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Episode
107

Jasiel Martin-Odoom

Senior Investment Associate at Unreasonable

Ep
107

Accelerating Impact Through Inclusivity In Access To Capital

Apr 19, 2022
With
Jasiel Martin-Odoom
51:25

Accelerating Impact Through Inclusivity In Access To Capital

Reasonable items seldom change anything. This is why the aim of the Unreasonable Group, a private equity firm, is to re-purpose capitalism and support impact-driven entrepreneurs and companies who are trying to solve major global problems.

To date, the Unreasonable Collective has over 300 ventures in more than 180 countries, and these ventures have collectively made more than $7 billion in revenue, nearly $9 million in financing, and are making a difference in the lives of 800 million people across the world.

Impact Hustlers speaks to a lot of founders, but today, it’s time to hear what it’s like from the other side of the field. Jasiel Martin Odoom, Senior Investment Associate at the Unreasonable Group, joins us to share some insights on what it’s like partnering with impactful companies led by underrepresented or minority founders and raising funds.

In this episode, Jasiel gives great advice and nuggets of wisdom for aspiring or early stage founders on how to pitch, how to select investors, how to raise funding, and so much more. We were even joined by a former guest on Impact Hustlers, Joel Tasche, the founder of Clean Hub! Again, you won’t want to miss this episode.

Jasiel’s key lessons and quotes from this episode were:

  • “If you can tell a very clear value proposition within the pitch deck you're sharing with the investors is always helpful.” (11:40)
  • “You have to explain why your solution is better than anybody else in basic terms, but being able to craft a story around that thing often helps as well.” (17:34)
  • “As you're starting out, the feeling might be to rush for the first VC to validate your product… but it's less about the money and more of what you're building. Especially as a founder, you're looking to build something that lasts, so think it through.” (23:33)
  • “We should include diversity in this space and diversity of the team, who is in the team. That should be a metric for us to go out and find companies, because we will find that it will force us to source in different places.” (35:22)
  • “Always start to fundraise before you need to close a round.” (45:43)

In this episode, we also talked about:

  • The type of companies the Unreasonable Group invests in (6:56)
  • Do’s and don’ts when it comes to raising (11:16)
  • The key to choosing investors (21:42)
  • Pitching and helping investors understand a niche industry (37:56)
  • Joel’s top tips on the overall fundraising process (45:25)

Transcript of the episode

Maiko Schaffrath  00:00

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You are listening to Impact Hustlers, and I am your host, Maiko Schaffrath. I have made it my mission to inspire the next generation of entrepreneurs to solve some of the world's biggest social and environmental problems.

And for this reason, I am speaking to some of the best entrepreneurs out there who are solving problems such as food waste, climate change, poverty, and homelessness. My goal is that Impact Hustlers will inspire you, either by starting an impact business yourself, by joining the team of one, or by taking a small step, whatever that may be, towards being part of the solution to the world's biggest problems.

In today's episode, I speak to Jasiel Martin Odoom, investor at Unreasonable group. After a career as an investment banker at Goldman Sachs, Jasiel transitioned towards social impact and has been an impact investor since 2020.

He is responsible for deal flow for the Unreasonable Collective, and we'll speak about what that exactly is and how you can benefit from the Unreasonable Collective as an entrepreneur, which is a group of diverse leaders and entrepreneurs investing in impact-driven startups.

He has a deep passion for supporting underestimated founders who are solving the world's biggest social and environmental problems, and it's great to have you on the show to share some advice with founders from the Impact Hustlers community and with the audience of the podcast. So excited to have you. Thanks for joining, Jasiel.

Jasiel Martin Odoom  02:01

Thanks, Maiko. Thanks for having me. I'm super excited to be here today.

Maiko Schaffrath  02:59

Amazing. Thanks for your time. So, let's start with giving people a bit of a background of yourself. What's been your journey? You spent quite a bit of time as an investment banker, but what has been the transition from that into VC or just the story of wanting to be a VC investor and wanting to invest in impact, even start earlier than that? Tell us how you got here.

Jasiel Martin Odoom  03:26

Yeah, it's a great question, Maiko. For anybody who's listening, I was born and raised in Ghana. I moved to the US for college and did my Master's at NYU in social impact, investment, and innovation.

It was at that point where I got to be part of the student investment managers NYU's Inaugural Impact Investment Fund, which is a two-year course I was taking, and that's kind of what got me on the course of thinking about how to formulate this concept of leveraging capital and drive it to founders who are trying to change the world. 

After grad school, I made a decision to take a job with a [inaudible 4:02] bank in London, in the industry M&A group. I sat in this investment M&A group for a few years covering Global Business Services and European building and construction businesses. However, for me, the ultimate goal had always been to get back to work directing capital into early and growth stage ventures.

So, after a few years, I'd go and said I made that transition in making a conscious effort to meet in the impact space. I joined Unreasonable group as a portfolio manager for UK & EMEA, and that's what began my transition into now working on Collective as the senior investments associate where I am responsible for sourcing, due diligence, and executing deals.

