I made a small investment in DeadHappy in 2020 via a convertible loan. I personally invest in this new round over 5x as much as in the first round. DeadHappy digitizes the life insurance market and offers a much more flexible product that can be adjusted annually. The product is individualized via its own "death wish" platform, so that the customer builds an emotional relationship with the insurance, as this is very individual. For example, you can insure your own funeral expenses as a themed funeral (pirate funeral or Viking funeral). It is also possible to insure the costs of maintaining your own pet. This function can be easily tested on the company website.
New insurance deals have recently been closed, which will allow DeadHappy to achieve higher sales for each insurance company in the future. Another important milestone will be the connection of DeadHappy to price comparison portals. DeadHappy's marketing is characterized by black, British humor and, in my opinion, excellently done to shed light on the taboo topic of "death". The white labeling of the product is also planned, so that within the framework of partnerships, for example digital banks such as Monzo, Revolut or N26 could sell the product under their own name. Expansion into other markets is planned in the long term. In my view, the traditional insurers are too big and sluggish to quickly come out with a modern product. This is exactly DeadHappy's chance to establish itself in this market. The market potential for an increase in value by more than a factor of 10 is definitely given.
The valuation will be approximately GBP 41MM post-money, including the approximately GBP 6MM raised in this investment round. A total of five (!) institutional investors/ VCs are on board: Octopus, Headliners, 4Ventures, Verso, and Evolution. Verso joins this round for the first time. Octopus, Headliners and Volution are existing investors from the previous round investing again. The main investor of this round is Octopus who will invest at least GBP 2.6MM. Total VC investments are GBP 5.0MM and current round size total is 5.8MM. So crowd investors and angels invest a total of around GBP 800k. One of the advantages is the large VC portion of this round. From my point of view, you can "hang on" here and benefit from the expertise of the VCs if you join the round. The company has thoroughly examined a VC that invests over GBP 2MM and found it to be a good investment. In the past financial year up to June 2021, DeadHappy made approx. 2.0MM sales and plans to achieve 5.1MM sales in the current financial year. From my point of view, DeadHappy has built a strong founding team at the top and a positive company culture. Employee reviews on Glassdoor are good, as is the TrustPilot rating of 4.9 (out of a maximum of 5.0) from customers.
I see a small risk that the sales target of 5.1MM for the current financial year could be missed in the short term. However, this should not change the long-term positive prospects for DeadHappy overall.
I have been invested here since 2016. Hectare always manages to close a new round of funding at a higher rating - and each time the rating looks almost outrageously high. The current round is no exception.
Hectare is a technology company that digitizes analog processes in agriculture. For example, the purchase/sale of farm animals such as cows or sheep can be transacted using hectares, as can the sale of goods such as grain and corn. Hectare's range of services is constantly being expanded and also includes the organization of animal transport, insurance and secure online payment for farmers. So far, Hectare has mainly been active in the UK and the monetization of the offers is not yet fully developed. So far, relatively small sales have been achieved. Recently, Hectare is increasingly becoming a provider of technology solutions in agriculture to other providers and partners.
The post-money valuation will be approximately GBP 50MM including the GBP 15MM raised in this round. The main investor, who will invest around GBP 10-13MM in this round, is a private individual who, according to founder Jamie, has been investing for a number of years and is in close contact with Hectare. This investor buys approx. 20-26% of the shares in Hectare in the current round alone. In December 2021, a notice was published on Companies House that Richard John Koch is a new "Significant Voting Person" and holds between 25% and 50% of the Company's shares. So it stands to reason that this is the main investor in the current round. Richard John Koch is a British business consultant, venture capitalist, author and founder of LEK Consulting. LEK Consulting employs over 1000 people. According to internet sources, Richard Koch's fortune is >100MM EUR. Here, too, the strong lead investor is an important decision-making basis for me.
In this round, shares will be issued with a simple liquidation preference: in the event of a sale of the company at a valuation below GBP 50MM, investors in the current round will have their investment returned first, before shareholders in previous rounds will be serviced. So if the company is sold for at least GBP 15MM, investors in this round will get their full capital back. This could change later if another round of funding with preferential shares is raised. In this case, however, the 15MM of this round should have been used to significantly increase the value of the company, so that the newly emerging preference would not be a problem.
As already mentioned, the valuation of GBP 50MM seems sporty high again. However, the preference shares offer good protection, so that the risk/reward ratio is adequate from my point of view.
Technical note: If the "Invest" button does not appear for Hectare, your investor profile would have to be updated (Profile Settings) by selecting "Sophisticated Investor" or "High Net Worth Investor" as the investor category - if this fits your personal circumstances .
Disclosure of conflicts of interest: I have invested in some of the startups mentioned at an earlier time and/or at a lower valuation or better terms.
Risk warning : This is my personal sample portfolio 2022. The content is for general information only and does not provide any guarantees. This is not investment advice nor a recommendation to buy or sell any particular startup. This is not intended to be a promotion of any individual investment opportunity and is not an offer to the public. You decide for yourself how you proceed. Investments in startups are high-risk investments and regularly lead to total loss of capital invested. This is an illiquid investment class. It is often not possible to recover the capital invested before the company is sold or at all. Please also note the disclaimer.