Jeffrey Toewe

🚀 𝐔𝐧𝐥𝐨𝐜𝐤 𝐒𝐭𝐚𝐫𝐭𝐮𝐩 𝐒𝐮𝐜𝐜𝐞𝐬𝐬 𝐰𝐢𝐭𝐡 𝐔𝐫𝐢 𝐋𝐞𝐯𝐢𝐧𝐞’𝐬 𝐈𝐧𝐬𝐢𝐠𝐡𝐭𝐬! 🚀 Uri Levine, co-founder of Waze and Moovit, shares invaluable lessons in his book “𝘍𝘢𝘭𝘭 𝘪𝘯 𝘓𝘰𝘷𝘦 𝘸𝘪𝘵𝘩 𝘵𝘩𝘦 𝘗𝘳𝘰𝘣𝘭𝘦𝘮, 𝘕𝘰𝘵 𝘵𝘩𝘦 𝘚𝘰𝘭𝘶𝘵𝘪𝘰𝘯.” Key takeaways include the importance of passionately embracing the problem you’re solving, the necessity of customer retention as a marker of product-market fit, and the strategic use of pitch deck slides. He also emphasises the significance of hiring and firing correctly and observing user behaviour to refine your product. These principles can transform your startup journey, ensuring resilience and growth. 🌟 #StartupSuccess #Entrepreneurship #ProductMarketFit #Innovation

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Applicability, scalability, interoperability, and flexibility. Such are four of the seven attributes we look for when attempting to establish whether a potential investment is indeed a platform technology — attributes that have long shaped our interests, eluded our declined investments, and hopefully stumped the public for the last time. Behold, the tenets that comprise a “platform,” as defined by Sridhar Iyengar, Sophia Hsin-Jung Li and me: https://lnkd.in/eUqW5akQ

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This week Mikal Ventures brings you a 4-week breakdown of the non-US capital market with an emphasis on the Mikal verticals. Over the 4-week period ending May 29, a total of 1,545 new companies were added, with 101,688 companies included in the non-US Health Tech, Med Tech, Fin Tech, AI Tech, and Ed Tech verticals. The non-US AI Tech saw the greatest percentage growth in new companies for the period, weighing in at a notable 27%, nearly two times the overall vertical average of 15%. The non-US Heath Tech vertical led the group in transactions. Non-US Med Tech vertical lead in both SEC Filings and news articles. Mikal Ventures publishes these stats on a rolling 4-week basis to provide a perspective on how the verticals and new startups move through time. We hope you find them informative and thought-provoking. VC Investors are always adjusting their "Play Book" with a variety of options for investing. Mikal Ventures is one of those alternatives, offering curated solutions to real world problems. Reach out if you have questions on how we can be of assistance and bookmark https://mikalventures.com/ for additional insights and information.

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The healthcare landscape is rapidly evolving, driven by advancements in technology and a deeper understanding of patient care. I had the pleasure of speaking with Ambar Bhattacharyya, Co-Managing Partner at Maverick Ventures, on the latest episode of The Full Ratchet. Ambar has partnered with numerous billion-dollar companies like hims & hers, Cityblock Health, Devoted Health, and ConcertAI. His unique journey from rural America to becoming a prominent figure in venture capital offers invaluable insights into the future of healthcare and technology. We discuss his investment strategy at Maverick Ventures, the megatrends shaping healthcare, the impact of AI on the industry, and the importance of integrated care. Ambar also shares his thoughts on the challenges and opportunities in healthcare investment, offering a comprehensive view of what lies ahead. Check out TFR Episode 438 to catch our conversation. You'll be glad you listened.

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This week Mikal Ventures brings you a 4-week breakdown of the non-US capital market with an emphasis on the Mikal verticals. Over the 4-week period ending June 24, just over 1,160 new companies were added, with 102,850 companies included in the non-US Health Tech, Med Tech, Fin Tech, AI Tech, and Ed Tech verticals. The non-US AI Tech saw the greatest percentage growth in new companies for the period at 16%, vs. the vertical average of 11% for the period. The non-US Health Tech vertical led the group in transactions. The non-US Med Tech vertical lead in both SEC Filings and news articles. Mikal Ventures publishes these stats on a rolling 4-week basis to provide a perspective on how the verticals and new startups move through time. We hope you find them informative and thought-provoking. VC Investors are always adjusting their "Play Book" with a variety of options for investing. Mikal Ventures is one of those alternatives, offering curated solutions to real world problems. Reach out if you have questions on how we can be of assistance and bookmark https://mikalventures.com/ for additional insights and information.

