Summary

In this episode of the Raising Expert podcast, host Finlay speaks with Dalia Sarwat, a venture partner at DenVC. Dalia shares her journey from working in fundraising at the American University in Cairo to her current role in venture capital. The conversation delves into the unique approach of DenVC, which combines venture capital with an accelerator program to support early-stage startups, particularly in the Pan-Arab and African regions. Dalia emphasizes the importance of market research, understanding one's unique selling proposition (USP), and the readiness of a business before seeking investment. The discussion also touches on the impact of AI on business operations and the necessity for entrepreneurs to adapt to changing market conditions.

Takeaways

• Dalia's journey from fundraising to venture capital is inspiring.
• DenVC combines venture capital with an accelerator program.
• Understanding your USP is crucial for startups.
• Market research is essential before pitching to investors.
• AI can save time and improve efficiency in business operations.
• Adaptability is key for entrepreneurs in changing markets.
• Early-stage startups have unique opportunities for growth.
• Collaboration among portfolio companies enhances success.
• Cultural differences impact market entry strategies.
• Focus on your own growth rather than just competition.

https://denvc.com/

https://www.linkedin.com/in/daliasarwat/

Hello there and welcome to the Raising Expert podcast. Today I've got Dalia Sarwat to talk to us. Dalia is our venture partner at DenVC. Hi Dalia, how are you?

All good and you?

Yes, I'm very well. Listen, I'm really pleased that you've taken the time to come and talk to us and getting really close to the action here. So I'm really interested to hear about your experience working with entrepreneurs and your take on investing. first, let's get a little bit of an understanding as to who you are. Tell us a little bit about yourself, please.

Yeah, so thank you first of all for having me today. It's Dalia Sarwot. I'm originally Egyptian, just relocated actually to Scotland almost two years ago. I was in the UK, like in England before that. And when I came to Scotland, as I told you before, it's like, don't know, has like a magical charm that I don't know. It's one of the places that I actually like and I've never regretted the decision of moving in.

I've been involved with startups for some time. My grab, my background actually comes, I used to work in fundraising, but I'm still working in fundraising, but for startups before it was at the American university in Cairo, more of, giving and, teaching people how to be philanthropic and giving back generally. It doesn't matter the amount, but just like giving back or giving people the chance to have actually what you have. And when I started working with them VC.

was because of the managing partner who's a very great friend and mentor. Walid has a great experience that actually helped us to have a very strong team where we enjoy being part of everything going on.

Okay, that's cool. And listen, what a great journey. You're more than welcome and you're a great member of the ecosystem here in Scotland. And I think it's great that there's people from different backgrounds that you know, we don't all have the same paths. And I think we can all help businesses so much better by that. listen, we'll talk about DynVC in a second, but

Thanks.

Why don't you tell us more about this role at the university and what you were doing? understand it's fundraising and maybe a slightly different, coming from a different angle. But was that in the sort of entrepreneurship space?

Yeah.

It wasn't different things. Like I graduated from the same university and I'm very proud actually alum from there. the AUC is one of the universities that change your personality. It helps you to be who you want to be. It's like more of a journey, more of an education. So when I joined the university in 2006, first of all, like I was interested to study biology. I started for a bit and then I changed the American system is actually a bit flexible than the British one. So everything counts. It goes into credit hours.

So I tried and I studied different things. And at the end, I graduated with a major, Integrative Marketing and Communication and double minor, Business and Psychology, which helped me like to understand people. So the psychology bit made me aware and I understand different things when it come to us human. And then after I graduated, I moved to London. I was volunteering with AUC. And when I went back, I started working at the alumni office and then

I was moved to the fundraising team. started fundraising like first working at something called AUC fund, which is a pooled fund that covers any deficit when it comes to the university funding priorities and needs. And then I was moved to the major gift, which was like any gift above $25,000. used, this was a great experience. I was lucky enough that I worked with

Diplomats, CEOs, high net worth individuals, corporates. So it gave me a glimpse of literally everything. I worked with petroleum companies, pharmaceutical, different, different ones. The projects actually I do, used to fundraise for was either development in Egypt or in different countries, development project like water purification stations, research and development when it comes to technology or biotechnology.

and scholarships, financial aid, so it was very diversified.

Yeah, no, no, I get it. I get it. That's really nice and seeing innovation and entrepreneurship from a slightly different angle as well. I'm going to come back to your minor choices as part of your degree and just to connect that I turned up to do a business studies degree way back, way before you were a student back last century.

Yeah.

