Investor Circle

What Makes B2B SaaS Startups Irresistible to Investors

• Stewart Noakes • Season 2 • Episode 1

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Marwa shares her unique perspective as both a former founder and current investment analyst at Hatch VC, providing insider insights into what early-stage investors truly look for in B2B SaaS startups.

• Hatch VC backs B2B SaaS startups at SEIS and EIS stages, founded by successful entrepreneurs who've exited multiple businesses
• 72% of Hatch's portfolio companies successfully raise follow-on funding
• Three key criteria: founders solving deep pains, clearly defined customer personas, and experienced teams with industry knowledge
• Evidence trumps talk - successful founders provide proof of traction through signed contracts, POCs, and quantifiable metrics
• Multi-founder teams outperform solo founders who often struggle with burnout and lack of distributed responsibilities
• First-time founders should recognize investors back the person as much as the idea
• View investor meetings as learning opportunities, not just funding pitches
• Building the right community of advisors, co-founders and supporters is crucial for the entrepreneurial journey

If you're building a B2B SaaS startup and looking for investment, connect with Marwa at Hatch VC to explore how they partner with founders to scale from zero to over a million in ARR.


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Stewart Noakes:

Fantastic, All right. So welcome Marwa. It's absolutely wonderful to have you here today for this next new episode of Investor Circle. Thank you so much for joining.

Marwa Ebrahim:

Thanks, Stewart, it's really great to be here.

Stewart Noakes:

It's been incredibly refreshing to meet you and thank you so much for agreeing to be here and just kind of share a bit about your story today. Perhaps we could start, which is where we met, you know. Can you tell us a bit about Hatch and what you're doing there?

Marwa Ebrahim:

yeah, of course. So Hatch is an early stage VC that backs B2B SaaS startups in their SEIS and EIS rounds, so we look for ambitious founders who are experienced in their fields and who are solving a deep pain for a defined customer. I'm actually an investment analyst at Hatch, and Hatch was founded by successful entrepreneurs who have exited their own businesses several times before deciding to become investor, so what really sets us apart is that we partner closely with founders to help them scale from zero to over a million in ARR. We don't often require revenue to invest, and our goal is to be the supportive capital that helps a startup thrive, not just financially, but with real, hands-on guidance.

Stewart Noakes:

Fantastic, fantastic. Now, one of the reasons it was refreshing to meet you was when you told me about your backstory. So I wonder if you can share with people. I mean, my English phrase would be that you are a poacher turned gamekeeper. Tell people what your backstory is.

Marwa Ebrahim:

What a way to put it. But yeah, so before becoming an investment analyst I was actually a founder myself. I have been through the process of starting a company, bootstrapping it for years, doing a crowdfunding campaign and then finally raising an SEIS round, and I just find it really interesting that my first contact with Hatch was actually as a founder seeking investment and they had just invested in a competitor company. But throughout the whole process of just initially engaging with them and then meeting Charlie, the associate a few years later, they were always really open with feedback and it was clear that they made quick decisions. They had a very clean investment thesis and that's been my journey into this so far Started the company, raised the investment, grew the company for a few years, actually did that for five to six years before winding down and then joining Hatch as an investment analyst.

Stewart Noakes:

Where did you do your crowd race?

Marwa Ebrahim:

Oh, we did quite a few. Oh, we did quite a few. We did quite a few, and I think part of me being a founder before means that I know firsthand that things don't always go to plan, and so we did a first kickstarter campaign back in 2020, right as the pandemic was starting and we had everything lined up, all the all the media partners and the people who are going to share articles about the campaign itself, but it was.

Marwa Ebrahim:

It was a product campaign as opposed to an equity crowdfunding campaign. Um, and things just fell apart. Right as we were starting, lockdown happened. That was the main focus, as it should have been, and it was, for me personally, a point where I needed to accept that things had not gone to plan, but focus on still getting the product to market and getting those early backers into the business, even though the crowdfunder or the Kickstarter never worked out. So good learning experience.

Stewart Noakes:

Yeah, fantastic, fantastic. And you, I think, if I remember rightly, you raced your SEIS round with SFC, was that right?

Marwa Ebrahim:

I did yes.

Stewart Noakes:

So very different to Hatch right. Is there any particular thing you'd highlight? That's the distinct difference between Hatch and SFC.

Marwa Ebrahim:

SFC were great investors and I was really great. I was grateful to have them with me on that journey and I think for any founders listening to this, I'd say look for that. Look for investors who will help you in your journey. I think one of the things that sets Hatch apart is the fact that the founders of Hatch are actually successful entrepreneurs and I think it's about 72% of our portfolio companies go on to raise second rounds.

