Bitcoin startups

[gweedo]

Remember bitcoin startups there are others people who are accredited investors other than Erik and Roger. I really feel they get every deal, and I get invites to invest in a silk road marketplace. So bitcoin startups remember there are many investors who can bring a lot of talent and money to companies.

[guybrushthreepwood]

I'm confused about what this is about, but getting offers to invest in a Silk Road style marketplace seems pretty dodgy to me.

[MakeBelieve]

I have always wanted to invest in a Bitcoin start up but can never find any which are interested I would never invest in any thing which is illegal though for example silk road.

[darkmatter7]

Bitcoin Startup Here 

Messaging you guys!

[gweedo]

I'm confused about what this is about, but getting offers to invest in a Silk Road style marketplace seems pretty dodgy to me.

Ok Erik and Roger just invested in a company that is looking to be the "coinbase of europe". They always get great deals to invest in great companies in bitcoin. I am an accredited investor so I can invest in angel rounds of startups. Yet my inbox only gets investments in the ideas that are worthless. So I just wanted to make the community aware that a lot of us can bring a lot of talent and money to startup if they lets us invest.

I have always wanted to invest in a Bitcoin start up but can never find any which are interested I would never invest in any thing which is illegal though for example silk road.

Yeah exactly this, I invested in a few it was so much fun. I know but I get those offers, like a hobo in the back of the dumpster i am getting the leftovers of the leftovers.

[MakeBelieve]

I'm confused about what this is about, but getting offers to invest in a Silk Road style marketplace seems pretty dodgy to me.

Ok Erik and Roger just invested in a company that is looking to be the "coinbase of europe". They always get great deals to invest in great companies in bitcoin. I am an accredited investor so I can invest in angel rounds of startups. Yet my inbox only gets investments in the ideas that are worthless. So I just wanted to make the community aware that a lot of us can bring a lot of talent and money to startup if they lets us invest.

I have always wanted to invest in a Bitcoin start up but can never find any which are interested I would never invest in any thing which is illegal though for example silk road.

Yeah exactly this, I invested in a few it was so much fun. I know but I get those offers, like a hobo in the back of the dumpster i am getting the leftovers of the leftovers.

Where do you normally contact these people just out of interest I might take a look to see if I can jump on anything I just look at these forums hoping to find a good startup.

[DeathAndTaxes]

Having just gone through this from the other side of the fence I thought I would share some perspective.  The reality is no successful startup founder wants hundreds or thousands of investors.  Contrary to the silly games you see on "crypto exchanges" with startups issuing billions of shares to thousands of investors no founder wants that.  Less is better when it comes to investors because it means less overhead and more time spent on the business.  The perfect offering would be one where a single entity provides all the capital you could need, has the ability to fund all future rounds, accepts your terms, has unmatched connections in the industry, and the cost of capital makes them a minority owner.   Of course that almost never happens but that is what a founder wants (a guy can dream right).

The private equity rules in the US are draconian, so the odds are unless you have contact with the company before the start looking for funding you aren't going to learn about it until after the deal closes. In our case I planned on it taking 30 days (maybe 60 as a worst case scenario) to raise the funds we needed.   It took four days.  Getting the PPM done took far longer.  For many potential investors they are not interested in a deal below a certain amount, because their time (due diligence and possible board participation) isn't worth it for a smaller amount so most offerings end up being a smaller number of larger sales than a larger number of smaller ones.

Some tips for potential investors in bitcoin startups (not saying you don't know this Gweedo, just figured it might be interesting to anyone reading):
1) It IS who you know.  If you are waiting for an announcement before you start looking to invest you will not get in the door.  Hopefully it makes sense why.  I would have loved to public announce our offering, have investors compete, and grab the ten or so which brought the best non-capital contributions but the SEC simply won't let me (or any startup).

2) Start to network now.  Linked in, Angel List, "bitcoin angels" (not sure if that is the correct name we didn't work with them) are all good resources.  The more people you know the more likely you will find out about an upcoming deal "through the grapevine".  This is starting to change with SEC new rules of public advertising for accredited investors BUT it requires independent verification of accredited status and many startup portals (due to risk) aren't willing to look at Bitcoins.  So if you are Bitcoin rich but USD "poor" you may still be out of luck.  We can only hope this will change and things like Second Market's Bitcoin Trust can only help.

3) If you can try to leverage friendship with an existing angel investor.  They are going to learn of deals and they can include you as well.  If you don't have contacts in the industry this might be your single best way to learn about an offering.  Now please don't everyone go spam people like Roger I am talking about developing and maintaining existing contacts and friendships.

