Steve Lemon, Partner at Volution
12 September 2022
Since leaving Currencycloud, I’ve had a lot of people asking me what I’m doing next. Many who knew I was joining a boutique investment firm have asked why on earth would I want to be a VC, and am I sure I know what I’m doing…
When we established Currencycloud, we quickly realised any ambition of bootstrapping is all but impossible — this is especially true now in fintech and SaaS.
Building a fintech business is a massive undertaking. You need a lot of cash, deep domain & functional expertise, a support network and a little luck. There are always unforeseen costs, challenges and changes to the landscape that need navigating.
We were fortunate — we had a great investor base who provided a lot more than just access to capital. They played a critical role in helping us get stood up and break through. They provided help, guidance, mentors, and domain experts to help us through the growth phase and into new segments & evolving go-to-market strategies.
Behind the scenes there was also a lot of support at exec and senior leadership level to help with structural changes and the inevitable growing pains. And finally, a huge amount of help and guidance in the sale process — not just to ensure the best outcome for shareholders but to find the right cultural fit between the new owners and our incredible people. This last part was more important to our investors and leadership team than many realise.
There are lots of milestones and achievements on the journey of any company — from the germination of the idea, bringing together a team behind the idea, releasing an MVP, establishing product market fit and go to market strategies.
And of course, any founder is always looking for that final milestone, the exit. No matter how noble or altruistic the company’s vision and mission might be, you’re looking for the transaction at the end of your journey. Your investors certainly are.
So for me, moving to the other side of the table — joining a venture firm — isn’t just a new business opportunity, it’s payback to the community. Payback for all the support I took over the last thirteen years.
But what about those who still think I’m mad to join a boutique firm, in the current macro environment, with all the chaos in the world? And more specifically, given how tough the Venture market is at the moment?
For me it’s simple. We decided to establish Currencycloud, with many novel approaches (we were first with FX & payments via API and first with FX pricing transparency — all considered ‘madness’ at the time) in the immediate aftermath of the Global Financial Crisis. It was far harder than we expected but the founders’ vision and grit and determination got us through — and it worked out pretty well in the end — so I happen to think this is probably a pretty good time to join a firm with its best days ahead.
We’ve seen a massive correction in valuations in both public and private markets (it’s impossible to call a market top, but credit to Mike Laven; he pretty much did that despite many of us lobbying to keep going), so I think the period of crazy inflated valuations is over.
But more importantly, Volution’s current strategy of helping plug funding gaps between formal funding rounds really resonates with my own experience.
We had real challenges between rounds A & B, and between B & C. For any entrepreneur, it’s challenging enough building a business without having to navigate the peculiarities of the funding market. You just want the right amount of capital, on a basis that makes sense, at the right time. Volution provides this.
I’m joining a great team, with a real depth of experience. We have a fantastic portfolio, compelling niche, and bold ideas for changes we think we can make to the venture market.
I’m confident that the (often hard) learnings, experiences and network contacts I collated over the last 13 years will add value to both our portfolio companies and our business. I see a huge opportunity to help grow Volution into a leading multi fund, multi strategy, investment management business, working with inspirational founders and serving an ecosystem I know well.
Now that’s exciting.
