Think at London Business School
Friday 12 February 2021
New research shows early-stage startup founders are more likely to get investment if they pitch on a sunny day
By Gary Dushnitsky, Sayan Sarkar
Luisa Alemany’s route to academia was not typical. She dropped out of high school at 13 to work as an apprentice in the aircraft industry. A few years later, while still working in the factory, she studied in the evenings to finish high school, then got a degree in economics and business. Next came work for the likes of Procter & Gamble, McKinsey and Goldman Sachs. Then there were jobs in venture capital, during the dotcom boom, and later in private equity.
It is perhaps no surprise that, despite having taught in business schools for almost 20 years, Alemany – now Associate Professor of Management Practice at London Business School (LBS) and Academic Director of the LBS Institute of Innovation and Entrepreneurship – still thinks of herself as an entrepreneur at heart.
“Being entrepreneurial is not necessarily starting a business, it’s about having an entrepreneurial mindset,” she says. “I’m an academic, but I’m launching new initiatives and innovating. I’m also an entrepreneur.”
Professor Alemany is a relatively new addition to the LBS team, having taken up her post in October last year. Her goal is to pull together the different elements of entrepreneurship teaching and research at the school, using her experience in both academia and business.
“Coming to LBS is like joining the Champions League,” she enthuses. “Entrepreneurship at LBS has a long history. It started as a way of supporting those students interested in launching their own businesses and has grown to a great portfolio of courses and research in the topic. This gives us the foundation to dream big! London is the entrepreneurship hub of Europe and I’m so excited about all that can be done.
“And it’s not only on the startup scene – I started by reviewing everything entrepreneurship-related that LBS has. Now that I’m ready for the leap forward, just watch this space!”
A native of Getafe, an industrial town just outside Madrid, Alemany first moved to the UK in 2018 to take up a visiting professorship at Saïd Business School, Oxford and, since her family fell in love with Oxford, has made it her home (she is also a fellow of St Hugh’s College, Oxford). Prior to the UK move, she was Associate Professor and Director of the Esade Entrepreneurship Institute in Barcelona.
Throughout all of these roles, Alemany has been interested in risk and investors who are prepared to take it. Her work has also looked at the new breed of investor who is keen to use their money to solve social problems, rather than just seeking financial return. “Research usually comes from something you find fascinating and, for me, it was my time working in venture capital and private equity, being an investor,” Alemany says.
“In 2007, I started looking at philanthropic venture capital – a subset of what would now be called impact investing. There wasn’t much research into the field at the time, but more people were saying if we can create huge companies with great value added through good teams of entrepreneurs and venture capital, why don’t we apply that approach to social problems? Let’s apply venture capital to philanthropy. I started by looking at the difference between the traditional venture capital market and this new philanthropic venture capital.”
This focus on impact investing has formed the basis of new research Professor Alemany is undertaking at LBS into the motivation of investors in social enterprises and what makes them prepared to take a lot of risk without financial return as a potential reward.
Initial findings have been surprising. Investors with commercial, financial or consulting backgrounds appear less likely to make high-risk investments in social ventures. Those with backgrounds in the social sector (notably, teams with larger numbers of women) seem more willing to take risks when investing money.
“I’m researching the influence of gender and human capital on the risk profile of investors in venture philanthropy and we’ve had some unexpected results,” Alemany explains. “Our hypothesis was that people coming from a background in venture capital, private equity or investment banking would probably be prepared to take more risk when investing in social enterprises and those from the social sector would be more risk-averse. But the opposite appears to be true. Then we started to look at the findings in terms of gender and found that teams with a higher proportion of women take more risk, too.”
“Why is this? We’re not sure and we’re still working on it, but there are some theories we’re exploring,” she continues. “If you subscribe to the idea of women being more nurturing and inclined to take care of people, perhaps they see a greater social return, reaching more people in need, by taking more risk when investing in social enterprises.
“Conversely, it could be that those men coming from a commercial background don’t want to take risks because they perceive that working in the social sector means doing good and not taking risk when the human stakes are high. We’re looking at some theories from psychology, such as gender-role incongruity – in this case, affecting both women and men – to try to understand the findings. The implications for social entrepreneurs looking to get investment are very interesting.”
Professor Alemany’s energy is infectious and her drive undeniable, as evinced by her remarkably varied career history. During her apprentice at the aircraft factory, and while her peers were thinking
about the usual teenage pursuits, she completed her high-school diploma in the evenings, then took a degree in economics and business. But it was winning a scholarship to study for an MBA at Stanford Graduate School of Business that took her to the next stage of her professional life.
