Making a marketplace
In 2016 Vevolution was a leader in plant-based advocacy events. Now in 2022, the organisation has pivoted to making their own marketplace, a fintech platform which centralises funding and helps investors and founders find one another. To talk about the change and Vevolution’s mission is Erik Amundson, co-founder and managing director of the startup. Erik shares a bit about his own personal story and how he came to join the Vevolution team, as well as the behind-the-scenes process of bringing such a shift in the organisation to life. We dove deeper into how the platform works, what impact means to Erik, Vevolution’s business model and their own recent seed raising event plus more.
Erik’s story begins in 2016, when he graduated university after studying sustainability and business and began working in municipal sustainability. In that time he worked for one of the largest environmental non-profits which involved creating a virtual network with sustainability professionals from around the world, a job which gave him experience in managing communities.
Erik: “I love that. I love allocating these professionals to funding, working with people all over the world and helping them grow with whatever they’re working on.”
However, just as he was attending sustainability conferences where leaders would gather to talk about what they can do become better stewards for the environment, they were simultaneously eating meat and serving burgers.
Erik: “I had been plant-based for a while so I left that nonprofit, started working in the for-profit sector and that’s where I started working on my own side project with plant-based entrepreneurs.”
This side project became the Mile High Vegan Network, a community of resources for plant-based entrepreneurs in the local Colorado area. It was through this network that Erik then met the Vevolution team who had just pivoted from their previous business model, and joined in early 2021.
Story of Vevolution
The story of Vevolution took off in 2016 when the company launched as an events organisation, gathering people from all over the world to meet potential co-founders and investors.
Erik: “Our original co-founders, Damien and Judy, they always had this idea of having some kind of investment platform. Capital was always a huge hurdle for a lot of startups. If you don’t have connections in the industry, if you don’t have really prominent advisory board, it was something that always came up as a challenge.”
Vevolution started hosting pitching events and awarding capital with investment partnerships at Vevolution events.
Erik: “It was always a big part of where we wanted to go.”
At that point the team were also introduced to Michiel van Deursen, a tech investor, founder of Capital V, and early investor in a number of notable vegan startups such as the Vegetarian Butcher.
Erik: “His issue as an investor was that he was inundated across multiple platforms … there didn’t seem to be a central place where investment could happen and startups could have that equal opportunity.”
Then the pandemic hit.
Erik: “COVID really accelerated that opportunity. Events-based industry had collapsed overnight … so it was like let Vevolution die with what it was, or really pivot in a dramatic fashion.”
At this point the team brought on new partners such as Tristan Hartman to help with development.
Erik: “It was really difficult; to build your own product, to build your own marketplace from scratch and to own your own tech, it’s really complicated.”
The startup re-launched it’s new mission at the end of 2020.
Erik: “The startups knew who Vevolution was, so they came to Vevolution’s new platform and we had our first group of new investor members, and we’ve been going from there.”
The platform also helps connect employees with potential employers to help build an ecosystem. In other words,
Erik: “It’s a place where startups and anyone can communicate.”
But how does Vevolution fit in to existing fintech and crowd-funding platforms?
Erik: “They are pretty industry agnostic, so our ability to provide a focus on the future of food and veganism, plant-based and cell ag really generates clusters of activity.”
Erik: “That focus allows us to make a bit more of an impact.”
In terms of crowdfunding:
Erik: “We’re not a crowd-funding platform. Those are super important but they provide just a different solution. We actually have a commercial partnership with Seedrs which we’re just announcing, so we want to work with them and have companies be able to find their lead investment on Vevolution.”
This emphasis on lead investment is important.
Erik: “They [startups] can’t go on crowdfunding platforms unless a significant portion of funding is secured, so to have a place where they can find that lead investment and then go to crowdfunding if they need to if they need to finish things up is why we formed that partnership.”
As with all mission-based startups, Vevolution is also really focussed on having an impact. We asked Erik what the word meant for him and how Vevolution go about measuring their success in that domain.
