In episode 62 of the 20 minutes VC, host Harry Stebings interviews Fede Persio Biroli, founder of Playfair Capital, a significant player in London's seed-stage tech startup scene. Biroli shares his unconventional journey from working in the NGO sector in East Africa to becoming an influential venture capitalist. His experience in the NGO industry led to a realization about the importance of entrepreneurship for economic growth, prompting his shift to investing. Biroli discusses Playfair's investment approach, including an average ticket size of 200-250k, a focus on seed-stage ventures, and an openness to Series A investments. He highlights the value of Warner Yard, Playfair's co-working space, in fostering a vibrant community and supporting portfolio companies, particularly through recruitment challenges. Biroli also touches on the importance of founders' resourcefulness and grit, as exemplified by portfolio companies like Appear Here and Dojo. Despite the evolving seed funding landscape, Playfair differentiates itself through hands-on support and a unique fund structure, where Biroli serves as both the managing partner and sole LP, allowing for flexible and founder-friendly investments.
"And on today's incredible episode of the 20 minutes VC, we are welcoming Fede Persio Biroli, founder at Playfair Capital, to the show." "Fede founded Playfair Capital from his first investment in December of 2010, and the portfolio has grown quickly to 20 investments by the end of 2012, including the likes of due deal appear here and on device research."
The quotes highlight Fede's role as the founder of Playfair Capital and the rapid growth of the company's investment portfolio, emphasizing its influence in the startup ecosystem.
"I had actually spent pretty much a total of, I think about four years working in various different jobs within the NGO industry." "I realized that actually, this is trying to solve a problem from the inside. And actually, without taking a step back to look at how kind of the effects this industry had had on the economic environment of the countries they were operating in."
These quotes detail Fede's extensive work in the NGO sector and his critical perspective on its long-term effects on local economies, which influenced his pivot to venture capital.
"And so that's what made me start thinking about entrepreneurship." "Every single one of them that gets kind of attracted to going to work for an NGO, comes at the opportunity cost of not becoming an entrepreneur."
These quotes express Fede's belief in the transformative power of entrepreneurship over traditional NGO work, which guided his investment strategy.
"So I invested in Judy in late 2010, and very soon after that, I was very lucky enough to meet passion capital." "I ended up investing in 21 or 22 companies."
These quotes outline Fede's early investment activities, including his collaboration with Passion Capital and the number of companies he invested in, showcasing his active engagement in the startup investment space.
"everything's been built reactively and not proactively."
The quote explains that the development of Playfair Capital was a response to emerging needs rather than a premeditated strategy, highlighting the importance of adaptability in business growth.
"I am both the GP or the managing partner and the only LP."
This quote clarifies the unique financial structure of Playfair Capital, where Fede Piersio Biroli holds dual roles, impacting the firm's operational incentives and team motivation strategies.
"80% of the carry goes to me as the LP, and then I have an allocation, or the fund has an allocation of 20% of its carry that gets distributed amongst the team."
The quote details the carry distribution at Playfair Capital, emphasizing the innovative approach to team compensation and the strategic allocation of financial incentives to motivate and retain employees.
"the average ticket size is somewhere between 200 and 250k. We are overwhelmingly investing at the seed stage."
This quote summarizes Playfair Capital's investment strategy, including their preferred funding stage and ticket size, and highlights the firm's agility due to its independent financial structure.
"I've seen the seed funding environment change enormously since I started out, which is admittedly not even that long ago."
The quote reflects on the transformation of the seed funding environment over a relatively short period, noting the increased competition and capital availability that new financial incentives have introduced.
"Look, firstly, we have Warner Yard, which is this co working space that I'm in now, where we have 180 desks and we have kind of a vibrant community."
This quote emphasizes the physical space and community aspect that Warner Yard provides, setting it apart from other venture capital firms.
"And we are deploying amongst portfolio companies to hire ctos, front end, back end, full stack devs, entirely engineering focused at our cost, because of the nightmare that kind of so many portfolio companies seem to have in terms of hiring."
This quote highlights the proactive approach in assisting portfolio companies with hiring technical staff, a common challenge for startups.
