Failing forward: How and why it took me three years to ‘break’ into venture capital

After over three years of applications, 30+ interview processes, two internships and moving country three times, I finally landed a full-time role at a venture capital fund. Over the past three years, there were several times when I considered giving up as the process took a financial and emotional toll on me. All these disappointments meant that, when I finally received an offer to join a firm full time, I was overcome by a mix of relief, vindication and excitement. This excitement has stayed with me over the past two months and I am looking forward to starting a new chapter of my career tomorrow working with Icebreaker Ventures.

I decided to write this post so that those contemplating a move into venture capital have a better map of the junior VC job landscape in Europe, and hopefully waste less time than I did. While I have read a lot of books and posts about breaking into VC, I believe that these materials often misrepresent the difficulty of getting a role by ignoring the scarcity of positions (and consequent hyper competition) and omitting serious discussion of how chance interacts with each individual interview process. This post aims to remedy some of those omissions by describing the lay of the land and providing some practical advice on how to improve your chances of getting an offer. This essay is split into three parts: Part I is my roundabout journey to my current role, Part II is a more structured view of why the market is so unforgiving and Part III contains some practical advice on how to maximise your chances based on the lay of the land.

It would be dishonest of me to launch into this post without first stating my priors. When I decided that I wanted to work in this field, I already had several advantages which made life easier for me. I was fortunate enough to have read Law at Durham University (a well-regarded institution in the UK), I was working as a junior investment banker covering TMT companies (a conventional starting point for VCs), and most importantly I had developed the financial security to uproot my life on various occasions to CV build / network via internships. While none of these managed to stop me from spinning my wheels for three years, they did increase my odds of getting through to the interview stage of any given process. I am doubtful that, were I unable to take the financial risk of quitting my job to do a six-week internship last summer, I would have gotten the role that I have now.

Part I: My winding road into VC – Skip to Part II if you do not want to read my life story

I became seriously interested in the European venture space through an interaction with a recruiter in February 2017. At that point in time I was 1.5 years into an investment banking role in Credit Suisse’s European TMT team and was going through the motions of interviewing with private equity firms (like seemingly every other junior banker). A recruiter reached out to me about a role at a venture fund and, over the course of some fairly intense interview prep, I fell down the VC rabbit hole. The transformation was rapid! Overnight my podcast listening patterns morphed, I found myself encumbered with as Stratechery subscription and I even started to regularly use Twitter. While I did not end up getting that role, I naively assumed that worming my way into VC would be no more difficult than finding a PE role. How wrong I was!

n.b. I do understand that PE roles are extremely competitive! My point here is that it is materially easier for a junior banker to get into PE than it is to get into VC – I would estimate >40% of my intake at Credit Suisse landed PE roles before I left. I appreciate that this is not the case for people without typical PE recruitment backgrounds.

It took me about six months of low interview volume and lacklustre progress to make a change. I decided that I needed to differentiate my CV. I started by creating this blog (which was initially supposed be focused on the intersection of venture capital and video games) and beginning to advise some UK startups in my free time.

This apparently was not enough, recruiters remained largely ambivalent towards me and I was consistently failing to get first round interviews when I applied for openly listed positions. This was particularly disheartening as, on the rare instances where I did manage to get in front of funds, I typically progressed past the case study stage. I took this as proof that I did not lack the core skills funds were looking for, but that I just was not attractive enough for them to bother interviewing me. It was a humbling experience to say the least.

After around six more months of this, I chose to take more drastic measures to differentiate. In April 2018, I moved to Berlin to join infarm, an early stage vertical farming company, immediately after it announced its Series A. My primary aim was to get an insider’s view of what it was like to work in the type of company that I wanted to invest in. I was, however, definitely hopeful that working at a ‘rocket ship’ would help me stand out from the reams of banking CVs flooding the process when I planned to resume my search for a VC role in earnest.

After around a year at infarm, I restarted my search for a VC role, now equipped with my shiny new operator / banker CV. My improved resumé, however, had cost me around 50% of my interview volume. By leaving the bank I had lost most of my recruiter contacts, making it necessary to rebuild my interview flow. Part of this was done through a combination of subscribing to VC job mailing lists, stalking funds and investors on LinkedIn / Twitter to check periodically for recruiting announcements and scouring online job boards. The other part involved far more desperation, it involved cold emailing / DMing partners at new funds asking to interview (I even delivered a hand written letter once!) and asking the one VC that I was close enough to at the time if he knew if anyone was recruiting. Between January and June 2019, I managed to secure only three interviews, my curated interview pipeline did not seem to be flowing particularly well – no matter how good my newfangled CV was.

Once again it was time for a change of approach. I had cottoned on to two facts during this period. Firstly, I realised that my one VC friend knew about several roles that were not listed anywhere and secondly, I began to understand that open application processes could be and were being short circuited by warm introductions. The latter, I realised when one of the funds that I applied to during this period explicitly stated that it would look favourably on applicants with such an intro. As naïve as it sounds, it had never occurred to me to muscle my way into a first round interview at a fund via my network. This oversight was probably due to a combination of my lack of any meaningful network to leverage as well as some idealistic notions about meritocratic interview processes. I previously held the belief that if they posted it in public it was fair. In any case, it had become glaringly obvious to me that knowing VCs made it significantly easier to become one.

While I was pondering how to meet more VCs and, more importantly, how to get them willing to bat for me, the opportunity to participate in the DiversityVC’s 2019 FutureVC scheme came up. If there was any way to meet VCs and get them to vouch for you, it was doing an internship at a fund. Moreover, the fact that there were several masterclasses with investors served as an opportunity not only to learn more about the asset class but also to gain exposure to other players in the ecosystem. It was exactly what I was looking for.

There were just two problems:

  1. It was a six-week internship
  2. It was in London and I was in Berlin

Right after I had helped infarm raise its $100m Series B and had secured a promotion, was I really going to leave to do a six-week internship? Moreover, leaving would entail moving back to UK, while remaining on the hook for rent back in Berlin for last six months of the year. All this in the hope that these six weeks would help me improve my access to the job market in a sector that had consistently rejected me. At the time I felt that, if it went wrong, it would be the most expensive six weeks of my career. I managed to push these concerns to the back of my mind and applied for the program anyway, there was no point wrestling with the risk before I got an offer.

My ability to avoid coming to terms with this risk evaporated when I was offered a place on the program working with the LocalGlobe team. I am not entirely sure how I managed to overcome my fear at the time, but I bit the bullet, quit, and moved to London for the summer.

With the benefit of hindsight this was the turning point in my search, however, in late September 2019 (two months after the internship had ended) I felt otherwise. I felt lost and stupid. Following my internship in July, I had earned the opportunity to participate in the formal process for an associate position at LocalGlobe. Moreover, I managed to pick up an interview at another firm (the one I sent a handwritten letter to all the way back in April 2019). These processes spanned the two months following the internship and I was the most optimistic that I had ever been about securing a role. I had worked at a great fund, received good feedback, learnt so much about the profession both through the internship and the masterclasses and, to top it all off, even had home team advantage! When I found out that I was not going to get an offer after the final round of the LG process I was devastated.

My world unravelled and I was forced to face the fact that I had not managed to succeed despite all the chips seemingly being stacked in my favour. Unemployed for the first time in my life, I spent the next month in my Berlin apartment coming to terms with what had happened (I had moved back to Berlin as I was stuck paying rent there anyway). The LG team kindly offered to help me with my job search (references, intros etc.), but it would be a full month before I was mentally able to get back on the treadmill. It took around a month of licking my wounds for me to gain some much-needed perspective and finally acknowledge the true nature of my position. Yes, I had failed to land a role immediately, but from a venture recruiting perspective I was the best placed I had ever been. I had gained several things:

  • Much improved visibility of the job landscape
    • Via a combination of my peers on FutureVC, the DivVC team, the LG team and friends I had made along the way
  • An even more differentiated CV
    • Having worked for a venture firm unsurprisingly makes venture firms more likely to be interested in talking to you
  • An invaluable understanding of how VCs think and operate
  • Respected people who would vouch for me

Equipped with all the above I began applying for roles again. This time it was different, everything had traction to it – of the six roles I applied for between November and December 2019, I got to the first round of five processes. For someone who had spent the previous two years largely having his applications and cover letters ignored, this was revolutionary. Four of these five processes were for full time roles while the last was for another internship. In the end I got to the final round for one of the full-time roles (another painful rejection) and received an offer for the internship. I accepted this offer and, encouraged by my change in fortune, resolved to redouble my efforts to find a full-time position over the next six months.

In January 2020 I relocated again, from Berlin to Stockholm, to do the second VC internship – this time I would be spending six months at Creandum. My plan was to learn as much as possible, work hard, make connections while on the job and apply for full time roles in my free time. If I did not get a role by the end of the internship, I would put my search on hold for the foreseeable future and stop the financial bleeding (alternating between internships and unemployment is not exactly lucrative).

Five months, several case studies and more than five interview processes later, I made it. I got an offer to join the Stockholm operations of Icebreaker Ventures and I could not be more excited to start this September. Three years of country moves, foregone promotions, uncertainty and heartbreak turned out not to be for nothing. Now all I need to do is learn how to invest! 😉

Part II: What makes the junior VC job market so unforgiving?

Now that I have bored you with life story, it is time to get into the nitty gritty of what made the journey so long. There are three main factors that make junior venture roles elusive. These are: the low volume of roles; imperfect visibility / access to the available opportunities; and hyper competition for each one.

