Nurturing and Expanding Angel Investing from Scratch: BANA Angels and its Mission
by Sona Mirzoyan, Head of Communications at BANA Angels
With the disruptive and impressive growth of the tech ecosystem in Armenia, new startups suggesting innovative and cutting-edge solutions have started to emerge. The process was also supported by many 1st generation exited entrepreneurs, corporations and the strong Armenian talent pool.
Armenia has always had what it takes for tech to thrive. The first computer in the USSR was developed in Armenia. Currently, 582 Armath laboratories provide free engineering education to 15,000 school students aged 10-18, and chess is a mandatory curriculum in all public schools. There are 9 Tumo Centers in the country that provide free tech and design education to 20.000 students aged 12-18. Since 2006 tech industry output has grown 20-25% per year. Global Innovation Index 2019 ranked Armenia as the first among the upper-middle income countries in terms of innovation performance- ahead of China, Romania and Belarus. Besides, a number of international tech giants, including Synopsys, Epam, TeamViewer, Adobe, Cisco, Siemens, DataArt, etc, moved their R&D and engineering to Armenia.
Armenia’s strong educational system, with a particular focus on science and engineering, has also played a key role in the development of the tech industry. The country has a high number of skilled engineers and developers, and the government has invested heavily in STEM education and research.
In these circumstances, there was a clear need to develop angel investing as an important source of early-stage funding for startups to support innovation, contribute to the development of the labour market, and drive economic growth. In 2017 the first Armenian angel network was founded, BANA Angels.
BANA Angels is a network of angel investors with strong tech backgrounds, including successful founders and entrepreneurs from Armenia and abroad. Besides capital, the members bring their expertise, experience and network to influence the success of the startups we invest in.
BANA Angels puts effort into creating value both for investors and entrepreneurs by uniting accomplished business angels from around the world and connecting them to promising startups. The investors do not simply get an opportunity for financial return. Our team is doing an initial due diligence on startups and working with them to make sure they are properly presenting their product at our pitching sessions. The deals we give access to are well-researched, and members of our network have a wide range of expertise from different fields, which makes the overall process advantageous.
Currently our portfolio includes 25 startups, including Docus, Prelaunch.com, Himnark, AimStack, EasyDmarc, Lucky Carrot, Expper Technologies, doodooc, Cauldron, Zoomerang, Mythril, PlayEngine, WildLearner, Regnest, CoinStats, Grovf, Docus, Manot, 4u.am, Birstly, eShot Labs, Wolterman, ViralMango, Armbionics. From the list provided, there are several notable investments that BANA Angels has exclusive rights to as the only angel network that invested in them. In total, BANA Angels has invested $3 million or more.
Since 2017, we have organised several projects and programs aimed at developing the startup ecosystem and tech industry in Armenia. These include the ‘Neruzh – 2019‘ interactive five-day bootcamp for entrepreneurs of Armenian descent, the Beeline Startup Incubator in partnership with Veon Armenia, the SAP Startup Factory in partnership with SAP and EU4Business, and the #TalkAround events.
BANA Angels has also organised several SME mentorship programs like BuildUp Lori, “Koriz” idea competition and Tourism Innovation Academy for businesses in industries such as tourism, agriculture, and manufacturing operating in the regions.
All aforementioned projects and programs led us to establish The Factory, BANA’s innovation hub, where bright ideas are born and developed. At The Factory, we focus on empowering young entrepreneurs and creating an all-encompassing space for sharing ideas, networking, and collaborating, which can hugely contribute to the further development of the Armenian tech community.
We hope that BANA’s contribution to the Armenian tech ecosystem will further contribute to the development of angel investing culture and the startup movement.
By Caroline Sai, Head of Angels Santé & EBAN Board Member
Just a castaway, an island lost at sea, oh
Another lonely day, with no one here but me,
The lyrics to one of my favourite songs Message in a Bottle from Police translate well what startups feel like when fundraising.
