Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Deb Kemper was recorded in May 2018.
Deb Kemper is Managing Director and Chair of the Boston Forum at Golden Seeds, an Angel Group and Micro VC focused exclusively on women entrepreneurs.
Sramana Mitra: Let’s start by introducing our audience to yourself as well as to the investment thesis and focus of Golden Seeds.
Deb Kemper: I am what’s called an angel investor and that is what Golden Seeds is. Golden Seeds is a hybrid angel network and small micro-VC fund. The angel network has around 300 members across the United States. We primarily invest in companies that have a woman on the founding team.
It doesn’t have to be a majority female-owned company but it has to have a woman in the C-suite with, at least, 10% equity. The reason we do that is, this is a group of people that have been historically underfunded in the VC market receiving less than 3% to 5% of venture capital. We’re just trying to get to parity. We feel that there’s positive and above-market returns in trying to do that.
Sramana Metra: What check sizes do you like to write?
Deb Kemper: Our check sizes vary whether or not we lead a deal. On average, we’re looking for companies that are looking to raise between half a million and several million dollars. On the upper side of that, we would normally be syndicating with other angel groups or smaller micro-VC’s.
Sramana Mitra: How big is the micro-VC portion of your activity?
Deb Kemper: Golden Seeds has a fund that has about $30 million under management. These days, it seems like a smaller VC fund when they’re raising upwards of a hundred million dollars these days.
Sramana Mitra: This is part of the shift that is happening in the early stage venture capital ecosystem. There are now 700 plus micro-VCs in the market. That part of the ecosystem has a lot of liquidity. It has become very complicated to understand who wants to invest in what stage of validation. There is pre-seed. There is seed.
What stage of validation qualifies as seed? Everything is moving upstream in terms of how much validation is required to raise money these days.
Deb Kemper: That’s very true. It’s one reason why we like having the affiliated fund. There’re more micro-VCs but you still need to have the runway to get to what used to be a Series B, which is now what we call a Series A.
Sramana Mitra: You could be in a situation where your angel group funds a pre-seed or a seed and then others come in with post-seed or pre-Series A?
Deb Kemper: That could happen. The angels like to go in a bit earlier than traditional funds.
Sramana Mitra: Let’s talk about that. What is the level of validation that your angels are looking for? Are we talking pre-seed? Are we talking seed? What kinds of metrics are you looking for?
Deb Kemper: I always say it varies. We have some investors who really like to go in early. They might be willing to go in before you have customers and you might be working to develop your minimum viable product. There are more angels who want to come in once you have a clear product-market fit. With a wide variety of angels in our network, you have a variety. It’s a bell curve. There are some who like to go early and there are some who are more risk averse.