The next generation of investors looking for impact: interview with Lauri Kokkila

Recognized as one of the youngest VC partners in Europe, Inventure’s Lauri Kokkila is part of a new wave of younger partners popping up to connect with the next wave of entrepreneurs. Lauri’s trajectory to becoming a partner is unique. He started as an intern at Inventure in 2015 and just rose to Partner – all before hitting 30.  

Lauri led Inventure’s investment into Swappie (Financial Times’ fastest growing company in Europe), stepped up to chair the board at Umbra (exited to Amazon), and recently did a secondment at Inventure’s portfolio company, Material Exchange, where he was VP of Growth. Quite the portfolio! 

We recently caught up with Lauri and he shared his intern-to-partner career path, his operational experience with a secondment, and growing as a VC along with his investments.

What first got you into investing? 

When I was a student in New Zealand a few years ago, I got close with a really wild brain-computer interface startup operating there. It was then that I realized the potential of startups to solve real impactful problems. As I got deeper into that world, I was really passionate to see if a career in venture investing would be possible.

As soon as I returned to Finland in 2015, I saw that Inventure was looking for an intern and applied immediately. I’ve been working for the firm ever since if you include a one-year secondment at one of our portfolio companies.

I got into investing to help solve big problems. What keeps me going is seeing the real tangible impact that our investments are making. For instance, Swappie is significantly reducing the 146 million tons of CO2 emissions produced by the smartphone industry due 83% coming from manufacturing, shipping and first-year usage.

Going from intern to partner in your twenties is what can be described as a pretty meteoric rise and an impressive trajectory – tell us about the most memorable hurdles/challenges and surprises you encountered as you transitioned from one role to another within Inventure. 

The more I have gotten into VC, the more respect I have for founders and investors alike. Both jobs are hard, extremely hard.

A central moment in my journey in VC is when I started to consciously recognise how my “pattern-matching” of successful companies started to look. When you can start trusting that intuition and conviction building process, this work changes dramatically and it takes at least 500 startups to get there. While we looked at Swappie, multiple VCs told me great rationale on why we should never invest, but we had built together at Inventure such a strong conviction that, although we listened, we were ready to full steam ahead.

Do you think that your age and/or career trajectory have given you an edge or valuable insights in your investing decisions?

I think so. I am a big believer in diverse investment teams in VC. Keep in mind, that we are investing in early-stage companies that will mature to their fullest in the 2030s. When these investments mature, GenZs will be the core users since they will already represent 30% of the workforce in 10 years! What will that world look like?

If we want to find outliers, herd mentality is really dangerous because you need a contradictory view of the world in order to spot those opportunities. Age is one angle to diversity, and my lack of grey hair may help me spot different kinds of opportunities than more experienced colleagues.

What’s the first thing you look for in a potential investment? What is the one question you ask yourself when assessing an idea, a start-up for potential investment?

At Inventure we invest early stage with a focus on the Nordics and Baltics. And at the early stage, it’s all about team-opportunity fit. I ask myself: if I could put together a dream team to build the startup to tackle this opportunity, what qualities is this team missing? No team is perfect, but if I feel there is the capability for the founders to recruit or develop, it’s already a good start.

What has been your greatest achievement/s as an investor or at Inventure so far? 

I think my proudest moments are hard to share publicly- for instance, the times when I’ve worked closely with a founder to solve a really complex problem. But as an investor, I’m humbled to have led our €5 million Series A-round to Swappie when they were at €8 million in revenue and 70 people. 3 years later they employ more than 1200+ people and have raised over €140 million in funding- topping the Financial Times’ fastest growing companies in Europe list!

What sets Inventure apart from other VCs?

First, we’re a diverse, international, and experienced team of 17 people in Helsinki & Stockholm covering the Nordics & Baltics. We’re a local team with a global mindset. Second, we have a killer operations team that supports founders in Talent & Expansion. And beyond that, we have a solid track record: 17 years, 70+ companies, over €1 billion capital raised by portfolio companies including the likes of Wolt, Swappie, Aimotive, Detectify & Blueprint Genetics.

What are your investment criteria at Inventure? 

Investment criteria in short: team, go-to-market, and market potential, product and tech, traction and business model, deal

There are multiple ways startups can stand out and most of them are common sense, but I would highlight crazy ambition-level to go for the next moon-shot and the ability to communicate that vision effectively. Startups go through massive ups and downs, and often the founders’ compelling vision can be the glue that keeps employees, customers and investors believing in the company through the tough times.

Another one is a superior understanding of what drives the business and translating this to KPIs or unit economics. Even in the earlier stages, it is possible to draw some compelling conclusions based on a limited set of data. For instance, understanding in detail what drives retention or usage of the product shows a deep understanding of the problem at hand.

How should founders (and startups themselves) prepare for fundraising?

The list is long, but here are a few tips:

  1. Build the equity story (i.e. why should someone invest) on a piece of A4 before creating a deck. Writing brings clarity of thought in many cases. The deck is then just a representation of your equity story.
  1. Modern VCs respond to well-written target emails. Warm intros still have their place, however, at least I respond to all emails directed to myself. VCs should be accessible to anyone, not just someone with the right network.

3. Choose the right investors to short-list. You can save a lot of time by doing some research on the VCs by approaching the relevant ones at least in the beginning. Your current investors should be able to build you this short-list.

4. Show your energy and passion.

5. Be yourself and try connecting with the investor also personally instead of hiding yourself behind a 60- page deck with font 12.

What are Inventure’s priorities/plans this year?

We will invest in 10 new exciting companies this year across Nordics & Baltics; therefore you will be seeing us a lot visiting physically and virtually in all major cities in the area. We have also some exciting news upcoming later this year when we announce the next phase of Inventure. 

It is common knowledge that startups’ failure rate is very high (over 70% according to some studies). Top 3 reasons cited: no market need, run out of cash and not the right team.

What is your take on this? How do you think VC’s/investors should be involved in a start-up’s journey to improve the success rate of startups? 

Often there is a correlation between these reasons like “no market need” and “run out of cash”. VCs can improve this on an ecosystem-level in quite a few ways, but importantly trying to give honest and sometimes brutal feedback to founders will help them pivot early enough before the journey ends up a failure. After investing, VCs should be accountable for making sure the company progresses to the next level. In order to support our founders, we have initiated the operations team that brings ready frameworks from our other 70+ portfolio companies to ensure they do not repeat mistakes others have already been doing.