1Mby1M Virtual Accelerator Investor Forum: With Kelly Perdew of Moonshots Capital (Part 3)

Sramana Mitra: Let’s do a couple of things next. I’d like to understand what are you really proud of in your portfolio. What’s really scaling? What’s looking really interesting? As you explain to us some of these case studies, give us some insights into your thinking in making the decision to invest in these companies besides the founder being a military veteran. What else do you factor into that process?

Kelly Perdew: A great example is our second investment in a company called New Knowledge. You might not have heard of their company name but I’m pretty sure you have heard of them. They’re former Army NSA founders. They are the team that identified Russian involvement in social media using bots. It’s a pretty phenomenal team. They’ve got very sophisticated monitoring and listening capabilities as well as interdiction capability.

The founding CEO was working with the State Department previously and the founding COO was the former Army and NSA leader. They’re just very compelling individuals in terms of creating a vision and being able to communicate that very effectively. The thing that I say to all of our entrepreneurs is, “Sales cures everything.”

They happen to be at a specific point in time where there’s a lot of fake news and people not trusting what’s going on. Being able to know and understand what’s legitimate and what’s not is incredibly important. It’s only going to be more so, so that this kind of dystopian society that we’re living in can get some grounding.

Sramana Mitra: What is the business? Is it a SaaS analytics business?

Kelly Perdew: Yes, it’s a SaaS business. Think about any large company or government department that wants to monitor and understand what’s being said about them and if there are activities associated with them in the social media environment. Take a large entertainment company that could have a controversial movie coming out.

The last thing they want is, on the day before the movie launches, to be completely blindsided by a group that is creating a negative campaign. They’ll pay a significant amount of money to be aware of that happening and then to potentially take action to protect themselves. That applies across multiple industries. If you look at people who are making decisions in the financial market such as large oil & gas entities, public opinion can have billions of dollars of impact on their ability to do exploration. There are obvious applications for government entities.

Sramana Mitra: In a situation like this, we’ve had a lot of SaaS investors here. There are some trends that we are observing and I’d like to get your take on that. The ones who are doing Series A are looking for a million dollar ARR before they’re willing to write a check. There are some post-seed, pre-Series A people who have their own metric. When you’re looking at SaaS deals, what is that revenue benchmark?

Kelly Perdew: Do you agree that sales solves just about every problem?

Sramana Mitra: I totally agree. That’s what we constantly harp on here. I much prefer companies that generate revenue. Our definition of entrepreneurship is customers, revenues, and profits. Financing is optional. I’d rather people don’t get flushed with financing and forget how to be disciplined about revenues.

This segment is part 3 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Kelly Perdew of Moonshots Capital
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