early stage
Auto Added by WPeMatico
Next-gen skincare, silk without spiders and pollution for lunch: Meet the biotech startups pitching at IndieBio’s Demo Day
Biotech can often, and sometimes literally, fly over our heads. However, the pandemic has shown an increased need for investment and focus on solutions that work on human and planetary health. For IndieBio, a science and biotech accelerator run by VC firm SOSV, this unprecedented year offered high stakes and new challenges.
Today and tomorrow, the biotech accelerator is hosting its twice-annual demo day.
Starting in 2015, IndieBio has provided resources to founders solving complex challenges with biotech, from fake meat to sustainability. Over the years, the accelerator has created a portfolio of biotech companies valued at over $3.2 billion, including companies like Memphis Meats, which develops cultured meat from animal cells; NotCo, a plant-based food brand; and Catalog, which uses organisms for data storage.
As part of the accelerator, each participating company receives $250,000 in capital, numerous other services and access to lab space. In July, the founder and head of IndieBio, Arvind Gupta, left his position to pursue a role at Mayfield. While Gupta remains an adviser, Po Bronson took the role as the new managing director.
Bronson was immediately put to the test. This year, the program expanded from operating solely in San Francisco to also create a cohort based in New York. It also doubled the amount of companies it invested in, bringing this cohort to 20 companies.
As you can imagine, lockdowns ultimately forced founders to delay key lab work in the beginning of the pandemic. Eventually, founders were able to partner with universities, contract research organizations or other biotech accelerators to begin their research, says Julie Wolf, the head of investor relations at SOSV. The NYC class received a “golden ticket” for free lab space come November.
And these dynamics make this cohort all the more fascinating to dive into.
Watch the New York Stream here, which will happen on Tuesday October 27 from 1:00-3:00pm ET.
Watch the San Francisco stream here, which will happen on Wednesday October 28 from 10:00-12:00pm PT.
For those who can’t tune in, here’s a list of all the companies presenting in New York and San Francisco over the next two days.
San Francisco cohort
Reazent: Founded by Sumit Verma, Reazent has discovered and patented a way to manipulate soil bacteria into triggering crops to grow more. It works with 116 strains, from kale to potatoes, and wants to dig into the market of organic agricultural land.
Image Credits: Witthaya Prasongsin / Getty Images
Kraken Sense: Founded by Nisha Sarveswaran, Kraken Sense has created an in-line autonomous device to measure the concentration of pathogens in large-scale food and water systems. The product can be deployed in farms and kitchens and uses refillable single-use cartridges.
Advanced Microbubbles: The startup, led by Jameel Feshitan, has created a platform that helps practitioners deliver drugs to complex and difficult tumors. The company collaborated with NIH NIDA and uses proprietary bubbles to deliver chemotherapeutics. Currently, Microbubbles is working to solve two types of cancers: neuroblastoma and pancreatic cancer.
Cybele Microbiome: CEO Nicole Scott has created a direct-to-consumer skincare line with a focus on prebiotics. The line uses ingredients that work in tandem with the skin microbiome, even triggering it to express natural scents.
Ivy Natal: Ivy Natal is developing a process to harvest healthy human egg cells from skin cells. CEO Colin Bortner is working on a treatment for infertility and plans to enable families to have genetic children who can’t otherwise with current solutions.
Microgenesis: Led by Gabriela Gutierrez, Microgenesis has created a proprietary test and nutraceutical regiment (including probiotics) to help women who struggle with infertility get pregnant. The company worked with a cohort of 287 mothers, and with its product over 75% of patients became pregnant.
Image Credits: Westend61 / Getty Images
AsimicA: Led by Nikolai Mushnikov, Asmicia has created a new way to bring stem cells to microbes. The company could lengthen and grow the yields of bio-manufacturing, and is currently working to select the right fermentation partner.
Liberum: CEO Aidan Tinafar is working to disrupt what they think could be a $400 billion market opportunity: recombinant proteins. Liberum has created a protein printer that could cut down the creation of custom recombinant proteins from weeks to a few hours.
Khepra: Led by Julie Kring, Khepra is leveraging fuel production as a way to store extra renewable energy. The company is building a series of reactors that could take your old plastic bottles and cardboard boxes, extract chemicals and fuels, and sell that fuel to refineries.
