1Mby1M Virtual Accelerator Investor Forum: With Deb Kemper of Golden Seeds (Part 4)

Sramana Mitra: I am completely in agreement with you. I really think that there should be a large pool of investors that are not unicorn hunters but who operate within the equity investing framework that we use in our ecosystem and may have successful investments. We need more of those. It’s unfortunate to see this mania. It makes me feel that we’re going to see lots of unnecessary failures where some of this money could have been channeled better.

Deb Kemper: It’s also a function of fund economics. If you have a $30 million fund and you get a $60 million exit, you’ve paid back your fund. If I have a billion dollar fund, I need a billion dollar plus exit to return.

Sramana Mitra: That is a different business. That’s almost private equity. If you have a billion dollar fund, you have >>>

1Mby1M Virtual Accelerator Investor Forum: With Deb Kemper of Golden Seeds (Part 3)

Sramana Mitra: What stage did you get involved in either of these companies?

Deb Kemper: For both of them, Golden Seeds was in their initial seed financing round. On one, I was on the seed. On another, I got in a little bit later. I didn’t invest the first time it came around.

Sramana Mitra: Did your micro-VC also invest in these companies?

Deb Kemper: It did in one of them.

Sramana Mitra: I’m listening to you about the second company where you already got an exit within 18 months >>>

1Mby1M Virtual Accelerator Investor Forum: With SC Moatti of Mighty Capital (Part 6)

Sramana Mitra: You are preaching to the choir. It’s exactly our philosophy. We have a very clear philosophy of bootstrapping first and raising money later. We don’t take any equity. We are the largest virtual accelerator and we don’t take equity because I don’t believe you should be taking equity as an incubator or accelerator.

If you are an accelerator fund like YCombinator, they do have great ecosystems. That’s different. The vast majority of accelerators actually don’t add much value. They take away a lot of equity. Exactly the scenario that you described happens.

Our preference and our advice is not to raise too much money, do not try to go through these drib drab financing. >>>

1Mby1M Virtual Accelerator Investor Forum: With Deb Kemper of Golden Seeds (Part 2)

Sramana Mitra: What is the earliest stage at which they would go in? Would people go in with no product and just a concept?

Deb Kemper: People would go in before validated product market fit. It’s between the concept and having that. At least a beta. We rarely go in on an alpha stage. We like to see people figuring out a way to do that initial build out. We’d come in at the beta where there’s clear testing you’re trying to do.

There’s clear stage-gating of what’s going to happen and things that will be learned from that. It’s also very different. We’re sector-agnostic. Since we’re focused on the gender diversity question, we try not to limit too much on the technology and sectors that we look >>>

1Mby1M Virtual Accelerator Investor Forum: With SC Moatti of Mighty Capital (Part 5)

Sramana Mitra: The corollary of our previous saying is that VCs love to come to the rescue of victory. That is also a very popular saying in our community.

SC Moatti: It’s a very interesting point that you mentioned. What you’re saying is the traditional VC industry has whales and minnows. Some people are here just for the show. Some people are coming in and taking over victory. I would say that I tend to agree. The traditional industry has its faults.

The reason I talk about the dolphins is that this is something that we are trying to change. There are all the dolphins out there who are >>>

1Mby1M Virtual Accelerator Investor Forum: With Deb Kemper of Golden Seeds (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 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 >>>

1Mby1M Virtual Accelerator Investor Forum: With SC Moatti of Mighty Capital (Part 4)

Sramana Mitra: Why do you want minnows on the cap table?

SC Moatti: Sometimes, you need them because they will help you early on. They will help you get started.

Sramana Mitra: Then they don’t fall in the minnow category. If they’re passive investors, you don’t want them but if they add value, they’re not passive investors.

SC Moatti: You have a good point here, but sometimes to get things started, you will need to have some of those on your cap table. You may not want them, just like you may not want to do the grind every day, but then there is reality. You need to make some >>>

1Mby1M Virtual Accelerator Investor Forum: With Suresh Shanmugham of Saama Capital (Part 5)

Sramana Mitra: The story that needs to come together for the ecosystem to get the next level of boost is that there are a lot of acquisitions happening. Even here, the vast majority of exits are M&A exits. It’s not IPOs. IPOs happen but not that many. The strategic acquisition story just needs to come together for everything to flow. It’s good. It’s a massive journey for the last 10 years.

I started working on the Indian ecosystem and trying to shepherd or promote the Indian ecosystem back in 2005 through my blog. We started One Million by One Million in 2010. India has always been one of our biggest geographies. It has been a really interesting journey. Our roundtables are continuously full of Indian entrepreneurs. More and more, everybody is generating revenues. That’s the first step. If you can generate revenues, a lot of other things can be worked out. >>>