Breaking Barriers in Inclusive Venture Capital with Lise Birikundavyi

Breaking Barriers in Inclusive Venture Capital with Lise Birikundavyi

Kelly Kennedy : Welcome to episode 268 of the Business Development Podcast. Today we're joined by Lise Birikundavyi, trailblazing investor, change maker and co-founder of Canada's first black lead venture capital fund, BKR Capital. From Burundi to Montreal to the front lines of inclusive innovation. Lise has dedicated her career to breaking barriers, reshaping finance, and empowering diverse founders to solve the world's toughest challenges.

Stick with us. You don't wanna miss this episode.

Intro: The Great Mark Cuban once said, business happens over years and years. Value is measured in the total upside of a business relationship, not by how much you squeezed out in any one deal. And we couldn't agree more. This is the Business Development podcast based in Edmonton, Alberta, Canada, and broadcasting to the world.

You'll get expert business development advice. Tips and experiences, and you'll hear interviews with business owners, CEOs, and business development reps. You'll get actionable advice on how to grow business, brought to you by Capital Business Development Capital bbb.ca. Let's do it. Welcome to the Business Development Podcast, and now your expert host, Kelly Kennedy.

Kelly Kennedy : Hello. Welcome to episode 268 of the Business Development Podcast and today it is my absolute pleasure to bring you Lise Birikundavyi. She is a trailblazing finance specialist and the co-founder and managing partner of BKR Capital, Canada's first institutionally backed black lead venture capital fund.

With a background in hedge funds and a drive to fuse financial success with societal impact, Lise has dedicated her career to reshaping the investment landscape. Her extensive experience includes leading the Jacobs Foundation's EdTech impact investment strategy and mentoring high potential startups in emerging markets.

From funds of funds and venture capital to an interim CEO role at a tech startup, Lise's expertise spans the entire investment spectrum, making her a powerful advocate for transformative inclusive finance. A CFA charter holder with a trilingual Bachelor of Business Administration from HEC Montreal and an MBA from the Shanghai Advanced Institute of Finance.

Lise's global perspective is matched only by her commitment to lasting change, fluent in French, English, and Spanish with conversational Mandarin. She combines her multilingual skills and impact driven vision to foster innovative. Diverse and inclusive investments. Lee stands as a powerful force in finance dedicated to creating wealth that uplifts communities and champions, sustainable poverty alleviation.

Lees, it's an honor to have you on the show.

Lise Birikundavyi: Thank you so much, Kelly, for having me. It's an honor. Fun to be here.

Kelly Kennedy : It's it's incredible. You've had an incredible career and I can't wait to get into it. But first off, you are our very first venture capitalist, and it is awesome. I'm so excited for this because we have such a large listenership.

Founders, startups, tech startups, entrepreneurs, and this side of things is really challenging to navigate. And we chatted about that kind of ahead of the show where it's like, unless you're in it, it's really hard to understand. And so, you know, we've had the pleasure of having the Georgian Angel Network come on.

Who is also in your area to come on and explain, you know, what is angel investing? And that was. Awesome. But it kind of left this like wide gap at the end because they talked about how angel investing, they're really trying to build a company up to get it to a stage where a VC will step in right. But that was it.

That was kind of the end of what we got to. And so I'm really excited today to paint the other half of that picture and what that looks like. And not to mention the work you're doing with BKR is groundbreaking, and I'm very excited to chat about that. But before we do, Lise, how did you end up on this journey?

Were you always this entrepreneurial driven.

Lise Birikundavyi: That's very good question. I think probably how I ended up in this journey, I guess, yes, maybe. I've always, I've always been very entrepreneurial driven. I think that the best way of describing the way I take decisions is that I'm very purpose driven. Let's say I'm very intentional in the choices that I make.

And very early on I realized that there was a, there was a big gap between what society, was seeing in the black community through the media and what I was seeing in the black community too. Know, friends and family. So what was portrayed publicly in terms of, you know, maybe the societal issues?

That what I'm seeing on TV wasn't what I was seeing around me. I was seeing driven, intelligent people who, who worked hard. And I always wanted to understand how do, how do we bridge that gap and how could we sort of like get out of this single story and single narrative that was going on around the black community.

So that was always something that was in the back of my head. I grew up in in Montreal. I'm in Montreal, and hence the, the Francophone accent. And I, with that, I sort of, I, you know, grew up very in a very French clean environment. I decided to venture out when we have this school system in Quebec that's called CÉGEP after high school.

That's very unique to Quebec. So we did five years of high school and then two years between university and and high school. And I, I decided to go to an English CÉGEP an Anglophone CÉGEP, which, which was very, very different, you know, than what most people around me were doing. And for me, I was know, let's go to this adventure.

Let, let's give myself the tools that I need succeeded. Like, yeah. And my English was very, very poor. Very poor. So I arrived there and for some very strange reason, which with the placement test, I ended up in like the most. Men's classes in English. So I was like studying Shakespeare and I just could not understand a Singapore that people were talking about.

So had to buy the books in French and in English to make sure I could understand. But what was, what was super interesting during those two years is that obviously I started with very limited ability English, and then I ended up. Like pretty much knowing how to converse and you know, like I did well in all of my classes.

So it just taught me that it was not scary to get into an environment that was completely unfamiliar and you can sometimes learn as you go. So I did the same thing afterwards. So I went to HSC in their first TR trilingual program, which was French, English, and Spanish. Wow. And they had like a third of our classes in Spanish.

