• Tech Week Kickoff Party (Stealth Mode)

• Pulse (Sponsor)

• July Breakfast Club Recap

• Alex Pattis, Breakfast Club Member Spotlight

Breakfast Before Dawn: NYC Tech Week Kickoff Party

I’m teaming up with Popl and Bulletpitch to throw a blowout opening night party for New York Tech Week. Food, Drinks, Elite Entertainment.

Popl and Bulletpitch are only giving me an allotment of 100 tickets for Tech Breakfast Club members, though.

I know it’s a ways off, so if you buy a ticket now and end up not being able to make it, I’ll refund the ticket

If you have any questions or want reassurance that you’ll have a very good time, reply to this newsletter.

To purchase, click the button below:

Today’s Newsletter is Powered by:

Pulse

I couldn't think of a more perfect partner for the Breakfast Club. I've been on the lookout for a way to keep track of all the connections I make between hosting Breakfast Club and attending dozens of other events in New York.

Ricky, the founder of Pulse, has built such an easy to use tool. You import a contact, you tag info, record some notes, Pulse remembers where you met, and then it prompts you about when to follow up - maybe next week?

A big goal for me (now that there's less than 6 months left in 2023) is to stop networking and focus on building relationships - following up and providing value for the interesting, amazing, super talented people I meet.

I encourage you to download Pulse before the next meetup. Give it a shot. I think you’ll appreciate that Pulse gives you a free digital business card to share all your links and info with others.

I've invited Ricky to the meetup so if you see him, be sure to tell him what you think of the app.

July Breakfast Club Recap

Great to catch up with everyone! Vibes were good. Weather was acceptable. Jibby was on point with the coffee. Ricky, the guy running around with the very expensive camera, from Pulse, made some incredible content.

I’m grateful I got celebrate some big wins with Jack McClelland and Ariel Purnsrian, my cohosts. Shoutout to Jibby and James (Jibby’s Founder), they’re crushing it. I loved catching up with a lot of familiar faces, meeting a bunch of new people, hearing about who’s starting something (and who’s shutting down something), what’s working, what’s not, what’s next… this is life - it feels good to be alive and to be in New York.

Next Breakfast Club is tentatively scheduled for the 12th of September. Stay tuned for the full announcement sometime next week. In the meantime, you can signup for the placeholder here:

SETUP

Breakfast Club Member, Nandini Mullaji (Dini) came to me last week with a big problem - her dating app has too many women on it and too few guys. If you’re a smart/ambitious guy looking to date, then use the code below to skip the waitlist.

Get off your phone and get setup on a date with someone awesome, this week

Tired of endless swiping and awkward messages? Want to skip the small talk and skip straight to the date?

Then join SETUP, a members only NYC dating app where you get set up with someone you're into at a cool spot around the city.

Sign up now and skip the 5k+ waitlist with the code BREAKFAST CLUB.

Breakfast Club Member Spotlight: Alex Pattis

I stumbled upon a secret that I need to share with the world. Alex Pattis is a legit assassin and no one knows about him. I only met Alex because we co-invested in Intros.ai. The guy, despite doing $60 million dollars in SPV’s the last couple of years, hasn’t done a single podcast. He has 39 followers on Twitter. And the only piece of news I could find about him was his engagement announcement.

Insane. I finally tricked him into sharing more of his story. I have so many more questions. But this, at least, is a start.

It’s an understatement to say you keep a low profile. You’ve put together a ton of SPV’s over the last couple of years with a super limited social media presence. How many millions of dollars of SPV’s have you done?

So, it's about 60 million now, but it certainly took a while to get there. And it was kind of a three-ish year ramp up to figure out how to put it all together, get the right LPs, do the right deals before things started to work in a meaningful way the past 3+ years.

Okay, so I spoiled the story – you’re successful. But SPV’s are pretty difficult. You go deal by deal, convincing each investor. Add in that when you started out, you weren’t exactly an insider – you didn’t have some sort of huge edge.

So for background, right, I did have, I guess, at the time, eight years of experience across two different super early stage startups. One I joined as the 11th employee and 1st business hire. It was a data analytics company selling into life sciences. I helped that company grow for about three years. There was an acquisition. Not the most amazing acquisition. Then I moved over to a second company where I joined as the first employee, pre-launch/idea phase essentially as early as you could get.

We built out a market research platform that sold into life sciences and innovated on a traditional consultancy based model to get insights from global payers, those making pricing reimbursement decisions.

