Essentially, along with a friend we are allocating some funds towards finding early seed start up ventures. For the past couple of years we have made ad-hoc investments via various crowd funding platforms. After a couple successes we decided that it would be worth it to try and source our own projects where we could take a bit more of an oversight approach and not pay the ridiculous fees that you find on the existing platforms.
Basically what we are looking to get involved in is projects that require between 0-5k gbp (although this is flexible) of start up funding to get the project going, and are projects that ultimately can run on a very low cost base but can generate cash flow relatively quickly. I personally think there are tons of projects that can be done online with limited funding, and will probably never be huge businesses, but they can achieve a fairly decent percentage return and relatively quickly. I have started several of these types of businesses back when i had time during university and so I know how easy some of these ideas are to execute, it just takes someone who has the time to actually run the day to day operations.
As I currently have very limited spare time, through this venture i am attempting to find people who want to start these kinds of projects but need some sort of funding to get it going. The idea is quite simple, we would be looking to take a non controlling equity stake in any project and in return provide the funding required. In addition to funding, we aim to add value to each project by bringing in a wealth of experience both in start ups and in general investing (approx 25 years of buyside/sellside experience between us), as well as a host of contacts across the finance industry.
The full process and what we are about is described here: Rubix Cube Ventues.com
and if you have any questions feel free to message me on here or via [email protected]
We will be looking to make our first investments probably near the end of February once the legal side of things is sorted, so want to start analyzing projects before then, so if anyone has a project they are looking for funding for, or know of someone then get in touch. We will be more actively sourcing projects end of this month but as I have been a member here for quite a while I felt the natural first step was to post this on here in the meantime.
Very cool stuff. I must say, you should expect the failure rate of these businesses to be massive. I believe (my opinion only). that the platform you have setup is tough. You will mostly get pitches from people who are pursuing their business part time and have little, maybe even no experience. Since you didn't mention anything about revenue requirements or operating processes, I'm assuming you are looking to invest in these companies in their early infancy (like instead of going to family and friends for start-up money, they will come to you). In my opinion there is too little upside on both ends. The creators are building a business for side income, and you are investing in small increments. The problem is, how much assistance are you willing to provide to protect such a small investment? Due to all of those circumstances, you sound more like an angel investor rather than a venture capitalist- and there is nothing wrong with that. I believe the return for angel investors is actually much higher. Creating a partnership with upper management is a tough thing to do when you have little investment to protect and there is minimal scalability while you have little skin in the game. The good thing is, you can always hit a home run off of something that comes across and than you made it! Looks like you know the direction you want to go with this, so stick with it and good luck! I look forward to hearing about the progress of your project!
I guess I am not looking at it through the usual viewpoint of an angel investor or VC who will make X investments, and hope a couple hit it really big. I am looking for those types of businesses that are not really designed to be huge businesses, I am looking for businesses that someone can run without doing it full time, and the cash flow will never be huge, but percentage wise should be decent enough to make it interesting. That is why in terms of sourcing I am looking mainly for university students who on their side they would benefit from some oversight/mentorship as well.
I know from experience that there are tons of opportunities and niches where people can generate some cash flow given a small amount of funding and effort, and which can ultimately be run without full time involvement.
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