Low volume of jobs

There are not that many funds in Europe and, while this number is growing, this does not correspond to an explosion in junior roles. Venture funds generally have low headcounts, with some of the most successful funds in Europe having well under 20 employees. Low employee counts coupled with the fact that funds have equally low staff churn means that your dream fund may happily go years without recruiting a single analyst or associate. Sprinkle in the fact that funds do not need juniors (Benchmark’s investment team for example is comprised solely of partners) and you have a recipe for a dearth of analyst and associate positions.

If you are somewhat selective about where you want work, it would be a stretch to find 15 processes to apply to in any given year.

Access to job opportunities

Even though there are relatively few roles, it is not feasible to see / access all of the available ones due to structural opacity in the VC job market. Roughly speaking, fund recruitment approaches can be grouped in into three main categories: network-based, recruiter led and open. The first two of these are fundamentally untransparent.

A significant percentage of VC roles are filled through network. Unless someone you know reaches out to you about the role, you will remain oblivious to its existence until you see a new associate appear at Fund X. If you are lucky, you may hear a rumour that a fund is recruiting but will still have no direct means of applying. Here your options are to ask your network to snoop around for you (assuming you have a network!) or to try and cold email your way into the process.

Another sizeable portion of roles are filled through recruiters. In practice this works almost exactly like network-based roles, with the main differences being that you can at least make yourself known to recruiters and that they are not inherently nepotistic. Whether they care about you, however, is a different matter… My experience of recruiters has been fairly transactional, the minute they lose confidence in you or find someone shinier your flow of opportunities from this source will dry up. If you have a non-traditional background, getting a recruiter interested poses a particular challenge. Typically, they favour investment banking and management consultancy types, presumably in a bid to maximise the efficiency of their efforts. This professional services bias renders this source of opportunity flow unattainable for a large portion of prospective applicants.

Lastly there are open applications. These are by far my favourite source of opportunities in that they are the fairest. This fairness, however, comes at the price of hyper competition which I expand on below. Moreover, open applications are often only relatively fair because several funds (perhaps in an effort to lessen the administrative burden created by hyper competition) allow their processes to be short circuited via network. At its worst, this has the effect of rendering some processes faux open as the warm intros crowd out the rest of the applicants. I find this particularly frustrating as applying often requires meaningful effort. It is perverse to make people waste their evenings and weekends crafting responses and tailoring cover letters only to ultimately fill the first round of interviews with candidates from your network.

The practice of favouring warm candidates hinders diversity in VC firms. If you are filling 10 of 20 places in your first round of interviews with people from your wider network, how do you expect to make venture less homogenous?

Hyper competition

Hyper competition goes some way to explaining why processes are often so gatekept / prone to being usurped via network. Venture roles have become extremely ‘glamorous’ and, given that there are no concrete prerequisites for junior positions, receive huge numbers of applications when they are made open to the public. Anecdotally, I have heard from several funds of situations where they have had well over 500 applicants for a single role. This combined with no real way to filter CVs for anything other than ‘pedigree’ (there is no qualification for taste in startups) makes it difficult for funds to narrow down who makes it into the first round. If you are narrowing from 700 CVs to 40 first round interviews, how does one meaningfully differentiate between the 30 McKinsey consultants, the 20 investment bankers, the 15 start-up founders / operators and 20 FANG PMs?

This problem is one of the reasons why VC firms often outsource recruiting efforts to their network or headhunters rather than opening roles to the public. When they do have open applications, funds often deploy ‘coping mechanisms’ to make filtering easier. These include:

  • Long application forms which ask the candidate to answer a few questions
    • Questions range from identifying interesting startups / investment themes to waxing lyrical about the best book you have read in the last year
  • Preferring candidates with warm intros
    • A practice which unfortunately contributes to keeping venture homogenous
  • Only looking at the first N applicants – often a slow application is as good as no application

What does this mean in practice?

The long and short of the above is that the hardest stages of any VC application process are the first two. Discovering the process at all and getting to the first round. For network and recruiter-based processes discovery poses an obvious problem. For open roles getting from the application stage to a first round interview is brutal. Assuming that the average open process at a good fund receives 600 applicants and that they take 30 people to interview, that leaves you with the gargantuan task of beating out 570 people before anyone has even spoken to you. Those are tall enough odds without places in the first round of interviews being siphoned off to your better networked competitors. I would go as far as to say that once you can get first round interviews consistently (and put together a half decent case study) it becomes far more of a question of when you will get a role than if you will get one. Consequently, the advice section of this essay will largely focus on how to maximise your chances of getting to round one.

However, before we dive into advice it is important to explore one other issue which colours the entire venture recruitment process. Namely, the fact there is no objective benchmark for a candidate’s ability to do the job. Venture capitalists themselves do not know whether their own investments are performant (thus whether they are good investors) until several years into their careers. Consequently, judging whether you will be a good investor from a couple of conversations is impossible to do objectively. The most your interviewers can do is check whether you understand the intricacies of the venture business model, know their firm and its thesis and whether you can put together a coherent investment memo (which they typically do via case studies). This is not a particularly high barrier.

Once you get past the case study and into the final rounds the firm interviewing you has generally accepted that you are competent enough to do the job. So, at this point they are mainly comparing the remaining qualified candidates against each other. The lack of objective criteria often makes this a test of fit more than of skill, exposing you to the whims of chance and bias. In one final round interview, I distinctly remember talking about a video game investment thesis to a partner who unbeknownst to me had a video game tattoo which he subsequently showed me. At this point in the process, there is little you can do other than be personable and hope that you gel with your interviewers better than the others. The upshot of this ‘randomness’ at the last stages, is that you have far more influence on whether you get into the last five to ten candidates (post case study) than you have on making sure that you are the successful one. Thus, it makes the most sense to focus on the former which means making sure you discover as many relevant processes as possible and maximising your chances of getting to the first round. Tips on how to do this are discussed in the next section.

Part III: How to maximise your chances

This section contains a pragmatic approach to increasing your odds of getting a junior VC role. In practice this means that, despite my personal distaste for the outsized role network plays in these processes, building and leveraging your network is still good advice unless most VCs change their recruitment practices overnight. Moreover, while some puritans may balk at the idea of carrying out a career move for the express purpose of making your CV more attractive, I include it as a tactic in spite of how mercenary the optics look.

The advice below assumes you are in this for the long haul, some of it is rather drastic and will not necessarily pay off in the short term. None of the advice here guarantees you a role but rather it increases your chances of seeing / getting any given role. If you are not sure that you want to work in the industry most of the advice is not suitable. Do not quit your job, move to a new country, and do a VC internship because venture is the flavour of the month!

I have identified four main types of behaviours you can adopt to increase your prospects of getting a venture role. They are:

  • Boosting signal – making your CV look shinier
  • Growing your network
  • Controlling all the controllable aspects of processes
  • Identifying the low hanging fruit

Below I dive into each of the themes and provide examples of actions one can take in keeping with them. These examples are not meant to exhaustive, there are definitely many other creative methods of pursuing the above strategies, instead they are supposed to serve as inspiration.

Boost signal – CV Building

Making your CV stand out is key to getting through the application phase of VC roles. Often you need to convince funds that they want to interview you more than 500+ other people, several of whom will be extremely impressive too. Boosting signal is the first port of call for a candidate, there are so few roles available each year it is imperative that you do not burn them.

Some signal building actions you can take include acquiring hybrid experience, doing VC internships and cultivating external proof of interest in tech / startups.

Acquiring hybrid experience (normally adding start up experience)

VCs often get several CVs that look alike (remember the 30 McKinsey CVs). You can be the one consultant they decide to interview by having experience from different areas; by being a Consultant-Plus. For example, I began my careers as an investment banker and subsequently moved to Berlin to work in strategy for a startup there. I really enjoyed the experience of working inside a high growth startup, expanding from one to ten cities and helping to raise the Series B round. However, at the time of accepting the role, I was fully aware of that it would help me stand out from the countless other investment bankers who would doubtless be in the mix when I decided to begin applying for junior venture positions again in the medium term.

VC internships

VC internships are generally easier to get than full time roles especially if you are an experienced hire. This heightened access to internships in conjunction with the fact that funds will generally interpret your internship at another fund extremely positively, makes them invaluable for breaking away from the herd of CVs. Consequently, while becoming an intern four years into your career may feel terrible for your ego and even worse for your pocket it can pay dividends as you continue your job search.

I personally did two internships before I secured a full time Venture Role. There is some privilege inherent in this, internships can be extremely disruptive for one’s near term career and earnings. This makes this strategy highly irresponsible if you have dependants and do not have the means to weather a spell of unemployment in the aftermath.  As a result of my first internship I spent August 2019 to January 2020 in career limbo, having been unable to secure a full-time role immediately following it.

It is also worth noting that the above description does not account for some of the other benefits of VC internships, including an insider understanding of the asset class which will shine through in future interviews as well as access to a network of VCs willing to vouch for you, refer unlisted job opportunities to you and provide warm introductions.

Cultivate niches that prove interest in startups / tech

This is the vaguest of the tips here but in a nutshell, it is all about proving that you are interested in the ecosystem. One way to do this is create content which displays your interest that is visible to the public. From podcasts and videos to blogs and newsletters, there are a variety of media you can leverage to signal that you have more than a passing interest in the ecosystem you are going into.

I started a blog where I wrote some markedly average theses about video game tech. I never got to the post cadence I would have liked to have reached or achieved coveted ‘thought leader’ status, however, I could put a link to my blog on my CV and have had multiple interviews where the interviewers referenced my half-baked musings.

Growing your network

Littered through the above essay are references to how network interacts with the VC job market. Being well networked helps you see the opportunities that are not made public, have someone to vouch for you when firms reference you and (most problematically) can fast track you to the interview stage for some processes. This has obvious negative implications for diversity efforts in the sector. Consequently, I hope that recruitment processes become less prone to this kind of influence and must applaud the few firms that I have seen deliberately design processes to limit network’s power.