Carbix: Carbix, led by Quincy Sammy, takes enriched CO2 and converts it into raw material that can then be repurposed into industrial products.
Spintex: CEO Alex Greenhalgh is creating a new, scalable way of making silk. The company mimics spider spinning and uses a natural protein, with an end product that they see as better than premium silk.
New York cohort
Biomage: CEO Adam Kurkiewicz wants to make single-cell sequencing data more accessible for research biologistics. The technology could help scientists explore human cells to enhance medicine and drug discovery.
Diptera.ai: Vic Levitin is creating a scalable, affordable and sustainable way to fight mosquitoes and their diseases.
Cayuga Biotech: Damien Kudela, CEO of Cayuga Biotech, has created a drug that could induce clots and stop severe bleeding situations.
Brightcure: Chiara Heide, CEO of Brightcure, has created a bioactive cream that uses natural bacterium to restore a woman’s natural microbiome.
Multus Media: CEO Cai Linton is producing an ingredient that hopes to make cultivated meat production affordable and accessible.
Image Credits: Getty Images
BioFeyn: The company uses nanotechnologies based on human medicine to deliver nutrients and disease prevention to fish. CEO Timothy Bouley is working to make eating healthy fish a sustainable practice.
Halomine: Ted Eveleth, CEO, wants to turn every surface into an antimicrobial surface. Halomine’s product, Halofilm, can be used in tandem with any household bleach cleaner to enhance disinfection techniques.
Allied Microbiota: Lauralynn Kourtz, CEO of Allied Microbiota, wants to use natural microbes to eliminate toxic waste. The company uses bacteria to clean contaminated soils.
Scindo: Scindo, led by Gustaf Hemberg, uses enzymes to make plastic biodegradable.
Powered by WPeMatico
This startup wants to fix the broken structure of internships
Internships are an opportunity for students to experiment with new career paths and land a full-time offer ahead of graduation. For companies, the weeks-long programs help recruit and train job-ready hires.
While the stakes are high, the coronavirus-spurred office closures and market volatility made a number of tech companies slim down or cancel their internship programs. Similar to remote schooling, the startups that kept their programs had a huge hurdle to face: How do you teach and train students across the world about your company?
That’s where Symba, a Techstars alum, comes in. The 12-person startup created a white-label software tool to help companies, including Robinhood and Genentech, create an online space to communicate and collaborate with their now-distributed interns.
“Every year, organizations are reinventing the wheel and starting their internship program from scratch,” Ahva Sadeghi, CEO of Symba, said. “It’s like, you’re spending so much money, this is a core part of your recruitment, but you’re not invested in an infrastructure to make sure it’s sustainable.”
Symba sells a plug-and-play workspace for both interns and managers. Interns sign into Symba through a branded landing page and are brought into a workspace. They can then toggle between feedback, community, profiles and projects. There’s also an entire area for onboarding tutorials and company history.
Interns are brought to a workspace upon login. Image via Symba.
Sadeghi is joined by co-founder and CTO Nikita Gupta, who built the entire site from scratch.
Symba was built with a big focus on creating channels for feedback between interns and managers. There is a tab dedicated solely to feedback, where managers can consistently rank their direct reports on a five-star rating scale across various skills. Interns are also able to request feedback.
Each user is invited to create a profile so other interns can reach out and learn about their cohort. While Symba wants to be where interns live during their internship, there’s no direct messaging mechanisms within the web-based platform. Instead, Symba has embedded a Slack integration for users who want to talk directly.
The community board allows interns to meet other interns and chat. Image via Symba.
Managers, on the other hand, are able to log in, assign tasks and check on progress for their direct reports. Feedback is also tracked during the entirety of the internship, to help see who has made progress and deserves a potential return offer.
Because interns come in for only eight to 12 weeks, she says the traditional internship onboarding process — which includes bringing them all onto a company’s full-time tech stack — could create chaos for the organization. Symba wants to be a low-lift alternative.
Sadeghi says that customers have been attracted to the alumni features in their platform, which allow managers to engage interns after the program is complete. The applicant-tracking system works to keep potential hires in the fold of the company.
So far, Symba is optimistic that the tool is working. Users log into the product an average of six to nine times per day, and there have been more than 15,000 intern-projects created on Symba.
The company declined to disclose revenue, citing the stage of its business, but said that it charges companies $30 to $50 per user per month for the product. The average size of a Symba cohort is 80, but they have had customers who bring more than 2,000 interns onto the product. It only works with companies who pay their interns.