Yeah.

Mm.

And I wanted to do some psychology as part of that, so I was going to do quite a lot of marketing without it becoming a marketing degree and I was quite driven to do some psychology. Lo and behold, the psychology courses were all full by the time I got myself round to matriculating and it was suggested that I should maybe try sociology. So I went a little bit disappointed to the sociology lectures, but so many times

Yeah.

Mm-hmm.

Really, why?

Well, because I wanted to do psychology. you know, I was young and I was and I was like a little bit disappointed. And so, however, very quickly I realized that sociology was really interesting. And even though they started off on anthropology, so looking at other cultures, and it took me a little bit of time to realize how powerful that actually was as

Yeah.

Yeah, it is, it is.

Yeah.

a marketer or as a business person to understand our customer and be able to empathize with different customer groups. And I actually probably reference those early sociology courses in my degree, almost as much as some of the kind of core business and marketing stuff that I was doing. But I also see how, you know, if I had done the psychology, I would have loved that I've largely kind of done it on a

Yeah.

sort of amateur basis if you like. And I would argue that all marketing undergrads should probably think more about those social sciences, psychology, sociology, geography, history even, than getting stuck straight into marketing courses. But anyway, listen, that's me, I'm off on one of my high, no, it's never too late, it's never too late. And they do, and you know, I've worked on some of these courses, know, like consumer behavior courses, all of a sudden it's like, wait a minute, this is not real about marketing.

Yeah.

It's never too late.

Yeah, it's very important, true. Yeah.

Yeah. Okay, so listen, we'll move, I'll let you move on from your, your student days in a second. But, but why did you, why did you go for the American university? I mean, I'm sure you had lots of, lots of other options was, did you have a, what was the rationale behind that?

Yeah.

As I told you like AUC actually shapes your personality. So before going to the university, I was more of an introvert. Yeah, imagine. I was more of an introvert. like, I used to work like when since I was 13, 14 years old in family business and going to like internships and different things, but still I wasn't the same person who I am now. So when I went to AUC, it helped me like to

to be who I wanted. Like, you know, when someone asks you the questions, where do want to be in five or 10 years? Really, they hate me to reach even better where I wanted to go. So I'm very happy I took the decision and I joined. And it was one of the best things I did in my life. Yeah.

Yeah, that's brilliant and good for them. I really like that ethos about, you know, the broad learning support, you know, a life journey. That's so important. We don't realise that when we're like 17, 18, do we? You don't think it's just about what happens in the classroom.

Yeah.

Yeah, exactly. Cause yeah. And the good thing like, and especially in the American system that anything you study actually counts either in your electives or in your credit hours. I studied most all the subjects actually I liked. And whenever I feel I'm stuck, so I can't take it as a major, it can be counted as a minor. So it was a very flexible system that suited the way I want.

That's brilliant. Yeah, good, good. And those early years, know, so that education. But then when you went into the fundraising job, it was an amazing way to develop those soft skills, you know, working with those people who were donating and the corporates. mean, what an amazing collection of corporates that you were exposed to at such an early, early stage in your career.

Yeah.

Yeah.

It is like loads, loads, loads of corporate. So I worked with Apache shell BP, like big, big names worldwide. And to be honest with you, I learned a lot of things and that at the university as well. It's, we do have loads of things. I still like, even though I'm not a part of them now in the development or the admin thing, but still I say we cause I, it's more of home to be very honest with you.

Yeah, I mean, I think that's really powerful that you still do that. And it shows how connected you are with the institution or the brand and the projects. it's almost a test, isn't it, if you say we further down the line.

No.

Yeah.

Yeah.

That's because it's my degree like anything good happens to it. It's in my degree anything bad It's my degree as well Yeah

Yeah, no, totally, totally. You're right. OK, let's talk about DenVC. so we've kind of touched on it briefly in your introduction. Tell us a little bit more about DenVC as an organization and your role. So what are you doing on a weekly, monthly basis?

Yeah.

Yeah.

So as I told you when I, like me working in fundraising was more of an higher institution or in higher education, like serving different departments and covering all the needs. But with them, it's totally different. Then is more of something I really want to do. out of passion. The managing partner and all the team working there, they're more of a very like a small family trying to make a difference in the ecosystem.

with 10 million dollars and we are working on closing before this year as well the and then the Q4. So then it's quite different. We are not just investing in startups and just like waiting for them to grow. We are also trying to do our best and opening doors for them, giving them a different opportunity, sharing experience. So we have something called the Den Lounge and the Den Lobby. So wherever your startup is actually the stage you're in.

