Tunde Adekeye, VC Specialist

Hey everyone, welcome back to The Graduate Guide. Today we have Tomas Tunde Adekeye with us, who is an ex-VC. He has worked for plenty of VCs in the past and then went on to found Pitch Doctor. Welcome, Tunde. Hi. Hi, how are you doing?

Yeah, good. Lovely to be here.

Great.

Thank you for having me.

You're welcome. So let's start in like your early, early days when you were still at uni. What did you think your career was going to be like? Were you always interested in like VC or startups or—

Yeah, so, uh, I, I'll start just before uni because I think it's like slightly more helpful. So I, in sixth form, so yeah, when I was like 17, 18, thought I was going to become a lawyer, applied to all of like these law degrees. I ended up doing a law degree, but at the same time I actually applied for a bunch of scholarships, and I applied for one at an investment bank, may she rest in peace, Credit Suisse, and I got, I got onto it, which was like amazing, but what that meant was that The summers, kind of, so the summer before uni and the summer of first year, I basically had internships at bank and I got to tour like various parts of the bank, so market-facing side of the wall and then on the kind of private side of the wall. I preferred the private side of the wall and I preferred both sides to kind of law, which, you know, I would have ended up, you know, working for like Linklaters, etc., like most of my friends. And I just kind of decided like, okay, well, I've got this kind of investment banking track here, let's continue doing this, it's more interesting, you get to like learn about like businesses in a holistic sense. So I kind of did that. So like, I didn't really, it sounds bad, but I didn't really think that hard about careers at university, but that's because I kind of was already like in a career. And like, you know, I was pretty fortunate, it was quite a good one. So graduated and I started working in investment banking. I was in the TMT team. And, you know, then I kind of started to figure out, okay, what do I actually like? You know, you start doing it every day. Internships are really weird because they're kind of like a race or a sprint. And like, if you're very like achievement-oriented and a bit like Type A, like I was, you're just like, I want to win the internship and get the job, right? So I didn't really think, do I like this, etc., which is kind of mad. But, you know, full-time in investment banking, full-time in TMT, I gravitated like pretty heavily towards like the tech side. And on that kind of, and I think the reason why I graduated to the tech side is because the businesses were actually kind of growing. I'm not going to talk too much about financial modeling on this podcast, but like, you know, there were just, if you model a telecom business, one telecom business, you model all of them, they basically don't change. Whereas like the tech businesses, you get like a huge A new business model would be like payments, then you'd look at like an online marketplace, then you look at, I don't know, like a software as a service business. And it was all really kind of cool, and the businesses were more interesting, more diverse, and then they were growing as well. So I was like, you'd look in the numbers, you'd be like, Jesus Christ, 2,000% growth. And you go like, who's doing that? And like, when is that happening? Why do I get them after they've become boring? But you can look like 3 years in the past. And they're interesting. So that's kind of when I began to get like obsessed with startups, think about who's funding them, etc., and started looking like heavily at venture capital, heavily at like the startup world. I think the plan was always to go and work in VC. That was really, really hard. So I applied for a lot of VC jobs while I was in banking. I was like, you know, for like your classic, like, Type A banker, you think, yeah, you know, I'm an investment banker, of course I get interviews. Not the case in like getting VC interviews in 2016 to 2017. And so I started kind of, I got a bit confused and I started like researching, okay, what do the people who have like venture jobs in Europe, what have they done in the past at like the funds that one would want to work at? And I kind of looked at all of them. And I know like there's a stereotype that like, VCs are all like ex-bankers, ex-consultants. But if you actually like really look at like the profiles of like the funds you want to work at, most of them have hybrid experience. So most people have like worked in, I don't know, at a startup in some kind of team there. But they, and then a lot of them also have like a high finance background or like a management consulting background. I was like, well, I got half. And so I then started looking at like startup roles. So I was like following the tech news. About March 2018, a company raised a Series A, looked pretty interesting. It was in Berlin. They were doing like vertical farming. It's a company called Infarm. And I kind of, you know, did like a lot of research in like 24 hours. And I was like, cool, I'm going to try and create a job there. So like I cold emailed my then boss, Claire, and was like, you know, can I— like, you just raised money, I'm great, like, hire me. Yeah, hire me. And like, it worked. It was really crazy. It worked. And like, literally a month later, like, I end up moving to Berlin. And so that's how I end up in the world of startups. Did that for a year, year and a half. Worked a lot on raising the Series B, especially on the kind of like financial modeling side of things. Infarm was a very like operationally physical hardware intense business. So like investors were like always asking, can the unit economics work, etc.? Won't answer that question, but I like answered a lot of those questions. And then, and then so I raised the Series B, it was like $100 million from Atomico. And then I kind of started looking at getting into VC, and that's kind of how I got to like the VC side of things. I don't know if that was too long.

