With 2001 still fresh in the mind, “Europe” and “internet” are two words you don't often see used in close proximity to venture capital these days. So to hear about a UK-based dot com being relaunched by two veteran online venture capitalists is something of a surprise.
“Internet VC is recovering,” says Martin Clifford, the new CEO of business networking website SoFlow.com. “But now people are applying old business principles to the net, and you've got to prove your position more. I'm not sure what it'd be like if I didn't have a couple of successful ventures under my belt.”
SoFlow, which is selling itself as the “intelligent online business network”, constructs networks of contacts to allow paying users to connect with potential investors, find jobs and employees, and use their network as a sounding board for new ideas. Having been beta launched in July, the company has now been invested in by Clifford and Mel Morris, the new non-executive chairman, who will see it through to second round funding early next year. The duo bolstered already solid reputations as net venture moguls last year when they sold their previous venture, the dating service udate.com, to InterActive Corp for $150 million.
The online networking industry is already getting crowded in the US, with sites like LinkedIn and Friendster attracting upwards of $13 million in venture capital, but it's a relatively undeveloped sector in the UK. Moreover, Clifford claims to have been unimpressed by the business models of the competition, describing them as “product- rather than marketcentric”.
“It's more about timing your finish than your entrance,” he explains. “I'd rather stay behind the leaders. That way, you can learn from their mistakes.”