And again, you know. I think I'm also very competitive inside, so I needed to have good grades. So I, I, I wouldn't really make sure I understood what I had to understand and yeah. As part of our program, we had to spend some time in Latin America, so I spent six months in 18. Yeah. Wow.

And I could speak about economic development marketing in Spanish.

But I did not know how to say I wanna cross the street or where a tooth, Russian.

Kelly Kennedy : Yeah, yeah, yeah. Wow.

Lise Birikundavyi: So that was super interesting. But you know, again, being immersed in this environment and all my friends were from Latin America there, so I had like, I made very good friends from Mexico, Peru, and obviously Argentina as well.

And that also sort of allowed me to grasp, you know, more in terms of vocabulary in Spanish. So that was quite nice. During one of our trips, so that was around the time of when Mohammed deas won his Nobel Prize of Economics for microfinance. And something I forgot to mention is that previous to that exchange, I went to Burundi for the first time I, I was born Burundi, but I arrived in Montreal when I was one, I went to Burundi for the first time at around 18. And, I was shocked because, you know, Burundi is one of the poorest countries in the world, but I met some of the smartest people that I know of until today. Right. Yeah. So it was really interesting to sort of see how the private sector was ma that looked, the business that were working very well were mainly foreign on and like the rest, you know, everything that was, you know, development focus was, you know, centered around supporting the population, but also it felt a little bit like keeping them in that same situation.

So I, I noticed that, and it sort of shocked me and I felt like something needed to be done. I did not know what, but this also, that in addition to the narrative that not necessarily quote what I was saying also like you steer something, I wanted to do something about it. Yeah. So going back to my time in Latin America I think it was in the book store in, probably I think, and I saw this book, the, the, the title was in English, How to Change the World, and it was about social entrepreneurship and it was such, incredible stories about people from different backgrounds and different places around the world who basically decided to solve really, really big problems using.

Private sector, so building businesses around it so that they would be sustainable. Yeah. And, and, and I fell in love with the whole concept because, you know, not only are you building something that's sustainable, but you're also creating role models for society. Children who start looking at their parents, seeing what they're building, and having this understanding that they can build that themselves too.

And I knew I wanted to have something to do with, that world. Later on, I did an internship in Micro Finance in Burundi as part of my studies. And what was interesting as well too it was, it was really cool to be able to do you know, credit checks, but in a very different way. You know, you had to go to churches, so learn about, you know, people because there was not necessarily at that time, at least a strong credit bureau.

So how do you assess the character. Yeah, it's basically being in the environment and hearing what people say about others. Oh, wow. Which was super interesting. Yeah. And also very impactful because we're lending to groups of widows as well. Um mm-hmm. So you could also see. The impact it had in their lives.

You know, when you lose your husband and burn often you lose everything else. Like the top two at that time at least, was not necessarily attached to the Google, so it was really hard. So being able to provide a financial system where they could rebuild themselves and create some sort of economic autonomy was really, really meaningful.

So that was nice. I loved it. It was a bit grassroots, so I knew I wanted to still be around that level of entrepreneurship that was impactful, but not necessarily know how. I sort stepped back and see my study and ended up in the hedge fund world. So nothing to do at all with all of that. Wow.

Although I loved it. I think, you know, I guess a common trick in my life, I just really love based on the, by extremely smart people. I love learning. Yeah. And it was such a dynamic environment. I still speak to some of my previous colleagues up until today. It was it was one of the best experiences in my life.

During that time I did my C charter holder as well. And I became a CF HR holder. And then I also was part of this group of women bankers who were interested by this new concept, new for us, I guess, but I think some people have been doing it for quite a, a long time. But in 2008 JP Morgan came up with this report around impact investing, and I think that's really what created additional eyes on this asset class.

And we wanted to know what could we do to position Montreal with respect to that asset class. So we're meeting on a regular basis bringing speakers from all around the world. I think it was mainly at the RBC offices at the time, a really, really great experience. Then I, I was just like, this is really nice because impact investing is investing in entrepreneurs, innovators with the dual purpose of having social impact.

And generate financial attorney thought, this is wonderful. It's really what I wanted to do, not necessarily being the one that will build the business, but supporting all of these in innovat, having impact at scale. I thought about you know, the big problems that are being solved in emerging markets and, you know, sort of even combining my ambition of changing the narrative.

I was looking historically at, some other populations that went through a bit that same rep reputational misconception as the black community. And were able to change that, turn that around was lead by creating strong countries that where the table and then that basically sort of, decreased that least similarly, that misconception.

So I thought, you know what, why don't, why, why, why don't I try to support innovators on the African continent?

Kelly Kennedy : Yeah.

Lise Birikundavyi: So, so I decided that this was my, my next mission. I I left my job that I really love to do an m mba Oh wow. In China, because I wanted to better understand the China affair relationship.

It was a, a continent that I had no exposure to at all. I wanted to learn the Chinese world brain business. I wanted to create a network, and I wanted to learn by. So I spent two years there. Wonderful Experience made great final. I think the, I earned a lot, like the thesis around my MBA was around impact investing.

Yeah. I probably volunteered for every impact investment it meant on these and Continental, those three years. Oh wow. Like I really wanted to learn, I was really passionate about what was happening and came back to Canada. And worked for a little bit with asset management, which is a funds up fund that is investing in funds, in emerging markets.

