Time to dance
Let's make the twenties count; announcing Odin Premium; online events; spicy deals 🌶️
What a mad few weeks. Vaccines, new variants, lockdowns and rumblings of civil war in the land of the free. As the Irish would say … shite craic.
I’ve heard several people make comparisons between the 2020’s and the 1920’s. There are rumblings of a post-pandemic boom. And not just economically… people talk of a creative renaissance, too.
Sounds good to me. I miss art galleries. I miss pubs. I miss dancing. Hell I even miss being dragged to the opera by my better half.
Here’s to hoping the twenties are roaring.
Note: I’ve moved our entire mailing list to Substack. Anyone who has signed up for the Odin platform is receiving this. If you don’t want to see more, just unsubscribe. I won’t be upset.
We’re launching premium
We’ve decided it’s time to ask people to pay us for access to the Odin community.
We’re keeping it simple: £15 / mo, £120 / yr gives you access to all of our resources (investor databases, events, curated content), social platform, Slack channel and syndicate investments.
We’re starting out by making this opt-in: members will not be forced to pay, but they have the option of supporting us by upgrading to paid. 😊
As we bring more resources online and build out the platform, we’ll create a freemium model, where certain features are only accessible to paying members.
We are not selling memberships on Substack, since we are still being selective about who we give access to.
This helps maintain the community’s quality.
The Community Platform
We’ve been working on our community platform for the last couple of months. It’s coming along nicely.
Our vision remains the same. We want to put all the best people in European tech in one place online, and leverage their collective intelligence to drive capital and resource to founders building things the world needs.
Imagine it sort of like Reddit x Crunchbase.
Done right, this should help us to optimise capital deployment and accelerate the pace of innovation in Europe :
Why Europe? We suffer from a chronic underconnection and, more importantly, high opacity / lack of trust in this market. Great founders in Kiev or Bucharest, capital in London. A VC industry where only 8% of investors have worked in a startup, and often come from banking, meaning they think about the market in more of a “zero-sum” way (what Charlie Songhurst refers to as the “East Coast mentality” in US finance).
Members get access to:
Live events, AMA’s and round table discussions online (and offline post-Covid).
Deal flow and deal sharing tools
1-2-1 introductions to any member
All community event recordings
Curated content archive
A growing database of European and global tech investors
Over the coming 6 months, we’ll also be launching Odin syndicates
This will give you the ability to co-invest alongside prominent angels in our network from £1,000 per deal.
Event this Thursday
This Thursday at 1300 GMT / 1400 CET, we will be running our second Odin web event:
I’ve included event details here, with some suggested further reading related to the discussion topics, if you really want to do your homework. 🤓
Thursday’s event is free and open to everyone. Most events in future will only be accessible to community members. Recordings of events will be available.
Spicy Deals 🌶️
A selection of European companies we think are worth checking out, from pre-seed to Series A. If you’re a community member, click the image to go to the company’s pitch page.
Wio Group 🇳🇴
💸 $5,000,000 (£3.6m GBP), Series A
📝 Assessment by Patrick Ryan
What I like about it:
It’s boring, a little complicated to the uninitiated, and the founding team are very experienced. Niche, scalable, fast-growing market, subscription bus. model, network effects.
Most Internet Service Providers (ISPs) want cheap hardware. Cheap hardware has crappy management software. Big ISPs build their own tech stacks to solve this, but this makes their product / service offering expensive and/or limited.
As a result many routers, especially in developing markets, are simply left unmanaged, meaning end users get terrible customer service from ISP’s.
Wio partners with hardware providers (who make routers) to ensure the routers are compatible with Wio’s SaaS solution for router management, which they sell to ISP’s. This means adding a little bit of Wio’s code to the software already being installed on every device during manufacture.
Having this code on the device means Wio’s device management and services software, which ISP’s can white label, works properly. This vastly improves the customer experience for end-users, and the operating margins for ISP’s. If your wifi is down, for example, it can be managed remotely (rather than requiring an engineer to be called out). ISP’s can choose from a vast array of available hardware on Wio’s marketplace, and then pick and choose which service features to offer customers.
