Imaginary Ventures co-founder Nick Brown on the hunt for ‘founders with something to prove’
With ever-changing economic and consumer trends, Imaginary Ventures co-founder and managing partner Nick Brown wants to make sure his venture capital firm stays ahead of the game.
Brown established the venture capital firm alongside Natalie Massenet, founder of Net-a-Porter, in 2018. It is now one of the largest venture capital funds located at the intersection of the technology and retail. The company’s portfolio includes well-known brands, platforms and founders, including Glossier, Skims, Everlane and Farfetch. The company has increased the funds under its management to $1 billion. In April, it announced its third fund, of $500 million, for early-stage and early-stage companies.
According to Brown, part of Imaginary’s success has been its ability to find the diamond startup with potential for global reach. “Our approach to investing in brands has always been brand direction and product direction,” Brown explained in the latest episode of the Glossy Podcast. Brown added that the company prioritizes brands at the forefront of technological innovation and those that can adapt to an ever-changing ecosystem.
While Imaginary has had success investing in early-stage companies, it also values early-stage brands and founders who are shaping the future of customer experience.
“If you’re a newbie founder, it’s less about the detail of [a 5-year plan] and more about visioning how you’re going to get to the ladder, because that’s the hardest thing for everyone. I would say for 20, 30, 40 companies that we see, [only] one of them has the ability to hit that [$100 million] kind of scale. So you want to be really thoughtful and really confident in your articulation of how you get there,” Brown said.
Below are additional highlights from the conversation, which have been lightly edited for clarity.
The Imaginary Ventures touch
“I want to be as supportive as possible, Natalie wants to be as supportive as she can, [and] the rest of the team is exactly the same. Ultimately, we do not own these companies. We are not overnight operators. Our model does not allow this. We invest in 8-10 companies a year, so you can’t be the day-to-day operators of all of those companies the way a CEO will be. You need to be honest about this because when a CEO is looking for an investor to run their business, they need to be looking for a very different investor profile than the venture capital ecosystem. Ultimately, what you want is very specific, very targeted support that is going to vary greatly from company to company you invest in.
“[I] look for founders who have something to prove – most great founders have this in common. You’re looking for founders who aren’t afraid to hire people who are better than they are in a particular role. You are looking for founders who ideally take feedback well and listen – this is important. That doesn’t mean they have to follow the advice you give them, but it does mean they have to be thoughtful, listen to it, and encourage that feedback loop. Looking for founders who are nimble and ready to pivot in some difficult times…. This is the difference between a folding founder and a surviving founder. These are the types of founders who will not only survive, but they will thrive in times like this. »
take a step back
“I want everyone to lead with patience. It may sound corny, but it really matters at times like these, when the market is changing at such a rapid pace and the consumer is in such a state of uncertainty. We don’t know what consumer spending will look like over the next 12 months, so we have to be patient. You must be patient in your pace of researching new businesses, and you must be patient [and understand] that it will take a little longer for your existing businesses [to scale]. This must be a driving KPI for everyone. That’s what I focus on the most internally.