Several prominent figures from the Flemish tech world establish the 'venture studio' Miles Ahead. It sits between a tech fund and an incubator, offering young AI companies a total of 35 million euros in capital and support from experts.

Our name is inspired by the jazz legend Miles Davis," says co-founder Wim De Waele about the name of the new Gent-based tech hub, Miles Ahead. "Just as in jazz they have to improvise, so do starting entrepreneurs and their teams often have to forge their own path. It often takes a lot of time for them to develop their startup into a commercial product. As a result, follow-up investments and the so-called Series A round are delayed too long, due to lack of references.

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The founders of Miles Ahead aim to bring together investment capital and, with the expertise and experience from their network, shorten the learning curve for startups. De Waele has a wealth of experience in guiding startups and scale-ups as the former CEO of the Gent-based tech incubator iMinds, which later merged into the Leuven-based research institution Imec as iStart. Luc Burgelman once co-founded the IT company Porthus with Peter Hinssen and later served as CEO of various data companies. Alain De Taeye is the founder of Tele Atlas, which was acquired by the Dutch navigation technology company TomTom in 2007. Maarten Mortier served as the technology manager at Gent-based tech companies In The Pocket and Showpad for many years. Frederik Lebeer is a former consultant at Bain Consulting and an investor at D’Ieteren Investment Group.

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Success Rates

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"Actually, we are a venture studio, an investment fund with the characteristics of an incubator," says De Waele. "What a fund lacks, expertise and coaching, an incubator provides. Conversely, an incubator has little capital. We strongly emphasize hands-on guidance for startups and hope to increase the success rate of creating a top company. In a traditional venture capital fund, the success rate is 1 in 20, but in a studio, it should be 1 in 10. That will have to be proven within six or seven years."

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The 'studio' focuses on startups in artificial intelligence (AI) and deep tech. 'Two years ago, it was already clear at the start that AI would cause the next paradigm shift. We only target business applications. You can see that in our country it is difficult to develop large platform companies like Spotify or SalesForce, but those big players are keen on smaller applications that they can integrate into their offerings. Those can come from here.

Miles Ahead has already made four investments: in TalentGuide, an HR tool for internal mobility of workers, MyGamePlan, which analyzes football data and footage to coach players, Leadcamp, which makes sales processes smarter so that salespeople have more time for their core tasks, and Sealution, an AI platform for analyzing communication and data aboard ships. Within the studio, internal startups should also emerge from their own ideas, around which a team is built.

Investment Fund

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Miles Ahead aims to invest 35 million euros in Belgian AI startups over the next five years. The founders are contributing their own money to the fund, but the majority of the targeted 35 million euros must come from external investors. Many of the initial investors themselves have co-founded one or more tech companies: Jan Hollez, one of the two entrepreneurs behind the food tech company Deliverect (and previously Posios), Jan Van Hoecke (Ravn and iManage), and Ewout Meyns (Piesync, Hubspot). In a first closing, 6 million euros were raised, with another 6 million committed for the next closing.

Is it a good idea to establish a new tech fund now that investment interest in the world of tech startups has somewhat declined? According to Lebeer, portfolio manager at Miles Ahead, 'valuations have become more attractive after the recent market correction. There are also fewer competitors for almost as many new startups. Moreover, the studio approach should make it possible for investors who normally hesitate to venture into seed capital due to the risk to take that step and achieve a good return due to the higher success rate of the companies.'

The goal is to make four investments each year ranging from 500,000 to 600,000 euros, ultimately reaching 20 participations. 'That is a higher-than-average amount for seed capital,' says co-founder Luc Burgelman. 'We do this deliberately so that startup entrepreneurs don't have to worry about money for a good year and can focus on developing their business. Additionally, we provide up to 2 million euros in extra capital for a follow-up investment in a Series A capital round, as needed.

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(Tom Michielsen - 17 februari 2023 - De Tijd)