All hail the Unicorn Kingdom?


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This week, I look into three topics that don’t have to be an “either/or” situation: France or the U.K.; product-led or sales-led; psychedelics medicine or traditional health care. — Anna

Cool or cringe?

“Welcome to the Unicorn Kingdom” is the slogan of a new U.S. campaign aimed at promoting the U.K. as “a place with all the right ingredients for tech success.”

When British prime minister Rishi Sunak referred to the new tagline at an event recently, some called it cringe. However, others beg to disagree.

To get biased national pride out of the equation, I reached out to Hoxton Ventures partner Hussein Kanji for two reasons: He’s London-based and a self-described “proud American.”

From Kanji’s point of view, calling the U.K. “the Unicorn Kingdom” shows how far the country’s tech scene has progressed. “There was a time where someone saying that wouldn’t have been taken seriously.” Not anymore, however: The U.K. has solid tech foundations, attracting 35% of the total capital invested in European startups in the last five years, and is now going through “the scale-up phase.”

Kanji’s one caveat about the “unicorn”-related term is that it emphasizes billion-dollar paper valuations, when the last couple of years showed that these don’t matter. As investors rebalanced their preference for profitability over growth, aren’t unicorns a bit passé?

Yet, it’s hard to beat the level of collective awareness that the concept has reached since VC Aileen Lee coined the term in 2013.

Looking no further than the U.K.’s historical rival, France, President Emmanuel Macron also chose to bet on “unicorns” as a concept and goal. There must be 100 French unicorns by 2030, he said last year — and that’s only a few years after wishing for “25 unicorns by 2025.”

Kanji doesn’t believe it is a zero-sum game. The impact of technology is going to be so big that both France and the U.K. are right to bet on it, just like Israel did by putting itself on the map as the “Startup Nation.”

As an American, Kanji is not as invested in the rivalries between the U.K. and other European countries. But it is hard to think that these didn’t play a role in the British government boasting that the country “has more tech unicorns than France, Germany and Sweden combined.”

Of course, this campaign is also taking place after Brexit, which had a wide-ranging impact on the British economy and politics. But when it comes to the tech economy, it’s “a little bit of a red herring,” Kanji told me, because there are still special visas in place for tech talent, and because borders are less meaningful for software companies.

“I am generally bullish not just about the U.K. but about Europe,” Kanji said. A mere decade ago, neither France nor the U.K. were really on the map when it came to creating tech champions. Now, multiple countries and cities across the region are trying to make technology a core part of their economy. And perhaps Kanji is right: It doesn’t have to be a zero-sum game.

CPO talk

Last week, I wrote about the rise of chief product officers. This week, I talked to a newly minted one: Andy Boyd from app collaboration software company Appfire. He was promoted into this role earlier this year, having previously been the senior vice president of product management and growth.

My conversation with Boyd quickly veered to product-led growth (PLG) and how it might be faring in a downturn.

Boyd sees at least one way in which this is misguided: that companies might want to go into PLG for the wrong reasons in the current climate, namely because it’s cheaper. Which it may well be, but it is also “hard work” and “requires a different type of investment,” Boyd said.

The good news is that product-led companies may emerge from the downturn in better shape than those that are sales-led, although Boyd also noted that these two approaches overlap a lot more than the terms suggest, as illustrated by the rise of product-led sales.

Mushrooms and Trojan horses

My latest investor survey focuses on the psychedelics sector, and while you may think of these substances as revolutionary, disruption is not necessarily the path to market that companies themselves should adopt. According to Tim Schlidt, co-founder and partner at Palo Santo:

Rather than seeking to change how our health care system operates, we believe this early generation of psychedelics must transform and adapt to fit within existing infrastructure. Those wishing to “terraform” our entire healthcare system to be conducive to psychedelics are in for a world of disappointment. Western healthcare models are heavily entrenched and sclerotic, and will not change overnight. Furthermore, some of the limitations to early psychedelic therapies are simply driven by socioeconomic factors — very few citizens have the privilege of being able to pay the sky-high costs of MDMA or psilocybin therapy out of pocket.

The dissemination of these powerful medicines into society will be incremental and won’t occur overnight. Rather than trying to storm the ramparts, we believe a Trojan horse approach is the only means by which these therapies can achieve wide-scale adoption.

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