That being said, I would not hold my breath for widespread change in the near future – and thus would encourage any prospective candidate to build their network if they are serious about maximising their chances. Practical things you can do to build your VC network include:

  • Attending and participating in events – the more intimate the better
  • Join support groups e.g. YSYS
  • Internships
  • Helping founders and other people in the ecosystem
  • Access schemes like FutureVC and IncludedVC

Things to think about when networking are depth versus breadth of relationships. While having a wide network is helpful, having deeper relationships is important when you are asking someone to lend you their credibility. Depth in these relationships is best built by working with the person, another plus for VC internships, but helping others with no expectation of return goes a long way (e.g. referring interesting companies to an investor / helping a founder with her pitch deck). People will generally see through it if you are purely transactional.

Making sure that your network knows you are in the market for a role is very important when it comes to discovering job opportunities. You want to be front of mind when your contact hears rumours about a position at fund X. Because there are so few roles and because they are so hard to discover, the more people who know about your search the better. It does not matter that you are embarrassed that you have been very publicly searching for over a year – it is better to be slightly embarrassed and seeing opportunities than to retain your pride and search for another year!

Control what you can

Venture processes are scarce and are difficult to control. Especially once you are in the last stages of a process, things often become rather subjective. Given the scarcity, it is imperative to control all the controllable parts of the process. Normally these are the quality of your application (the thing that goes alongside your CV), the speed of your application and lastly the quality of your case study (if it is take home). It is better to overdo it and get through than do the minimum and lose one of your 10 interview opportunities that year.

High effort applications

In short, put a lot of effort into the written part of the applications be that in Q&A format or cover letter. I normally spend at least four hours on an application – if I am very motivated, I can spend a decent portion of a weekend tweaking and tailoring my responses. It helps to be organised – VCs often ask similar questions, thus once you have carefully crafted an answer for one process save it for use in future applications. This type of preparation will help you apply earlier which can improve your chances of getting an interview. Here is a link to some of my historical answers and cover letters.

Apply early

As VCs often get flooded with candidates, the sooner you apply the more likely you are to avoid any artificial cut off periods. This obviously needs to be balanced with the quality of the application, but I would not advise spending an extra week fine tuning it once it has reached reasonable quality. In that week, a few hundred CVs may get in between you and your dream job.

Overperform on case studies

If you have a take home case study just overdo it. There are so few roles you do not want to risk failing here because you wanted to do the minimum. I have included some examples of case studies that have got me through to the next round before here.

Find low hanging fruit

Lastly it can be extremely effective to pro-actively identify processes that will inherently be less competitive. One way to do so is to pre-emptively apply to funds that you think will need to recruit soon. Most new funds fall into this category as they often announce their fund closing before they have filled any junior positions. In this type of situation, a well written cover letter with your CV attached can net you an interview where it would not normally. I have secured at least four interviews by proactively reaching out to these new funds and asking if they are recruiting. Because these roles are not being actively filled, these processes are generally a lot less competitive than formal ones significantly increasing your chances of getting to the later stages. On the other hand, there is often a lot less urgency and structure than in formal processes.

Conclusion

The European Venture job landscape is bleak and breaking in can often require a significant amount of perseverance. The aim of this essay has been to document my journey, describe the lay of the land and finally provide some advice to prospective candidates that will hopefully shorten their searches. It would be disingenuous for me to pretend that the landscape is not discouraging, however, at least there are some actions that I have found can be helpful for candidates contemplating a transition into VC and willing to sacrifice to get there.

Below I have included a list of resources that may be useful in your search as well as thank yous to the dozens of people who helped me and kept me sane along the way.

Resources

Job mailing lists

Application docs

Books on venture

  • Secrets of Sand Hill Road by Scott Kupor
  • Venture Deals by Brad Feld and Jason A. Mendelson

Access schemes

Thank yous – this section is self-indulgent

Organisations

Creandum – to the whole team for an amazing six months of learning and support and for taking a chance on me

  • Staffan, Simon, Carl and Johan – for leaving no stone unturned during my search
  • Fredrik – for teaching me so much about venture
  • Sanna – for being an amazing support before and during COVID and making sure I settled into Stockholm
  • Beata – For being my first friend in Stockholm and putting up with my nonsense

LocalGlobe to the whole team for the best introduction to European Seed that one could wish for and for taking a chance on me

  • Mish, Julia and Remus – for continued support, advice and encouragement post the internship and for lending me your hard-earned credibility
  • Suzanne – for taking me under your wing during the internship
  • Ophelia – For the being the friend I made under the strangest of circumstances and a breath of fresh air

Diversity VC – For FutureVC 2019, the program which completely changed my trajectory in June 2019

  • Check Warner – For everything you do for people like me and specifically for telling me to keep going last summer
  • Seb Butt – For coordinating such an amazing program
  • Harry Briggs – For the support and the kindest rejection email that I have ever got
  • Michael Tefula – For the continual support and being the first warm intro, I received in my entire life

VCs who had no reason to help me but did anyway

Martin Janicki, Esther Delignat-Lavaud Rodríguez, Dele Akin, Aurelia Hummelbrunner, Ricardo Sequerra

Friends – for keeping me sane at the lowest points in this three-year journey

Alex, Temitayo, Ophelia, Rumbi, Kieran, Damon, Asia, Alice, Dan, Ryan, Chris, Annalisa, Adam and Isaiah

Theory of Grime | Distribution: How Pirate Radio shaped the characteristics of early Grime

In an otherwise unremarkable evening in the early 2000s, several men and women pour into a small room at the top of a council block in East London. These men and women, predominantly Londoners of Afro-Carribean origin, are seemingly drawn to this rooftop like bees to nectar. Some enter the room and do the rounds, emphatically greeting their peers, others slip in discreetly and take up their positions at the back or in the corners. They’re here for the music – that’s the nectar. 

This box room on top of a tower block in Stratford City, where the Olympic Park now stands is the site of Deja Vu FM – alongside Rinse FM one of the most important locations in the formation and crystallisation of Grime music. Over the course of the hour MCs and hangers on stream into this secret location responding to the call to arms being broadcasted over the London airways – in early Grime proximity was everything. By the end of the hour the room is filled with a Mercury Prize winner, an MBE holder, a convicted murderer, club promoters, a cameraman, several of the most influential artists Grime music’s history alongside numerous MCs that have since faded into obscurity. 

In the traditional telling of this story, the focus is for obvious reasons on two parties in particular, the Mercury Prize winner and the convicted murderer, Dizzee Rascal and Crazy Titch respectively. This is largely because the shoving match that they get into at the end of the hour happened to be captured by A Plus (the cameraman) and immortalised in DVD form. This combined with the musical back and forth that ensued in the following weeks so captured the imagination of London’s urban population – that Dizzee’s aggravated refrain ‘I’m not a Mook!’ is still relevant enough to be referenced in Skepta’s 2019 album – over 15 years later! However, here we’re not concerned with the 5 minutes of conflict at the end of the DVD but rather the questions that the whole hour raises about the early Grime scene. What motivated all of these people to answer the siren call of the radio station? Why were they willing to risk going to areas where their enemies were? How did it all work and who was making money? Why did so many of these events end in conflict? What changed? 

I’m going to try to answer some of these questions over the course of a few posts using a mixture of primary sources – including radio sets, song lyrics, books, street DVDs and publically available interviews with stakeholders within the scene. In general not many books have been written on Grime and those that have been do not really touch on the incentives underpinning the early scene. I believe that the incentive structure present at Grime’s inception created and shaped some of the features that make it such a unique and admittedly strange genre. This series is my attempt to better understand what exactly formed some of the distinguishing features of a genre that I love, this post will focus on how the scarcity of distribution (i.e. the lack of mainstream radio play and the limitations of Pirate Radio) shaped Grime culture.

Context – Emergence of an underground genre

To understand distribution scarcity in Grime we need to first understand the context from which it emerged. Grime is by definition an underground genre albeit one that has had moments where it has captured significant mainstream attention. Especially in the early 2000s, this meant that none of the music released had more than a remote chance of getting played on national radio, notwithstanding the breakout successes of More Fire Crew, Lethal B, Kano and Dizzee Rascal. While this post is not intended to be a history of Grime, it’s sonic roots have been significantly discussed elsewhere, some of the musical influences informing early grime are important to any meaningful discussion about the characteristics of the early scene. Sonically and culturally Grime can be seen as the result of various musical cultures and influences fusing:

 

