Evolution of the Angel Group

Presented at the NACO Angel Summit October 2nd, 2014

Some background on the Full Stack model and open questions around the evolution of the angel group.

Transcript

1. FULL STACK • http://fullstack.ca • #NACOSummit Evolution of the Angel Group Quebec City, October 2014 Boris Mann, Managing Partner, Full Stack Boris Mann @bmann • October 2014
2. FULL STACK • http://fullstack.ca • #NACOSummit Full Stack • An angel investment firm, founded January 2013 • Full Stack invests in early-stage web tech companies • Based in Vancouver, BC • 9 investments during our Prototype (to July 2014), typical check size of $150K - $250K • Lance Tracey & Boris Mann Boris Mann @bmann • October 2014
3. FULL STACK • http://fullstack.ca • #NACOSummit What is an angel group? • Co-investment? • Shared deal sourcing? • Shared due diligence? • A non-profit? • A for-profit investment vehicle? Boris Mann @bmann • October 2014
4. FULL STACK • http://fullstack.ca • #NACOSummit Evolution • Access to information: founders & funders • The distributed angel group • Death of backyard only investing? • Tech & tooling • Prototype learnings • New Mistakes Boris Mann @bmann • October 2014
5. FULL STACK • http://fullstack.ca • #NACOSummit Access to info: Founders & Funders • Entrepreneurs all read the same Internet. Unfortunately, much of the Internet is American. • Finding and connecting with investors who publish their portfolio and their interests - platforms, social media, blogging, etc. (and vice versa in investors finding founders) • We need more standard information that is well- suited to Canada – with an understanding that we are already in a global marketplace Boris Mann @bmann • October 2014
6. FULL STACK • http://fullstack.ca • #NACOSummit The Distributed Angel Group • I help manage the Maple Syrup Mafia mailing list • Why does a “Group” have to meet physically in person? • Dealflow, Discussion, Co-investment, etc. can all be done online • The platform play: AngelList, Gust, FundersClub, CircleUp, etc. • NACO as platform? Boris Mann @bmann • October 2014
7. FULL STACK • http://fullstack.ca • #NACOSummit Death of backyard investing? • Is the best deal in your backyard, geographically speaking? Or is it merely the best deal you can get into? • If your backyard is the Internet, what are your limits on deal sourcing? • How does reputation scale when it is no longer local? Boris Mann @bmann • October 2014
8. FULL STACK • http://fullstack.ca • #NACOSummit Tech & tooling • Built our own use of proceeds / budget app, Budgie budgetsheet.co • Using Pipedrive, a CRM with a great API, for deal sourcing & portfolio investor funnel • Portfolio management / metric tools - Hockeystick.co, Visible.vc, compass.co • Online captables: Captable.io • Must-have tools: Xero, Intercom, Tapstream • More: fullstack.ca/tools Boris Mann @bmann • October 2014
9. FULL STACK • http://fullstack.ca • #NACOSummit Prototype learnings • Deals that we didn’t lead were messy, took longer, and were more expensive • Finding co-investors is tough • Focus on value-add and advice, not being the biggest cheque • Connect with community, unlock local co-investors Boris Mann @bmann • October 2014
10. FULL STACK • http://fullstack.ca • #NACOSummit New Mistakes • Syndicates • The Foundry / Venture Studio Model • Distributed Angel Group - Open Angel Canada http://www.openangel.ca • “Future of Venture” - unbundling of advice, money, and control Boris Mann @bmann • October 2014
11. FULL STACK • http://fullstack.ca • #NACOSummit Thanks! fullstack.ca/tools fullstack.ca/news @bmann • @FullStackDotCa angel.co/borismann angel.co/fullstackventures Boris Mann @bmann • October 2014
12. – Naval Ravikant, Co-Founder AngelList @naval “ We are also seeing the emergence of Seed Combinators and Pure Money plays. Y Combinator, TechStars, I/O Ventures, AngelPad, Founder Institute, etc., are basically giving advice – if you’re going there for the funding, then you’re not doing the math. DST and later stage funds are pure sources of money.”
13. – Naval Ravikant, Co-Founder AngelList @naval http://bit.ly/navalunbundling “Venture Capital, at the time, was a bundle of three things – Advice, Control, and Money.”
14. – Naval Ravikant, Co-Founder AngelList @naval http://bit.ly/navalunbundling “Angels are investors who leave out the control. They essentially bundle just Advice and Money.”
15. FULL STACK • http://fullstack.ca • #NACOSummit Unbundling of the Venture Asset Class • Dave Lerner, November 2013, http://bit.ly/vcunbundling • 1: VC Bloggers, The Funded: Entrepreneurs were no longer in the dark and suddenly knew what the game was. Few before them had ever known. • 2: SuperAngels / Micro VC: The meme of founder-friendly investors (often entrepreneurs themselves) emerged, open discussions, open personalities, no board seats, friendly terms, convertible notes + standard term sheet models • 3: VC as Service-Provider, the emergence of AngelList, Secondary Markets, Accelerators: First Round Capital, Andreesen Horowitz do “Fat VC”, JOBS act, secondaries, accelerators unbundle advice • 4: Data & algorithms for deal sourcing & analysis: Mattermark, Datafox, Disruption Corporation Boris Mann @bmann • October 2014
16. FULL STACK • http://fullstack.ca • #NACOSummit Panel Questions • Your angel model (Where does your deal flow come from? Do you charge for presentations? How often do you hold pitches? Do you help prepare pitches? Do you all invest together, or all make their investment decision separately, or a fund?) – so a quick summary of what you do and how you do it. • What works really well for you. What are the 1,2,3 things that make this work and your group would fail if you didn’t do it. • What didn’t work and so you abandoned it (or fixed it)? • What do you expect to do in the future to remain successful? • Any type of technology that you are using that helps fuel your success? (Such as Skype meetings, or distribution of documents, or preparation of pitch videos, etc.) • Anything on the horizon (technology, trends, government regulation) that might cause you to have to make big changes? Boris Mann @bmann • October 2014