John Yeomans’ journey from engineering to becoming a leading figure in angel investment is nothing short of inspiring. With a foundation in engineering from Cambridge University, John seamlessly transitioned into product sales, marketing, and eventually, investment banking during the dot-com boom. His early entrepreneurial experiences, coupled with a passion for supporting start-ups, laid the groundwork for his impactful role as a Cambridge Angel. In this candid interview, John delves into his multifaceted career, his approach to hands-on investment, and the lessons he’s learned from fostering innovative businesses across diverse sectors.
Can you give a bit of background about yourself?
I studied engineering at Cambridge. I moved from engineering to product sales and marketing before ending in finance, all in the telecom sector. Then I ran a dot com boom telecom investment banking team, taking it from nowhere into bulge bracket deal position. So engineering, commercialisation and finance is what I do.
When I was 24 I was also a cofounder of an office tech company – I did ok from it and had a small exit, but I also realised that there was zero entrepreneurial eco-system in those days. There were only about 4 early-stage VCs in the UK market and they judged by all the wrong criteria (minimal risk) so I vowed to come back to support the eco-system and I did; first through finance raising for growth companies and then, for the last 15 years, as an angel.
What made you apply to join Cambridge Angels?
I originally started investing in London. However my penchant was for deeper tech investing. A Cambridge Angel friend invited me along and I joined the group as I appreciated CA’s philosophy:
Helping entrepreneurs
Making returns
Social aspect (valuable for both knowing the relevant experts to go to and building trust between investors).
CA is a fantastic membership organisation and I did my stint as chair of it between 2013 and 2016.
Can you give a couple of examples of CA deals you've invested in that you're currently excited about?
One of the first was Wazoku, in innovation management. I led the first round; it’s still growing and I’m chair. Most recently I led a round in plinth (formerly Time to Spare). This is an AI SaaS platform for the very uncomputerised but massive (£68bn) charity sector. Although the superficial investor view is that budgets are stretched in not-for-profits, in fact donors are very happy to pay for installing this software as it provides fantastic impact management and administration support and thereby increases the efficacy of their overall funding. It has grown 10x in revenue but only 3x in staffing since I led the seed investment round 18 months ago, and is actually profitable.
Another one is Beam (formerly Rovco), a tech-enabled service business. It uses proprietary AI, imaging, undersea survey and autonomous offshore vehicles in offshore wind farm planning and maintenance, aiming to transform the sector’s gross margins. It expects £30M+ turnover this year, has a forward order book already twice as big, and has grown from a seed round 6 years ago to over 200 employees.
Do you have any sector focus and if you do, why?
I believe that every angel needs to work out not just their sector focus but also their approach to investing, which for me is quite hands-on. My focus is around software/tech and telecoms and I am open to hardware investing. However, I avoid life sciences and extremely deep tech due to their high-risk, arguably more from the big preference waterfalls that come with multiple rounds of investing than from the tech.
As with many investors I seek innovative, game-changing businesses, but not necessarily £1Bn markets.
How do you tend to get involved with your investments?
My background was tech, moving to commercialisation and raising finance. That’s exactly the path that most start-ups progress through, and I try to help them as best I can, often through active board involvement.
I am also unusual as an angel in that I tend to stay on the board of my investments beyond the angel rounds. I think this is important as many VCs don’t have the risk tolerance that fast-growing companies require. Often there are gaps in the management team at the early stages – I can help fill those gaps until they can be recruited for and I also help get the corporate governance right from the start; you’d be surprised how often small mistakes e.g. around share issuance, can really trip up a company later on.
What have you learnt about being an Angel investor since you've started?
DON’T DO IT (unless you are really committed and sure). There are a load of hygiene factors that have to be right such as the pitch deck, plan and business model, but most important is the management team; their adaptability, drive, vision and openness to challenge.
Also as investors we need to recognise that the role of a founder is a lonely one. They are expected within say 5 years to acquire the range of skills that most people struggle to acquire in a lifetime: we need to help them and they need to be open to it.
I therefore look for cohesive teams with complementary skills and a shared history, and realised that the best investments often come when angels are involved and provide active management and coaching.
On the funding side there are still major limitations in UK venture financing from series A onwards, with too much herd instinct, too much short-termism and too little technological understanding. We could do with a few more multistage, mature VC funds of the kind you see in the States. By staying on boards I span the lifecycle, which gives insight into what needs to be put in place in the early stages.
I’ve also learnt never to be surprised, particularly by human nature. On a more positive note, investing and interacting with younger founders has helped me remain positive, and for an increasingly cynical guy in his 60s, that’s so important too.