  • UK Garage – From an instrumentation perspective Grime is a Genre that evolved out of Garage (an electronic music genre). The transition began in the early 2000s as a crop of Garage crews (most famously the Heartless Crew, the So Solid Crew and the Pay as You Go Cartel) began experimenting at the boundaries of the genre
    • Traditional UK Garage was light-hearted, euphoric, party music. It featured instrumentals that were light in tone and often contained vocal layering, it had a celebratory feel, the fanbase was DJ focused, and the MCs acted as hosts introducing the music, hyping the crowds and getting out of the way.
    • In the early 2000s there was a schism in Garage and crews above began to shift the the sonic template of the Genre. MCs, many of whom were refugees from the earlier Jungle scene) began to innovate incorporating increasingly complex rhymes and rhyme schemes into their sets. DJs began accommodating for this selecting more ‘open’ riddims (instrumentals) which provided room for MCs to perform uninterrupted by backing vocals. Producers began changing the tone of their instrumentals (though importantly preserving the speed) making it darker in a seeming bid to reflect the content that the MCs were rapping about – this shift in tone led to Grime (at this point an unnamed genre) sometimes being called Darker Garage.
    • To illustrate just how important the transition from Garage to early Grime was one can just look at the legacy of the Pay as You Go Cartel. While strictly speaking a Garage Crew, its members seeded many of the dominant Grime Crews in the early period spawning Special Delivery, Mucky Wolfpack and most importantly Roll Deep while being involved in East Connection and the Musketeers. Almost all of the early Grime artists came out of the Garage scene and most of them were acutely aware of the schism occurring, indeed Wiley’s first single ‘Wot U Call It’ (referring to the so far unnamed genre) is a comment on the split itself – In the song’s own words ‘I’ve heard they dont like me in Garage // Cos I used their scene to make our own sound’
  • Jungle
    • Many of the MCs and DJs that founded Grime in the transition era were former Jungle artists who had transitioned to Garage for a combination of reasons. These included the Garage’s rise in popularity in the late 90s, Jungle being a semi closed shop where the most popular artists kept newcomers away from the main stations and events, and lastly because Jungle itself began a sonic transition to Drum and Bass losing a lot of it’s more melodic aspects
    • These MCs entered the Garage scene with Jungle mindsets, meaning that they came with more complex rhymes and schemes as well as grittier content
    • It is in part the prevalence of these Jungle refugees that helped create the darker, grittier and more lyrically inclined subgenre of Garage that eventually evolved into Grime – one of the key features imported included prevalence of MCs rapping in Patois (Carribean Slang)
  • Dancehall – A high proportion of early Grime artists were of Carribean descent and consequently the influence of Dancehall and soundsystem culture permeates through the genre providing the blueprint for behaviours including
    • The prevalence of soundclashes – these are clearly imported from Dancehall events such as Sting
    • The importance of reloads (or forwards) – where the DJ restarts the song or instrumental to dissipate excitement / tension in the crowd
    • The idea of cutting multiple versions of the same song – where several different MCs would record vocals over the same instrumental making their own individual versions of the song which would then be sold via specialist record stores
      • In 2003 for example Wiley released 2 4-song EPs for the Ice Rink instrumental providing vocal mixes from 8 different artists (EP1 and EP2)
  • Hip Hop – though its influence is less direct than the other genres already mentioned, you can tell that the majority of Grime artists were Hip Hop listeners. And that, despite the tempo being faster – the lyrics, rhyming patterns, instrumentals and even the clothes the artists wore all provide clear evidence of Hip Hop’s influence. For example
    • Skepta’s legendary ‘Serious Thugs’ instrumental is a Grime remix of Hip Hop Group Bone Thugs n Harmony’s song  ‘Thuggish Ruggish Bone
    • In a Sidewinder Studio Set you can hear the Meridian Crew (JME and Skeptas’ initial crew) MCing over instrumentals from the Harlem Hip Hop group The Diplomats
    • There is even a Dizzee Rascal radio set where you can hear him mimic the flow of and interpolate lyrics from now deceased New Orleans rapper Soulja Slim’s song Soulja 4 Life – just compare this (Soulja Slim) with this (Dizzee Rascal)

 

What is most important when thinking about the spread of Grime, however, is its evolution from UK Garage and Jungle and it’s inheritance of these genres’ distribution methods. In the late 1990s to the early 2000s, Garage was a genre which straddled the underground and mainstream. The elements of it that evolved into Grime were largely on the underground side (i.e. less Craig David more So Solid Crew), and this meant that like Grime they had limited to no legal radio play whatsoever – it meant reliance on Pirate Radio.

Understanding Pirate Radio

Pirate Radio is perhaps the most important part of the Grime distribution puzzle. These illegal stations acted as the primary distribution channel for the music, and thus the music to an extent was shaped by their features and limitations. Pirate Radio stations were inferior to traditional ones in several ways:

  • The equipment was usually makeshift and thus low quality – reducing the clarity of the sound
  • They were limited in range and thus the core audiences were necessarily hyperlocal
  • The equipment was regularly taken down by the DTI a government body in charge of policing the airwaves
  • They were funded without advertising, but instead by the MCs and DJs themselves who paid subs for the right to be on air using the Pirate’s facilities
    • Radio stations would also make money through hosting events. Deja Vu FM for example had the Young Man Standing series of raves – these were often promoted on air by having a special Young Man Standing radio set featuring an all star cast of MCs, many of whom would be booked at the actual event in the evening
    • Deja Vu itself was at one point located inside Club EQ in Stratford and was operated by the club’s management.
  • It was impossible to measure the audience sizes on a Pirate
    • That being said, many stations did have a mobile phone number which was used a way of allowing audience interaction. While they were live, listeners would deliberately force a missed call to show their excitement as well as texting in encouragement, abuse and shoutouts to the artists 
  • Perhaps most importantly to Grime culture, Pirates were illegal meaning that disputes where handled in an ad hoc way
    • Power generally accrued to those with the most physical force behind them

However Pirates did present some advantages / unique innovations:

  • The programming was completely live and the DJ’s were able to mix freely leading to a much more club like atmosphere
  • There was little censorship
  • The geographic limitations of the broadcasting equipment necessarily created a local feel to the content – with the MCs and crews being local celebrities
  • The inability to gauge audience size unlocked more artistic freedom and experimentation – as well as encouraged more risk taking behaviours such as clashing

These factors all coalesced making the Pirates a hivebed for musical creativity, a petri dish for early Grime. What the features of this distribution channel did to the culture of the genre and behaviour of the participants, however, is a whole different story. 

While the Pirates were geographically limited in scope, they were still the only musical outlet for aspiring underground musicians across the UK’s ‘Urban’ areas. Thus there was always a queue of people waiting to take your slot on the radio station if you weren’t there. This was the era just before illegal music piracy became mainstream, before streaming services allowed an artist to publish a song and have it available everywhere, before social media was a viable method of attracting or informing fans. Thus the artists turned to the only outlets they had, their hyper local radio stations and even paid for the privilege to do so.

Having a slot on a popular Pirate was the lifeblood of a successful Grime artist’s career. Despite having to pay money to be there, it was the only advertising channel available to an artist and unlocked the limited economic opportunities that were in Grime (namely show bookings and vinyl sales) therefore the various artists were willing to do so (or try to sneak in without paying). Pirates were the predominant means of marketing for the artists, both to consumers and to show bookers. 

The strength of the desire to be on a Pirate is illustrated in the song ‘1999’ by Grime crew Ruff Sqwad – in which Shifty Rydoz mentions paying £5 each time he went to Heat FM in the year 2000. On the surface this seems like a run of the mill anecdote, but there are several factors that make it remarkable. Firstly, assuming Shifty is the same age as crewmate Tinchy Stryder, this means that he would have been 12-13 in 2000. Secondly, assuming he had 1 radio slot per week, that equates to £260 in subs a year for that station alone. Thirdly, getting to the radio was not easy, Heat was in Tottenham (North London) and the Ruff Sqwad members lived in Bow (East London) a 50+ minute commute away. Assuming £2 a week on travel (London buses weren’t free for under 16s until 2005) he would have spent ~£100 a year just to get there. Lastly, it was materially dangerous, being ‘caught slipping’ in deprived parts of London that you were not from. MCs ran a real risk of being robbed or worse on their way to and from the stations – Heat FM specifically has been described as a ‘death trap’ as there was only one bus route in and out of the area. The fact that 12-13 year old aspiring musicians were willing to spend £350+ a year, to cross London and in a real sense to risk their safety to be on Pirates illustrates just how core it was to unlocking the opportunities in the scene.

Grime artists were clearly at a minimum subconsciously aware of this and there are a number of behaviours and tactics they adopted to maximise the amount of radio time they had as well as its marketing impact. If you listen to old Grime radio sets the telltale signs are everywhere, with tactics employed including:

  • Forming crews
  • Set crashing
  • Fighting over the microphone
  • ‘Warring’

I’m going to try to unpack the underlying logic behind these various tactics below.

Forming Crews

In the early era of Grime almost all of the artists were part of a crew, given that at present most of the active artists are crewless, it’s clear that something about the structure of the scene changed making crews obsolete.

The most obvious reason for the existence of crews was maximising attention from any given slot on the radio. You may not have heard of Trim but you might be a massive fan of Wiley so in the end you tune in to the Roll Deep set and end up leaving a fan of both. If Trim had been on his own you may not have listened at all. Now couple this with the fact that many of the artists had individual fanbases and followings from before they joined their crews and it’s clear that crews were an obvious way for artists to cross pollinate each other’s fanbases. Grime artists were essentially bundling together several different styles to give their radio slots the maximum appeal.

This, however, does not on its own explain why crews have all but disappeared, as there is nothing to suggest that the cross pollination effect of crews should no longer persist. What, however, has changed is the fact that consumers now have an unprecedented amount of choice in what they can listen to. This combined with the reality that artists now have global reach thanks to the internet eliminates the scarcity of audiences that necessitated crews. In 2004 if you wanted to listen to Trim, you could try to buy a dubplate (a vinyl record) from a specialty record store (if you were lucky enough to live close enough to one) or you could tune into the Roll Deep Show on Rinse FM and hope he was on, and that would only work if you were close enough to East London to tune in to Rinse. Nowadays you can listen to Trim’s whole catalogue on Spotify whenever and wherever you want to – no more need to try to catch him plus whoever he happens to be with on a Pirate.

From Trim’s perspective his reach is also far wider than in 2004. With the internet Trim is able to amass and reach an international fanbase without the approval of a major record label or the need for mainstream radio play. In 2019 Trim can reach all of the people who might like his music on his own. There is no need for Trim to piggyback on Wiley’s popularity to reach new fans (or vice versa), not with the ability to reach every possible Trim fan worldwide. Hence the internet killed the Grime crew.