Erik: “For us it’s very simple. It’s how many startups are finding funding on Vevolution.
Erik: “We’ve had about 25 startups from around the world secure funding on the Vevolution platform.”
Erik: “When I get that notification that startup XYZ has secured funding, that’s what gets me up in the morning and keeps me going.”
At the moment the platform hosts ~ 3300 users, 1300 startups and ~ 100 investor subscribers.
But as a two-sided marketplace, how does one balance the focus on investors and startups?
Erik: “Having a two-sided marketplace is kind of like a rollercoaster. You’ll have some months of focusing on the supply and then you’re going to have a few months where you’ll need to go back and focus on the demand.”
Erik: “A lot of that depends on the functionality that you’re creating and how you make that easier for either side to get them to do what you need them to do more quickly.”
Erik: “When we originally launched, I don’t think we were really worried about the startups because of the community, trust and brand that Vevolution had build beforehand. The big major key challenge initially, was getting that first group of investor subscribers, I think it was 25-30.”
Erik: “Once we had that we didn’t have much concern for the deal flow or startups, but we had to make sure our functionality was really seamless for the startups.”
As of today the platform has ~ 180 live fundraising events.
A big part of the platform Erik also mentions is its equitability.
Erik: “The founders who are in developing countries or don’t have this prominent board of advisors or board of directors, they need a place to go. If they’d never done this before, how do they find investors? How do they stand out? And I think Vevolution is a great place to do that.”
The process for signing up? A startup just needs to add who they are, where they’re from, how much they’ve raised, minimum ticket size, a valuation cap and a summary of yearly revenue.
Erik: “We’re not managing those valuations … the startups and investors are able to discuss that themselves and start that due diligence on the platform.”
Due to the rising interest in alternative protein, we’ve also seen a large number of non-vegan individuals curious about lending a hand and getting on board. We asked Erik how he manages to get people who maybe don’t identify as vegan themselves but are interested in investing in new things into it.
Erik: “On the one hand there’s a new fund on the future of food launching every week … so I think this community is growing from within.”
Erik: “But we [also] have these angel investors, or even funds, who I’ve never heard of before … and they’re new to the space.”
Erik followed on with an example of investor who never invented in food or biotech previously but had the capital and really wanted to be involved in this industry. The first check that they ever wrote in this space ended up being to previous Vegan Startup Podcast guest MeliBio, all through the Vevolution platform.
So since Vevolution aren’t a fund, how does their business model differ?
Erik: “We do not take a carry or commission on any of the rounds that we close. I think we’re really proud of that.”
Erik: “It’s certainly something we considered doing, that certainly would help us grow financially much more quickly.”
Erik even went on to mention that Vevolution subscribers, family members and friends have all questioned the decision. The answer for Erik is quite simple.
Erik: “We’re trying to make a bigger impact than that and as we build up other services, other marketplaces, it’s not necessarily the right long-term model for us.”
Erik: “We don’t need to be a fund to catalyse the rounds that are on Vevolution.”
The platform does have an investor subscription of $1000 / year, which increases to $3500 / year for funds and VCs.
Vevolution also just closed their seed raising round on their own platform of $330,000. We asked Erik what the plans are for the organisation going forward. He summarised the next steps into three main categories.
Since first year of business was 0 marketing, plan number 1 is to get story out there and build brand awareness
Expanding services that aren’t fundraising focussed
Scaling operations -> bringing on talent that helps Vevolution perform better as an organisation
To end the episode, Erik also shared a piece of advice for our listeners.
Erik: “I think being an entrepreneur is really really challenging.”
Erik: “My only thing I would like to put out there to listeners is just to take care of yourselves. What are you doing to make sure you’re taking care of your wellbeing? For me I’ve been really focussing on yoga, my meditation practice and getting away.”
Erik: “For entrepreneurs, now is the best time. There’s an incredible community in the vegan startup world, so just get started.”
To learn more you can head to Vevolution’s website, or follow them on social media here.