In one of my previous posts, I motivated fundraising entrepreneurs to rejoice when an investor gave an answer (negative or positive) as “there is nothing worse than being completely ignored and being stuck in limbo”
The strange phenomenon where investors need deal flow, entrepreneurs need cash and yet the communication channels are obstructed by …. Guilt, annoyance, anxiety, and rejection?
Our inboxes are like a petulant 3-year-old that you can’t ignore, but you so wish you could.
Though you know that you should limit your access to your inbox to 4 times a day for maximum efficiency, it seems that our emails are forever an extension of our fingers.
Remember this morning when you were waiting for that answer, and you were constantly refreshing your browser?
Did you give a thought to that other guy (or gal) also refreshing his/her browser in an attempt not to face the reality of being completely rejected after that simple attempt to get your attention?
Important reminders to all those that have had the kindness of reading till this paragraph: Psychologist Alice Boyes Tells us that Avoiding coping leads to increased Anxiety.
Did she mean just the one not answering the email? We should probably warn her that anxiety on the receiving end is very high as well.
It increases the sense of rejection, self-doubt or overall confusion: have they seen my email, did it go to the spam box, should I wait to follow up?
It’s almost like knocking at a door, knowing the person is inside and leaving with a sense of unjustified dismissal when silence and a closed door are the only response to your friendly knock.
Even worse, it’s like holding a hand out to introduce yourself, and that person leaves you with your hand hanging in the air. I’ve experienced it, and believe me when I say it stings!
I may be old school, but answering an entrepreneur who has taken the time to do their homework seems like common courtesy, even more so when we’ve looked at their deck or had a call with them. We may feel in a dominant position as investors, but we make a living from investing in the best companies. So, let’s not shoot ourselves in the foot.
We advertise our search for qualified deal flow, and yet we so easily ignore entrepreneurs when the time if off for us or simply when that sparkle of discovery is no longer there.
How long does it actually take to type “thanks but no thanks “?
I’ve timed it: 6.48 seconds exactly.
We know that unmet expectations lead to frustration, and here is a funny video* that illustrates what our non-response may result in. Watch it, enjoy it and let’s remind ourselves that behind typed words is a person with expectations and hope …. Just like us.
*Was it a date The New Yorker https://youtu.be/cZARdRcbh_E
About the Contributor
Caroline Sai is the Head of Angels Santé (Angels4health) & EBAN Board Member. The EIT Health Investor Network is a European network of healthcare investors dedicated to supporting healthcare startups in their fundraising journey. It is a network managed by Angels Santé and co-financed by EIT Health. To learn more about how to join our program as an investor or a startup, click here
The DanBAN member survey stands out for its ability to offer a comprehensive understanding of how private investors fund growth companies in Denmark, and it is unique in its approach to measuring impact. This is because all DanBAN members are required to participate, resulting in a 100% response rate and a survey of exceptional quality. Enforcing the reporting requirement entails losing 1-2 % of members each year due to non-compliance.
Total investment:
In 2022, Direct investments from DanBAN members of €60,6 mill. which is a new record and up 12 % from 2021. Vækstfondens BA-matching loans amounted to €18 mill, down from €19,8 mill in 2021.
DanBAN members thus provided startup and early-stage companies with more than €78 mill. in financing in 2022.
Read the full report below.
EBAN and HRP hosted a pitching session on March 30th 2023, aimed at driving investment in the cleantech sector and facilitating connections between entrepreneurs and angels. The event was a success, building on the partnership between the two organisations that was started through the previous year’s event.
Our jury and mentors, including Tina Dreimann (Founder of Better Ventures), Ukko Kilpinen (Startup M&A manager at Fortum), Nicolas Kulakowski (President of SID Network), Rita Sakus (Board Member at LitBAN), Alexandra Nitzlader (Regional Manager Austria & Transaction Manager at FASE), and Helmuts Lejnieks (Board Member at EBAN), selected the six showcased companies: W-Energy, BOLDR, WAISENSE, OCO, Scrufy, and BIPV.world.