No, that's perfect. And like when you, I mean, you didn't go obviously into VC like straight after uni, but when you were at that point to kind of go into it, how did you pick like a right VC for you? Because they have all different philosophies, and just if you would be like a student applying for VC, what are some factors that you consider to look out for when making that decision?

Yeah, so I think like VC is probably one of the best jobs that you could ever do. Like, it is really fascinating, but it's only really good if you're at the right place. Like, it's actually— and there's a huge, like, not very different from, like, I don't know, law or banking, etc. It's not like a mature industry in the same way. Like, a lot of funds are younger and they're just kind of like, Often it sometimes seems like a group of friends who are trying a thing who happen to raise money. So there's like a massive disparity in like the structure and like quality of the fund. So I was pretty fortunate, like I worked at two, I think you would call them tier 1 funds, so LocalGlobe and Creandum. Those are the first two funds where I like entered VC. So I got a real taste of like what a fund which, you know, LPs, LPs are the people who invest in venture funds, kind of fall over themselves to like invest in. And that was like amazingly, like as an amazing experience, like a great learning experience. And then I joined Icebreaker with like a full kind of head of knowledge of like, okay, how this works, what good looks like. I think it's very easy to join, I won't name any funds, but it's very easy to join a fund because they give you a job and especially because the venture job market is so tight and it's not actually like that good of an experience. Things to like consider is like, are they going to let you invest? And then the other thing to consider is like how competitive, like do they compete really heavily with other funds for deals and do they win? Because like it's very common for people to be in like, I don't know, you call it a tier 2 or tier 3 fund who want to do all of the same deals as the tier 1 funds and they lose every single one. So you do all of this work, you write your memo, you put your bid in, you put in, you say you're going to pay $2 million, Tier 1 fund says they're going to pay $2 million, you lose every single time because like they'll always take Sequoia's money over yours. So you have to also think about like, can you win? And that will like really affect your career. And then you also have to think about what the partners at the fund are willing to let you do or not do. Some firms you really just have no autonomy, you just get given deals to like process and you're just kind of like an analytics monkey. In other funds, your job is just to find stuff and you kind of kick everything over. And then some funds have maybe like a more holistic thing. So I think you also have to think, what do you like? Like, is my fund positioned to win at all? The spoiler is most aren't positioned to win at all, which is why I like the returns of like bottom 2 quarter, bottom 3 quarter venture funds are terrible. And yeah, I think that's how I'd think about it.

And do you have a strategy to kind of find out what fund is like a valuable fund to work for, or is it more just like talking to people in the background? Or if you were to go into VC jobs again, what would your research look like?

Yeah, so I mean, newer funds are a risk, right? So if it's a fund 1 or fund 2, it's just a risk. Um, I would say like funds which are you know, more than 10 years old. Typically don't get to be more than 10 years old unless they've, like, delivered some returns at some point. So that's already, like, one, like, filter. I think look at the portfolios and look specifically to see if there are actually, like, winners in there. So companies which have very high valuation. So I'm talking, like, billion-dollar plus, like, actual outcomes. So, you know, if I were to go in the past and look at like Creandum, right? I mean, they did the Spotify deal, right? And that was apparent back in 2020 when I did the intern, or 2019 when I applied. And they did, you know, Small Giant Games, which took an $800 million exit. You can start to see like Klarna, Isetto, etc., were all in the portfolio back then. So you can kind of like take a venture fund's temperature quite easily. LocalGlobe, similarly, I think they had loads of interesting companies. Citymapper was in there. The founders were part of LoveFilm. There were a bunch of companies. I think they have like 15 unicorns or something right now, but you can actually begin to grok this stuff. I mean, if you were to look at Point Nine today, you would see like Revolut, you would see Did they do Pipedrive? I can't remember, but you'll see a lot of outcomes like that and you can kind of tell if you just spend like 10 minutes.