A hurdle of Symba will be the seasonality of its revenue. Because most internships are in the summer, Symba will likely find most growth opportunities during that three-month period.
Symba’s early growth is directly related to the pandemic, as the fear of the virus closed offices, and, in turn, shuttered internship programs. Symba’s success will hinge on if the team can convince companies that an online workspace for interns is a necessary product even when offices reopen.
Beyond translating into a post-pandemic world, Symba wants to be a solution for clients such as bootcamps, accelerators or fellowships. If it’s able to land year-round clients, it will be able to balance the seasonality of its current revenue of summer internships.
The success so far is promising: Early momentum has helped Symba raise $750,000 from a number of investors, including 1517 Fund, January Ventures and Hustle Fund.
Powered by WPeMatico
Founders don’t need to be full-time to start raising venture capital
“More than 50% of our founders still are in their current jobs,” said John Vrionis, co-founder of seed-stage fund Unusual Ventures.
The fund, which closed a $400 million investment vehicle in November 2019, has noticed that more and more startup employees are thinking about entrepreneurship as the pandemic has shown how much room there is for new innovation. To gain a competitive advantage, Unusual is investing small checks into founders before they’re full-time.
Unusual, which cuts an average of eight checks per year into seed-stage companies, isn’t doling out millions to every employee who decides to leave Stripe. The firm is conservative with its spending and takes a more focused approach, often embedding a member from the firm into a portfolio company. It’s not meant to scale to dozens of portfolio companies a year, but instead requires a methodical approach.
One with a healthy pipeline of companies to choose from.
In an Extra Crunch Live chat, Vrionis and Sarah Leary, co-founder of Nextdoor and the firm’s newest partner, said lightweight investing matters in the early days of a company.
“There were a lot of teams that needed capital to start the journey, but frankly, it would have been over burdensome if they took on $2 or $3 million,” Leary said. “[New founders] want to be in a place where they have enough money to get going but not too much money that they get locked into a ladder in terms of expectations that they’re not ready to take advantage of.” The checks that Unusual cuts in pre-seed often range between $100,000 to half a million dollars.
Leary chalks up the boom to the disruption in consumer behavior, which opens up the opportunity for new companies to win.
Powered by WPeMatico
Announcing the TC Pitch-Off: Mobility startups
For the past two years, TechCrunch has brought together the best and brightest minds in mobility at our TechCrunch Sessions: Mobility event. This year, we are adding a little extra twist. On October 5, the day before Mobility 2020, TC is hosting a pitch-off — which only ticket holders can access — highlighting disruptive startups in the mobility space. Startups from all over the world applied, only 10 made the cut.
Founders will pitch on the virtual TC Stage for one minute, followed by an intense Q&A with our judges. After all 10 companies have pitched, the illustrious set of judges — Shahin Farshchi (Lux Capital), Natalia Quintero (Transit Tech Lab) and Rachel Holt (Construct Capital) — will select the top five companies that will go on to pitch at the main event on October 7 in front of investors, press and thousands of online viewers.
Check out the featured companies here:
Automotus
BuuPass Kenya Limited
DUCKT
fluctuo
HyPoint
Le Car
Movel AI Pte Ltd
ONO (ONOMOTION GmbH)
PreAct Technologies
Shelf.Network
To see the startups pitching on October 5, you can snag an exhibitor pass for just $25. It’ll get you access to the pitch-off, breakout sessions from ChargePoint and access to visit all of the early-stage mobility startups in the expo for all the days of TC Sessions: Mobility. But if you really want to take it to the next level, get an all-access General Admission ticket for $195 that gives you access to the main stage speakers, networking and a complementary Extra Crunch membership (worth $99). But you’ll need to grab your tickets before Monday, October 5th when prices increase!
Powered by WPeMatico
Announcing the Startup Battlefield companies at TechCrunch Disrupt 2020
TechCrunch is thrilled to announce the 20 companies pitching in Startup Battlefield. Founders from around the world will be connecting in remotely to pitch live on the virtual TechCrunch Disrupt 2020 stage. Our most competitive batch to date, startups will be vying for $100,000 in equity-free prize money and the attention of tier-1 investors and global press.
