In this edition of Cosmic Conversations, I sat down with Richard Harley, Ventures Director at Blackfinch Ventures. He helps oversee a portfolio of 40+ companies and invests alongside the deal team, typically backing businesses up to pre-Series A with cheques from £500k to £2m. 

Richard works with founders on the realities after the round. Fundraising, hiring, sometimes firing, and the day-to-day choices that shape early traction. 

You can watch the full conversion above or take in the best bits in the short summary of Q&As below. 

Q: What stages does Blackfinch back? 

Blackfinch invests up to pre-Series A with investments between £500k and £2m. We are sector-agnostic across software and deep tech. We usually avoid pre-seed unless it is deep tech with clear technical readiness.  

Once the deal team completes an investment, the company moves into the portfolio where my team helps on hiring, fundraising, and the operational challenges that come with growth. 

Q: What makes a founding team stand out at this stage? 

There is no single trait. I look for people who are genuinely close to the problem and ready for a multi-year journey. Sector expertise helps, but it is not required.  

What matters is clear insight into the pain and a willingness to build for five to ten years. Team shape also counts. A strong technical lead paired with a strong commercial lead beats a lone academic profile trying to learn sales from scratch. 

Q: What traction moves a deal forward? 

At Blackfinch’s entry point, we look for evidence of repeatable revenue rather than signals alone. That can be low hundreds of thousands in annualised revenue with healthy gross margins, early signs of retention, and a founder who understands the first twenty customers in detail.  

We rarely invest pre-revenue outside deep tech. For context, a UK Series A today often needs £2m to £3m ARR, which is a step beyond Blackfinch’s typical entry. 

Q: How do you asses AI value? 

AI is everywhere, and I expect teams to use it. The edge comes from applying current tools to a problem and layering unique data or workflow on top. Building new foundation models is hard for most UK startups unless they are academic spin-outs.  

The more compelling stories are productised applications of AI in areas like sales tooling or financial data analysis where the tech drives faster, better outcomes. 

Q: What are the most common post-raise mistakes? 

Two stand out, first is hiring a head of sales too early. Up to roughly £1m ARR, founder-led sales wins. If you do hire, write down the six-month outcomes you expect, check progress at three months, and pull the rip cord if they are not on track. The hidden cost is time, missed revenue, and momentum.  

Second, hosting costs. If you ignore them, they scale faster than revenue. Put the right expertise in early to avoid an expensive surprise. 

Q: Profitability vs growth, does it matter at Seed and pre-A? 

Not for Blackfinch. If you are profitable and growing fast at this stage, I would question whether you need venture money at all. The focus is on building a repeatable engine with strong margins and retention, not near-term profitability. 

Key takeaways 

• Founder-led sales usually beats an early senior hire up to around £1m ARR. 

• Treat AI as an accelerator for problems. 

• Show repeatable revenue, healthy gross margins, and early retention signals. 

• Deep tech can be earlier but demonstrate real technical readiness. 

• Write six-month outcomes for senior hires and review at three months. 

• Watch hosting costs from day one. 

• Series A expectations in the UK are closer to £2m–£3m ARR today. 

If you enjoyed this conversation with Richard, check out our other recent Cosmic Conversations with leading VCs. 

Connect with Richard Harley on LinkedIn and find out more about Blackfinch Ventures.