Summit 2019 Introducing Ben Kepes
As a teaser for those of you attending The Runway and Angel Summit events in a couple of weeks time, Ben Kepes, an experienced angel investor who is speaking at both, has thrown down the gauntlet with a really neat articulation below of the conversations we look forward to having with you as we hunt down how to be effective, additive contributors to the businesses we are backing. You can read more of Ben’s other musings on the tech and startup scene here on his Diversity Blog.
Firstly a quick disclaimer: I, like most of you reading this, am an investor. As such, despite any hint of magnanimity in our decisions, our primary driver for investing in early-stage companies is to make money. If our aims were entirely philanthropic, we’d be giving to charity. We can wrap it up nicely and try and avoid the fact but angel investment, while having some good outcomes beyond dollars, is primarily a capitalistic drive.
That said, I wanted to take the opportunity to follow Suse’s lead in theming the upcoming Angel Association conference being held in Otautahi to add my two cents around the topic of expectations – those of us as investors, of our fearless entrepreneurs, and of the ecosystem as a whole.
The financial realities of angel investing in enterprises that fundamentally have a far greater chance of burning out than they do of success means that we do need to make a good return on those that are successful – if all we wanted to do was get rid of some excess cash, there are far more effective ways of doing so than being an angel investor.
But sometimes, in the search for good financial returns, we lose sight of the unique position we’re in as investors and the opportunities it brings us. We have the ability to shape a future on a number of levels – we can help have an impact on whether an entrepreneur’s journey is positive or not, we can encourage the development of businesses which benefit society more wisely than simply through wealth creation and, just maybe, we can vote with our wallets and help more planet-friendly businesses to bloom.
In terms of the “founder burnout” topic – we’ve seen much attention from the industry about this aspect of the startup journey. We’ve had some pretty raw admissions of the pain and angst that goes hand in hand with startup life. But, as the (purportedly) mature and experienced people in the relationship, our job is to navigate this road with a reasonable perspective. The fact of the matter is that for both entrepreneurs and investors to meet their objectives there is going to be a heap of hard work and painful moments – there’s no point sugar-coating that fact. But hard moments are different from bad behaviour or absence of empathy and that’s where we have work to do.
So I’d like to suggest as we spend our time in our roles as angels, that we think about what we and our investee companies can do differently. What is it that we can bring to the world that changes the conversation? What does exponential value creation mean beyond simply financial value?
In practice, what does a more empathetic approach towards angel investing look like? I’d suggest that it means we’re sometimes happy to achieve a good, short-term outcome that meets the needs of founders, employees and investors, society, the planet or any of the other myriad layers of stakeholders that exist in this world. How about we think about limiting the downstream hard times that come from aiming for the moon shot? It’s potentially about not going for the one in ten exits that need to generate 20x returns, but rather a greater number of more modest outcomes. It’s about being honest with ourselves, our leadership teams and our ecosystem about what is realistic. And it’s about finding a uniquely Kiwi way of doing angel investing.
Enjoy the journey!