And, and that was also quite nice. I, it's a great team doing really impact work. Fast forward a few years later, during my first maternity leave, I decided that I wanted to use something very, very different. So me, and it was also good. Timing for my life partners. So we both decide that we're moving to Vienna with Engineers Without Borders Canada, but I mean Wow.

And that we're basically so I was supporting them, creating their impact investment firm, that activity. They were just starting that. And he was supporting them with angry businesses, providing business consultant support for them so that they can grow and become a bit more sustainable. I was with Engineers Without Borders for a year. It was super interesting because I think I underestimated the amount of work that it takes to take care of a child in the first year and how fast without the support system.

Kelly Kennedy : My gosh. We have a, we just on, on that note, we have a 10 month old right now and he is a handful, so I can imagine.

Lise Birikundavyi: Yeah. Congratulations, by the way. Thank you. No, it was, it was quite something. Especially because I think that right now with COVID, everybody was, is used to serve like managing personal and professional situations all at once.

Yeah. But you know, I was a team of one in Indiana and you know, I was on calls with baby sometimes crying. So I had young, yeah. And still listening and take care of him. So I was doing that like four days a week at home. Then I would put all my new in one day. My partner would come that day and work from home.

So, but at, at some point we figure out a really good s support system and work well. But yeah, it was, was super, super interesting. Yeah. And so I, I stayed with EWB for one year and then I transitioned as the temporary CEO for Techstar that was based in Ghana. And that also was a really humbling experience.

You know, it's, it was nice to have that operational side and you wanted to go back to the investment side at some point, but you know, the, it was really humbling to hear investors on the other side of the table telling you what you would've told yourself in that safe situation like, but you know, but sorry, receiving that with everything that was happening in the back.

That was quite humbling and, and I, I, I really learned that experience from that perspective. I think I learned a lot with, goods and bads. The company's still going and the, the CEO's in charge of it now, but like, it was, it was an interesting experience for sure. Then I went back from the investment side and I was the in charge of the impact investment strategy

Running a fund that was investing in ed tech, doing direct investments, doing also fund investments linked to education and also funding. A venture builder was building companies in the education space all for and that was fun because we were teaching, touching different types of instruments at the same time, we seeing the impact of the different type of company, investees were, we're creating.

And I came to this being always finance first. You know, coming from the hedge fund world, I really wanted all the initiatives that we're financing to be sustainable and to be profit maximizing, because that's how I feel that you can eventually just get more and more dollars. Right? Yeah. So it was fun.

One of the challenges that I had and that surprised me while being on The African Continent is that it was not just for me, but for a lot of different investment vehicles. Money from outside often wanted to invest in investors coming from outside the continent. So that, that gap that I was trying to fill by like, funding you know, success stories that were local, bridging the narrative was harder than I thought even on the African continent.

And that's when I knew that I wanted eventually to own my own strategy because I could see, again, tons of really wonderful innovators. That just could not get the funding that they needed to create to just grow their product. But they were really good and you would see like lots of funding being channeled towards initiatives that had very little understanding of local context and would basically fall for things that were predictable.

So all of that really served like, it, it basically pushed me to. Gave a bit of a timeline. I gave myself a timeline to, you know, when I would start to do my own initiative. Then I was about to welcome my second son. So I just thought, you know what? Let's have a proper mat. Let's go home.

Kelly Kennedy : Yeah.

Lise Birikundavyi: Just for that.

So we we were going back to Canada and, and my second son was born in February, 2020. A few weeks before the world stopped working. Wow.

So it was supposed to be, you know, for a few months and I'm being, you know, a lot longer. Yes. I was, you know, home when the murder of George Floyd happened. Yeah. And although I didn't watch the video for a long time like I, I saw like all the hurt and pain of people around me. It's easy to forget what it is to be a minority when you, you spend a couple of years in a place where you, where it's no longer the case.

But there was so much pain during that time and I felt that I understood why I wanted to invest abroad, but I just realized that sometimes you have to start, in your own backyard. You have to clean things up at home. I, I I met with my business partner Isaac, during that same period of time who has done amazing things in Ontario working with the black community.

And he just saw eye to eye in terms of what he wanted to build investing incredible innovators and diversifying the face of success. So we decided to create BKR Capital, which was initially called Black Innovation Capital.

Kelly Kennedy : Okay.

Lise Birikundavyi: And we had our first launch in 2021. We went to raise $10 million and we oversubscribed to 22.

Beca becoming the first blacked VC fund in Canada, managing $2. Wow. Yeah. Yeah. So we made, history was a bit, you know, it was, it was interesting from. One side because, you know, it's, it's supposed to be the news on the other side, but like, okay, but it's 2021, this. Yes. It feels, you know, it feels quite late for this.

Kelly Kennedy : Yeah. That was, honestly, that was exactly what was going through my mind when I wrote that down. And I was just thinking how?

Lise Birikundavyi: Yeah.

Kelly Kennedy : You're right. It's 2020, you know?

Lise Birikundavyi: Exactly. So it's that it happened in 2021, we felt was quite late. And we, and the reason why we keep on mentioning it is because we sometimes it feels like.

There's no problems, you know, especially as we see a lot of initiatives or maybe people on CV or people talking on stage. But from a a capital, it, from a capital perspective, it's still an issue. Mm-hmm. You know, when we started DPR, 1% of venture capital dollars were going to black founders in North America in 2023 went down to 0.48.

So, wow. I think there's a lot of noise. People feel like there's change, but there's less and less money. Obviously there was a big crisis from microeconomic perspective, so money went down for everyone, but it was disproportionate when you looking at the black population or even women as well. Yeah.

