- What is Beacon’s investment focus?
We invest in companies building transformative technology for enterprise customers. We look for strong recurring revenue potential and scalable models (eg. the more the company sells, the cheaper it is to make those sales) We back entrepreneurs able to clearly articulate a new market opportunity or a gap in an existing market. We make our entry investment at a very particular stage: post seed and pre-Series A. The majority of Beacon’s 30 investments to date have been enterprise tech related. Where there are exceptional factors, Beacon can make investments outside of these core themes.
- How is Beacon different from other tech investors?
Early stage venture capital is a labour intensive business and most funds cannot support a broadly resourced investor team with adequate experience and engagement leading to sub-optimal diversification and poor post-investment value creation. Beacon’s diversified team of venture partners (all of whom have invested as a team since 2012) gives it a unique edge for portfolio diversification and post investment value creation.
Our ability to add value post investment is a key strength. As investors in the London technology sector since its early days, we have built a trusted network that we leverage to provide assistance in vital areas (see below for how we work with portfolio companies post investment).
- What is Beacon’s typical investment size and stage?
Beacon invests post seed and pre-Series A. This typically means fundraising rounds of between £500,000 and £2m. Beacon aims to provide 50% of the round.
- Does Beacon follow on in later funding rounds?
Beacon’s investment strategy involves following on in Series A rounds. In some cases, we can make additional investments beyond our pre-emption rights. In exceptional cases, we may also participate in Series B rounds.
- Can Beacon be lead investor?
Beacon is an experienced lead investor. We have been lead investor in the majority of our investments. As lead investor, we assist founders by coordinating and syndicating with other investors where necessary. We are equally comfortable with participating in rather than leading funding rounds.
- What are Beacon’s key investment criteria?
The following are must haves for Beacon:
- Target addressable market greater than £500m
- Well balanced founder team incorporating technical and execution ability (a CTO with a founder level equity stake is strongly preferred)
- Some validation of product/market fit
- How long does Beacon take to issue a termsheet?
Each case is different. Depending on the material provided by founders, we aim to issue termsheets 3-6 weeks after first contact. It is particularly helpful where founders come prepared with comprehensive material on their addressable market. It takes at least 2-3 meetings for us to decide whether to issue a term sheet. Termsheets are issued when we believe Beacon and the founders can work well together. We do not ever issue termsheets “speculatively”.
- How long does Beacon take to close a funding transaction after issuing a termsheet?
Our term sheets are subject to completing our due diligence. This can take 2-4 weeks. The time it takes to close a transaction can vary greatly depending on the level of due diligence information prepared in advance by the founders.
- How does Beacon work with its portfolio companies post investment?
Beacon is a highly engaged investor. We have a board/observer role in most of our portfolio companies. We leverage our experience and track record as one of the most successful early stage investors in the London Tech ecosystem to add value in vital areas, including:
- Business development
- Digital marketing
- Financial modelling and structuring
- Office space
- Positioning for next funding round and/or exit options