The Join Capital Partner Q&A: Jan Borgstädt
Since co-founding Join Capital in 2015, Jan has been entrenched in the European industrial tech landscape. We spoke with him about what has changed in the ecosystem, how Join returned investor capital early, and how being a first-mover has allowed for an advantageous position in an increasingly crowded VC market.
Hi Jan. How would you describe Join’s vision today?
Our vision is, first and foremost, to invest in the new crop of technical founders that are creating the most exciting technical landscape we’ve ever seen in Europe. Europe is increasingly becoming a fertile ground for great technology in the same way that the west coast of the U.S. has been for decades. Part of that is many startups being founded by engineers and software developers, versus the more business-oriented people. The real heart of the technology is starting to develop in Europe.
This is in contrast to what we have long seen with founders who have simply taken advantage of market opportunities in Europe by importing and repackaging successful U.S. business models.
Europe is simply a great place to invest in technical founders today. We’re a part of this upward trajectory in which more and more founders are tech-driven.
That brings us into the next question: What makes Join Capital stand out for these founders?
We give them not only capital, but also connect them with customers to help them prove their vision and technology.
Part of our DNA is that from the moment someone pitches us, we are already trying to envision how their technology could solve real problems. We try to bring in our more advanced understanding of what bigger companies’ needs are, having been in the ecosystem for decades now. We know the customer problem, and is the company pitching us going to meet that need? Who could be an early customer for this?
I’m sure that founders appreciate this foresight.
Yes, if you ask companies which is better, capital or revenue, it’s always going to be revenue. Of course revenue is not diluting your shareholding, and revenue generates capital. So we want to bring in those early customers that can lead to revenue, while we give capital to help them develop and improve their product.
To add to that, another special aspect of Join that I think goes along with this is our relationship-building. For example, the night before our Portfolio Day, I suggested that three of our founders who are working in the same ecosystem get together and help each other out. Exchange customer contacts. If we can facilitate this more, we can scale more. There is a personal, face-to-face connection that you get through this type of relationship-building that is very valuable and fruitful.
Join was a first-mover in industrial and enterprise VC back in 2015. How do you think this gives you a better vantage point for trends and opportunities?
Yes, so we have two segments we need to consider — the LPs and the founders. I think for both, they are looking for experience in the field. Someone with a track record of investing in their space, who has proven that they can help build great companies and also exit them. I always encourage founders to do due diligence on their potential VCs. If they did due diligence on Join, they’d find we can offer a lot more than just a wire transfer. That’s first-mover advantage today — the track record and network that can’t be built in a year or two. It’s a decade of solid work in this ecosystem.
Can we talk maybe about how different it was back in the day to convince LPs of your USP versus now?
LPs are looking for a track record, and in general, you have to offer something different to them than what existing funds already offer. This has never changed. But back then, there wasn’t anyone really working intensively in the industrial ecosystem. We would tell them, even though we cannot show you that we’ve invested a lot into these companies in the past, this market is going to flourish. So it was more about convincing of the potential. It was definitely more difficult than telling them what we can tell them now: That we’ve made returns in the segment.
So now, new VCs are having to become even more niche.
Yes, that’s a big change in the ecosystem. Thirty years ago, a VC would have said, “Ah, you’re starting a company! Great. Come on over, let’s have a coffee.” There weren’t enough startups and things weren’t specialized or differentiated.
Can you give us examples of some recent triumphs, milestones and successes?
One is that a lot of our companies have received follow-on funding. That means the sectors and companies we invest in are attractive, and people believe in their value.
The second milestone was definitely that we were able to exit three companies in 2021 and 2022. We did this just four years after starting the fund, so we had early exits — and to two buyers that we had foreseen. With Autodesk, for example, they were already in design and wanted to get into production. So they bought Prodsmart. With HQ acquiring Office App, we had already outlined a thesis that large US players would like to acquire European leaders. This was confirmed.
It of course felt great to be able to pay back our investors their money — to give back to those who trusted us.
I would also say making ten investments in Fund II is another milestone. And finally, team-wise, we were able to hire a senior team. So by making Wanjiru and Julia principals, this really has shown the team’s growth within the decade — to build an organization that is going to last beyond ourselves.
Learn more about Join Capital by reaching out to us: hello@join.capital.
