Meet the investor: Carlos Espinal, Seedcamp

Partner of the 'first round fund' which has helped TransferWise succeed, Espinal explains why investing is all about relationships...

Firm: Seedcamp           
Name: Carlos Espinal

Where are you based?

We’re based in Campus London, Google’s co-working space, near the Old Street Roundabout.

What kind of investor are you?

Seedcamp is an early-stage investment fund and support platform. We invest in both pre-seed (really early, usually with only a few founders) and seed stage (early, but with one or more employees, and co-investors).

We provide our founders with capital, a global network of mentors and fellow founders, and experienced advice.

What kind of person do you invest in?

We look for ambitious, globally-minded founders who can execute quickly and know how to iterate to find product market fit.

What is your ideal investment?

In addition to great founders, we look for businesses that dramatically change the economics for a large target market by either democratising access or cost. We back businesses with an amazing vision of how to transform industries.

How do you source prospects?

Investing, like most things, is all about relationships. The best investments we’ve made have come through recommendations to our pre-seed process, or direct introductions to our seed investment process.

What are the hot sectors?

Hot sectors come and go… today’s hot sectors range from ‘robots’ to ‘fintech’.

However, it’s best to not get fixated on hot sectors. Rather look for where innovation will be – by the time a sector is ‘hot’ it is likely to be frothy.

Three things a company should be able to offer an investor?

I’d like to flip the question to ‘What are the three things an investor should offer a company?!’ These would be:

  1. Capital
  2. A strong network to open doors
  3. Experienced advice to help founders’ reduce their mistakes

What is the cardinal sin when looking for investment?

From the point of view of a founder: Reaching out to investors without (a) seeking a warm introduction, and (b) not doing your homework on the areas and size of focus of the investor you are reaching out to.

From the point of view of an investor: Falling in love with an idea and perhaps even seeing into the future of an idea through your eyes, rather than through the founder’s vision and team.

What continuing involvement do you like in an investment?

We have a support platform that provides our founders access to a distributed network of experienced founders, mentors and investors, as well as a structured series of sessions the help get to the key areas that create issues in start-ups early.

The needs of our companies change over time as they scale, but we continually provide support throughout their lifespan.

What has been your best performing investment to date?

We have several companies we are proud of. One of our biggest successes is TransferWise; we were the first investor in the company and we’ve since seen the team expand to over 300 employees, open offices around the world and take on significant rounds of investment.

Property Partner is another stand-out company in our portfolio which has also taken on further investment from later-stage venture capital (VC) firms including Index Ventures.

Younger teams that show a lot of promise are ByeBuy, Finance Fox and Revolut. We’ve also had 14 exits with great success for GrabCad and more recently, Stupeflix, which was acquired by GoPro.

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  1. Hi Carlos,

    I liked your interview and determined, to-the-point answers. However, I have 3 questions and look forward to your answers:

    Question 1: if someone has an idea for product and has already built prototype and product and believes it is good competitor to similar products and ready for starting new business and inviting investors. What is the best route he should take to approach investors?

    Question 2: How founder can test the eligibility of his business for investment?

    Question 3: I liked your point that investor can also help with “strong network to open doors”, how to reach investors who can help in that not only fund injectors?

    Regards.

    Hesham.