What it's like to get investment through the Coutts Investment Club

Back in February 2017 James Dean, the founder and CEO of London-based AI startup SenSat, was seeking his first round of investment. He was looking to raise £850,000, with the first £300,000 soon arriving from the Swiss family office Pubal Consult, leaving a £500,000 hole to fill for the former investment banker turned budding entrepreneur.

“Really weirdly over that summer we had an intern from London Business School,” Dean told Techworld over the phone last week. “She was interning from an MBA programme with lots of other people, some of whom were at VC funds. They were all meeting up for beers and they got chatting, as you do, when one liked the sound of our company and said they should set up a meeting.”

SenSat cofounder James Dean
SenSat cofounder James Dean

The rest of the seed round was eventually filled by four investment firms, including Force Over Mass, Round Hill Venture Partners and Zag (the venture arm of global creative agency BBH); three of which were introduced by that very intern.

“That’s got to be the best ever return on investment from an intern,” Dean said.

While most would consider that an extremely successful fundraising, Dean was worried about the lack of angel investors – the sort of individuals who tend to supply with not just capital but also bring a wealth of experience and valuable contacts to the table. After an aborted deal with a “large VC firm based in the Valley, with a London office run by ex-Microsoft guys” Dean and his team started looking for alternative routes to investment.

Coutts Investment Club

That’s where the Coutts Investment Club comes in. Launched in 2014, the little-known, invitation-only part of the 300-year-old private bank – now part of RBS Group – connects a few hundred of the bank’s high net worth clients with handpicked UK companies to invest in.

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Again, as fate would have it, one of SenSat’s sales executives had a brother who banked with Coutts, who made Dean and his cofounder Harry Atkinson aware of the Investment Club.

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The criteria of the club are strict however, with just 10-15 companies a year being selected, something Dean found out the hard way when he was rejected at the first time of asking. But by March 2018 his company qualified for consideration.

Coutts did its due diligence and set up around 15 meetings at its Strand office, leading to SenSat taking on seven new angel investors: an Irish billionaire, a Kuwaiti billionaire with a valuable background in construction, two investors from equity backgrounds, and three more from Brazil, ballooning that seed round by around £1.8 million.

“I use that network as mentors too, they are well connected people with good feedback,” Dean said.

For example, one Brazilian investor has already set up meetings with the biggest oil company in the country, as well as one of the largest mining operations there.

For its trouble the bank charges a five percent success fee on any money raised, “but really they do it because it differentiates them in the private banking market,” according to Dean.

“I can’t speak highly enough of how they do lots of upfront diligence,” he added. “They produce summary packs that go to clients, they set up meetings and do follow ups, so all I would do is turn up and pitch.”

Hans Prottey, who heads the Investment Club at Coutts said: “SenSat’s technology has huge potential and we were delighted to support them. It is exactly the type of innovative, high-growth British business we look to introduce to our most sophisticated clients – who, in turn, bring their business expertise to the table as well as their financial backing.”

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What is SenSat?

SenSat essentially builds digital copies of physical environments, where artificial intelligence models can be released to help understand their paramaters and provide valuable feedback.

The one-line mission statement is: “To teach computers how to understand the physical world we all live in.”

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One of the company’s early clients is a large UK construction company specialising in road-building projects.

“When they build a road they need to understand how much soil has been moved from A to B,” Dean explained. “The problem is measuring that in the physical world takes a lot of time. By digitising that we can start to analyse it as a machine-readable environment. So where it used to take them five days to measure 5km of road… we can give you an idea in two hours.”

The team consists of everything from astrophysicists to its CTO, Alvin Chua, with a PhD in Condensed Matter Theory and a BSc (Hons) in Theoretical Physics from Imperial College London.

Fundraising lessons learned

Dean had some pearls of wisdom to share for fellow tech entrepreneurs who are maybe considering their first round of fundraising.

“I think there is almost no advice I can give, you just have to experience it and go out and meet people,” he said, “getting good at fundraising is an art not a science, so you will have to fail a lot of times and get lots of notes.”

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He recommends setting up 10 to 20 meetings that “don’t matter anyway, so you get better at pitching and answering questions” before taking the meetings you are most excited by.

That being said: “It is a necessary evil of venture-backed tech businesses, and if you don’t want to do it you need to find someone that does.”

What next?

When SenSat does look to raise another round of funding, Dean is feeling bullish. “I see value in the Coutts investors and expect them to follow on, but we have probably accelerated on to the deep pocket stage beyond what the Coutts guys can do,” he said.

“I guess I would say there are incredible highs and great lows, but as long as you are continually learning and excited by what you do you will probably find the momentum to get through,” he concluded. “Fundraising is hard but it has been a good time to do it over the last few years, so there is a mountain of money out there if you have great ideas, so it is an exciting time for all.”



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