Startup Notes

Alexander Frolov on increasing your chances of getting funded by a VC like Target Global

November 29, 2017

Alexander „Alex“ Frolov is a truly pan-European entrepreneur and venture capital investor. Originally from Russia, he has spent the last five years building up the international VC firm Target Global, which is a comprehensive family of funds and offers investments and support to companies of all stages (from seed to growth). With offices in Berlin, Tel Aviv and Moscow, the company covers the European startup market in great depth - but also bridges the local and US startup scene by having an additional office in San Francisco. Target Global focuses primarily on fast-growing digital-enabled B2C and B2B companies in marketplaces, FinTech, software and mobile segments. The VC firm aims to identify and support great teams that execute on phenomenal opportunities to create true success stories. Since 2012, Target Global has invested into more than 40 startups and currently has more than $500 million in assets under management. Well-known companies like Delivery Hero, Blue Apron, Book A TIGER and Auto1 belong to Target Global’s portfolio.

As a General Partner, Alex works on all aspects of the VC business and tries to create sustainable returns on investment and support startup success cases alike. Prior to joining Target Global, he worked at the VC firm DFJ Esprit in London and led several private and corporate tech startups himself. Alex started his career as an analyst at Troika Dialog Asset Management, where he covered the telecom and IT sectors.

In this episode, we are talking to Alex about what makes Target Global unique as a VC, the questions that he asks startups when they seek funding, how entrepreneurs can impress him during an investment pitch, what current industry trends he sees in the European startup scene and what people might not know about the tech scene in Russia.

Here is the full list of topics that we cover with international venture capital investor Alexander Frolov:

[01:25 – 02:19] Introduction of Alex and his professional background

[02:20 – 04:14] On the founding story behind Target Global

[04:15 – 05:04] The one thing that people don’t know about Alex

[05:05 – 06:49] What Alex fundamentally disagrees on with other people

[06:50 – 08:52] On Target Global’s ‚unfair advantage‘ as a VC

[08:53 - 10:08] On the definition of the term „hustler“

[10:09 - 12:07] How Target Global assesses if a founder has what it takes to be successful

[12:08 - 12:52] On Delivery Hero being Target’s most successful exit to date

[12:53 - 15:14] The ‚secret sauce‘ for Delivery Hero’s success

[15:15 - 18:01] How the founders of their portfolio companies convinced the Target team to invest

[18:02 - 22:38] On the investment into Hello Fresh’s US rival Blue Apron

[22:39 - 23:38] Alex’ view on Amazon being a threat to e-commerce startups

[23:39 - 27:33] Target’s screening process for identifying opportunities and making investments

[27:34 - 29:14] How long it takes on average from an introduction to transferring the money for an investment

[29:15 - 30:46] On the KPIs that Target Global uses to measure its own performance

[30:47 - 31:12] One question that founders teams should be prepared for to answer during a pitch

[31:13 - 34:23] Target’s operational involvement in their portfolio companies

[34:24 - 36:54] How entrepreneurs can ‚wow‘ Alex during an investment pitch

[36:55 - 38:39] Alex’ worst investment decision as a VC

[38:40 - 39:44] The best advice that was given to Alex as a VC

[39:45 - 41:54] The promising industries that Alex himself would found a startup in

[41:55 - 44:30] What people don’t know about the Russian startup scene

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