Thoughts of a Seasoned Investor
Think Angel Investing and it is easy to think that it is restricted to a retirement hobby. One person who most certainty does not fit this bracket is Nathan Hill, Newable Private Investing Angel, seasoned investor and entrepreneur.
An introduction and brief conversation with Nathan would not lead you to think he grew up wanting to be a scientist. Having attended Oxford University studying physics, he jokingly admits that he was “terrible at science, despite enjoying the subject!”
This small hiccup led Nathan onto a more institutional career in sales for Oxford Instruments as Managing Director. It was there that he discovered his skill was in transforming technical invention into global sales, which led to a passion for innovation and entrepreneurship. “Being able to advise technology firms in a range of sectors was something that I really enjoyed, especially as I had the chance to work with international UK start-ups. That was the moment when I knew that I really wanted to be an angel investor!”
The first investment (more an entrepreneurial venture) that Nathan made was in June 1999, setting up his own Cambridge based consultancy business called Qi3 which provides expertise to start-ups in the UK on a range of subjects, from sales, to investment, commercialisation and growth. Due to the fact that Nathan has a range of other investments to manage, the project has given him the chance to put faith in others. “It would be impossible for me to be present at every meeting, make every decision and be engrossed in every detail of Qi3. Luckily, I have an excellent business partner in Robin Higgons. I have also made a conscious effort to build an inclusive team culture that aims to reward hard work and enable people to thrive in the working environment by finding roles and responsibilities that suit their particular skill set.”
Nathan’s second sector of investments are in equities, where he has taken a more passive approach by investing in Exchange Traded Funds, which have served him well in the prevailing market conditions. Markets have seen significant volatility in recent years, which has bolstered his overall investment performance. Challenges lie ahead, none more so than with the political uncertainty in the UK.
Brexit in whatever form is likely to lead to a short-term impact on markets, but you have to be prepared to look past that. A No Deal Brexit may make me think twice about committing more capital to the markets, but let us cross that bridge when we have to.
The third sector that Nathan has invested in is the collectable market, more specifically in setting up his own successful wine business with business partner Tom Harrow, authentically called Honest Grapes. This online wine club has achieved year on year growth of 50% and recently declared its maiden profit and is now on the hunt for further acquisitions..
Nathan now has over 20 direct Angel investments, most of which are in technology start-ups. Through Qi3 he is also a Limited Partner in the recently established Seraphim Space Fund, a £70m early stage VC fund through which he has so far accumulated 13 further shareholdings.
As Nathan points out however, this does not mean it is any easier to find the best investments! “I have met a number of angels whose investments have made 0% return, and others who have seen portfolio returns of up to 43%. My long-term portfolio performance is more like 20-25%. I think the early stage technology market is an excellent one to invest in but no one should be looking to invest more than 15% of their capital in this market, it is just too high risk.” Nathan has been an active investor with Newable over a number of years , both investing in businesses and recommending deals to the network. “Newable (formally known as London Business Angels) have been a brilliant source of high quality, cutting edge and market leading Start Ups. This has been the case for as long as I can remember because Newable possess such an impressive network of expertise and deep domain knowledge, through relationships with universities, incubators and government organisations. I have yet to come across an angel network as active and engaged as the Newable network. This makes a real difference as it has enabled me to co-invest with other angels on numerous occasions!”
So how does Nathan handle the inevitable difficulties of managing so many investments?
“The first, most important mind-set to have is the acceptance that you will encounter challenges. It is very easy to forget when things are going well, that you are only one event or mistake away from your recent success counting for nothing. There will also be times when you will not succeed in what you set out to achieve, look no further than my career in physics! The key is that you always remain positive and resilient at all times.”
‘’The second, as I pointed out earlier, is to ensure that you are making the most efficient use of your time, something that is achieved by putting faith into people, and choosing the right team to lead projects.”
“Finally, focus on the things that are genuinely important to you. You quickly learn that your time is more important than money, and that focusing on what you are passionate about and what will give you the most personal satisfaction is actually most important’’
So what’s next?
“Put simply, I love what I do and will continue with what I am doing for the foreseeable future. I may make one small change in the long term, spend more time socialising, less time working, after all, it is one’s time that is most valuable.”