Yeah, I always think like, because I'm in so much in the startup world, I mostly interact with founders that like VC is obviously largely important to it, but just kind of something that I don't know as much about. So like in the effort to like demystify that a bit, what do you think like Um, because I think there's this perception of like, obviously, like, you raise funds for your startup and maybe that's kind of it. But can you explain, like, especially at UoBC, what's the relationship that you have with the companies that you invest in? Um, what does that look like?

Yeah. Um, so, so like, what's the relationship after investment?

Yeah.

Um, yeah, I've seen multiple models of it. I think though, typically especially at early stage VC. I can't really speak to like late stage VC, um, although I would say like late stage is often more hands-off because the companies can always do more themselves. They have more resources, they've got more money, they can hire people. Um, so the— I think one of the main things that VCs help with, pretty much every VC will help with, is like fundraising. So most companies that raise, you know, a seed round will have to go and raise a Series A later. VCs will definitely do their best to kind of tip the scale in favor of their companies, whether that's like— and the code in the most basic sense, it's like introductions to people who could potentially fund it. They kind of, you know, it's like a warm handshake. Some funds do more or less on that. So, you know, if you take First Round Capital, for instance, they have a thing called Pitch Assist, which is almost like a 2-week program, which they put all of their founders through to help them get much better at actually raising money. I think Entrepreneur First do a great job of this. And so those are on the extreme end of fundraising support. Most funds fall kind of bang in the middle. So it's more of an intro. They'll look at your deck, maybe they'll do a practice pitch with you, but they might not do 7 with you, and they might not help you make the materials. So you can expect that from fundraising support at some level from pretty much every fund. And then a lot of funds will try and like help strategically. So that may come in the form of like board meetings, which are maybe less frequent, or it may come in the form of like LocalGlobe did. I think they have check-ins every like 90 days, and then they're doing some like ad hoc stuff in the background. Icebreaker had like bi-weeklies with their startups, where like including me and that, you know, where you would kind of, the founders would kind of tell you what's going on and you kind of try and problem solve together, maybe leveraging experiences from other businesses that you've seen, other things that you've been part of to see if you can help in any way. And then some funds will help a lot with recruiting. So in fact, a lot of funds do help with recruiting. So it's like, okay, you need a head of sales, you need the CFO, etc. You've never recruited a CFO before, or a head of sales, or whatever. Most funds will have seen that process happen a bunch of times and will often even know people from former portfolio companies or parts of their former life, which they can be like, yeah, I actually know someone who's perfect for this stage, etc. So that's the type of support that VCs give, if they give it. Some funds don't give it. Like, I think if you spoke to like Hussein at Hoxton, I think he would— they have a much more streamlined support model. They kind of believe like that, you know, the best founders don't need them. Like, frankly, I have some sympathy for that view, but it's Yeah.

And what do you do if it doesn't go well, like as a VC? Like, have you ever been— yeah, have you ever been in the position where you realized, oh, I invested in like a very credible company and it's just going nowhere?

Um, yeah, it's always going wrong.

It's always going on.

Yeah, it's always going wrong. I think that's like— I think that's one of the first things you learn is like, like nothing kind of goes well. Like, it's like— and you might know, you'll know that probably to successfully interview a venture fund, you kind of have to internalize a bit of VC math. So roughly speaking, VC math dictates that like 80% of the companies are going to just evaporate at some point. They're not going to return even the money that you put in. So you do know that it's not going to go well, but it is very hard to see. And often, like, especially if you work a lot with the portfolio companies, which I have done, you're very kind of close to them. And so like seeing someone who's now become your friend, like struggle and fight and etc., is like a very humbling thing. I think I gained a real appreciation for how difficult founding a company is by doing it. But I think in general, because you're seeing the person who's really going through it, like it's not that bad for you, it's bad for them. But as obviously you, you kind of have a job, you have a portfolio of 9 other companies, um, your life isn't that hard. Um, in— I mean, yeah, it's not fun, like your partners start looking at you like you're an idiot, etc., etc., etc. But like it's part of the, the thing.