Maiko Schaffrath  04:50

Perfect. We'll speak about the Collective in a second, but first of all, can you give us a bit of a background of Unreasonable group?

Before we do that, actually for anybody that wants to listen in more detail and what Unreasonable does, we actually do have a podcast episode at Impact Hustlers with Daniel Epstein, the founder, so you may want to check back to that as well. But in your words, Jasiel, what is Unreasonable do? How do you operate as a bigger group of company?

Jasiel Martin Odoom  05:17

Absolutely. Maiko, you're right. Daniel definitely does a way better job explaining what we do in Unreasonable, but I think, for me, I like to think of us as impact accelerators.

We partner with corporate partners like Barclays, Accenture to develop impactful programs across certain themes. And through that programming, various companies, growth stage companies that are oftentimes the most diverse courts of people focused on solving all the world's biggest problems like climate, feeding security, education, the future of work. 

And so, what we do, post that involvement in our program, they get inducted into our portfolio companies, and that's what my former role came in where I supported ventures with both fundraise support so thinking through how to connect them to capital as they are going through their fundraising rounds.

And then, equally, it's important thinking to how to support them operationally, thinking, "Can I get them mentors?," to people who could help expand the impact further. For me, I like to think of Unreasonable as an ecosystem creator, trying to create an ecosystem that can support our portfolio of companies' impact and help them scale further and faster.

Maiko Schaffrath  06:33

And the companies you support are pretty much global, isn't it? I think Unreasonable is based- 

Jasiel Martin Odoom  06:39

Absolutely. 

Maiko Schaffrath  06:39

Mainly in the US and in London, there's a few people. You're usually based in Ghana, as far as I know, right? But also-

Jasiel Martin Odoom  06:46

Yes. 

Maiko Schaffrath  06:46

Coming in and out of London. So, [are] there any restrictions to the type of companies you're investing in as Unreasonable?

Jasiel Martin Odoom  06:56

For sure, for sure. So, it's a bit different. As part of our work in the Unreasonable group as a whole in the accelerator program, we have a very talented global venture selection team. For Unreasonable's portfolio companies, you cannot apply to be a part of it.

Our venture selection team are very good about looking for the best companies that are focused on the different impact themes that we are covering at a time. How is that? Because part of all this work in trying to build an ecosystem support around entrepreneurs, we spun out a year ago our pledge fund called Unreasonable Collective. 

Unreasonable Collective is a network-powered VC that gathers like-minded LPs who are focused on channeling not just capital but also support to growth stage entrepreneurs. We're looking at companies from the pre-series A to about the series B stages, broadly covering climates, built environments for both HR stations and treated agriculture. 

And then, what is, I think, our secret sauce is that not only are we looking to direct capital into these companies as minority investors but even more importantly, because of our member base of individual LPs, be able to create modular engagement with our LP base where we show that the different needs of our portfolio companies identify every opportunity to expand this Unreasonable hypothesis which is that we create an ecosystem of support around companies that are looking to do good and do well, and they'll be able to expand their impact. That's what we offer within our Collective investment group.

Maiko Schaffrath  08:26

And then, the Collective, the name already shows that that is actually quite a group of angel investors, of entrepreneurs, of leaders. Who are these people that are backing the Collective and investing with you into impact-driven companies?

Jasiel Martin Odoom  08:45

Yeah, for sure. I mean, we have quite a broad range of people, everywhere from high net worth individuals to influencers. Our IC is chaired by some very well-known names in the investment space. Our Board Chairman for Unreasonable, Christiana Musk, is on our Investment Committee.

We have quite a broad range of about 150+ ex-operators, ex-fund managers, serial entrepreneurs, really, a broad range of people who can both channel support across very disparate places to support our portfolio company.

Maiko Schaffrath  09:21

Got it. Exciting. And as I understand it, The Unreasonable Collective is a bit more open to startups actually applying for investment, is that right? How does it work? How do startups get in the funnel?

Jasiel Martin Odoom  09:35

Absolutely. We are always looking to meet exciting companies that are looking to raise capital within that. As I always tell folks, I can share and Maiko can put it in the description after this. Always shoot me an email. My email is always open. It's a pretty great way as well to reach out to me. I have a Twitter as well.

You can reach me on Twitter. We're always open, just looking at companies and checking out which companies make sense for us. In terms of area that we focus on, we're pretty focused on the pre-Series A to about Series B.

We only follow on so we have to be a lead investor in the round already, and we focus broadly on climate, both environment, but we will transition through to that.

Maiko Schaffrath  10:22

Amazing, great. Cool. That's a really good introduction. I've already shared your email. Thanks for being that kind, and I'll put it in the show notes as well for anybody that's looking to get in touch with you. So, let's move on a bit towards some lessons learned from the investor perspective. You've been doing this for a while. 

You're seeing, I assume, hundreds of startups regularly, reviewing pitch decks all the time, so you'll have quite a few insights on what good looks like and what you're looking for, obviously, as well.

Maybe let's first start with things that you see startups do when they pitch to you that you would suggest they avoid. What [are] the worst things that you see sometimes, mistakes they make, easy things that could be fixed to make a much better impression and to increase the likelihood of raising? Is there any advice around that?