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When I first read Jevgenijs Kazanins's very excellent fintech take on why Cash App Pay could be the next major driver of Block’s growth, I was floored by his initially compelling case that if Cash App can incentivize more payments payments volume to go through Cash App Pay, they can drive massive gross profit uplift, because Cash App Pay’s take rate is substantially higher than Cash Card’s take rate on purchase volume (2-3x). But if it were true, why hasn’t Cash App taken advantage? Whereas Jevgenijs is more optimistic about the ~$2.5bn in GPV that Cash App Pay has generated in its first ~2.5 years of existence, I find it downright embarrassing. That’s less than 1% of Square’s GPV after two years in the wild? And that’s despite it being essentially pre-installed on every terminal with no change in hardware required. I started to have a sinking feeling that maybe something was missing in the calculus. And as I dove deeper, it became clear that the “magic” take rate uptick we thought we’d found was more of a magic trick, relying on some deception. The seeming increase in take rate comes about like this. Normally, when a Cash App user makes a purchase, Cash App acts as the Issuer which means there are several intermediaries between what the merchant is charged and what Block earns on the transaction, meaning its ultimate take rate is relatively low. But in the case of Cash App Pay, there’s potentially a few magic tricks at work. The first is that in this case, Block is facilitating the Square merchant’s acquiring POS AND it’s issuing the Cash App user’s debit card, thereby cutting the intermediaries down in the typical payments flow and seemingly increasing Cash App take rates by 35-50% (instead of just interchange, you’re now getting interchange and markup). But then gets even better with the second trick, because if you’re both the acquirer and the issuer, *you don’t even need the payment network at all*. You can simply move money by book transfer between your merchant’s bank account and your user’s bank account in a perfectly closed loop payment network. Suddenly, Cash App Pay has a magical 2.9% take rate with no money movement costs at all. The problem with these magic tricks, like the ones in life, is that they are actually using some deception to hide what’s truly happening. Let’s play it out. In the status quo, without Cash App Pay, Square would earn ~1.85% in acquirer markup and Cash App would earn 0.90% in interchange for a total of 2.75% in take rate. In the Cash App Pay case, Square and Cash App would split the 2.90% Merchant Discount rate they artfully charged without having any money movement. So instead of the 2-3x markup, the uptick is more like +15bps (+5%). So maybe there isn’t a massive take rate arbitrage, but Block should still be focusing on its closed loop payment network because it represents huge opportunity for other reasons. Read the full post at https://lnkd.in/d93nkn29.

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One of my proudest moments as an investor occurred today as Alaffia Health announced its series A because it shows how the Aperture® Venture Capital vision of multi-level, multi-generational #impactinvesting is succeeding in the marketplace. Here’s the model in its most basic form : ✅As diverse fund managers with meaningful capital to allocate, we are changing the VC landscape every day just by doing our day jobs. ✅As Black/Brown investors with ~40 years experience collectively, Aperture GPs have access to talent /excellence that others do not, so our portfolio *organically* is more inclusive by race, gender and geography even while optimizing for financial outcomes (all about the alpha). ✅Our most successful portco’s are using financial #innovation to solve market problems that impact underrepresented demographics and underserved communities. Alaffia Health is a shining example of the impact portion of our overall fund thesis, and we couldn’t be prouder of TJ Ademiluyi and Adun Akanni, MPH, PMP - the dynamic brother-sister founder duo whose vision we have steadfastly supported on their journey. Congratulations to TJ and Adun from William Crowder and myself, as well as the whole Aperture team- Marjorie King Philip McKenzie Yves Louis-Jacques Tanvi Lal Michelle Dhansinghani Lisha Bell Katie Kelly Amy Chung Cindy Chong, CFA Brian Fernandes-Halloran Monroe France Jayden Pantel Darren Herman Evan Wladis Neal Triplett Thomas Scriven Peter Ammon Irina Bit-Babik Tim Milanich Rob Rahbari

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According to the latest report from Rock Health, digital health funding in Q1 2024 totaled $2.7B across 133 deals, with an average deal size of $20.6M. It doesn’t break out device-related investments, but most medtech founders I meet these days are being forced to chase tiny rounds made up of endless little checks, consuming valuable energy and slowing their progress. The benign neglect of this next generation of diagnostic and therapeutic devices is counterproductive and surprising. Given the crowded virtual care market, for example, I’d expect more such companies would be exploring medtech partnerships, investments or acquisitions that'd enable them to back integrate into delivering sharper, and more differentiated, care and treatment. This is exactly what Maverix Medical is doing from the other direction: Reshaping the entire spectrum of lung cancer care by integrating more advanced + effective approaches to screening and diagnosis, treatment and therapeutics, and even palliative care…And putting it all to work through an innovative provider network. One notable investor exception is Y Combinator partner Surbhi Sarna who’s been backing great teams like Selera Medical (YC W24) doing foundational work on ambitious medical devices. Without more support from investors like her, we’re going to increasingly find ourselves stuck with the incremental portfolio improvements from the incumbents, and that’s just not nearly enough.