Stewart Noakes:

Well, it's incredibly high stats.

Marwa Ebrahim:

It's amazing it is and I think that's a testament to the quality of the support that we offer and just it can vary from company to company. There's no specific playbook, but we're really good at helping founders get from that zero revenue initially to a million arr and putting the infrastructure in place to get to 10 million ARR.

Stewart Noakes:

Okay, okay, fantastic. Well, obviously we've met each other through a particular fundraising journey and I guess, as the goal of Investor Circle is empathy or, as my favorite word in Portuguese, empatia, you know it will be really helpful at this point is if you could share, like, how does your brain look at things that cross your table for investment? Like, how do you throw things away? How do you take things into the pile and say, yeah, this is worth it? Can you share without giving away like the entire secret source of how you do stuff? But like, how do you look at these things when they arrive?

Marwa Ebrahim:

Yeah for sure. So, like I said, we invest in B2B SaaS businesses and we look for three main things. The first is founders who are solving a deep pain in the present and we define a deep pain almost like the thing that keeps you up at night at 3am. You're unable to sleep until you solve the problem.

Stewart Noakes:

Oh yeah, this 3am staring at the ceiling thing, right, okay, yes, or like a stone in your shoe.

Marwa Ebrahim:

Every step that you take it's bugging you. You cannot think of anything else until you get the stone out of your shoe. So that's the first thing we look for founders who are solving deep pains in the present. The second is we look for defined customer personas. So if you've created a product and it is solving a pain, the next question is do you know who is experiencing the pain? Do you know how to target the right companies and who the companies are? But then a step beyond that is the buyer, the user and the budget holder within the company you're targeting might not necessarily be the same person, and so do you understand who these different stakeholders are and who you should be approaching? So if you're telling us that you've created a product for the financial services industry but your actual clients are schools, for example, then that'll raise questions about whether you know who your target customer is and whether you're actually addressing a deep pain. If your customer is not who you're saying the deep pain, you're not. If your customer is not the same persona who's experiencing the deep pain, that makes sense.

Marwa Ebrahim:

The third thing we look for is experienced teams, so founders who understand the industry or the problem. Maybe they've been in this industry for a long time, maybe they've experienced the problem themselves. But this is really key and Charlie, our associate at at Hatch, has a really great TikTok post about this where he delves further into it. I think ultimately we back people who can adapt, learn and execute. It's not just about the idea. It's about the founder's ability to make it happen going.

Stewart Noakes:

There's like several threads. I want to go with this one and I'm not quite sure which one to do first, but I think it's the pain thing right. So pain versus gain, how do you differentiate between those two? And why is it the pain that hatch is so fixated on? You know somebody's enriching somebody's life. If they're amplifying the plus side, why is that not as much of an incentive as the pain solving a pain problem?

Marwa Ebrahim:

so it can be. Either it can be that you're solving a deep pain in the present or you might be creating a 10x opportunity. The key thing for us is to see that what you're trying to do is a need to have, not a nice to have, and the reason we look at the present in particular is because those problems that you have right now tend to. If I'm trying to sell you a solution for a problem you currently have, then this will resonate with you emotionally better. So the best way to show that you're solving a deep pain is to tie your solution to a metric that's important within the company. It could be revenue, for example. Does your product improve their revenue? Does it save them money, and if it does, then how much? We like founders to be able to quantify the amount and, as investors, that helps us gauge that, yes, there is demand for this.

Stewart Noakes:

Okay, super cool, super cool. And you mentioned team, right. So if I just offer up what we talk about in Canopy and see how this fits with what you look for, you mentioned team, right. So if I just offer up what we talk about in Canopy and see how this fits with what you look for in the team, right. So we talk about three roles inside a founding team.

Stewart Noakes:

We don't like solo founders, we like two or more people, particularly three roles. One of the reasons we like three is because there's an imbalance. You can't have a stalemate in three. You have to make a decision and we have three main roles which is a visionary, an order filler and a technologist, and we find that the tension between the three of those really helps scale up a company. So we offer that template up to every company that's coming through virtual incubation and we say, right, let's look at your team. How are you exemplifying these three roles? Are you internally compromising? How are you really driving that up? And that's kind of part of our secret source. But how does that compare to what you're looking for in a team? And you know, would you even contradict that and say you know, that's not what we're looking for at all. We're looking for yeah.

Marwa Ebrahim:

I think, when I hear what you're saying about the three founder teams, from a ex-founder perspective, that would have been so useful for me. From an investor perspective, it's really reassuring to know that there are multiple people within the team, that they all understand the problem and they have clearly defined roles within the company. But, like I said, as a founder, doing it on your own is really difficult. But, like I said, as a founder, doing it on your own is really difficult and it's actually one of the things I wish I had done something about more actively. So it's great to see that this is part of the accelerator program so early on.