So that, that's, that's a bit of our story and how we got there. We've invested in 13 companies today. We have a concentrated strategy. We looked at becoming part, becoming partners for growth for all the companies we invest in. And it's been a fun adventure. We're in, like our, the CEOs of our company are really, really special individuals.

They're driven and they're looking at changing the world in their own way, and we feel triple it's to be part of their adventure.

Kelly Kennedy : The work you're doing is incredible. I just want to like just start there. You're incredible. The work you're, you and your team are doing is incredible. Yeah. It's, it's unreal.

It's unreal. And you know, I look back at your story and I've talked to actually other founders and other companies here in Canada who are, who have been investing in Ghana and I wanted to spend a little bit of time there because you spent a lot of time there. What is going on in Ghana, because it sounds like some stuff is happening.

Lise Birikundavyi: Yeah, technology, west Africa. I mean, there's a very interesting economic growth. And I think also a beautiful lifestyle. I think that some, a lot of people serve, you know, have this perception that being in North America is better, but when you spend some time in Africa and you're sort of seeing, you know, changes in the infrastructure also a lot more help at home because over there it's, you know, it's common to have, you know.

To have these key people who will work in your house as well and to supporting you with certain things and just, I, I think just a better quality of life generally when I, what I love a lot about Ghana is that the, the music scene also was quite incredible and people were extremely I find people are happy actually go to the shopping mall and not.

Good music would be playing and you would find a group of people that say you just randomly and you just, just, I, I, I'm an extrovert, so I really capture positive energy. This is the type of stuff that would make me smile. Very warm culture in Ghana and Côte d’Ivoire in Nigeria. I think I've had, I had, I've had really great experiences there.

And for Ghana there was a, a lot of push, you know, around the year of return where they, they looked at, you know. Making people come and discover the country. Lots of touristic, attraction and, and, and I spent some time in Cozi as well in civic of the same thing where infrastructure has been built quite a bit, especially around the, the World Cup too.

Sorry, the the acon African CAPA patients for for soccer. So what. It's just such a nice environment, infrastructure. The beach is not far. People are really nice, but good, so it's worth at least going for not to sort of live, right. No snow.

Kelly Kennedy : As Canadians we're just like, we just wanna get away from the snow.

Oh my gosh. Yeah, it's it's incredible. Like I said, we've had, we've had a couple people on the show talk about Ghana and specifically about initiatives that their companies are starting to do there, and so it like kind of peaked my interest, not to mention. We have a really large listenership from Africa of this show, and actually one of the places is Ghana, another one is Nigeria.

We have a lot of listeners from Africa who listen to the business development podcast and I'm just thinking, man things have gotta be happening in Africa. People are building business.

Lise Birikundavyi: Yeah, right. The new is incredible. I think there's also, unfortunately there is a big gap with respect to employment.

Lots of under employment. I think they have a group of young people who are just very focused on changing their own destiny solving problems. Yeah. So there's a lot of lots of action going there from that perspective. Yeah.

Kelly Kennedy : Yeah. You know, you had mentioned, you had mentioned that a lot of the women you were working with were widows.

Is that just like natural disease or is that something else?

Lise Birikundavyi: So when I was doing this micro financing initiatives in Burundi, it was targeted at widows, so it's not that there was a particular issue around it, it's just that, you know, this part, this particular group wanted to support highly vulnerable people.

With those in amongst the most vulnerable people, but it was split. But yeah, since that, that was the goal of the initiative.

Kelly Kennedy : Oh, okay. Yeah. Okay. Okay. I understand. Yeah. I just, I was worried that it was like potentially war or something like that.

Lise Birikundavyi: Yeah. Yeah.

Kelly Kennedy : You know, one of the things that I really wanted to chat with you about today was specifically Venture Capital and what is it, where does it fit in, like the grand scheme of companies and, you know.

What should people consider or what, what are Venture Capital firms looking for when they're looking to invest in companies? And I know that's a lot. I know I just hit you with a lot of questions, so feel free to just give us a full 1 0 1 on venture capital and like I said before this show, we've talked to angel investors, so we've gotten that far.

We understand that much, but what we don't understand is the next part, which is venture capital. And so would you mind taking us into that today?

Lise Birikundavyi: Absolutely. My pleasure. I think to first start, it's really important to understand the role of venture capital. So why people invest in such a way. When you're looking at, for example, the main clients that VC funds it's not just the entrepreneurs, but it's also the investors and the institutional investors.

So they have a portfolio of assets that they're investing in. So they will invest, you know, in the stock market, they will invest in bonds like government bonds, for example. But they are looking at, usually because for example, they're, they're managing your pension. The amount of money that, that they're managing needs to keep growing.

So venture capital is an asset class that allows them to have exposure. To outsize financial return so that it can help grow their pool of capital and also, and just respect their obligation towards you. And once you retire and you need all the money that you've saved, saved for, and that promise of, a growth with those savings.

So when they choose who to invest in, they have to have this confidence that we are investing in big teams that will choose the right type of businesses that will help them grow their asset. So I'm, I'm starting with that just because sometimes I feel that people script see people with managing assets and saying, well, you should just put money here.

Just put money there. Mm-hmm. But there's really this obligation of performance we're taking risks at and a high level of risk, but we're doing it with this mindset of how do I get this type of financial returns? And it's not just greed, it's about, that's the purpose of asset class for some of the investors.

