Editor’s note: Startup Spotlight, which focuses on emerging entrepreneurial companies in North Carolina, is part of WRAL TechWire’s Startup Monday lineup.
RESEARCH TRIANGLE PARK – Entrepreneurs across North Carolina and points farther afield with a possible winner of an idea have a new source for investment: The RTP Angel Fund.
Announced last week, the fund brings many new investors into the realm of venture capital with veteran John Cambier serving as its administrator.
In an exclusive Q&A, Cambier talks in detail about the new fund:
New angel investor fund launches in Triangle with high-profile backers
- Why did you decide to create a new VC fund? What’s the mission?
The key members at RTP Capital decided that having a dedicated fund to invest out of would serve both the entrepreneurs and their members better.
For entrepreneurs, it removes a good amount of the ambiguity around how much money a group might be able to invest in their company if they get to “yes.”
With a “pass-the-hat” approach, there can be a great degree of variability in that number.
For angel investors, it provides automatic diversification at a (relatively) low entry point, and diversification is very important, especially at this early stage of investing.
For the leaders at Triangle Angel Partners, they were interested in potentially forming another fund, but thought that a model where it wasn’t entirely volunteer-driven had its advantages.
The mission is to deliver solid returns, supporting the Triangle and NC entrepreneurial ecosystem, provide exposure to and education around early-stage investing to our members and to have fun.
- What makes this fund unique?
1) We can go early and write small checks. So, if they’re “only” raising $250k – $500k, our check size is a good match (though we expect to participate in larger rounds too).
2) We can lead as well as follow. With the early-stage investing experience we have around the table, we aren’t afraid to set terms and serve as the lead investors for companies that get us excited.
3) We’re a generalist fund, so we can look at things beyond just SaaS (CFC).
1) We provide a much lower entry point (minimum commitment) than any of the other local funds save Tweener.
2) As a member-managed fund, our investors have a vote on every dollar we invest and can participate in all phases of screening, due diligence and company support. This is very different from a GP/LP fund structure.
3) We provide engagement and community. With monthly in-person meetings, we provide a vehicle for our members to broaden their networks and engage with other interesting and successful people.
- Who are your “co-creators,” so to speak?
The idea grew out of a number of conversations between the leadership of TAP and RTP Capital and got serious last Fall. That’s when I got involved.
- How do you and your founders separate your dealings with startups for this fund vs. your work at your “home base”? How do you avoid conflicts of interests?
The main issue for all members of the fund is full disclosure. This goes for leadership, staff and members. [IDEA Fund Partners, where Cambier works] is well aware of my involvement with RTP Angel Fund and I feel clear with respect to what is a conflict and what is not.
- With Tweener Fund, Cofounders Capital and others is there really a lack of early-stage capital?
Per the above, our short answer would be “yes.”
IDEA Fund Partners, Oval Park and Venture South should be part of the conversation as well.
It’s better for the community and better for founders to have as many “shots on goal” as possible. Every fund is unique in its own way and what appeals to one might not appeal to another for reasons that aren’t fully objective. As far as the Triangle has come in the last 20 years, I don’t run into many (any) entrepreneurs who feel we have a surplus of true, early-stage capital sloshing around. I don’t worry about the opportunity set or being “crowded out” by one of the other existing firms.
- Who are some of the 50 investors in the fund that you can disclose and who might be well known to the region’s tech community? What were some of the reasons they told you they would invest and support the fund?
My cofounders are all listed on the website. Many of the members in the fund are new to angel investing. They are interested in getting exposed to interesting companies and compelling founders, learning more about early-stage investing, building community and making money.