4) You will probably need to move fast.  In my (limited) experience, deals take forever to setup, but then close fast.  Understand this means you will have less time to do your due diligence so the risk of being defrauded is higher.  A solid network of fellow investors is a very useful thing to get some feedback before writing that check (or unlocking the wallet.dat).  We ended up oversubscribing and turning away almost as many investors as we signed.  In hindsight that may mean my mentor was right and I set the pre-money valuation too low, but even at a more aggressive valuation I think the same thing would have happened.  You may want to ask if the company will accept a non-refundable deposit (say 1%) to give you additional time to evaluate the deal.

5) Go in knowing that startups have limited financial information so they are risky, you really are investing in the leader, the concept, and the plan to execute.  Know your limitations and understand that 75% of startups end up failing.  Putting in your life savings of Bitcoins into a single startup is insanely risky.  You should have the budget, contacts, and access to make multiple smaller deals.

6) If you think cryptostock exchanges are startups then you are likely out of your league.  Private equity funding is non-tradable.  There are lockups and restrictions on exactly who, when, and where you can sell.  Many successful startups never make it to an IPO, and instead get bought by a larger player, so your "trading" history will be a single purchase of equity and a single sell when the company is acquired.

7) Even missed deals can be useful.  Most companies will rapidly outgrow the capital they raised.  It is very common for there to be subsequent rounds so that may give you a second bite at the apple.

Oh and
0) If you aren't accredited you likely are out of luck.  The rules in the US make doing business with non-accredited investors next to impossible.  It is unfair the SEC makes special rules for "the rich" but startups are caught in a no win situation.   Non compliance means you are issuing unlicensed securities without an exemption, this opens the issuer up to civil and criminal action not just from the government but from fellow investors as well if things go south (and remember 75% of startups fail).  Lets face it most of the compliance is to cover the scenario where the company fails or underpeforms.  No investor is going to say "I didn't understand the risk" when they realize a 20,000% gain on their investment.

[DeathAndTaxes]

Well in the old days, they were a lot of people that just post to the forum, now, that real VCs are taking the lead, that doesn't happen for the good companies.

Bitcoin is getting bigger and that means more scrutiny.  Even posting on a forum could be construed by the SEC as public advertising which could expose the founder to civil and criminal penalties. Private equity is suppose to be private.  Bitcoin companies in 2009 could get away with a lot more than they can in 2014.  The deals are getting bigger and that means more oversight.  In the "Pirate" case a judge ruled that a security can still be a security even if it involves bitcoins.   

If you look at my post history for the sixty days prior to our offering there was absolutely nothing from me about it.  That was intentional.  I am not saying you would have been interested in what we were offering but any other startup is going to be getting similar counsel and are going to go through a similar quiet period.  It is unlikely they will even make a casual reference "looking to expand once we secure additional funds". Done right there will be absolutely no indication of a deal on public forums.

But for good big investments those have to come your way. Hence why Roger and Erik get them all, cause they are very out in the community. I value my privacy a lot more and plus I don't want to be on radio shows and tv interviews, that doesn't excite me.

3) If you can try to leverage friendship with an existing angel investor.  They are going to learn of deals and they can include you as well.

If you know Roger gets access to the deals you are interested in, see if you can get into his good graces.  Then stay in contact and maybe he (and Roger is just an example here) will pass any info along that he comes across.

[gambit1]

I'm also looking to invest in bitcoin start-ups so feel free to give me a PM if you have a serious business plan.

[MPOE-PR]

Remember bitcoin startups there are others people who are accredited investors other than Erik and Roger. I really feel they get every deal, and I get invites to invest in a silk road marketplace. So bitcoin startups remember there are many investors who can bring a lot of talent and money to companies.

I nearly fell over laughing. Carry on, this thread delivers.

[MPOE-PR]

I don't see what the funny part is?

Let me make it plain for you then.

Aside from the amount invested, this investment round is also notable for the number of investors involved. The firm lists 15 in its statement announcing the deal, which would mean an average of $40,000 each (although the investment is likely to be unevenly spread).

Bitcoin is getting bigger and that means more scrutiny.

And assorted derpage on this thread. Hey look, fifteen people scrounged together fifty bitcoins each, this is Bitcoin getting bigger, check out how much the SEC matters and the usual pipe dreaming.

Yes, Bitcoin is huge, and growing. Not here, not with you.

[gweedo]

I don't see what the funny part is?

Let me make it plain for you then.

Aside from the amount invested, this investment round is also notable for the number of investors involved. The firm lists 15 in its statement announcing the deal, which would mean an average of $40,000 each (although the investment is likely to be unevenly spread).

Bitcoin is getting bigger and that means more scrutiny.

And assorted derpage on this thread. Hey look, fifteen people scrounged together fifty bitcoins each, this is Bitcoin getting bigger, check out how much the SEC matters and the usual pipe dreaming.

