FF 014: Making Great Founders, Idea Creation and The First 100 Days Of A Startup with Alice Bentinck, Co-Founder @ Entrepreneur First

Alice Bentinck is Co-Founder at Entrepreneurs First, the accelerator program that puts founders first! Previously, Alice worked at prestigious consultancy firm McKinsey & Co, before turning down an offer from Google to found Entrepreneur First alongside Matt. She taught herself to code, and founded Code First Girls in 2013 to help more women get into tech. She sits on the board of Sherry Coutu's Founders4Schools, is on Imperial College London's Department of Computing Industrial Liaison Board, and acted as the Prime Minister's expert on startups at the Northern Future Forum. She has been recognised in Management Today’s 35 under 35 and the Evening Standard’s Top 1000 most influential Londoners. In Today's Episode You Will Learn: 1.) How Alice came up with the idea for EF and why she decided to found the company? 2.) What would Alice recommend is the best way to build a company from scratch? EF is for technical individuals, what can non technical individuals do? 3.) What would Alice say makes a great founder? Has she seen any commonalities in the great founders that have exited EF? 4.) What is Alice's opinion on equity divisions within startups? What is the right way to approach the topic? 5.) What should teams focus on in the first 100 days of their startup? What is the 20% that produces 80% of the results? 6.) What has been the hardest aspect of growing the business and how did Alice overcome it? As always you can follow Harry, The Twenty Minute VC and Alice on Twitter here! If you would like to see a more colourful side to Harry and many a mojito session, you can follow him on Instagram here!

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Harry Stebbings?

  You are listening to the 20 Minute VC with your host, Harry Stebbings. And as it's Friday, that can only mean one thing. It's Founder's Friday. And today, we bring you one of the most exciting young founders in the UK. It is, of course, the brilliant Alice Bentink, co-founder at Entrepreneurs First, the accelerator programme that puts founders first. Previously, Alice worked at prestigious consultancy firm McKinsey & Co. before turning down an offer from Google to found Entrepreneur First alongside her co-founder Matt. She taught herself to code and founded Code First Girls in 2013 to help more women get into tech. She also sits on the board of Sherry Cootoo's Founders for Schools, is on Imperial College

• 0:42Harry Stebbings?

  London's Department of Computing Industrial Liaison Board, and acted as the Prime Minister's expert on startups at the Northern Future Forum. She's been recognised in Management Stages 35 Under 35 and the Evening Standard's Top 1000 Most Influential Londoners. And just a little side note on today's episode, if you will excuse the background noise, Alice very, very kindly took time out of Can You Believe It?, a demo day, to record the show. So please bear with us. But before we jump into today's show, and with it being Founder's Friday, I'd like to talk to you about founder disputes and breakups. They happen to us all, and when they do, you want the best legal representation behind you. And that's where Vidal Law come into play.

• 1:23Harry Stebbings?

  Assess the situation, examining everything from vesting stock to correct payment of payroll. With decades of a startup experience, they will ensure you achieve a fair outcome in the most amicable way possible. So give Chris a ring on 312 895 4993, or check them out at www.vidallaw.com.

• 1:51Speaker 01

  You have now arrived at your destination.

• 1:54Harry Stebbings?

  Alice, it's an absolute pleasure to welcome you on to this very special episode of Founder's Friday. Thank you so much for joining us.

• 2:01Speaker 02

  A pleasure. Thank you for having me.

• 2:03Harry Stebbings?

  Now, I'd love to kick off today's episode by hearing a quick snapshot about you and your background, and how you came up with the idea for Entrepreneur First.

• 2:12Speaker 02

  Sure. So, after I left university, I headed off to McKinsey and Company, which is a big strategy consultancy, and spent a couple of years there where I met my co-founder Matt Clifford. And as we were thinking about leaving McKinsey, we were beginning to toy with various tech startup ideas. And eventually realised that what we should be doing is solving the problem that we had had when we were graduating from university, which was, we were both interested in startups and interested in building our own thing. But we weren't entirely sure how to do that and thought that probably the best thing to do was to go and join a big company. And so the idea was with Entrepreneur First was,

• 2:55Speaker 02

  how can we help talented, ambitious, smart people to build companies straight out of university, rather than go and join big corporates?