The competition is stiff. The selected startups have undergone a rigorous application process, with a 2% acceptance rate. This year’s batch is exceptional. From green engine design to social networking video tools, GIS construction management to central American banking platforms for women, and adaptive Sub-Saharan African transportation to healthcare affordability, these companies make groundbreaking innovations in their verticals. Startups featured run the gamut — water conserving vertical farming in India, screen-less interfaces, security tech, multi-lingual adaptive children’s learning toys and even 3D-printed rocket fuel.
Teams have trained for weeks with the Startup Battlefield team to hone their pitches, polish their live demos and strengthen their business launch strategy. Monday through Thursday, startups will pitch live for six minutes, followed by a six-minute Q&A session with our expert judges. On Friday, the finalist companies selected will pitch again for the final Startup Battlefield round — this time with a new set of judges.
Startup Battlefield starts on Monday, September 14th at 10:30 a.m. Pacific Time, with Startup Battlefield moderator and TechCrunch Senior Writer Anthony Ha. To watch the live stream simply log in to TechCrunch.com. You can also gain access to the full Disrupt 2020 experience here.
Let’s check out the companies:
Monday
Session 1: 10:30 a.m. – 11:35 a.m. PT
Matidor, Clinic Price Check, Firehawk Aerospace, Satellite Vu, DaVinci Kitchen*
Tuesday
Session 2: 10:30 a.m. – 11:35 a.m. PT
SoloSuit, Tuverl, Latent AI, HacWare, Vibe*
Wednesday
Session 3: 10:30 a.m. – 11:35 a.m. PT
Jefa, Touchwood Labs, Rally.video, Luther AI, Kiri
Thursday
Session 3: 10:40 a.m. – 11:45 a.m. PT
Perigee, Urban Kisaan, Crover, ClearFlame Engine Technologies, Canix
Friday
Finals begin at 10:40 a.m. PT. Companies will be announced online Thursday night.
*As a part of Startup Alley, companies are eligible for the Wild Card. These are the companies selected for Wild Card and can compete in Startup Battlefield. They are selected only days before the event.
Powered by WPeMatico
Marketing, PR and brand building, oh my! TechCrunch Early Stage goes down July 21 and 22
Your product may solve problems. It may cost less and do more. It may very well change the world. But unless you can get the word out, ensuring the right group of people know about it and are willing to use it, pay for it and evangelize it, then your hard work is in vain.
At TechCrunch Early Stage, we’ll hear from some of the world’s top minds in the fields of marketing and brand building. They’ll talk through different growth marketing tactics, from creating growth assets for paid channels to capitalizing on podcasts to SEO to email. They’ll cover the complicated world of PR, and they’ll teach us about how to develop a brand that users can relate to.
Of course, this is just one slice of the pie. At Early Stage, experts across a wide variety of startup core competencies — fundraising, legal, recruiting, tech stack, scaling and more — will take the virtual stage to give early-stage founders the tools they need to get out there and succeed. What’s more, these experts have made time to answer audience questions, so don’t be shy!
Here’s a look at all the marketing sessions you can expect at the show:
Why should anyone care? (Making your brand stand out) with Caryn Marooney
Startups often struggle to create a narrative that stands out. As a general partner at Coatue, former head of Comms at Facebook and co-founder of the OutCast Agency, Caryn Marooney has seen it all. Come learn the brand and messaging framework that can help your company stand out (while staying true to yourself.)
Growth Marketing: Minimum viable email with Susan Su
Love it or hate it, email is here to stay. But understanding where it fits into the conversion funnel and how to maximize its impact can be arduous. Learn from Sound Ventures partner Susan Su how to optimize open rates, deliverability, unsubscribes and conversions for consumer and enterprise products alike.
How to build a high-performance SEO engine with Ethan Smith
Hear from Ethan Smith, who has worked with brands like MasterClass, Ticketmaster and Thumbtack, as he shares some of the most effective modern SEO strategies. Starting with a deep understanding of the user and their intent, the most successful modern SEO strategies focus on building a data-driven approach to drive user experience, content and conversion to ultimately beat the competition.
Be the best at preparing for the worst with Margit Wennmachers and Miguel Helft
Inevitably, something will go wrong — from product recalls and lawsuits to executive firings and sexual harassment allegations, so you better be prepared. Hear from Margit Wennmachers, operating partner at Andreessen Horowitz and a co-founder of OutCast Communications (now The OutCast Agency) and Miguel Helft, editorial director at Message Lab, about how to develop a framework for crisis and withstand through tough times.
