Hoxton Ventures was founded in 2010 by Hussein Kanji, who saw a gap in the market for venture investment in Europe, particularly at the seed and pre-seed stages. Europe had some emerging tech company successes like Skype and Spotify, but there was a need for more capital to support early-stage startups. During that time, VC was booming in the US, and Hussein felt it was just a matter of time before startup investing gained momentum in Europe. It took three years to raise the firm’s first fund, launched in 2013. Today, with three funds, 80+ investments, 15 exits, and $450M in AUM, the firm is finding Europe’s best early-stage tech startups and building them into considerable revenue-generating, category-defining companies. We believe great companies are built by great teams, not venture capitalists.
I started in an advisory role at Hoxton in 2022 before moving over full-time after a career in consulting and operational roles at Google and Nest. I was drawn to the firm’s focus on long-term impact and the opportunity to support European tech companies. I enjoy working with founders for the long run and seeing the “rest of the story” – something I rarely saw in the project based environment of consulting. In my role, I feel that I can impact teams, companies, products, and the European tech ecosystem as a whole.
What are your focus areas and industries at Hoxton?
Hoxton is a team of generalists and sector agnostic, but the firm is heavily invested in AI, deep tech, enterprise SaaS, and tech bio. We pride ourselves on identifying and investing in promising sectors ahead of the curve. Hoxton was actively investing in tech bio before the sector even had a widely recognised name. Similarly, our partners were early advocates for the convergence of services and AI, a trend that is now widely embraced. Personally, I am looking at sectors including fintech, consumer, and hardware. Some of the companies I have been involved with include FinsterAI, Roli, Deblock, Fluent, Raptor, Giraffe360, Inoviv, Limbo and more.
What do you look for in a founder?
Hoxton focuses on startups seeking to invent new market categories or transform large, existing industries.
We look for founders with deep expertise and knowledge in their field, who know how to build a strong team, and who also have commercial aspirations, ambitions for global scale, grit, determination, and resilience. They don't necessarily need prior commercial experience, but we like to see founders with big, global ambitions for their businesses.
Can you talk about your current portfolio?
Hoxton was early into AI and deep tech with companies like Avantia Law, Druid and Peptone, and we are now doubling down with others such as Cogna, Malted, Finster and Cusp.
Two of the characteristics we look for in potential investments are new category creation and US commercialization. And if our companies are not looking to the US first, then we often encourage them to pursue rapid international expansion. We help European companies expand internationally through our first-hand operating experience and vast network in Silicon Valley and beyond.
For example, we invested in Darktrace who expanded to the US before they had won their home market in the UK. Then in the case of Phagos, a French techbio company, they are expanding into North America and Southeast Asia with the first commercial applications of phages in the two largest commercial markets in their category; Deliveroo, expanded into Asia and the Middle East after initially launching in the UK; and Deblock, a company that has built the first of its kind non-custodial wallet for crypto, has launched in France.
What does the future look like?
There are several trends we will see in the near future. For one, I believe the increased governance of cryptocurrencies will further validate blockchain technology and its potential applications. We'll also see a rise in defense tech investments, as Europe has historically underinvested here and is now looking to catch up. Finally, cybersecurity is another area that will see continued growth, especially with the advancements in AI, which, unfortunately, can also be used for malicious purposes and will need to stay one step ahead of bad actors.
What are your predictions for the future of VC investment?
I believe the venture environment is healthier after the frothiness we saw in 2021 and 2022. Average returns may be more nominal, with high performers continuing to deliver outsized gains. VC firms will have to work harder to earn their returns, but I think that's a good thing overall.
How are you and Hoxton Ventures different from other VC firms?
We consider ourselves a European venture firm with a Silicon Valley mindset. Many of us have a strong connection to Silicon Valley and deep operating experience at companies like Google, Microsoft, and Nest.
We also tend to be more company-focused than just founder-focused, putting the needs of the business first. Often, our work is providing a sage perspective that comes from living through multiple market cycles, and having the forthrightness to hold honest conversations others shy away from. Once we invest, we work hard behind the scenes to maximize value. We provide introductions, help make critical hires, provide market intel, ink strategic partnerships and handle difficult operational issues.
What advice would you give to founders?
My advice is to be selective about who you take VC funding from, as VC funding is not always the right path for every business. Do your homework to understand which funds are the best fit. Within the firm you choose, make sure to find the right partner who will champion your startup. This will be a long journey. Sometimes, the time between a seed round and IPO can be similar as growing up from adolescence to adulthood!
Finally, pick the right partner. And that’s not just the right firm, but also the right champion within the firm. You are starting a relationship and you want to build it to last. Be open to feedback and perspectives from your investors, as that can really help improve your business. And above all, stay resilient and hungry in pursuing your goals.
Payton Dobbs is a Partner at Hoxton Ventures.