The goal in the market of venture capital, which is really cool, is that it also funds most of the innovation. So, most of the really innovative tools or products that you're using today has eventually been funded by a venture capitalist. So we need about Uber DoorDash, you know, everything that's making our life a little bit easier.

Yes. Instacart received VC dollars at some point. They took the risk to create something that was a bit different. We also can see that, you know, although venture capital is extremely selective, it said, one of my advisors was telling me it's a no business, right? So you have to say no to 98% of the startups that you're seeing and you're sort investing that one or 2% startups because you're looking for those plans and for those opportunities you feel will outperform the market.

So if you're looking in the past, was there was a 20 year study in the US where they could see that only 0, 20 0 5% of businesses have been funded by venture capital firms. But if you looked at IPOs, about half of the businesses on the stock market were funded by venture capital firms, which showcases that the companies that are going fast, that are super innovative, that are hiring like building value, usually have in back by right.

So that's also the, the super, the very important role that venture capital firms having the market and driving innovations, having growth. So having said that, how, like, what, what do venture capital firms look for? So we're looking to partner with individuals that have this growth in mind as well. So often, you know, you will see, like we do see some people that, you know, have a bit of a, like, they have good ideas.

You wanna have a business that will be successful, but if we can't see them making a certain amount of money so that the golden number is basically how, what, what's the pathway towards, a hundred million dollars annual revenue? So you can have a business that is really, really great and you're like, oh my gosh, I can definitely see this business making, you know.

Five to $7 million per year, which is a good business. This is not a VC business because this is not where the VC would make outsize financial return, but it's a good lifestyle business. So, and this is also what people have to sort of like realize. So how going and choosing a venture capital firm to finance your business at this level of stress where you have to grow, grow, grow.

You cannot just, you know. Mm-hmm. Say it's enough.

Kelly Kennedy : There is no ride it out.

Lise Birikundavyi: Exactly. Exactly. And it's also, depending on how you're looking at exits as well, because some, you know, some entrepreneurs and totally have the right to have that vision, want to, to stay owners of their company forever or even pass it down to their children.

If you it won't necessarily work like that, whether it be firm, where the whole goal is to sell the business at some point or make it public. And us and usually CEOs of eventually capital firms will end up owning very little in terms of ownership of the business, but very little of a lot of money.

Which, you know, usually is better than having a hundred percent of a business that is, is worth a little. Yeah. So those are the consideration to keep in mind.

Kelly Kennedy : Wow. Wow. Okay. Okay. So typically you're looking for companies that you guys can ultimately see making about a hundred million dollars annually.

So that's a lot. That's a big jump from, you know, a lot of these angel investor numbers. How does that work exactly? Do you look at, do you look at a company and you're like, yes, I think this company can do that. Or is there potentially like a set revenue that you're looking for them to hit before you'd consider them?

Like for instance, if you're looking for a hundred million dollars, obviously that's gonna take investment, that's gonna take some extra help, that's gonna take some stuff. What are you looking at in a company to make that determination that they could become a $100 million a year company?

Lise Birikundavyi: So first and foremost is a long term, right?

So we have to sort of really who can try to read the future. So we're looking at the company today and seeing what are the different indicators that supports that growth. We invest very early, so we invested the c and six stage shop and has happened that some companies don't have revenue yet.

So the most important indicator for me, for us to start is the founder. Or the founding team. So when they have a team, and sometimes it's really nice when they already have experience because entrepreneurship is extremely, extremely hard. I think people saying that is one of the hardest thing in the world.

And sometimes you have people who have never done it before, but have, you know, have big dreams. But once they get in there, they realize how hard it is and they're like, you know what? It's not for us, right? Mm-hmm. So having a second time founder is very interesting because. They know. You know, they really know.

And they're like, I want want some more. You're like, okay. So you know what you're getting into.

Kelly Kennedy : Yes.

Lise Birikundavyi: So that's one thing. And even if you don't have the experience knowing we have one of the founders in our portfolio. It was funny because you could sense that experience interacting with him because he comes from an entrepreneurial family.

So he's seen, you know, his parents go through the different cycles, so again, they understand what they're getting into. And second is also to have an understanding of how much they know about the business they're in. What's their unfair advantage when you see a a, I guess, a subset of entrepreneurs who really want to sell their problem.

They're looking at a problem from outside. They were outsiders. They looked at it, they're like, okay, this needs to change. Maybe they were a customer of the issue, but they haven't spent enough time like being inside, understanding what drives people, because imperfection doesn't mean that people are willing to pay for a solution.

Mm-hmm. Some, you know, there's very imperfect settings for different reasons, and if you have a really in-depth understanding, and also a non unfair advantage in terms of the cha, the distribution channel. So if you know that. For example, in a certain space people spend a lot of time doing certain things and while they're doing that activity, you can connect with them and sell them, you know, your product to your service.

Maybe that's information that others who are not in the space will, would never know, but you know that. Yeah. Is your understanding how much that founder understands the ecosystem they're in? We love to see a bit of a team as well. What is great, some of the founders in our com, in our portfolio are just able to attract talent.

It's funny because you see their teams looking at them and being like, I what part of this adventure? Yes. And, and you know, and early on in this journey, you don't have all the money in the world, obviously, and it's going to be tough. It's long hours. So you have to be able to inspire people around you to follow you and people who make not more money elsewhere, but to see that division, that mission, right?

