Introducing the Hillfarrance Scout Programme
Ever since I had the idea of creating a new venture capital firm in Aotearoa, I was determined to ensure that it served all of the population, especially the Māori community. With my own son being part Native American, I have a huge respect for indigineous cultures and their belief systems. In my kōrero with many tribal members of the Iwi up and down the country, it became evident that the Māori's holistic views of the world, especially those concerning kaitiakitanga (guardianship, conservation and ensuring multigenerational reciprocity) and rangatiratanga (enhancing leadership and participation in the community), should be critical to any venture capital strategy.
To this end, when I created Hillfarrance Venture Capital, I wanted this firm to not just be a source of capital and resources for entrepreneurs, nor just a great investment vehicle for my investors, I wanted Hillfarrance to fill a gap in the New Zealand startup ecosystem - to provide a platform to grow Aotearoa’s next generation of VC’s. This platform is called the Hillfarrance Scout Programme.
What is a Scout Programme?
Relatively commonplace in the California venture capital market, scout programs are created by venture capital firms and give a set of exceptional individuals money to invest on their behalf. Yes, we are providing capital to people to go out and make their own venture capital investments!
The reason why we offer this programme is:
We want to expand our horizons. We want scouts to invest in verticals and markets that our typically outside of our usual enterprise focus. This ensures that we maintain our position at the very frontier of technology and new developments. There are few things more satisfying than learning about a new sector or innovation from a scout who is really close to the technology.
We want to identify and support the VC’s of the future. As our fund expands, so does our team and our Scouts are wonderful potential new colleagues. The program offers the Scout and Hillfarrance the chance to get to know each other and understand what makes us tick. VC’s aren’t created from an undergraduate degree, but instead from personal experiences and the entrepreneurial ‘muscle memory’ that they create. Even if you don’t join Hillfarrance, the more smart investors there are, the better it is for everyone in the ecosystem. The rising tide lifts all boats.
We want to be there first. Venture capital is a competitive industry and we want to be able to invest our capital into the most promising founders first. As our core fund typically invests at the seed and/or A-round of a startup, we want to grow our knowledge of a startup team even earlier, through an investment from our scout program. If we all smash our goals, we may even want to lead your seed round.
How does it work?
It is a relatively simple:
A scout will identify a team and an idea that is worthy of investment.
The scout will undertake comprehensive due diligence on the company, team, technology, market and product road map and compile a report that is presented to the Hillfarrance team for opinions and feedback.
The Scout decides to proceed/not to proceed with the investment and Hillfarrance wires the money to the startup.
Once the company exits or creates dividends we will split the returns that Hillfarrance generates from the investment with the scout and we all buy that bach on the Coromandel!
What does an effective ’Scout’ look like?
The most effective scouts in Silicon Valley have been Founders and serial entrepreneurs, former institutional investors who want to try the other side of the table, and well-connected individuals who have unique access to groups of people who are pursuing really cool things.
For example, in 2007, one of Sequioa’s first scouts was a serial entrepreneur who had just raised $20m from Sequoia and others for his search engine startup. That individual was Jason Calacanis and he had made a handful of recommendations to Sequoia about interesting founders, both of whom they passed on. Those entrepreneurs turned out to be Ev Williams, the co-founder of Twitter, and Mark Pincus, who was just working out how to build Zynga at the time. This prompted Sequoia to sign Calacanis as a scout alongside some other entrepreneurs such as Sam Altman (former President of Y-Combinator and now AI Machines), Brian Chesky (CEO of Airbnb) and founders, Arash Ferdowski and Drew Houston (who co-founded DropBox).
Calacanis’ first deal referral was a startup company that he described in two words: “cabs suck”. That company was called Uber and the small scout investment that Calacanis made helped shape his career as an angel investor extraordinaire. He has also gone on to raise his own funds, including two $10m funds and a recent $30m vehicle.
What excites me about the New Zealand entrepreneurial ecosystem is that we have talent in so many different pockets of the community:
New Zealand has probably one of the most active and engaged angel investor communities in the world, with hundreds and possibly thousands of individuals who have already made a number of good investments and are looking to take that next step to a more defined career in venture capital.
New Zealand has already created a number of wildly successful companies and I expect that to continue to trend upwards. Founders of successful startups often forge mentor relationships with other founders who are earlier in their career and these represent exciting investment opportunities.
Organizations and communities like the Ministry of Awesome, Kea and the Edmund Hillary Fellowship build relationships all over the world with interesting people solving hard problems that matter. I think that the people who build and run these groups will make for highly effective scouts.
Regardless of their origin story, a good Hillfarrance scout has an insatiable curiosity about new ideas, a natural ability to connect deeply with people, and a character that fits that fits with the Hillfarrance culture - humility, passion and a sense of family.
What does Hillfarrance provide each scout?
We think that successful scouts are grown and we will be providing all of the tools and resources to help our scouts to grow into top investors. This includes:
Regular 1:1’s with the Hillfarrance team and group sessions for scouts to share knowledge and ideas.
Private seminars with other leading investors from across the world to pick up best practices and expand networks.
Access to a marketing budget for hosting small events and dinners.
You will receive the highly coveted limited edition Hillfarrance backpack!
How do I apply?
All you need to do is send an email to email@example.com, with a brief bio or CV and a short paragraph about why you would make a brilliant scout. We will be reviewing applications and selecting our first scouts by the end of August, 2020.