I want to ask from like the perspective of a founder as well, because, um, in the startup world I think you get like when you think about fundraising strategy, people throw sentences like, oh, VC is not for everyone, or even like more extreme opinions like, oh, don't raise from a VC, like you're just going to be a slave to like, yeah, the VC people. Um, what's your opinion on that? And also like, how do you assess like as a founder, um, whether like VC is for you and at what stage?

Yeah, okay, there's so many things to say about this. Um, So I generally agree that VC is not for everyone, for obvious reasons, that VCs are like, you know, at least as an asset class, VCs are hunting, whatever they call it, they're hunting unicorns, they're hunting massive outcomes, right? A lot of people start their business because they want to solve like a problem, right? And that problem may not be, you know, $100 million of revenue size, it just might not be. And so you probably, some people do start businesses to get, create $100 million of revenue a year, cut a billion-dollar company or something, but like most people don't. But I would caveat that the VC is not for everyone with the fact that like a lot of people really need money to start, and often the option set available to most people is extremely limited in terms of capital. So a lot of people end up defaulting to VC because VC is like the only thing which at least seems even vaguely accessible A bank isn't going to give you a loan. You can't normally do it on your credit cards. Not everyone has rich friends and family. So then in practice you end up with like VCs and angels. People default to VC because VCs are— they don't stop talking on Twitter. They're like literally just bleat incessantly. So that's one. And also like angels are much more invisible. Like, if you're like finding a list of 100 angels is much harder than finding a list of 100 VCs, although the angels are often far more likely to fund you, have far less strict requirements, and aren't all looking for like unicorns. So, um, and then that, that turns a bit into advice, right? Um, and so, you know, there's this kind of thing where it's like you should only raise VC if you have plans to make a billion-dollar company. And I think that's probably the correct moral advice, like if you're thinking about the deal between you and the investors, etc. The one thing which I think is missing from that is that if you're good, you can convince someone that you— because VC terms are actually not that strict, right? Most seed-stage deals, they're not going to get a majority, they're not going to be able to fire you, they're not going to be able to sack you, etc., etc., etc. You could, in theory, in theory, raise, let's say, €1 million from a VC and never raise again. Like, there's literally nothing stopping you. So, like, I think the advice where it's like the VCs will control your company is kind of— it's not really true. They can't most of the time. And so, and I've seen founders kind of do it. Where they've basically raised the money that they need and then kind of step off the VC path. I think morally that you should try. Like, if you're going to raise money and you're making a promise to, you know, this silly, stupid associate who made a bet on you, you're going to try and make a billion-dollar company, then probably the correct moral thing to do is to try. But I think like it's an oversimplification that the VCs will force you to like burn all of their money. They literally can't. You can feel pressure to do that, but that's you.

Because of the convincing aspect that you mentioned, like, I'm very curious if you feel that there's still a bit of a personality hype in the VC world, like that VCs like tend to also like invest in like strong personalities, or has that kind of gone a bit away after, you know, like—

No, it's— I think it's even more acute.

More acute.

It's more acute because I think people have like reverted to type. So when there was more capital, there were kind of more opportunities, or, you know, people were more willing to like risk. Or I think risk is a weird word in venture because I think people think a lot of things which are risky, um, so aren't risky for some certain reason. So like, you know, a founder who used to work at PayPal is extremely risky. Like, any startup is extremely risky, but like, in the VC head, like, that doesn't feel risky. Or like, a founder who's maybe bombastic and loud and, you know, has like a, you know, that kind of, you know, archetypical founder personality, it's still extremely risky. Like, 9 times out of 10, the business will fail. But it's not risky in like, it's not perceived as risky to VCs. And so they've reverted to type on that. And that's You already start to see that, like, you start to see that in the stats on like the amount of women, the percentage of women who get funded, the percentage of like Black founders who get funded, etc. Those have all kind of shrunk because essentially people have taken their money and they've gone, all right, I'm going to invest in the least risky of like the founder archetypes, in like that kind of loud bombastic founder who's like, or the founder who was employee number 7 at Stripe, etc., if we're only doing 10 investments this year and not 20, it all goes to them.

How, like, especially as a Black man, like, how do you view diversity in VCs? Like, is there a push to kind of at least in some VCs try to invest in more minority, um, founders, or, um, is it more like becoming less relevant?

