Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Kelly Perdew was recorded in June 2018.
Kelly Perdew is Co-founder and Managing General Partner at Moonshots Capital, a firm that has a unique investment thesis of supporting military veterans. Very interesting insights.
Sramana Mitra: Let’s start by having you share a little bit about your background as well as the background of your fund. What is the investing focus? How big is the fund? What kind of investments are you making?
Kelly Perdew: I’m a relatively new venture capitalist. I started as an entrepreneur. I’ve been either a co-founder or part of the senior team of 10 different companies that we started. Two of them were learning experiences, five were exits, and three are still operating profitably. I do consider myself as an entrepreneur. Along the way, I started making angel investments. Along with my partner in the fund now, we started angel investing together.
Then we started leading angel syndicates. We would invest our money and tell other angels about it. They would invest with us so we would get paid a carry. Last October, we closed a $40 million fund. We made investments in 65 companies over the years and have a pretty spectacular track record. We think we’re pretty good at picking the companies. We’re even better at helping them after we put the money in. Our thesis is focus almost entirely around leadership.
My partner and I both graduated from West Point. We served in the military. It’s the only place we know where millions of dollars is spent training people specifically on leadership. If you look at the success record of the 65 companies we’ve invested in and all the other VCs that we sit on board with, the key ingredient is leadership. Moonshots Capital leans in heavily when there’s a military veteran on the founding team. That could be any military; it’s not just US military. We also like, as a lot of other investors do, founders who have had previous successes in building companies.
Sramana Mitra: These 65 companies that you’ve invested in, what percentage of those have a military veteran in their founding team?
Kelly Perdew: We have just under $15 million assets under management that has been deployed. About 70% of that has been invested in teams that have a military veteran as one of the co-founders.
Sramana Mitra: Very interesting. What is the typical check size of what you invest in?
Kelly Perdew: We’re late seed to early A. That can mean a lot of things in different parts of the world. Over the last three to four years, things have gotten a lot more elastic in terms of what that means. Our check sizes are typically $500,000 to $800,000. We’re frequently the first institutional investors.
We’re not the first investor. We look at companies that have started generating revenue and approaching $50,000 to $100,000 a month in recurring revenue. We’re looking to get anywhere from 10% to 15% ownership in that seed round. Of the $40 million, $17 million is dedicated to first checks and $23 million is reserved to reinvest.