In The Silicon Tropic

By South Florida entrepreneurs, for South Florida entrepreneurs. All things tech in the sunny Silicon Tropic.

NEW FUND ALERT: Las Olas Venture Capital

Mark Volchek headshot

Who are you? “Mark Volchek. I was born in New York City, lived in Austria as a teen, and then came back to the US to attend Yale. There, I met my co-founders for my startup Called Higher One [which went public in 2010]. I moved to Florida in 2007 and was still commuting back to Connecticut, but Florida became my personal home base.”

Tell us about Las Olas VC. “We got together the last 90 days to form the fund, although we’ve been talking about it for a long time. There are four founding partners with somewhat different backgrounds: Dean [Hatton] and I came from Higher One, Esteban Reyes who we met through Angel investing down in Miami has three successful ventures who exited, and Paul Tanner, a private wealth manager who just started Las Olas Capital Advisors. The idea was to invest back in the ecosystem. We had all been angels, and we thought it would be more beneficial to do something more professional. The target is to have the first closing [of funds] within the next 90 days and go live. The goal is to raise $35 to $40m, (capped at $50m). We are already seeing lots of deal flows for the fund. We’ve already been looking at some deals, but formally, we’re looking to start reviewing possible investments within a month. Once a startup applies for funding, it can take 30-60 days because the entrepreneurs aren’t as organized as they could be. That timeline works well with us right now.”

Tag an entrepreneur or startup to be interviewed:

    1. Modernizing Medicine based in Boca, started by a serial entrepreneur from Blackboard. It is a software tool for necro professionals.”

Describe your ideal investment. “We’re looking for high-growth technology based businesses. These days many businesses qualify as technology enabled. So, sometimes it’s easier to say what we aren’t looking to invest in: real estate, traditional manufacturing or retail stores. But from a spectrum, we’re willing to look at tech that has potential for scalable high growth.”

What stage of startup? Things that most people would call pre-series A but post-angel. We’re looking for rounds between 1 and 5 million so we can write a check between 1 and 2.5 million and  lead the round. We’ll probably do some angel investing with the hope and expectation that the startup will grow, so we can invest in the follow on.”

Terms? “Primarily we would like to do equity. Convertible notes are good for early stage startups. When a startup gets to the stage of raising a few million dollars, it’s time to do equity. A priced equity round that is fair to the entrepreneurs and fair to our investors.”

How many startups do you plan to invest in each year? “With the fund, our expectation is 5-10 startups a year. It depends on how many great deals we see. We have the capacity to do one per month, but then we would have to raise the next round sooner. We’re not only focused on South Florida, we will do West Palm, Orlando, and Tampa. Strategic deals outside of Florida as well, such as those in Latin America as well.”

Do they have to relocate? “No. But, for us to lead a deal, we have to be able to help the company. We are essentially participating. We think being physically close is important because we can better help the Florida ecosystem. The idea is to connect VCs in San Francisco and New York with startups here. If we plan to invest $2 or $2.5m in a $5m raise, we need someone to fill the round.”

How are you different than other investors in the South Florida region? “There is obviously lots of capital here, but I don’t think there is enough early stage institutional venture. We think there is a funding gap between a lot of very early stage money and later stage money.”

Tell me about your connections: “We think we can be really helpful between the four of us. Three of us are operators who have taken startups from nothing to scale. With that background, we can our startups with sales, future fundraising, and recruiting. We believe that those are the three most important aspects. That’s also how we evaluate if it’s a good investment; can we help their sector. We want to partner with our companies.”

Does your team use any productivity apps or tools?We’re using Slack, that works well for us. We’re figuring out how to make it work in our workflow. I’ve learned not to have too many tools. We’re working on a database tool. We need to look at 100 deals to make one investment, so we’re looking at more than 1000+ startups a year.”

What do you think South Florida needs to become the next startup hub?Obviously more organized investors, and I think that’s one of the things holding people back. Not just amount of capital, but folks that steer you in the right direction. Having the proper deal documentation, making your company look professional. South Florida is still learning how to convert their enthusiasm into more of a real startup business environment. There can never be enough venture capitalists.”

What has been your biggest challenge for your fund in South Florida?Interestingly, no challenges yet, but the hardest part is about to start. We’re about to start gathering formal commitments. There are two stages to a successful fund. The first is raising the fund itself, but we’re fortunate that this whole idea was driven by people telling us they want to invest in a fund like us. The second part is finding good investments and good entrepreneurs so we ultimately find a good return.”

How do you plan on finding them?Two areas we focus on. Networking, social media, LinkedIn, having a website. The area that’s more important is the deal flow from strategic partners at incubators and accelerators. People that got early stage money from some organization. So they’ll send them to us when they’re ready to raise the next round.”

Do you personally use the services or product of any Miami-based startups? “One that comes to mind is Terremark which is a very successful data center company. People should know more about them.”

What book are you currently reading/the last book you read:The book I’m currently reading is a bit out of place but it’s called Winner’s Dream: A Journy from Corner Store to Corner Office by Bill McDermott. The key story is the corner store to corner office. How he kept learning to succeed in multiple jobs is fascinating. Not really a business book, but more of an autobiography.”

Must Read for startups?Read as many interesting business books as possible and then build your own style out of what you’ve learned. Certainly, The Lean Startup is popular, but then something else will be popular soon. There’s no one system or one book.”

What is the best advice you can give to someone that is starting a startup?I think really early on the most important thing is to build a great team. Getting the right co-founder and the right employees is everything. If you don’t, there is a very low chance of success. Otherwise, startups really only fail when the people driving them give up.”

Best Happy Hour in Fort Lauderdale:American Social which is right across the street from our makeshift office on Las Olas.”

Best place for a business lunch in Fort Lauderdale:Safe bet for a business lunch is Yolo. It is very consistent with its great service and atmosphere.”

Finish this sentence: I wish a South Florida startup would create an app that ______________. “There’s really already an app for everything already. I already have too many apps. Someone should build an app that requires you to have fewer apps.” [As a total App Hoarder, I second this. Someone, please create an app that automatically deletes apps I haven’t opened in over 6 weeks.]

How can startups apply to be considered?We’ll have a website up in a few more weeks. For now, have folks email me.”

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This entry was posted on January 8, 2016 by in People, The Scene, Uncategorized and tagged , , .
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