Mark Pearson is not a typical investor. In a field where it can seem everyone has a finance background, Pearson seems to have almost stumbled into investing. Leaving school where he says, he “didn’t do very well,” Pearson began his working life as a chef in a Gordon Ramsay restaurant. This, however, indirectly set him on his way towards founding Fuel Ventures.
He started his first business, a restaurant in South London when he was 23. And it was here that he realised that his real passion was not food or hospitality, but entrepreneurship. His next move was to start MyVoucherCodes in 2006 with £300. Growing into a multi-national business, when Pearson exited, he found himself in a position where he could help support the entrepreneur ecosystem.
Fuel Ventures’s different approach
Founded by successful entrepreneurs, Fuel Ventures can offer something different to the usual investor. Most of their recent portfolio companies share their London offices, where they benefit not just from the investment, but the advice and experience of investors who have successfully scaled and exited their own startups. It is now also expanding its offer, launching a £45 million fund that will be targeted at early-stage and pre-seed startups.
The fund will make Fuel Ventures one of the leading early-stage investors in the UK. Pearson anticipates more than 60 startups will benefit, with around 80% of those being UK-based. Pearson is intensely proud of the British startup scene: “I’m proud to be British, and proud that the UK is third in the world with regards to building tech companies. That’s not bad for a small island!”
Pearson also anticipates an improvement in the representation of women and minorities as a result of the new fund. “Probably two years ago, we assessed the deals coming into our inbox, and about 6-7% were female entrepreneurs.” However, since they started focusing on early-stage startups, the numbers have improved significantly. “Already within that portfolio, we have a much bigger percentage of female founders, around 30-35%. It’s not 50% yet, but the improvements are there.”
Pearson also highlights how other aspects of the system can result in imbalance, pointing to the diversity within the Fuel Ventures team. “That helps, it means a friendly face, someone who is like-minded. Not me, a scary white man!”.
Ultimately, though, Pearson highlights the issue is getting women and people of colour is to get more of them into the system, rather than offering them preferential treatment. “We don’t look at sex, race or background,” instead they are focused on finding “the best companies that, we think, have the best potential. Ultimately, it’s a challenge for the whole industry.”
Optimism for the British tech scene
Fuel Ventures funding may be slightly higher risk, focused on the early-stage ideas that have yet to be fully tested, but that reflects Pearson’s ambition and optimism, even despite the challenges of Covid-19 and Brexit. “I am bullish about the UK. Even with Brexit — a reason to fight even harder — I think the UK is perfectly positioned internationally. So, we look for founders who want to build £1 billion-plus companies, creating global businesses over the next five to ten years.”
This is reflected in the increasing ambition Pearson can see in founders. Compared to ten years ago, he is seeing more second and third-time founders who can build on their experience and knowledge with each startup. In turn, he notes that first-time founders are also becoming more ambitious. “It’s leading to a new wave of entrepreneurs who are much more ambitious and thinking bigger,” he says. “Instead of selling off early to US players, they are thinking, ‘I can take this all the way.’”
The new fund helps to support those ambitions, identifying the ideas that, with funding and support, don’t just go on to make a return on the investment, but have the potential to change the world. However, for Pearson, the real excitement is seeing his funding transform an idea into a product, “Getting that concept live, getting the first customers, all the good that comes to the economy and the individual because you’ve gone on a career journey with them. That’s what I love.”