• 3:03Harry Stebbings?

  And you obviously work with companies at their very earliest stages. So, having witnessed company building at Entrepreneur First, how would you recommend is the best way to build a company from scratch?

• 3:15Speaker 02

  So, I suppose there are a couple of important ingredients to build a good company from scratch. At EF, what we focus on primarily is co-founders. So, we don't select teams, pre-formed teams, we select individuals. And so, if you get on EF, it's because we believe that you have exceptional talent, and predominantly exceptional technical talent. So, we think co-founders matter. And so, finding great people and finding great people to co-found with really matters. I suppose the next ingredient that really matters is the idea. Although I think often people approach this in the wrong way. They assume that unless they have the perfect idea, there's no point in even getting started. And they spend months, if not years, trying to craft the perfect idea, which just doesn't exist.

• 4:00Speaker 02

  And so the most important thing uh when starting from scratch is to come up with a idea and an idea. And that uh that resonates with you, that you're um uniquely skilled and talented to to start working on. And and then just to get going. And I suppose that's the final ingredient is just to get building. And and to start building and getting your product out in front of customers as quickly as possible. So you can understand whether you're actually building something that people even want.

• 4:25Harry Stebbings?

  And what can non-technical individuals do in those cases when they can't build it, say in the software case?

• 4:32Speaker 02

  So for non-technical individuals, our advice is um become a domain expert. And so if you're looking to build a tech startup, but you don't come from a technical background. Uh you need to be bringing some sort of expertise to the startup. Uh so often we find that this is domain expertise. To give you some examples from the current EF cohort. Uh we have um Karen who spent ten years working in the translation industry. And has been uh helping clients through agencies translate um uh documents, websites for years and years. And she knew intimately the problems with the translation world as a whole. And and she came on EF and and partnered up with one of our guys who had a very strong technical background.

• 5:17Speaker 02

  And and then are building a a a translation um focused tech startup. But she's using the industry expertise, the contacts and the knowledge that she had from from her work in that space. And that means that she's a she's the the kind of right founder to be building that. I suppose one of our frustrations with non-technical founders is that often we find people who have years of expertise in a particular industry, but they're not interested in using that um to build a startup. And I I think that can be an error.

• 5:45Harry Stebbings?

  And so you do take non-technical people in in general then?

• 5:49Speaker 02

  Uh just a couple. So we're about ninety percent um that come from deeply technical backgrounds. So either computer science or engineering backgrounds, um or we take a couple of self-taught developers as well.

• 6:00Harry Stebbings?

  And because you focus so much on the entrepreneur, I mean, eh am I right in saying that the idea is not necessary when you enter the EF programme?

• 6:08Speaker 02

  So we we never select based on the idea and we only select based on talent. And we do look for people who have ideas and during the interview process, we always get applicants to talk through potential ideas that they might want to work on. That's usually just to understand how they think. And we find that pretty much everyone who joins EF changes their idea two or three times at least and before they they settle on what they actually want to work on. And coming up with an idea is hard and it's it's useful to have a framework and and process around that to help you decide what to work on.

• 6:40Harry Stebbings?

  And how do you identify their talent then and what do you think makes a great founder?

• 6:46Speaker 02

  So this is something that we've spent a lot of time thinking about over the last four years of running EF. And we've had thousands and thousands of applications over the last couple of years and we're beginning to see some really um strong traits. It it's probably in many ways, it's some of the things that you expect. So we like people that have very um strong technical backgrounds and who are who have been building things in the past. Uh people who have built companies in the past and tried startups in the past. But actually, the biggest indicator of all, um much more important than intelligence or um even technical ability is mindset and how they approach building a startup. And one of our favourite mantras is is about having a growth mindset.

• 7:27Speaker 02

  So this is the idea of having a mindset where you are open and willing to learn anything. And we find founders that uh try to resist learning the kind of broad skill set that's required to be a founder. Um really struggle. Uh you need to be the kind of founder that's, um maybe you've come from a deeply technical background, but you're willing to learn how to sell. You're willing to learn how to pitch to investors. And that seems to matter far more than any of the, I suppose, more traditional traits. I think that links into um attitude to risk, it links into determination. Um a lot of these qualities that people often talk about when they're talking about founders.

