Meet Sandra Golbreich from Baltic Sandbox Ventures
Sandra Golbreich is a General Partner at Baltic Sandbox Ventures, the first specialized early-stage VC fund in the Baltic region investing in deep tech and life science startups. Baltic Sandbox Ventures makes seed-stage investments in teams solving complex technical challenges with large potential for commercial application, and supports founders by running incubation and acceleration programs. For the second year in a row, they are awarding up to €125k investment to one team at the sTARTUp Pitching 2024 competition. We asked Sandra what sets Baltic Sandbox Ventures apart from other VC funds, how they support founders and what’s her advice to participants of this year’s pitching competition.
Can you tell us a bit about Baltic Sandbox Ventures? What prompted you to set up the fund and where is your investment focus today? What sets you apart from other funds in the region?Baltic Sandbox started off as a fully privately funded accelerator with a more generalist and thematic focus; for example, we pioneered the first ‘Silver Tech’ acceleration program focused on the needs of global ageing populations. It is through our experience over years of running such programs and supporting startups that we as a team realised the potential and importance of Deep Tech and that startups with a fundamental scientific and R&D edge are ones that – in the long term – are building fundamental value beyond SAAS apps with no fundamental differentiation focused on putting ‘screens on databases’. There are tonnes of product innovations in SAAS, am not discounting the level of execution and effort it takes to succeed there; however, we believe that beyond mere unicorns, that the juggernauts of the future will be companies that have a fundamental hard-to-replicate advantage on the technical level in addition to doing everything else that builds a successful venture, from growth to operational excellence in their execution.
Our fund Partners are active entrepreneurs as well, building in Deep Tech and Life Sciences; we have a deep appreciation and understanding of the challenges, pitfalls, and problems in the funding ecosystem in the local region. We’re glad to see more funds realizing the need to back our innovative and scientific teams and how this is critical not only to the resilience of our region from a defence and economic perspective but we believe will produce the best returns in the decade ahead from a venture perspective. Our ability to understand, support, and tactically enable teams to execute at the riskiest early stages of their journey is what primarily differentiates us from other funds.
Baltic Sandbox Ventures originated in 2022 from Baltic Sandbox accelerator which has been active since 2018. What have been the milestones of the first year for you?We’ve been working on building this fund for a while; however, started our operations in 2023. In this first year, we’ve made 11 investments, with 9-10 more deals in progress, deploying over 1.2M EUR in investments and grants to support Deep Tech innovators in our region. We’ve completed our first acceleration cohort with our second one ongoing and are seeing many venture funds realising the potential of Deep Tech starting to participate with us in our deals as well.
We also run free incubation programs for scientific and R&D-focused teams from various universities and R&D institutions in our region and have so far run 3 incubation programs with 112 participants in life sciences and deep tech, and just few week ago we started the 4th incubation program with about 70 participants.
In addition to finances, in which other ways do you help deep tech founders tackle the challenges they face?Acceleration, ongoing support even after the acceleration (we don’t just forget about them; crises for example, happen, they call us any time, our partners make ourselves available proactively to ensure our teams know we’ve got their back and are willing to be hands-on in supporting their success, whether we’ve invested only 25K or 125K or will be doing more from our Seed Fund where we aim to invest up to 500K in teams that have come through our pre-seed funnel.
We’re not a one-and-done type of investor, deep tech often requires both intelligently allocated financial backing in addition to tactical and execution-oriented support due to the higher degree of complexity involved, we understand this, and that perspective and depth of understanding is why founders prefer to work with us.
You are giving out one investment at sTARTUp Pitching 2024. If you could give one piece of advice to founders participating in this year’s pitching competition – what would it be?Focus on your value add, of course, it’s important to articulate well what you do in simple and clear ways for most investors in this ecosystem, however we have a greater degree of technical understanding in our partnership who will be present as well, and it’s important to ensure you outline what your fundamental advantage is and have clarity in relation to how you intend on leveraging that to unlock value for the customers you intend to serve.
A deep understanding of (and having talked to!) your customers is critical to impress us as well. Innovation is great, but it also needs to solve important problems you have a nuanced and deep understanding of when it comes to the people you’re serving. This, in addition to your team and their commitment, coachability, and ambition is what we’re looking for. That matters more than the ‘glitz and glam’ – so don’t worry if you stutter on stage, keep going, you got this!
Many startups take part in pitching competitions, but there are usually only a few winners. How can other teams maximize the benefit from participation?Whether you win at pitching matters less than whether you win in the game of business, and while pitching and the ability to articulate what you do is important, building an amazing company that adds value to customers and solves big, meaningful challenges is the key thing here. As much as it’s your job to articulate what you do well, we believe as investors, it’s our job to understand and ask good questions, too. End of the day, not everyone is going to join you for this journey, that’s the reality, focus on those who are right for you and orient your message to them, they’ll be there, listening, if you’re building in deep tech then we’re the ones you’re talking to – whether you win or not, focus on creating something of value and getting the message across, if you do that it is a good outcome regardless of what prizes you get.
sTARTUp Pitching 2023 awards ceremony in March 2023
You have been active in educating new angel investors in Lithuania through initiatives like Innovation and Investment Academy and Business Angel School. Does the current economic climate favor or disfavor new angels?True, and our Angel School has had participants from all over the Baltics and Europe as well as internationally. We pioneered this concept in the Baltic region. About the current economic situation, if you look at previous financial crises, from the post .com era 2000-2002, and the Financial Crisis of 2007-2009, the best venture vintages were around those times due to the fact that founders building ‘me too’ companies or with lower depth of commitment and conviction end up failing, and it brings out those willing and able to execute at a high level even when times are hard, enabling them to gain market share as competition fades away.
We feel this is exactly the time to dive into Deep Tech and back amazing teams because that is what will generate the best returns for our investors in the fund but also enable the Founders we work with to have a huge impact on the world and their teams as they achieve the success we know they can.
As for angels, there is a risk that investments they make may not get additional funding from other VCs. This is not investment advice to anyone, for clarity, but if I were angel investing I’d work closely with funds that have managers I respect and potentially aim to participate in deals together knowing that it reduces the risk of companies I invest in not raising future rounds. At Baltic Sandbox Ventures, we invest both at Pre-Seed and Seed, having two-funds-in-one, and the majority portion of our Seed Fund capital will go to companies we invest in at Pre-Seed, which means that our investing into a company means there’s a higher likelihood of follow-on support and investment from us, which many other VCs aren’t committed to doing to this extent in our experience.
Angels are welcome to participate with us or reach out to learn more about companies we’re backing or share information about companies they’re considering. Again, this is not an invitation to participate in any investment, and angels should consider educating themselves on both the domains of startups they invest in as well as the markets, considering their own risk profile, before making any investments. We aim to support angels in this process through the activities of our Angel School and other efforts working with the local ecosystem across the Baltics and Nordics.
Read more about sTARTUp Pitching 2024 or fill in your application now. Applications close on 17 December 2024.
Articles you might also like:
Startup Estonia Deep Tech Lounge offered insights for deep tech founders
For the second time at sTARTUp Day, Startup Estonia hosted the hugely popular Deep Tech Lounge, featuring engaging conversations with experts and...