Tracy Doree, Co-Founder of Kindred Capital, investor in tech start-ups, and pioneer of equitable venture, talks about the firm’s vision and plans for 2018.
Congratulations on closing Kindred’s first seed fund at £80 million. What is it like to have reached this point?
We had maybe five seconds of elation and then it was straight back to work! We’ve got huge ambitions to become the best seed fund in Europe and that’s going to take dedication and focus, so we don’t really have time for big celebrations.
Your long-term approach is reflected in founders being co-owners in the fund, enabling them to profit even if they leave their business. Can you tell us more?
What we wanted to do with the model, and the way that we’ve set it up, is to say we’re incentivising positive behaviour in the Kindred community. The way we do that is to give each founder we invest in a share of the profits (or “carry”) in Kindred, so that they benefit from helping each other. We say that when we invest in a company, they get a whole army of people helping them, not just the four partners.
So, yes, provided the founders continue to contribute to the fund’s success, they still keep their carry, irrespective if their own company succeeds or fails.
What we’re seeing so far is that founders really do collaborate, which I find very inspiring. You can see the speed at which founders can go from decision to execution as a result of working with one another.
Would you like to see your concept of equitable venture, with founders as co-owners in the fund, being replicated, and do you think it will be?
Yes, we believe that this is a powerful idea and we’ll see other funds adopting it in the coming years. Winning in Venture is all about finding exceptional people who are building society, technology: economies of the future. Founders relate strongly to this concept and it’s one of the tools that helps us win.
What key pieces of advice would you give to someone looking to get a tech business off the ground?
Just start. It can feel overwhelming some days, but lay the foundations, pick up the first block and cement it to the ground. Hopefully, shortly after, you’ve built a wall. Just begin.
And don’t feel shy about sharing your idea. The aim of the game is always to know more tomorrow than you know today. The quickest and best way to do that is to share your ideas with other smart people that you respect. Get their perspective, get their experience, and build on that.
With Kindred companies having been introduced to The Bakery’s clients, and a similar collaborative ethos, what is most useful to you about its processes?
Open-minded, fast moving, and high-energy people. I always feel really excited to introduce anybody to the people at The Bakery. I get a really positive response from them.
At the end of the day, a company is this theoretical construct that we all believe in. It has this design to be a singular identity, this entity. But what is it? It’s just a group of people that have a similar belief system, trying to execute against a common goal.
The projects that The Bakery does, the clients that they work with, the way in which they work with founders of businesses, changes all the time. It has to. This market that we work with — tech entrepreneurs — the world is changing at an exponential rate. We’re in that crazy moment of change. They are constantly evolving but the thing that is constant is the mindset and quality of the people.
What are the benefits for investors of working with The Bakery?
We buy a portion of a founder’s business. By working with The Bakery, if that business is able to get more clients, more exposure and maybe hire new people — finding the best people and getting revenue for your product are two really hard things to do. If The Bakery can help with those, then it adds huge value to the companies we invest in.
What would you highlight for Kindred in 2018?
2018 should end with our portfolio consisting of at least 25 companies, which will be a major milestone for us.
If anybody is right at the beginning of what they’re doing, solving a real problem, are truly exceptional in some way and they’ve got an ambition to build a really big business, then I’d love to speak to them.
What books are on Kindred’s must read list?
The one book that resonated with all four Kindred partners is Give And Take by psychologist, Adam Grant. The basic premise of his research is that that the very top performers are often unequivocal and generous Givers (as opposed to Takers, or Matchers). Giving with no expectation of reciprocation is something we all instinctively do and it was great to understand why this philosophy works. I also think that it’s going to be increasingly how business will be done in the future.
The other book we all loved was Yuval Harari’s Homo Deus. If Sapiens was the history of the past for humanity, Homo Deus is the history of the future and it has some really fascinating ideas.
How would you describe your philosophy?
I really believe in coupling high standards and deep devotion. It’s easy to be devoted if you don’t have high standards and easy to set high standards if you don’t worry about people, it’s difficult to do both but that’s the approach I believe we’ll use to win.