They ensured that only the best and most promising entrepreneurs made it to the (virtual) stage. These entrepreneurs have received grant funding, making their companies the perfect choice for angel investors looking to de-risk from a technological point of view and invest in promising companies focused on commercialising their products.
To prepare the entrepreneurs for their pitches, EBAN organised mentoring sessions that included a “How to Craft a Killer Pitch” workshop led by Audra Shallal, Partner at Corenvest and EBAN Board member. The workshop gave the participants some of the best practices and tips for pitching their startups. Additionally, pitch dry runs were conducted where entrepreneurs could practice their pitch in front of a panel of investor mentors, who gave specific feedback on improving their pitch and/or presentation.
The event was well-organized, featuring a structured format that allowed each entrepreneur to showcase their product in a 7-minute pitch, followed by a 7-minute Q&A session with an expert jury. After completing all the pitches, the audience and the jury voted for their favourite.
BOLDR, an energy efficiency as a service platform with a focus on home climate, emerged as the clear winner, securing both awards. As a reward for their outstanding performance, BOLDR has been granted the opportunity to pitch at EAIS 2023, providing a platform to showcase their innovative products to a broader audience.
EBAN and HRP are committed to supporting entrepreneurs and investors in cleantech; the event was an example. In addition to the pitch session, both organisations facilitated introductions between entrepreneurs and investors interested in backing the next big thing. With the event recording available on the event website, anyone can get a chance to watch the pitches and learn more about the companies involved.
In conclusion, the pitching session was successful, with entrepreneurs showcasing some of the cleantech sector’s most promising technologies and products. The event allowed investors to identify startups and entrepreneurs to connect with potential backers, creating a win-win situation for everyone involved. Additionally, we are pleased to announce that we are assisting companies in communicating with investors, and meetings are being organised. If you are interested in meeting with any of the startups, please contact us. We look forward to continuing to facilitate connections and support innovation in the cleantech industry.
The European venture capital (VC) market picked up and proliferated after the 2008 economic breakdown but faced a sharp slowdown in the second half of 2022 and 2023. Starting the recovery from the impact of the Covid-19 pandemic, Russia’s invasion of Ukraine elevated geopolitical tensions and caused a global economic slowdown. As for many other industries, the increasing macroeconomic volatility, with rising inflation and supply disruptions, has severely affected the venture capital market.
At the same time, groundbreaking changes are taking place in society, not least the emergence of new technologies, that create opportunities for VC investors. Artificial intelligence, blockchain, and deep-tech are just a few. The investor landscape for startups is also changing rapidly, with new types of investors entering the scene, such as new forms of corporate VCs, special purpose acquisition companies (SPACs), and super business angels.
To get a better understanding of the VC landscape, leading European business schools and universities have joined their efforts and conducted a broad study of VC practices in Europe. In this report, they present their findings on how European venture capitalists select, value, and structure investment deals, what type of value-added activities they provide, and how successful they are with their investments.
Read the full report below.
Czechs are among the most skilled investors in startups. Their strategies have generally been successful so far. Almost nine out of ten investors were able to make a profit on their investment, with nearly 12% making more than ten times their investment. Two-fifths of investors consider investing in startups more profitable than other forms of investment. These are the findings of a survey conducted by investment group DEPO Ventures, which is building a unique syndicate of angel investors in addition to angel funds. The survey was also conducted in partnership with the law firm Havel & Partners and the agency CzechInvest. The aim of this fourth annual survey was to map the environment of angel investing in the Czech Republic.
Contrary to the widely accepted rule that a large percentage of startups fail, the survey suggests that investments have mostly been successful so far. About two-fifths of investors (41%) consider the performance of their investments in startups to be higher or equivalent to other asset classes. Exit has already been achieved in some of their investments by about 40% of investors, with the number of investors who sold their investments increasing by more than 10 percentage points compared to last year. Almost 86% of them sold their share at a profit. Investments were most commonly evaluated once to five times (51.4%).
Read the full report below.
