Investors should not purely finance, but also help entrepreneurs succeed
The greatest asset of any company , is its people. Passionate people who make a difference to others, the company and society. With this in mind, we decided to highlight one of Seed Capital’s heroes and a major contributor, Anne Cathrine Wilhjelm, Partner and Attorney, who has been a vital part of the Seed Capital adventure since its very beginning. She has a legal background and 18 years’ experience of working in the start-up venture capital field. She has been involved in many Danish Start-up Venture Capital investments, if not the most. Her long-standing experience, both in Denmark and internationally, is undoubtedly of great assistance to our entrepreneurs and investors. In this post, we would like to learn more about Anne Cathrine and her aspirations, of which we are sure founders might gain some value.
Q: What is your professional background?
A: I graduated from the Faculty of Law at Copenhagen University, followed by a post graduate law degree Master of Laws (LL.M) at Vrije Université in Bruxelles, specializing in Comparative European Law. My expertise in this European perspective of the law is something I value highly — as it is an exciting and challenging area.
In the early years of my legal career I was employed by Kromann where I worked in the areas of business law, company law and intellectual property rights and competition law. It provided me with a very good grounding in these legal arenas. I left Kromann after 6 years and took up employment with Ørsted as they went from being a monopoly to being exposed to competition. I left Ørsted in 2000 after a few years to engage on a startup-journey.
I went from working in a big company with a very secure position to a very vulnerable new start-up. Later, in 2003 I was hired under a temporary contract to work within the innovation environment — and a year later I became part of the team in Seed Capital’s first fund. My main task was to ensure that all legal aspects were in order and that matters were handled professionally. I am still there, working with entrepreneurship and venture capital, 18 years later — and never a dull moment.
Q: What made you so interested in working with venture capital?
A: From the very beginning I became involved in the whole cycle from startup, growth and finally exit. Whereas an external lawyer usually gets involved for a short period of time only, I realized very quickly that I felt passionately about being involved in the entire process and all facets of our business. I want to be part of the journey all the way. I want to guide, with my legal experience, and help my super talented and amazing colleagues and our entrepreneurs to achieve their very best from Investments to Exit — and all areas in between.
A useful addition to my skill-set is my experience from both sides of the negotiating table. I have seen what it is like to be an entrepreneur and I also represent the investors Interests. It is so important to understand the different roles and I understand the aspirations of both parties. This is the only way to find a satisfactory, profitable win-win solution for all.
Q: What role / tasks do you have in Seed
A: Throughout my career at Seed Capital, I have been involved in the legal aspects of the venture capital business. Nothing is signed in Seed Capital that has not come across my desk.
I have been involved in raising the Seed Capital funds and all our investments — and the exits. As a partner it is clearly my duty to ensure that all investments and investment decisions are professionally handled and legally sound. I am also very much involved in raising the Seed Capital funds and ensure that we get a fair and equitable deal for both our Limited Partners and General Partners. Additionally, I need to ensure that my colleagues are equipped for their roles in the boards and their work with our entrepreneurs — and that the entire team operates in compliance.
Q: What has been the biggest highlight of your time at Seed Capital?
A: It’s hard to say. I have been involved in approximately 800–1000 investments and capital increases, which have ranged from relatively small to huge transactions. But, upon reflection, it is most probably the exits and IPOs — these moments when you celebrate our cool entrepreneurs’ exit — and we get to give money back to our investors. Big highlights were some our large exits, such as Endomondo, Mofibo, Fullrate, Firmafon — and now Trustpilot’s IPO at the London Stock exchange. Trustpilot was very special as we were a part of that journey for so many years.
Q: You are working in a quite male-dominated industry, how has it been, and can you put a few words on the issue of diversity?
A: I have experienced some situations that in part have felt discriminatory. When I worked in my early years as a lawyer and came to meetings, I was looked upon as the secretary. I just took it on myself, poured coffee for everyone, and thought it was fine. Then I would knock their socks off by taking the stage and giving them a first-class presentation. That cured the problem; with professionalism you can get far. In those years most lawyers were largely men in suits. Fortunately, this has changed and there are now a lot of very talented women in the legal profession.
However, we still need more women joining boards and taking the leap as entrepreneurs. Clearly one cannot take gender or ethnicity-based investment decisions. Ultimately only qualification and great entrepreneurship matters, but I would nevertheless want to encourage and invite women to present their pitch for investors. If there is a founding team with a woman on board and we think it is an exciting venture case, then we will prioritize to meet them. We believe that diversity and a diverse policy is a good thing in terms of the possibility of success, as studies show that chances of success are greater in diverse teams. However, when you invest in tech companies, as Seed Capital does, the underlying deal flow does not always make it easy. Our Limited Partners also demand of us as a fund that we have an Environmental, Social and Governance (ESG) policy which we prioritize — and we require that our portfolio companies have a diversity policy.
Q: Can your share some relevant points concerning your experience with both Danish and international investments?
A: I have been involved with various companies located in the US, England, Sweden and Denmark. These countries have different approaches to legislation. Denmark and Sweden are of course quite similar, but the difference between American and English contracts is huge — and English law and contracts are a bit easier to handle than American ones. In these cases, it really requires that you have some good people to assist you, that you are well prepared and have done your homework. You have to listen to the other ways of thinking, in order to understand how you can operate in foreign countries, and here my long-standing experience is a great benefit. I have handled many different cases and learned that it is not because we do things fundamentally differently, but rather that you gain a deep understanding of their framework
Q: What are your main learnings that you think are relevant to entrepreneurs?
A: One important learning is always to ensure that all legal matters are in order and handled professionally right from the beginning. Keep track of your financials, documents and agreements. Possibly get help from someone who has been down this road before. It is so much easier to get funded if you are in good control of your business. In my opinion, get good legal assistance early on. It pays off in the long run. Even if you are really good friends as founders or in a partnership, and you think you have made a really good deal, do ensure that it is on a proper professional and legal contract basis. You may not be friends forever, even if you are founders together or have great investors. Be sure to get good professional help. Also, it can be really difficult to get funding if you have a distribution of ownership that is completely skewed, and you cannot get rid of the dead ownership shares. Further, you often change direction as an entrepreneur, and you need to be able to terminate your agreements with a fair notice and without it costing you a huge amount of cash — or your business.
It is also important to listen to your investors and to actively use their expertise. Investors should not purely be there to invest money in the business, but also to help entrepreneurs succeed. So as a founder, you should choose investors who has been on similar journey many times before and then make sure that they are there for you and your business. Not everyone is that. We, at Seed Capital, are happy to help with all our competencies. I often receive phone calls from our entrepreneurs in the portfolio who need help or a second opinion on legal issues — and I am always happy to help.