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How to value a seed stage company? Who knows...(Well, Jack McQuire does but I had to fill in for him at the last minute for last week's Valuation Masterclass.) Here's a slide I prepared highlighting some of the recent seed rounds we have led and supported. Two surefire valuation methods: comparables (i.e. numerous rational references to companies similar to you) and the market (i.e. pitch as many investors as you can and see where they land). I have seen valuations double simply as a result of well-managed competitive processes. Governance, Terms, and War Stories sessions coming up. Register here: https://lnkd.in/ghJJpdR4

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Should you sell your practice to a VC-Backed MSO Startup? tldr: - new VC-backed startups are forming MSOs to roll up independent practices - The pitch is physicians receive early liquidity from the roll up and are granted ESOP shares that can be used for retirement - Problem is the use of ESOPs with independent practices is not a new concept and has been used with large group practices since the 70's - ESOPs do not grant full ownership and in order for the shares to be valuable for retirement, the practice needs to run the same if not better post roll up - With VC-backed startups being primarily operated by non-physicians with zero clinical or medical practice experience, the likelihood of this happening is extremely low making the entire concept high risk However, there is a viable path for continued ownership + liquidity for independent practices. Check out the article to learn more. ⤵ https://lnkd.in/gmGvTYwP

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What do you do as a founder, when you're no longer VC-backable, but are too small for private equity? Join us on May 23rd for a fireside talk with Andrew Chang, where we will explore the venturePE financing model, the gap in the funding markets that we address and how back companies that need that extra push and operating muscle. Lauren Bonner Jonathan Jetmundsen MBM Capital #fundraising #venturePE

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Nic Poulos and I wrote an essay for Euclid Ventures, "An Era for Vertical Software." The TL;DR is that vertical SaaS is a distinct, enduring discipline that we believe is poised to dominate the software landscape over the next decade.   "2024 will represent a turning point, perhaps even a new era for venture capital. While the fog feels like it’s lifting, the path forward isn’t yet clear. One includes a soft landing for the US economy and the continuing recovery of software multiples, with ZIRP-era behaviors continuing around hot themes. Another sees a recessionary period in which VC capital inflows remain stagnant and startup funding the year dips below $100B. Either way, a more measured VC market in 2024 is a certainty. For many investors, that will come with a rude awakening as their strategy becomes more difficult to execute or their thesis of choice is negatively impacted by tightening markets.    We see this reversion of the venture ecosystem to its mean as a strong tailwind for Euclid and vertical software. As a category, Vertical SaaS is uniquely well suited to thrive in volatile market conditions and produce fund-returning outcomes. The sections below aim to answer the question: why is vertical software different? Our answer discusses the factors driving the natural market resilience we see in vertical software as a category–resilience that will help them thrive in 2024 and beyond."

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How many companies in a single screenshot are ready for #disruption by a savvy #DLT #startup? I count 2. If a company has 1/5 stars from the majority of customer ratings, how is that still an A+ BBB rating? If Escrow(.com) is so universally bad to such a wide variety of customers, how long before a half way competent #fintech comes to eat their lunch? I can't help but think there's a better way, and it probably has something to do with distributed ledger technology. Ideally on a trusted network with adults at the helm like Hedera. In #2024 with such technological marvels left and right; why should any company be able to get away with this?

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🚀 AlleyCorp Closes $250M Fund to Fuel Tech Innovation in NYC and Beyond🗽 🌟 Founded by NYC internet entrepreneur Kevin Ryan, AlleyCorp incubates and invests in transformative companies across diverse verticals including Diversified Technology, Healthcare, Robotics, and Impact. 💡💰 🤝 The fund, backed by a select group of LPs, supports AlleyCorp's mission to originate ideas, hire teams, provide initial funding, and maintain integral leadership throughout the company’s lifecycle. 🌱🔍 💼 With about 20–30 new investments and 5–8 incubations per year, AlleyCorp has a track record of nurturing early-stage tech pioneers. 📈🌐 🦄 Notable investments include MongoDB (NASDAQ: MDB), Business Insider, Gilt Groupe, Zola, and Nomad Health, shaping the landscape of tech innovation in NYC. 🌆🌟 🔬 AlleyCorp also announces the incubation of Radical AI, pioneering AI-driven materials design, and Conduce Health, revolutionizing access to personalized healthcare specialists. 💻🏥 ✅ Looking to raise capital for your #fund and increase the international pool of your LP #investors?   🤝 Need warm #LP introductions?   📝 Selling #secondaries to increase liquidity?   🧐 Looking for co-investments?   ▶ G+QUANT's link for inquiries and fund decks: https://lnkd.in/gjC_EuTE #VentureCapital #TechInnovation #NYCTech #StartupInvestment #Incubation #AlleyCorp #ImpactInvesting #HealthTech #AI #Robotics #DiversifiedTechnology #InvestmentStrategy

