Friday, November 11, 2016
Interview with Kelly Perdew, Moonshots Capital
Story by Benjamin F. Kuo
Our interview this morning is with Kelly Perdew of Moonshots Capital, a Los Angeles based investment firm that makes seed stage investments in early stage companies, and in particular, for this Veterans Day, in companies founded by military veterans. Kelly is a longtime angel investor in such companies as Scopely, Bitium, UStream, Thrively, and many others. In addition to his experience as an angel investor, Kelly served in the US Army as a Military Intelligence Officer and completed Airborne and Ranger training, and graduated from West Point and UCLA.
Great catching up with you, tell us a little bit about your new investment fund?
Kelly Perdew: I've been an active angel investor in Los Angeles for a long time. I'm almost embarassed to say how long, but I think it's been fifteen years or so. I think I have personally written close to 80 checks in 52 companies, or something very close to those numbers. A West Point buddy of mine, Craig Cummings, and I, had been coinvesting with each others for the last ten years. I'd do a deal, and he'd coinvest, and then if he'd do a deal, I'd go into it. I also invested in a couple of companies that he started as an advisor or board member. A little over two years ago, we sold that last company to Daimler, just about the time AngelList started doing syndication. I decided to found Moonshots Capital as an angel syndicate through our network of accredited angels, basically as a single purpose vehicle. Some of that was on AngelList, some of that not, and we've now put a little over $7.2M into 22 companies over the last twenty four months.
What kind of investments have you been making?
Kelly Perdew: A lot of my background and current experience is direct to consumer and consumer focused Internte. I also have some experience in SaaS, video, and those kinds of companies. My partner, Craig, is familiar with mobile and mobility and transportation, and he spent the last couple of years in M&A for Daimler, after we sold his company, RideScout, to them. If we were to provide our focus, that would be it. However, we're not so disciplined on focus as we are on the management team, the size of the opportunity, and our ability to help influence and impact the company. We do lots of heavy lifting after we invest.
What kinds of companies interest you today?
Kelly Perdew: Thematically, both of us are military veterans, and we have made it pretty clear that we'll look extra hard at military veteran founders. We see most of the deals where military founders are involved. That's based on two things. One, is a little of us giving back, two, our trust and common bond with them. About one third of our investments are in military veteran founders. I would argue that's a pretty differentiated theme, plus for me anything direct to consumer or consumer Internet, which is what we get pretty excited about.
What qualities in those military veterans do you think make a good entrepreneur?
Kelly Perdew: The leadership traits that are kind of trained into you when you're enrolled in the military pretty much exceeds most of your peer group, age-wise, in the civilian sector. There's also the absolute persistence, the level of integrity, the perseverance, and those critical elements for being a successful entrepreneur. We found that having one of them on the team, from an operational standpoint, also pays off.
What's the biggest lesson you've learned over the years in terms of making a technology startup succeed?
Kelly Perdew: It's probably culture. That comes down to leadership, getting everyone on the same page, having the move in the same direction, and that makes a startup much more likely to be successful. There are lots of actors, but if you can figure that out, and get that in line, it sure does help to get success.
What's the number one most important thing you look at when evaluating a startup deal?
Kelly Perdew: Since we're at early stage, there's not usually a significant amount of information available on success and monthly recurring revenues, at least until you get into a Series A round. So, it really is about that founding team, and if it's a single founder, do they have the passion, the planning capability, and the perseverance. Those three things are the real gut check, and to understand if the plan you originally had, had is right, if you need to pivot or evolve, or if you're getting one of the legs knocked out from under you. They have to have the passion and perseverance to figure that out, which is super important.
Finally, what's the best people to approach you with their startup?
Kelly Perdew: We're seeing 100 plus deals a month, and we can be contacted at Moonshots Capital. But, the best way really is to find another of our portfolio CEOs, who can send you over with a warm intro, which will get you access and move you to the front of the line to get looked at.
Thank you, and on this veterans day, thank you for your service!