VC Series: My Top 5 Insights from Conversations with an Investor

Peter Jeun Ho Tsang unpacks his top 5 key takeaways from the VC Series in conversation with Rohan Bansal. He unpacks:

1. No set path into fashion and retail tech venture capital – success requires building relevant experience and perspective rather than specific qualifications.
2. The power of networks and relationships, crucial for both founders and investors to opening doors for funding and partnerships.
3. Creating a winning pitch deck is essential when investors spend just three minutes reviewing it – clearly answer "why now" and "why you".
4. Despite $3 billion in equity financing in 2024, there's a surprising lack of specialized fashion tech VC funds and a $20-30 billion annual funding gap
5. Smart money versus hype – seek investors who provide strategic value beyond capital through connections to clients, experts and industry insights

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The show is recorded from Beyond Form, a fashion tech innovation platform. We build, invest, and educate fashion tech entrepreneurs and startups. We’d love to hear your feedback, so let us know if you’d like to hear a certain topic. Email us at podcast@beyondform.io. If you’re an entrepreneur or fashion tech startup looking for studio support, check out our website: beyondform.io

Chapters

• 0:00 Introduction to VC in Fashion Tech
• 1:36 Key Takeaway 1: No Set Path
• 3:44 Key Takeaway 2: Power of Networks
• 5:44 Key Takeaway 3: Creating a Winning Pitch
• 8:56 Key Takeaway 4: Few Specialized VC Funds
• 11:20 Key Takeaway 5: Smart Money vs Hype
• 13:32 Closing Remarks and Series Summary

Transcript

Speaker 1: 0:03

Hi, I'm Peter Junho Sang, founder and CEO of Beyond4. We're kicking off the first mini-series of 2025, and it's all about VC investing in the fashion and retail tech space. I'm going to be joined by Rohan Banzal for four episodes where we explore what it's like going into the VC investing world, what's hot right now in terms of deal flow, technology, startups to look at and everything in between. On today's episode, it's just me myself and I as I recap the key lessons learned from the VC series in conversation with Rohan Banzal. In this mini series, we explored the path into venture capital investing with Rohan's journey. We looked at the power of relationships. We looked at both sides of the coin from the VC's perspective and Rohan's many years of experience and what he expects as an investor when he's looking at pitch decks, when he's speaking to founders, and what he's expecting from startups overall and on the flip side, from the startup's perspective, how do you get your story told in a cohesive way and an understandable way that the investors can resonate with.

Speaker 1: 1:23

This episode is for those of you that are maybe a little bit too busy to listen to all four episodes. There's a lot to unpack here, but hopefully I've distilled enough in five key takeaways. So let's get to it. Key takeaway number one there's no set path into fashion and retail tech venture capital. For any listeners out there that want to go into the VC investing world, especially in fashion and retail tech, it is less about ticking boxes and more about building relevant experience and perspective. So, whether that's domain expertise, having worked in the fashion and retail industries, or perhaps you've done those one or two investments, maybe as an investment manager, as a principal at another firm but you understand what are some of those key indicators of an investable case.

Speaker 1: 2:19

Rohan shared his journey with us, which highlighted that himself, by living in different countries when he was growing up, experienced diverse cultures and just having a bit of an eye opener as to how things are done elsewhere around the world, be a broader understanding of markets. This in itself, in his essential skill for investors, he need to look beyond their own reality. Perhaps your investment cases aren't necessarily in your home market, but they could be global. There's no way of knowing how every market will behave in the world, and the more exposure you have to that, the stronger you're going to be at making sound investment decisions. Rohan Hadid is no single route, but it requires self-learning, networking and gaining exposure to startups and founders are all critical for shaping that VC career. Startup experience is also more often valuable than a formal MBA. So if you are potentially a fashion tech founder that has exited their company or potentially you've worked at another startup previously, that can give you enough skills to go in the investing world and sit on the other side of the table and essentially giving you hands-on experiences and, most importantly, that emotional resilience in somewhat an industry that can be very cliquey.

Speaker 1: 3:44

Key takeaway number two the power of networks and relationships. So success in VC whether you are fundraising yourself as a startup founder or trying to build your first fund as an emerging fund manager, having a strong network is key. You can do this by attending industry events and, as we're recording this specific episode, you know Rohan will be actually on stage at the Change Now conference in Paris listening to some startup pitches and giving some sound advice. A great way there to meet the Beyond Form team, for example, reading reports, so reports like the Business of Fashion, state of Fashion Poet every year and many initial reports that can give you those facts and data that can help you to be presented in an IC meeting or an investment committee for short.

Speaker 1: 4:37

Connecting with founders and co-investors is crucial Within the VC world. It is about signaling. It is about what are other people saying? Is this a good deal? Is a hot deal that people need to get their hands on? Essentially, giving you the skills to assess the best deals and understanding the market trends. However, I must say Rohan is very good at talking and networking is something that comes naturally to him. Networking is a skill that does improve with practice and over time, so even for introverts, they can fake it till they make you know that good old saying. However, it's really important that you hone that skill. Moving forward, investors and founders relationships can open doors, regardless of which side you're sitting on the table. It can open up funding, partnerships and strategic advice that can make your capital that you do raise go much further. And what I've seen from my founders the ones that do the best are the ones that are incredibly good at getting themselves out there.

