Flickr CC: Paula Marttila

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In the midst of the hottest July my Inbox was greeted with an invitation to join a panel to discuss seed stage funding at European Pirate Summit in Cologne, Germany. It was one those things that sounded just bit too crazy enough project not to be part of (read: outdoor “art wasteland” venue close to a highly trafficked railway), and the energy and excitement by the organizers was contagious. Besides, whatever it is Philipp Moehring is cooking, it has to be good. Philipp gets things done on the European startups scene, paying attention to details and making sure not just startups are growing – there’s always time for the Seedcamp office plants.

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How To Get The Most Out Of Your Seed Investors – Intros, Connections And Ze Moneyz

With surprisingly few goods trains passing during our panelPhilippChristian Thaler Wolski of Wellington Partners, Florian Meissner of EyeEm, and myself, unpacked few insights on seed funding. Given that each of us represent different roles in the startup ecosystem, the experiences and advice shared were immensely consistent, summed up below.

Value Beyond The Check

Besides from that your seed investors should stay out of the way and not wear you down with excessive reporting or board meetings, most value should come from:

  • Help your team to focus, not add to the priority list.
  • Help in hiring. The early hires are the most important ones.
  • Help with connections and next funding round.

How To Get Funded – Quickly 

A.k.a the great funding stories, such as offering an investor a ride to the airport and returning home with a check. We all agreed on, that while those stories make great headlines, they also are an exception.

If there’s ever an easy way to get funded, it’s most likely when you already have created a relationship.

Create relationships, keep in touch and update the people you want to work with, partner with, or get funded by.

Christian confirmed that being often the case with companies Wellington invests in. Yes, investors are people, too, and people invest in, work with, and trust in people, not the business idea or market opportunity alone. At such early stage most business ideas end up pivoting regarding target markets, business models, pricing etc. When that happens, as an investor, you want to make sure you have a team that can handle and execute through those pivots.

Nikolaj Nyholm of Sunstone Capital made valid point adding, that while it’s good to stay in touch, updates are most valuable when you actually are making progress. Deliver on your road map. What really gets you in great position, is when you exceed expectations, i.e. nothing wrong with over delivering 🙂

My advice: Keep the updates short and to the point. A friendly, personal update. That is all.

Few of my favourite quotes on creating relationships:

Warning Signs

Investors, advisors, or mentors who start their advice with “You must…” are most likely to do more damage than help your startup. This is why you should date before getting into bed with anyone, whether it’s an investor, or advisor, you’re looking for. Whatever you are being told, it’s your company. Listen and digest. Recognize patterns on the feedback and make your own decisions.

The good investors don’t wear their investor hat when mentoring or advising. You shouldn’t feel you have to take advice just because it comes from an investor. Read more great advice on mentor and advisor relationships from TechStars Boston. Lastly, should your startup be on AngelList? YES!

Scrappy Backyard Making Founders and $$$ To Connect, As People

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European Pirate Summit may have declared a war against clones and copycats, shared great war stories, (Morten Lund surprised everyone by taking the stage), had practical hands on sessions, but most importantly, it put both startups and venture capital on stage to pitch each other, also giving everyone a lesson on why it’s crucial to meet and talk as person to person. As brought up in the panel earlier, creating relationships is huge part of building great business. Spending a whole day together on a scrappy, chilly backyard helps to start connecting.

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Reverse pitching elegance by Christian Thaler Wolski of Wellington Partners

Reverse pitching fashion by Martin Mignot of Index Ventures

And yet, no words can really do justice to the European Pirate Summit backyard extravaganza, you have to see it for yourself: videos by great narrator pirates Mike Butcher and Martin BryantNatasha Starkell of Goal Europe took lots of pictures.

They even had delicious custom made pirate chocolates. I surrendered.

Advance Conference With Startup Founder Leaks

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Cologne was not only invaded by startup pirates, but had gathered full house of web and startup people attending Advance Conference. I missed Morten Lund delivering on stage, but got instead to witness Mike Butcher of TechCrunch Europe grilling nine venture capitalists. The entire event with high appraisal was best captured by Niko Waesche of German Media Pool.

The Founders: Words of Wisdom Leaked From Tine and Max

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My good friend and savvy entrepreneur Tine Thygesen of Everplaces shared together with Max Niederhofer of Qwerly their learnings on building and running startups at “ask anything” session Founder Leaks. Here’re the goodies:

Finding Your Competitive Advantage

  • “Stick with what you know – what can you do that others can’t?.” Tine
  • “Find opportunities where others don’t even care to look.”: Tine

E.g. 23 Video broke into the Portuguese video service market because no one else was bothered to translate their services into Portuguese. (Tine is ex CEO of 23 Video)

On Hiring and Building Great Teams

As you’ve most likely heard before, it’s true: The first hires are the most important ones.

  • “What do you really need and who do you really like to have in your team?”
  • “Don’t underestimate the importance of cultural fit.”
  • “Rather hire an engineer with business sense than the other way around.”: Max

On what kind of people they look for:

  • “The more contradicted I get, the better.”: Tine
  • “Someone who takes my job away.”: Max

On Building Product

  • Start talking to your customers before writing one line of code!”: Max
  • “You must have technical co-founder and keep technical core product development in house.”: Max

This is my most repeated advice to startups. Qwerly lost 6 months of coding by first outsourcing the development of core product.

  • “UI / UX people know how to make things pretty, but too often that doesn’t bridge to business”: Max

My point: One has to have deep understanding of the product and what makes it valuable to a user. There’s actually almost nothing worse than having advertising creatives build consumer web products. Products and services that people are meant to use and enjoy, repeatedly, not some savvy campaigns.

“No one builds Silicon Valley, get on with building great startups!”: Tine

Ps. 1: If you are building for the social web, I strongly recommend to check out Qwerly API.

Ps. 2: If you’re yet to find a way to save your favourite places, Everplaces is soon out of private beta. Ask for invite.

Cheers To Cologne and Pirate Summit, You Did Well!

Paula is Digital Product Advisor and Top 100 Women in Tech in Europe, focusing on Product, Go-to-market, and Internationalization strategies. Rated as one of the very best startup mentors in Europe, she has to date mentored over 150 digital technology companies on product, marketing and growth. Pick My Brain! is her fixed price service tailored to early stage startups, gender wage gap adjusted for female founders. Contact Paula for digital strategy work or book her as keynote speaker about #Startups #WomenInTech #GenderEquality #Entrepreneurship. Read more about her work and connect @Twitter, @LinkedIn. “You never learn anything when you speak, only when you listen”Roelof Botha / Douglas Leone, Sequoia Capital

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