Investment Thesis: Peter Redford

Some of you have read my previous coverage of the TVI vs. Microsoft case in which TVI sued Microsoft over the Autoplay patent. Peter Redford, CEO of TVI, won that case earlier this year, and has since joined the Band of Angels, as an Angel investor. The Band is one of the best organized Angel groups in Silicon Valley (the world?) and actively bridges the gap between entrepreneurs and venture capital by seeding deals largely in the 250k-750k range.

SM: Please describe your background, to help entrepreneurs understand your point-of-view.
PR: I spent the last 26 years building and running technology companies. I am one of these two-headed, left-and-right-brained entrepreneurs who enjoys starting at the “invent something” stage and then shifting gears to building a professional team, securing equity funding and leading the company to and through the exit stage. My initial entrepreneurial success was to sell my first company to Yamaha in 1982. The most recent success was to settle a big patent litigation case against Microsoft – just three days before jury trial. I guess this proves that two heads are better than one.

SM: What stage are you looking to invest in over the next 6-12 months?
PR: I prefer to invest in early-stage startups that are looking for seed capital. Investing with the Band of Angels gives me an efficient way to effectively see as many as 90 deals each month.

SM: What segment(s)?
PR: Typically I am looking for software and new-media technology deals. I am also eying “new” medicine deals but am not ready to invest in them yet.

SM: What market dynamics do you look for?
PR: I like to look five-years ahead but the deal must have a ready market, be scalable and must not rely on “aligning of many moons”. And, I definitely need to see protected intellectual property.

SM: What size of investment are you looking to make?
PR: I look for $1M to $4M pre-money (valuation) deals where I can invest a significant chunk of a $300K to $750K seed funding.

SM: What kinds of deals are you interested in seeing? What is tha rationale behind your investment?
PR: For me, the rationale behind making an investment is almost always “love-at-first-sight”. The decision to invest is quick but the bar is very high. What makes me fall in love? More than anything it’s quality. Quality of the CEO, the technology, the prototypes, the quality of the business plan. What makes me fall out of love? Even a hint of exaggeration.

SM: Do you fund capital-intensive deals? PR: No.

SM: Do you fund built-to-flip deals? PR: No.

SM: Do you fund “hits” businesses? PR: No.

SM: Describe your ideal entrepreneur.
PR: It’s back to love-at-first-sight and quality. A dynamic and generous CEO with energy, intelligence, persistence, trust and modesty to spare. When I meet this type of an entrepreneur I get REALLY excited! I look for CEOs who understand that business runs on relationships. That understand the value of a great team and a great board. CEOs that consistently never take anything (including me) for granted.

SM: Which VCs do you like to work with as part of a syndicate or follow-on?
PR:The Band works with all the top-tier VC funds, I don’t have a preference.

SM: What is your thesis on entrepreneurial / investment opportunities given the state of the market? What markets are likely to crash? What markets are likely to open up?
PR: I have been through so many up-down-UP cycles that I am not terribly concerned about the short-term lack of IPOs. I also do not consider mergers and acquisitions to be dirty words. And, I am generally optimistic about the long-term market potential.

I don’t think that any markets are currently ready to crash – but some companies are. I am watching two emerging markets with great interest: video on cell phones and personal medicine.

If you decide to approach the Band of Angels, you need a sponsor who is one of the 105 members of the Band. This member, your sponsor, will work with you on your deal, and help you get ready to present to the full Band at their monthly dinner event, where members choose who wants to invest in what.

This segment is a part in the series : Investment Thesis