Speaker 1: 5:44

Key takeaway number three probably the episode that is very relevant to a lot of people If you're a startup founder, if you're working within a startup or you're somebody that's thinking of entering the entrepreneurship world, a winning pitch deck is key to success. So Rohan and I explored this in one specific episode. What makes a winning pitch deck? We heard in that episode, with investors spending just over three minutes on a pitch deck, according to the platform DocSend. It's not a very long time to get your story across. We at Beyond Form see so many pitch decks every year.

Speaker 1: 6:24

I personally do not review all of the pitch decks, I have to say. It's other members of the Beyond Form team and you need to be able to get your story across with clarity and with a story that makes sense, so that the rest of the team is excited to tell me okay, peter, this is happening in the fashion world and the technology world. If that doesn't happen, my team doesn't actually tell me about your startup. So that's really important. A strong deck answers why now and why you Two most important questions that I always ask every founder that I meet, no matter where they are on in their maturity stage of their startup. Without the answers to those two questions is very difficult for an investor or a potential client or a partner to really connect with you as a founder, as a startup. It's about connecting a founder's experience to the problem being solved and demonstrating that you really understand the market, that you know the trends in the market, the market sizing and so forth. In Rohan's opinion, when it comes to market sizing, for example, preferably using a bottom-up approach, listen to the full episode to understand how he breaks that down.

Speaker 1: 7:41

And, as with anything within the entrepreneurial world and the venture world, it's a risky business and we're constantly looking out for red flags. This can include co-founders with identical backgrounds. So, for example, I quite often see a full, entire team made of tech backgrounds. I see a full team of salespeople without the tech background. Those are red flags because it means you have a skills gap within your team and I want to understand how are you going to make your startup even stronger by plugging in those gaps. Other red flags include unrealistic growth projections. You know you're projecting numbers that just don't make sense in terms of how are you going to reach that goal with the amount of money that you're asking for. Those all need to line up.

Speaker 1: 8:29

Disorganized decks in terms of structure often reflect disorganized thinking within the founder and I have seen so many decks that are super disorganized. It is very difficult to understand follow that deck and, being a creative myself, the design and visual and the polish of the deck does matter, but obviously substance trumps everything else. So, essentially, traction, your vision and your credibility is what really counts. Key takeaway number four big, big topic that we discussed why are there so few passionate retail tech vc funds out there, beyond form now, has existed for a number of years. We've seen a plethora of startups and founders from around the world at all different stages, from pre-seed right through to series b, cbc. We know that it's happening and despite nearly three billion us dollars in equity financing going into the space in 2024 with clear evidence of sexual exit, there remains surprising lack of specialized vc in this sector. So the main reasons that we highlighted in this episode was that there is a shortage of investors with true fashion industry experience. There's a challenge with building the right networks for deal flow and exits, so this is also an opportunity for anyone wanting to enter the space, and historically there has been a lack of major exits.

Speaker 1: 10:06

This is beginning to change, though, in recent years. What's alarming to me that there is a significant funding gap, estimated to be between 20 to 30 billion us dollars annually. It's persisting and closing. It will require more people to enter the space, collaborating in the space between investors, corporate investors, corporations, fashion brands, government subsidies, government regulations, accelerators and public funding. All of these stakeholders need to come together to make it work and for genuine vcs out there looking to enter this space really think about plugging in a skills gap with in-house expertise of people that come from the industry, people that can advise them on what's happening in the space right now to be able to evaluate the best opportunities. And essentially, what this tells us is that it's under learning, the need for more sector focused funds and deeper industry engagement. So I guess this is my rally call to anybody that's listening that's wanted to enter into the space let's collaborate. It's required, it's what's needed in the true spirit of the fashion industry, where collaboration is key to success. Let's play that same thing in the methodology to venture capital as well.

Speaker 1: 11:20

Key takeaway number five my last and final key takeaway of this series smart money versus hype, the vc value, and when I'm speaking to founders that want to fundraise or potentially fundraise from institutional investors or outside money or business angels, whatever it may be I'm always urging them to think about taking money beyond the capital itself, but having somebody that is strategic with them, creating more value and making money work for them in a smarter way. The best angels, the best investors, are people that can connect you with potential clients, pilot programs, industry experts and supporting you on that team building phase. Money is instrumental to your quicker growth and your trajectory, but what's going to give you more value are those things that money cannot buy. However, founders should be very wary of virtue signaling and seek investors who genuinely provide strategic value. So maybe speak to other founders that have come in contact with this specific investor previously previously, who's in their current portfolio, who they worked with, and really do your due diligence on them as well.

Speaker 1: 12:31

As much as potential investors do due diligence on their potential investments, you can also flip the table and do that on them as well. Does this investment team or this person make sense for the growth of your company? The most important thing I would say is that try to find people that are not just there for the hype cycles. So, for example, 2020-21, we saw a hype cycle happening within digital fashion. This obviously worked in the short term, but in the long term, not so much. So find people that will go with you for the long haul, that long-term vision, those that long-term vision, those long-term trends and those long-term market shifts.

Speaker 1: 13:09

Thinking about building sustainable business model are not what's just hot right now. We know that sector specialists in general not all the time, but in general often outperform generalists, and a disciplined, long-term approach to investment on both sides of the table is what's going to make this space an even more credible sector to look out in the long term. So there you have it. That's a wrap from the VC series highlighting four episodes with Rohan Banzal where we tapped into the world of venture capital and investing. I hope you enjoyed the series. You'd have some key takeaways that I talked about in this episode. If you're building a startup, remember your story. Your network and your ability to execute matter as much as your product. For inspiring investors, curiosity, adaptability and relationship building are your best tools. If we can combine all of those together, we're going to make an amazing fashion tech sector for many years to come.