Yes, Bitcoin is huge, and growing. Not here, not with you.

And bitcoin is huge because people invest in companies allowing them to scale and grow to these huge empires.

Yes the SEC is a dinosaur and will be obsolete, but fact is I am not good at holding on to the soap so yeah...

[Ragnarly]

If you're looking to invest in projects, it would help to provide more information.

- What is your experience and track record?
- What are your general terms?
- What specific kinds of projects are you looking for? What are you not looking for?
- Besides capital, what other value will you bring to the table?

[Mentaso]

What is your experience and track record?

I have done a couple of investments only in bitcoin companies. I like to keep this private since.

What are your general terms?

I don't have general terms, since it based on the company and the person/people that are the founders. I have done everything from taking 1-5% of a company, to buying the company outright because I felt the company wasn't going in the direction it could be.

What specific kinds of projects are you looking for? What are you not looking for?

Legal, and I enjoy mostly data/technical projects since that is what I am most interested in, and have most of my experience.

Besides capital, what other value will you bring to the table?

I am an entrepreneur myself, so I know the ups and downs. I have some connections to help guide you in the areas I don't know. Bottom line I been in bitcoin for over 3yrs, I have obviously use my early adaptation to build a great career for myself, and I love to help bring people in this world the bring them to the top. I am young so I get my hustle on. I have no problem, staying up to 5am, figuring out the next steps if we have a jam or really pushing for the gold. I am probably the most passionate person in bitcoins, I eat, sleep breathe it so there isn't too much I can't help a young company do in this market.

Interesting you say that... But still ask for donations... I dont get it

[Mentaso]

What is your experience and track record?

I have done a couple of investments only in bitcoin companies. I like to keep this private since.

What are your general terms?

I don't have general terms, since it based on the company and the person/people that are the founders. I have done everything from taking 1-5% of a company, to buying the company outright because I felt the company wasn't going in the direction it could be.

What specific kinds of projects are you looking for? What are you not looking for?

Legal, and I enjoy mostly data/technical projects since that is what I am most interested in, and have most of my experience.

Besides capital, what other value will you bring to the table?

I am an entrepreneur myself, so I know the ups and downs. I have some connections to help guide you in the areas I don't know. Bottom line I been in bitcoin for over 3yrs, I have obviously use my early adaptation to build a great career for myself, and I love to help bring people in this world the bring them to the top. I am young so I get my hustle on. I have no problem, staying up to 5am, figuring out the next steps if we have a jam or really pushing for the gold. I am probably the most passionate person in bitcoins, I eat, sleep breathe it so there isn't too much I can't help a young company do in this market.

Interesting you say that... But still ask for donations... I dont get it

And it is interesting cause people still send donations

No need for me to comment further.... 

[Mentaso]

What is your experience and track record?

I have done a couple of investments only in bitcoin companies. I like to keep this private since.

What are your general terms?

I don't have general terms, since it based on the company and the person/people that are the founders. I have done everything from taking 1-5% of a company, to buying the company outright because I felt the company wasn't going in the direction it could be.

What specific kinds of projects are you looking for? What are you not looking for?

Legal, and I enjoy mostly data/technical projects since that is what I am most interested in, and have most of my experience.

Besides capital, what other value will you bring to the table?

I am an entrepreneur myself, so I know the ups and downs. I have some connections to help guide you in the areas I don't know. Bottom line I been in bitcoin for over 3yrs, I have obviously use my early adaptation to build a great career for myself, and I love to help bring people in this world the bring them to the top. I am young so I get my hustle on. I have no problem, staying up to 5am, figuring out the next steps if we have a jam or really pushing for the gold. I am probably the most passionate person in bitcoins, I eat, sleep breathe it so there isn't too much I can't help a young company do in this market.

Interesting you say that... But still ask for donations... I dont get it

And it is interesting cause people still send donations

No need for me to comment further.... 

I still don't get your comment? People donate to me and you know I donate that to a lot of people I think need or deserve it, or to Pure Bitcoin Charties. So while you probably went to the automatic I am a greedy person, that is far from the truth

I wouldnt suggest that... is that how you see it?
I just find it amusing what people say ...

[tins]

Here is a startup idea any of you may steal, I've been thinking about it for months; have no clue where to begin to implement. My background is in insurance sales.  

Start a Final Expense Life Insurance company that accepts premium in Bitcoin.
Make it simple. Only sell SPWL policies. Market to obvious target market. Younger generation is grossly underinsured with Life coverage. So, market $20K face policies. Only sell Single Pay policies. Only sell Final Expense (burial) policies. Few more details, but the general point is to keep it very simple.


Start off in 2-3 states and expand as growth allows.