Startup Business Plan

Corporate Governance Requirements For Angel Investors

Angel Investing is inherently risky. Startups, in general, aren't for the weak at heart. It is even more perilous when investing with minimal leverage that comes with a small investment of $25 - $50 thousand. Over a 10 year period, I made 7 investments that returned 180 percent. Over the same period of time, the S&P returned 250 percent. Yes, I took 50 times the risk to get a fraction of the return. How could I have improved the returns? I should have insisted that companies followed certain corporate governance norms. And if I didn't have the leverage to dictate good governance, I should have invested alongside someone who had the power to mandate good corporate governance terms. Let's look at my investments to illustrate what I mean? Winners With Responsible Leadership Social Tables - Great Management Team, Frequent Credible Business Status, and Financial Reporting and Regular Board Supervision Veenome - Great Founder, Frequent Credible Business Status and regular investor conference calls seeking input. Sideways With Responsible Leadership TalkLocal - Great Management Team, Frequent Credible Business Status, and Financial Reporting and regular investor conference calls seeking input. Winners With Leadership Issues none Losers With Leadership Issues SpotFlux - Not sure, I invested...

How To Invest in Startups

This is Mr. Cranky's Official Guide on How To Invest in Startups. Now a better topic than How To Invest in Startups would be Why The Hell Would You Want to Invest In Startups but that's another article. Also, a warning. These are my opinions, based on experience as a limited partner in Venture Fund and an Angel Investor. Do not make investment decisions based on this article! Got that? It's just observations of the various choices and the relative benefits and pitfalls of multiple investment methodologies. No primer on how to invest in startups would be complete without a primer on the state of Venture Capital. Venture Capital Investment today is divided into the Haves and the Have Nots: The Haves (THs) - a group of venture funds who raise money from top financial institutions and endowment funds. The THs don't have to actively go out and raise money, there's a long line of Limited Partners ready to invest well over $1 million dollars in the fund to get access to the "best deals." If you're reading this to learn something, you can't invest in any of THs. THs get access to the best deals and in order to limit competition...

All Eyes on Jonathon Perrelli and Fortify

So there's this guy in town (DC) who likes to play dress up. While all the other kids were playing Cowboys and Native Americans, this guy dressed up like he was a Venture Capitalist.  I'm talking about Jonathon Perrelli and Fortify. Back in the day, he played big venture capitalist boy. Today, all the other kids are playing astronaut, but little Jon is playing big-time CEO of a hot, water-bottle startup (not hot water but a hot startup and regular water). Nine years ago, there were some people in town who gave little Jonny P, real money which he spread around DCTech like cash was apple seeds and little Jon was Jonny Appleseed. Dressed up like a VC, he indiscriminately spread the cash randomly with no thesis, strategy or plan, throwing some here and there. Ninety percent of JP's investments were or are dogs. But just like a blind squirrel...

Fireside Chat with Dan Berger, Social Tables

Thank you to Tien Wong and Connectpreneur for hosting my fireside chat with Founder and CEO, Dan Berger, Social Tables. If you've never been to one of Tien's Connectpreneur conferences he puts on a great show and you should check it out here: Connectrpreneur If you can't see the video you can link to it here: https://youtu.be/O3i_CIuB7Dg The transcipr of the interview follows: Me: Don, this is probably the first time we've been together since I last sat on your board probably four years ago. Dan: Yeah it's been it's been roses ever since. Me: True, so let me let me let me replay to you and to the audience how we first met. I was at a DC tech meetup, the date was April 5th 2011.  I had put out a tweet that the Dingman Angels were looking for good companies to possibly invest and I received this tweet back, @glehel hey! Let's try to connect at the end of the meetup. — Dan Berger (@danberger) April 5, 2011 Signed, Dan Berger, I was later to find out that then that Dan is pronounced Don and we then met at a Starbucks. Can you tell us a little bit about that? A week later we're at Starbucks you your partner and what did we talk...

Culture Evolves

Culture alignment is the single best predictor of career success. When a human is aligned with the culture of their employer, team or tribe, they care more, they feel at home, they are family, and they perform at high levels. As circumstances in healthy growing companies change, culture evolves. Family businesses, small companies, startups may begin as a loyalty culture to a culture of owed-respect. When a company is growing, has more resources and puts a premium on growth, culture evolves from owed-respect to earned-respect, from a loyalty culture to a performance culture. In living, breathing, healthy companies, culture evolves. I was reminded of this during the ConnectPreneur Conference last week where I had the opportunity to sit down for a fireside chat with Dan Berger, the dynamic founder and CEO of Social Tables, one of DC's most healthy growing companies. I first met Don in 2011 and I was one of the first Angel Investors to stroke him a check. I sat on his board and for a while, he was a member of my peer advisory group. In one of our coaching sessions Dan, and I discussed a methodology to define and get team buy-in to a well-defined, intentional corporate culture. Dan was wrestling with...

Evan Burfield Fail – 1776 Part 3

Welcome to Evan Burfield Fail Part 3, in which I will trace Evan's creation of 1776 to his demotion to CEO of Union (to catch up you can read parts 1 and parts 2 here). In whole these 3 posts track the rise and fall of Burfield or Evan Burfield Fail. In an upcoming post, I will track the Burfield Effect on the DC Ecosystem and make some predictions about his future. If you are keeping score at home: I predicted the failure of 1776 years ago, albeit they breezed past my failure prediction of 2015 I predicted that 1776 would be bought out by Benjamin's desk I predicted that this so-called merger was an actual buy-out of a failing 1776 by Benjamin's Desk DC's Mr. Cranky or DC's Nostradamus? Stay tuned! Evan Burfield Fail - 1776 Coworking In 2012 Startup DC, enabled Burfield to cozy up to the DC Mayor's office. Mayor Gray. As the Startup America initiative was winding down, Evan developed his plan to leverage his relationship with Startup America's, Donna Harris, Mayor Gray, and David Zipper, the Business Development Director for DC. In a process that took place in a darkened smoke-filled room of DC's version of Tammany Hall, Evan and Donna proposed...

Jonathon Perrelli Bottle

Jonathon Perrelli Epilogue Part 3 (revised)

Prologue to the Jonathon Perrelli Epilogue Two weeks ago, I posted the first of a 3 part series Jonathon Perrelli Fortify VC Part 1 with a follow-up Part 2 last week. Yup, there goes Mr. Cranky picking on a poor pioneer of DC's Startup Ecosystem. Not one of the people who protested about the series did so by refuting any of the facts presented in those posts. JP didn't respond to my request for information, nor did he reply in comments, except possibly under the pseudonym "goonsquad" in the comment section of the first post. All of the folks who protested my first two blog post protested with the same response...

The Fort - Jonathon Perrelli Fortify VC

Jonathon Perrelli Fortify VC Part 2

Jonathon Perrelli and Fortify VC Part 2 (see part 1) It was April 23rd and I had just posted an article about questionable startup investors titled, Pretangel Alert – Beware Fake VCs And Angels. That post was a warning for founders to be on the lookout for faux investors that pretend to be interested in investing with the true intention of garnering paid consulting engagements. In this post I non-derogatorily mentioned a couple of Investment Funds, including Fortify that were in a Zombie state...