While working as a financial analyst at Procter & Gamble, she started her PhD on the impact of venture-backed companies in the economy. Next, she worked successively at McKinsey as a business analyst, in the investment banking division of Goldman Sachs, then private equity with The Carlyle Group and venture capital at the Bernard Arnault-backed fund Europ@Web, experiences that haveinformed her academic work since.
“Private equity was very alluring,” she confides, “but I like to be with entrepreneurs. In venture capital, I worked all the time with these incredible people who had the drive and the ideas – really innovative individuals. That’s what I really enjoy.
“At the beginning of October  we launched a new initiative with top VC firm LocalGlobe, the Newton Venture Program. It’s been amazing to work on this with my LBS colleagues Julian Birkinshaw and Jeff Skinner since I arrived a year ago. We will be training the new generation of venture capitalists but, most importantly, promoting diversity and opening up the sector. And this is just the beginning.”
It was when Professor Alemany was living in Barcelona, completing her PhD while on a sabbatical, that she was asked to teach part-time at Esade Business School. Little did she realise that this would lead to a total change of career – and eventually to running an institute for entrepreneurs.
“I never looked for a job in academia,” she muses. “I got the job at Esade in Barcelona because I was there on the spot. I didn’t have a clue about teaching. I was very, very interested in venture capital, the topic of my PhD, and, of course, I was used to talking in front of people, doing presentations as a consultant and such. But I hadn’t considered teaching and found that I really liked it.
“You’re always with people who, even if they have different ages – I do a lot of executive education – are young and inquisitive in spirit. They’re willing to put in the effort to learn new things and you’re forced to learn and stretch yourself, too. Things are always moving, especially in the field of entrepreneurship. It’s a great opportunity to learn.”
“When I finished my PhD, I was happy to try something different. I still have some involvement as an early-stage investor. I’m a business angel and invest in startups. I like that I still get to have those relationships with founders and help them along.”
Taking risks does not just extend to Alemany’s professional life. One of her passions is scuba diving, with a particular love being swimming with sharks, which she travels the world to pursue. Another ambition is to join a NASA expedition to Mars. She says: “I’m a risk-taker. I love it. I don’t see risk as negative, but something positive, as I explain in class. I’m very financial and always think more risk, more return. Of course, taking risks means things can go wrong, but the more you risk, the more things can go right, the more you can gain.”
Her love of education is not limited to expanding the minds of graduates and executives. She is passionate about teaching entrepreneurship to young children, nurturing creativity, innovative thinking and resilience from a very early age. In Spain she is involved in the Princess Girona Foundation, a project that helps teachers in schools develop entrepreneurial skills in children from the age of four up to university.
She explains: “Having an entrepreneurial mindset isn’t just about starting companies. It’s about being equipped to handle life’s challenges. You can be entrepreneurial in politics, medicine
or teaching. We’re all born entrepreneurs. Kids will do anything. They’re not scared because they only see opportunities, but, as they go through school, we quash that spirit and make them into more cautious, serious, boring people.
“I want to see education from an early age promoting that entrepreneurial attitude and nurturing that optimism and innovation, which can then be applied to all areas of life. “At LBS we are in a unique position as we are a learning hub for early, mid and senior career students. We combine top research on relevant topics for the business world with an amazing pedagogical capacity. This is why building the entrepreneurial mindset as a way of approaching the challenges of the world will equip our graduates for life – and have a positive impact on the planet!”
Given a career that has taken so many extraordinary turns, how much has been planned and how much has been down to chance? She confesses: “I’ve never really thought about that before.
Instinctively, I would have said that I planned my life, but I’m realising that I’ve not planned many of the things I’ve done. I didn’t plan to work at LBS. I came to Oxford for three months during a sabbatical from my previous business school, which then became six months, and here I am. When I was younger, I didn’t see myself teaching at all. I would say I’ve been fortunate with the opportunities that have come my way.
“But the important thing is to give it a try. I’m not scared of failure. If something doesn’t work, it’s not a big deal. I can always go back and do what I was doing before or do something completely different. Either way, I’ll learn something valuable along the way.”
Luisa Alemany is Associate Professor of Management Practice in Strategy & Entrepreneurship and the Academic Director of the Institute of Innovation and Entrepreneurship and The Financing Entrepreneurial Business programme at LBS.
Think at London Business School
A tiny fraction of investment in new ventures in the US and UK is allocated to Black founders. Here’s what needs to change
By Jo Hamya
Think at London Business School
Serial investor and Lovefilm co-founder Saul Klein says VC firms are sitting on 'unprecedented' amounts of cash and are keen to invest
By London Business School