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Video interview with Elaine Coughlan, Partner Atlantic Bridge, Ireland. Elaine has over 15 years operational experience in technology companies with extensive merger and acquisition experience. She has been involved in three successful initial public offerings and two secondary offerings raising more than $1.6 billion in capital for various companies. She served as the CFO of semiconductor company Parthus Technologies plc (now CEVA Inc., a NASDAQ-listed company), from 1999 to 2003. Most recently she was a director and co-founder of GloNav, a GPS semiconductor portfolio company which was sold to NXP in January 2008 for $110 million. Elaine is also a mentor for Going for Growth, an Irish initiative for female entrepreneurs.
Transcript follows & video above.
- Which themes do you like to invest, what is your sweet spot?
We just do tech. In Europe we are rare enough in that the team is all from industry. We’re from semi conductors & software backgrounds, long careers. So you have people in the team that are serial entrepreneurs that have built a few companies. Executives, so CEO, CFO all types of roles. That’s not the common, it is in the US but it’s not in Europe the common approach where venture capital is typically drawn from the financial industry. We don’t like taking product risk so we like to move a little bit beyond the curb. We have done it & in our first one we’ve got a mix of mid & early stage. But we prefer to move beyond the seed & the first round & to I suppose the scaling type stage. But we’re not religious about, if you have an opportunity where you have a serial entrepreneur who has a fantastic record in a particular domain it can be of interest to us. In terms of technologies we may sometimes change but generally speaking mobile, wireless have been a big feature of what we have done both in our tech backgrounds & in our businesses. Mobile, wireless, cloud computing is such a huge part of the shift & trend. Security around that, security software, web infrastructure. It’s very difficult to know or back what’s the next facebook or Twitter so we probably focus a little bit more on the infrastructure that enables those businesses. Digital home, home networking, intranet everywhere, technologies like wifi direct which is both home & wireless play. So we accept the domains & we obviously keep them under review & they change sometimes. We then go out & try & find the companies in those domains. So we probably have 5 or 6 domains that are relatively broad. We stick to those & they’re areas that we have guys that have domain knowledge, expertise etc in. So we try to stick to what we know.
- What do you look for in women entrepreneurs & startups that indicate interest to you in investing in their businesses?
Well there’s not many of them, that’s the first problem. I don’t think there’s anything different in terms of what we look for between a woman entrepreneur or a guy. I think in general when you meet women entrepreneurs you find that they are incredibly energetic & focused about their business. That’s really critical. They probably have that in spades maybe a little bit more than some of the guys. Just purely because they’ve had to have that to evenget to the stage to spin something out, back something out, start something up. But genuinely I’ve been disappointed in terms of just the numbers coming through. They say never waste a crisis, I think the current recession particularly in Ireland & indeed across Europe will probably long term be a very good driver for women entrepreneurs. I think there’s probably better structures now & we can talk about some of those later on. But I think in general from an entrepreneur we look that they are very passionate about what they’re about to do or want to do. That they have fantastic knowledge, domain knowledge about the market, product, the competitors. Not just the technology, but how it actually fits into the ecosystem & how it’s going to compete. Then finally how they’re going to take it to market. A lot of entrepreneurs don’t actually think about (they might have great technology) but they haven’t quite worked out what the sales strategy, what the business plan is & how they’e actually going to get it into the market. I think they’re kind of personal attributes. You want them also to be keen listeners. I mean in the sense, open to taking in input. We’re not passive investors. Entrepreneurs aren’t passive people either. You back entrepreneurs, you don’t hire them! You hire CEOs, you don’t hire entrepreneurs. So we back teams, we back entrepreneurs & teams. That’s what we’re looking for first & foremost. Not easy to find the ones that are truly world class but you can find guys that can absolutely grow & scale & benefit from our mistakes, as previous entrepreneurs & founders. And our successes as well & you’re hoping to actually pass that on. To do that they’ve got to be open to it.
- What can women entrepreneurs/startups do to increase their chances in sourcing venture?
I think that’s a very good question. I think that women have got to be really much more confident in themselves & have much more belief in themselves. Be a little bit more ballsy & going out there & sourcing capital & be willing to get nos. Because the reality is you get a lot of nos in this business. Actually you don’t even get the nos, a lot of people don’t even tell you no. The good guys tell you no. I think women aren’t as good at getting out there & networking & being a little bit more forthright. It would never be said about us that we’re too backward in going forward, which we are. Typically you find women entrepreneurs are product experts so maybe they’ve been the code monkey, they’ve been the one that has built the product. They know the space well. Completely blind on sales, pushing, marketing, getting out there. I think those front of house skills, as I call them, as opposed to back of house skills. I think they must be much, much more confident in front of house. Take a chance. Guys are much more willing to give it a whirl. Let’s spin, let’s see what happens. Instead of quietly beavering away. They don’t really shine the light very brightly in terms of saying ‘Look how fabulous I am & look at what a fabulous product I have. So in selling ourselves I think we’ve just got to be much more confident & a little bit more outgoing. I don’t want to use the word aggressive but being much more proactive about pushing. Be open & be very aware that you’re going to suffer a lot of rejection. But you just need one to say yes! You can take thousands of nos if you get one yes. Also I think familiarity with the process. I think that’s fair. Women just aren’t familar with the vc process because quite frankly this generation of women entrepreneurs are standing on the shoulders of the previous generation of women. And there wasn’t many of them that were out there as entrepreneurs. So they’re really pioneers & cutting new ground. I think that’s where we have to look at the supports, the mentoring, to help give them the framework of this is what you need to expect. Because women are really fast learners. They don’t need to be told things twice. You don’t expect people to do it in a vacuum is the reality. It’s going to be difficult for them to do it in a vacuum. I think network. We’ve got to be much better at networking. Women should not have a bias now with networking with other women & other successful women. Other successful women always to the next generation of women, to put a hand down & pull them up. At all levels, both the women that have been successful in venture, in industry, in finance, we need to be much more cohesive as a group in trying to bring women entrepreneurs forward. The reality is that entrepreneurs need a lot of support in any event. But as a minority women entrepreneurs just need much more coaching, mentoring, support to understand the rules of the game as it were.
- That’s one of the reasons I’ve been doing these interviews. I think the other piece that happens in Europe, having lived in Ireland & the UK is that failure which is obviously part of the deal when you’re doing these sort of startups or ventures is culturally looked at differently than it would be say in the US. I’m wondering how you tackle that I guess with female entrepreneurs? Because women tend to want to really make sure that they succeed, that’s what I’ve heard from other vcs & women founders. That may be also where the numbers are falling down?
That’s a very good point. I think it’s very true. Failure is very difficult & there is a cultural aspect to this. If you look at the US its a badge of honor. Here it’s a bit of a badge of honor, believe it or not, I love for a guy to say we did this but we failed. I immediately think well you know what he’s gone off & bled on somebody else’s carpet. He knows now, he’s worth backing. So culturally it is an issue & genderwise I think you’re right, women always aspire to be top of the class. I think failure doesn’t come naturally to us. We’re not probably natural risk takers either. That’s the other part, that’s the corollary of that. So I think again I think it comes back to, to the extent that they’re in the world of tech, venture, finance, they’re going to see hey you know what a lot of other people fail. It’s a bit like the banks here in Ireland. I have to say they were run by guys & you know what girls we really can’t do any worse than them. They’ve made such a screw up of it. So women need to think like that.