What is this?

I'm sharing an idea to start an investment fund that invests in great SaaS companies by purchasing shares in secondary sales.

The purpose of sharing the idea is to gauge a little interest. 😊

Interested in co-investing? 📩 Send me an email.

Where does this idea come from?

Founders often have a disproportionate amount of their (theoretical) wealth tied up in their own companies.

Even in the best businesses, it takes years for founders to get meaningful liquidity (either by exiting the business or being able to distribute profits).

This neglects the fundamental goal of having a diversified approach to risk.

It creates unnecessary stress for founders, which contradicts the notion that healthy founders create the best businesses.

And it forces founders to delay life goals (paying off debt, buying a home or going on that once-in-a-lifetime trip) that would be immensely rewarding.

The worst part: there is no guarantee when (and if) that meaningful liquidity could be achieved.

Way back in 2006, Basecamp sold a minority, non-controlling stake to Jeff Bezos as a way of taking some chips off the table. DHH explained their perspective at the time:

"What Jason and I got from the deal was the total confidence to go the distance. [...] We had a good thing going, and we had no interest in giving it up. But at the same time, it seemed prudent to hedge the bet at least somewhat. It was entirely possible that Basecamp could have petered out, and we’d been back to doing consulting with no residual to show for it. That wouldn’t exactly had been the end of the world, but surely it would have engendered some regret."

What is the proposed fund's investment thesis?

Giving founders some early liquidity ($250k - $500k) contributes to the holistic health and wellness of the founders, which empowers and motivates them to build a business for the long-term (which should lead to better outcomes for all shareholders).

The fund would look to invest in companies that matches the following criteria:

  • B2B SaaS (that's what I know)
  • Beyond $50k MRR
  • Growing at least ~30% YoY
  • Currently profitable or with minimal burn + clear path to profitability

Why should you even consider co-investing with me?

I'm an entrepreneur, founder and operator first-and-foremost. I like getting my hands dirty and am here to help other founders achieve their goals by building great companies.

As a founder, I also often find myself in interesting conversations with other founders, where I have cultivated long-standing relationships that has created many new opportunities. (In other words, my deal flow is unique.)

Interested in co-investing or talking about the idea? 📩 Send me an email.

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