Latest assignments

Latest news

  • Bailey Fisher assists Grass Roots with CFO appointment
  • Bailey Fisher assists Faradion with CEO appointment more
  • Bailey Fisher assists Eagle with VP Global Sales appointment more


We are grateful to Michael Niskin for the article below, which first appeared on his Cambridge Entrepreneur blog, 18 May 2012.

Recently, Lautaro Vargas of Cabume wrote an article about the 'Battle of the Silicons' in the context of competing for talent with which to fill young start-up tech businesses.

It is in that vein, and directly following a great Bailey Fisher 'CEO Panel Discussion' held Thursday night for Cambridge tech CEOs, that I've been unable to resist the urge to pen a piece broadly comparing the Silicons for Round II. Not that this is the only insight that the panel event brings to the fold - the discussion was practically engaging and widely useful.

The panel was made up of Chris Winter, of Brightstar - New Venture Partners (VC), Andrew Davison, of Scottish Equity Partners (VC), and John Cronin, serial Chairman and CEO. I was surrounded, being the only journalist in the room, by 40-50 or so co-founders, directors and CEOs of a diverse range of technology companies from Cambridge, London and Milton Keynes (at least, of the ones that I spoke with). Our location was a tightly-knit space in St John's Innovation Centre.

We kicked off, chaired by Mills & Reeve's Zickie Lim, on our topic ('Technology, team, investment'). Some broad issues were raised. What is the UK technology sector? Andrew pointed out that our economy is c. 75% service-based, and Chris that we are lagging behind in STEM teaching. Unfortunately the word SME was (innocently) used once. Further defining terms, is it helpful to use the word 'technology', asked Chris. "People buy solutions not tech." He rightly points out that people use existing tech to provide new (non-tech) solutions, as well as develop cutting-edge products. Overall, technology is just a means to a solution. The room voted - and 'team' was seen as even more important than the solution, much to John's encouragement!

Plenty of specific, practical issues were then discussed within the brief of 'team' and 'investment'. Now, it does have to be said that the background of the panel was heavy on the VC and angel investment perspective, although Chris is also an entrepreneur and experienced Director, and John is very experienced in business operations and management. Overall, the panel provided good balance. So whilst Andrew was honest enough to say that "good companies are not the same as good investments", he was able to offer insight into how he "hates boards dominated by VCs", how boards should "not be greater than 7" persons and how "losing a founder" to a careerist CEO is a major problem.

John had a heartening definition of the word 'team'. "The team are [include] the investors" - he exclaims "VCs are part of the team" and "the board are part of the team". He shared openly how at first he couldn't sleep at night for fear of his accountability to VC investors, until he decided to share sales details with them honestly, viewing them as team members and partners. It is certainly something to aspire to, seeing investors and your (small) board as part of an inclusive team, and following John's further advice: "engage the NEDs [non-executive directors]", who are frequently disengaged and bored. Chris added that finding a Chairman to oversee the board is a good idea, especially for the young, inexperienced (and sometimes lonely) CEO.

Chris Winter actually provided a lot of key insight. He was particularly clear on IP: "IP [intellectual property] is a minority issue in creating global businesses." This was a tad controversial, but I suspect he's right. It stems from his view that "there's always a technology" to meet the business need, and so really it's all "about execution". Chris believes many firms are "wasting your time [and money] on large amounts of IP protection."

He was especially thinking of technologies that don't immediately have a market, but may (or may not) have in the future. However, I'm not convinced that his example, "printed technology [electronics]" holds true; although it is true to say that there is an uncertain immediate market, 2-3 years down the line the markets could be huge. Overall, he says he watches for "tectonic plates" where different technologies bash into each other to form new solutions. Personally, I would have thought printed electronics is a good example. Hopefully Cambridge's Plastic Logic will pick up with its new strategy.

It was in discussing funding and teams that we entered Battle of the Silicons: Round II. Chris openly said that he looks for American CEOs or CTOs because they can blend well the technical duties of a role with management and the demands of running a business. Apparently in the UK we are better on technical than we are on business management. Jim Downing of Metail's recent comments at an event highlight this problem: the CTO role really requires business management skills and is quite different from just a leading technical role. Recruitment was highlighted as the major issue by the panel in terms of both time consumption and importance.

However, the heart of this silicon battle was fought in the funding arena: and unfortunately Silicon Valley beat Silicon Fen (us!) and Silicon Roundabout hands down. Andrew raised the point that managing founders in Europe are prepared to "sell out much earlier" and that possibly "we are trying to get comfortable" rather than having the "appetite for scale" pervasive in America and captured in Mark Zuckerberg. Interestingly, it appears that scale doesn't necessarily mean brash use of wealth in Silicon Valley. As we discussed how venture capital is a "dying asset class" in Europe, following the recent Kauffman report and given that our VC funds underperform those in the US, it became apparent not only that the VC system is "broken" in failing to fund high-growth start-ups with under £5 million turnover, but also that there is a reason why US venture capital does better in the US both as as a service to companies and an investment.

Chris Winter made reference to a survey on the backgrounds of venture capitalists in Europe versus those in America. Cambridge Entrepreneur is seeking a copy of this source, but at the time of writing it has not yet been provided. Chris claims this survey shows that 60% of European VCs have a finance background, only 15% have an operational business background and almost none are entrepreneurs themselves. Contrasted with the US, around a quarter of American VCs are entrepeneurs themselves and the overall percentage in business operations is far higher. We will confirm this source in a footnote as soon as possible.

Suffice to say, the difference in helpfulness and business expertise between American VCs and those in Europe was borne out by the experiences of at least two of the CEOs present in the room on Thursday. One was Andy Sutton, of 'Bag That', who found that European VCs sought all the reasons "why not" to invest, why his solution wouldn't sell, whereas upon approaching VCs on Wall Street they found all the reasons "why" to invest. He successfully raised a £2 million funding round, and was able to launch his website on 1st May. The panel also felt that Silicon Valley has a special funding ecosystem: Chris said that the 7-year intense growth VC model "doesn't work well outside of the west coast". There is also still greater aspiration in Silicon Valley to go public.

However, it's not all bad news for Europe. It was pointed out by a CEO in the audience that Europe is a better market for healthcare technology. In fact, Silicon Valley's excess venture capital is opening up to Europe as US investors and technology entrepreneurs begin to realise this fact. There are also other forms of capital apart from VC. We are increasingly seeing a corporate "open innovation" strategy where companies are prepared to provide R&D resources to small start-ups with high-impact tech that they take under their wing. More on this to follow in future articles.

Recently, I wrote a controversial piece on cluster networking. What this pioneering Bailey Fisher event for CEOs highlights is the importance of cluster networking amongst peers in the same sector. Here companies can pool knowledge, share ideas, exchange opinions and perhaps even develop John Cronin's wider definition of team. The panel also explicitly drew out the importance of cluster networking: it is very important for senior representatives of companies to network regularly to find "potential acquirers" and "partners". Cambridge Entrepreneur looks forward to seeing more collaborative, practical cluster networking in Cambridge and beyond. We also look forward to catching up with our entrepreneurial silicon cousins across the pond. Michael Niskin 

This article is reproduced by kind permission of Michael Niskin, Cambridge Entreprenuer blogspot.

Bailey Fisher's next CEO event will take place in the autumn. If you are a CEO in the high-growth technology sector interested in attending future events, please contact

Back to news page

Back to newsletter