It’s a smart product with a lot of network effects potential:
The hardware manufacturers are incentivised to add Wio’s code to their devices because it will make their products more attractive to ISPs
ISPs use Wio’s platform for device management because it reduces customer churn.
Better quality customer service drives more customers to ISPs
This means ISPs buy more hardware via Wio’s hardware marketplace
This incentivises more hardware manufacturers to work with Wio
Arve seems like a really affable, capable CEO. He has deep experience addressing this specific problem, having previously founded an ISP in Norway. The rest of the team look first-class, with the right sector experience. Their commitment to the project has been demonstrated through significant personal investment of time and capital.
What is interesting about this market is the extent to which the problem they are seeking to solve is largely unaddressed (see “competition”).
Estimates for TAM vary and market growth vary, but it is clear that growth is mainly driven by developing markets (non US / EU), where market penetration for WiFi at home is still low.
The global WiFi hardware market alone is worth over $8 billion and forecast to grow at 22.3% to 2025, according to this report.
Whilst 5G is to some extent a threat to WiFi, most analysts believe the two services are complementary and serve different needs.
A large number of players, but nobody has yet done the hard work of aggregating hardware providers and providing a full-stack SaaS solution for ISP’s that is compatible with the very basic protocols that most hardware suppliers are using. This is the secret sauce for Wio.
They charge the ISP per end user. Nice model, very profitable at sufficient scale and flexible enough for ISPs of all sizes.
Traction / engagement
Landed one major contract with a manufacturer for private white-label. 150k households to be deployed per month by the end of Q2. They have several more manufacturers in the pipeline waiting to be onboarded. More ISPs will be invited once Wio secure enough hardware manufacturers on their hardware marketplace (supply-side bottleneck currently).
Financing to date, funding round status
$1.75M invested by founders pre-seed to build the platform and get to product-market-fit. In addition, received public grants of $1.15m
Just going to market for this round, in early conversations with VC’s in Scandinavia.
💸 £3,000,000, Series-A
📝 Assessment by Patrick Ryan
What I like about it:
Experienced team, bootstrapped. Have invested £1.2m of own money, £1.8m raised in grant funding. 3 customers secured, subscription bus. model. Targeting a pretty boring niche (food packing) with solid, recession-resistant growth and a need to improve margins.
Ben and Ben, the founders, run an engineering services consultancy (outsourced R&D), and have used that to bootstrap their industrial robotics company. They started out developing an autonomous painting robot for bridges. They got to a term sheet at Series A with a large US strategic (£3.5m at £8m pre-money), but their investor spooked due to Covid.
They have since pivoted and repositioned to the mid-market food and drink sector, which is larger and contains more low-hanging fruit.
There is a common thread here - the outdoor durability of their painting arm means it can resist cold, damp, etc. - which is great for food packing conditions. Their solution covers a programmable robotic arm, proprietary manipulators/tooling, computer vision systems and customisable software.
Great guys with deep sector experience, incredibly committed and super hard-working.
The global market for robots is expected to grow at a compound annual growth rate (CAGR) of around 26 percent to reach just under 210 billion U.S. dollars by 2025.
Food & beverage is a huge chunk of this market. According to BCC Research (2016), the food processing and packaging market will be valued around $31.5 billion by 2020. Market CAGR 4.2%.
94% of food packaging operators are using robotics already according to a survey by the Association for Packaging and Processing Technologies.
In January 2018, a survey by the Association of Labour Providers found that 70% of food and beverage manufacturing companies were suffering from a shortage of low and unskilled labour.
Lack of full-stack offerings covering manipulators, end of arm tooling, software, integration and servicing. This makes adoption too costly for SME's. Leap’s turnkey approach brings costs down and improves customer experience.
Annual leasing of the robot. Payback is around 15 months on the asset. Opportunities for ancillary revenue include line modifications, bolt on vision systems and advanced data / software mods if the customer wants the data more closely integrates with their ERP system (basic rental comes with a simple csv download)
They've secured their first 3 customers for pick and place applications, including two £500m turnover food manufacturers.
Financing to date, funding round status
£1.8m grant funding, £1.2m of own investment.
In discussions with several VC firms and one strategic investor.
I’ll be sharing two more opportunities this Thursday with paying subscribers.
That’s all for today. Stay classy.