The Seedfunders Podcast: Recent Episodes
Seedfunders
Seedfunders is Florida's leading early stage investment group. A growing network of angel investors with hubs in 3 cities, Seedfunders delivers capital and connections to the leading companies of tomorrow. The Seedfunders podcast covers all aspects of seed funding, from the general to the nuances. Founder Dave Chitester shares his extensive experience and insight in conversation with host Joe Hamilton and guests.
This long Covid pandemic not only reshuffled the deck for many of us, it flung the deck up into the air and torched it like one of those fire breathers at the circus. But it's long been known that game changing societal events bring game changing opportunity. Accordingly the last year saw startups thrive, hibernate and throw in the towel. In this episode Dave runs us through the Seedfunders portfolio, and startup investments in general, to see who has built up an immunity and who had to get a note from their doctor.
'If you believe that, I've got some swamp land in Florida I'd love to sell you." That round about way of calling someone gullible actually has a pretty nefarious history. For decades, unscrupulous hucksters sold Florida swamp land, Brooklyn Bridges and timeshares on the moon to unwitting buyers. The government stepped in and created rules to help protect investors from being ripped off. That was tough to accomplish on a deal by deal basis, so the protection was built around the investor - the assumption being that if you were worth a good amount of money, you probably knew what you were doing. Thus the concept of being accredited was born.
In the last few years, that protection has started to do more harm than good. The internet has made buyers savvier and startups desire access to the investment dollars held by the masses. The SEC has listened and has developed new regulations that open investing up to all. In this episode, Dave walks us through these revolutionary changes.
The Yogi-isms could not be contained to one episode, so we made it a double header. In today's episode, we continue studying the unintentional startup wisdom contained in Yogi's cryptic quotes.
Yogi Berra was one of the greatest catchers in baseball history. He won 3 MVPs and 10 World Series. He lead multiple teams to the World Series as a coach. He was pretty awesome on the field, but is perhaps even more famous for his Yogi-isms. They might not make sense at first. They might make your head hurt. They might lead you to unexpected insight, and that's exactly what happened to Dave. He realized that many of Yogi's sayings applied well to startups. In this episode we run through a few of Yogi's best to see what lessons they have for founders and investors.
Dave has officially gone bionic. While I wouldn't dare race him, I will gladly listen to his latest insights on the med-tech space. That's exactly what we do in this episode.
Dave started both of the major investing vehicles in Tampa Bay: Florida Funders and SeedFunders. Between the two, he's reviewed thousands of companies and seen them bloom and bust. In this episode Dave shares how those experiences have shaped his investment decision making. And there's no better way to make the wisdom go down than a top ten list.
Decentralized and trustless blockchain protocols open a universe of services previously reserved for governments or large institutions. The opportunities are massive but many of them require founders and investors to completely change the way they think about societal infrastructure. Want to be your own bank? Want found a digital nation? Want to invest in a project owned by everyone? Want to invest in a project owned by no one? Want to do any of those in world where traditional borders mean nothing? This is the Cryptoverse, and in this episode we go floating around the tin can.
Uber is quite successful, and it has been for while. So long in fact that we've already cycled through startups being the 'Uber of xyz' as a badge of honor to it being an overused cliché. The Uber of 1980, however, would have been...well, hitchhiking. That's because the Uber app doesn't work without GPS which wasn't available then. And also, there were no apps in 1980. Nor smartphones. Timing is important, and it's worth your time to listen to Dave explain why.
In episode 23, Dave walks us through his professional journey. From the steel mills of Pennsylvania he emerged as an unlikely founder, and ultimately became a hero in the Florida startup ecosystem. He's experienced the highs and lows of building, funding and exiting companies, and has been highly adaptable as times have changed. Second best of all, he's willing to share his hard gained insight with us. Best of all, you get that wisdom packaged so that it goes directly into the deepest part of your brain. A place that only the Dave top ten list can reach.
A good diversification strategy is critical to successful investing. There's a notable exception and that's technology. Whether tech-based or tech-enabled, how companies use tech may be diverse, but that they use it is a constant in the best performers. In this episode, Dave walks us through why Seedfunders is so focused on tech enabled companies and why you should be too.
Have you ever been all dressed up with no place to go? That's a common scenario for startups in today's distracted world. Founders, who are often experts on their product or service, learn quickly that a great concept and a strong team aren't enough to get their beautiful company to profitability. The hard part is getting anyone to notice. In this episode, we explore some of the commonly held axioms of marketing and see how they apply to 2021 startups.
The word lean has been buzzing around the business lexicon since the 1980s. In the beginning, lean business practices applied mainly to manufacturing as a cost cutting strategy. Over the years though, it has become pervasive and is now applied to nearly every kind of business at every stage of development. For this episode, that stage is startup. Dave, having done way more homework now than he ever did in school, walks us through what the naysayers and hoorayers want us to believe about lean startups. He crunches the input and distills it all down to a 3 word philosophy he's been following for years, without even knowing it was lean.
The future is so bright, we had to break a discussion about it into 2 episodes. In this 2nd conversation we dig into crowdfunding and it's probable trajectory towards being a major source of capital in the future. And whether by new crowd methods, traditional VC channels, seed investing is where the action is flowing. With so much competition for good startups, the money is going earlier and that's where Seedfunders has been all along.
No one can accurately predict the future, but there's no one we would rather have not accurately predict the future than Dave. In this episode Dave brings his research, his insight and a few devices of the ethereal to the table (literally), and we try to figure out what the next few years hold for seed funding.