It must be noted that crews served other purposes, for example they also provided protection both physically (in the case of set crashings and violence) and figuratively (in lyrical warfare) – there’s safety in numbers. Trim from Roll Deep famously left the crew claiming that a fellow member failed to back him during a physical altercation – the crew no longer served its purpose so there was no need to remain in it. However, the key takeaway here is that crews were largely a marketing device used by artists to amplify their reach in an era of limited distribution.

Set crashing

Different DJs and crews had ownership of certain time slots in a Pirate Radio station’s programming (the legendary Nasty Crew, for example, held the Monday 8-10pm slot on Deja Vu FM). Consequently, MCs who were not invited to a particular time slot would often turn up to the radio during another group’s set and force their way onto the microphone, through any combination of clout, fear and friendship. In a 2016 interview early Grime MC Stamina Boy’s cavalier explanation of how he used to crash sets demonstrates how just normalised it was – You could be out doing whatever… you turn the radio on… [and realise someones] on Deja Vu… you [would then] just roll [and] jump on the set’. When talking about the motivations for doing this he says, ‘When I had my proper following… that’s what it developed from, the crashing of sets’. These were artists who were just trying to be heard – so they could sell their music or get booked. 

From the listener’s perspective set crashing was amazing. Every set was a variety show of sorts. You would have the staple crew who you had tuned in to listen to, plus the added mystery of who else would turn up, both invited or uninvited guests. This kept sets from getting stale and kept people tuning in to hear novel combinations of artists going back to back. Tuning in and hearing all of your favourites together was a real possibility despite them not being in the same crews. Moreover, given the competitive dynamics of Grime, set crashing opened up the possibility of spontaneous clashes emerging, where a ‘warring’ MC would turn up to another’s set unannounced to clash them. Examples of this involve Trim turning up to former crew mate Flowdan’s set and clashing him in January 2008 (after being called out on air for the best part of 40 mins) as well as Wiley doing the same to Trim almost 2 years later. With occurrences like these, the listener really had an incentive to tune in to the radio – you didn’t want to miss a thing.

The prevalence of set crashing made being part of a crew all the more important. This is another reason why almost all of the artists were part of crews – there was safety in numbers both when you’re crashing a set and when your set is being crashed. A famous example of a hijacking gone wrong is when the Musketeers, a lesser known crew attempted to force their way onto an East Connection Set on Deja Vu Fm – the end result of this attempt was a set of broken DJ decks, 2 bricks in the East Connection DJ’s car window and most damningly the entire Grime scene being banned from the Pirate Radio station.

Set crashing was a key way for an artist to be everywhere and being everywhere meant more sales and more bookings. Instead of being on the radio for 2 hours a week you could be on as long as the radio was on, and with no recourse to law enforcement this tool turned into a free for all. In the long run Grime artists’ incentives to set crash were unsustainable and did damage to the scene as a whole despite helping the individual perpetrators. 

In 2003 for example, MCs got banned from Rinse FM for regularly turning up in droves. In a 2014 interview DJ Geneeus, one of Rinse’s founders stated “The MCs just kept turning up. I’d arrive and there’d be 20 people in there. I knew we’d either get caught or someone was going to do something bad to someone else.” This was surprisingly prescient as just a few weeks later the fight between Crazy Titch and Dizzee Rascal mentioned earlier erupted on the rooftop at Deja Vu FM. According to Sharky Major, he and Titch were sitting at home listening to Deja Vu, heard what sounded like an interesting set and immediately headed over to Stratford to participate, at the time Titch had just come out of jail and wanted to build his name. In 2007, MCs were banned from Rinse again for similar reasons, one rumored incident preceding this second ban involved DJ Spooky of the Slew Dem Crew kicking down the door of the station in a bid to gain entry after having been denied it.

Set crashing as a behaviour, though perfectly rational, ultimately destroyed Grime Artists’ core marketing channel at the time. What is particularly tragic is that Pirate Radio being the core route to market, was the very reason why Grime artists were incentivised to ruin it. Set crashing as a phenomenon is a very interesting case of the tragedy of the commons – individuals acting in their own interests essentially destroyed the utility of radio for their entire class of users. This loss of radio access, first Deja Vu then Rinse, was one of the key factors contributing to the rapid decline of Grime from prominence in the late 2000s. 

Fighting over the microphone

This dynamic is most obvious in the few videos there are of the early scene – as MCs are performing you can often see more than 3 hands grasping at the microphone, with some even securing a light hold on it in an attempt to ensure that it goes to them next. In the first Young Man Standing all-star set you can hear the whole room shouting at Big Narstie for holding onto the mic for 3 entire minutes and vowing to not pass him the mic again – less than 10 minutes later you hear Narstie again microphone in hand (albeit for a much shorter length of time). The purpose of all this jockeying for the mic is summarised so clearly by an exasperated Remerdee (a member of Essentials a lesser known crew from South East London) over an hour later, who, after winning a tug of war over the microphone exclaims, “It’s not fair! Nah nah nah! We need to spit now blood! You lot are big already! You lot are big already! You’re big already! Let us spit! Let us spit! Let the new ones spit!” before launching into a flurry of lyrics.

Being on the radio was the route out of invisibility for these artists, it was how they sold their vinyls, got booked for shows and maybe even an album deal. Therefore to an MC – not much could be worse than crossing London, going through areas that are dangerous to you, paying subs and getting within reach of the microphone that could make you famous but then failing to perform. That being said, surprisingly few of these tug of wars resulted in any escalation of conflict but when they did they could be explosive. The incident captured in the DVD mentioned at the start ostensibly was caused by Crazy Titch refusing to pass Dizzee Rascal the microphone on time and Dizzee Rascal pushing him as a result.

Warring

‘Warring’ can be broken down into 2 main activities ‘sending’ and its cousin ‘clashing’. These represent 2 sides of the same coin and both remain a prominent feature of the Grime scene.

‘Sending’ or ‘Slewing’ is the process of calling someone out (usually another musician) or insulting someone. In this instance I am using it to refer to the act of doing it to someone who isn’t present and thus cannot respond in real time – though in reality a lot of the terms blend into one another. Sends are normally delivered live over the radio or as a recorded song (often called a war dub). 

Clashes, on the other hand, are not dissimilar to a rap battles. As opposed to sending, for a clash to occur both parties need to be present. They then proceed to perform lyrics aimed at each other back to back essentially in a bid to outclass the other performer – in most cases it is difficult to tell who actually won. Clashes often came after multiple instances of both sides sending for each other, ostensibly serving as a way of deciding who is better. That being said, several notable clashes have happened spontaneously (e.g. the Ghetto vs Nappa clash in first Young Man Standing radio set) while others occurred solely for sport (this is the premise of the Lord of the Mics series).

While competitive outlets exist in other genres such as rap (which has a rich history of diss tracks and battles), what is remarkable about the early Grime scene is the sheer frequency of wars. The artists were at war so often and with so many people that it has to be concluded that more often than not they were artificially looking for conflict. Examples of ridiculous pretexts for wars include:

    • Wiley vs. Dirty Doogz over Wiley ‘using/stealing’ the word ‘again’
    • Wiley vs. Lethal B over Wiley ‘using/stealing’ the word ‘roads’
    • Various MCs calling each other untalented (in less polite words) with little to no provocation
    • Wiley vs. the entire Movement Crew apparently because they didn’t let him join

Moreover the prevalence of crews increased the surface area of these conflicts. Often MCs uninvolved in the root war entered the fray on behalf of their crew mates leading to wider scale inter-crew battles.

This is not to say that all conflict in Grime was unserious or manufactured. Despite the incident that precipitated the ‘War’ being trivial, the actions of the warring parties would at times escalate tensions to the point of violence. There are enough reports of people getting stabbed, beaten up, dangled off buildings and shot at over war to give one pause.

It is hard to overstate how much ‘war’ was a feature of Grime sets from the early era. The combination of sending and clashing served 2 purposes for the participants. The former, by not requiring one’s target’s physical presence was possible to do constantly, especially given Pirate Radio’s lack of censorship. This combined with the fact that conflict and drama are huge drivers of engagement (just see Donald Trump’s Twitter feed for proof) essentially turned Grime radio into Eastenders. The artists were fully complicit in this – in a 2016 interview founding member of Nasty Crew Sharky Major states that Wiley had made it known (amongst the MCs) that he was trying to make the scene more interesting for the listeners through lyrical conflict and he was more than willing to instigate conflict with or without the consent of his opponents (though he would often phone them post-instigation to inform them that it wasn’t personal). As stated in Wiley’s own lyrics he was ‘looking for the top boys in every crew’.

MCs sent frequently, reacting to the most minor infractions and colluding to manufacture ‘wars’, because in this era all publicity was good publicity. Less known MCs would often ‘send’ for more prominent MCs, the ‘Top Boys’, to try to earn a response from them and boost their profile. Sharky Major, for example recalls Ghetts (formerly Ghetto) calling him from jail in 2003 asking who he needed to send for upon release to get his name bigger – it apparently worked because by to 2007 after wars with Flirta D, Wiley and Skepta he was indisputably one of the biggest artists in the scene and had released 2 albums. 