Growth Marketing: Podcasts as a secret weapon with Krystina Rubino and Lindsay Piper Shaw
Podcast advertising is widely viewed as a nascent medium, but smart companies know it can be a powerful channel in their marketing mix. Opportunity is ripe — get in early and you can own the medium, box out competitors and catapult your growth. Krystina Rubino and Lindsay Piper Shaw have launched and scaled successful podcast ad campaigns for early-stage startups and household name brands and will be sharing their strategies for companies to succeed in this often misunderstood channel.
How to get people obsessed with your brand with Emily Heyward
During her 12-year tenure running Red Antler, one of the leading brand companies for startups and new ventures, Emily Heyward has launched more brands than anyone. In this session for TechCrunch Early Stage, she’ll share the modern rules of brand building, breaking down the traditional notions of how modern brands look, feel and behave. Covering a few case studies and tactical applications, Emily will outline the best practices for driving obsession from day one while also building a foundation for long-term growth.
How to create great growth assets for paid channels with Asher King Abramson
Learn about the right ways and wrong ways to create great assets for paid channels, landing pages and more in this teardown workshop with Asher King Abramson, a top growth marketer who has worked with 100+ successful startups. Submit your landing page and ads beforehand for a chance to receive feedback live onstage.
A brand personified with Anna Pickard
Anna Pickard is the head of Brand Communications at Slack, responsible for establishing the company’s voice and tone. Hear Anna share how to bring together the various functions of your organization to create a distinctly unique brand voice that engages and delights customers.
Early Stage goes down July 21 and 22. You don’t want to miss it. Tickets are almost gone — register for your ticket here.
Powered by WPeMatico
Emily Heyward will teach you how to make your brand awesome at TC Early Stage
If you’re currently building a startup, you know what product you want to build. But do you know if people are actually going to notice you? Emily Heyward from Red Antler can tell you how to get people obsessed with your brand.
Join us at TC Early Stage online to understand what makes a specific brand stand out from the crowd. And if you pay attention to her advice, your first customers could become your best assets to reach your next big wave of users.
Red Antler works with founders to help them define the vision for their startups. As the co-founder and chief brand officer of Red Antler, Emily Heyward has worked with some of the most iconic brands of the past decade, such as Casper, Allbirds, Brandless and Prose.
She knows her topic so well that she just wrote a book on branding called Obsessed. But if you want to hear from her directly, TC Early Stage gives you an opportunity to go through the modern rules of brand building.
With this session, you’ll know how a modern brand is supposed to look, feel and behave. Heyward will also go through a few case studies and outline the best practices to build a solid brand from the early days of your startup to the later stage.
TC Early Stage is our brand-new, all-virtual event that focuses on helping new founders get exactly the information they need, straight from the experienced founders, executives, investors and lawyers that know it best. It’ll run from July 21 to July 22 and will feature more than 50 breakout sessions on topics covering everything from fundraising, to hiring your first engineers, to the tech stack you build your product on.
And because it’s a virtual event, you can stay right where you are and join the show from your home. Each of the 50+ breakout sessions is limited to around 100 attendees so that you can ask your questions directly to the experts who have agreed to join the event. If you’re an attendee and miss a breakout session, you will be able to view the video on demand for all sessions exclusively.
You can grab your ticket to TC Early Stage right now; find more details on our event page.
Powered by WPeMatico
Get your pitchdeck critiqued by Accel’s Amy Saper and Bessemer’s Talia Goldberg at Early Stage
The art of the pitchdeck. Few things are more critical to the success of startups seeding capital. And make no mistake, it is an art.
At TechCrunch Early Stage, our two-day virtual event focused on giving entrepreneurs all the resources they need to build incredible, high-growth early stage companies, we have plenty of content dedicated to the pitchdeck.
From a session on how to think like a PM for VC pitch success led by Lo Toney, to a session on how to time your fundraising sprint led by Jake Saper, to seed funding tips and tricks from Jeff Clavier, there’s something for everyone. Even if you don’t have a product, Charles Hudson will teach you how to sell your idea to investors.
The cherry on top of that pitch perfect sundae? The Pitchdeck Teardown.
