“People will tell you that more than 90% of startups fail,” says Magnus Grimeland. “That is true, but the majority fail for the wrong reasons. We root out the reasons that cause startups to fail.”
As Grimeland sees it, too many startups have a self-destruct button built into their DNA. For instance, the founding team may be ill-matched in terms of temperament and ambition. That’s fine in the early days when enthusiasm about a particular project typically serves to paper over any cracks, but any underlying differences between the founders can open up further down the line when large sums of money are being raised and crucial decisions must be taken about the direction of the business. Thus, a young company may fail, not because of the product or the market, but because its movers and shakers are incompatible.
As Founder of Antler, Grimeland takes the creation of founder teams very seriously. An alumnus of consultancy, McKinsey, he went on to work for Rocket Internet before moving to Singapore, where he co-founded online fashion retailer, Zalora South East Asia. During his time at Zalora he saw an opportunity to build a “startup creation” platform that would bring together would-be entrepreneurs with different and widely varied skillsets to form teams and develop business ideas. After launching in Asia last year, Antler has expanded its operations to Europe, with programs in Stockholm, Amsterdam and London.
One Hundred Entrepreneurs
Antler’s goal is to create and then invest in new startups. Each cohort sees around 100 “entrepreneurs” come together for two months with the aim of encouraging them to create new business concepts. Over the course of this initial phase, the expectation is that teams will coalesce around certain ideas, which will, in turn, be developed into viable business models. Antler will choose what it – and its advisers – consider to be the pick of the crop and invest $140,000 for a 10% equity stake. After a further development period, the new businesses are pitched to outside investors at a demo day. In that respect, it is a business creation venture and accelerator combined.
A similar model that has been pioneered in the U.K. by Entrepreneur First, but Grimeland believes that London – in common with other European capitals – will, nonetheless, prove fertile ground for a venture that promises help talented individuals to fulfill their entrepreneurial ambitions.
That, of course, begs a question. Why should a would-be entrepreneur – especially one with vision and drive – choose Antler, rather than simply going it alone, building a business independently, and perhaps later when a team is formed, joining an accelerator? After all the entrepreneur of modern mythology is a driven visionary who already has a plan of action.
Well, Grimeland says one factor is that a place on the Antler program provides access to a 100-strong cohort comprised of people with diverse skills. Grimeland says this makes it easier to put together teams. “You might have an idea for a business that requires someone with A.I. skills. Such a person may not be a part of your network. However, there is a good chance that you’ll find that person on our program.”
As Grimeland sees it, many of the people who join an Antler cohort would go on to become entrepreneurs anyway. Participation in a program comprised of like-minded people simply makes it happen sooner.
That assumes, of course, that Antler can attract the right mix of managers, marketers (and general hustlers), engineers, and industry experts. The aim is to attract people who are among the top 2.0% of peers and colleagues in their chosen fields. That might be someone with a Cambridge doctorate in computer science or an individual with a successful career in senior management. Prior to joining they will, typically, be employed by others and part of the deal is that they give up their jobs to pursue an entrepreneurial life.
There is a danger in any program of this type, that the organizers enforce criteria that exclude some genuinely talented people. For instance, it’s unlikely that prior to launching his first business, Richard Branson would have figured on anyone’s top 2.0 percent list. Grimeland insists that there is variety. A degree from a top university is not a prerequisite for entry. However, all applicants are required to sit a series of tests designed to identify those with the talent, drive and vision to benefit from participation.
Choosing A Partner
The Antler model also assumes that a disparate group of people will naturally form into teams with the right mix of skills. Grimeland says this happens organically. The first stage of any program is designed to encourage people to work together on problems. As alliances form, everyone will be encouraged to think carefully about their team choices. “I always say people should choose team members as carefully as marriage partners,” says Grimeland.
The business ideas are generated in part by members of each cohort, with VC and corporate partners also contributing their thoughts. For instance, a VC may have identified a business opportunity and this will be put to the cohort. Grimeland stresses that no one will be required to run with ideas suggested by third-party partners. “What we want is for founders to go with ideas that they can get really passionate about,” he says.
But is Antler succeeding in creating world-beating startups? Grimeland stresses that it is a young venture. “But we have launched 40 companies so far and they are all trading and earning revenues – except for one that is still at the pre-product stage.” The focus is on developing business models that can be exported from one region to another, industry 4.0 solutions aimed at transforming manufacturing processes, and a certain amount of cutting edge deep tech.
And the goal is to continue expanding, with programs in Nairobi, Sydney and New York due to launch soon.
So will Antler take off in London – and indeed in other cities where there are already relatively rich business support ecosystems. Grimeland points to applications for the London program, which he says have surpassed the number of applicants for the original cohort in Asia.
The real test will be Antler’s ability to create companies that make the journey through to series A and exit.