Lars Rasmussen, co-founder of Google Maps and angel investor in Canva as well as EBAN Congress 2023 keynote speaker, recently sat down with EBAN for an interview ahead of his appearance as a speaker at the upcoming EBAN Congress in Thessaloniki.
“Difficult times create strong people and strong people create great startups”
The Danish software engineer, entrepreneur, and angel investor discussed his background as an entrepreneur and investor and how he and his brother were inspired to create Google Maps. He shared how they were both laid off during the dotcom bubble burst and decided to pursue one of his brother’s many startup ideas: to improve online mapping with bigger, prettier, and faster maps. The two of them built the platform with no money while living in a room in a shared house and maxing out their credit cards. However, they were introduced to Google, which eventually acquired their company and turned their prototype into Google Maps.
His next venture, Google Wave, attempted to modernise email by making it more collaborative and efficient but was discontinued in 2012. Rasmussen spoke about the challenges of being an entrepreneur, including the highs and lows of launching something that becomes a blow-away success and the lows of failing in public. Lars also compares the experience as an entrepreneur to being on a roller coaster ride.
“When you’re trying to be an entrepreneur, it is a roller coaster, right? But when you’re an angel investor, you are riding ten roller coasters in parallel.”
As an angel investor, he invests in many different start-ups, so his mental state is generally more stable than that of a founder who is fully committed to one company. He mentions that the pandemic has affected some of his investments, with some start-ups struggling to survive while others have seen accelerated growth. Overall, he finds angel investing to be a more stable and less intense career than being a founder, and he enjoys giving back to the entrepreneurial ecosystem by supporting the next generation of start-ups.
As to his experience with Canva, his most successful angel investment to this day, Lars recalls he invested in Canva only after working with them for a year and being impressed with their vision, their tenacity, and their potential to be a $40 billion startup – in short that they had what it took! He also liked the vision because of his personal relationship with design and his brother’s design skills that had helped Google Maps become successful. Despite Canva having faced many challenges, Lars knew the founders were determined and believed they could execute their vision. Unlike Zoom or Peloton, which experienced explosive growth during the pandemic only to see a decline after it ended, Canva’s growth trajectory has been consistent and sustainable. Even as the pandemic recedes and the economy faces challenges, Canva’s growth has not been impacted and continues to thrive.
“I’m 100% convinced that five years out, Greece will be one of Europe’s most important startup centres, if not the world.”
The #EBANCongress speaker talks about the significant growth in the Greek innovation ecosystem since 2012, which is due to hundreds of startups, active local VCs, and government support with new laws and tax incentives. He believes that if this growth continues, Greece will become one of the most important startup centres in Europe, if not the world, in the next five years. Lars mentions that half of their investments now are in Greek startups; he and his wife are trying to help keep this growth going. He also highlights the need to push marketing efforts to promote Greece’s tech ecosystem to the world, citing that the product is way above the market. Lars mentions the unique position of Greece for growth, and he attributes it partly to the crisis, saying that difficult times create strong people who create great startups. Lars also talks about the government’s efforts to improve the ecosystem, such as the digital ministry’s effort to digitise the bureaucracy of Greece and the new visa laws being debated that will make it easier for techies, entrepreneurs, and investors to come to Greece. Additionally, the government allocated a big block of abandoned factories in Piraeus to turn into an innovation district, a central gathering point for all the startups with cheap office space, a funky modern industrial vibe, and a place for continual events. Lars also talks about the advantage of living and working in Greece, such as the islands and the great work-life balance.
According to Lars, his investments focus on sectors where it can add value, such as healthcare, fertility, and education. The team of the invested companies is a crucial factor, and the team members must have tenacity and an unwillingness to give up. The company also looks for visionary women entrepreneurs, and investments that have at least one woman founder have proven to have better unrealized gains.
Lars advises entrepreneurs considering starting a business to try and talk themselves out of it. They should only become an entrepreneur if they feel they can’t help themselves and are unable to stop thinking about the idea. Lars also advises entrepreneurs to be aware of their competitors and to not underestimate their capabilities. Lastly, Lars stresses the importance of a work-life balance, mentioning that it is essential to do work that you love, and to create a work schedule that allows for leisure time.
