AngelCentral Startup Performance Report Card for 2017 and 2018
We set up AngelCentral in 2018 to build effective angels for ASEAN market. To achieve this, we offer comprehensive dealflow, loads of learning and services to help Angels syndicate deals. We are happy to say after three years, we have made good headway on all the three headline offerings. We have vetted 1500++ startups since inception, 500+ angels trained via numerous workshops and to-date 17 successful syndicates. (#throwback2020 – AngelCentral 2020)
Digging into the dealflow, one of the primary values we offer for our members. Our experienced partners curate ~700 startups we received annually and only showcase 40 or so to members via pitches. Naturally one common question we get is how good is our curation? And the follow on question is how many great startups did we miss?
To answer the former question, it is best to use similar measures of success as VCs, to have an apple to apple comparison. So we decided to do a simple TVPI measure for each startup that pitched in the 2017 and 2018 cohorts. It is necessary to have at least 2 years to pass from pitch because that is frequently the timeframe it takes to close a new upround. We also took into consideration the revenue growth for those startups that have not raised a new round. But rather than use an arbitrary discretion to assign a larger valuation we decided to just highlight them as startups that are doing well but keep the TVPI at 1x.
One caveat with our report is that we do not have very accurate TVPI numbers per startup. This is because we are not direct investors in many of the startups, so we had to gather data from many sources in order to form a multiple (or multiple estimate) per startup. These data points include own investee reports, ACRA, VCs, news sources etc. We believe our estimates are sufficient to give the rough performance of each cohort and give a sense who the winners are. In addition, all data reflected as of end Nov 2020, assuming one invested the same amount into every startup that pitched at our 2017 and 2018 pitches. All startups named with uprounds or failure are based on publicly available data.
Startup Performance Report Card for 2017 (17 Pitching Startups)
|“Upround”||7||Homage (Series B), EngageRocket (Series A), ParcelPerform (Series A), etc.|
Startup Performance Report Card for 2018 (41 Pitching Startups)
|“Upround”||5||Neuron Mobility (Series B), See Mode (Series A), Pencil (Series A) etc.|
Comments & analysis on the startup performance report card for 2017 and 2018
- Winners pay for the failures.
- 2017 startup cohort has done very well climbing out of the J curve within just 2+ years. It is a clear validation of how a portfolio needs strong winners (Homage) who then pay for the many failures.
- 2018 startup cohort looks to be following the same trajectory with Neuron, See Mode doing the same.
- Failures come fast in startups (first 12 months, same reason for the dip in the J curve for most seed VC portfolios) Both 2017 and 2018 cohorts have seen quick failures. 25% for 2017 and 19% for 2018. We do think the climb out of the J curve dip within 2 years is indicative quality for our startups.
- Getting in early and at a good valuation matters a lot, especially since we can see most ASEAN level exit valuation hovers below 100M USD. (As a rule of thumb, I always aim for my first cheque to invest at a valuation below S$5m)
- What I called the “ongoing” startups – they are doing well with some growing revenues 2,3,4,5X MoM, and a couple already crossing $2M SGD ARR. While we are unable to assign a valuation lift for these startups (no official fund raising), the data points we researched surrounding startups like Nimbus, Rely, Tenopy, GoalsMapper, TribeHired, Portcast, UI-licious etc all indicate a high chance of doing well moving forward. Many of these pitched in 2018 with AngelCentral and we believe when their equity/ fund-raising events come, the cohort metrics will lift upwards substantially.
- Looking at all the startups that are doing well,
- A large proportion are B2B software/platform startups. However, we note two of the big winners Homage and Neuron are consumer facing at the same time.
- Many are deep tech startups like Musiio, Hydroleap, Medo, SeeMode etc. This is a deliberate AngelCentral strategy to embrace deep tech accelerators and build the skillset to evaluate deep tech startups.
In conclusion, the 1.58 TVPI and 0.99 TVPI for cohort 2017 and 2018 respectively does seem to show we are on track to deliver on the 3X TVPI we aim to achieve for each cohort within a 7-10 year cycle. However, it is still early days, all the gains are still paper-gains and we will continue to analyze each cohort and track their growth as the years go by.
(We are adding a new Masterclass workshop – Building up your portfolio tracking worksheet – in April 2021. Stay tuned!)