Jasiel Martin Odoom  11:19

Yes, for sure. There's a larger conversation that we have to have around this space like, who gets to show deals to people? It's why we don't only depend on referral deals. We're open. Like I said, we're open [inaudible 11:36].

I think what normally helps too, I think what I've seen that is often helpful is if you can tell a very clear value proposition within the pitch deck you're sharing with the investors is always helpful. 

If I can tell like what the problem is and how you're solving this, specifically, it's very helpful, because I get pitch decks and then I read the whole thing, and I have no clue what this company does, and there's a lot of really great- market sizing, which is all very important, but it's also very much like, what exactly is the problem that you solve, I think, is one.

I think for the Impact Hustlers community as well, a lot of times, I see pitch decks that come in with the impact page in maybe one page of the deck. 

But a lot of times, I find that companies that have intertwined both impact and their business into the pitch deck as a whole have very [inaudible 12:23] about their business on a very holistic level.

And so, I like to see that as well, especially looking for clients who focus on companies that solve some of the world's biggest problems. If it's clear, that impact [inaudible 12:33], but it's actually a part of the way you're doing business. That's always very good to see as well. 

Oh, man, I think for me, because we invest pre-Series A to about Series B, we like some traction, and we don't have a hard and fast number like a million. But I think for me, if you were to build something, there's a lot of really great incubated pre-Series B fund investors that are available to help support and you can think to your concept and really get some product market fit.

It's where we sit in the pre-Series A, Series B space where we look at companies that have some amount of revenue on the books and have a clear plan towards hitting about a million dollars ARR in the next couple of years. 

For us to be able to see that there's a plan in place, some traction on the ground is always very helpful, because it can help you contextualize how to place the opportunity within your portfolio.

Finally, a lot of times, I wish more people showed a clear understanding of who their competitive landscape are, because I think a lot of times, people have sent me a pitch deck. It's one page of like, "We're the best of this category."

That's a very easy thing to massage it with metrics you look at. So, to be able to have a better comparison, as I say, I've thought about this. This is why we sell this unique space. 

I think it's a lot of foresight for a fund like ours, where we're only checking to make $500,000-$2 million, so we have to be very clear on what deals we do, and we do a deal every four or five weeks. We see a lot of pitching. You have a very short time. To be able to tell how this company sits in a competitive landscape, oftentimes, will give us some more comfort to have a second conversation.

Maiko Schaffrath  14:17

That's a really good point, I think. Really, it's a bit of running gag looking at these competitor slides sometimes in startup pitch decks, and obviously, the startup is always in the upper right corner and doing everything better than everybody else.

But I think what you said there of extracting, being honest and being like, "Maybe this is where we have a risk or a weakness or where we're not as good at this company, but it's how we're addressing it," or, "This is why we're not focusing on this but on something else," that gives a true honest picture of your company rather than something that looks like, "Okay, you're saying you're the best and everything, but you're definitely not, so what's your focus and why are you focusing on that?" Is that a good summary of it?

Jasiel Martin Odoom  15:03

Exactly. Yeah, exactly right, and I think also, especially for me and my specific focus on supporting underrepresented founders, sometimes, some of these things may be a yellow flag, but more than often, we'd have a conversation if it's within our strike zone generally, because sometimes also, I've had pitch decks that have been like, "We're in our strike zone," but hadn't been too clear on the competitive landscape after a conversation about, "Okay, this makes a lot of sense," and that's a good reason why we should think this through. 

For me, also as an investor, I also keep my investment hat on to think about something that can get lost in translation. We're a small team. There's only four of us on my team, so we don't have a lot of bandwidth to be able to [inaudible 15:57] and understand what is interesting and get clarity really, really quickly is important for us.

That helps us do that. That's super helpful. In an area where we already have comfort within the area, for example, we've done some prior work on the industry and the trend, so we're comfortable in that space. Now, it comes into, how do we place a startup in this ecosystem that we are comfortable in?

Maiko Schaffrath  16:22

Got it. Absolutely. And then, if you look at the startups that you have invested in, is there something that they have in common that they've done particularly well when they pitched for investment? Is there anything that is a common good practice that founders can adopt?

Jasiel Martin Odoom  16:41

Absolutely, yeah. I think the number one thing is clarity. I've been assigned in pitch deck meetings where it's more like an hour. And then, it's going on and the founder hasn't really crafted a story.

I was reading something yesterday that was saying that most owners need to have a story. I think that's probably the biggest thing that when someone's pitching to me, to be able to have- building in the time we have, explained their value prop, explained how they're solving it, why they're the best idea, and why we should invest given even what might be their risks in the market,

I think that's super important and very clear to where you can tell some founder who has taken the time to practice their pitch, to understand their problem, who is clear on it. Because sometimes, the problem might be super technical. Let's say we're talking about lithium ion batteries, for example, maybe super technical. 

You have to explain why your solution is better than anybody else in basic terms, but being able to craft a story around that thing often helps as well, because I will do my own due diligence and understand the technical part of the company, for sure, and I want to get comfortable that the founder has the technical know-how, but I also want to understand the story.

