Episode 17 of Net Effects Podcast features David Gardner, an angel investing #GOAT and Founder and Managing Partner of Cofounders Capital. He is also on the board of directors for numerous startup companies. David shares his ideas with co-hosts Les Ottolenghi and Mark Bavisotto — tackling everything from successful investing to finding new business ideas to what entrepreneurs need to do in the next 12 months to be successful.
David has an educational background in theology and dead languages, and this fascination with language construction likely influenced David’s first endeavors around writing early programs for hardware and software solutions. He has successfully started and sold six companies and one he “refuses to talk about it.” David’s world is eclectically modern and full of exploration and adventures in venture capital and angel investing.
- “The world is full of stupidity. You just find stupidity and you fix it.” The essential ingredient for innovating in an enterprise or startups is to find the thing that needs to be fixed, such as inefficiency, cost-effective, and overly time-consuming tasks.
- Angel investing is about learning what to look for because “they don’t really teach you the subtleties of like looking someone in the eyes and asking, ‘Is this the jockey that’s really going to drive this horse home?’” Ideas, coachability, and teams are a bunch of little things to look for, but the idea is not as important as the entrepreneur driving it.
- Success investing is more psychology than business. And it really takes about 15-20 years in the VC community to be considered a venture capitalist.
- A typical time period to exit a startup while maintaining the velocity of investment is all about the work you make after the investment. It’s a many-year commitment. When deploying capital, David’s group makes an investment every 2-3 months. He says it takes 2-3 years to find the right portfolio of 17-20 companies. It takes 2-3 years to get those companies to grow up and potentially get a good acquisition. 1/3 break-even, 1/3 loss, 1/3 win — it’s about figuring which is which.
- David wrote a book called “The Startup Hats: Master the Many Roles of the Entrepreneur”. In it, he recommends being just good enough at everything, and in the early days, you have to do it all. Business modeling is essential, “Knowing the ventures to go into, is just as important as what ventures not to go into.”
- If you are making sales, you have the runway to work your way through the other problems. Sales is being able to talk about value propositions. Sales can be every bit as complicated as computer programming, but just in a different way.
- “Whatever made you successful last year, is most certainly will not be what makes you successful the next year.” Don’t get comfortable and always start your thinking with a blank slate.
This episode also features topics around digital transformation, angel investing, and personal transformation. Listen to the full episode now.
About David Gardner: David Gardner is a serial entrepreneur, writer, adviser, and early-stage fund manager with over thirty years of experience in creating and building software technology companies.
After failing at retirement twice, David became the Triangle’s most active angel investor spending his time as a volunteer coach and mentor to startup founders and managing a free accelerator he sponsors with the Town of Cary. To combat the lack of early-stage capital in NC, David created and runs Cofounders Capital, a $12M seed fund, the success of which led to a subsequent $31M fund.
As an entrepreneur, David was the founder or co-founder of seven companies including PeopleClick (purchased for $100 million) and Report2Web, which sold for $12M in less than eleven months from inception. He has demonstrated a record for consistency across multiple industries with six successful exits in a row… and one he refuses to talk about.
David served as the Executive VP and Thought Leader for Compuware, a Fortune 1000 Corporation, after it acquired ProviderLink, a healthcare IT exchange he founded.
As a writer, David is author of a popular book on entrepreneurship called The StartUp Hats. He has published many articles and forward-thinking white papers on technical innovation, entrepreneurship and economic development. Among other firsts, David is credited with founding and launching the first software-as-a-service venture in NC.
As a lifelong learner, David is constantly researching new technologies and challenging traditional ways of thinking. In addition to several years of full-time computer science and business-related post graduate studies at NCSU, Mr. Gardner holds degrees in Philosophy and Music with a postgraduate concentration in theology and dead languages.
What drives David today is his passion for helping smart, coach-able, first-time entrepreneurs build their businesses, watching them succeed, and witnessing their life-changing transformations.