"I think it's very important. I'm biased for a variety of reasons, namely that my entire kind of development in this world as an investor was basically at a co working environment."
The speaker attributes their personal development as an investor to the benefits of working in a co-working space, suggesting its importance.
"We're not looking just to fill the space, we're looking to fill the space with interesting people, because the value of the space very much depends on the quality of the people in it."
This quote underlines the selective process for tenants, aiming to foster a community of high-quality individuals that can benefit from each other.
"It's an ephemeral environment that is always different. And with tech stars in the building that twice a year move in ten teams at a time, it means, you know, I mean, techstars here."
The quote describes the ever-changing environment of Warner Yard, which is kept fresh and engaging through the regular influx of new teams from programs like Techstars.
"Investors often pay more for serial entrepreneurs, people who have been through kind of ups and downs, hiring, firing, the pains of having to wind a company down."
This quote indicates the value placed on the experience of serial entrepreneurs, who have navigated the complexities of running a business.
"Making something out of very few resources is definitely an admirable trait and also kind of a lack of entitlement or expectation."
The speaker admires founders who can build a company with minimal resources and without a sense of entitlement, suggesting these are qualities they look for in potential investments.
"And that's what propelled him into kind of, into actually going somewhat viral and having some of his friends say, oh, so what? Know, we want a pop up shop."
This quote exemplifies how an unconventional approach, like a pop-up shop during a significant event, can lead to unexpected viral success.
"And these are guys who were going out and obtaining kind of getting ridiculous conversion out of handing out flyers at a tube station."
This quote highlights the surprising success of the Dojo founders, who managed to get high conversion rates from a method typically seen as ineffective.
"And basically that is to me an admirable example of really creating something with very little, with no money and embracing kind of the true kind of culture of being a founder in the startup world of true grit and kind of versatility despite a lack of resources."
This quote emphasizes the importance of grit and resourcefulness in the startup culture, showcasing how founders can create success from very little.
"I think it's just a very realistic kind of perspective on the world today and where we might be very soon. And it's kind of terrifying, basically."
This quote explains why "The Circle" resonates with Fede, as it provides a realistic and somewhat alarming view of society's trajectory concerning technology.
"I mean, eventually over the next few years, I'm going to be spending, my plan over the next couple of years is to be in East Africa and southern Africa and indeed Western Africa at least two or three times a year and to really establish more of a presence there and to try and kind of become kind of a proficient investor in Africa within the London scene."
This quote outlines Fede's strategic plan to deepen his investment presence in various regions of Africa and become an influential investor there from the perspective of the London investment scene.
"There's something off the cuff and organic and the opposite of meticulously executing a predetermined plan. And I think that I wouldn't actually change anything."
This quote reflects Fede's satisfaction with the natural progression of Playfair's growth, valuing the organic nature over a strictly planned approach.
"Honestly, and I mean, it's not just a plug, but Dojo's newsletter is the funniest thing I read all week. It's fantastic. Their tone of voice and I mean, that's my absolute favorite."
This quote reveals Fede's personal preference for reading material, specifically highlighting Dojo's newsletter for its humor and tone.
"To be fair, I spend quite a lot of time on angel list because it gives me some interesting insights into foreign deals and who's around them, most importantly."
This quote indicates Fede's use of AngelList as a tool for gaining insights into the investment landscape, particularly for understanding the networks around foreign deals.
"The most recent investment we announced is Nitten. Nitten was a techstars company and we invested because the quality of their ip in terms of the code they've written to program these knitting machines and the absolutely massive global market that they can tap into and the closed nature of that market, basically."
This quote provides the rationale behind the investment in Nitten, focusing on the company's strong intellectual property and the potential to access a significant and exclusive market.
"And quite simply, I couldn't have done it without them. It would normally have taken me three or four days to go through that many cvs and I did it with Richard and Luke at hiring screen in just 15 minutes."
This quote acknowledges the efficiency and effectiveness of Hiring Screen in helping Harry Stebbings find a suitable assistant, saving him a considerable amount of time.