#1 RS: The first of many
Revenue Syndicates first newsletter, contained is our latest investments, RS news, events, a GTM tip and an investing tip.
Hello and welcome to our first ever Revenue Syndicate newsletter! We are aiming to send this out on a monthly basis to make sure that you are up to date with what has been happening at Revenue Syndicate and give an insight into what’s coming up over the next month (plus highlighting a few interesting GTM tips and tricks).
Please let Nick Dashfield (Operating Partner) or Hector Forwood (General Partner and Co-Founder) know if you have any queries, or you just want to chat and find out more about Revenue Syndicate!
Deals closed this month
Setyl
Why we invested
Setyl has been providing a steady growth throughout its life cycle, we’ve seen a progressive rise in ACV whilst continuing to sign larger enterprise logos such as the NHS & Natwest. Furthermore, it’s had Cognism’s CEO, James Isilay, join the board to aid its GTM capabilities. They continue to be on the verge of profitability and took capital to increase the rate of growth.
A bit about the company
Setyl provides IT Asset management, software license management, people management and hardware asset management. An end-to-end solution for tracking spends and assets.
Platformed
Why we invested
The founder, Henry Irish, previously exited passfort to Moodys analytics for (est. $150M) and the biggest tell tale sign of a company that’s going to do well is a founder that has done the journey successfully before. This, deep subject, understanding of the compliance market and the move towards unregulated technology (e.g. Generative AI) ensures that this is a timely product.
A bit about the company
Platformed helps sales & customer success teams to meet their customers’ procurement & compliance requirements from pitch through to renewal.
Portfolio news and updates
Foundy.com
Foundy is an M&A marketplace to buy and sell businesses, augmenting the process. Selling a business in 25 days from beginning to end! P.s. here’s their referral link if you want to refer a founder! Whilst
They’ve broken 10,000 users (buyers & founders) and are currently hiring for:
1.) Head of Revenue Operations (Marketing + sales + customer success).
2.) Senior Frontend Engineer
3.) Product Manager
4.) Head of Operations
https://jobs.ashbyhq.com/foundy.com.
Event on 23rd November
We are excited to announce hosting our next Revenue Syndicate meet-up in partnership with the #1 Sales Engagement Platform, Salesloft!
It's that time of year again when we get together and have a blast networking, learning from guest speakers, and enjoying some drinks.
If you're interested in angel investing and go-to-market technology, join us on Thursday 23rd November, from 6:30 pm to 9:00 pm at Aviation House in Holborn.
Our topic for November is 'The Rise of GTM AI' - we'll be talking about how to approach investing in it and leveraging it to generate more revenue.
We're excited to announce that our guest speakers for the night will be a combination of founders, operators and investors:
- Henry Irish, CEO at Platformed
- Alexandre DEPRES, CEO at LoneScale
- Coralie de Robert, Sales Director at Salesloft
- Akash Bajwa, Investor at Earlybird Venture Capital
The panel will be moderated by Nick Dashfield, our Operating Partner.
There are going to be plenty of opportunities to mingle with like-minded individuals, share investment ideas, and just generally have a good time.
We'll be providing drinks and food throughout the evening to help you relax and enjoy the night.
Please note that this event has limited capacity, and we can only accommodate 160 people. So, make sure you RSVP below as soon as possible to secure your spot!
https://partiful.com/events/EoDkIEaFj81njqVu2uzc/edit
LinkedIn highlights
Grok has been released, and it’s different. Very different. We say that because it has a real-time data feed from X (formerly Twitter). This leads me to question has serious or relevant its outputs will be. Although, it does provide promise for getting real-time data/updates for conflict zones or national emergencies.
A beginners journey into angel investing We know some of our readers haven’t done any investing before or are just tipping their toes in the water. This is a very honest and pragmatic article about Sola Osinoikis journey. It highlights one of the best parts, meeting exceptional founders at the top of their field and connecting with other investors.
Slower Investment Pace in Venture Capital One of the core values we provide founders and our portfolio is deploying capital quicky, efficiently and ongoing GTM support. This article highlights extended due diligence processes, longer fundraising timelines and “a season of caution”.
How to position yourself for VC Funding RS has its own criteria for investing however, when you raise VC capital, the requirements and asks are substantial. This breaks down every step towards getting VC funded and gives a fair review of the process.
GTM Tip of the month
Mutual Action Plans (MAPS)
Long sales cycles killing your growth? Then look no further than a MAP! MAPs are pretty exciting for a GTM motion. It’s a collaborative document made between yourself, your champion (and ideally an executive). It’s a string of steps, with dates and who needs to be involved at what stage, what tasks each person owns and the tasks required to complete a step.
This was popularised and executed almost perfectly by DarkTrace. They sell enterprise cyber security products (imagine the procurement, technical requirements and security processes just to get in the door). If we give a ballpark of 12-18 months to an enterprise sales cycle and by enterprise (1000+ employees and an ACV of $200,000+), they crushed the enterprise market with a MAP and brought them down to 6-9 months. Here’s their publicly available one: Darktrace PoV period
So next time you’re in a long deal, just remember to get your map out which is sure to bring you to the end destination. Here’s the data behind them:
90% expedited deal closures & shorter sales cycles
70% higher win rate/higher conversion rate when in use
60% Stronger customer relationships / long-term partnerships
Revenue Syndicate Academy
Every month we’ll seek to highlight an investment concept or market theme which may be of interest to our community. This month we begin with Convertible Loan Notes (‘’CLNs’’), which have been around for some time and are a popular means by which companies can raise capital in ‘’bridge rounds’’, which typically take place between the familiar Seed, Series A, Series B, etc. equity funding rounds. We expect CLNs to become more popular again as companies seek to extend their runway in view of the current adverse macro-economic headwinds.
What is a CLN?
A CLN is a form of loan made by an investor to a company. However, a CLN does typically come with an option to convert into shares at the next funding round, usually (but not always) at a pre-agreed discount to the valuation at the next funding round. If the next funding round is significantly delayed CLN folders may also have the option to convert at a pre-agreed longstop date or receive their money back (plus interest). A company will usually pay interest on a CLN but, rather than repaying that interest directly to the note holder it will usually be added to the outstanding loan and be reflected in the amount equity eventually issued to convert the CLN.
Why do companies issue CLNs?
CLNs are typically easier to document and agree than equity issuance and allow companies to raise money without having to re-value the company before it has reached certain commercial milestones and begun the process of launching a full equity round.
What are the potential advantages/disadvantages of CLN’s for investors?
The key potential advantage for investors of holding CLNs is the potential discount they will receive at a future funding round, which could be particularly attractive if the company is successful and the CLN holders also managed to negotiate a cap on the valuation at which the CLNs are eventually converted to equity (although it still may not be as good as if they had participated at an earlier equity funding round). A discount on conversion will still apply if the company raises a flat or down round, providing holders some degree of downside protection. Debt also typically ranks higher than ordinary equity in the ‘’capital stack’’, meaning that CLN holders will potentially be repaid first in the event of insolvency. Moreover, CLNs typically accrue interest (which may or may not be compounding), meaning that a delay to an equity funding round taking place will usually reflect in CLN holders receiving an increased number of shares on conversion.
However, holders of preferred equity classes will likely still be repaid first in the event of insolvency, reducing the likelihood that CLN holders will receive part/all their loan back, particularly where the CLN is held in an early-stage business which will likely have very little recoverable cash to repay investors on insolvency. CLN holders will usually not be able to enjoy some of the rights that are enjoyed by shareholders until conversion, including voting and dividend rights.
Best wishes,
Nick & Hector