• 8:04Harry Stebbings?

  And what would you suggest to someone then who's looking to find a co-founder? Obviously, your um new applicants who come in each um term that haven't got a founder or a co-founder with them yet, do they? They meet them in your programme?

• 8:17Speaker 02

  Yeah.

• 8:18Harry Stebbings?

  So how would you recommend that people network to find that perfect co-founder?

• 8:23Speaker 02

  So finding a co-founder is is hard. Um. People talk about co-founder dating or finding a co-founder is like having a shotgun marriage. Uh. And I think that's it's probably probably the wrong way to think about it. Um. So it is hard to find a co-founder and I think. You know, that's one of the really special things about Entrepreneur First is that we do have a uh cohort of, I suppose, screened individuals who are all. Um. Determined and interested in doing um doing uh the same same sort of thing. I suppose. If you if you are looking for a co-founder outside of Entrepreneur First, meeting as many people as possible. Um. And in particular, meeting people outside of your network um is really important. We often find.

• 9:05Speaker 02

  Uh particularly university students um coming up with what we call co-founders of convenience, um which is largely just. I want to found a startup, you want to found a startup, we can't find anyone else that wants to find a found a startup, so let's just found co-found together. And what happens then is is you get idea in inertia, where maybe one of the co-founders isn't that brought into the idea, or neither of them are. Um. And they're just co-founding together because they couldn't find anyone else. So making sure that you expose yourself to a wide group of people. Um uh who are interested in co-founding a startup and who have the right kind of skills uh is really important. And then making sure that you test that co-founder relationship before you commit to anything. Um. And making sure that you are. Uh articulate before you start testing that relationship that this is a sort of testing period.

• 9:50Speaker 02

  Um. And that you set yourselves deadlines as to when you're going to make a a decision as to whether it's a go, no-go. Um uh with for the co-founding relationship.

• 9:59Harry Stebbings?

  And with regards to the partnerships formed at EF, um what would you recommend in terms of the partnership itself in terms of the deal and the equity stakes?

• 10:07Speaker 02

  Um.

• 10:08Harry Stebbings?

  Would you say they should always be fifty fifty?

• 10:10Speaker 02

  Yeah, so pretty much all of ours are fifty fifty. Um. One of the important things to remember about equity is that it should be forward-looking, not backward-looking. So just because you started the company two months earlier or six months earlier or that it was your idea. Um. In five, ten years' time will mean very little. And if you want to build a big, successful company. You're going to need to dedicate a significant proportion of your life to it, and you want to make sure that whoever you're co-founding with is incentivized in the same way that you are. Uh. We've seen uh not necessarily not within EF but outside of EF. Uh, you know, acrimonious co-founding relationships based on, um, I suppose unfair equity divisions or. What becomes to be seen as unfair di- division.

• 10:52Speaker 02

  Um, but I mean, at E F, we're we're lucky because, you know, everyone's starting at the same time and and they're all companies built from scratch. Um, so I I mean, our advice to our guys is it's it's fifty fifty, but I know that there are situations where sometimes um that that doesn't uh isn't most suitable.

• 11:08Harry Stebbings?

  And so now we've established a team and the founder in this situation, moving on to the very, very early days. What should teams focus on in the first hundred days of their startup? Is there kind of twenty percent that produces eighty percent of the returns?

• 11:22Speaker 02

  Uh, it's a it's a really good question, and I think it's something that a lot of first time founders struggle with is how to spend their time. And i- if you think about when you have a uh successful startup or a startup that's growing, uh you'll have a lot of pulls on your time. Um, either from customers or investors or team members. Um, but when you're first starting out, we find most of our um first time founders really struggle to know how to spend their time. Um, our piece of advice is always stop building a startup and and just build a product. So instead of worrying about all of the um paraphernalia that comes with building a startup. Um, just focus on on the product that you want to build and the customers that that might want that product. So what that means is, you know, don't worry about your logo, don't worry about your um accounting, don't worry about.

