Colin Boey enjoys a solid reputation as a global investor and syndicate leader, especially in the B2B SaaS niche, thanks to his sharp strategic insights and remarkable ventures. He’s always had an eye for innovation and growth, which is evident when he emphasizes the significance of aligning founders and investors and dispels common fundraising myths. Colin also sheds light on the enduring benefits of SEIS/EIS for UK startups, and reveals why he’s wary of pursuing AI just because it’s trending.
Why did you become an angel investor?
I’ve always had a deep fascination with technology. Before diving into angel investing, I primarily focused on publicly listed tech companies. My investment banking years exposed me to fundraisings for high-growth private companies, and that’s where I discovered early-stage venture and angel investing—it was like a revelation.
In 2020, I left the investment banking industry to fully immerse myself as an angel investor and syndicate lead. Our syndicate is a melting pot of talent, including bankers, financiers, startup operators, founders who have exited, and small family offices. We welcome anyone who finds excitement in evaluating deals. I’m especially driven to assist those new to angel investing, with just one condition: active involvement. There’s no pressure to invest.
Which sectors or new investment opportunities are you most excited about right now?
I’m particularly drawn to the idea that software, which automates manual workflows, can lead to major productivity and efficiency boosts. Startups tackling significant workflow challenges often promise solid returns, assuming they can attract customers with ease and at a reasonable cost.
AI might be the talk of the town now, but I’m cautious about diving into it just for appearances. With the current technological landscape, founders should contemplate how AI can bolster their offerings. However, labeling oneself as an “AI company” just to ride the trend is quite obvious and not advisable. Investors will catch on quickly.
What are the key foundations to building a strong relationship between investors and founders?
Integrity and trust are the core pillars. Founders must be open about their business challenges and vision, while investors should be steadfast partners, honoring confidentiality and offering support during challenging times.
It’s crucial for both parties to be on the same page regarding the startup’s goals, values, and long-term plans. Clear communication about growth strategies, exit plans, and milestones from the start can prevent conflicts down the road. Regular updates and candid discussions about progress, challenges, and opportunities are vital. Founders should not shy away from sharing bad news, as transparency fosters trust. Don’t hesitate to seek help when needed.
Ultimately, while founders steer the business and make operational choices, investors should offer guidance and strategic insights, respecting these roles.
What common misconceptions do you encounter among founders about the fundraising process, and how can they better prepare themselves?
A prevalent misconception is underestimating the time it takes to close a funding round, especially in challenging environments. Founders understandably prefer focusing on product development and customer acquisition, but their primary priority should be ensuring the company maintains financial stability.
Start reaching out to investors early. Consider bringing on an investor relations associate or collaborating with a fractional corporate development officer like myself. Preparation is key.
What are the most important factors that lead you to back startups today, and has this changed over the years?
I’m drawn to founders with unique insights into addressing substantial global challenges. Ideally, they’ve gained some traction, demonstrated by multiple customers who validate the product’s value proposition, alongside a clear and reasonable plan to secure more customers. Founders should also communicate why now is the ideal time to tackle the challenge at hand.
Valuation also plays a critical role; it needs to reflect the risks we, as investors, are taking on at this stage.
How do you measure the impact of an investment beyond just financial return, and does social responsibility play a role in your investment strategy?
Though my focus on automation and productivity might have a broadly positive impact, my main goal is generating positive financial returns.
Nonetheless, I’m conscious of the diversity across my investments. I’m proud that 46% of our investments support underrepresented founders, with an additional 31% involving female founders. Overall, 77% of our investments have backed diverse teams.
As market trends and economic situations evolve, what approaches are you employing to mitigate risks while identifying promising startups?
Adapting to current market conditions is essential. In light of recent challenges like the ongoing situation in Ukraine and rising interest rates affecting global investor confidence, I remain on the lookout for promising startups.
History teaches us that great companies such as Uber, Airbnb, Slack, and GitHub, emerged from the 2008-09 financial crisis. However, I’ve become more discerning, raising the quality bar when evaluating startups to account for today’s risks.
What is the next wave of innovation we are seeing in B2B SaaS, and are there any particular companies worth watching?
The ongoing wave of AI-powered automation and personalization is still in its infancy, with much untapped potential. The evolution will likely advance towards truly autonomous AI, capable of managing intricate, multi-step processes across business functions, reducing human intervention, and freeing up valuable resources.
If you want to discover exciting companies together, feel free to connect with me on LinkedIn and join my distribution list.
If you could offer just one piece of advice to a young startup, what would it be?
Embrace the long journey ahead. Ensure that you’re truly passionate about the problem you’re solving and build a robust support network of early employees and investors around you.
What could the new Government do to best support the UK’s startup ecosystem?
Given my global network of investors sourcing opportunities worldwide, I’m less influenced by a single government’s actions. Nonetheless, the SEIS and EIS schemes have been incredibly beneficial for the UK startup ecosystem. I hope they continue to be available.