We're able to take you in the 90 days program depending where actually you are as a startup and the readiness of you as a startup and how we can help you. So it's a great mix. We don't just onboard any startup. We look for good ones where they're very hard performing and great potential in them as well.

That's brilliant. So you get a real partner coming on board with you, almost a team member by the sounds of it, or multiple team members, as you say, if you're kind of got varied backgrounds and experiences. And you've got a Delaware HQ, so a US business. But what about the geography that you're looking at for the businesses you invest in?

Yeah, exactly. Yeah. Yeah.

Exactly.

Yeah.

So it's more of the Pan-Arab region and Africa regions as well. Because the thing is, and as I told you, I'm originally Egyptian and we do have great startups over there. But the thing is, I do believe in my personal opinion, they didn't get a proper chance. So there is great companies and great entrepreneurs who actually don't have all the facilities that we have here in the UK or in the US. So we are trying to give them a chance just to go and explore. And the thing is they go like,

they rapidly grow. We do have one of the companies, I believe when we met I told you about it's called Prutinia, they are growing rapidly and expanding in different countries. are now more in like five countries and they are exploding different options as well.

No, that's brilliant. It must be so exciting. And I think you're right, you know, across the globe, there are certain hotspots that everyone talk about, certain ecosystems. So I think you're doing great work to maybe shine the spotlight on different economies and support them. And the nature of that is there's lots of great opportunities out with those really real hotspots, isn't there?

Yeah.

is.

Yeah, true.

And what about industries or categories? Is there anything that you're particularly keen on or avoid maybe?

Yes, to be honest, one of the things like we're looking for sector agnostic, it's a sector agnostic fund. So we focus on education, automotive, health, FinTech enabled e-commerce. And the technology part is like the deep tech, AI, the tech enabled ones, the one that has actually a future and there's a like, it's a sustainable business. It's not like a one of just solving one thing and that's it.

Okay. So anyone in those sectors or all those sectors is worth checking out. I'll make sure that I put your details in the show notes because maybe, you know, and for the rest of this conversation, you know this, but just as, you know, to underline it, mostly the audience are entrepreneurs who are raising investment now or maybe

Yeah.

tour.

thinking about it in the near future. maybe the next little section is kind of advice for them. So that's great. It's like, you know, go and have a look. Let's imagine though that you were sort of a UK business. Is it still worth engaging with you or is the kind of the geography is that? Yeah. Okay. Cool.

Yeah.

Definitely. personally, as Dalia, I want to share my experience because I did work in different countries and when it comes to startup, I did actually mentor. I'm also part of the Help to Grow scheme here in the UK government. And the thing is, knowing the requirements here and the requirements in the Middle East and the GCC area, it helped me a lot because by the way, what's the priority here is not a priority there and vice versa. So that's one of the things. I remember when I attended with you the

the angel investment, the pitch day. It was good, but the thing is for any business in the UK, if they're exploring going into the GCC or the Middle East, there are some tweaks that should take place. So that's one of the things that I usually see here. And they are a bit of a, it comes to a surprise for them when they don't see why people are not actually happy with the product, why they're not amazed as people in the UK cause priorities differ.

And that's one of the things that anyone is willing to expand. should be also open to tweaking the requirements, making sure they are serving the need. Then that's one of the things I usually advise any startup. Go for the need, not for the one.

No, wise words and thanks for that sort of positive open door attitude to say, listen, get people get in touch and I'll make sure that people connect, can connect with you directly on LinkedIn as well. They can see your background and based in the UK, but to have those insights is so valuable.

any kind.

So anything you can share with people and I guess that's what this conversation is about here that we could get some of your thinking out there to an audience. Because most of the businesses I talk to genuinely do have a desire to internationalise at some point. There's usually an aspiration to scale. There's probably easier markets to go into first.

Definitely.

you as you've done you know the US market is really simple. Yeah? Okay.

I'm cost efficient by the way. So that's one of the things if you see like I was phoning my bank and then I found an Egyptian lady like I know it from the accent. So when I was talking to her, I told her where are you? She told me in Egypt. And then when I was thinking, cause maybe the cost of labor in different countries is quite reasonable, not like for example, the UK. So everyone now should actually explore operating for example, in one place and serving another, depending on how to be cost efficient and sustainable as well.

Yeah, no, no, totally. I'm with you on that. But your previous points comes back to my experience of anthropology as you know, I understood it as a very young student, but those really quite nuanced differences in cultures, isn't it? So we can, you know, charge on with our UK focused or Scottish focused even understanding of the consumer, but it just has to be subtly different.

