1Mby1M Virtual Accelerator Investor Forum: With Dafina Toncheva of US Venture Partners (Part 3)

Sramana Mitra: I don’t know if you have seen it on our blog. We have a Thought Leaders in Cyber Security series. Ray has actually been on it. He’s running a company these days. In that series, one of the questions that comes up a lot is, if you put yourself in the shoes of a CISO, you have to make decisions about which vendors to work with.

There are hundreds of vendors coming in with hundreds of point solutions. It’s really a complicated job. Let’s say your portfolio company in security, it’s very difficult to get these meetings. How are your companies dealing with this? What are you advising your companies to do?

Dafina Toncheva: That’s a very good point. That goes back to me saying that there’re thousands of companies with a similar marketing message. >>>

1Mby1M Virtual Accelerator Investor Forum: With Alexander Ross of Illuminate Financial (Part 2)

Sramana Mitra: Can we do some examples?

Alexander Ross: Cloud Margin is a cloud-based capital management solution that I mentioned. It focuses on compliance, clearly, because it enables the end users to monitor transactions. Cost is also a factor. This solution is a multi-tenanted SaaS-based solution. It’s much cheaper to adopt as an organization and much cheaper to manage.

The cost comparison we see to the incumbents that are all deployed is a tenth of the price, which is significant. Compliance, cost, and capital are the three components that that particular solution touches on. Another example would be Privota. That’s a business that sits at the intersection of big data and cybersecurity. It sits on top of the new generation of data infrastructure. It enables differential privacy to the end user. >>>

1Mby1M Virtual Accelerator Investor Forum: With Dafina Toncheva of US Venture Partners (Part 2)

Sramana Mitra: One small detail question. One of the issues of the current venture capital ecosystem is that Series A financing has become larger. A class of VCs has developed that does the smaller Series A checks. Then you are doing the traditional venture capital. You want to put in $5 million to $10 million. If an entrepreneur just wants $5 million Series A, would you do that round fully as a solo investor?

Dafina Toncheva: Yes. I would love that. I think the appropriate amount of capital keeps everyone disciplined and makes them more focused on achieving milestones that will set the company up for success for the next round. We will definitely lead a Series A financing that is on the smaller side. We’ve led a Series A financing as small as $4 million.

These things have changed quite a bit. What used to be a traditional Series A now edges towards a large seed. What used to be the seed, now is >>>

1Mby1M Virtual Accelerator Investor Forum: With Alexander Ross of Illuminate Financial (Part 1)

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Alexander Ross was recorded in July 2018.

Alexander Ross, Founder at Illuminate Financial, talks about his firm’s FinTech investment thesis.

Sramana Mitra: Tell us a little bit about your fund and your investing focus. Let’s get to know one another. Let’s introduce you to our audience.

Alexander Ross: Our fund is called Illuminate Financial. We are a financial market technology-focused venture capital fund. We saw a space in >>>

1Mby1M Virtual Accelerator Investor Forum: With Dafina Toncheva of US Venture Partners (Part 1)

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Dafina Toncheva was recorded in August 2018.

Dafina Toncheva, Partner at US Venture Partners, is an expert in Cyber Security. We discussed a variety of topics including the shifting of Series A metrics to $2M – $3M ARR for SaaS companies.

Sramana Mitra: Tell us a bit about yourself as well as US Venture Partners. Where is the investment focus today? I know USVP has a long history of being in all different corners of the technology industry. >>>

1Mby1M Virtual Accelerator Investor Forum: With Waikit Lau (Part 4)

Waikit Lau: My advice is whether you’re a tech guy or business guy, find your soulmate in some place in business. If you are a business guy, find your counterpart on the tech side. If you’re a tech guy, find your counterpart in business. To me, you just need one other co-founder. This is where your past experience comes into play. Who have you worked well with that you can rely on? That’s really important.

There are two reasons why startups don’t make it. Number one is, they run out of money. Number two, is the founders give up. A lot of times, the root cause of founders giving up is that the founders just don’t get along. That’s really important. You’re going to spend more time with your co-founder than your spouse. It’s non-deterministic. Invest time in going out and networking. Meet people. Spend a few months working with people who excite you and see how that pans out. It’s important to test things out. >>>

1Mby1M Virtual Accelerator Investor Forum: With Waikit Lau (Part 3)

Sramana Mitra: What was the stage at which you got involved?

Waikit Lau: In this case, I was the third or the fourth check. I was very early. There was no lead. They had raised a little bit of angel money. I just said, “I like you guys so much. I like your team and technology. I will help you find a lead. I’ll write my check now.” For them, it’s very early.

Sramana Mitra: What’s very inspiring listening to you for this community is that we constantly see investors who are all wanting to come in after there is validation. When you’re developing complex technology, especially making some very serious technological breakthroughs, it’s not so easy to check all those boxes before going out to raise financing. You need financing to get to those checkpoints. >>>

1Mby1M Virtual Accelerator Investor Forum: With Waikit Lau (Part 2)

Sramana Mitra: Let’s talk a little bit about how you operate. If you put in $25,000 to $50,000, do you operate with a syndicate that would bring in the rest? Do you lead a syndicate? Do you follow into a syndicate?

Waikit Lau: It depends on what the entrepreneur wants and needs. They may say, “I’ve got no connections. I’m new to this, but I’ve got something really interesting.” I essentially help them either put together a syndicate where I run the syndicate or I introduce them to potential lead investors that I think would gel with them personality-wise. In a lot of cases, entrepreneurs already have their syndicates set or they have a lead investor. In which case, I’m just a follower. I’ll just write a check for myself.

In the cases where I have led or co-led, it runs the gamut. I have an AngelList syndicate where I’ve done deals where I run a few hundred thousand

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