Two of Boston’s most active angels, Marlene Boyaner of Golden Seeds and Doug Bates of Walnut Venture, talk to Sal Daher about angel investing, fundraising, building a startup and various other topics. The panel takes challenging questions from an audience of startup founders.
Marlene Boyaner bio.
Doug Bates bio
How Marlene went from intrapreneuring at CIBC & Capital One to angel investing.
Golden Seeds is on the organized end of the spectrum among angel groups; Marlene likes the way it operates.
Entrepreneurship was a natural for Doug Bates due to several examples of in his family.
Founded a successful business with the woman to whom he was married at the time.
Put his wife’s idea through a thorough MBA-type scrutiny and became convinced it would work.
Golden Seeds seeks to ensure that women get their share of startup funding and invest in businesses where they can see the possibility of an exit. They are generalists, no industry focus.
When Golden Seeds started women got only 3% of startup funding, now women get 27% of such funding. Women now start 50% of all businesses so it seems that Golden Seeds has room to grow.
Startup Parade: Fortified Bike from which was spun off Save My Sales. Doug admires founder Tivan Amour who has been interviewed on the Angel Invest Podcast (Link to Tivan Amour's Podcast). Sal is also an investor.
Fortified Bike was a theft-proof bike business which proved to be a hard ride. While trying to get the bike business up the hill, Tivan built a highly effective texting tool that drove sales very powerfully. That’s the business that became Save My Sales.
Tivan demonstrated integrity in the way he migrated to Save My Sales by giving investors in Fortified Bike stakes in the new company.
Startup Parade: Clean Fiber has a prosaic business but an extremely sound one. The team is impressively high-performing in building out a new production process for producing insulation with recycled materials. Doug likes the boring but lucrative niche they occupy.
Startup Parade: Marlene Boyaner brought up Day Zero which has technology to determine at the outset of treatment what is the best antibiotic to use on an infection. Currently, patients with severe infections are started on broad spectrum antibiotics until the result of cultures allows the determination of the ideal treatment.
Startup Parade: Marlene Boyaner also mentioned Acivilate helps people involved with the justice system get better results in terms of lower recidivism. Although this is not an industry Marlene would have anticipated investing in, the ability of the team was so compelling that Golden Seeds has backed Acivilate.
Startup Parade: Sal GainLife which has been building software to help disability insurers get better outcomes with workers who are out of work due to an injury. Founder Sean Eldridge and his team have gotten impressive traction with insurers. Here is Sean’s interview on this podcast, an episode called “Transforming Lives”: Interview with Sean Eldridge
Startup Parade: Meenta founded by Gabor Bethlendy and Stephan Smith is building Stripe for science, a workflow platform to make the notoriously inefficient process of scientific experimentation more efficient. Gabor was also on the podcast, here’s the interview with him: Interview with Gabor Bethlendy of Meenta
Doug Bates believes that angel investing requires a high level of understanding of the industry in which the startup is being built.
Powerball vs. Moneyball; Doug is a moneyball investor, i.e. he likes to take small, highly-analyzed bets that are likely to pay off consistently.
Marlene talked about Golden Seeds’ focus on portfolio companies having defensible businesses, i.e. businesses that cannot be easily copied by competitors. Golden Seeds also needs validation from pilot programs or repeat sales.
Golden Seeds looks for teams that are coachable and resilient. They liked big markets.
Each big Golden Seeds chapter sees three pitches per month.
Office Hours is a great way to connect with Golden Seeds if you don’t have connections.
Sal asks for your review on iTunes to help the Angel Invest Boston podcast found by listeners.
Doug and Marlene tell us the best ways founders can connect with angel investors.
Sal on the proper way to use LinkedIn to connect with angel investors. Hint: it does not involve sending mass emails to people you don’t know.
Resources for founders raising money; start with The Capital Network, a non-profit dedicated to supporting founders.
Marlene says keep pitch decks crisp and to the point. Less is more.
Doug says pitch decks should address greed or fear. Don’t go into the weeds.
Marlene adds that they have to explain how the product works in layman’s terms.
Sal recalls Joe Caruso urging founders to make sure angels listening to their pitches understand what the company does. Here’s Sal’s interview with Joes Caruso, the CEO Whisperer: Interview with Super Angel Joe Caruso
Doug: the most important subtext of due diligence is that it’s all about evaluating the founding team.
Doug: the golden mean between dogmatism and lack of conviction.
Founders should understand that Golden Seeds has a process; no on-the-spot answers.
Doug urges frequent communications with investors. Monthly is good.
Sal urges founders to occupy investor mindshare with monthly reports.
Jake Kayser of YourAgora asks questions about how angels invest directly or through entities.
Paul Livingston, Ph.D. of EdTech Advisory Group ask questions about how investors view educational tech companies.
Caleb, a senior at Babson, had a question about how to engage angels.
Davin, a Babson student asks for advice on having an entrepreneurial career.