Yeah.

Yeah. Yeah.

that actually, you you're not going to hit the mark if you go into these different markets. So, okay, let's get kind of turn the table a little bit. And, you know, this entrepreneur audience that I talk about, maybe, you know, they tick the right boxes. You've seen the initial pitch deck or whatever the engagement has been. Can you tell us a little bit about what you and your colleagues are looking

for in the companies and maybe the founding team. don't know if you have any thoughts on that.

Yeah.

So first of all, like after the due diligence and all like the bits and pieces, we make sure that everything is right. We look for a company where actually the founders and the team over there, they work like hand in hand, just it's not the sake, it's not an idea, you it's not a bubble. It's something sustainable where it's worth investing, worth actually having them on our portfolio. So that's one of the things. I'm very proud with everyone we have, and we are still going to onboard more depending on our strategy.

so that's one of the things. And I remember once we were having, in a gathering, a meeting. So all the companies and all companies on the portfolio, what they do, we compliment each other. So we keep on thinking and brainstorming together. It's more of a teamwork, people working under a big name. And then as well, like we all open doors for each other. And that's one of the things we do, like how they are going to collaborate. What's like their expansion plan, where they want to go where, where does it, they see themselves in the future.

how actually they are open to change and adjusting as well. Cause that's very important. If you see like big companies, so for example, Kodak, when they didn't jump on the train and like work on their company, like they are not even there. Nokia, Blackberry, different things. So when you don't have the capacity of changing and accepting the change around, you're not going anywhere.

But great points and those are classic case studies now that we look at. But I think you're totally right that those attributes, characteristics have to be in place right at the very start. You know, that collaborative mindset or adaptability. Because if they're not there in the original founding team, you know, what's the chance of them then being in place when we're much bigger and it's much harder?

Yeah.

to change direction, isn't it? So yeah, no, are really valuable. maybe, I'm not sure if you laid this out in your intro about Den. So more than an idea, totally with you. So they've maybe shown some traction or so on. How would you describe that in the sort of product development stage or, you know, we often hear people talking about

Indeed.

Yeah.

annual recurring revenue. Have you got a sort threshold for that as well?

We do, as I told you, like we actually focus on early stage companies that like follow the pillars that we want to, like it's more or less when they are in the pre-seed or seed, like very early stage. Cause it's always good when you try to, to develop something at the very early stage, it's easier. And we tend to like, when we share our actually experience and different backgrounds, they learn and they.

Okay, so pretty early,

they actually succeed more than we expect.

Yeah, no, no, that's, that's cool. Cause we hear it's such a broad definition early stage for some people at early stages, a million pounds or a million dollar turnover and more. but then early stage for some real startups are like, well, you know, I've not actually sent out the first invoice yet. So that's good to know that you've, you've got an appetite to, be engaging with people at a pretty early stage. this, this is maybe

Yeah. Yeah.

Mm-hmm.

quite broad and this is the positioning of this podcast if you like. What advice would you a founder just sitting out on the fundraising journey? Are there maybe two or three things that you've seen that people have done very well or people maybe often miss out from your viewpoint?

Yes.

So two things actually that I see very important and whatever country I did work in, see like entrepreneurs actually falling into this trap. So first of all, you are not the first one to do anything. Just do your market study very well. And I know this like stop saying we are the first people who does such and such because know that that's not true. You have to do your market research and to know what what's your USP first.

That's that's one thing the other thing is well, you have to know your readiness. So how ready you are actually to go into the market? That's one of the things that people don't realize the readiness of their business before pitching and exploring Like and what are you giving as well? Like is it more of an equity? Do you need guidance? Do you need so what are the funds for a lot of people when they come on fundraise? They just want like a fancy office or they want I don't know to go here and there. That's not the thing

focus on what do you want the money for? Is it like for your business? Is it to buy a product? What is it exactly for? Not fundraising for the sake of just fundraising. That's one of the things that I see most common in all the countries I've worked in.

that's interesting and listening to people like me and people that do my job and I guess from your side of the fence there's a little bit you know we try and give that advice but they are fairly consistent mistakes if you like that we do see that so yeah I'll try and reinforce that and hopefully people listening will say right yeah I don't know

Mm.

I wish, I wish, because usually what they do is, you know what, they go in the crowd, just know your, like your strength and try to look for other opportunities. Don't just keep on digging and trying to do the same exact thing. Just go for a very unique thing, know your USP and then go for it.

