09 May 2014

How we make decisions

By Lily

Applications for our summer programme closed on Monday evening – and we have spent this week going through a pretty brilliant batch of ideas to use technology to change the world.

We know that funders’ decision-making processes can seem opaque; startups often tell us they have no idea why the decision about them was made either way. So, seeing as it’s on my mind, I wanted to tell you a bit about how we do things at BGV.

Shortlisting

First, our team and some hand-picked mentors and alumni, go through all of the applications and rate them on three things:

  1. Importance of the problem. Does it fit into one of our investment themes: health, education or sustainability? Is the problem specific enough to be tackled ie not: “world peace”
  2. Ingenuity of the solution. How well does the solution fit the problem? How new is it as an idea? Is it primarily technology based?
  3. Quality of the team. How well do the team understand the problem they are trying to solve? Do they have the skills needed to build the proposed solution? How well do they work together? (this last one is a bit of a tricky one to get from a written application – but examples of previous projects can be really helpful)

Then we pick the top 30 rated teams, sometimes there is some shuffling at this point to make sure that we have equal spread over our three themes, and to let any of us pick some wildcards that we are particularly fond of. We invite the final shortlist of 30 to interview.

Interviews

Each of our interview panels is made up of a member of the Bethnal Green Ventures team, an alumnus from the programme and one of our investors. We’ve found this is a good mix for giving teams a good all round impression of the programme and the people they will be work with.

At the interview stage, we’ve generally accepted that you are solving an important problem and that you have an interesting idea, so we focus mainly on the team. A good idea is no use without the team that can execute it. So how do you pick out a great team from a normal one? We are looking for the following clues:

  1. Ready to commit – we’ve found that the people who get the most out of BGV are those who are itching to get going and can quit all other work during the programme.
  2. Open to criticism – it’s unlikely at this stage that you have all the answers, we’re looking for teams that don’t take criticism personally and are keen to learn.
  3. Making practical progress – showing what you’ve done rather than things you’ve talked about or plan to do is always a good sign for us.
  4. Know who will do what – some of the toughest issues in the initial stages are around how to work together as a team. If you’re clear about who does what it’s a good sign.
  5. Comfortable with sharing credit and blame – this allied to clear responsibilities is the way that a team celebrates success and learns from mistakes.

We also have some red flags, that will stop us investing in a team:

  1. One co-founder is not as bought in as the others.
  2. The team is not quite sure what social problem it wants to solve. Ideas can change but commitment to a cause is hard to find quickly. If the team easily gets distracted by a business opportunity that doesn’t solve a social problem we don’t really want to be involved.

The Pub

After interviews we generally go to the pub, to wrangle out the final ten. We then take our thoughts to our investment committee who have the final say on which teams we invest in for our next programme.