Dear Startup Investor,
We’ve been working on this next recommendation for a while.
It took some doing, but we’ve arranged a unique opportunity for you to invest alongside Barbara Corcoran Venture Partners (BCVP).
It’s an early-stage fund with a $10,000 minimum investment. For $10,000, you’ll get access to equity in 10 to 20 startups in the form of a fund specially created for Startup Investor members. If you want to invest more, your stake in each startup will increase.
BCVP is a venture capital group founded by Barbara Corcoran, the well-known star of ABC’s hit show Shark Tank. Her co-founder is veteran early-stage investor Phil Nadel (who spoke at our conference last week in San Francisco).
I met Phil through AngelList, where we had invested in a few of the same deals. As it turned out, we have some shared connections.
Over time, I came to value his judgement. And eventually I invested in four of BCVP’s deals with my own money (for a primer on how AngelList online investments work, read this).
I can tell you firsthand the quality is there with BCVP. I’ve told Phil that he and Barbara have a knack for finding growth-stage companies at early-stage prices. In other words, they find bargains with big potential.
To get an idea of the caliber of deals BCVP brings to the table, here are the four that I invested in through their AngelList syndicate.
Wanderu– Orbitz/Priceline for bus and train travel
Deal closed: November 2014
Wanderu’s Web and mobile app allows anyone to search for bus and train travel across multiple transportation providers at once.
I can’t give many details, but they’re doing very well and expanding internationally.
Ground travel is the fastest-growing means of transport in the U.S. among young people.
Below you’ll see Wanderu founder Polina Raygorodskaya with Richard Branson in February 2015.
The picture is part of a February 2015 CNN piece on Wanderu, titled “Is this Richard Branson’s next investment?”
Here’s more coverage on Wanderu in The Economist.
GULLIVER is an evangelist for Kayak.com, the travel search site that Priceline bought for $2.1 billion in 2013. Its simple, clean and intuitive interface made searching for a cheap flight or hotel room much easier, faster and more enjoyable than on its cluttered and confusing competitors.
Now a team of Boston-based entrepreneurs is aiming to do for intercity bus travel what that site did for plane tickets and hotel rooms. The company is called Wanderu, and its site looks a lot like Kayak’s.
… Wanderu solves that problem – it searches many of the most popular intercity bus services, including Bolt, Mega, Greyhound and Peter Pan.
A young company couldn’t ask for better coverage in such a well-respected magazine…
Check out Wanderu’s app on iOS and Android.
Wevorce– Divorce simplified
Deal closed: December 17, 2014
Wevorce is building a network of Wevorce divorce professionals who work with divorcees to minimize friction and fees involved in the legal process.
Recent media coverage on Wevorce from USA Today and others here, here and here.
The startup is doing well. But again, I can’t say much. It’s a private company.
Haystagg– Online advertising service with advanced targeting
Deal closed: March 2015
Haystagg is a fast-growing ad-tech company with a more effective way of targeting advertising. They’re young, fast-growing and have gobs of potential.
Mark Cuban joined Barbara and BCVP in this latest fundraising round. Coverage here.
Educents– Deal site for teachers
Deal closed: December 29, 2014
Teachers’ budgets are shrinking. Educents helps them get high-quality materials for class at low prices. The deal site is growing fast. Since the round led by BCVP, which I invested in, they’ve gone on to raise money at a higher valuation, from top-notch VCs including Kapor Capital (an Uber investor, first round).
The Fund
The investments above are just the four I’ve participated in personally. BCVP offered me and others the chance to invest early in these dynamic startups. Now you have a chance to invest in their next deals as part of this fund.
In addition, Andy and I have recommended two deals led by BCVP to Startup Investor members, including Underground Cellar, one of our favorite (and fastest-growing) picks. The other is Social Rewards, which is continuing to innovate in the mobile rewards area.
Unfortunately I wasn’t able to offer Startup Investor members the opportunity to invest in all these deals. Why? Complex legal issues that aren’t worth getting into here (Google “general solicitation” or “Reg D 506-C” if you’re curious and tolerant of legal jargon).
That’s why I reached out to BCVP about creating a fund – to offer our members access to all the best deals. And quite likely (if there’s enough capital), these funds could gain access to other great deals not available through BCVP’s traditional syndicate (which is crowded and capped at 99 investors per deal).
Either way, it’ll be a diversified investment in promising startups for $10K… alongside Barbara Corcoran and Phil Nadel.
$10K = Equity in 10 to 20 Startups
I’ve mentioned these deals to give you an idea of the types of companies you’ll have access to.
But you’re not investing in Wanderu and the rest of the bunch.
You’ll be investing in a new group of exciting early-stage companies. I shared the details above to demonstrate the high quality BCVP brings to the table.
Barbara and Phil have excellent “deal flow,” as it’s referred to in the industry. Lots of good early deals come their way. And they’re always looking for the next great investment.
More than that, BCVP offers significant “value add” to companies they invest in. Introductions, business advice, legal help, etc. As a startup, having a big name behind you opens many doors.
Here’s a quote about Phil from one of BCVP’s portfolio companies, Paintzen:
Phil has been a great backer and partner to my company, Paintzen. He brings years of experience to the table and we are lucky to have him as an investor in our company.
– Justin Geller
BCVP Fund for Startup Investor Members
The fund will invest in 10 to 20 startups as selected by Barbara and Phil.
You don’t get to know what companies you’re investing in ahead of time (you’ll know once the investment is signed and sealed and the money is delivered)…
Remember, private investing isn’t like buying a stock. You’re putting your trust in the fund managers. You put in the money first, then the managers invest it. That’s how venture capital funds operate.
I trust Barbara and Phil. I’ve watched their investments grow.
Deal Structure
The way this deal is set up, BCVP makes money on the investment only if you do. If there are profits, BCVP receives 15% of the gains. AngelList receives another 5% carry for managing the transaction.
They only make money when you do. And there are no management fees.
Steps to Invest
If you haven’t created an AngelList profile yet, register here.
You will be prompted to confirm that you’re an accredited investor and that you understand the risks involved in early-stage investments.
Then you can complete your investment via ACH transfer (similar to using a debit card) here: https://angel.co/barbara-corcoran-fund/fund.
You may be asked to provide proof of your accredited status. As a reminder, to meet the SEC’s definition of an “accredited investor,” you need to have a net worth of more than $1 million or have an income of at least $200,000 for the last two years ($300,000 for a couple).
Yes, there are small hoops to jump through to participate. I don’t think you’ll regret it if you put in the small amount of work required. And AngelList will provide any assistance you need in making the investment.
Investing in early-stage startups is risky, fun and potentially very profitable. I hope you join us on this one. It’s a special opportunity.
Note: Please consult an investment professional if you’re not sure about making early-stage investments.
We feel the relatively low minimum of $10,000, combined with diversification across an estimated 10 to 20 deals, minimizes risk. But these are still startup investments, and many companies fail at this stage. If there are gains, they may not appear for five to seven-plus years. Be prepared to hold your investments for extended periods, as there is typically no liquidity at this stage of investment. Invest only money you can afford to lose.
Good investing,
Adam Sharp
Startup Investor Portfolio
