How many VC funds can you name where the three partners all had babies whilst raising the fund, have deep connections in Asia as well as Europe and the US, and include actress Anne Hathaway as an LP? Not many I’d hazard.
But that’s the profile of Pact, a new Seed VC fund launched with a £30 million ($36 million) pot of cash to back early-stage startups across Europe. Pact will aim at ‘mission driven’ startups in what it calls the “ABC” categories: Access (economic inclusion), Betterment (personal and professional well-being), and Climate. (That’s a much more interesting way of addressing ‘doing good’ areas, instead of that trotting out the UN SDGs, IMHO). Pact’s investment tickets will range from around £1m to 1.5m.
As well as Anne Hathaway (she’s not ‘just’ an Oscar Award Winning Actor, but also a UN Woman Goodwill Ambassador), other LPs include Jeff Dean, the Head of AI at Google, and Keith Teare, a founding (and former) shareholder of TechCrunch and former tech entrepreneur in the UK and US.
They are joined by Anchor investor Campden Hill Capital; Yeming Wang, the former head of EMEA of Alibaba; Fahd Beg, the COO of Naspers; Todd Ruppert, the retired CEO of T. Rowe Price Global and venture partner at Greenspring Associates, and Tilo Bonow, CEO of PIABO.
The three female partners — Tong Gu, Reem Mobassaleh Wyndham, and Monik Pham — were former VCs in other funds. Gu was an investor at ADV (of which Teare was formerly a part) and built a data analytics startup in Shanghai which she exited. Wyndham was also an investor for ADV and a former founder. Pham was part of the founding team of the early-stage fund Fuel Ventures and launched several social enterprises in Africa and India.
Speaking to Reem Mobassaleh Wyndham, she told me they’d been raising the fund for a little over a year (during their pregnancies and first children) but the idea had been “in the works” for about five or six years: “We both joined ADV the same week. And we met Monik around the same time. What we observed within the early stage landscape in the UK was a few key things that were missing. There are very few early-stage fund managers that have both operational experience and deep operational experience abroad in emerging markets. And that's something that the three of us, in a very complimentary way, bring to the table.”
“We believe that capitalism should and can be inclusive while still producing huge results," she added. "And we really want it to be able to back companies at the early stage that are really positively shaping the future. We've all built our careers with that Northstar as a guide for us. It's a value that we've always espoused, but it's only now at this point that the market is really coming around to it. There shouldn't be a trade off between socially sustainable, environmentally sustainable and commercially sustainable outcomes. You have to think about both. And that's a value that all three of us came together on,” she said.
Tong Gu told me: “I grew up in China, and I witnessed how entrepreneurship and technology have enabled a large population of people who used to be under the poverty line to become wealthier and make their lives better. I started a tech company enabling independent small brand owners to compete with the larger ones. And for me, that was the experience of really driving economic inclusion, but in sort of a tech-enabled way.”
Wyndham admitted “it's not a huge fund”. However, she said the £30 million should get them enough companies to get the “healthy diversification” needed for fund returns: “We could do 18 to 20 companies, either leading or co-leading. We've been very thoughtful about how we have curated our LP base. So the LPS that have come in are strategic and they provide domain expertise, and market access, but they also provide capital continuity. The vast majority are looking for access to deal flow. So in that sense, this is actually scaling our firepower beyond the 30 million.”
Anne Hathaway (Source: Wikipedia)
On having a Hollywood moviestar among their LPs, Wyndham added: “She's actually a friend of mine and mentor of about 12 years and since then we've become friends and have shared values. One of her big causes is childcare, and lack thereof, as the final frontier for gender parity. And that's something that we've experienced firsthand as three female GPs who all had our first children while raising this fund. We had to figure out how to overcome the structural headwinds to be able to do both. That's very much one of the lessons that we hope to share with the ecosystem, and that's sort of where Anne comes in.”
Pact’s first investment has been made into Growth Kitchen, a London-based company that launches sustainable food brands based on data insights.
Past investments for the team members of Pact include Clause acquired by DocuSign. Onto, an electric vehicle subscription service; Perlego, an online learning platform; and Yoco, an African FinTech company.