Because eventually, what we'll be investing in is that business model, sure, is the business plan, sure, but I'm really investing in the founder. I'm investing in like, if this doesn't pan out, do we think this person [inaudible 18:06], because we do early stage stuff, so there's still a bit of risk for us. It's very important getting the metrics right and then the valuation, all that fun stuff, but if it is clear on what they are offering and how they can get there is often one of the big things for me personally.

Maiko Schaffrath  18:24

Got it. I think another thing that I see, it's always great if a pitch deck is really created in a way that it's really a trailer to a movie rather than the whole movie. I've seen so many decks that try to cover everything and all the details and everything, and the message gets lost, the story gets lost. It's confusing what you're actually even doing. 

You may try to include everything you're doing, but the job of the initial deck, anybody that's now after this podcast reaching out to you or sending you an email, the job is to capture your attention and to get you excited to have a meeting or to take the next step, whatever the investment process is, and move on rather than wire a check straight away after sending the deck. Would you agree with that as well?

Jasiel Martin Odoom  19:09

Yeah, for sure, for sure, because right now, and I was listening to your podcast, one thing that gets is that capital is a commodity. Getting the money into a startup is quite easy these days. The conversation I think founders should be thinking about is like, "Why am I pitching this story to this investor? Why is this person important for us?" 

For example, the Collective, our unique value proposition is that we can connect you to not only 150+ members who are investing in your company directly, but into the larger and reasonable network of about a 250-portfolio company with 500 investment boards, to hundreds of mentors and network, so our value prop is we will connect you to so many resources to unlock different aspects of your business and to help you scale up your business and the issues you're trying to solve and so forth. 

As an investor, I often tell founders that it's a great conversation, "Yes, I need money XYZ," but capital is commoditized. I think founders get to be able to take a second and think, "Why am I telling this story to this investor, and how do they fit into the long-term plan of my product?"

Especially goes out to impact companies. You're looking to fix a problem in a sustainable way that's affecting people's lives, and to be able to start to think about the long term and the beginning as a founder, I think, is super necessary. A lot of people have written really great things about why founders should be more active in their investor selection. I think that's definitely one of the most important as well.

Maiko Schaffrath  20:45

Yeah, and right now, it's the best time. There [are] new funds starting all the time. Everybody wants to deploy capital. So, as much as maybe the macroeconomic situation is getting tougher and tougher, still, there's so much capital for founders.

Do you think there's any framework or advice you would give to founders on how they should think about selecting the right funds? Obviously, if you're just starting out, and you're raising funding initially in a position of like, "Oh, god, I have zero raised. I just need to take any money in," but I'm sure the best startups out there, they act a bit differently. They're much more strategic on which investors they select. 

Is there any framework, any key things that founders should think about when selecting investors? And who should they approach first, straight to the investor that's their dream investor? How should they go about their fundraising?

Jasiel Martin Odoom  21:42

Absolutely, absolutely. That's a really good question. I think the number one thing is, wherever you are, if you're in pre-seed, you're in the idea stage, or if you're a Series A, wherever you are, I think it's always important to think about the story of the other company.

I keep bring back the story, because really, it would impact who you're thinking about getting, reaching out to. As an example, if your company's idea is a story that is looking to solve a problem in a very practical way, but you don't think it's a [inaudible 22:10] VC story, it doesn't mean you can't get it funded. 

There [are] many other opportunities so you can get it funded. Whereas if you have a story that's a more VC story, you probably don't want to be talking to family foundations really early, because then, your capital will have a lot of family relations and people who may not have the skills to help you scale up. In the beginning, thinking about what this business is, and it doesn't have to stay static.

It might change, but having some sort of North Star is always helpful. I think the second, as you're raising, there's looking beyond equity capital. I get so many people who come to me, send me a pitch deck, they have an MVP, maybe an idea and are like, "I want $5 million in equity." They could have a million dollars in equity, but someone's going to take a lot of money out of the company for that $5 million. 

Whereas the thing is a lot of opportunities, especially now in this climate, especially where we are now, there are these incubators, accelerators, a lot of pre-seed fund, seed stage funds that are looking to support you through idea stage, even to build out your product.

There are a lot of venture builders, venture-building outfits out now. There [are] a lot of different resources now than there were three, five years ago for people to really take different routes to raising or building idea product. There are people who are bootstrapping the whole thing without capital. There are other people using the incubator accelerator route. 

But I think as a founder, as you're starting out, the feeling might be to rush for the first VC capital to validate your product, you have to have VC money in, but it's less about the money and more of what you're building. Especially as a founder, you're looking to build something that lasts, so think it through like, how do I get this?

I've seen a lot of ventures start out getting some really great R&D grants to build out their product and then they will then leverage family offices and some more classic VCs in their seed round, and as they prove out their concept, [inaudible 24:02] VC story. 

There's no right answer to that question is what I would say, but I do think that thinking that equity is the "end all, be all" was definitely a flaw. You should definitely allow yourselves to look at what different ways you [inaudible 24:17] and also not give up as much equity of your company so early as you're building it out.

