Tim Heath on kicking his startup habit

Tim Heath brings a unique perspective to startup investing. He believes it is similar to navigating complex situations and making strategic decisions. Some days bring impressive results, while others present challenges. Regardless, he thrives on the challenge and enjoys the process of building successful ventures. In investing, as in any strategic pursuit, identifying areas of strength and leveraging them is crucial for success.

Helping an ambitious entrepreneur make their concept a reality has been Tim’s focus for many years. Although he will be open to occasional startup bets with his own capital, now it is time to focus his next fund, Yolo Fund II, on proven business concepts where both Yolo Investments and its LPs can add significant value and see sizeable returns.

What will remain the same, however, is their founder-focused mentality. Yolo Investments will continue seeking founders with drive and passion whose ideas solve real-world problems.

Although not centered around start-ups, Yolo Fund II is looking for those with a proven track record of success who know precisely what they need from a funding partner. They should be looking to leverage Yolo’s networks to reach the next stage of their business and have battle scars from prior experiences. After all, there is never an easy, frictionless way to make it to the top.

As an investor, Tim is looking to add value to those with expertise and proven concepts that solve real-world problems and take them to the next level, opening doors that may have otherwise remained shut.

Founders with proven concepts and significant growth prospects will know that they need to unlock the door to future success. What these entrepreneurs are after is someone who can introduce game-changing contacts, someone with a track record of successful investments and exits, and someone who is prepared to listen and offer their expertise to make a dream a reality.

With defined business models, there is growth capital, not idea capital. VCs like Yolo Investments can come in and work with founders directly to solve potential barriers to growth, streamline, and improve corporate structure while also working to leverage their network to push out the product. This is the focus of their second fund.

Finding the right founders

Ultimately, you enter to invest in the right people and to structure a business for growth.

ONE.io serves as a prime example of the above. The company saw the passion of the ONE team firsthand and its product offering, which served to simplify end-to-end financial services for corporate clients. Yolo Group actually uses ONE’s solutions in its everyday operations and has worked to add strategic input while also exposing the ONE brand to its ever-growing network.

Through strategic partnerships like this, they solve existing issues to the benefit of consumers while also seeing significant investment returns, enabling them to invest that capital in other businesses.

What can never be ignored is the founder at the heart of a business. Tim understands that they have put their blood, sweat, and tears into developing their company and that sometimes the helping hand and connections are just as important as the working capital.

When you pause for a second and think about what makes a founder a compelling case for investors, a few boxes need to be ticked ahead of any potential investment.

First and foremost, a compelling founder is someone who wakes up ready to solve a problem for customers and already has a sustainable business model that allows them to do that.  

Solving problems, however, is not sufficient. Investors look for connections between how this idea can ultimately make money for both their return on investment and the founders themselves. Tim and his team will work directly with founders to understand what they need to take their product to the next level, offering their own insight where required.

When a business model solves real-world problems and has a clearly defined path to making money, that is when investors like Tim will want to come on board and be a part of the journey to success. There will, of course, be other challenges, but in his experience, Tim has found that the finer details always take care of themselves. 

In short, the best products make the happiest customers and the happiest customers make the most successful businesses.  

When a product can speak for itself and when your customers are the ones who are recommending it, then it is successful. At this stage, it is pretty simple to sell and easy to market. 

This is what makes a great business and a compelling founder. 

As a serial investor, Tim Heath is always looking for that. He’s not only looking for people who think like him, but he’s also looking for people and businesses that ask themselves: Is there a better way for this to be done? Is there a better way to address the customer’s needs? Those who ask these questions often find the answers, create great businesses, and attract investors. 

Having an entrepreneurial mindset and a good idea is one thing, but using this to develop and market innovative products that solve real issues, which will, in turn, improve customer experiences and make money, is the ultimate win-win for investors.