Yeah, no, good advice. And I think your comment about competition is so true. And, you know, I've heard a lot of people say that the fact is there's not many sort of broad services of product that aren't being satisfied right now. What people make the mistake is that the job to be done, if you like, is probably getting done.

just now by some other thing. So that's the first point. And the second point is, yeah, how comprehensive is your market research to say nobody else in the whole world? Because, this conversation has been really quite global. You know, maybe, you know, that in Dundee or Scotland or the UK and London, you can see there's nobody doing it. But listen, you can get blindsided really quickly from

heart. Yeah.

Yeah.

someone especially in digital products because people just appear from nowhere. And I think there's yeah it's often just a form of words to say isn't it you know this is what we're doing we think this is unique but yeah.

That's the thing. That's the thing. Like I would advise anyone to like put away competing with others and what everyone's doing and how we're doing better than them. But what actually are doing better than you were last year. That's one of the things compared to yourself, not to anyone. Like it's good to know your market, the market, and it's good to know your competitors, but don't always like be narrow minded, just like trying to compete with everyone and ignoring what you're, what you're focusing on.

Yeah, no, no, that's cool. We'll reinforce that. think, you know, I'll chop this down and get some sound bites. And I think in that little session, we've got them there. You know, you've given us some little nuggets to work with. know, in our domain, sort of advisory entrepreneurship, for a while it was virtual reality, but now we can't, we can't.

Hahaha.

Yeah.

look or read anything without hearing about artificial intelligence. And, you know, connecting that with our last point, you know, you could say this is completely new. So if you're working in that domain, it's completely new. It's not because we've had other tools and, since the start of the printing press or whatever, you how we gather information and how we process it and so on through the computer age. But this is a question I've been put in

to people just to add to the debate a little bit. How do you think AI is going to impact what you do? And how do you think it's going to change what we do in this space over the next couple of years? mean, as things are changing so quickly that two years are going to be really quite significant. What are your thoughts?

very, yeah.

So like for AI as any other thing, anything new, by the way, we human have resistance to it. So that's one of the things like now as my mom came over, so we went for some shopping. She's used to like going into the, like the shopping stores and seeing different things with all the stores now closing down and moving to an online platform. It doesn't give you an option of exploring and having like the look and feel of different things, but it's how good you can actually adjust to this. So.

The drawback is you don't see the physical things. And the good thing is like you save time, you save money, like parking and going here and there. So it's how you want to utilize and use the thing. So AI can help us like now, if you want to like write an email, you can just go on chat, JPT or any tool and just like write a few lines and they can draft something where they can then proofread. But before that, you can take like a couple of an hour or so, depending on how important it is.

And then it can take you some time just to write a document. So it's, I think it's like time saving, energy saving, cost saving as well. Cause you don't need to have, for example, an expert just to write something for you, someone working in PR or marketing, you can just like work it off online. So it all depends how you can use it in your own favor. And that's the adaptability. I was telling you about how people can adapt to change in their own favor.

Yeah, no, no, totally. I'm with you on all that. And yeah, we've not really solved the problem of the bricks and mortar retail, have we? You know, it's interesting that not everything is going to completely move to digital. It's not a hundred percent solution. You're right. We still like analog. We still like some of those experiences and the human engagement of the retail environment. But so many things we've spoken about.

Yeah. Yeah.

have come back to a mindset. I think as an investor, as an employer, I think that closed mindset to say AI is not going to affect my sector, or I don't need it, or we don't need it. I think you're right.

It will.

It will, but you have to think how to make it, how to, how it will affect in a positive way. Cause it's here and it's good just to come on board and try to make it in your own favor.

Yeah, and I think that's certainly what I've come round to in my own thinking. And as you see things develop, you realise what an amazing tool or tools they are or what's available to you if you can find the way to work in a positive way with those tools. But yeah, there's always going to be some people who are resistant. I understand that.

Yeah.

They will come later on.

Yeah, I think it's, you know, you're trying to trying to stop something that's pretty, pretty huge. I think you're right. If you resist it, they probably will have to have to come. Listen, we'll we'll put that into this, the wider debate about AI and the pros and cons. But listen, I've really enjoyed our conversation. And as I say, I'll signpost listeners to some of those different resources and so on that.

cool.

Thank you so much.

that you've mentioned and keep up the good work. Thank you very much.

Thanks. Thank you so much, Wendy. It was pleasure being with you today. Thank you.

Thanks. Thanks.