Maiko Schaffrath  24:23

Great advice, especially for impact companies. [Are] there any resources or ways of approaching this on grant funding or any alternative funding to VC investing? How would you suggest the founder goes about this finding those grants or other funding options?

Jasiel Martin Odoom  24:41

Absolutely. The great thing is in a lot of countries now, especially in the Western world, there [are] a lot of grant outfits out there. I know in the UK, for example, it's Innovate UK. The Department of State does a lot of work, a lot of foundations do a lot of work in giving out grants.

Looking at the family office foundations and the nonprofit space, government agencies often are doing innovations, universities, I've given out grants, so there's a broad variety of places to get grants, and they don't all have to be science-focused. 

You might have a very science-focused idea, but impact investors, impact funders cut across the broad spectrum. I think there's a lot funding out there that doesn't get tapped into such as in this line of impact space that can de-risk your view or your idea as you start out.

There [are] also a lot of grants that you can use in addition to your private centers. You're not spending equity capital doing R&D. You can use some grants and budgets, so there are more than a few differences in place, but in terms of resources, philanthropical funds is not my specialty, but there [are] quite a few of my portfolio companies, I've raised funds. I'm always happy to connect people to people who have more to say on it.

Maiko Schaffrath  25:57

That's great. Let's talk a bit about the intersection of social and environmental impact and backing founders from underestimated backgrounds. Obviously, worldwide, basically, there's a true problem in the VC industry of actually backing founders without looking at gender, at skin color, is that right?

Whenever you look, for example, there is an annual report from Atomic on the state of European tech year by year. Unfortunately, the metrics are quite depressing. Sometimes, there [are] slight improvements. 

But in terms of backing female founders, depending on where you look at, it's like 1%, 2%, 3% of all VC funding goes to female-founded companies. If you look at founders, minority founders, it's even less, and it's been a problem in the VC industry for a bit.

That's why I love that you personally, but also Unreasonable Collective, really has the mission to fund underrepresented founders. I'd love to understand from you, obviously, it's an important problem to solve, and it's great that you're working on this. But is there a specific perspective you have on combining the social impact of the company, but then also funding underrepresented founders to solve these problems? How do you think about the intersection of both?

Jasiel Martin Odoom  27:30

For sure, I mean, the easiest way I've hear it said is that underrepresented founders are solving real people's problems. I think that the issue with VCs is a bigger one caused by society where capital has continued to flow towards historically white males in startups, in the VC world which is not different from most parts of life in general.

But I think for us at Unreasonable, what makes us different is that we're making an intentional look for founders that are underrepresented. 

I think for a lot of VC funds, it hides behind different things like we're a product-first company, we care about the product, it doesn't matter who is building it, but that allows people not to do the work of sourcing companies that are building products that are run by women, that are run by underrepresented founders that do not get funded, and you go to a classic big European VC fund's website, and I did it today.

I did a sample of their company. No woman was invested in 30 other companies. There [were] maybe three people of color that were men and they are a product-first investment. So, yeah, we don't look at anybody, but it trends towards white men only that they fund, and I think that that is that issue with VC spaces that, to me, why not make this easy and actually go out in stores for this and make diversity as not just a nice to have, but a have to have. 

And for us in the Collective, it's very important. We have metrics that we have to meet. And so, for that, we have to bake in going out to have these conversations, it means for me sometimes having two, three times long conversations, because overall, as you mentioned, Atomico does a really great report, but it's harder for people of color, for a woman to raise capital.

So, what that means is that in the same amount of time I would be taking my SaaS company funded by a white man that's focused on impact to raise capital, it might take a woman of color twice the time to get to that point. So, as an investor, I always focus on really driving capital in general for the founders.

My job because following up and making sure that I'm like, "Hey, I noticed it takes a bit longer, but my interested hasn't waned. We're still here. I'm so interested in this idea," because I understand that when you pull back, the ecosystem itself, it needs fixing as an actor in the system. We make a choice to actively be a part of that. I think that's the issue with the VCs. 

They write all these beautiful reports about, "We need to raise more money for women, more money and for people of color," but no one is actively mandating themselves to do that. No one would say that, "For my fund, if we don't have 50, if there's another portfolio in there, we're not doing any more deals.

The next ones are the people I've told is a woman of color." If we start to force people to have to go out and source companies outside from their universities, from their clubs, and they have to go to places where they wouldn't know they have friends, we find a lot of people are building really great businesses that are probably in the Impact Hustlers community that are not getting access to capital.

Not every capital can service every company, but I do think that it's a bit of an anomaly that we continue to fund only primarily companies that are founded by straight white men.

Maiko Schaffrath  30:52

Just a really quick break from this episode to let you know a little bit more about our podcast producer and content agency, Content Multiplied. With all the moving pieces of a business, you can't be stuck managing and creating new content all the time.

That's why I've started using Mhyla and her team at Content Multiplied. It's really an all-in-one content management and repurposing solution that can handle all your content needs. Visit them at contentmultiplied.com today. Contentmultiplied.com. Okay, let's get back to the episode. 

