The Sandpit, a new London-based “sales accelerator” for new technologies, says it is taking a 25% stake for “up to £500,000″ over the next two years in SoDash, a web-based tool that helps organisations to manage their activity on social media sites such as Twitter and Facebook. The Sandpit has an option to purchase a further chunk and also has the exclusive commercial rights to the product, enabling the tech team to focus on development. SoDash is a spin-out from Artificial Intelligence specialists Winterwell.
But who are these Sandpit guys?
Coming out of London, The Sandpit is a new kind of tech startup investment vehicle formed by serial entrepreneur Simon Campbell, formerly CEO of Viapost. He bills it as a form of early stage VC/incubator. It takes 10-30% of a company, wraps sales and marketing around it, and takes it to market – so this is quite a bit different from a normal Seed or VC deal.
But let’s take a look at the issue this ‘sales accelerator’ is addressing.
You are familiar with the story. An amazing hacker engineer creates a great product… which then fails miserably to get any traction because they don’t have the commercial skills to market it or perhaps even sell the product into other companies that might buy the service and create a revenue stream. Ad to that the process of trying to raise venture backing, which is extremely time consuming, and you have a recipe for disaster. In an ideal world they find co-founders who can do all that stuff. But this often doesn’t happen, and the product misses out on its day in the sun.
What Campbell has done has created, if you like, a sales and marketing accelerator for tech companies allowing the tech founders to focus on the product, cover some costs and put marketing around the product to generate real revenues – instead of trying to go fundraising immediately. Having an income – and let’s not forget that even Saul Klein of Index Ventures once said “customers are your best form of financing” – means the startup can either grow without needing investment or get a much higher valuation when it does.
SoDash’s early development was supported by the Scottish Enterprise’s SMART:Scotland programme, and by the University of Edinburgh’s EPIS programme. The technical team is staffed by former AI researchers from the University of Edinburgh.