Laura Faulconer, portfolio director at x15ventures, leads a team responsible for growing and maturing the x15 portfolio, providing strategic support to help scale existing ventures, and scouting for new and emerging opportunities.
She’s led the portfolio function and healthtech and deeptech investmets at Antler, and managed investment at NZ deeptech fund WNT ventures. She co-founded The Actuator, Australia’s first national medtech accelerator, and designed and launched The Generator, Monash University’s flagship entrepreneurship program.
In August, Faulconer joins SmartCompany as a guest judge at the Pitch, our early-stage startup competition. Here are her two cents on the startup funding landscape, and her tips for founders pitching to VCs.
How are broader economic forces shaping the landscape for you and for startups?
While economic storm clouds continue to gather, I’m still optimistic. There are multiple disruptive forces at play (macroeconomic-driven, like inflation and an overall contraction in available venture funding, and tech-driven, like generative AI and an increasing need for sophisticated cybersecurity).
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History suggests this will be fertile ground for impacts over the horizon. Combine this with an early-stage investment landscape that has remained resilient, and I believe we’ll start to see the transformative opportunities materialise faster and stronger than in previous eras.
Three spaces that I’ve seen squarely holding ground in the corporate boardroom lately include sustainability, cybersecurity, and generative AI.
Sustainability: There’s a very pressing need for solutions to help Australia transition to a net-zero emissions economy by 2050, a goal that’s likely to require trillions of investment dollars. There’s a burgeoning climate tech ecosystem forming here in Australia, and whether it is carbon finance, technology to measure emissions or another angle, sustainability is an important focus area.
Cybersecurity: Embracing cybersecurity as a top priority has become mandatory, with security by design at the core.
Generative AI: A huge opportunity space, with the potential to transform almost every industry imaginable, but one that ought to be explored with the right degree of caution and responsibility.
What are you looking for when keeping an eye out for new startups?
At x15, we build, buy, and invest in startups that would benefit from connections to the Commonwealth Bank, and could improve the lives of its 16 million customers. Typically, this either means fintechs disrupting the core banking experience, or digital solutions not traditionally associated with banking, but with the potential to extend CommBank’s relationship and relevance with its customers.
When looking at the opportunity itself, strategic alignment is most critical, followed by the credibility of a responsible growth trajectory that will solve big problems for our customers (or solve big problems for us that enable us to better serve our customers).
But, the opportunity features are easier to assess. Exceptional teams are the differentiator, especially in a model like ours.
The space between startup and corporate has massive potential but requires founders and the startup leadership team to balance competing priorities in the strategic partnership with the corporate versus startup risk appetite – but without overly hampering the attractiveness of the speed and flexibility possible in a startup. It’s a fine balance that requires a specific skill set and mindset, especially resilience – so we pay close attention to the team.
What’s your advice to fintech startups looking to get their pitches heard, picked up, and funded?
Your view of the customer problem should be nuanced, with that nuance underpinning your competitive advantage. To get to that nuanced view, spend real time observing the problem from all angles.
When you’re explaining how you’re going to solve that customer problem to investors, position your strategy against ‘value inflection milestones’ – for an early-stage venture, these are key achievements that materially de-risk your business (and therefore represent a positive inflection point in the value of your business).
For example, at the start, a value inflection milestone might be demonstrating a minimum viable product with strong stickiness signals, or a bit later in the journey this could be achieving a consistently strong revenue growth rate at breakeven opex. Ideally, a funding round will get you safely past a value inflection milestone.