One of the key pillars of GoBeyond is our global investor community. We have reached out to some of the members with a brief 10-question interview to understand the drivers behind their investments, their deal breakers and what they think are the next big trends. Here are the answers of Kate Ward, a GoBeyond member since 2013.
Kate has been an Angel Investor since 2012
Number of investments made: 40+
Number of exits: 7 exits, 3 of which were due to bankruptcy. Only two of these exits provided any sort of real profit.
Sectors Kate invests in: I’ve invested in ICT, health, medical, agriculture, fintech, and retail. I’m no longer picky about the sector, instead focusing on the founders and whether I think they have what it takes to deliver the product. I have so far avoided fintech.
Why did you get involved in angel investing?
I wanted to better understand the lifecycle of companies, as the accounting necessary to ensure their success, and the process of financing them until and after they become profitable.
What are the key things you look for in a startup?
Founders and CEO who have a strong grasp of the real problem they are trying to solve, and a keen understanding of the finances necessary to run and manage the company successfully. I especially look for the company to have a clear roadmap, with demonstration that they are remaining focused on delivery of the milestones on that roadmap.
What are your deal-breakers (red flags)?
Founders who are super arrogant about their product, and company leadership who do not take the questions from women seriously.
Your advice to novice Angel Investors
A few things I would say are:
- Start-ups need your experience and access to your relationships and network to be successful in the development and delivery of their product.
- Be careful about trusting your past experience in making decisions about which company to invest in. Your “expert” knowledge about how or what a company should or shouldn’t be doing may actually be a hindrance in your ability to make a good decision about the investment.
- Finally, be keenly aware that exits will likely take *many years* before they happen, and that your money will be locked away during that time.
Sectors to watch as an investor in 2021?
I feel that agriculture and transportation related investments would be a good place to invest in the 2021-22 timeframe. As the world recovers from COVID, everyone will start to spend the money they have not been spending in 2020. What they aren’t realizing though is that inflation is going to skyrocket across many economies, and that [affordable] food (especially the transportation thereof) will become critical as people increasingly focus their spending in the 2023+ timeframe on those things necessary to stay alive.
What do you predict 2021 will bring for early-stage investing?
I expect a few different things:
- I expect fintech to continue shifting how people manage their currency, pushing out older incumbents, and bringing in new ideas. I don’t believe that these new ideas will have the long-term revolutionary effect that many hope for them to have though. Incumbents are shifting quickly themselves, and the central banks of the world are actively working on digital currencies, which will eventually shift how people pay for things globally.
- I expect retail focused investments (e.g. clothing) to pick up in late-2021 or early-2022 as people want to spend their money, but I don’t believe these investments will be good long-term investments due to rapidly increasing inflation.
- I expect that US VC money will increasingly be invested in European and other non-US start-ups as the landscape in the US has become over funded. This will probably lead to a similar Ponsi scheme type of valuation of non-US start-ups just as it has in the US.
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