Stewart Noakes:

Yeah, I mean it's massive right, and one of the things that we've seen is that solo founders and I've been a solo founder several times, but solo founder are the highest failure group and part of that is literally that you run out of steam or you get sick or something really throws you off your game and that if you're just a solo founder, the only energy that's driving it is yours. So if something knocks that energy away, then the whole thing starts to crumble, whereas if it's three of you and somebody goes sick, well, there's still two people driving it. There's still a combined force happening. One of the other investors we interviewed he just likes supply and demand. He likes two people back to back. One deals with the outward face, one deals with the inward face and it's their coordinated effort that really creates the company. You know everybody's got we call it a cheese and wine palette right really creates the company. You know everybody's got we call it a cheese and wine palette right. Every investor's got a different cheese and wine palette different taste for these things, totally.

Stewart Noakes:

All right. So tell me then, what's the secret Marwa source? What does your brain do with these things that nobody else really does Like when you're getting to that point where, as an investment analyst, you said, yeah, this one's for investment committee, I'm putting it forward and they can see on your face that you totally want this one to win right. What's happened there? What's the secret bit that happens for you?

Marwa Ebrahim:

I think for me, obviously, they'd have to meet all the criteria I mentioned before. It has to be B2B SaaS solving a deep pain, multi-founder experience, teams who know their ideal customer profile. I think the differentiator between companies becomes how much proof so? How much better are they than everyone else that we're seeing In terms of the pain? What are the proof points that they can share to prove that they're actually addressing a deep pain? Is it revenue? Is it signed contracts? Is it POCs that are in progress? Is it an MVP?

Stewart Noakes:

Evidence right, Evidence rather than talk.

Marwa Ebrahim:

Yes, that's where you're going with it Okay interesting.

Marwa Ebrahim:

Exactly. I think the evidence is really what takes it from the hypothetical idea stage to this is a real problem with a team that can really execute. So it's the same with the team Evidence that they can sell, evidence that they come across well, can communicate the problem, articulate why it's important, quantify the pain itself and maybe how much money or time it's costing their clients. And evidence that, if they have, say, a go-to-market strategy in place, evidence that they can execute on that and maybe proof that they've already started to do so.

Stewart Noakes:

Okay, you mentioned before that, like I think it's, do you say? 72% of the companies have gone on to do another round after this. So what does Hatch do to help with that stuff? Is there an EIS fund? Is there something else that follows on, or is there a handshake to other firms, that sort of look to Hatch for signals, or is there anything you can share around that?

Marwa Ebrahim:

Yeah, so Hatch invests at both the SEIS and the EIS stage, and tickets for SEIS tend to be around 335k and EIS it's between 300 to 500k and we can lead and follow. So a portion of our EIS fund is reserved for the high performing SEIS companies and it's, I think, both as a founder and investor. It's really great to be part of a company like Hatch that supports founders not just financially, but with hands-on experience that's held within the team as well.

Stewart Noakes:

Okay, fantastic. And are there any other funds that kind of orbit Hatch and say, well, like you're so good at B2B SaaS that whenever something comes through your SEIS platform, we're just going to go and put some money in as well, or is that something that hasn't happened yet?

Marwa Ebrahim:

So Hatch has a lot of ongoing relationships with the different funds in the UK and abroad and we do co-invest with a lot of them as well.

Stewart Noakes:

Okay, fantastic. Well, you're a bit of an inspiration for me. I've got to be honest. I've really enjoyed the approach that you've taken to some of our discussions we've had, and I wonder if you've got anything that you would share with a first-time founder who's watching this, because a lot of Canopy's community is first-time founders raising money for the first time and like what's your best advice as poacher, gamekeeper, whatever your role is, what do you want to tell them?

Marwa Ebrahim:

I would say that at the early stage, in pre-seed and seed Investors are often backing you as much as they're backing your idea. So be cognizant of how you come across when you're talking to investors. Be authentic, show passion and communicate your vision clearly. Sometimes the investor you're speaking to might not be the best fit for you. So I'd say, definitely do your homework and research on the investors themselves. They're choosing you, but you also need to choose them. I think another thing I'd say is know the pain that you solve for your customer and be very, very specific when you talk about it. And last thing, from my founder experience just build the right community. That can mean advisors, board members, co-founders, people who are rooting for you to succeed. Doing this on your own is a difficult and lonely journey. I mean it's difficult either way, right, whether you have people around you or not. It's a long journey, but if you're resilient, you focus on improving and learning, the right advisors and investors will be drawn to your commitment.

