Founder Guides

Investing in the next wave of technology

Are you thinking about Tidal as your lead investor? Well, scroll down as we answer founders’ most frequently asked questions and demystify how we think about investment.

Georgie Turner

20 Apr 2023 · 5 min read

Since 2016, we’ve demonstrated an unwavering commitment to partnering with seed-phase founders and bringing their world-changing ideas to life. This dedication has led us to activate our third Seed Fund with the same passion for investing in determined, insightful founders with the tenacity to scale and grit to persevere. We look for game-changers developing innovative and disruptive products, addressing universal problems with global appeal in markets with strong tailwinds, and are backed by clear and demonstrable business models.

For those considering Tidal as their lead investor, we thought we’d proactively answer some questions you may have about how we think about investment.

What does an ideal Tidal Ventures investment look like?

Tidal Company has the following traits:

  • A founding team made up of domain experts that exhibit solid product-building fundamentals.
  • A global addressable market that’s ripe for disruption.
  • Founders that have cracked a novel way to address customers’ needs and win the market.

Whilst we obsess over differentiated products, we are in the business of building companies, not tools. At the point where we invest, the business model validation is still early, but it shows signs of lucrative economics over time. We are ready to lead your $1-3 million seed funding round and work with you and your team to create a sustainable advantage and pave the path to success.

What phase does Tidal Ventures invest in?

We specialise in seed-phase investing, often serving as a company’s first institutional investor. Typically when we invest, the founder has an early version of their product in the market, and they are exploring early customer acquisition tactics to secure paying customers. We work alongside founders to build their companies and use our lived experiences to avoid common pitfalls and solve problems. Our track record shows success in taking companies from seed to scale and beyond, and we hold reserves to double down on a vision in future rounds.

Is it too early or late to approach Tidal Ventures for investment?

We encourage founders to reach out to us regardless of where their company is on the journey—but the ideal time to start the conversation is when you decide to start your company. We’re product builders by nature and thrive on early product conversations.

How many investments will Tidal Ventures make in their Seed III fund?

Rather than spreading our investments thin, we choose to focus on a select number of new investments each year. Over the next three years, we’ll focus on 20-25 investments, making each investment significant for Tidal and the founder. This approach allows us to dedicate our resources and attention to nurturing each investment and providing comprehensive support to help our founders succeed.

What is Tidal Ventures’ macro outlook?

As we see it in our daily lives at work and home, technology continues to accelerate and evolve. It’s broad, complex, and investable across the early, growth, late, and public market stages. We’re not alone in our prediction that technology will be the leading global focus for growth at scale and will create the type of jobs that will advance people and their economies. We’re currently living in yet another technology cycle that is having an outsized impact on our world. 75% of all computing is still on-premise. Still, with the onset of AI, we’re already seeing global forward capital expenditure investment in data centre processing capacity starting to accelerate, with cloud spending predicted to be $592 billion by the end of 2023.

What is Tidal Ventures’ investment thesis?

Our investments will relate in some way to the following three broad areas that reflect our investment thesis:

  • Focal Points: We’re looking for technologies and people that can drive scalable optimisations, resulting in platforms that can dominate a sector.
  • Cognitive Cloud: Over the next decade, every app will be a data-centric app (DaaS), with leaps being made in AI/ML that will fundamentally shift how work gets done. We are excited to invest in this transformative space.
  • Inflection Aware: We go beyond themes by identifying emerging inflections that drive significant shifts in value chains within sectors. Our investments cluster around the inflections we believe will have an outsized chance of displacing existing practices, including the future of consumption (commerce, sustainability, agtech), the future of enterprise (cybersecurity, observability and insights, productivity automation), and the future of service delivery (smart logistics, API infra and dev tools, fintech, regtech).

How can Tidal Ventures help build my startup?

We might be product-obsessed, but we are here to build long-term sustainable companies that create value for founders and investors. Our team of experienced ex-founders and ex-operators offer tailored assistance with strategy, product, and resources, helping companies create sustainable advantages. Unlike traditional investors, we act as a “brains trust” for our founders, providing direct operational support. We are passionate about building companies and guiding our portfolio companies through their critical firsts. When we extend a term sheet to a founder, we effectively offer ourselves a part-time job, a testament to the depth of our conviction and belief in the company’s potential. Our expertise supports our steadfast commitment to delivering outstanding results.

What impact can Tidal have on my product strategy?

We help portfolio companies unlock their product’s potential by providing expertise in product-market fit, product-led growth, and go-to-market strategies. Our focus is on creating bold and courageous product-led businesses that are viable, marketable, and profitable. We invest our resources where we can add the most value and work closely with our founders to build momentum and create game-changing products. We aim to foster organisations with mission-critical products that customers can’t live without.

What sort of advisory network does Tidal have access to?

Tidal connects portfolio companies with a network of proven technology founders and executives who have scaled some of the world’s top tech businesses. This expert network helps portfolio companies tackle significant challenges by providing valuable expertise and guidance from a team of C-suite executives, mentors, advisors, board directors, investors, and thought leaders. Tidal also offers portfolio companies access to vetted specialists who can help their businesses thrive. This is especially useful for seed-phase founders who often do the job of an entire C-suite for the first time.

How will Tidal back me in future fundraising rounds?

Tidal has two complementary funds investing in the best companies from seed to growth. This provides stability and consistency for our portfolio companies and delivers excellent returns for our investors. In addition to doubling down on existing investments, Tidal’s follow-on fund is used to invest in larger companies it missed out on backing at an earlier stage. Approximately 60% of our fund is allocated for first-time investments, while 40% is for follow-on investments. Tidal is a long-term partner with the capacity to invest more in later rounds, meaning we can continue to support our portfolio companies as they grow.

How do I get funded by Tidal?

We are open and actively investing in our next generation of founders. Here are some tips for getting in front of our team:

  • Warm introductions are great but not essential. Find the team member you want to talk to and send us a summary of your idea.
  • Let us know what your product does (or will do) for customers, steering clear of any buzzwords and tell us why now is the best time to build this.
  • Be clear and confident. We’re interested in who you are as a founder, the strength of your product story, your ambitions and vision, the gaps, the opportunities, and why you think you’ve got an idea that can make waves.
  • Make sure you check us out, too. Accepting investment is a big deal and a multi-year commitment. We can connect you with our founders to learn first-hand what it’s like having us in your corner.

The time is now. Get in touch with us if the above resonates with you and you want to join our growing family of Tidal Companies.

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