1Mby1M Virtual Accelerator Investor Forum: With Cameron Kramlich, General Partner of Angelneers (Part 5)

Sramana Mitra: You would invest in somebody who has great talent and great domain knowledge if that person is proposing something in that domain where the problem is identified. Isn’t that a concept stage investment in a very talented person?

Cameron Kramlich: Sure, it would be. Looking at somebody who has a general area they want to work in and has enough neuroplasticity to realize that whatever is on the pitch deck is going to change 15 times. That’s why if it’s just a 10-slide, that’s great. It needs to be more than that. What we’re looking for is people that we can coach and help grow.

For a lot of companies that we invest in, they might not even have a pitch deck. We’re like, “We like you and we think you’re smart. You’ve done a great job at your time in Oracle. Here’s how we can help you figure out a problem you want to solve and build out a team.” We’re about creating happy companies and happy entrepreneurs.

Sramana Mitra: The reason I’m probing that is, there is a whole category of enterprise software entrepreneurs who are solving deep tech problems. It is not easy to cobble together a product for deep tech problems. You need money to hire engineers. They don’t operate so well as lean startups. These are fat startups. At the same time, there is a lot of talent.

If you take an esoteric vertical with esoteric opportunities for applying AI to that problem and if you find a domain expert who understands that, you still need to build a team around that person to get a product out. The only way that that person can raise money is with a concept stage and based on his or her own resume.

Cameron Kramlich: I understand. Those people are probably not the right fit for us. We’re super excited about fusion. For our model to work, it’ll be people who use fusion to have new applications as opposed to people who need to raise $5 billion in Series A.

Sramana Mitra: We’re not talking about $2 billion dollars; we’re talking about $2 million.

Cameron Kramlich: To do deep tech, $2 million is not enough money. Maybe $20 million.

Sramana Mitra: People don’t do $20 million pre-seed. I don’t see that happening. People are doing it on a milestone basis.

Cameron Kramlich: That was my point. There are different-sized deals that work for us. We’re an early-stage fund. If you’re looking at something where you have to have 20 people and feed them for 18 months, that’s one type of company. If you’re looking at something where you have an enterprise software product and you need two marketers and a couple of engineers, that’s a different type of company.

Sramana Mitra: Your preference is somewhat lean companies where you can get some amount of validation early on.

Cameron Kramlich: Correct. If we join too late, there are too many people, and we can’t influence the culture. If we work with a company where things have to be too heavy, our model doesn’t work.

Sramana Mitra: I understand. You’re okay with solo entrepreneurs but you want to see some amount of validation. You want to see a talented anchor founder around whom a team can be built.

Cameron Kramlich: Correct.

Sramana Mitra: Terrific. It was very nice to know you. Thank you for your time.

This segment is part 5 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Cameron Kramlich, General Partner of Angelneers
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