Thesis driven
Cyril Bertrand

Investing for the 99%: in Brands We Trust [2/3]

Polarization is everywhere, and it’s not a good news. Winners and losers emerging from the Covid sanitary crisis, economical divide between generations (boomers vs. genZ), political radicalization in many countries all over the world. Those rich enough to buy assets and educated enough to understand leverage reaped benefits from Quantitative Easings, others drifted to poverty.

In startup land, lock-downs generated opportunities for home-workers and digital industries while overexposed essential field workers were left behind. Prospects of a “K-shaped” recovery were mostly favorable to startups while non-digital industries suffered massive losses. The tech haves and have-nots are now worlds apart.

We can do much better than that: XAnge focuses on making tech accessible to the largest possible audience. As an investor, we have the ability to direct streams of money towards a new breed of brands, not the Coca Cola and Pampers of the XXst century. We need Brands people can trust and relate to. We’ll support founders who genuinely strive for everyone to benefit — not just a certain segment — from new brands powered by technology.

We firmly believe that unequal access to tech, to the right products & services is the issue to solve. Democratizing tech is the best means of empowerment for all groups and individuals — if not the only one.

Brands are frequently mentioned in the context of entertainment & lifestyle. Brands like Netflix, ParisSaintGermain, Disney or are pretty good at what they do. Nothing against them, we love them.

But we think Brands have a more central and vital role to play: there will be brands for professional tools, brands that redefine finance, brands that teach about foods, give individuals the control over their own health, enable more diverse education styles, bring safer mobility.

At the core of the most fundamental human needs, we see a noble role for brands, those who have the integrity to build a trust engine, a deep bond between the user and their provider.

We believe we’ll see the best brands make more promises and hold those promises.

It takes years to create trust, and it takes seconds to destroy it. Not many brands will be up to the challenge, and those who succeed will be supported by sincere, relentless, passionate founders. They will empower people to build the life they want.

Trust is the key ingredient behind every successful brand and has the power to be an antidote to polarization. Great brands inspire a sense of community, a common basis of shared values.

It’s no surprise that the fastest growing tech brands are also the most trusted. How else would they transcend class, income & gender to permeate society all the way to its most specific groups? Some of them are already here under our eyes : think of Lydia or BackMarket in France. The same goes for B2B brands: Doctolib or Alan are well on their way to become the trusted references we need in their respective segments.

Assessing a brand’s potential for trust requires to take a closer look at recurrencequality and culture. The best brands build on all of those three ingredients and their mutual potentiating effects.

1.RECURRENCE refers to frequency of touch points between the brand and user. Is it daily, monthly or more? People use Swile every day. Ouihelp has daily interactions with the end customer (the elderly person). Above a certain level of recurrence, the user understands and endorses a subscription model, a cash flow which materializes the continuous stream of benefits received from the provider. In contrast, when was the last time you met your real-estate agent? When is the next time you’re due to meet your car dealer? Trust needs presence, a recurring presence.


2.QUALITY of product & interactions is essential. A lot of interactions (recurrence) mean nothing if those interactions are negligent or superficial. How to deliver quality in the digital age? We like to start with a sleek interface, the kind that keeps things simple, focus on the user’s needs and learn the user’s preferences. Think NetflixShine, and the good old version of Trainline. We want obsessive design, outstanding ergonomy and fast product improvement/development cycles — even in service companies (fintech, mobility, travel etc.) where no “product” is sold.


3.CULTURE is even more crucial as brands reach for mainstream audiences: that’s where the best of the best compete. Trust is built by treating your customers as you treat your employees, by showcasing (and living up to) the same brand’s values externally as internally. Here is a common denominator of many high-trust brands: the border between the outside and the inside of the company is not heavily guarded. This demands sincerity, and making sure the brand’s message is aligned with its behaviour. Odoo’s thing is openness and transparency: their compensation grid is as public as their open-source code. A freelance customer of Shine calls the customer service and lands on an employee who .. is also a freelancer and delivers advice from a freelancer to a freelancer. By the way, this is not a matter of being only ‘kind and gentle’, but consistent: Doctolib’ culture is sharp & efficient — a promise that holds true among customers.


To sum it up, XAnge’s analytical approach to Trust is this: we look for frequent interactions with customers, each interaction striving for a measurable top quality but also giving a glimpse of how the brand works inside.

1.FINTECHS & CRYPTOS. Taking a closer look at Ledger, there’s no doubt that trust (i.e. securing the crypto assets of a population widely composed of developers) was fundamental to its success. In this field trust makes all the difference — possibly even more than the tech itself. It will be up to the next generation of finance tools to do better than their predecessors if they want to bring something extra to the table.


2.MOBILITY. Whether their business model is based on sharing bikes, automobiles or public transport, brands will succeed by bringing fluidity and new options to their users — individuals & corporations. One of the sector’s most brilliant successes is Flixbus, the brand that hundreds of millions of users rely on for inter-city travels. The company never promised more than they can deliver, a service consistent with their culture: reliable, practical, and unbeatable on pricing


3.FOOD. Our eyes are focused on the deeper layers of the industry, as we search for solutions with the potential to impact entire sectors. Think growth factors, which allow to grow meat without harming animals, or dark-kitchens, which allow to maximise the use of sleeping assets. Agricool and Infarm are examples of a solution enabling a revolution in their industry, in this case urban farming.


4.EDUCATION. There was a time when people learnt straight for 20 years before spending the rest of their lives working and never going back to school. With companies like 360Learning, these times are over. Given the opportunity to learn as they go, people will radically change careers several times in their lives if they want or need to. This too, is empowerment.

Silver economy, New media, Fair commerce, Cybersecurity… There are so many more sectors we can think of, where strong and trusted brands could make a difference for everyone.

Our job is to enable them.

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