You can watch the full interview below
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To get more insights from Lars and other amazing speakers (https://ebancongress.com/speakers-2023/), join us this May for the largest and most recognised angel investing event in Europe: #EBANCongress – get your ticket while early bird prices are still on: https://ebancongress.com/tickets/.
Ahoy mateys! Set sail with EBAN on the EU-LAC Digital Accelerator ship! Have ye heard of it? EU-LAC Digital Accelerator is a treasure of a project that aims to promote innovation and digital transformation in the Latin American and Caribbean (LAC) region.
The EU-LAC Digital Accelerator initiative is a project that brings together private sector stakeholders and beyond to accelerate digital transformation in two ways. First, by promoting engagement on digital issues between the EU and LAC. And second, by reinforcing the EU’s role as a key partner and player in the digital area of LAC.
Now, business angels are the key to unlocking the treasure chest of digitalisation in the LAC region, and that’s where EBAN comes in! The digitalisation of businesses can make them more efficient, productive, and competitive, expanding their reach by targeting new customers and markets. It helps them stay ahead of the competition by adapting to changes in the market and responding to customers’ needs. By supporting digitalisation in the LAC region, business angels can contribute to a more vibrant and dynamic business environment that benefits everyone involved – businesses and customers.
EBAN and our treasured project partners must chart a course and identify high-potential digital areas to collaborate with partners from the EU Member States and LAC. They will develop entrepreneurial projects that leverage the cooperation of EU and LAC partners in these areas, providing tailored acceleration services to support the collaboration and development of sound business cases. They’ll also hoist the sails, bring digital projects to an investor-ready level, and connect them with relevant public and private investors to enable businesses financially.
To find the X that marks the spot in this project, we must navigate the choppy waters of stakeholder management. We will develop a stakeholder map by identifying key stakeholders such as partners, incubators, accelerators, investors, and other organisations involved in the project and conduct a needs assessment to focus on areas where the project can make the most impact and ensure that resources are used effectively. And to attract potential participants, including start-ups and other organisations that can benefit from the project’s acceleration services, we will need to cast a wide net and advertise an open call for acceleration.
So hoist the mainsail and join us on our quest for digital treasure in Latin America and the Caribbean! We’ll make a crew of scallywags and landlubbers into savvy sailors and turn their businesses into digital gold. Arrr!
Project Partners
- Tecnalia ( project coordinator): Research centre | Technological development | Tecnalia
- Tecnalia Ventures: TECNALIA Ventures | Tecnalia
- IESE: IESE Business School: World Leader in MBAs & Executive Education
- WAYRA: Wayra España: Escalamos startups
- EBN: EBN | EU|BIC Innovation Community – Community of certified EU|BICs, the European Business and Innovation Centre Network
- Expertise France: Accueil – Expertise France
- Caribbean Export: Home | Caribbean Export (carib-export.com)
- IDB Lab: home | BID LAB
- Tecnalia Colombia: Centro de investigación | Desarrollo tecnológico | Tecnalia (tecnaliacolombia.org) ……
This project is funded by the European Commission NDICI LA 2022 439-102 Grant Contract
This is part II of EBAN’s interview with #EBANCongress keynote speaker Marcia Dawood of ACA. To catch up the part I of the interview, click here! And to get more insights from Marcia and other amazing speakers (https://ebancongress.com/speakers-2023/), join us this May for the largest and most recognised angel investing event in Europe: the EBAN Annual Congress – get your ticket now: https://ebancongress.com/tickets/
EBAN:
Thank you so much for being here, Marcia, and thank you for agreeing to do this interview with us to prepare for the upcoming EBAN Annual Congress in Thessaloniki this May.
We know you have extensive experience in the early-stage sector, and we want to know the biggest lesson you have learned since becoming an angel investor.
