is there a list of pre-seed venture capital firms?
where can i find such a list?
If you personally know of some of these firms (pre-seed stage only), please list them below?
i have an idea for a community platform tech company (similar to AirBnB, but not a competitor) and am looking for a VC fund for pre-seed stage capital. I have not been able to find any company doing what i plan on doing...but there is a huge market that a platform like AirBnB could fit into and disrupt a pre-existing market with practically no tech alternatves.
I know that Sequoia invested 600k into AirBnB just after YCombinator...and i plan on applying to YC (and maybe 500 startups incubator also)...but in the meantime, i'd also like to explore other pre-seed investors (no guarantee on getting into these incubators)...but i don't know where to find them.
How much are you raising?
honestly...i'm not sure. here is where i'm at.
i had a life experience that was a pain point...wished there was an AirBnB type platform (peer to peer) solution for my pain point, searched for it...but it doesn't exist. There is an institutional alternative (the Marriot / Hilton hotel equiv to AirBnB) but no peer-to-peer marketplace equivalent...and the institutionl equiv sucks....nobody likes it, but there is no AirBnB type alternative. So i thought, "this would be a great idea for a company"...i did a little market research...put out a few surveys online to see if people would be interested in both the supply and demand side...and got a pretty good response (65% of survey respondents said they would use this platform if it existed...and the population i'm targeting is about 40 million people).
1% of my target population as users would generate ~750mm-1bln annual revenue. Its a pretty cool angle on the market that i'm surprised nobody has tapped into.
So, back to where i am now....i'm a programmer, but not a web developer, so i'm learning the web dev tech needed to build this myself (Javascript, etc..). Just going thru all the work that would be needed....assuming i learn all the tech...it will take me over a year to build this website myself (essentially replicating the AirBnB website with all their functionality...but for a different market that does not compete with AirBnB) and that does not include the mobile app, which would also be necessary (needed for the peer-to-peer messaging to be seamless and convenient).
So, how much would i need to raise to build from scratch the AirBnB website and mobile app? I'm guessing ~600k - 1.5mm
AirBnB raised 600k from sequoia as their initial seed raise, i'm guessing for about 10%
Since i'm just a guy with an idea, obviously nobody is going to give me that 600k for 10% right now. Assuming i spend the next 6-12 months building the website to get to MVP stage and have some users, both on the supply and demand side....something akin to the AirBnB hosts (supply) and guests(demand).
Similar to AirBnB, it will take some years before this hits growth stage....but the market is huge, and i can see a number of ways of ceating additional revenue streams from the platform. anyway, that's getting ahead of myself.
So, how much am i raising? Just like AirBnB, i'll need to raise a lot of cash over time (a few million to complete the tech stack, and then millions ongoing for admin / customer support). I'd like to just follow the AirBnB path...both from $$ raise, and from valuation...but i know that all depends on growth and adoption.
So, tldr; i'd like to raise 600k for 10%
Angel Investors and your parents. That’s it, that’s the list
I've worked in early stage VC, and it's very difficult to get a check from an institutional investo without an actualy product or traction unless you have previous successful entrepreneruship exprience or if you have unbelievable domain expertise in the space your company is working in that gives you an unfair advantage over potential entrants/competitors. Without those, it will almost be impossible to get a check from an institutional investor. If you're a student, I'd rec looking into Dorm Room Fund or Contrary Capital who may be more willing to write a check, albeit a smaller one, to a student startup with less traction
Once i have traction, then yeah, the typical VC firms would be interested, but then the check sizes would be larger, and so would the valuation.
Sounds like exciting stuff. Are you currently working full-time? Are you willing to either (a) keep this as a side project for the time being or (b) leave your job to do this full-time while living off of savings?
I feel like $600K is a reach for where you're at. Maybe try bootstrapping until you get an MVP, or at most, raising $250K from friends, family and angels. What would you actually need to spend money on in the next 6-12 months?
right now i'm going thru github libraries trying to see how much i can copy and repurpose with minimal mods.
for now, this is a side project...i need to work on my dayjob if i don't get funding.