Sending involved MCs going to the Pirate station to call people donuts, snitches and much worse, to insult their target’s friends and family and to broadcast malicious rumours about their opponent. At its best all of this was done with remarkable inventivity, wit and using the medium of music and rhyme. In this era the MCs were extremely productive and would ostensibly spend every minute they weren’t on the mic coming up with new ways to assassinate their chosen enemy’s character.They had to because they could be sure that their opponent was at home doing the same. What, however, added even more electricity to the music emanating from these seemingly petty conflicts was how dangerous it could be. While the starting point of the conflict was often trivial, a lot of the lyrics used were not and it was not uncommon for the act of war to create actual animosity between MCs. This angst combined with both the lack of legal recourse available and the fact that an MC’s opponent knew exactly where they were broadcasting the slander from added a palpable risk to the act. Sending was not boring to tune into because there was a real sense of risk – artists were essentially trading their safety for notoriety. Something that Wiley found out when he got assaulted live on Rinse FM in 2006 having spent the best part of an hour slandering God Gift over the airwaves

Clashing meanwhile created some of the most memorable moments in Grime. It is many of these moments that were taped live and recirculated widely enough that they are still making their way onto the internet to this day more than a decade later. If sending is the trash talking before a boxing match, clashing is the fight itself. An analogy proven out in the very existence of the Lord of the Mics DVD (LOTM) series. You can view LOTM as a pay per view Grime event that has lifted its monetisation model from boxing, the artists even do promo runs before the DVD release to try and generate buzz for their clashes.

Grime artists and promoters were acutely aware of the draw of clashes and consequently held several of them at raves instead of on the radio. The artists essentially would send to promote the clash and then have the clash at a show to ensure it sold out and provide additional entertainment on the night. They were clearly monetising their conflict. For example, one of the first Grime clashes, Wiley vs Dirty Goodz occurred at Wiley’s first Eskimodance rave in 2002 after weeks of buildup on the radio. Thankfully this clash was recorded and widely distributed on a tapepack, but there are countless others that occured in clubs and radio sets across the 2000s that are completely lost to history. Perhaps this last point is why MCs were so willing to clash, there were limited long term consequences for losing unless you happened to be recorded. 

Rounding up

Over the course of this post we’ve seen that many of the features that differentiate Grime did not come into being randomly. Instead they are a result of the early scene’s incentive structure, which was largely shaped by the dominance of Pirate Radio. This reliance on a few Radio stations created scarcity and this scarcity created a form of hypercompetition for both space on the Pirates and publicity from each radio set as artists tried to generate the attention needed to unlock monetary opportunities. This meant that not only were they incentivised to pay for the privilege of being on the radio but they were willing to do much more. From engaging in several manufactured ‘lyrical wars’ simultaneously, to crossing London to hijack radio sets in hostile areas, to forming crews for a mixture of mutual promotion and self-defence, Grime in its nascent faze was the product of its environment. Its environment was Pirate Radio and Pirate Radio was scarce.

Learning from Neek Capital & Opening the Second Cohort

In April this year, I launched Neek Capital, a pro bono service offering free advice aimed at Black founders of early stage businesses in the UK. The experience has been instructive both in its successes and its failings – I will be using these to evolve the service reflecting what I’ve learnt so far. The 2 main findings are as follows.

Finding 1: One month is not long enough to have a significant impact

  • Juggling the help I was offering with my own full time employment and the schedules of founders proved challenging
  • It took a month in total to create a strong enough mental picture of the business to comfortably be able to provide advice
  • In the end I spent 3 months working with the first startup selected (May – end of July) rather than working with 3 startups in 3 months
  • Solution: From now on I will take companies on for a 3 month period

Finding 2: Lots of action is not necessarily correlated to maximum impact

  • One of the first things I did for the company I helped was build a crude operating model (we can put this down to ex Investment Banking bias….)
  • I quickly realised a few things
    • At this stage the business model was not well defined enough for the model to provide any meaningful clarity
    • Although creating the model felt good and was of some use – I wasn’t fully equipping the founders with the skills to maintain this model
  • I felt that walking the founders through the thought process behind the model and (thus the business) across multiple calls was much more helpful
    • i.e. prompting them to think about how different aspects of their businesses were interlinked and about the relationship between revenue and costs
  • Also more useful than the modelling process was helping the founders craft the narrative that they planned to present investors and define what they thought made their business unique
  • Solution: Focus from day 1 on strategic questions and skills that can persist without my presence in the future – modelling may form part of this process but is not obligatory

The revamped program

In all I have really enjoyed working on Neek Capital for the past 3 months and am looking to begin working with another promising startup. In this light I am re-opening the application process – for which you can see the details below.

What is Neek Capital:

Neek Capital is a service primarily aimed at UK Black Founders in the early stage (seed or pre-seed for now). I am undertaking to provide my services / advice for free to 1 founder/company for 3 months every 3 months to help in the areas of strategy and finance (note NOT accounting).

My experience:

I have extensive experience in the world of finance, fundraising and strategy. I spent 3 years working as and Investment Banker and have spent the last year working in Business Strategy for a high growth startup. These are skills I believe are of great use to early stage founders who may not have the knowhow to put together a model, or a pitch deck or even evaluate their business plan in a rigorous / objective way.

How to apply:

  • Every 3 months I will open applications to the general public and receive applications for help
  • Application should be sent to me via email at neekcapital@gmail.com
  • Applications will contain
    1. Business description: Including if relevant
      1. Name
      2. Number of founders
      3. Funding raised
      4. Product / market description
      5. Thesis – Why you think the business will work
    2. Description of the type of help requested
      1. Specific requests are good
      2. Please keep these within the areas of Strategy and Finance examples include:
        1. Help putting together business plan
        2. Help making an early financial model
        3. Help determining the size of the market
        4. Help looking into go to market strategy
        5. Help making materials for a fundraise
        6. Help choosing which investors to reach out to
  • I will decide which founder I am helping and communicate with the other founders who I unfortunately won’t be able to work with
  • Please note that all help will be provided in partnership with the business founder
    • At the end of the day it is your business and I will need your input over the course of the months to make something useful and tailor it your needs

Applications are open now! I hope to decide which founding team I will be helping by September 8, so please send them in.

Transforming AGOV & introducing Neek Capital

As some of you have doubtless noticed, I haven’t posted in a while. Over the past 2 years I came to the sad realisation that I had become far too removed from the world of video games to talk about them with the level of insight that I deem satisfactory for publication. It transpires that given the pressures of my life and my other goals I just do not play games or read about them enough to generate a steady stream of topics for me to populate a blog with.

Consequently, I have decided to shift the focus of the blog to my wider interests. It will ultimately be more general, however, the lens through which I view things will likely remain grounded in business strategy and finance (it’s all i know!). Currently my interests are primarily Grime music, startups, touch rugby and bouldering – and given that the latter 2 aren’t really suited to business analysis I will likely be blogging about the first 2 going forward. I have some pretty interesting ideas about Grime in particular which I would love to unpack.

I am also taking the opportunity to launch a new project. As it stands I have extensive experience in the world of finance, fundraising and strategy. I spent 3 years working as and Investment Banker and have spent the last year working in Business Strategy for a high growth startup. These are skills I believe are of great use to early stage founders who may not have the knowhow to put together a model, or a pitch deck or even evaluate their business plan in a rigorous / objective way. Therefore I am launching Neek Capital – a service primarily aimed at UK Black Founders in the early stage (seed or pre-seed for now). I am undertaking to provide my services / advice for free to 1 founder/company a month to help in the areas of strategy and finance (note NOT accounting).

Note the frequency may change once we start I will get a better idea of how much work it is

How it works:

  • Every month I will open applications to the general public and receive applications for help the can send the application via email to neekcapital@gmail.com
  • Applications will contain
    1. Business description: Including if relevant
      1. Name
      2. Number of founders
      3. Funding raised
      4. Product / market description
      5. Thesis – Why you think the business will work
    2. Description of the type of help requested
      1. Specific requests are good
      2. Please keep these within the areas of Strategy and Finance examples include:
        1. Help putting together business plan
        2. Help making an early financial model
        3. Help determining the size of the market
        4. Help looking into go to market strategy
        5. Help making materials for a fundraise
        6. Help choosing which investors to reach out to
  • I will decide which founder I am helping and communicate with the other founders who I unfortunately won’t be working with that month
  • One month later I will re-open applications
  • Please note that all help will be provided in partnership with the business founder
    • At the end of the day it is your business and I will need your input over the course of the month to make something useful and tailor it your needs

What’s in it for me:

  • I am generally interested in startups
  • It is great for my CV – if I ultimately want to move into venture capital
  • I may ultimately turn it into a business
  • It helps to create generational wealth and ownership in the black community

I’m very excited to start this new chapter and would like to announce that applications are open today. So please send you applications to neekcapital@gmail.com in accordance with the details above.

 

 

 

Do feed the animals: The gaming sector as tech’s underutilized springboard

There has been a lot of recent confusion surrounding Improbable, the UK software unicorn backed by a16z and most recently, Softbank to the tune of over $500m. I’ve heard it characterised as a gaming company, an AI company, even a VR startup and consequently began trying to unpack the source of this confusion. Improbable is what it describes itself as, a company that provides software that helps create virtual worlds. The confusion seems to stem from a combination of the width of this description and the company’s trajectory and business objectives.

The width of the ‘creating virtual worlds’ is one of the key drivers of mystique around the company. It is a phrase that can be readily interpreted narrowly or widely, one narrow interpretation of the concept leads to viewing Improbable and gaming company based on seeing virtual worlds as game worlds. On the other hand the wide conception sees virtual worlds as just that, worlds that do not physically exist. Improbable really sits under this conception – the company’s software is suited for the creation of both game worlds and simulated environments in general. The width of the offering has, however, been artificially obscured by the company’s initial focus on the gaming sector as its anchor market. This initial focus is still illustrated by the fact that its product lines are split into ‘Spatial OS for games’ and ‘Spatial OS for business’.