Marcia:
The biggest lesson is that it takes a lot of time and is tough. Sometimes, angels will participate for a while and then move on to something else. So it’s essential, during the investing process, to know that we’re in it for the long haul. We should have people surrounding the company, even if we can’t physically do it ourselves because we have other investments. But at least we know what the company needs, and we can make introductions or give them some of the support that they could use.
EBAN:
Which sectors should we watch as an investor in 2023?
Marcia:
So much is happening right now in AI and machine learning. We’ve seen a lot of that lately, but it’s still very early to say. We’ll see many things come and go, and some things improve. I’ve also seen more innovation than ever in healthcare. Especially right now, women’s health is getting a lot more attention. That’s exciting. We’re always going to see technology of all kinds continue to evolve, and it keeps evolving faster and faster. It will be interesting to see where things are a year from now.
EBAN:
What do you consider a significant challenge in the investor and startup relationship?
Marcia:
One thing that gets challenging for all angels, no matter where you are, is whether or not angels will follow on and continue to invest in the same company. That’s where many companies get into trouble because they need the funding after the angels get involved. Sometimes they either don’t communicate how much they’ve accomplished or maybe they have yet to hit the milestones they wanted to or they’re spending money too fast, or whatever the story is. And then they go back to the angels to follow on. Either the angels aren’t that excited about them anymore, or maybe they weren’t paying attention to that particular company enough. It happens all the time. I think it’s just important that we keep thinking about that. Companies need to get information back to investors on a consistent basis. At least quarterly. If companies only communicate when they want money, that’s not good.
EBAN:
As mentioned in the beginning, you’re coming to the EBAN Annual Congress in Thessaloniki this may, which we’re excited about. We would like you to give us your opinion about the European Angel ecosystem.
Marcia:
I’m not an investor in companies outside of the US because it gets complicated with our tax system here in the US, which is different from others. But last year, when I came for a conference, seeing so many incredible brands and how many different companies Europe has was amazing. It was fantastic to see how the countries cooperate. Specifically in Greece, there’s so much happening there right now, and I don’t think people realize that. It’s important to keep talking about it and highlighting this. I’m excited to come back again this year and see it from an even bigger perspective because last year I came for HIBAS, which was a smaller event, but this year, it is even bigger, so that’s fun.
EBAN:
What are your insights for the Mediterranean ecosystem, Southeastern Europe and Balkan ecosystem from what you got from that event?
Marcia:
The ecosystem is vibrant and diverse, and I’ve seen more than just early-stage companies. These companies are now gaining a lot of traction throughout Europe, not just from countries in the region. It was cool to see the wide range of companies that have emerged and gained more visibility in recent years.
EBAN:
Are there any specific trends emerging among both entrepreneurs to be able to find investments, such as co-investment from other countries or any trends amongst angels to be able to keep investing despite the atmosphere?
Marcia:
I’ve seen more angel groups putting funds together within their own group. It’s becoming more popular because it allows for diversification of portfolios, lessens risk, and provides more people to help that particular company move forward.
EBAN:
You mentioned some cases where you are unsure about a company, but it turns out to be really good. Do you have an example to share with us?
Marcia:
I invested in a pharmaceutical company a couple of years ago, which is a challenging sector, and some angels would never invest in it. But the company is doing super well now, and our valuation has increased three times. The drug is still not on the market yet, so we still have a little ways to go. But it’s different from what I had thought when I invested. I liked the company and the founder and knew it would take a while.
EBAN:
Are there any closing words you want to leave us with?
Marcia:
I’m excited to come to the Congress, and I have a new rap battle that I’m working on about the price of equity and convertible notes. See you in Thessaloniki!
EBAN:
Can you tease the topic?
Marcia:
Yes, it’ll be about the price of equity and convertible notes. It is a rap battle again!
EBAN:
We’re looking forward to having you as well, and we’re really looking forward to the event in general. Thank you so much for doing this interview with us and being our keynote speaker. See you in Thessaloniki then!
Marcia:
That’s awesome. Thank you, guys.
