SuperVenture Hot Takes: 2 Key Factors for Sourcing Deals in Difficult Economic Times
In June, Join Partner Jan Borgstädt participated in a panel at Berlin’s SuperVenture conference for VCs and LPs. Alongside Moderator Adam Thatcher (Associate, Goodwin) and panelists Saloni Bhojwani (Co-Founder & Partner, Pink Salt Ventures), Adam Niewiński (Co-Founder & General Partner, OTB) and Mark Sherman (Managing Partner, Telstra Ventures), Jan touched on several topics surrounding a VC’s methodology and approach during a possible recession or economic hardship.
We had two favorite takeaways from the panel.
It’s paramount to have a “compass” for sourcing deals that works for you, and it’s not one-size-fits-all.
VCs can go about sourcing deals in various ways, from highly data-driven and software-driven strategies, to more “traditional” network-driven strategies. Here are a few perspectives we heard on the panel:
- This recipe for success is never the same for every investor, but rather it depends on the stage of the deal, the verticals involved and many other factors.
- Oftentimes, later stage investors can rely increasingly on trusted contacts within their network to alert them about key opportunities.
- Working on relationships with partners, such as seed funds, angels, etc. is important, as is working with founders who are able to spread the word to other founders about how a specific VC supports them.
- Branding can be a viable strategy. Jan mentioned that understanding the niche in which Join operates — and communicating that to founders who are in search of customers — is the way that we have found success.
It’s more valuable in the long term to focus on big problems, not trends.
When VCs focus on the biggest problems in today’s world, their deals can be more immune to economic fluctuations or crashes in VC valuations.
Global issues that large corporates face, for example, include carbon offsetting, cybersecurity, talent sourcing, rising energy prices and supply chain disruptions. These problems aren’t going away as the world’s population grows. Technology is the solution, and it’s young startups who are agile enough to build and market this tech.
Usually, large corporates don’t have the resources to create the solutions they need. That’s why funding startups based on these large problems is so important; in this way, the right technology can reach the right hands with ample resources to scale it.
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