• 12:08Speaker 02

  Uh, even about getting incorporated in the early days, the most important thing is uh making sure that you're building something that people want. So uh building test versions of the product, um getting them in front of the potential customers, getting feedback. Um, looping that feedback back into the product, um and making sure that you're iterating quickly.

• 12:26Harry Stebbings?

  And with with regards to testing, so I'm just interested, do you like the the s- kind of spray and pray method where you kind of give it to everyone and. To kind of want mass feedback, or do you like a very targeted, very niche audience where you have a hundred people giving very precise feedback?

• 12:43Speaker 02

  I think feedback is a really hard one. It's easy to get wrong, uh because. If you try and get feedback from everyone, you will get a lot of disparate answers. And you need to get feedback from potential customers for the product. Particularly if you're building a B two C product, it can be easy to assume, let's just give it to anyone who's ever been a consumer and see what their feedback is. Actually, that that won't give you the right kind of um feedback. You need feedback from the people whose problem you are particularly trying to solve. Um and then listening to and condensing their feedback, uh it's much more likely that that will give you one clear direction or one. Uh or a strong indicator as to the direction you should be heading, rather than getting a ton of random views.

• 13:26Speaker 02

  From your friends, from your family, from well wishers, who don't actually, uh who won't eventually be users of the product. But they just want to be kind and give you feedback. And friendship, uh friends being kind and families being kind and giving feedback can often be very dangerous.

• 13:40Harry Stebbings?

  Do you agree with the friends and families round?

• 13:44Speaker 02

  Um, uh I mean, it's horses for courses. Uh I think that there are situations where a friends and family round. Can be um can be useful, but I think that you need to make sure that you take money from investors who understand. The way that early stage startup investing works. Um so in particular, understanding the risk profile of investing in early stage startups. Um so there's a there's a high degree of chance that you won't get your money back. But even if you do get your money back, it may take. Quite a while for any returns to come back. So if you're investing someone's, your, you know, your parents' pension, or if you're investing. A friend's house deposit, uh it's it's probably not the best best thing to do.

• 14:27Speaker 02

  Uh you know, as a as a founder, you want to be taking money from people who understand how startup investing works. And who understands the risk and how long it takes to get a return. Um and often friends and family isn't isn't the best place to find that.

• 14:39Harry Stebbings?

  And then with regards to kind of readying for demo day and for potential investments. What does EF do to make sure that the startups are ready to pitch and then are successful when they do pitch?

• 14:52Speaker 02

  So pitching, I think pitching for investment is one of those things where people say, oh, it's fine, I'll just, you know, I'll do the pitch and it'll be absolutely fine. The pitch is, I suppose, in many ways, just the icing on the cake. It's it's a way to communicate what you've done. But to be able to do a good pitch, it means that you need to have done the work beforehand to ensure that you have the right team, ensure that you have traction that proves that people want what you're building, um, to have put the work in to understand the market that you're in, to understand how you're going to sell the product. Uh, to have been tracking metrics over time to see how they're changing and make sure they're moving in the right direction. So we spend a lot of time with our guys, helping with, um, uh, in particular traction, building their teams, developing their product.

• 15:35Speaker 02

  And actually, we only start a week before, um, our demo day at Entrepreneur First, um, actually helping them get the pitches together. So it's a very, very short process, but that's because the pitch isn't the bit that matters. Um, it's important, it's the, the, um, I suppose, the, the window to the world, um, and the way to get people excited. But actually, what matters more is the work that's gone in beforehand to make sure that it is a viable, interesting, um, potentially high-growth business.

• 15:59Harry Stebbings?

  And then moving back to your own founder's journey now and looking at the amazing journey you've had. What's been the hardest aspects of growing the business and how did you overcome it?

• 16:11Speaker 02

  All right, this is, this is a really tough question, um. The, something that Matt, uh, my co-founder and I always agree on is that when you found a startup, your job changes pretty dramatically every six months. Um, you're always learning something new, there's always different problems to be solved. I mean, the problems that we had in the early days, which was, uh, I think a lot of people thought that what we were doing was pretty, pretty stupid when we first started out. Um, investing in, in people pre-team and pre-idea was not, was not the way it was done. Um, and we were told many times to do, do other things and stop wasting our time. Um, so I suppose that was one of the big challenges at the beginning and, and, uh, because of what we were hearing from our customers, so from potential founders.