Yeah. So like seeing these, these leaders or these people who are transforming into leaders, having that, that gen that are able to find talent and get people to want to work with them is also important. So that would be it, that that's what we're looking at in terms of the founding team. Then we're looking at the market as well.

So we ha you know, sometimes it has happened that we're servicing team, like, oh, they're amazing. We don't believe in what they're building. Mm-hmm. You know, for example, we don't think that this is going to go far, but you know, this, if they were doing something else for sure.

Kelly Kennedy : Oh goodness.

Lise Birikundavyi: So it's like the size of the market we had, like, you know, where the market is going how much competition exists as well. Because sometimes if you're building a feature and you feel, and, and I know that a lot of people take offense in. The question know, what if Google built it or what if Microsoft built it?

But I've seen founders spend a lot of time on like features that then I've seen Microsoft roll out and I'm just like, you know, it's, you have to have this ability to to build with something that, that is defensible, right? So that the product, their ability to execute and looking also at the ocean of the market as well and the size of the market is important.

Kelly Kennedy : For founders that are really looking to secure VC funds, let's say they've been through seed, pre-seed, all these things. They have angel investments and they're thinking, okay, like obviously the angels are telling them, Hey, you guys need venture capital. They're thinking it. How can founders stand out to a VC fund?

What are some of the things that they can do internally before they even start looking for VC?

Lise Birikundavyi: That's a very good question. You know, most of the time, especially even if we're investing early, what we're looking to do is to support a founder that has done their homework right. I think that them already, already having a clear idea of their, the parameter trying to solve and just making sure that they are out there, that we understand who their stakeholders are, that we really have a clear idea of.

How to go about the first few months of their business because sometimes it's interesting, but you, you, you get in front of people who are almost thinking out loud in front of you, you know?

Kelly Kennedy : Mm-hmm.

Lise Birikundavyi: And or are just, you know, feel like they're almost, they're not necessarily structured and, and, and looking at winning in their space in an effective way.

As a venture capital firm, you wanna be that thrill, right? But you, you can't do it if there's, you can't do it if there's no fire. So they have to be that fire and they have to be extremely intentional about the different moves that they're making, understanding the market, creating the signals, being ready to pivot if that needed.

But you can definitely tell, you know, when a, when an entrepreneur's always thinking, and it's a, it's, it's grasping the information and it's adapting and you wanna be part of that story. So I think that the first thing that we should do before that any entrepreneur should do before getting in front of the VC is really have an in-depth understanding of the problem that they're trying to solve.

Understand if this is an actual problem for the people that they're solving it for. If there's a real ability and willingness to pay and, you know, and have an understanding of how they get that unfair advantage, why them, you know, versus somebody else to solve that issue. And also we have to understand why they want these dollars too.

Because, you know, like you said, you know, angels can, can push someone saying, Hey, I wanna invest, but I want you to start having conversations with VCs. You might not necessarily be ready for that level of pressure. Maybe you want more time to be able to figure things out before you actually get that external who will start, you know, asking you to move faster.

Yeah. So just really being intentional and aligned with every step of the process.

Kelly Kennedy : Lise, what happens when VC finally steps in? You know, take us to this like, that's like a moment that almost every founder of a tech startup is looking for. They just have it in their head. Like, what happens when we finally get that help?

What actually happens? Can you walk us through maybe some of the companies you've invested with and like what happened to them once VC stepped.

Lise Birikundavyi: The world changes, the sky becomes more blue. You know, it's sunny every day. The bird sings.

So the way we position ourselves, and this is true for us, when I learned, we invest in a new portfolio companies that did the part of our family, right? So we wanna be there to. Support them and become strategic partners for them. But again, as support, you know, like we're not part of the company, we're investors.

So, so that they can use us the way that benefits them the most. Before I talk to what happens after, I think that there's probably not enough time that is spent around the negotiations before an investment. So, you know, we want the VC dollars, but you know, once due diligence has passed, fortunately, all depending on the length of the due diligence and who the metric capital firm is, it can be long, lots of documentations to pull out.

We have to have a robust data rule. And then there's the legal negotiation, negotiation around the valuation. And as with any negotiation, you know, you and some, you some. You really have to understand what's the value that you're looking to get on the other side of the table. And you might not get the value that you wanted, for example, or there might be certain terms that you have accepted that you're not necessarily happy.

But same thing on the other side of the table, where we also might have conceded things that we don't necessarily concede already. So that whole process has its ups and downs, right? So you know, you're closing it, but you're closing it, it's the end of a race. So that, that's also, that also can be a bit tiring.

Then you get the money in the bank and the work starts. Know that a lot of these funds in Canada are look at, you know, bringing a lot of value to their founders. They will open their books or contacts for that. So if you need support in any types of way reductions to companies or even like in the fundraising process, commit to that.

To basically an investee. You'll start, you know, talking to the other venture capital firms in your network and start selling that investee even if they're not in the room. Right? Because you want them to also be seen and receive additional funding. You know, we at BT R for example, have, discounted have negotiated discounted services for key items that we believe are important for startups. And sometimes he doesn't invest early and they don't have these items in case. So for legal counsel, for example, having, you know, lawyers, and often that happens before we actually invest in the company, but lawyers that understand the tech space or for, you know, accountants you know, payroll software and have a head of talent that works with us on a fractional basis.

So. You know, often it's the first time you have to manage your team. So understanding how you do performance reviews or how you hire you're better or how to deal with certain issues that we never had to deal with, you know before, is really nice to have somebody else to be able to talk, that you can talk to about these issues that can provide you tools.