I love it. I have a few more questions on that, actually, but I just want to remind the audience that it's time for you to ask your questions as well. You should see an option here in the studio to actually request to get onto stage, so if you do have a question, please do that, and it will pop up here on my screen, and we should be able to get you into the video call and let you ask you a question.

So, yeah, do ask a question. Don't be shy. We're here. That's why Jasiel is here, and that's why we're doing the live podcast. 

But until we get the first few questions in, I would say I'll ask you a few more on that, because that topic specifically is close to my heart, and I think what you just mentioned is a really important one as well of as an investor being patient with underestimated founders and not letting the bias of the ecosystem be a wrong signal for you.

I did a podcast previously with Gary Stewart, who is the founder of Founder Tribes, which is a platform for underestimated founders actually, also highly recommended for underestimated founders to raise funding through them. But what he found, he actually really struggled to raise funding, and he's an experienced entrepreneur. He's exited the company before, and he still struggled to raise funding, especially in the UK. 

He found it much easier in the US. But if you looked at that and the time it took him to raise money, and as an investor, you say, "Oh, he's very slow with raising his money. That must mean his company isn't great."

No, this is the bias of the ecosystem speaking, and as an investor, your role is to not let that taint your picture and actually just look at the fundamentals of the company rather than, "Is anybody else investing? Is this a good company? Is this a good business model? What's the attraction?," and all that stuff, going back to those things.

I think probably one of the biggest evils in the VC space is sometimes this herd mentality like who else is investing? Is one of the big brands investing? Otherwise, I'm not interested. Is that a good summary?

Jasiel Martin Odoom  33:41

Yeah, that's a great summary. It's a great summary. I mean, it's indicative of exactly where we are right now in the VC space. A really great article by Jerry, I can't remember the last name of VC and Management. It's on my Twitter.

She writes a really great article around how much of VC has become super interlocked, and I think that it's where we saw these things is like, everybody's hoping to see some sort of name on a company. 

For me, one of the things I do not look at actually is who else is in the round. We're in minority investors, and so we need to follow the terms of the leaders. Having a good leader on the board is helpful for us, but before we get to that point, we make a decision based on whether the company is good on its merits. It's interesting.

A great lead investor is a great thing to look at. But so often in VCs, we have these signals that we have that are rooted in the system and so are rooted in prejudice. You signal if a big VC invests in them, but big VCs are always investing in a company that do not have women or people of color.

And so, you assume that when you're a color company, [you] are not interesting businesses. That's why you see now that it's pretty notified that emerging founders that are focused on some of these under the grooves are turning with returns had on the traditional fund, and that's why a lot of funds are also rushing to the seed stage space now, because they're all looking for returns.

Today, I say it all sounds great, but we need to start to build systems that are intentionally focused on as a metric just as much as you look at your [inaudible 35:17] causes as much as you look at what kind of traction they have. We should include diversity in this space and diversity of the team, who is in the team.

That should be a metric for us to go out and find companies, because we will find that it will force us to source in different places, and there [are] some really great companies that are not your big VCs but are doing amazing work.

Maiko Schaffrath  35:40

Amazing. We got a question from Joel, and Joel, I'll get you on stage now, and it's all about explaining the environmental problem versus the business opportunity when pitching to investors and how did due diligence change. But Joel, I'll let you come on stage and ask the question straightaway to Jasiel. So, there we go. Joel, you're in Berlin, is that right?

Joel Tasche  36:04

Currently in San Francisco actually, but usually based in Berlin.

Maiko Schaffrath  36:08

In San Francisco. 

Joel Tasche  36:08

Yeah, so fundraising in process for Series A actually. Hi, Jasiel.

Maiko Schaffrath  36:16

There we go. You should talk in more detail. Joel is the founder of a company called Clean Hub. Basically, they do what other companies do with carbon offsetting for plastic that can't be prevented, but Joel, I'll let you introduce yourself in more detail and then ask a question. Go ahead.

Joel Tasche  36:37

Thanks for the insights. Really, really interesting. The thing that I find interesting now when pitching, so if we speak to impact VCs, we speak to classic VCs is the awareness of the environmental problem, or in the end, we're working in waste management, which is an industry that not a lot of VCs ever went into and where people don't have a very deep understanding of the industry. 

Well, if you build a B2B SaaS product, obviously, it's much easier to say, "Look, we're building B2B SaaS for, I don't know, accounting," and everybody immediately understands, okay, this is what's going on.

But finding the right balance between creating an understanding for the industry that we're active, what the problem is we're solving for that specific industry, and then how we're making money, that's a lot of information, and at the same time, the pitching time you have is no different from a B2B SaaS.

I wanted to get your take on maybe what you've seen work well in pitches when it comes to these things, maybe also how founders can prepare you better as an investor to understand an industry that is usually underrepresented by VC. What are your takes on that?

Jasiel Martin Odoom  37:56

Absolutely, sure. Thank you, again, for asking the question, and I think you're exactly right. First of all, we're actually right now closing a deal in the waste space, not in the ocean space, but in the waste management space broadly, and I get it, and I understand it and learned that the waste problem isn't one that a lot of people can grasp the clear linkage to business case.

