Investing in Public
In the spirit of “building in public”, I’ll share occasional updates on my angel portfolio here. This is not investment advice, nor is it an offer or solicitation to buy or sell securities or anything else.
Overview
As of June 2023, I’ve angel invested in 31 companies.
7 companies have had definite outcomes: 1 substantial exit at ~40x, 3 exits that each returned ~1x, and 3 failures.
24 companies are “live”. Of these, there are 5 companies that I’m confident will each return at least 10x; there are 8 others that I am pessimistic about; and it’s too early to tell for the remaining 11.
As of June 2023, my angel investments have a blended IRR of 33%.
Funnel
My dealflow funnel over 2022 looked like this:
- Decks reviewed: 372
- First call: 53
- Deep dives: 31
- Second call: 15
- Final diligence: 10
- Investments: 6
My goal for 2023 is to see at least 500 companies, and hopefully make 6-8 investments.
Breakdowns
Here are some ways to break down my portfolio:
- Geography: 11 Canada, 11 global – but most teams are distributed
- Stage: 12 pre-seed, 10 seed
- Sector: 6 MAD stack, 3 infrastructure, 3 fintech, 3 SaaS, 7 other
- Demographics: 28 of 41 founders are from under-represented groups
(Note that this includes the 22 companies in cohorts II and III, but not the 9 companies in cohort I; see below.)
Performance
As of June 2023, my angel investments have a blended IRR of 33%.
My angel investing career has had several distinct phases. Combining them into a single portfolio isn’t as informative as breaking them into cohorts, which I do below. These cohorts analogize nicely to “traditional” venture fund cycles.
Cohort I: 2014 to 2017 (India)
I made my first arms-length angel investment in 2014, while running my own startup Quandl. Over the next 3 years I invested in 8 more companies. These were all small cheques into India-based startups, about half direct and half via syndicate. I didn’t follow any systematic strategy for selection or portfolio construction; this was a very ad hoc portfolio.
- Companies: 9
- Cheques: 14
- TVPI: 5.7
- DPI: 3.6
- IRR: 37%
Key learnings: power law outcomes; pay attention to deal mechanics; DPI is more important than MOIC or IRR.
Cohort II: 2019 to 2021 (global)
Between 2019 and 2021 I wrote 22 cheques into 14 companies, while running Quandl post its acquistion by Nasdaq. These were slightly larger cheques, but with a different geographical focus than cohort I: Canada, the US and Europe. These investments were somewhat ad hoc initially, but got more intentional towards the end.
- Companies: 14
- Cheques: 22
- TVPI: 1.7
- DPI: 0.1
- IRR: 32%
Key learnings: entry price matters; avoid both fomo and value investing; consensus decisions lead to mediocre outcomes.
Cohort III: 2022 to present (global)
Starting in 2022, I became more intentional about angel investing; this coincided with my moving on from Quandl and Nasdaq. I now have a tighter thesis, portfolio model, and dealflow channels.
- Companies: 8
- Cheques: 9
- TVPI: 1.3
- DPI: 0.0
- IRR: 33%
Key learnings: differentiation matters; tech beats hype; reason from first principles; trust your judgement.