We become a bit of that basically part that they can call on when they need. We're being on governance even early, so we often ask for a board to be set up. So that becomes, you know, we have those party board meetings and want our, our companies to just be set up for success so that they're used to having those conversation and to just make all their business in order to be able to present it so that as they grow, it doesn't become a big shock as well.

And as much as, you know, sometimes do have a bit of pushback at the beginning. Most of the feedback about having a board has been super positive, right? Because it's all about who you bring onto the board and you know, in terms of level of expertise. And you, you also have to be, you have to have this level of trust too.

They've all been super grateful to, surrounded by people with that level of expertise and that level of support. So that has been something that we've been quite happy to have been so pushing for most of our particular companies. And, and yeah, it is a little coaster because not only you have to deliver from a business perspective because, you know, do ask for performance, you also have reporting that you basically have to produce on a regular basis.

But I think that you know, mutual entrepreneurs feel quite alone in their journey. And having, you know, metric capital firms as partners is often something that really helps. We see so many other businesses. Yes. You know, we've seen so many businesses, so we both serve the advantage, and most of us will answer the phone, you know, late in the evening on the weekend.

So we're there to really support because we have this vested interest. It's not alone where you know you're getting your interest regardless, or like you asking for your money back. Regardless of how the company's doing, we're all vested in the success of the company. And because of the time takes for due diligence and co partnering, we're all invested in each other's wellbeing to a certain extent as well, right?

Yeah. So yeah.

Kelly Kennedy : It's not just money. It's like money and a pile of knowledge and a best friend at the same time. Yes. That sounds pretty good. Yes. The best friend

Lise Birikundavyi: that you have to be accountable to. Yes.

Kelly Kennedy : Yeah, yeah, yeah. You know, by the time VCs get involved, you were mentioning that like so many big companies, if you look back, VC was involved at some point.

Does it greatly increase the success rate of a business? I know with, like with Angel investing, I was kind of being told that like. It's a very small percent. I think like, I think they mentioned like 5% or less. I can't remember. It's been a minute since I've had that interview, but it was very, very low.

It was, it seemed like a hell of a gamble to be in the angel investment world by the time it hits VC level, is the success rate quite a bit higher?

Lise Birikundavyi: It's probably higher than Angel for sure, but it's still very low. Especially like I'm talking about our stage ping nnc because it's high risk.

When we're thinking about entrepreneurship generally businesses tend to fail quite heavily. We, when we invest in companies, the reason why we want so many of them to have this vision towards that a hundred million dollar pathway is because we actually swap one or two of them together out of all the companies that we have invested in, right?

So we can't sort of come in and sort of say, oh, well no, you can't come in not being sure because life, is uncertain. So you have to be sticking, have full faith at the beginning and then try to see how to make that happen, but feel your weight is high. It's funny because on our end, because of our mission, we're a little bit less accepting actually, right?

Yeah. So we really want all of our, you know, I think some venture capital funds, you know, really understand the power law and just understand that yeah, we will have the companies that will be fund returners, meaning that it will make all the money at your fund, that it will give you back the money, up the size of the funds so that you can at least reimburse your investors.

For that basis. Yeah. And then we have others that will also like, give all of that interest and all of that coffee that, that, you know, will be your the extra. But we, well, all of the companies to be from, that's what we're working at. The of course, although, you know, it might not have been super realistic when, this is the challenge that we have decided that we'll try to to basically go after.

Kelly Kennedy : Yeah, no, I, I totally get it. It's like any investment, it's like, it doesn't matter at at what level. There's always a level of risk and you definitely wanna mitigate that wherever possible. I guess in my mind, I kind of thought, and I'm surprised by your answer actually, 'cause I kind of thought that by the time it hit VC it was a damn near certainty.

And it sounds like that is not the case.

Lise Birikundavyi: But that's why we want that. That's why the return with plan is so high is because. It is a hard job. It is a hard job. And when I was talking to you earlier with the investment from the institutions, when they wanna have Sure return, they will go on stock markets because you know, you know that with time it still goes Yeah.

You know, in a certain direction. And they will go with money like the old government bonds when market instrument. But when they go towards private equity, which is already a little bit less risky than we see and, but they still, you know, require higher return than what they would, or, you know, what, what is public investment?

BC is the riskiest asset cost. That's why we, that's why we want to make a lot of money to sort of compensate for all the losses, right?

Kelly Kennedy : Mm-hmm.

Lise Birikundavyi: And when we started seeing BC there's different capitalism, B, C, so we invest early stage C and C, so that's a lot risk built, for example, that those who are focused on sim A and B.

Then you have those C and d, you know, and then E and up. So depending on where you are in that, chain, value chain, then that's, you know, level of risk is different. But we're still at the early stage, so our level of risk is higher.

Kelly Kennedy : Yeah. Yeah. No, that's fair. That's fair. You know, we're coming to the end, but I want you to take us into BKR capital.

You. What are you guys doing? What type of investors are you looking for? What's on the horizon?

Lise Birikundavyi: Keeping in mind that when the episode goal. Yes, we'll have, you'll spend a lot of time.

Kelly Kennedy : It'll likely be summer fall 2025. So we're actually recording this at the moment in October of 2024, just to give our listeners a little idea so they could be like frankly, 10 times further ahead than they are right now.

That's what I'm hoping for, Elise.

