Strange Day in UK VC World
There were 2 big stories today in the UK tech world and it was interesting to see how the VC world responded:)
Onefinestay was sold for $170 million dollars, http://techcrunch.com/2016/04/04/accorhotels-acquires-onefinestay-for-170-million/. OFS had raised $81 million dollars from numerous VC’s including Index.
Jinnapp raised $7.5 million from a variety of high net worths and some European VC’s, http://techcrunch.com/2016/04/05/jinn-picks-up-series-a/.
So basically this is a fail for all the large VC’s, including Index. who invested in late stage of OneFineStay as they will have needed the company to exit at a huge value to make it worth their time. From crunchbase and duedil it is possible to see that probably the only people that this was a success for was the early investors who were either angels or small VC’s….well done Sean at Profounders:)
Jinn is a business that has been growing at pace constantly. Steve at Techcrunch covers the data well, but for some reason all the main UK VC’s seem to not be interested.
What is confusing is that the VC world have hailed the OneFineStay sale as a success ( see here Robin Klein who also was a VC at Index – https://twitter.com/robinklein/status/717375469168017408 ) and praised Greg Marsh the CEO ( who by chance was once a VC at Index – Linkedin )
But then no UK VC has ever done any investment in Jinnapp or expressed interest. Maybe no one wanted to upset Index who backed Deliveroo or their General Manger Lenny ( who happened to once work at Index too – Linkedin ). I can understand Index not investing as it is close to the Deliveroo model and may cause a conflict of interests ( Personally this is something I always disagree with as you might as well have bets on 2 horses in the same race). Paul Smith who was one of the founders of Ignite who was the accelerator behind Jinnapp has also tweeted about this – https://twitter.com/paul_a_smith/status/717314723327447040?lang=en-gb
I know in the real world lots of deals get done with people they know and trust as it is easier and in many cases the best thing to do, but lets not build the UK eco system completely on a boys club and hail wins when they are known by the industry to be fails, as in the long run that is not a good idea for anyone.
Congrats to the founders at OneFineStay and Jinnapp as this does look like success for both of them personally.
Doug
Ps. To make it clear this is my view and I have not talked to the founders of any of the companies mentioned here or any of the VC’s about this.