Accel’s Amy Saper and Bessemer’s Talia Goldberg will lead the Pitchdeck Teardown, going over the look, feel and information provided within individual pitchdecks to share what they look for, what they don’t want to see, and how to get the best outcome when you send a VC your deck.
The coolest part is that the pitchdecks aren’t theoretical. Early Stage attendees can submit their pitchdecks ahead of time for a chance to see those decks critiqued live on stage.
Interested in being a part of it? Submit your pitchdeck here. But remember, you must be registered as an attendee of Early Stage to be selected.
TC Early Stage has so much to offer. The show will bring together 50+ experts across startup core competencies, such as fundraising, operations, and marketing. Cyan Bannister is set to explain how to get an investor to say yes to your startup. Asher Abramson will be sharing how to create growth assets for paid channels, lawyers James Alonso and Adam Zagaris will share how to draw up your first contracts, and Priti Choksi is hosting a session on how to get a company acquired rather than selling.
The two-day show features more than 50 sessions, but don’t worry; attendees will get transcripts for all of them. What’s more, most of the speakers, who happen to be investors, are participating in TechCrunch’s CrunchMatch, our platform that connects founders to investors based on shared interests.
Here’s the fine print. Each of the 50+ breakout sessions is limited to around 100 attendees. We expect a lot more attendees, of course, so signups for each session are on a first-come, first-serve basis.
Buy your ticket today, and you can sign up for the breakouts we are announcing today, as well as those already published. Pass holders will also receive 24-hour advance notice before we announce the next batch. (And yes, you can “drop” a breakout session in favor of a new one, in the event there is a schedule conflict.)
Get your TC Early Stage pass today and jump into the inside track on the sessions we announced so far, as well as the ones to be published in the coming weeks.
Possible sponsor? Hit us up right here.
Powered by WPeMatico
Hear Charles Hudson explain how to sell an idea (without a product) at Early Stage
Startups often dance between selling dreams and building products, and we’ve enlisted the help of noted investor Charles Hudson to help founders sell an idea before they’ve built a product. Hudson is speaking at TechCrunch’s inaugural virtual event, TechCrunch Early Stage. The two-day event runs July 21 and 22 and will feature sessions targeting all aspects of building a startup.
Hudson has seen a lot of startups over his career as an investor and knows what it takes to sell an idea when there isn’t yet a product. As he’ll explain, this is often a tough skill to learn, and it takes practice to craft the correct message that shows obtainable goals while putting the investor at ease.
Charles Hudson is a managing partner at Precursor Ventures, where he focuses on pre-seed investments in companies building B2B and B2C software applications. Before this role, he was an investor at Uncork Capital (formerly SoftTech VC) and In-Q-Tel, the VC arm of the U.S.’s Central Intelligence Agency. Along the way, he’s held various executive and board positions at startups and organizations.
Hudson’s session at TC Early Stage is a must-watch for early-stage founders. Startups begin as an idea, and often that idea needs funds to turn into a product. Hudson will help show founders how to get an investor to buy into the concept before the product is built.
TC Early Stage takes place over two days in July and features 50+ experts across startup core competencies, such as fundraising, operations and marketing. The virtual event features some of the best operators, investors and founders in the startup world. Hear from Ann Miura-Ko on how to find a product-market fit. Ali Partovi is set to talk about how to hire early engineers, and Caryn Marooney’s session will explore how to make your brand stand out.
What’s more, most of the speakers, who happen to be investors, are participating in TechCrunch’s CrunchMatch, our program that connects founders to investors based on shared interests.
Here’s the fine print. Each of the 50+ breakout sessions is limited to around 100 attendees. We expect a lot more attendees, of course, so signups for each session are on a first-come, first-serve basis.
Buy your ticket today, and you can sign up for the breakouts we are announcing today, as well as those already published. Pass holders will also receive 24-hour advance notice before we announce the next batch. (And yes, you can “drop” a breakout session in favor of a new one, in the event there is a schedule conflict.)
Get your TC Early Stage pass today and jump into the inside track on the sessions we announced today, as well as the ones to be published in the coming days.
Possible sponsor? Hit us up right here.
Powered by WPeMatico
The Venture Collective launches with a new bet on pre-seed investing
Venture capital has a long way to go when it comes to investing in underrepresented founders in a meaningful way. But according to The Venture Collective’s Cat Hernandez, the issue is too complex to solve by just cutting checks and spending time with entrepreneurs.
