Investing in the Future with Thomas Davies, CIO of Seedrs

Investment is a tricky business, but there’s nobody more qualified to handle it than Thomas Davies. Using his experience as a globe-trotting lawyer, he’s helped investment startup Seedrs navigate and scale-up in the increasingly complicated world of Fintech. With a base in the most advanced market in the world, London, and his sights set firmly on the international horizon, Davies’ expertise in technological crowdfunding makes him a formidable example to follow.

Key Takeaways:

• See it from your employees’ perspective.There’s no better way to spot mistakes and see what needs to change than to work behind your employees’ desks for a day. Encourage them to talk about which problems need addressing and you’ll gain a better idea of what needs improvement.
• Know what you’re good at.Nobody is going to elevate you: you have to know what you’re good at and how to put yourself into a position that makes the most of your skill set. Equally, know what you’re bad at, so you can hire people who can do what you can’t.
• Offer something more than money.A good employee is a well rounded one. Give your workforce the chance to learn and build upon the experience that they already have.
• Create a framework for your team.People can only work autonomously if they have the right framework within which to do so. Make sure that your documents and software are cohesive and updated — this is how you scale a business.

Can you tell us a bit about your career journey so far? Can you also tell us about what you do and what Seedrs is?

I trained as a lawyer and began my career at Freshfields in London before moving to Hong Kong for two years to work for its Capital Markets team. I then worked in New York before deciding I’d had enough of law. I left in 2011 for Seedrs and the startup world.

Seedrs is a simple concept. Any company that is looking to raise money will submit its pitch to our platform. Once we’ve reviewed that pitch, we fact-check everything, and then we allow anyone to essentially invest and buy shares in that company through our portal. Seedrs holds, monitors and manages those shares on behalf of the investors, until hopefully the company is bought or IPO's on the stock market and provides a healthy return to the investors.

My own role within the company is Chief Investment Officer, which means that I head up the investment team whose role is to onboard and monitor business investments, and negotiate the legal documentation on behalf of our investors. What we do not only makes startup crowdfunding easier, but it also allows anybody to invest who wants to.

How has your legal background helped you in your various roles at Seedrs and what prompted you to switch out of law?

Legal training provides you with a very broad base of skills which are incredibly useful in the business world. I’m able to quickly digest and decipher large volumes of information, as well as analyse contracts and spot risk. My training taught me to show the results of my analysis in a very concise way. Negotiating terms on a daily basis in the world of law definitely helped to build my skills in that area.

Despite that, being a lawyer always involves taking somebody else’s great idea and executing the documentation for it — I always thought it looked more interesting on the other side of the table!

“I think the most important thing I’ve learned is the ability to get to grips with new concepts quickly — as a leader, you need to be able to review documents and make the corresponding commercial judgements very quickly.”

What skills have you acquired that help you in your day to day role?

The most important thing I’ve learnt is the ability to get to grips with new concepts quickly. We deal with a lot of companies who do very different things and are in very different legal situations. You have to make sure that Seedrs investors do not have a worse deal than any large-scale investors for a start-up company. You need to be able to review documents and make the corresponding commercial judgements very quickly.

At Freshfields there was a lot of pressure and you were constantly held to a high standard. Although we’re a relatively young company, I’ve tried to bring that attitude to Seedrs, and practice professionalism in everything we do.

What’s the best learning experience you’ve had?

When I worked in New York I had a boss who was renowned for being tough. I clearly remember attending a meeting as quite a senior member of staff at which I interrupted him to speak about something. After the meeting was over he came up to me and said “You mustn’t talk in the meeting — that’s my job.”

That was the moment in my life when I decided to leave law — while I’m a perfectly good lawyer, my strength lies in personal skills and communication. I found it ironic even then that I was in a situation where my strongest skillset was the one I was being told not to use. I learnt from that experience that you need to know what you’re good at.

“I always make sure that I hire people in team who can do stuff that I can’t, because there’s no point hiring people to do things you’re better at. My team is made up of people that I can’t live without.”

What does your role as CIO entail on a day to day basis?

Day-to-day life at a law firm is monotonous and made up of repetitive tasks that you often do on your own. I’ve found that my role at Seedrs is completely different — there is constant interaction with my team and clients. My day-to-day role here involves providing and tweaking the framework for my team to do what they need to do without daily oversight, along with long-term strategy and direction.

“I’m a big fan of giving people a lot of autonomy, but they can only do that if you give them the right directions and framework within which to operate.”

I think that any C-level person needs to be in tune with what the people in their company are doing on a day-to-day basis. Whenever I can, I hop into my employees’ roles for a day or so and do their documentation and deals. You suddenly realise what’s rubbish and what needs to be changed — I find it really effective and powerful.

What is the state of the Fintech industry?

In our industry, there are a lot of businesses that charge for access to another set of people. That’s the big city, old money approach where networking is key. What platforms like ours do is remove the barriers blocking introductions. We let people decide themselves how they want to collaborate, and help them structure that. In my view, this makes capital more effective and democratises the market.

However, we’re starting to see a lot of fragmentation in the market, which creates confusion. You also have aggregators popping up, which are a problem because they add cost without adding value — they get in the way of the customer.