For example, YCombinator would write a 125k check for about 6% of the equity....and that is essentially just paying the founder a salary to just work on this thing for 1 year. I could try to do that....but realistically, i'm still going to need to hire developers to build out the platform to the point where it is easy to use for customers (and my customers are not the most tech savvy, so the website experience needs to be easy).
I've found a couple very early stage pre-seed vc funds that might be interested, but only a few...tho i've read there are over 100...i cannot find them.
You could look into VCs and angel groups in your nearest metropolitan areas and college towns. One connection can quickly snowball into getting names of other organizations. Everyone in VC knows each other, at least in the same geography. It should be pretty easy to get a comprehensive list of people and firms that could help.
DM me! I work for a fund that looks at a lot of pre-seed investments, and am always willing to make recommendations to other firms if they might be a better fit.
its hard to believe there is not a publicly available list somewhere?
don't these micro pre-seed VC funds want to be found?
why is this so hard to find?
Be the change... if your business plan falls through maybe you can recoup some costs via ad revenue
so, after spending a few hours researching "AirBnB clone" i've found a bunch of promising software solutions that claim to create a clone of the airbnb tech stack (website, database, mobile app)....this is interesting
Good luck - keep us posted, man!
One name to check out is Brooklyn Bridge Ventures if you’re based in NYC. The $600k might be a stretch for them alone, but from what I understand they do pre-seed investing
This is a close approximation of what you need: https://www.docsend.com/index/active-vc-list/
What’s your background as an entrepreneur/ or building early stage companies / working at early stage companies
What’s your area of expertise in this specific industry
Who do you know in the target industry / what is your core team to help initially build out the MVP
PM the idea if I like it enough maybe I will take a bite of the 600k in a few months or the whole thing if I'm blown away
FYI no institutional investor will fund a "side project" even if it's before a MVP or market fit has been established, so be ready to quit your job if you're asking for outside capital (ideally have already done so and grinding 24/7 to make the idea real)
i spent 6 years as a software developer inside 3 investment banks working on various projects (front end software, database projects, various functional libraries), a couple years as a desk analyst / quant on a trading desk, and then over 6 years as a rates trader (been out of the business for a few years now).
i worked at a scrappy startup when i was in college as a software / web developer (i was 1 of 3), but that was a long time ago.
my specific experience in this particular industry is as a user...sortof...the exact business model that i'm building doesn't exist...similar to how AirBnB created a new industry...hotels existsed, but there was no peer-to-peer hotel industry....there are a lot of parallels, the analogy is very similar, which is why i keep referencing AirBnB. i've had to acquire and manage the "product" for family members (sortof...remember, this doesn't really exist yet). I really do think this will be a parallel to AirBnB...a peer-to-peer marketplace...an underutilized asset...and users who will pay for access (are currently paying more for an often inferior more expensive "professional" substitute)
as a programmer, i feel comfortable building most of the tech stack myself (its pretty cool how much of the generic software has been cloned already...so that's exciting for me...will make this much easier)...however, on my own will still take a long time.
this will be my first time as an entrepreneur/owner (being a trader running a book had some similarities, but obviously..not the same)
Lets say i were to get 1.5mm from some VC...i know that hiring 2-3 developers would speed up the tech stack...but...hiring and trusting new people is hard to comprehend, as i've always been a 1 man show..so that will be a hurdle to overcome.
Step 2, after i get past the MVP is getting users. nobody knows this will exist...nobody knows to search for it. How did the 1st people learn about AirBnB? People don't goto craigslist for my product/service...its more local and community based. Facebook and Insta ads maybe...but i'm pretty sure i'll need to produce actual TV commercials, and that's expensive. When i searched for something like it i turned to google search...so i think that is a natural place to start....but again advertising is expensive.
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