In this episode of the SeedFunders podcast, a new partner, Bob Kropp, pinch hits for Dave. Bob gives an overview of his experience in medicine and what it has helped him understand about investing in medical startups. He also shares why he joined SeedFunders and how valuable the group is to both founders and investors.
Startups fail. The startup road is littered with the carca.....and...swirling above there are vult...well - I'll spare your gory analogy. Let's just say if you're walking that road, wear your Wellingtons because it's inevitable you'll step in some startup. While we know some startups will fail, that does make us any less determined to make sure the ones we're invested in don't become the bad statistic. That means understanding why it happens. In this episode Dave brings studies and lists and is his best comprehensive self in examining why startups fail - and how Seedfunders uses that knowledge to support its portfolio companies.
There's a lot riding on cap tables. They, in theory, tell us who owns what equity in a company. But not all cap tables are created equal. Some show only issued shares, but not option pools or unissued shares. Some don't include the soon-to-be shares in convertible notes. Opinions vary on the correct format, so it's important to understand what to look for. That's exactly what you'll be able to do after listening to this episode of the Seedfunders podcast.
On this episode Dave leads us on a tour through the investment vehicle showroom. We cover equity, convertible notes and SAFEs as ways to invest. And we revisit the sometimes speedbump, sometimes launch ramp of valuation.
Doing due diligence on startups can be like trying to put fog in a box. The variables can shift ethereally or disappear altogether when the sun shines on them. But you still have to try.
To that end, Dave has created a checklist of 10 important factors he uses to gauge the viability of a startup. In this episode we go through them all, with gusto.
Seedfunders reviews hundreds of startups a year and one of the first things we look at is the number of founders. We typically use three buckets: Solo founders, teams of 2 or 3, and 4 plus. In this episode Dave shares which bucket he prefers as well as many other factors he considers important about founding teams.
"It's an art and a science" is a descriptor not often used in the financial world. Numbers, by definition, are qualitative. The exception to the norm is valuing startups, which may be neither art nor science, and instead something approaching voodoo. In this episode, Dave acts as startup shaman and explains the various ways to roll the bones to come up with a number.
For episode 10 of the Seedfunders Podcast, we turn our attention to Seedfunders itself. Dave lays out the SF investment thesis and how that thesis is activated by the partners. You'll hear some familiar terms and see how they specifically map to Seedfunders investments. Most importantly, you'll hear how Seedfunders partners value lifting up our community just as much as making a good return.
Diversity is a well trodden subject in investment content. Stocks and bonds, or bonds an stocks? The traditional answers explain diversity within these two classes. But what about our favorite asset class - the startup asset class? In this episode, Dave share his insight on how startups play an important role in a truly diversified portfolio.
Term sheets are not legally binding, but people still get pretty attached to them. That makes sense as they represent the first articulation of what could become a pretty big deal for the startup. In this episode, Dave helps us understand the many facets of a term sheet - what they do, what they don't and what it all means to putting a deal on paper.
Bootstrapping, friends & family, pre-seed, seed, series a, series b series c..and here it looks like they just gave and threw the alphabet at the problem of naming the different rounds startups may enter while raising capital. To some extent it doesn't matter because the lines between rounds are blurred. In this episode, Dave charts a path of discovery through the various rounds. For each we consider the generally accepted definition of the round as well as where some may stray from said definition.
Crowdfunding is a term that lives in a cloud of misinformation. At least some of the confusion comes from there being several different types of crowdfunding and changing laws within those types. In this episode, Dave digs into 3 types of crowdfunding: donation, reward and equity. We spend the most time understanding equity crowdfunding, made possible by the JOBS act and other important legislation.
A key component to mastering portfolio diversification is understanding asset classes. In episode 5, Dave gives an overview of asset classes and explains where startups exist as an asset class. We consider how alternative asset classes, like startups, may act as a hedge to more traditional asset classes in their lack of correlation to them. Enjoy this short, but mighty episode.
Do angel groups provide better returns? In episode 4, Dave Chitester explains why the answer is a resounding yes. Citing multiple studies, Dave breaks down some of the key elements that give angel groups an edge: due diligence, industry experience & participation after investment. The benefits don't stop at deal success as there's upside to be had in risk mitigation factors - specifically investing smaller amounts in more deals to improve overall return. Join Dave and Joe to dive into the data in this number crunching episode.
Episode 3 delivers a deep dive into angel groups. Pooling resources and working together has some expected and unexpected benefits. Dave explains each of the key considerations and how angel groups deliver value to investors. We also profile the different operating structures that angel groups employ to cover operating costs.
In episode 2, Dave walks us through the investment path a new company typically follows. The earliest operating capital comes from bootstrapping founders, followed by friends and family. With some success, the company is ready to engage angel investors, who are accredited and often work through collectives like Seedfunders. Next we consider what makes a company investable and what makes a good angel investor.
Welcome to the inaugural episode of the Seedfunders podcast. In this episode, and the next few, Founder Dave Chitester sits down with host Joe Hamilton to give a 101 overview of all things early stage investing in Florida. In this episode Dave runs through the different players and their function in the startup ecosystem. Founders, mentors, incubators, accelerators, connectors and funders all play a critical role in building the economy of tomorrow. Listen to the Seedfunders podcast to better understand the important and action-packed world of startups and how you can join in.