Interview with Jesper Jarlbæk
With specialties in General management, strategy formulation and execution, ownership structure, corporate governance, mergers and acquisitions- Jarlbæk works on the boards of a number of Danish investment groups including CATACAP, DanBAN and FALCON. Meet the Angel investor looking for companies to advise and grow!
Hello Jesper, would you introduce yourself and the funds and networks that you are currently on the board of?
Hi. I am Jesper Jarlbæk. This is being recorded in January 2019, so it's the middle of winter here in Copenhagen. It's a very dark night and the snow is blowing outside, and so you're not going to get any sunny backgrounds from me, I'm afraid.
I am chairman of the Danish Business Angels, which was formed in 2011. I've been chairman ever since. It's now the largest network in Denmark and we have about 190 members, and this year we'll be doing investments in the region of 30 million euros of our members' money, maybe 35.
Apart from Danish business Angels, I am the vice chairman of the Danish Venture Association and I sit on the board of directors of EBAN which is the European network for business angels.
Apart from those honorary positions, I have a portfolio of about 25 companies and serve active as chairman on six of those. Additionally, I am the chairman of CataCap, which is a private equity fund in Denmark, which has just raised its second fund of 200 million euros, 240 actually, and I also sit on the board of Polaris III which is another Danish private equity fund.
So this is in short the positions which I have as an investor.
Where did your career begin? Did you have any mentors or professional opportunities that put you on the path to where you are now?
In terms of my career I actually started off as an accountant and a consultant with the advisory firm Arthur Andersen and I had a very good career there. I ended up as managing partner with responsibilities for the seven Nordic countries, and about eleven hundred professionals, and in 2006 I decided that it was a time for a change. I had done my career as a professional and I also the last 10 years there had done a lot of management responsibilities, so I wanted to do something else and so I decided that I would go into the early stage business investing activity.
And I didn't know anything about it or not a lot, and so actually what I did was to meet with Søren Hougaard. He is the Grand Old Man of Danish business angel investing, he is a professor at the Copenhagen Business School. He's written five books and I knew him in some part of my outer network and I arranged to meet him. It was actually at his home in his kitchen. We talked for two hours and I can't remember anything from the conversation, except one comment he made and the comment he made was that "Angel investing was a lonely business" The word loneliness did not exist in my vocabulary. I had worked in firms with 100.000 employees and I had a huge network, so the idea that it could be lonely was just so shocking, but it was very useful because what it told me was that when you then branch out as an angel investor and you're on your own, it's all about networking. And so I set about really working to increase my network and I've done that ever since. So as I say, I will always drink a cup of coffee with anyone who wants to. Whether or not I say yes to meeting again for a second cup of coffee depends however on the how the first meeting went"
Do you have any advice for early stage startups to separate themselves from the rest and stand out when applying for funding?
So angel investing is a line of work like any other line of work or you could say it's a profession. So it's not about just signing a check and praying. You know, this old technique of "spray and pray" that doesn't work.
What you need to do is you need to go as an angel to a lot of pitch events and at pitch events, you see 8, 10, 12 startups pitching. Many of them have been through accelerator programs, and part of that training has been that they learn to do their two-minute pitch or six minute pitch or whatever, and that, of course, is very good for them.
The challenge is that if you have eight or ten startups and they've all been taught in the same format and they just do it rather mechanically, it all tends to blur a bit.
So what is the advice for a startup?, I think that obviously, you need to get your message across, so you have to be able to tell in a short space of time precisely why it is that you are offering a unique investment opportunity.
There are two things I look for: One is authenticity. So do I get the feeling that this is really people who are passionate and authentic regarding the mission that they are embarking upon?
And the second thing is, what you could call cohesiveness, and that is that irrespective of which idea they have. The point is in every aspect of the business model is there consistency? Because you can do ventures in all types of sophistication, it is not about it being very complex, it can be fine if it's simple, but the point is the various elements of the business model have to hang together.
What are some of the most inspiring or unique start-ups that you have worked with in your career?
So in my 12 years of angel investing I have been fortunate enough to have had three very good exits. That point about very good exits is that it's not about the money. It's the fact that the exit, when it's successful, is the culmination of a journey which has been very successful and exciting for everyone, because you've seen the company grow through various stages and it's very rewarding on a personal level that you're giving advice and the team is following it and things are working out, so that is extremely good. Of course, it doesn't work like that every time.
In terms of two exciting things, I'm involved in at the moment from my portfolio. One is called NetHire.
They are basically taking electricians' tools and painter's tools and putting them onto the cloud. So they are enabling a sharing economy between construction firms, wholesalers and manufacturers. It's not a big company, it's about 30 employees but our partners are amongst the largest actors in each of those fields. So if we're successful it will really provide a lot of benefits for all the actors, in terms of a sharing economy with reduced capital investments, and high utilization rates.
The other is Book Boon. Is the world's largest publisher of textbooks for university students. It had about 80 million downloads last year, it has two models, One is a model where the students get all the textbooks for free, because when they download them there will be some adverts in paid for by large corporations, and the other activity is to sell curated libraries to companies, where the titles are curated to suit them"This is the areas that is really growing now.
What's on your radar for 2019? Any funding rounds or accelerators that have caught your eye?
So what's on my radar for 2019? Well, there are lots of things. I'm spoilt for choice, but if I have to mention two things I could say one is the Growth Train, which is a small accelerator in Nykøbing on the island of Falster in the south of Denmark.
They are being organized by a professor at CBS called Eythor Jonsson. The theme they have is agriculture and food. Basically the last two years they've had 150 startups applying. They run the program for 20 startups. They come from all across the world, and their focus is on food and agriculture.
And of course, that's all about sustainability and a healthy lifestyle etc. So it's very exciting to see startups which are not just bits and bytes, but which actually consist of things from the real world.
And the other thing on my radar is, in Copenhagen, we have an annual event called the TechBBQ which last October had about six thousand attendees and lots of startups and lots of good presentations. This year the Danish Business Angels will be hosting an Investor Day on Day Zero i.e. the day before the main event starts. We hope to attract a lot of angel investors from across the Nordics and the rest of Europe to come to this event, and so maybe if you're lucky or I'm lucky I can see you there. Thank you.