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This week Mikal Ventures brings you a 4-week breakdown of the non-US capital market with an emphasis on the Mikal verticals. Over the 4-week period ending May 29, a total of 1,545 new companies were added, with 101,688 companies included in the non-US Health Tech, Med Tech, Fin Tech, AI Tech, and Ed Tech verticals. The non-US AI Tech saw the greatest percentage growth in new companies for the period, weighing in at a notable 27%, nearly two times the overall vertical average of 15%. The non-US Heath Tech vertical led the group in transactions. Non-US Med Tech vertical lead in both SEC Filings and news articles. Mikal Ventures publishes these stats on a rolling 4-week basis to provide a perspective on how the verticals and new startups move through time. We hope you find them informative and thought-provoking. VC Investors are always adjusting their "Play Book" with a variety of options for investing. Mikal Ventures is one of those alternatives, offering curated solutions to real world problems. Reach out if you have questions on how we can be of assistance and bookmark https://mikalventures.com/ for additional insights and information.

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A lot of investors have been asking me what the major industries are in the Venture Miami Built in Miami Startup Program. Here's the industry breakdown across 214 new South Florida startups. TLDR: The South Florida startups are pretty diverse across industries. Here's the largest categories in order: - 16.2% AI & Machine Learning - 14.2% EdTech - 12.2% Healthcare - 8.5% Marketing & Sales Tech - 8.1% FinTech - 7.4% Sustainability - 6.1% Travel & Hospitality - 6.1% E-Commerce The smallest category: Cybersecurity at 1.2% There's an additional 50 startups that didn't complete the survey in time but we'll get that info updated by Demo Day June 20th. #BuiltinMiami

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I recently had an enlightening conversation with Alex Pattis, general partner of Riverside Ventures and author of the #1 VC syndicate newsletter, "Last Money In." Alex's journey from sales director to launching a syndicate that has completed over 300 deals is truly remarkable. He's deployed over $70 million in capital and built a network of thousands of LPs along the way. During our chat, Alex clarified the intricacies of syndicates, explaining how they differ from traditional venture funds and the unique value they bring to both founders and investors. Syndicates offer a flexible, deal-by-deal approach for LPs, allowing them to cherry-pick investments. Alex highlighted that having a tier-one VC co-investor can significantly boost LP interest in a syndicate deal. Transparency and managing expectations are crucial when working with founders, according to Alex. He also shared insights on how Special Purpose Vehicles (SPVs) can be a strategic tool for founders to consolidate smaller investors. These structures offer a way to simplify cap tables while still accessing a broader investor base. Alex offered his perspective on the current syndicate market, noting the increasing interest in growth-stage and pre-IPO deals due to shorter paths to liquidity. This trend reflects a shift in investor priorities and the evolving landscape of venture capital. Whether you're a founder looking to understand syndicates or an aspiring investor curious about this unique approach to venture capital, Alex's insights are invaluable. Check out Episode 48 of Fundraising Demystified to learn from Alex's experience and gain a deeper understanding of the syndicate ecosystem!

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Everyday, Americans lose income because banks pay essentially no interest on money in their checking accounts. Evergreen Money, my latest venture, launches today with our first product, Liquid Treasuries. It transforms the potential of these accounts by offering users a high yield without sacrificing any of the traditional conveniences of checking. In fact, we’re so excited to officially launch today that we’re taking over the New York Times homepage! To learn more, please visit evergreenmoney.com

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When it comes to business acquisitions, assessing the risk is crucial. Here's a breakdown from my recent analysis of a quilt store purchase: SDE: $257k  Total Deal Cost: $1.27 million SBA Loan: $1.14 million at 90% LTV Equity Needed: $127,000 Annual Loan Payments: $189,000 at 11% interest After loan payments, the business would net only $70,000 annually. Additionally, the asset base leaves a negative airball of $700,000, indicating substantial risk. Why would you take on such a deal for relatively low returns? The answer - most people wouldn’t. And this is why deals like this should be priced closer to 2x or 3x SDE and include a healthy dose of seller financing. No one is going to take on the gargantuan risk of a deal like this at the seller's asking price. Once you understand the math, it's like having x-ray vision to quickly evaluate whether deals actually make sense or not. In this case, this one does not pass the sniff test to me. What do you think? Let me know in the comments. #SMB #ETA #finance #Cashflow #investing

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