Hi York Angels, Let’s not nickel and dime Canadian entrepreneurs…
by matt roberts
Hi York Angels,
My name is Matt Roberts and we have a lot of things in common.
We’re both investing in Canadian entrepreneurs. We’ve both put our hard earned money on the line. We both like to think we’re mostly a help rather than a hindrance to building great companies.
You might think we do things a lot differently as I work in Venture Capital and you’re in an Angel group. That’s true, but on a more personal level I’d disagree as I have been an Angel.
I’ve invested in around 12 companies directly or more if you include my family’s investments that I help manage. Since I started in my current role I no longer invest directly (conflicts and all) but I still advise young companies, I truly love that aspect of my life.
I’m a former entrepreneur, though I’m not sure how you can ever not be entrepreneurial. Many of the people in your group have also started their own firms or companies.
I’ve also raised money for startups, something you guys also help with – its hard work to get a seed round or a Series A – much tougher than most people would know unless they’ve tried. If you can help with that you’re a huge contributor to the success of a company.
We both advise startups or aspiring entrepreneurs. I like to think I bring a lot to the table, people say I do – but maybe they’re being nice, I’m sure your networks and experience are also helpful when investing or advising an entrepreneur.
So, as you can see, I think on the important points we have a lot in common.
I know Venture Capitalists are ragged on. I’ve done it (and sometimes still do) and I understand the frustration. So with that in mind I’d like to point out that York Angels is beginning to be spoken about with some of the same complaints. Are these fair, perhaps not. But we in the venture community do our best to listen to criticisms and either articulate why we disagree with them or respond to fix them, occasionally they don’t even deserve a response. But we do it anyways, I think it’s just good karma.
Here’s some advice.
You shouldn’t charge entrepreneurs to pitch to your network or submit a business plan. I know some other groups have done it in the past, but I thought we’d gotten past this in our particular corner of the universe. I’d encourage anyone hoping to raise money from you guys to refuse to pay these ‘fees’ or just avoid your group until you change the policy. I’d also drop you from any recommended source of funds if I ever maintained such a wirtten list, right now its in my head but you’re off it.
I don’t see what value your group gets or gives from such a miniscule amount of money and I know for the entrepreneur its a red flag. Why you thought this was a good idea is beyond me. What’s probably more galling is that your group gets money from both a local government sponsored OCE and from Fed-dev… which means you’re charging entrepreneurs AND taking government money under the guise of investing in those same entrepreneurs – seems a bit off side.
I know you try and add value with more services for entrepreneurs including a $200 course to help them pitch to angel groups. These services are also provided by local Centre’s of Excellence suchas OCRI, Communitech, TechAlliance & MARS (etc) so I can’t think why you should offer a similar service for money. I’d encourage you to do this for free, refer potential opportunities to the previsouly mentioned groups or direct people to the online advice out there you agree with.
The truth is every pitch or business plan is a learning experience for all involved – even if an investment is never done. You’ll learn more about whats out there. Thats why on the front page of my website is essentially a sign up for office hours, any entreprneur can ask for 20 minutes of my time. I don’t charge money.
You guys have done some great investments in companies I’ve advised or might invest in one day and added some great value to your companies. With all the people out there pulling for startups in Canada lets kill the nickel and diming.
- As always what is written here is my opinon and does not necessarily reflect the views of my employer, my coworkers, Janet (the lunch lady), my parents, my friends, or someone in any position that may call and complain to me. If you would like to complain to someone you think has power over me I can provide my mom’s email upon request. -