This whole confusion led me to wonder why a tech company would position itself as a gaming company initially and subsequently expand into everything else. What, if anything, was unique about gaming that made it best suited for the rollout?

This post answers this question arguing that a games first go to market (like Improbable’s) is genius as the sector, by virtue of being the confluence of art and technology is the perfect incubator for technological innovations with wider applications and is definitely something that more investors and founders should have in their playbooks. 

Why does gaming work?

I would argue that the gaming is an industry that possesses unique characteristics that make it the perfect training ground for technological innovation. This stems from gaming’s unique position as a melange of technology and art, which allows even the smallest technological improvements to create value to the customer, where they otherwise wouldn’t.

A way of illustrating this is by comparing a pure simulation tech company with, for example Improbable.

A pure simulation company that has for instance built out software that looks at the impact of changes in roads taking into account only traffic data, would likely struggle to justify expanding its software to also take into account additional factors (such as the school run, or events) apart from those deemed particularly material (e.g. pedestrians, traffic lights, road works). This difficulty stems from the fact that the incremental improvement to an enterprise buyer (say a government department) would seldom justify the cost of developing such improvements by the software companies. These improvements, would likely be prohibitively expensive in an enterprise or consumer context, and each individual improvement would likely be immaterial.

Improbable’s approach, however, has some significant advantages. Because games are art-tech and compete as such, there is value in incremental improvement insofar as it furthers the art. It is this phenomenon that allows game developers to successfully monetise annual iterations of the same game with only some minor tweaks or slight graphical improvements. When a consumer purchases FIFA 2018 having purchased the 2017 version the year before, they are not purchasing the incremental technological improvement (that would be too miniscule to make sense), they are in fact purchasing a better form of art.

The fact that the art is improved by incremental technological advance is an incidental fact to the consumer but understood by developers and publishers. This fundamental calculus by the business side of the gaming industry creates a perpetual arms race in the industry as companies attempt to improve their art by way of tech. Consequently the industry, able to monetise incremental and even marginal technological innovation as art, will much more happily pay for it than other sectors. Making it the perfect industry for tech companies attempting to develop deep tech capabilities.

Improbable by initially targeting gaming and MMO l developers took the ramp rather than scaling the mountain. This allowed the company to develop its simulation platform able to point to a captive market for each incremental improvements where a traffic simulation company likely couldn’t. While perhaps the traffic simulation company would have been able to aggregate enough marginal improvements to make its product much more compelling, the journey to this ‘critical mass’ of improvements is more expensive and more likely to fail a short term cost benefit analysis. In the best case scenario for our traffic simulation company, it faces a significant time lag between technological improvement and validation where a gaming focused company would experience validation as it rolls out capabilities.

A compelling example of this concept at work in reality is the use of GPUs in artificial intelligence. One could make a compelling argument that the reason Nvidia’s technology was mature and sophisticated enough to be suitable for the vector computing requirements of modern AI was largely due to the fact that gamers’ desire for greater graphical fidelity provided the necessary market allowing Nvidia to continue the improvement of their hardware. I would argue that if Nvidia’s principal market was AI, the company would likely not have reached the heights it has currently achieved, primarily due to a lack of market for an early stage iteration of its product. In this sense AI (and Nvidia) has benefited from the perpetual market for iterative improvement provided by gaming.

I consequently implore, prospective technology entrepreneurs seeking to build out deep capabilities over a relatively protracted period of time to seriously consider using the gaming industry as the incubator for their nascent technology. It is clearly better to develop an advanced physics engine for a market of those obsessed with the reality and fidelity of in game physics for the sake of art than for a property developer or manufacturer obsessed with the strength of his/her bottom line.

Where’s Netflix? Why a cloud-gaming giant is unlikely to materialise

Why is Netflix so successful?

Instrumental to Netflix’s success is the superiority of its offering versus the incumbent Pay-TV operators and DVD rental services. Netflix has been able to disrupt Pay-TV operators so effectively because it offers a non-linear service. By allowing customers to curate their own TV, Netflix and other VOD services have a palpable advantage over linear TV services. Where a linear TV service must select programming that appeals to the widest audience (and consequently leave some customers underserved at any given time), VOD services are able to satisfy all users at all times. By connecting the users directly to content and giving them the ability to watch it at their own pace, streaming not only serves customers better, but also allows companies to monetise otherwise unprofitable / niche content. The advantages of Netflix versus DVD rental are even more evident. Because streaming provided a frictionless way of gaining access to video content, it erased the need to have specific equipment (i.e. DVD or Blu-ray players), got rid of the lag time between the wanting to view content and being able to view it, and gave consumers access to a content library far superior to that which could be housed in any single store, moreover it eliminated a lot of the hassle related to DVD rental (returns, late fees etc.).

In addition to the advantages of streaming as a content delivery mechanism, the lethargic reaction of competitors (Blockbuster etc.) allowed Netflix to establish dominance in this new segment with relatively limited hindrance. Where content creators could have limited Netflix’s access to their libraries, thus reducing the attractiveness of the platform, they instead licensed it content that they were unable to monetise effectively themselves (due to the linear nature of Pay-TV). In essence “networks [were] far more concerned with protecting their lucrative paid-TV revenue than with propping up their streaming initiatives”. By allowing VOD services to populate their libraries with their content, networks unwittingly allowed Netflix and its ilk to gain control of their end users.  This ultimately created a virtuous cycle for VOD providers as, having ceded control of their end-users, the networks became increasingly dependent on licensing revenues where previously they would have relied on subscribing customers.

For cloud-gaming, however, questions remain around the chances of there being a disruptive service in the current market conditions. Currently the market is largely dominated by the traditional business model where players buy the games they want to play outright. Even though there is an ongoing shift from physical to digital ownership, the way games are monetised has not changed much, other than disintermediating third party retailers. For the most part, forays into subscription based models have been carried out by the traditional console makers (although Nvidia has also been active in this area), however, such ventures have largely been bundled with other services or have been positioned as a supplementary offering. Analysis of the gaming services that have sprung up in the wake of the media streaming revolution, shows not only that cloud-gaming is a long way from truly disrupting the traditional distribution model, but also that there are some significant barriers in the industry’s structure that significantly reduce the likelihood of successful disruption going forward.

The services currently on offer

Nvidia’s subscription GeForce Now cloud-gaming service most resembles the video gaming equivalent of Netflix. The service allows subscribers to stream a library of 100 games without the need for installations, discs etc., but with the caveat that one of Nvidia’s Shield boxes is necessary to do so. While the service is promising from a quality standpoint, allowing 4K gameplay, the platform faces significant structural difficulties around content and user acquisition. Versus Netflix or Spotify, it is difficult for Nvidia to acquire subscribers via traditional means (discounts, trial periods etc.) as the service is only available on Nvidia hardware. A prospective subscriber must first get over the $200 cost of the hardware before then paying for the monthly streaming service. Couple this prohibitive upfront cost with Nvidia being relatively unproven as a console maker, and the platform’s limited library versus the traditional consoles (the platform currently has c.100 titles), and it becomes hard to see how Nvidia will be able to convert users to their platform. These user acquisition problems simultaneously make it difficult to gain content, as developers have no incentive to expend time and capital making games for a little used platform, creating a vicious cycle limiting Nvidia’s prospects of success with their cloud gaming platform.

Nvidia’s underlying problem is that it does not ultimately have control of the user, that control is currently vested in the incumbent console makers and publishers. Publishers (as a class) have control over the end-user because they ultimately create the product that users desire. However, their individual power is limited by the fact that they don’t control the means of play, for example it would be absurd for a publisher, even one the size of Activision, to move to exclusively support a platform with few users. In a similar vein, console makers capture the consumer by providing the means of playing games, but given that this control is predicated on having games, console makers are only powerful when they have sufficient pull to ensure that most games are published on their platform. The more users a console has, the more power accrues to it in the publisher / platform relationship, at critical mass it becomes asinine for a game publisher to not release a game on that platform (at least in absence of external factors like exclusivity deals). Thus, Nvdia’s and other prospective cloud gaming platforms are faced with a barrier to entry in that they need content to gain users and yet simultaneously they need users to gain content (at least in absence of paying a significant amount of money to for it). Consequently, without deep pockets – to pay developers for content, the chances of a cloud-gaming giant emerging independently of the big 3 console makers (who already have the users) is bleak. Analysis of these console giants’ forays into cloud-gaming / alternative distribution models, therefore, will provide a great indicator of the likelihood of a cloud-gaming or similar subscription-based platform becoming the dominant business model.

PlayStation Plus is a subscription service providing customers with the ability to download selected games each month (the service currently adds access to 2 new games monthly) which are retained for the lifetime of the subscription. This service, however, is not cloud-gaming, as the user still must download a game to play it and the library of available games is extremely limited compared to the range on streaming services. Moreover, Plus’s main value to users is in providing access to PlayStation’s online multiplayer platform; the purpose of the free games is largely to make the bundle more attractive. For these reasons, it does not make sense to view it as an alternative to the traditional model, but rather as a supplementary service. Xbox Live Gold is essentially the same service delivered on Xbox hardware and consequently is disregarded for the same reason.