I don't think they really care. Like, I, I'd be honest, like, I think, I mean, so some people do care Like some people do care, but I think, I don't think, I mean, I wrote an article about this recently. I don't think they really care in like a structural sense, right? So there's a bunch of problems. So there's one that's kind of like whatever you call it, unconscious bias, right? So at the end of the day, pre-seed, seed, whatever, early stage investing, there is such little data, it's an unbelievably risky thing to do. So then you're essentially judging stuff on vibes, like, you know, and the vibes are kind of informed by facts. So if you tell people that you were the person who invented the wheel, then people will be impressed by that, right? But then, you know, and you went to Stanford, that had 10 points, and you Were employees having at Facebook, add 10 points. And you had $7 million worth of sales, add 10 points, right? So there's kind of like the facts will influence the vibes. And then there'll be kind of like softer things where like people are pattern matching, which, you know, tacitly means, do you look like in my gut, like someone who can make a million-dollar company or billion-dollar company? And unfortunately, I don't think that many VCs automatically see Black people and women as that. So then you kind of have to overcome like the negative pattern. And so, and I think that's really hard to, it's really hard to fix. And then even if you take the funds who do want to fix it, they have another problem. This is like what one of my last articles is about, which is like, okay, Say you're a fund and you go, actually, Marlene, is it Marlene or Marlene?

Oh, it's fine.

Marlene.

Yeah. Okay.

Yeah. So Marlene is like, you know, is amazing, is perfect, etc. I'm a seed fund. She needs $2 million. We're going to give her $2 million. But in 24 months, she's going to need $5 million from some Series A fund. And you're looking at all of these Series A funds and you're going, none of them have funded a woman in in the last 5 years, right? So how does this continue, right? Even if everything works, Marlene is going to have a harder time fundraising. So not only do— so for a fund that wants to be like diverse, and I was speaking to one of the founders of a fund which is focused on diverse founders, and they were saying like, look, we have all of these companies And like, it's a year later, they're doing great. And we just know that they have a much— we are literally seeing that they're having a much harder time fundraising than they should have. And that person's worked at funds which were not— which were without a diversity focus. So they were telling me like, how do I, you know, how do I square the circle? How do I like fund these businesses? And how do they still have a chance? When they come up again with like fundraising requirements in, in a year. So it's loads of pervasive problems. Sorry, it wasn't very encouraging.

Very like a very complex world. But maybe to focus on something more positive, which is like pitching, which you mainly focus on, especially like kind of not leaving the VC world but doing your own thing with Pitch Doctor. How, how did that come about? I assume it was like your passion, maybe pitching, or you found that most interesting? Can you describe that?

Yeah, I think the— so that came about because, like, we were talking a bit about fundraising support, and maybe about 20-30% of my time while I was at Icebreaker, which is the fund I was at after Local Globe and Crandon, it was a pre-seed fund, was like helping support founders, basically helping tip the scale so that founders could go out and pitch, you know, people that I used to work for and others, and like have a good chance of winning. And in essence, like, I realized that, okay, there's a decent amount of material on like, how do you make a deck? Like Google pitch deck, there's like 70 pitch deck templates and you know, there's some material on how to make a blurb, although I have the best blog post, but like, I just wrote one. But yeah, like, please read it. But like, there's a lot of material on like how to make a blurb, there's a lot of material on this stuff, but there is absolutely nothing which actually kind of shows you the inside of a pitch meeting. So most founders who've ever pitched anyone— so most founders, they go into their first pitch never having anyone see, never having ever seen anyone pitch another VC. Like, it's like an invisible thing. And so, like, how can you be expected to be good at something that you've literally never seen before? And so, and I kind of noticed this with our portfolio founders, is they would, if they prepare, they'd have great numbers, whatever. That's why we would even, like, say, okay, it's time to fundraise now. And they do the first practice pitch of you, and you go, like, this is so normatively bad. And then when you see And like another thing I noticed was that, you know, people who used to be VCs who went fundraising just raised money so quickly. And it wasn't just that they were like raising money from their friends. They were just like really good at raising money because they've seen 1,000 pitches. So they know what good looks like. Whereas most founders, even like the best ones, don't have a clue what good looks like. And so what they do is they go in, they burn meetings 1 to 15. Just being bad at pitching and like kind of trying to learn. No one gives them feedback because VCs do not give objective feedback, basically because they get shouted at. There's no benefit to them. And as a result, you know, people's fundraisers blow up. And so the kind of idea was like, okay, if you can take pitches and kind of provide like match analysis and let other people in and let people see, okay, like, by no means should I answer a question in this way, or answering questions in this way with this type of style, with this type of approach is really helpful, or spending 25 minutes talking and not letting— like I'm doing now— spending 25 minutes talking and not letting the other person ask questions is a terrible idea, etc., then you can begin to like, then you can actually start to win. And so that when you go to your first meeting, you actually are, like, have a good chance of delivering something that's normatively good.