I think what I found that has really been interesting is being able to show who cares about the issue. To be able to point to a VC, for example, I'm looking on your website now and you have collection targets, and then you have collection hubs. I like the step-by-step approach. 

I think that the key then becomes, you're helping keep our oceans clean, and if it's a for-profit business, of course, this is how we can make money. And this is the wild thing; this problem is important to this guy enough to pay us this much.

I think the company I'm investing in, they made it very clear for us like, "Hey, listen. Our solution is easy to put into these people's systems. They care about margins. We could reduce their margins by x percentages, and it's retrofittable across any of these platforms, and it costs 90% less than what they already do right now."

And then, that makes me go, "Okay, interesting." But of course, we have the wage component, so then, they tell me, "

And these are the key tailwinds why this is becoming a problem that it's going to have to be focused on," if there's legislation, if there is groundswell movement, if they could prove that like, "Hey, listen. Not only is this a good business case, but as an investor, it puts you in the form of validation that it's already going to be happening. We're already heading this way. Do you want to get on this wagon? Because we can prove this business case for you."

I think that, often for me, makes me comfortable enough to then go and do my own due diligence to see if I agree with the estimation of what the problem is.

Joel Tasche  39:58

Yeah, yeah, understood. And then, the other part that I find interesting and somewhat maybe even varying, there [are] more and more companies now coming onto the market that say, "We want to do good for the environment," and there's going to be massive amounts of money being put into these companies. 

I was at a conference the other day where I spoke to a VC that is new to the space and asked them, "How did your due diligence change for investing in companies like that? How do you make sure that this is actually also from an environmental perspective a good investment?"

They said, "We didn't really change the due diligence," which I find, to some degree, boring, because you could easily find a wrong solution that's going to or might even create more harm. How do you approach due diligence with your fund, like from a business perspective but then also from an impact perspective?

Jasiel Martin Odoom  40:54

Yeah, for sure. I think from an impact perspective, it's important for us. As much as we're trying to turn returns for our LP base, we're also very much focused on the impact metrics.

And so, the very first thing is, be able to understand what the impact is in a way that is measurable, and the way we like to measure it is see we use the UN SDGs to be able to point something that's trackable, that we can see if you have a process to track this data and report data in your business model either as is or as part of your growth trajectory, number one is important for us. 

That helps us understand that there's a system in place, but to get comfortable, whether or not this actually is the solution that solves it, one thing that we're learning is that we're not the smartest people in the room always.

For a long time, I've always thought that the smartest people had the money, and for us, it's the opposite, because we are building a network-powered VC as a whole. I had a conversation recently about carbon sequestration, which I knew a bit about, but I'm not a genius on it.

One of our members in our network said, "Absolutely, you need to bring on this." I [inaudible 42:05], "Hey, can I have a conversation with you? Let me understand what makes sense." 

So, reach out to people who know more than us is the most important part, especially in impact, because in the world, we're finding that we may have the capital, but more important than capital, we have people who have experience that is not only helpful for our due diligence, but more importantly, we deal with these companies, because we want to make sure that we can support them post-investment, to be able to say, "Okay.

We know for a fact that we have somebody in our group that is good at understanding the mechanics of waste sorting," and so if we need to build some relationships to other waste sorting facilities, we have someone who could potentially be interested. 

And that for us, I think, is how we both de-risk it but also put the founder first, because we don't want to just put capital and say, "Okay, yeah, go make us rich."

More important is that what we really care about is, yeah, it should make money, but we care about the fact that we're trying to solve a real problem, so how can we, after we put capital in there, make sure that we have a group of people who can support the founder is sometimes very important to us.

Joel Tasche  43:09

Yeah, alright. It sounds super interesting. Let's, if you want, definitely connect, because I think what you're about to invest in sounds super interesting.

Maiko Schaffrath  43:19

Amazing. Joel, if you like, you can even ask one more question. But also, a reminder to the audience, if you still want to ask questions, feel free to raise your hand and request to go on stage, and we'll have time for one or two more questions. But Joel, if there's any other follow-up that you'd like to ask, feel free to do that.

Joel Tasche  43:36

I think for now, I'm good. It would be great to chat, and I'll just drop you a `message.

Jasiel Martin Odoom  43:43

Absolutely. Please do.

Joel Tasche  43:45

Thank you so much.

Maiko Schaffrath  43:46

Amazing. Thanks, Joel. I'll see you soon. Great. Thanks, Jasiel for sharing that. Super interesting. Again, where we're still open for questions for anybody in the audience. Feel free to just request to go on stage. You guys should definitely connect by the way. Joel has been on the podcast a few episodes ago.

It's a good one to check out as well, so always good to see previous podcast guests join in again. Thanks for joining during this busy time of raising. 

Maybe we can cover just a few more points and hints for founders that are currently fundraising and on investment strategy, especially when you need to talk to a lot of investors at the same time, and you need to herd the cats almost in a way that you line up the investors in a way that you can drive to timeline as a founder, make sure that you're closing your round in time.

