Our Thesis.exe

TL;DR;

  • 🎯 Overview: 12 deals per year, tech, any sector, (co-)leading €1m to €5m seed rounds, blockbuster potential.
  • 🌿 Desirable impact: we invest only in companies that are neutral (no negative externalities) or positive. One needs to love the mission and be proud of one's business activities - whatever the final result.
  • 🚀 Pre-market fit: we believe we can bring most value given our background and knowhow during this period when the right mix of operational and financial perspectives is needed and when people need to be at ease with uncertainty and complexity.
  • 🌎 Generalist: innovation happens in a non predictable way. We invest in the most promising companies launched by the best founders, which may not be in a preconceived subcategory.
  • 🤝 Support in the 12 to 18 first months is paramount: we help entrepreneurs make the right decisions, access to network & knowledge, support them during stressful times, help them set up the right culture & organization, secure the right talents with the right conditions and help them get the right investors onboard (and manage them).

When & how much?

We invest around 0.6m€ to 2.5m€ tickets in companies during their uncertainty stage. Our sweet spot is the first seed round, we also look at seed-2. Sometimes we are the very first investors, sometimes we come after business angels.

Where?

Mostly in France. That's where most of Galion members are based and thus where we can provide most value.

Which industry?

Any*. Imagine it's the year 2000, and one tries to depict what the mobile internet might look like. What could have been possibly predicted?

(*Yet, since we don't keep follow-on capital, we avoid capital-intensive industries.)

What are you expecting from founders?

We believe a great founding team has four characteristics:

  • a strong vision and a compelling strategy to make it a reality,
  • great execution capabilities that can be assessed with their track record and their first achievements in the company,
  • the right symbiosis in their team, with clear complementarities and trust,
  • their attractiveness for third parties, be them investors, potential employees, or potential clients.

We also look for specific qualities for founders: leadership, adaptability, grit & alacrity, and smartness.

What kind of markets do you favour?

We believe there are two desirable situations:

  • colossal, oligopolistic markets, where becoming a new leader creates gigantic successes while facing real challenges (regulation, competition, resources already committed, etc.).
  • niches expected to expand, where new targeted companies build singular experiences that resonate strongly with consumers (requiring a clear sense of purpose, excellence of product building, a strong identity, etc.).

What are your decision criteria?

At the seed stage, some of these characteristics might not be easily observable, or only at a nascent stage. Yet, we think it is important to highlight and anticipate them.

Here are the main drivers of our decision-making:

Context

We look at the fundamental trends and shifts that should generate a good traction.
  • macrotrends: looking at long-term changes that affect large populations;
  • new beliefs and usages: understanding the value and behavioral shifts;
  • new technologies: analysing what is technologically feasible that wasn't before;

Market opportunity

How big the business can become.
  • market size: evaluating how large are the total and serviceable markets;
  • growth potential: assessing how big and fast the company can grow within the market and figuring out to what extent the company benefit from increasing returns to scale;
  • regulation: figuring out what the current and potential legal constraints are;
  • competition: looking at the different types of competitors and their distinctive models;

Go-to-Market

What value proposition the company will offer to its clients and how.
  • product: using frameworks such as job's to be done to assess the value proposition and user benefit, understanding the product roadmap, the vision behind and what the product is going to become;
  • user engagement: identify the different users, analysing tractions and user feedbacks with the product/service;
  • adoption cycle: channels, time to decision and decision process, stakeholder involved;

Responsability

  • founders beliefs: traits and values of the founders, corporate values and rites put in place in the workplace;
  • business models/risks: presence of negative externalities, impact/risks for the environment or the society of their activities;
  • ESG roadmap: defining priorities and quantified and qualified goals

Profitability

  • unit economics: understanding the current economic equation and anticipating its evolution;
  • capital efficiency: will growth be frugal or require tons of capital;
  • exit perspectives: what are the comparables, potential exit paths, and value.

Team

  • a strong vision and a compelling strategy to make it a reality,
  • great execution capabilities that can be assessed with their track record and their first achievements in the company,
  • the right symbiosis in their team, with clear complementarities and trust,
  • their attractiveness for third parties, be them investors, potential employees, or potential clients.