“You have to be maniacally focused on solutions,” Hernandez said.
So, Hernandez has teamed up with a number of operators-turned-investors to tackle tech’s diversity problem from a creative angle.
The Venture Collective, based in London and New York, launches today to make access to capital more equal. Fair warning: its experimental structure is knotty, as TVC is part investment vehicle and part management company. But it’s a creative strategy in a deserving sector that tech struggles to make progress within.
The team is stacked with a variety of experience: Founding partner Nick Shekerdemian is a former YC startup founder who launched a diversity recruitment platform, and his co-founder, Gina Kirch, was one of his investors, as well as a former director at BlackRock. Other partners include former Primary Venture Partners investor Cat Hernandez and Elliot Richmond, who invests out of the United Kingdom and previously worked at Moelis & Company.
The team was finalized during COVID-19.
TVC’s funding model has two customer bases: startup founders and family offices.
For startups, the business will invest a $100,000 check into one company per month, with the flexibility to do more. TVC intends to reserve between $1 to $5 million for follow-on rounds.
For family offices, TVC charges an annual fee to serve as intel for what they think are lucrative pre-seed deals in the Valley. If a family office or someone within its network wants to invest, TVC will ultimately deploy an allocated amount of capital. It hopes that total capital commitments will increase over time.
While TVC says the structure model is in stealth, it is reasonable to compare the structures of these family office investments to the structures of special purpose vehicles. SPVs are investment vehicles that exist outside a fund’s capital allotment and are more spur of the moment, versus traditionally syndicated.
The biggest difference is that SPV structure is centered around deals, but TVC’s structure is centered around a capital allotment, deployed into multiple deals. They essentially act as middlemen between promising startups and family offices.
It’s good news for family offices, as they often take the role of institutional investors, which are decade-long relationships. The problem with lengthy bets is that what was hot in 2010 might not be hot in 2020. TVC’s model lets LPs deploy capital in their interest areas on a year by year basis. So an LP who is newly bullish on remote work (for some wild reason) could get their hands in early deals instead of waiting for the AR/VR fund they invested in years ago to make that move.
Putting all these pieces together, TVC gets more funds by:
- traditional equity raise
- annual fee to provide information to its network
- family office checks
- portfolio exits
Because of all of these mechanisms, TVC’s total “fund size” will change depending on the week. It’s a unique example of how first-time fund managers are tackling investing in a volatile landscape.
Today TVC launches with an undisclosed amount of equity-based financing. The company declined to share total assets under management.
So a big factor in TVC’s success is if it can convince both founders and family offices that its perspective is worth the set up. TVC’s flexibility can be a blessing, but it also can be risky and unreliable in case family offices pull out. Or if there is an extended recession, for example.
As a sweetener, the company says that it will donate two-thirds of partner time to helping portfolio companies.
But how does this fit into diversity? It all goes back to TVC’s goal to make access to capital more equal.
According to the team, pre-seed to Series A is where most companies fail, but the very funds that back pre-seed are also the most strapped for resources (small fund sizes, fixed management fees). Thus, firms have to selectively pick the companies they think are outliers and spend time with those companies on a more regular basis. This disproportionately impacts underrepresented founders, who might have a slower start due to lack of access to resources.
TVC thinks its strategy will help grow the number of startups that are venture-backable by heavily supporting them through this time, without competing and driving up valuations for only a few outliers.
The company defined underrepresented founders through diversity, geography, age and social background. When asked if they will publicly disclose diversity metrics, TVC said “it wants to be thoughtful about how we hold our investments accountable in the long-term and we are balancing that with a desire to not be prescriptive.”
“We believe that part of our job as early investors is to ensure that this intent is top of mind as the business scales. That can come in many forms — tracking/reporting on diversity metrics being one of them. At its core, this isn’t about window dressing,” the firm told TechCrunch. Generally, TVC is focused on helping more people get funding, and pointed toward financial optionality as the “flywheel we’re playing for.”
In terms of sourcing, TVC is partnering with tech-focused groups in New York and London and will identify talent at the university and college level. It also said it will build relationships with underrepresented operators “at the most prominent tech companies” and co-invest with diversity-focused founders.
TVC also launched a group called “The Collective” that includes diverse founders, operators and investors, who will help as a deal flow channel.
Powered by WPeMatico