Steffen Wagner, co-founder of Verve Ventures, has just been named digital shaper 2019 by Le Temps and BILANZ. Verve Ventures is increasingly recognized as a role model of how the venture capital industry is transforming. In this article, he sets out in four points how Verve Ventures has built a highly scalable digital venture capital platform – and how technology helps looking for startups, making investments available for a wider investor base, and manage the post-investment phase.

Steffen Wagner
Co-Founder & Co-CEO, Verve Ventures

As Verve Ventures’ co-founder and co-CEO, Steffen’s ambition is to build the world’s most innovative venture capital firm. Steffen is also member of the Advisory Committee of the Swisscanto Growth Fund and is part of various selection committees, e.g. of the Swiss business incubators of the European Space Agency and the one of CERN. As “Vertrauensmanager” of the Foundation of German Business (“Stiftung der Deutschen Wirtschaft”) in Switzerland, he helps select entrepreneurial talents with a sense of responsibility for the broader society for scholarships.

1. Verve Ventures has built a digital screening process, but it doesn’t replace humans.
Verve Ventures is a data-driven venture capital firm. To identify promising startups, we’ve built a startup repository based on hundreds of startup-specific data points collected every day. This allows us to reach out specifically to those companies that meet our investment criteria, in particular regarding a team’s track record. It also allows us to reach out at the right time, usually before a financing round is about to be initiated. Some examples of data points collected are the following: We know which startup has just won a big client or award, when we last contacted them and how they have developed since e.g. their revenue increase or at which valuation their last financing round took place. Our screening algorithm also takes into account referral quality and investor interest. Data from our repository also feeds our internal tool to conduct due diligence and create decision reports. But we do not rely on technology entirely to make the final investment decision. This is still done by our investment committee which includes not only seasoned VC transaction specialists but also the heads of our private and institutional investor teams. Our tools ensure that human bias is eliminated as much as possible and that decisions are based on evidence and facts.

2. Verve Ventures has built a fully digital investment process that allows us to handle thousands of individual investment tickets per year.
To be able to offer access to venture capital investments, we’ve implemented a smart mix of “FinTech” and “RegTech”. New investors are onboarded digitally and can identify themselves with a video call. They find all the information about the startups on our digital platform. And if they want to make an investment, we’ve built tools that streamline the signing of the investment documents. Everybody hates shuffling paper and so do we. Investing in a startup used to be a very cumbersome process for all parties involved, with term sheets and contracts going back and forth between them. This is why we founded and built the first fully digital fiduciary to pool smaller investment tickets. All in all, we made VC investments almost as easy as ordering online. We’re not far away from a “one-click investment” process. And last but not least, Verve Ventures’ platform also gives investors a consolidated overview of their startup holdings, including valuations, reports, and updates from portfolio companies, even tax reports.

Invest in Startups

As one of Europe’s most active venture capital investors, we grant qualified private investors access to top-tier European startups. With investments starting at EUR/CHF 10’000, you can build your own tailored portfolio over time and diversify across stages and sectors.

3. We’ve built a very large and highly sophisticated investor community. Leveraging its strength for our portfolio startups is possible only because of digitalization.
Verve Ventures has become a large and sophisticated investor community and we welcome dozens of high-caliber new investors to it every month. This is possible only due to digital processes. It allows us to build investor syndicates with network and experience targeted to a specific startup. Once a financing round is done, we help our new portfolio startup to succeed and create value for its shareholders. The biggest value generators are access to potential clients and recruiting the best people for key positions. Since our investor base consists mainly of C-level executives, seasoned entrepreneurs, and domain experts, we’re able to open many doors and do high-level matchmaking at scale.

4. With the digital tools we’ve built, we’re ready to rapidly scale our business and become Europe’s leading digital VC firm.
Verve Ventures has honed its digital investment model in Switzerland since 2010. With over 100 financing rounds, we’ve become the most active early-stage investor. We’ve built our tools and team of investment professionals to the point where we’re now able to consistently source not only the most promising high-tech startups from Switzerland but from all over Europe. Soon we’ll close our 12th international investment and there are many more in the pipeline. The power of Verve Ventures’ model will become evident once we’ll have a significant amount of startups and investors from all European countries. This will allow us to break the barrier of  CHF 100 million invested per year soon, and it will benefit the whole European startup ecosystem. Our long-term vision is to facilitate CHF 1 billion per year, and this is only possible with a fully digital investment process that will empower even third party VC teams to invest smarter and more efficiently.