What makes a good pitch in your opinion?

Really hard question. I think clarity is, like, unbelievably key. So there's, like, clarity, and so I think a lot of the clarity, lack of clarity, comes in kind of two ways. So there's, like, jargon. So a lot of companies are pretty technical, well, they're doing technical things, and then you start talking about, you know, I don't know, some kind of deep digestive process which is in your software to an audience which doesn't know what that is, so it means nothing to them. Or like, lack of clarity can be in the complete other side where it's like, not specific at all. So it's just so vague as to be meaningless. There's a lot of marketing speeches, a lot of marketing speech in pitches, so people might say something like, you know, we're revolutionizing the world of finance. Great, doesn't mean anything. Like, I don't know what I'm investing in. So there's like a clarity piece, there's like knowing your audience, knowing what your audience is really looking for. So VCs are looking for amazing teams, and most people really, like, you, it's 60% of pitches I see, they barely mention their team. And it's like, well, I'm investing in you, it's a seed deal. There's There's like market sizing. I think that's a thing that founders really underappreciate, where it's like people actually need to believe that there are like, that there is a billion-dollar outcome in there, because no matter how much they believe that it will work, if they believe it will work and it won't be big enough, no investment. So people either underemphasize, don't do the market size, or it's completely unconvincing. They just like take a random number from a report and which no one believes anyway, so you may as well not have one. And then the last thing is, like, often products— startups are framed around this kind of problem-solution type thing. So you start like, we identified this problem, it's really bad, so we made a thing to fix it. A lot of the time the problems don't feel painful, or even if they do feel painful, like, you know, so a problem might be like climate change is bad. So yeah, okay, I agree, but the problem lacks any kind of detail or any kind of like evidence in there or focus on like why the customer, whoever is going to buy your product, will buy your product, or like is it experiencing pain. So there's a lot of painless problems where I'm like, okay, yeah, great, this is a problem, but no one is going to like lift a finger to pay any money to do that. So I would kind of put it there. I know it's like not the most succinct answer.

Nice, good. And like obviously looking back that you're now doing what you're doing, how has your like definition of like success in startup world like for yourself changed like since you were at Credit Suisse?

I think my definition of Success. So I mean, when I started my pitch, Doctor, I never— I didn't want— I don't want to— at least I'm not planning to build like a VC-scale business. It's just a problem that I want to solve. That's like the only motivation. I don't need to build a unicorn. I don't necessarily want to build a unicorn. It'd be nice, but like one day. Yeah, it'd be nice, but that's not like what I'm aiming to do right now. So I think I already had like a different definition from success than what you might expect from like someone who spent 3, 4 years in a venture fund. Yeah, I don't know if that's a good— I don't know if that's comprehensible, but that's how I kind of think about success. I just want to like make something which makes people happy and fixes a problem which is really annoying. And I think the problem is kind of like, okay, underrepresented or whatever, any founder, but like especially like the underrepresented or the ones who aren't even within the VC orbit. Like they have good businesses, like there's loads of good businesses there. They have to go fundraising at some point, and already the chips are stacked against them because they don't have the warm intros. They don't have the warm intros. A lot of them don't look like they're from like central VC casting. Then on top of that, like they're expected to just suddenly be able to like pitch, right, like magically, and it's kind of stupid. And so I just wanted to kind of create transparency there so that people could at least, like, you know, if you wanted to, yeah, at least see what a good pitch looks like.

Yeah, I think that's very inspiring, like a passion that you have in solving an actual problem. Great. Okay, thank you for coming, it was great having you. And yeah.