1Mby1M Virtual Accelerator Investor Forum: With Alireza Rahnema of 7 Gate Ventures (Part 2)

Sramana Mitra: On that geography topic, what’s happening from an immigration point of view in Vancouver, Canada given the friction that’s happening now in America around immigration? Are you seeing a big influx of talented engineers that are also entrepreneurs from other places?

Alireza Rahnema: I must say this has vindicated our thesis with 7 Gate in the past couple of years. Even founders, with the background that we had, have been disbarred from going the route of a US immigration. We see a lot of these talented graduates from technical universities in the Middle East looking at Vancouver as an alternative to the States, given the political climate.

We are seeing this more often and this has been the focus of the fund. The focus is to promote diversity in entrepreneurial ecosystem and be backed significantly by our founders who are first generation immigrants and who are also very technical, highly educated, and highly motivated. They find migrating to the States somewhat more difficult.

Sramana Mitra: Does Canada make it easy for founders to start a company versus the specific visa track that entrepreneurs that can get on? It’s really a nightmare in the US to do that.

Alireza Rahnema: If they really do, they really do. Apart from the immigration route, once they get here, there are various government federal advocacy prevention sentences to provide capital to technology-based startups as well as incentives for investments. If you’re an angel investment in Canada, you get a different problem with tax benefits.

We have basically promoted ourselves as one of the vehicles that helped the founders a great deal in tracking these various incentives and grants that are available that require some red tape. It’s somewhat complicated. But we have been successful in getting those back in the hands of the foundation and giving them a head start when it comes to fundraising as well as investing.

Sramana Mitra: What are you discovering in your interfacing with Silicon Valley? Are Silicon Valley investors taking up particular interest in Vancouver because of the visa situation?

Alireza Rahnema: There’s a lot of activity going on in Silicon Valley. There’s such a growth of capital available to these founders. I know there’s some talk of an exit in Silicon Valley given the high cost of living for entrepreneurs. Other locations are becoming more attractive, but generally it is undeniable that Silicon Valley is still the capital.

This doesn’t give the venture capital that we talked to a great deal of interest in looking elsewhere. There are close firms like startups where we co-invest. Generally, they’re very happy to have a co-investment opportunity with a friend like 7 Gate that has embedded through startups. These are outside their geographic location.

Sramana Mitra: Let’s talk about stage. You were investing a relatively small fund. At what stage do you get involved? What level of validation are you looking in your investments?

Alireza Rahnema: We have done some opportunistic investments beyond other VCs from the Valley. We like to go in very early. It’s not a requirement for us, but we help those founders to be able to identify and build the traction and KPI. Our office here in Vancouver has a few of our portfolio companies located. In early stage, our check prizes have a range from $100,000 to $500,000, depending on the progress that we would like to see.

This segment is part 2 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Alireza Rahnema of 7 Gate Ventures
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