But at the same time, it is quite a challenge, I think, from a founder perspective, to manage the relationships with so many investors. Some investors are really slow to respond. They may require four or five meetings until they invest. Some are really quick and almost invest within two weeks, very quickly turn around.

Is there any advice you can share from a founder perspective how to best approach the fundraising process and line up the investors in a strategic way that then puts founders in a perspective that they are powerful, they can negotiate, they have different options and ideally get a few term sheets at the same time? Is there any advice around that?

Jasiel Martin Odoom  45:25

Yeah, absolutely. I think that the very first advice is once again on this, look at the market that you're in. For example, you're in a B2B SaaS business. You probably can find a hundred investors that will give you a call. If you're in a very specific field, it might take some time.

What I often tell founders is that always start to fundraise before you need to close a round, so eight months, nine months before you actually raise, open the rounds to having conversations with existing investors [inaudible 45:53].

That's a very good thing. It's a great help. If you can have your existing investors double down to your round, it's often very helpful. It helps you have to go out to raise less money, which is less time you spend outside the market. 

Sometimes, [inaudible 46:06] existing investors, and more importantly, it activates your networks essentially. Go out there and have larger conversations with other people in your network that you're thinking about raising your fund. Just call investors you're looking at.

More importantly, also, like I mentioned earlier, clarify what your story is, what your investment story is, and that will help you decide which kind of investors you're interested in, because you want to make sure that you're not just spraying invites to people who might not be a fit for you.

For example, we don't do anything pre-seed. We rarely do seed, so pre-seed stuff or pre-idea stuff, excuse me, will not be a fit for us. So, to be able to do some of the work of figuring out what round am I in, it was interesting in this space. 

These days, there's a lot of software and platforms out there that you can get access to figure out like who's raising what and who has how much money etc. But, being able to start that conversation early, I think it's very important, because you don't want to be three months away from running out of money and then starting to raise, because like you mentioned, some founders take three days, some founders take nine months, depending on who they are and what their story is.

And so, I'll admit, sometimes, founders are [inaudible 47:29] being operators, and so they missed that inflection point to start to have those conversations. As a founder, beyond building the business, also looking forward and thinking through, "Okay, we're going to need money in 24 months.

We could just raise that seed round, it means in about 12 months, we should start to have some reportable metrics to say, 'Hey, for the seed round, this will be done in traction.'" It might be too late, and then maybe in about 18 months, start to have some conversations with new investors. 

That's to really prep the market, so by the time you go to market, people have seen your deck, people have had some conversations. And the second thing that's also important is having a data room that is already filled out. It makes it super easy for us to review the companies quickly. As we know, in a virtual world, half my team sits in New York.

I sit in [inaudible 48:20] most days. My colleague sits in Nairobi, so we're a very distributed team, so we do everything asynchronously. Having a data room that you can share with us that we could share after we view your public-facing deck and we like what we've heard so far, [inaudible 28:35]

we can go in and start to dive into that and build all of these around it, one, it helps us to make decisions and be able to let you know whether we're interested or it's not fit for us even quicker, because we also understand that the fundraising journey is a really long one, and we don't want to be a drag on your resources as well.

Maiko Schaffrath  48:54

Got it. Amazing. That's really good. So, if a founder isn't raising right now, they can still email you and how would they best frame it? They would just say, "Hey, we're not raising yet, but we'd love some advice." Is that a famous advice on asking for advice? Or what's the best way of reaching out to you and building the relationship with you early on?

Jasiel Martin Odoom  49:17

Yeah, for sure. I mean, I think a clear ask is very helpful, because time, of course, is very limited. I have a lot of calls on my calendar. Sometimes, I open my calendar for people to throw things on there, so having some kind of call to action that like, "Hey, I'd love to talk."

I had a call with someone who messaged me on Twitter and she was like, "Hey, I just want to discuss generally about my idea that I have." That gives me a [inaudible 49:42] I'm coming here not to review a pitch deck, not to be tactical. If you're like, "Hey, I'd love to review this strategy, this idea. Do you have a second?"

If I have a second, if that's fit for what my expertise is, I know where to go. The thing is, for me is a clear call to action is helpful, because I'm able to see, because I always have to talk to founders. It's one of my favorite parts of my job. It's one of the things that I love to do the most, talk to founders and help them think through their ideas.

So, having a clear call to action helps me also turn, so I come into a call, I know that for the 30 minutes or so we have together, I can be effective, I can be impactful, I can do some homework beforehand, so I'm not just wasting your time, and we have to have another meeting again post the first meeting.

Maiko Schaffrath  50:22

Got it. Thanks, Jasiel. I really appreciate your time today. There's a last chance for anybody in the audience to raise their hand, but if not, that's fine as well. Maybe if you want to reach out to Jasiel separately afterwards.

I also know that a few members of the community that are spread across a few different time zones will be watching the recording of this and may get in touch with you. So, really appreciate your time on making this and can't wait to release this podcast and to collaborate more in the future. Thanks for joining.

Jasiel Martin Odoom  50:57

Absolutely. Thanks for having me.

Maiko Schaffrath  51:00

Amazing. Thank you so much.

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