• 16:54Speaker 02

  Uh we we kept going on this path, which which in hindsight was the right course. Um and now, you know, the the problems of scaling and um the uh I suppose the excitement of scaling and making sure that we build out the team, um that we have the right support for startups in place. And so there's always, there's always new challenges. It's never, it's never easy, but I think that's one of the reasons why it's such a fun job, I suppose, as a founder. Um because it's a constant stream of different problems, um it's it's high, high-octane problem solving.

• 17:26Harry Stebbings?

  And then if it's good with you, we're gonna move into a quick fire round now, where I say a short statement and you give me your immediate thoughts.

• 17:32Speaker 02

  Sure.

• 17:34Harry Stebbings?

  So the highlight of the journey.

• 17:37Speaker 02

  The highlight of the journey, uh so we just closed our first three-year fund um at eight and a half million pounds. Uh and that's been a real highlight. Uh it means that we're gonna be able to scale rapidly, um means we can build out the team and yeah, it feels, it feels like a big moment for EF.

• 17:52Harry Stebbings?

  So is that, sorry, is that a raising for the EF itself, or is that a fund that you can invest in your portfolio companies?

• 17:58Speaker 02

  It's a fund that will invest in our um in new companies, so it'll allow us to invest in about two hundred companies over the next three years. Uh all companies that will have been built through EF.

• 18:07Harry Stebbings?

  And how many companies go through EF a year at the moment, would you say?

• 18:10Speaker 02

  So we're just scaling up from producing about uh fifteen companies a year to producing about forty companies a year, so quite a big step up.

• 18:19Harry Stebbings?

  Well, congratulations, that's amazing.

• 18:21Speaker 02

  Thank you.

• 18:21Harry Stebbings?

  And who would you consider a thought leader in the tech entrepreneurship space?

• 18:26Speaker 02

  Uh I mean, one of the guys that I really uh really enjoy reading and his stuff is Tony Hsieh, the founder of um uh Zappos.

• 18:34Harry Stebbings?

  Yeah, absolutely.

• 18:35Speaker 02

  And his book, um Delivering Happiness, and then his, his work on holacracy as well is uh is really interesting. I think he's great.

• 18:43Harry Stebbings?

  What's your most read blog or newsletter?

• 18:47Speaker 02

  Uh currently it'd be the Azim Azar uh newsletter on, I think it's called the exponential V for, it's a um uh it's a good roundup of all the latest AIs by blogs or articles that have that have come out each week.

• 19:01Harry Stebbings?

  What are your must have apps or software?

• 19:04Speaker 02

  I'm on Slack pretty much about every other, every other minute, um both during the day and in the evening, uh just find it such a great alternative to email, um and then I suppose Pocket as well, uh which is a great way to store um articles to read later.

• 19:20Harry Stebbings?

  The next five years for you and Entrepreneur First?

• 19:24Speaker 02

  I think the next five years for me and EF are very much entwined, um so uh scaling, scaling EF and scaling the numbers of companies that we produce and the um the quality of the companies that we produce, uh maybe for opening an international office, um there's lots of interesting things on the horizon and I suppose for me that that means um more work, more interesting work and lots of new stuff to learn.

• 19:50Harry Stebbings?

  Well Alice, thank you so much for joining us today, it's been absolutely fantastic to have you on the show.

• 19:54Speaker 02

  No, thank you for having me.

• 19:56Harry Stebbings?

  What a phenomenal insight provided by Alice there into the world of Entrepreneur First, but before we leave the show today, we always hear the team is the crucial element to any startup, and that is correct, but so are you as the individual, so make sure you are legally and financially protected in the event of a founder breakup by heading over to Vidal Law on www.vidallaw.com. They are not the type to drag things out through court and will strive for the most amicable conclusions in the best interests of you, their client. So email my dear friend Chris Werner at C Werner, C W E R N E R at vidalaw.com.

• 20:35Harry Stebbings?

  And as always, you can find the show notes for today's episode on the blog at www.the20minutevc.com. And thank you so much for your continued support, we so appreciate it and can't wait to see you in the next episode.