The Valley of Death


The average valuation of each partnership at the end of the day is £4.5 million. “Not bad for a six-month-old company,” says Clifford. It’s not a foolproof process, of course. One EF alumni, Magic Pony, only managed to sell a 30 per cent stake on Demo Day, for £1.5m. A mere 15 months later, however, Magic Pony was acquired by Twitter for $150m. The investors who did have faith made about $45m – $3m for each month they held their stake.

EF may be taking the mystery out of entrepreneurialism, but it appears to be working. “Picking from a curated group of people is the smarter way of doing things,” says Clifford. “It’s like online dating. 40 per cent of weddings today are of couples who met online.” Indeed, the reason I am speaking to him, and not him and Bentinck, is that she is planning her own nuptials – to the man she met “in a bar”.

Most people are not lucky enough to get taken on by EF. Their start-ups are founded the good old-fashioned way, by people meeting randomly, starting a conversation, realising they share an idea, and then plucking up the courage to give it a go. Herman Narula, founder of Improbable, one of Britain’s billion-dollar “unicorns” met his co-founder Rob Whitehead while they were queuing to have their dissertations reviewed at Cambridge. “We started talking and within literally 30 seconds we had planned to build Improbable,” he says. “I’ll never forget that conversation. The next day we coded for 12 hours, starting to put it together.” Narula and Whitehead soon retreated to a barn on the grounds of Hyver Hall, his parents’ mid-19th century home near Barnet. But other smitten partners usually have to get a room – and pay for it.

Hence the popularity of a host of “shared” or “co-working spaces” in London. They have names like WeWork, RocketSpace, Plexal and Second Home. If you have an idea, and the cash to fund it for six or 12 months, the chances are you’ll end up in something like this. Why? It’s easy to expand – essential for fast-growing start-ups. And contracts are often month-by-month, rather than standard 5-year commercial terms, useful it all goes down the tubes, as it so often does. Meeting rooms, phones and internet connections are there on tap, and are host of extras of often provided too: lectures by successful founders or funders; and of course the chance to network – and perhaps team up with – a host of like-minded souls.

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