journey. I think that's a really effective way of doing it and much more effective than kind of just seeing fundraising as like a time sink which doesn't add any value, which it's very easy to see it like that. I get it. Yeah, Yeah. I think that you've probably probably answer my next question ask in terms of what, like what, what what is one key piece of advice to share and fund a startup? Yeah, absolutely.

21:21 Yeah. So yeah, I would say yeah, it's kind of bats that marriage point. It's, it's a marriage, not a fling. So it's long term relationships and gains and like who do you want to kind of enter a marriage with? Like, So what does that BC bring to the table for you? It's, it's very difficult when there are of course there isn't really a symmetrical system here, right, where there are a lot more startups looking for money and the VCs kind of have that power, but you want partners who will not abuse that kind of power dynamic and they will bring things to the table for you as well. I would say returning to our mixed capital stack where we're talking about grants and JVS and other kind of structures as well, make VC compete with other capital. If you can say that VC brings you something tangible to your kind of system.

22:24 If all you need is money and that's also understandable, but do it with eyes wide open because it's easy to jump into bed with someone. It's a very different matter kind of entering into a long term marriage, right. Not to overuse that kind of metaphor too much, but yeah, yeah. So I'd see I'd say treat treat fundraising as an architecture, not as just a single one off event. Yeah, I think that's a good finisher for a lot of really good advice. Like it's it certainly is that the cliche isn't wrong. Like it certainly is like a marriage. And I think so many founders to kind of rush into it for, you know, the money rather than, you know, all the other things that go that like the the character and investor or the industry they're in, what expertise they can share and so on.

23:09 So there's a lot more to it. And Oscar, thanks so much for coming to the podcast. That was a really nice conversation. You shared a lot there, I think, and obviously with the cloudy tech industry, but I think even brought a lot for founders and investors even to take away. Thanks a lot, Phil Yeah, it was a real pleasure. And yeah, hopefully it's a bit of help for people. Would love people to reach out and always happy to chat and share more ideas as well. But yeah, thanks again for inviting me along. Cheers. Thanks, Oscar. Hi, thanks for listening to this weeks episode of the Founders and Funding podcast. If you'd like to be a guest or have a guest suggestion, please get in touch. Thank you.