Vetting an Opportunity Like a Venture Capitalist
I have been in and around company-building, technology, and venture investing for most of my life. I started my first company – a landscaping business named after my younger brother – in high school. Building that small business helped me pay for college, but it did something even more important. I remember securing my first contract like it was yesterday. At that moment, the entrepreneurial hook was set.
Over the 25 years since building that first company, I have had the privilege of working with or in dozens of companies. They’ve ranged in size from raw startups to Fortune 10 enterprises. I’ve worked in the U.S. and international markets, all with a technology leaning.
When I was offered the opportunity to join Alumni Ventures Group, I put on my familiar VC hat to conduct my due diligence. Taking on a new role at a young company and moving our family from the leafy suburb of Westport, Connecticut to the urban grit of Manchester, New Hampshire, was a big change. Once I’d done my homework, I knew it was the right move. While there were many facets to the decision – it’s no coincidence that many of them parallel the considerations I’ve factored in my most successful venture investments in the past.
Back the Right Team
When I evaluate a potential investment, one of the first areas I examine is the management team. Having the right leadership at the helm can make all the difference when it comes to a company’s future success. AVG’s team, and its founder and CEO Mike Collins, gave me confidence in the decision to come on board.
Mike founded AVG in 2014, with the vision of democratizing venture capital and bringing this important asset class to the individual. This vision is in stark contrast to how the industry has historically operated.
Since the 1940s, emerging private companies have largely been backed by venture capitalists. These investors raise their funds from institutions, pension funds, and endowments. While these institutional investors benefit greatly from the success of “unicorns” like Apple, Amazon, Google, and Facebook, on the whole, individual investors have to wait until these same companies go public before they can take advantage of their appreciating stock values.
Mike thought there was a better way and went about building AVG and its family of funds.
This undertaking wasn’t like starting any other investment fund. Mike and the team originally met with skepticism for this disruptive approach to venture. As the funds gained traction, however, that doubt gradually gave way to logical acceptance. Today, AVG is consistently ranked as one of the most active venture investors in the United States.
Partner with the Best Problem-solvers
I’ve had some big wins in my venture career. I’ve generated 7X cash-on-cash returns as a professional venture investor – turning $72 million into more than $500 million in realized gains. With this track record, my personal venture portfolio should be a walk in the park, right?
On the contrary, despite this professional success, my personal venture portfolio did not fair nearly as well. Although I continued to be well stocked with interesting investment ideas after leaving the venture business – and though I retained my sense of pattern recognition for what makes a good deal – I lacked the massive network required to identify and access the best investments available.
Successful investment requires a solid team with access to the right network, working to secure good deals with best-in-class startups. It also requires a level of reach even savvy individual investors simply don’t have. AVG has bridged this gap by building relationships with the largest VC firms, co-investing alongside them in their deals, and benefitting from their vetting and access. This level of access would otherwise be impossible for the retail investor.
Finally, I joined AVG because innovation matters. It advances civilization and ensures a better outcome for the issues facing our fragile planet. Whether startups are using technology to radically increase information flow to spur nascent democracies, or to introduce a cool new gadget that bring a little joy into our daily lives, technology is relevant; it’s something to be embraced. Through investments that influence the future of healthcare, fintech, IT innovation, and consumer products, AVG plays a small but important role in this vibrant landscape.
As a prospective employee for AVG, I put my VC skills to work vetting the company and its mission. As our new Chief Investment Officer, I’m excited to use those skills on behalf of our stakeholders – evaluating our strategy, seeking out ways to innovate within the VC ecosystem, and moving the needle for AVG, our portfolio companies, and our investors.
Every day at AVG is inspiring. We invest, we build, we work. We matter. And I’m happy to be a part of it.
10,000 Entrepreneurs (10KE) seeks to help young adults explore entrepreneurial careers.
Alumni Ventures Group (AVG) has set up 10KE to enable people to more easily explore entrepreneurial careers. We believe that the world needs more builders, makers, innovators, and creators – not more lawyers, consultants, and investment bankers. And if you want to be a lawyer, we’d prefer you to be an entrepreneurial lawyer.