Stewart Noakes:

Amazing.

Marwa Ebrahim:

I realize you've been asking all the questions, but I'd really like to know is what do founders struggle with the most when they are raising investment and when they come to you for advice at Canopy?

Stewart Noakes:

There's a lot of stuff in there. It's a really good question. Thank you for turning it around. I love it.

Stewart Noakes:

Probably one of the hardest things that's really persistent is the co-founder thing, and it's sometimes I mean a lot of times it's they don't have a co-founder, so they are a solo founder and they're looking to raise money and they they either know or feel that they should have somebody else in the mix, and we're obviously counseling them to do the same. And then the question is like where do I get that from? How do I trust that person? How do I then go with that person to the investment committees and so on and look genuine, like we're actually a team, because you can't just be a team in name, you've got to be a team team when you arrive, right. So and the timing on that stuff is really hard, finding those people is really hard, finding everybody with the right life journey to actually commit into something properly. And an investor will look at that and say, well, you know if you've got 18 months or three years in you, because if you can't survive 18 months, at least when I put this money, and then you know what am I really investing in. So that's, that's a really key bit.

Stewart Noakes:

A lot of the people that have done first talk or doing fundraising for the first time just don't even know or don't recognize at the start that it's a process, there are steps to it and, um, they take a lot of the things personally. Right, and to a point that you mentioned before, one of the things we try and encourage a lot which is a real mindset shift for people in the main is every investment discussion is a learning opportunity. So something I counsel and I'll sort of say in my crudest terms, even though it's an investor circle thing and a few investors may listen to this I did this on the Masters as well as in the Canopy stuff. I know a lot of investors, some of whom, to be honest, are assholes. Right, there's a real ego in there, but every single investor I've ever met who's ever done more than one investment has the wisdom they have a wisdom which, if you are lucky enough to be in the room and you get to ask them questions, a wisdom you can can benefit from because they've seen more things than probably you or I will ever see one of you, because you're seeing things all the time, but you know, as a founder, they've seen more things than you that look like you, that sound like you.

Stewart Noakes:

They're trying to do what you're doing and if you ask the right questions in that room, you can learn so much and you can see that the first time founders looking at me like I'm insane. Right, you know, this is a competition. I've got to win, I've got to get the money and it's like no to your point. Again, you're picking them and they're picking you, so you've got to get past that. But even if you don't get the money, you can come with a gift from each meeting and the gift is a wisdom that you couldn't have got to yourself. Until you get to hindsight and at the end of your journey, you look back and go, wow, but these guys have these investors, they've all got this already, so go and find that, go and use that opportunity to your benefit.

Stewart Noakes:

Um, and we do cancel that a lot, and the masters in particular. Like you know, we're doing this on an msc. Part of what we do in the assessments is a pre-seed pitch and a product demo and we encourage them and we even grade them on how they prepare to ask questions and to run towards the question. You know some people are scared. Right, they go in front of an investor and like, oh my god, they're asking me questions like no, no, run towards the question. The question is a really healthy thing. The question means they actually care enough to want to spend even more time with you and actually find an answer. Run towards it, smile like the shoulders should open up and you'd be like, wow, thank you so much for this question that is great advice hey.

Stewart Noakes:

So what's next for you? What's next for hatch? What's, what's the next?

Marwa Ebrahim:

kind of 6 to 12 months, look like next for me is I'm always on the lookout for great founders building in the b2b sass space and I'd love any intros to any great founders who you know who could be raising soon, I think. From a personal perspective, I have experienced the pitfalls and the like struggles of fundraising as a founder and one of the one of the things I struggled with the most, I'd say, is receiving no's from investors who are early stage investors but who tell you you're too early stage and just as a founder, sitting there wondering what early stage even means. And part of me joining Hatch was to get a better understanding of that investor perspective and I'd very much like to share that with people, share that with founders, specifically shedding light on what investors look for or specifically what we look for, what early stage means. When we do say it that I had a lot of help building my business for years and I'd like the opportunity to just help out others as well in any small way that I can.

Stewart Noakes:

Fantastic. Thanks for that. Well, and I really appreciate you asking me a question today. Thank you for turning that one around in the middle. Appreciate it For me. It's been brilliant to meet you and I really wish that we could get you along to a demo night. I know Glasgow is a long way from London and I almost feel like I should move demo nights location just so they can bring you in as a panelist. But if you happen to be coming to London or Lisbon or Cornwall and you want to be on a panel and you want to come and meet the demos, it will be fabulous to have you there at some point.

Marwa Ebrahim:

Thank you so much for doing today. Thank you so much, thank you.

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Stewart Noakes

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Marwa Ebrahim

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