That’s the latest from AngelList co-founder Naval Ravikant and angel investor Gil Penchina from the stage of Disrupt SF 2014 as the angels who, along with CrunchFund investor (and TechCrunch founder) Michael Arrington, held the audience rapt.
The AngelList platform has grown increasingly robust, and through the syndicate vehicles can now invest in — and lead — Series A rounds, according to Navikant.
“Once my first fund got to $4 million there were people who weren’t able to get into every deal,” says Penchina. “So we launched the SAAS Syndicate… the Bitcoin syndicate, which is doing two deals; the IoT syndicate and a late stage syndicate, which is going to compete with late stage investors.”
Both Penchina and Ravikant see AngelList as a way to democratize the venture model from top to bottom, with the late-stage fund the latest shot from AngelList across the bow of traditional investors. At issue is the dilution that early-stage investors suffer in the high-priced later-stage rounds that have become the norm in Silicon Valley (and beyond) in recent years (thanks Andreessen Horowitz).
As the AngelList syndicates grow larger, they’re also professionalizing. Penchina has eight full-time staff working on his syndicate fund along with another 30 “volunteers.” So far, Penchina has deployed $3 million across his syndicates, but expects that number to soar to $10 million over the next 12 months.”
Ravikant envisions a system that allows an investor’s fund to grow as his experience and track record evolves. “It’s a smooth path up to a fund,” from angel investment, says Ravikant. “You can add backers as you go.”
AngelList is a way to add leverage to an investor’s checkbook. It’s additional firepower to compete against the more established and well-heeled investors in the venture community, and he argues it’s a better deal for the limited partners that invest in funds.
“Institutional LPs go into individual funds now,” he says.
Now that AngelList has managed to embed itself in the U.S. ecosystem, it’s casting its eye on markets around the world. The investment platform is in the process of obtaining regulatory clearance in the UK with plans to move into Canadian and Australian markets shortly thereafter.
The only problem with the AngelList model is the problem of overtaxing resources, both men said. “I’m in too many deals now,” Ravikant said.