Lise Birikundavyi: Thank you. So right now, at this moment in October, 2024, we are finalizing the deployment of our first fund. We're also have, we also have started raising for a second fund. We're looking at raising for $2 million fund. We have 13 portfolio companies. We'll probably add one of two additional to fund one.

And we're looking for fund two have between 20 and 25 companies, we stay sector agnostic. We partner where we can add diagnose. It means that we still have to have a level of understanding. The space, you know, sort of looking at our own network and feeling that there are additional ways that we can add value.

I know in addition to the capital and our general thesis stays the same around diversity.

Kelly Kennedy : Amazing. Amazing. And like, where are you funding? Are you specifically funding companies in Canada north America, the world? Where do you, where are you looking?

Lise Birikundavyi: So we're, so for fun one, it's 90% Canada and 10% outside.

And outside includes the us. So I think the companies have to be at least register in the US because that's a jurisdiction that we understand. And then from the women that they're based here are in the us. But what we've seen often is that the entrepreneurs that we have are so, driven that they're looking at extension very fast.

So. The coverage of our portfolio companies is quite wide. So we have lots of activities in the Caribbean augustly the US on 20 plus countries in the African continent. Wow. So it's quite like, yeah.

Kelly Kennedy : Wow. Okay. Okay. And what types of companies are you looking for? You did mention your industry agnostic, however, I'm sure there's certain things that you're like, okay, I wanna spend some more time in this.

What might those look like?

Lise Birikundavyi: We love FinTech. FinTech is one area that we are seeing, we're seeing a great deal of deal flow around financial technology. So this is something that we're quite excited about especially with is talking about AI as a way to support blockchain as well. I think we're seeing a lot of companies that are trying to solve for the hiccups that exist when it comes to international transfer and remittances.

So we are really looking forward towards like the next generation of companies in that space. Cybersecurity is a space that we find is quite interesting, especially around the issues that will start coming over, you know, for example, yeah, it's quite scary to think about. Very, you know, with, with, again there, there's a lot of work also that's being done in trying to make sure that we can't attend to create, videos or presence or, or, or voices in a way that it's not applicable.

So that's something that interests us quite a bit. The future of healthcare as well is at least that we love, have invested in amazing companies in that space. You know, working, for example in trying to support patient with dementia which is something that will keep on growing, unfortunately with our aging population.

So how do we support our communities as they age is important.

Kelly Kennedy : Mm-hmm.

Lise Birikundavyi: And just also how do you keep on better understanding how biology works so that you can provide treatment that works for everyone, despite the differences. So that's what we've been, you know, doing for fund one.

And we'll look at, you know, additional initiatives in that case. It's really interesting that, you know, our companies are working on subject that affects everyone, but with that inclusive lens on top of it. So it's really for everyone. It doesn't need anybody, anyone behind. So we're looking at more of that.

We we're quite excited as well. We're sector agnostic, so lots of things excite us, so we're quite excited as well. About clean energy feedback.

Kelly Kennedy : Yes.

Lise Birikundavyi: You know, this is something that is big for us. We have invested in the company that. Is basically supporting the exchange of carbon offset and want, and, and also just make it more accessible for individuals to offset their own carbon footprint.

So looking, actually know how we can have even more of those case studies where, you know, everyday people can benefit or can just, be better at their consumption from a tech perspective.

Kelly Kennedy : Amazing. Amazing. And if we have companies listening who are like, yes, that's me. Do you have a way that they can reach out to you and introduce themselves?

Lise Birikundavyi: Absolutely. I'm on LinkedIn, so Lise Birikundavyi, we can reach out on LinkedIn. I'm also through our website as well, so we have page we where you can sign up. If they have a company, it's really good that they, give the link to their pitch deck because of the volume of text that we of requests that we receiving.

We only get back to companies that actually provide additional information that that we can assess or directly to my email leads at BKRCapital.ca more than happy to hear from founders.

Kelly Kennedy : Amazing. And I will have all of this linked in the show notes and on the website. If you find this and you wanna find out more, it'll be there.

Lise, this has been absolutely incredible. You are talking to a whole bunch of entrepreneurs. You are an incredible entrepreneur yourself. You launched an incredibly successful company in the worst time, I feel like ever to launch a company 2020, the middle of COVID, and you've been, you've done incredible.

What's the best piece of advice that you can give to a new entrepreneur?

Lise Birikundavyi: It's also cheesy, but I really believe that we have to follow your, that follow your Einstein and be the word. It's, it's, it's straightforward, but I do believe that it's we're all made for something to do something specific and sometimes we know that, this is the path we want to follow despite know what anybody else wants to tell us.

Really follow your gut, do the work, and you'll get there.

Kelly Kennedy : Amazing. Amazing. Follow your gut. I love it. I love it. This has been episode 268 of the Business Development Podcast. We have been graced by Lise Birikundavyi. She's the managing partner of BKR Capital. It was an honor to have you on Lise.

Lise Birikundavyi: Thank you, Kelly.It was such a pleasure being here.

Kelly Kennedy : Until next time, this has been the Business Development Podcast and we will catch you on the flip side.

Outro: This has been the Business Development Podcast with Kelly Kennedy. Kelly has 15 years in sales and business development experience within the Alberta oil and gas industry, and founded his own business development firm in 2020.

His passion and his specialization. Is in customer relationship generation and business development. The show is brought to you by Capital Business Development, your Business Development Specialists. For more, we invite you to the website @ www.capitalbd.ca. See you next time on the Business Development Podcast.