And yeah, built a great, great business, great platform, all the like typical startup chaos upfront - selling the technology dream and fulfilling it with manual processes before the product was actually working. We bootstrapped that business, grew it profitably for about five and a half years. Then, we sold to private equity in November of 2020, which was a really good outcome.

I got curious with all the cool companies and entrepreneurs I met, and really just grabbed the bull by the horns to start investing in startups where I began as a very small angel investor for a year, figuring out how to find deals, joining some syndicates, and writing really small personal checks until I kind of got to the point where I was like, “hey, this SPV/syndicate model is a lot better when you're running the deal. Let me try and put some of these deals together.”

And that was the start of a two-year journey of really struggling but figuring out how to meet the best founders, get allocations - actually have an LP base that's interested in more than just one deal. Building out more of a repeatable process and being value-add to these founders - have them be enthusiastic about having me on the cap table at the earliest stages. And, you know, that whole process of putting it together, really didn't work out all that well, it probably was not a great hit rate for the first one or two years, but I was able to kind of, I guess, not give up. I definitely met some people who were extremely helpful along the way, whether it was co syndicating or introducing me to other investors who want to participate in deals and, and then also leveraging AngelList, which had a really great - and still does - platform to take on a lot of the burden. You know - the tax and accounting and K1’s and stuff like that. So. Yeah, that was the backstory ramp up to actually being able to get into deals, fill out allocations on a much more repeatable base, and doing a lot more deals over time.

I remember you telling me about doing a lot of information gathering at first – you interviewed a bunch of different Angels and VC’s -

When I first was angel investing, and my check size was so small and insignificant, I was trying to navigate how I could actually be helpful. My check size certainly wasn't all that helpful.

I kind of wanted to wedge this position where I was this angel investor who could be helpful with intros to more institutional VCs - folks that would lead a round, set terms, fill a round, or be helpful for the following round.

I spent so much time networking with other VCs and positioned myself as this deal flow guy which kind of helped founders with access to capital and VC’s with access to early-stage deals “Hey, I really want to learn more about you and your fund and figure out where you all invest, what deals you look for, because I'm seeing a lot of deals. And we'd love to make intros to the companies of interest.”

And going in without really knowing much about VC or early stage investing, it was an amazing opportunity to get awesome people on the phone, ask them questions and learn from them. So as I started to do that, I was learning so much on each VC call which motivated me to grow my network and continue to learn from everyone. That was pretty instrumental in learning a lot of the game through just talking to folks in venture.

So you start developing your value proposition for companies. You start networking, creating these relationships. And then at the same time, now, there are providers for SPVs. Once you saw AngelList, did you immediately realize the impact that would have and how valuable that would be to you?

To be honest, I don't think I realized it at the time because there's the front-end piece to put the deal together, but then there's the management of the SPV, which you're not going to really experience until you're actually doing the whole SPV process.. I truly did not realize how important SPV logistics were pre & post-investment.

You're at 200 companies, actually more –

It's probably a little bit more, and way more individual SPV’s. But also keep in mind we've doubled, tripled, quadrupled down on a handful of companies as well.

This didn’t happen immediately though, it took time -

It definitely did not happen immediately. It took a while to build up an LP base that was 1) interested in deals and 2) could support more deals. And it also took an understanding of the types of deals, the stage of deals that resonated with our LPs. SPV’s are a very different game than a traditional fund. In raising a fund you're raising capital upfront on a specific thesis and then deploying what was already raised, whereas, in SPVs, every deal is its own raise, its own story, and its own process to pool capital together

What does that look like in practice, as the cycle has progressed, and your deals have changed?

A couple of things that stick out here.I think we like more efficient technology companies like b2b SaaS, marketplaces, Fintech, whereas earlier, we did those but also a healthy amount of consumer/CPG companies... Another item is the importance of co-investors. We don't have the brand of a strong tier one VC by any means. So investing alongside folks that we know and trust and lend somewhat of a stamp of approval on the deal is meaningful to our LPs. Obviously, that's not the only part of the deal, but it's certainly a meaningful part of the deal (in addition to the obvious like team, growth rate, market etc.

Reflecting on the first couple years of the journey is there a moment that stands out? Or an inflection point?

Great question - I did the stuff that did not scale, like Paul Graham encourages. The SPV process for Pair is a good example - they recently raised a series C and are continuing to crush it but at seed I really went out of my way to secure & fill the allocation we had.

