Angel One Fund has entered the top 5 Ukrainian venture funds according to AIN.ua, which invest in Ukrainian startups. It was created less than a year ago and has already made three investments in teams with Ukrainian founders.
We decided to talk to Ivan Petrenko, the managing partner of the Fund and the head of CfE, about how they achieved such results and how to secure investments if you are a young startup.
Read the material and learn more:
Angel One is a fund that has made one of the largest numbers of investments during wartime. How do you manage to do this? Tell us more about your experience.
Yes, we have made 3 investments and just finalized the fourth. The fund has raised real money, not just commitments, and we actively invest in Ukrainian startups.
We actively seek them out, and as soon as we find an interesting team that aligns with our values, vision, and mission, we invest. A strong advisory board and team help us evaluate and understand which projects are of interest to us. That’s why we make decisions fairly quickly in this composition.
We aim to be fast. We invest at the earliest stages, where there are still relatively few metrics. We pay attention to the founders, their experience, their passion, and their vision for business development.
What specific projects and criteria do you support?
We strive to support teams that want to make a significant impact. We’re not just about “business,” but also about products that make people’s lives better.
- GO TO-U is an online platform for electric vehicle charging, enhancing the experience of electric vehicle owners in meeting their needs.
- Zeely is an AI-based online resource for promoting small businesses. They operate in North and South American markets and offer online marketing tools for small businesses.
- ROZMOVA.me is a connection between psychotherapists and patients.
- Mosqitter is a combination of hardware and software to combat air pollution. It’s a device that helps control mosquitoes while preserving the environment.
When it comes to metrics, we are an early-stage investment fund, but we still aim to see initial metrics and early sales. We look at how these sales are growing, how the customer base is expanding, how satisfied customers are with the service, and how likely they are to recommend it. These metrics are what we use to evaluate the product.
Ambition is very important to us. It’s crucial to understand how founders envision their product, what they want it to be in 3, 5, or 10 years, and whether they have this vision. This shows how much they associate themselves with the business and their desire to grow it into a unicorn.
We understand that there will be mistakes, that products will change, but the founders, their vision, their ambition – that’s what won’t change.
What are your goals for the coming months and beyond?
We aim to invest in at least one startup every month. We have funds for 5 investments. Currently, we are actively raising our second fund and plan to complete this fundraising phase by the New Year. Consequently, from that period onwards, we will start investing from the new fund. It will be larger (the current fund amounts to 1.5 million dollars).
Our ambition is to grow the fund to 10 million dollars over the next 2-3 years and make it one of the largest players in the venture industry.
One of the very important projects for us is a fund where we will invest small checks, in the range of 30-50 thousand dollars, in teams at the angel stage. That is, giving them the opportunity to ‘seed’ and ‘grow.’
In your observations, how has the war affected investment in the startup industry, and why is it important to continue developing this sector despite everything?
The war has had a very negative impact. Most startups that had already attracted investments relocated abroad at the request of investors. A significant portion was forced to suspend or completely cease their operations because some startups were, in one way or another, developing their projects in the Ukrainian market. Our market effectively disappeared and ceased to exist, and customers vanished. So, founders were forced to reconsider their approach and look for new markets.
Some managed to do it, while others didn’t. Some were more successful, and some less so. Selling a product in a foreign market is a completely different strategy, culture, and set of methods.
Many who were just starting out or paused their activities due to volunteer work or went to the real sector to earn ‘real’ money for greater financial security.
Now we see that the industry is reviving, with more startups and teams emerging, and more investors actively showing interest and continuing to invest.
During the full-scale invasion, founders quickly realized that success lies in entering global markets right away, not fixating on the Ukrainian market, which is relatively small. They aimed to enter European and American markets immediately.
We will become more competitive, and startups have a chance to become more successful, which will have a positive impact on the entire Ukrainian market. Developing the industry is definitely necessary because it’s about innovation.
Successful startups eventually become businesses, create jobs, and pay taxes. We need to explain more to traditional businesses what innovation is and how startups can help them become more successful.
Note: Angel One, the angel venture fund, was established by the Ukrainian Catholic University Foundation. The decision to support early-stage teams was made towards the end of 2021, at which point they raised funds for their initial capital. The fund will be investing in Ukrainian startups from various sectors, with investment amounts ranging from $50,000 to $200,000 USD. The primary focus areas are FinTech, SaaS, EdTech, AI/ML. However, one-third of the investments will be directed towards EdTech startups and those aiming to have a significant impact on solving global problems.
For more information about Angel One Fund, please visit their website.