PlayStation Now, on the other hand is an actual cloud-gaming service, allowing users to stream around 500 PS3 titles to their PS4 or PC. Now, however, is clearly limited in its scope – firstly 500 games is hardly an expansive library when compared to analogous services like Netflix, especially given that the service has had 2 years to build its library. Secondly in providing access to PS3 games only (note that PlayStation did recently announce it was going to begin adding PS4 games to its library), the focus seems not to be on providing access to the latest content but rather on monetisation of their back catalogue. Thirdly in being limited to two platforms the service is clearly different from Netflix which provides significant value to users by being platform agnostic. The last point is especially damning as I believe that there is no realistic prospect of PlayStation extending the service to many non-Sony platforms (in fact Sony actually removed support for the PS3, Vita and other Sony products). This is because, as a console maker it would make no sense to provide a service that eliminated the need to purchase your hardware. The presence of the service on PC, though contradictory to this, seems to be a thinly veiled attempt to monetise PlayStation’s exclusive content amongst die-hard PC gamers rather than a bona fide attempt at creating a platform agnostic service; requiring subscribers to use a PlayStation controller, for example, does not look like the behaviour of a company serious about fostering a platform agnostic streaming ecosystem. It does, however, look like the behaviour of a company focused on hardware sales. The combination of these limitations renders it is unlikely that Now, at least in its present iterations, is gaming’s answer to Netflix.

Xbox’s upcoming Game Pass service largely mirrors Playstation Now in its model with the caveat that rather than streaming games, Game Pass users will have to download the games their subscription gives them access to. Another difference is that the service will be launched with a library including both Xbox 360 and Xbox One games, indicating some willingness to provide reasonably recent content. Despite some differences, many of the limitations to PlayStation Now are equally applicable here. Firstly, Game Pass is to launch with a limited library (just 100 games) secondly, I believe it unlikely that the Game Pass will ultimately be platform agnostic for the same reasons that PlayStation Now isn’t and thirdly, unlike Now, by requiring users to download the games that they wish to play, Game Pass adds a layer of friction not seen in streaming services like Netflix and Spotify.

Conclusions

In summary, the none of the subscription services offered by console makers are likely to become gaming’s Netflix if they maintain their current form. Where Netflix offers vast choice, these services offer a limited selection of games, where Netflix offers frictionless access to content only PlayStation Now and Nvidia provide access to games with without the need to download, where Netflix allows users to access their video content regardless of the device they are using, these services are intimately tied to specific consoles. In a nutshell these services will need to significantly improve to provide the same level of attractive value to users seen in video and music streaming services. While it is entirely possible for console makers to improve the quality of these services to the point where they offer a superior user experience to the traditional model, I believe it unlikely for them to do so in the absence of a pressing incentive. Although a shift to streaming rather than downloading is a plausible improvement that console makers would be willing to implement, making such a service platform agnostic would be self-defeating. As outlined briefly above, it would self-defeating for businesses focused on the sale of hardware to offer services which render their hardware obsolete.

Even if one were to somehow eliminate the inherent conflict of interest between platform agnostic streaming and console makers, other significant barriers exist making the development of a successful cloud based gaming platform difficult. One such area is content, where games publishers are unlikely to offer up their most lucrative new intellectual property for streaming. Publishers of best-selling games will be unwilling to cannibalise revenues from direct sales of their most popular franchises by making them available more cheaply elsewhere via a subscription model. Consequently, any streaming platform seeking a library filled with top content will likely have to pay the likes of Activision and EA an unsustainable amount for the right to stream the latest iterations of their premium franchises. Moreover, even some of the premium older content will be expensive to gain the rights to, given that publishers have historically been able to monetise their ‘classic’ content by re-releasing these games at full price.

While this problem is analogous to the problems faced by VOD providers as the transition to streaming began (in that their libraries were initially populated with older video content) the specific dynamics of video game industry make this a much sturdier barrier to entry than in the TV industry. A key reason for the success of Netflix despite an initial lack of access to the most recent TV content was the fact that TV content retains value to users for a long period of time. Old TV shows and music maintain value better than video games because of the nature of innovation in those industries. The differences between new television versus older content are predominantly around qualitative factors (though admittedly there is some difference in technical areas such as video quality) while for games, because of the technology driven nature of the industry, many more factors separate old games from new. For example, a new game will likely have far superior graphics to an old game as the capabilities of gaming devices have expanded, similarly new games also have features that did not exist previously such as online multiplayer. A game from even 5 years ago will struggle when compared against a game released now on several factors in a way that a 5-year-old TV show wouldn’t. Consequently, launching a cloud-gaming platform with a library of only old games would be like Netflix launching with a library populated with black and white films. In such a scenario, the product offered by the games streaming service is clearly inferior to the traditional offering which will significantly hinder its ability to attract users. Where Netflix could capture the user using older content to compete with linear TV (weakening the traditional players by diverting users away from linear TV) and subsequently gain access to newer content later at a more reasonable rate having weakened the incumbents, old games cannot capture the gamer as effectively as old TV captures the viewer. Thus, it is unlikely that a cloud-gaming platform will be able to overcome the hurdle of intransigent content publishers, who benefit significantly from the status quo being maintained.

On the surface the rise of cloud-gaming seems inevitable, however, after careful analysis of the industry’s structure and the attempts made so far it emerges that the structure of the industry itself is a key barrier to such a company emerging. The grip that major console makers and publishers collectively have on the end-user significantly hampers the ability of an outside actor to gain traction, while in the case of the incumbent console makers and publishers there is an absence of incentives support a shift to a business model that will likely reduce their revenues. The combination of these factors mean that the advent of gaming’s Netflix is likely far further away than one would initially expect.

VC and Video Games: Separating the Wheat from the Chaff

The video games industry is gaining ever increasing publicity, from the hype surrounding Zynga’s Farmville in 2009 to last year’s media circus surrounding Pokemon Go there has been a definite shift in the world’s attitude towards video games. Gaming has moved in the public psyche from a fringe activity to a mainstream form of entertainment, a point that truly impressed itself on me when my mother began playing Angry Birds. Yet, despite this heightened public awareness of the sector’s importance, I believe there remains significant confusion about the industry, most surprisingly amongst the venture capital community, those one would expect to be most ahead of the curve. Though, we have moved from the stage where mobile gaming is seen as a fad (it’s hard to see something as a fad when it generates the majority of the App Store and Google Play revenue) the way individual company’s within the ecosystem are characterised  is not dissimilar to how the entire industry was seen previously. The lens most often used to view companies within the sector is that of the hits-driven business, this characterisation is damaging insofar as it suggests that success in the industry is for the most part random. This viewpoint proves problematic since it frames gaming companies are unsuited to the sort of discerning investment that you see in the wider venture capital space. This post aims firstly to cast doubt upon the hits-based based industry thesis and to subsequently outline a logical approach for investing in the sector.

Debunking the hits-based myth

One of the best explanations of why viewing gaming studios as hits-based is flawed was provided by Ben Holmes (a partner at Index Ventures) at Slush 2015 (link). I suggest watching the video for a fuller explanation, however, I will briefly outline the three main points below. The first line of argument essentially points to the longevity of certain games, Holmes uses King’s Candy Crush Saga and Supercell’s Clash of Clans as examples, to debunk the myth that mobile games are hits in the sense that they fated to rapidly acquire users and subsequently lose them overnight. The fact that these games, both of which were 3 years old at the time of the talk, continue to maintain strong user bases is telling. Secondly Holmes attacks the notion that games studios have a random chance of replicating their prior success in their future games, pointing to the presence of multiple games by developers such as King, and Supercell in the top 100 rankings on both the App Store and Google Play as evidence that good studios are able to consistently release successful products. And finally, Holmes challenges the idea that successfully investing in games studios is a luck based exercise, pointing to track record of firms focused on the sector such as his own success at Index (King, Supercell, Playfish) as well as London Venture Partners (Supercell, Playfish) and Initial Capital (Space Ape, Supercell, Peak). In all Holmes provides a cogent defence of strategic investment in gaming. This defence viewed in tandem with the expected growth of the sector (the industry is forecasted to be worth $120bn in 2019 having grown by $20bn since 2016), renders investment in gaming an opportunity that the wider venture capital industry ought to be looking at more closely.

Separating the wheat from the Chaff

This isn’t to say that investing in the sector is easy. There has been a veritable explosion of game developers and studios trying to create the next Clash of Clans and it is a fact of life that they can’t possibly all succeed; thus the prospective investor has their work cut out for them when seeking to discern which few companies will be ultimately be the winners. While this seems like a daunting task, the success of the firms mentioned above at consistently investing in winners suggests that frameworks exist with which such companies can consistently be identified. The logical next question is as follows: What allows Index, LVP and Initial to identify the Supercells of this world where others miss them? What is it about the structure of these firms that allows them to separate the wheat from the Chaff?

The thing that these three firms seem to have in common is the fact that they all have a genuine belief in the sector. Initial sees games as a fundamental vertical, listing it as the first of its three investment areas, Index’s partner Ben Holmes is clearly bullish on the sector and has significant expertise and passion for it leading multiple funding rounds in this area, while London Venture Partners was set up by industry professionals to invest exclusively in gaming. It emerges that none of these funds are investing opportunistically in gaming – they have clearly diverged from the industry standard ‘hits-based’ mantra and have diverted real focus to the industry. It is hypothesised that by diverging from this mantra, these firms have been able to develop the type of pattern recognition that venture capitalists regularly rave about in an industry that has been somewhat neglected by venture capital. This differentiation confers a huge advantage when identifying what will work and what won’t and developing frameworks with which to view and filter investment opportunities. Clearly the approach in the linked presentation by LVP, which essentially outlines what the trajectory and behaviours of a successful gaming start-up looks like, is preferable to the view that success is unpredictable when making investments.  Moreover, since the volume of competitors within the industry has increased on the back of the success of some of the abovementioned names, I believe that frameworks such as these will become ever more important when sifting through investment prospects and that the venture funds that invest in developing the requisite pattern recognition and frameworks are the ones that will ultimately see consistent success in this sector. I mean it stands within reason that a complex, competitive industry should be approached with an equally complex understanding of its nuances and what leads to success.