Thinking about deals

InvestingI have been spending a lot of time in my head these days thinking about the deals I am in, the deals in the pipeline and what kind of companies we will see in the next couple of years. 

No surprises that we spend a lot of time talking about the future in our house.  Fred gave a talk at Le Web last week which is worth watching.  He spoke about what the next ten years will bring in regards to the investments that his company, USV is talking about. 

When I think about the deals I am in and the decision I made to be in them I think about the past (when I made the investment) and the future in regards to jumping in at the right time and place to move forward.  I am far from a passive investor and so I do need to have a connection with the person I am investing in.  I sometimes think I am betting on an incredible jockey that happens to be riding a fantastic horse. 

There are more than a handful of companies that I am invested in where I gave them their first dollar.  It is bold to do that without any conversation with a group of partners but to be solo.  I have certainly figured out how to be solo while building a wonderful group of strategic investors that I work with in the angel arena including the VC's at all different levels who do early stage and later stage.  It has worked for me.  Yet there are definitely some times where I think I am out of my mind investing in all the companies so early.  Then there are the days when I have a bunch of amazing meetings with companies I am invested in and think wow I am so psyched that I jumped in on this deal.  I love this entrepreneur. 

It is all part of the investment roller coaster.  Exhilarating, intellectually challenging, crazy and exhausting.  I guess that is how I like it. 

This past year has been a turning point.  I lost a company and through that experience I learned a tremendous amount.  It is painful fo lose a company that you believed in but unfortunately it is a part of the risk one takes when investing early.  I also had a big exit which was exhilarating and wonderful for everyone involved.  I am kind of sad not to spend time with that company anymore but again that is part of the world I live in.

There will be lots of changes in the start-up world in the next year.  Money is changing hands as more angels come into the arena.  There are more companies being started in every single vertical and we are seeing investors put money into areas that they never thought they would before.  Technology companies that have a bend towards a medical platform.  They are companies that have a life science and medical component but they really have a technology foundation so investors who would not usually go into this space find themselves comfortable in it.  We will probably see more large companies buying smaller companies who are nimble and provide something that the large company needs but could never build themselves. 

This time of the year is a good time to reflect about the past and think about the future.  Investing in start-ups is all about the future and as I close up a the year )with a few in the pipeline) I am really looking forward to 2014.

Comments (Archived):

  1. Ella Dyer

    Dear Joanne,As always, your thoughts reflect what many may feel (sadness, exhilaration, ect.) as we look back but also to the future. As an entrepreneur/investor myself, it’s good to know someone with your experiences and successes, shares some of the feelings I’ve had (just this year alone).Here’s to a fruitful 2014 with many more women leading the way,Ella

    1. Gotham Gal

      more women!

  2. William Mougayar

    You are living on the edge of the investment wedge 🙂

  3. steve ganis

    Always enjoy your blog. I had read in NYTimes a month ago your involvement with that Bushwick co-share venture, I thought it would be case study grist for you to explore what can go wrong with something that seemed so right, and your ability to bring HNW experienced investors with you. Maybe a blog post in 2014. Also, I happen to be a veteran professional service provider in nearby NYC CT ‘burbs, and former brownstone Bklyn NYer, I’m always curious when I read your sentences like “tech companies that have a bend toward medical platform.” Don’t see many of those tech companies around here in FairCounty…or angels willing to be first dollar in to new ventures…or experienced folks seeking encore careers in something other than buying a franchise or e-commerce biz in the basement. From what I read in A VC and your column, probably more going on in just DUMBO and Bkyn Navy Yard than in all of CT.

    1. Gotham Gal

      will be writing about all of them in the new year.

      1. steve ganis

        Great, will be reading! CT: one of oldest population in U.S, no growth in manufacturing… My SW CT/FairCo: limited growth in financial services, 20% plus office vacancy…”fledgling” innovation economy, some co-share spaces, no research university, G’wich angels tend to be more involved in NYC opportunities than CT.

  4. Lisa Abeyta

    Your comment about being sad about not spending time with a company anymore reminded me of the lawyer who offered free space in his office to my husband and his cofounders 20 years ago when they were launching their first company. He was friends with one of older cofounders and was traveling internationally so thought it a good way to help his friends get started. He was also one of their first investors. When that company made a successful exit, it wasn’t the end of his relationship with the team. He invested in their next startup, in mine and invested again when our companies became one this past year. He is our chairman of the board – and, as he is now semi-retired, he has a free office he uses in our space – a wonderful kind of full circle for all of us. He has become investor, mentor, legal counsel and personal friend.I imagine that with some investments you’ve made, you’ll find that, with time, a new opportunity will come around to work with at least some of the team in a new venture or capacity. Good relationships with people you can trust are too valuable to just end because a venture ends.

    1. Gotham Gal

      so true. good relationships with smart people that you trust are not to be taken for granted.

  5. falicon

    Perhaps it’s not the right approach or way to think about it, but I always want people to love and believe in the company (or more specifically the mission behind the company) than they do me (the entrepreneur).Of course I want to be liked and I think I bring a lot of unique qualities to the table for the specific things I’m building…but it’s not about *me* winning, I think it’s about us solving the bigger problems together…

    1. Gotham Gal

      i totally agree. we all have to believe

  6. Erin Newkirk

    “I sometimes think I am betting on an incredible jockey that happens to be riding a fantastic horse.”That makes you a trainer. Feels right!