I believe that there is a unique opportunity to fund high-potential companies led by underrepresented founders. Diversity has proven to be lucrative, yet traditional VC pattern-matching is leaving billions of unrealized returns on the table.
I have a competitive advantage in my ability to recognize unique opportunities and patterns that traditional investors won’t always understand or relate to. My niche positioning allows me to attract distinct investment opportunities that I've already been sharing with top investors for years, and am excited to share with a larger pool today.
An AngelList syndicate allows me share the best deals with more people at lower individual investment amounts. You can invest as little as $1,000 or as much as $100,000 per deal, and get ownership in some really interesting companies within a few minutes. My team of advisors and analysts and I handle deal sourcing, due diligence, and management of the portfolio while AngelList handles most of the back office stuff that eats up time and resources. This leaves syndicate backers with a curated list of companies to back and more time to make decisions and actually enjoy the process of investing without all of the excess work normally associated.
Some things to note (especially to those who are new to Angel List)…
-investing is RISKY. Period. There's no way to avoid it. Please only invest if you're comfortable losing your investment completely.
-If there are returns, generally they can take years to manifest. Invest only if you're comfortable with this type of illiquidity.
-Expect to see some information regarding metrics, team, projections, etc. But in most cases there will not be a ton of deep dive info available for syndicate backers. Founders will usually be willing and excited to answer your questions on AngelList for the designated investing period, but you will not be able to see confidential documents and the syndicate will have limited information rights.
-I would suggest spreading your investments thinly over several companies to build a portfolio, rather than putting a ton in one or two companies that you like. So for example if you have $25k that you want to invest over the next 2 years, putting $1k or $2k into 10-15 deals whether through my syndicate, someone else's, or offline--in my opinion--is "safer" than putting $25k into one. Diversify, diversify, diversify:) *It's still risky even if you diversify!
If it's so risky, why invest?
-It's fun & educational. If you're not having fun and/or learning, what's the point? If you're stressed out about investing in tech, I'd say watch from the sidelines for a while and only join in when it makes sense for you individually.
-It's impactful. You want to see a certain product, service, or technology reach the mainstream. You're enabling the enablers. You're fueling a new generation of innovation. It can be highly rewarding and exciting to watch a startup grow and a founder's vision realized.
-You could make some dough. Investing is super risky, but it can also be lucrative if the stars align. So there is that chance. And you could perhaps use that money to fund more innovation. That's exciting to some people.
-You like showing off your AngelList portfolio. Hey, I'm not judging…it's YOUR money! :)
None of the syndicate money goes to me, and I’m investing alongside the syndicate. Here’s how it works:
- I see pitches from dozens of companies every month,
- A company that is raising capital has a product, team, traction, and valuation that fits my thesis and investment strategy and really stands out, so I decide to invest in the round,
- The founders like me too, so together we decide on an amount that my syndicate would be able to invest (for example, they’re raising $1,000,000 total, and give me space to invest up to $200,000 of that),
- Through my fund, Backstage Capital, I put in a significant portion of that allocation, and invite my syndicate members to put in what they’d like as well, on an individual basis, with as little as a $1,000 investment each
If you’re considering joining my syndicate, I suggest taking a look at angel.co’s FAQ’s for some really great clarifying info: https://angel.co/help/syndicates
Ebony.com article published on Dec 9th, 2015:
http://www.ebony.com/life/the-upload-the-abcs-of-venture-capitalism-111#axzz3trCzsSfc
My original Medium post announcement:
https://medium.com/female-founders/i-want-to-invest-in-startups-with-underrepresented-founders-f9694692f16e
HuffPo article published on Friday, Sept 18th, 2015:
http://www.huffingtonpost.com/entry/arlan-hamilton-investing_55fc0a92e4b00310edf69c0a
I have a robust channel of exciting deal flow. I've seen and spoken with nearly 2,000 companies since 2012, and currently review dozens of companies per month with my team at Backstage Capital
I'll be syndicating as many of the top deals I invest in as possible. In most cases syndicate deals and their information will only be available to those who are syndicate backers, so sign up today for access!