In early 2019, I had met Nate and Sophia, the founders of Pair Eyewear and I was pretty immediately excited about the company and opportunity ahead.. They were building a DTC eyewear company with patented magnetic frames. It felt really well suited for a strong repeat customer unlike other eyewear companies. You would buy these frames, and then have these $40 tops with all sorts of different designs and licenses. At the time they had minimal revenue, maybe like $10k monthly.

How did you meet Nate and Sophia?

I got introduced to them via a VC at Bolt who I believe was leading or co-leading the round. The terms were already set and there was less than $200k remaining in what I believe was a $2m round.

The business was not obvious then and both Nate & Sophia were 1st time founders, right out of college, but they had me bought into them and I was very interested to participate in the round.

What did you do to put the SPV together?

I felt we had built a pretty good relationship pretty quickly. Pretty random but I still remember meeting them at the Edition by Madison Square Park on a Saturday and the bartender giving us free mimosas for no reason -

[Alex giggles nostalgically]

In order to actually put the SPV together, we scheduled a time to do a founder meet-n-greet for LPs that were interested in my network. We planned this to take place in the common room at my apartment building in NYC.

I ended up hosting about 10-15 LPs and it was actually pretty great. Literally everyone had questions for Nate & Sophia. I felt they did a great job of answering specific and longer-term thinking type questions. My favorite question at the very end was, “So, what do you need us for? Sounds like you guys are going to crush it”.

Their answer (even better to me) was “We just like Alex and want to have him involved”. For an up and coming angel investor/Syndicate lead, that meant a lot.

Anyways, some of the folks ended up investing and are now up 62x on the valuation multiple. I’d like to think everyone who did not invest deeply regrets it.

[Laughter]

One other awesome piece to this SPV story. We ended up bringing in Matthew Dellavadova (NBA player on the Cavs w/Lebron at the time) who was tremendously helpful to them. He very quickly helped them accelerate their partnership with the NBA and unlock a few additional doors.

Sounds like you were the last capital in that round and Pair has gone on to raise a couple more times?

It’s one of our best performing portfolio companies with the leanest growth story since then (and throughout the pandemic). They went on to raise a series A led by Javelin, then a series B by NEA, and now a series C to be announced in the near future. While the funding announcements are always great, the performance of the business has been even better imo.

Okay, so how do you go from scraping together a ~$150k SPV, hustling to just get a dozen people together in the lobby of your apartment building for a meet and greet, to doing $60m in SPVs?

Hard work, meeting great people, and a lot of luck. From there, I started working harder on my network to both see more deals but also share a ton of deals to stay top of mind with other VC’s, angels, syndicate leads.

The more quality deals I did, the more I attracted new LP’s. I also started to co-syndicate deals with other syndicate leads which helped 1) exposure to more LP’s and 2) enabled additional deal flow from other syndicate leads wanting to work together.

LPs started to refer others my way, and I think many folks loved the opportunity to participate on a deal by deal basis and actually get to pick deals versus traditional funds where you don’t have a say or the same level of exposure to a specific deal.

My Newsletter partner Zachary Ginsburg and I wrote a great piece on how to scale a syndicate here.

In summary, the deals I was participating in were generally high quality, the people I met and collaborated with along the way were tremendously helpful, and the market was hot and people were putting loads of capital to work.

So I saw you started a newsletter to share some of the learning & stories over the years doing SPV’s, how’s it going?

Yes, I partnered with Zachary Ginsburg to start a newsletter called Last Money In. We started this in hopes it will be the most actionable venture capital newsletter. The goal is to teach readers how to be more informed VC investors & actually gain access to the venture capital ecosystem, both as SPV/Fund managers and limited partners.

We see a lot of great venture capital content to consume, but it still feels like an insiders game in that if you're on the outside, you don’t actually have access to deals, so there really is not much to do.

With Last Money In and our SPV/Syndicate approach, we can actually provide readers with actionable deals to evaluate, potentially invest in, and ultimately enter the venture capital asset class, all while learning on the way.

You can see some of our recent posts here:

• Playbook to Launching a Syndicate

• How I grew our syndicate to over 6k LPs

• Leveraging SPV’s to Get to Fund 1

• How do Syndicate Leads Source Deals

• Economics of $200M AUM as a VC Syndicate GP

Hey - if you made it this far - reply with “Nostalgic Giggles” or anything else
I appreciate you