Today we have Sarah Drinkwater with us. Sarah is the Solo GP of Common Magic, a pre-seed/seed fund investing in and supporting founders building products with community at their core across Europe and the US. You won’t meet many with as much insight and experience in building communities as Sarah, so of course, this episode is dedicated wholly to this subject!
Jump to the parts that matter most to you 👀
00:00:00 - Introduction to the European VC Podcast
00:02:02 - From Angel Investing to Building a CommonMagic
00:03:46 - The Importance of Trust and Community Building
00:05:16 - Motivations for Transitioning to Venture Capital
00:06:49 - The Power of Adaptability
00:08:29 - Personal Resilience and Thriving in Hard Times
00:10:32 - The Challenges of Building Community
00:12:24 - Building Trust and Connecting Communities
00:14:01 - Building Community from Small Beginnings
00:17:22 - Agility of Mindset in Founders
00:18:53 - The Acid Test of Communities
00:22:17 - Building Community Teams
00:23:43 - Organizational Structures and Reporting Lines
00:25:15 - Letting Go of Responsibilities
00:27:06 - The Challenges of DAOs and Group Accountability
00:32:06 - The Importance of Hard Work and Serendipity
00:33:43 - Creating Space for Serendipity in Work and Relationships
00:35:15 - The Grind of Venture Capital
00:36:58 - Trust and Collaboration in the Venture Capital Industry
Quote by Fred Destin from STRIDE:
Great founders who know how to invest make the best VCs. It is not obvious that this statement extends to operators.
Sarah’s take (paraphrased by yours truly!):
Considering that the venture landscape in Europe is relatively nascent, with the typical company taking a decade to reach IPO, and given that operator VCs have only emerged as a trend in recent years, can we conclusively determine the validity of this claim?
It's also essential to recognize that not all operators are the same. They possess varied skill sets and operate in different market segments. Like any profession, the key for an investor, be it an operator or founder, is to understand their strengths, their niche, and where they can add the most value.
Sarah dedicated her shout out to Atomico as they were her first significant ticket into the fund. Her association with them dates back to the early 2010s when they invested in an early-stage social network company she was part of. Though the startup didn't succeed, that experience introduced her to Atomico. Later, during her tenure at Campus, Google’s East London seven-storey space for startups, Nicholas and his team were consistent supporters of both her and the Campus initiative, emphasizing its community value.
In 2020, she joined the ANGEL program under Sophia Bentz's guidance. Their continuous engagement and invitations not only boosted her confidence but also honed her skills, especially in drafting memos. It felt like a hands-on training program for her. When she conceptualized the fund, Atomico was among the ten trusted entities she approached. Their solid backing was a pivotal factor that propelled her to pursue this venture full time. Their unwavering support has been instrumental in her journey. She's built strong trust with several individuals at Atomico. While their investment focuses differ in stages, their early endorsement was crucial in shaping her path with Common Magic.
Don’t wait for permission
Bet on yourself - and then start betting on others
Don’t over-plan - you never know what you’ll fall in love with next
Q: What advice would you give your 10 year younger self?
Keep going and have fun.
Q: What are your top tips for emerging VCs across Europe who are fundraising ?Q: What’s the most counterintuitive thing you’ve learned in venture?
Build a story that makes sense, that you absolutely believe in.
Q: What’s the most counterintuitive thing you’ve learned in venture?
Sometimes it really is about intuition and gut feel versus numbers.
Johanne’s controversial statement:
A little bit of chaos is good for you.