Event Review: SVASE Startup-U SF 10 May 07
Working with the Angel Community - Angel vs. VC was the theme of this Startup-U session. While no angels were on the panel, it was still very useful, as the three VC’s represented 3 different VC funding/business models.
Bart Schachter of Blueprint Ventures represented the traditional VC model - A VC with a large fund, making typical A rounds of $3 - $5M, and needing a 10x - 20x return in order to “move the needle” of their portfolio for their LPs.
Carl Showalter of Opus Capital represented the smaller VCs. Opus does both seed and A rounds, and will entertain much smaller A rounds - $1M or so. They expect to typically partner with at least one other VC in an A round. Opus will also do a bridge loan in lieu of a seed/A round in order to get some quick forward movement if they believe that they will eventually do an A round.
Doug Renert of Tandem Entrepreneurs represents a newer model of VC that I would best describe as Small VC meets incubator. Tandem will fund a seed/A round of typically less than $1M with the intent that Tandem’s VCs will be extremely active in the day-to-day operations of the startup, rather than just providing guidance on a monthly basis.
There was some good discussion and interplay between the audience and the panelists, although much of it was introduction to VC/Introduction to these particular VC firms.
One interesting topic was sales people for pre-product/pre-revenue startups. Both Bart and Carl were very positive on a company if they had sales people at this stage (assuming the salesman was good). Good salespeople can earn a lot of commission dollars working for the large enterprise players. There’s a lot of goodness if they’re committed to a startup without immediate revenue opportunities.
Networking both before and after the event was good, and I met a lot of good people. I had an interesting conversation with Cooper Marcus of Spark Parking. Cooper mentioned that he had recently attended a mobile startup pitch event. He said that anytime one of the companies mentioned that they required either interaction/cooperation of the carrier, or to download their program onto the phone, the company received immediate, emphatic negative feedback. Working with the carriers is extremely difficult, and there are a raft of problems with phone downloads. This was great feedback for me, as my current thought are wrapped around a mobile service.