Five years ago, super angel Ron Conway was “terrified” of investing in New York companies.He didn’t understand the scene there and was concerned that he wouldn’t be able to give companies the advice and help they needed. As a result, only 2% of his portfolio was based in New York.
Now, about 25% of the 300 active companies in SV Angel’s portfolio are based in New York. As he just told the audience at the Twilio Conference in San Francisco, “we think New York has built as good a tech ecosystem as the Bay Area.”
Here are a few other nuggets he shared with the audience of nearly 600 developers and partners:
- He used to be scared of mobile. Like New York companies, Conway used to avoid mobile investments because he was “terrified” of the “dinosaur” telcos. “I don’t have grey hair for nothing, I’m 60 years old, and have been investing since 1994 actively.” As with mobile, SV Angel used to have about 2% of its investments in mobile companies five years ago. Now, it’s about 25%, and it’s the fastest growing part of the portfolio.
- Don’t bother with a full business plan if you’re trying to get funded. He said that the days of investors reading 50–page business plans are long gone. Now, it’s more important to have a killer one-page executive summary.
- If you’ve got a face to face meeting with SV Angel, they’re probably going to invest. He called this one of his “secrets” — the company does lots of research before they ever agree to a meeting.
- His percentage of the companies he invests in is usually between 0.5% and 2%. By the time a successful company gets bought or goes public, it’s usually diluted so that his largest stake will be 0.5%. But he’s not interested in taking bigger stakes like traditional VCs: “Guess what — owning half a per cent of Google or Facebook or Twitter is just fine.”
- He compared Netflix to Airbnb. When asked about Netflix and the cable industry, Conway compared the problems they’re going through with the bad publicity AirBnb (one of his investments) ran into earlier this summer when a guest trashed a rental they got through the company. “It’s interesting that a company as old as Netflix is still learning….They will respond just like our company Airbnb did.” He also said that he thinks that Airbnb epitomizes the idea of “collaborative consumption,” where consumers get together and create a marketplace. He thinks that’s the next big thing.
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