Forget Ivy League diplomas and glossy CVs. According to Lily Wang of Expon Capital and Yannick Oswald of Mangrove Capital Partners, the founders who win venture backing are those with deep conviction, relentless energy, and the ability to inspire others to join a long, uncertain journey.
A diploma from a prestigious university, a background as a serial entrepreneur, or a history of running a successful business can help convince VC firms to invest in your startup.
But “the majority of the founders that we back, they don’t necessarily have the Ivy League education background. They’re probably first-time entrepreneurs and have a lot to learn,” says Lily Wang, partner at Expon Capital. The VC firm is a generalist firm and is not constrained to any particular sector. Expon has invested in companies like Videobot (marketing), Cascade (regtech), MarketLeap (e-commerce), and Exobiosphere (drug discovery).
“The reason we invest in them is because they have a strong conviction about their business.”
It’s key that entrepreneurs have a deep understanding of the market, have identified a pain point, have a solution to address that issue, and are making some good initial progress. “These are the kinds of entrepreneurs that we like to back, even though they have zero entrepreneurial experience in the past, without any fancy CVs,” says Wang.
More than just technical skills
The ability to attract talent is another factor that Expon looks at. “None of us is good at every single aspect,” Wang points out. “You need the ability to inspire and attract people to join forces in building a company with you.”
Getting a company off the ground goes beyond the technical elements. Being able to communicate clearly and to convince others about your product, the ability to learn and accept feedback, and to think logically and make tough decisions, notes Wang, are also important.
A passionate “hustler”
Passion is key for Yannick Oswald, partner at the VC firm Mangrove Capital Partners. “We look for, in essence, people who are obsessed with the challenge they want to solve, but also obsessed with building a great company. It’s very important to differentiate the two.” The first category of people are those who have identified a problem and are working on solving it; the other wants to build a large business in the mid-term.
“We look for, in essence, people who are obsessed with the challenge they want to solve, but also obsessed with building a great company.” Yannick Oswald
Those are two different approaches, he explains. “We try to look for both, but it’s ultimately really about the energy, the passion, the obsession. They pull you with them. And that’s very important, because you need to have endurance to get through the ups and downs.” Oswald adds that he doesn’t care about what’s on a person’s CV. “The first thing you look for is: is this someone who is passionate, who is a hustler?”
“You want to have a founding team who knows what they’re doing, we don’t care if they’re insiders of the industry,” he says. “Often outsiders have a much better view of what can be changed, [but] they obviously need to be very knowledgeable and have done their homework.”
Like Wang, Oswald notes that the founders probably won’t have every necessary skill – so they need to be able to communicate well and get top-notch talent excited about working with them. This ability to tell a story is “so underrated,” he argues, but it’s essential for fundraising, recruiting talent, and raising awareness of a company and its product.
A generalist VC firm, Mangrove Capital Partners has invested in companies like Flo Health (a femtech that became a unicorn in 2024), Sifflet (an AI-augmented data observability platform), and Project B (a new global basketball league). The investment in Flo Health was very much “performance, execution-driven,” says Oswald. “The potential was amazing, and female health has been underinvested in over the decades.” Sifflet had an “extremely strong, visionary pitcher,” he continues, adding: “Sometimes you have to bet on those people if they have conviction.” And when it comes to Project B? The team behind it, Geoffrey Prentice and Grady Burnet, has a history of scaling consumer platforms, he says.
HR tech and edtech: on the rise
Talent is a key topic in today’s economy, with companies in all sectors doing their best to attract and retain employees. HR tech is something that could help with this endeavour. Figures from the data firm PitchBook show that deal value in the European HR tech sector reached a staggering €3.04bn in 2022, up from €78m in 2014.
“For the past decade, there has been a lot of innovation in HR tech, so you’ve seen a lot of digital platforms coming up,” says Wang. “And if anybody wants to set up another HR tech company, we’re going to ask: what’s your competitive advantage?”
Exergue: “And if anybody wants to set up another HR tech company, we’re going to ask: what’s your competitive advantage?” Lily Wang
In 2020, Expon Capital invested in Cyberr, a Luxembourg-headquartered platform dedicated to recruiting cybersecurity experts, notes Wang. The company has set itself apart thanks to its focus on cybersecurity professionals and its understanding of market needs. “That really distinguished them from their competitors,” she explains.
Innovation in the past focused on digitalisation; the current wave is about how you use AI to speed up your business and provide more value to customers. “We are looking for HR tech solutions that use AI at their core to transform the current status of the HR tech industry,” says Wang. “Either you adapt to the AI world, or you wait to get disrupted by others.”
For Oswald, upskilling and reskilling will be key in the future, and corporations will need help with that. Edtech and solutions that support digital learning, such as those that use virtual reality or AI, could help play a role. “When it comes to recruitment, we see a lot of innovation, but it’s still early days,” he adds, with automation driven by AI. “I can imagine that more will happen there to make processes more efficient.”
Wang concludes with an invitation: Amazon in December announced some 300 job cuts in Luxembourg, and that means there’s a pool of highly-qualified (ex-)employees who have the opportunity to create their own company. One of Expon Capital’s portfolio companies, MarketLeap, was founded by two ex-Amazon execs several years ago, she points out. “There are great talents, and they could use AI to disrupt some existing industries. And if they have great ideas, we are here to speak.”
