The EIS Navigator 93 How to be a contrarian venture capital investor and making taboo investments with Will Gibbs of Octopus Ventures
Getting big returns in venture capital can involve stepping away from the mainstream and investing in opportunities that others won't. Will Gibbs of Octopus Ventures has a reputation for investing in areas others see as taboo. We ask him about being a contrarian investor, how to do it well and what needs to change to create a successful investment.
In a discussion filled with numerous examples, Will discusses:
- getting big enough markets when the market is somewhat hidden
- balancing new technology and new markets
- when specialist investors are needed
- judging whether a company will be ripe for follow-on investment
- how taboo investments can interact with social change
- sequencing market expansion
- what a company needs to internationalise
- what problems that internationalising doesn't solve
- building deal flow in taboo areas
- how the venture capital industry is creating some of the problems
- the value of team diversity in looking away from consensus areas
- whether valuations are different in taboo areas.
In a wide ranging conversation, Will brings a great perspective on how to bring mainstream venture capital skills to genuinely new areas. Its a great discussion for investors and companies who dare to be different. Enjoy!
01:00 Will introduces himself
03:40 Who Octopus Ventures are
06:30 Contrarian and tabooo investing
07:45 Example: Elvie - silent breast pump
09:50 Example: Pelago - substance use disorder
13:20 the size of taboo markets, challenges in assessing true market size
16:00 new tech and new markets - need for specialists
17:30 Example Overture - improving and automating IVF
19:20 market meets social movements - will someone follow-on?
22:05 assessing the pace of social change - risk of too early
25:30 sequencing the right national / international markets
25:45 Example Skin & Me - getting expansion right and not too quick
29:30 Time and capital to internationalise
31:00 when is the right or wrong time to internationalise
33:30 building deal flow in taboo areas
35:15 to what extent is the venture capital industry part of the problem - value of diversity
38:05 is the industry going in the right direction?
40:00 are valuations different in taboo areas?
42:35 creating communities supporting companies
47:45 prospects
50:20 Favourite questions
Links
Octopus Investments: https://octopusinvestments.com/
Octopus Ventures website: https://octopusventures.com/
Companies mentioned:
Pelago https://www.pelagohealth.com/
Overture https://www.overture.life/
Elvie https://www.elvie.com/en-gb
Skin and me https://www.skinandme.com/
Subscribe to the EIS Navigator podcast on most services here: https://the-eis-navigator.captivate.fm/listen
Suggested books and media
Essentialism by Greg McKeown
In the Company of Givers and Takers by Adam Grant (article)
https://hbr.org/2013/04/in-the-company-of-givers-and-takers
Bio
Will Gibbs
Healthtech Partmer, Octopus Ventures
Will joined Octopus in 2013 and sits in its Health team. He works with portfolio companies from consumer to enterprise, with a strong bias towards businesses making the biggest impacts on health.
In recent years he has explored taboo areas within health, resulting in multiple new investments around this theme, from substance addiction to LGBT sexual health. He’s also passionate about the potential for digital therapeutics to deliver superior outcomes for some conditions, US expansion, the future of cannabinoids and novel business models within health.
Will was based in Octopus' US office in New York during 2016, and continues to support portfolio companies looking to expand into the US health market. Many of his portfolio companies are based in the US, and he invests alongside big global investors like SoftBank Group, Kinnevik, Atomico and EQT Partners.
Will is also a vocal champion of diversity and LGBT issues and is happily married to his husband Christopher.
He founded multiple startups before joining Octopus Ventures, including a rare-breed pig farm and an organic spirits company.
Will holds a degree in ancient history and classical archaeology from the University of Oxford.