Curious to learn more about where things are at, and if AMP is serious about funding local startups, we connected with partner Daren Marhula to hear it from the source:
1) How would you say things are going so far relative to what was anticipated?
Overall, our business at AMP is in-line with our original expectations since launch. That being said, we continue to be surprised by the unrealistically high valuation expectations by many entrepreneurs out there, which has prevented us from making more investments.
2) How would you rate both the quantity and quality of dealflow?
Since the article initially ran, we have talked with roughly 30 companies. As one would expect with early stage companies, the quality has been all over the board. From those discussions our two main takeaways are that (1) valuation expectations are too high, and (2) there is too much focus on being ‘buzzword compliant’ (see below).
3) Has AMP made any tech investments? If so – what? If not – why?
Our first investment was in HomeVisor, which is an online Realtor referral service. We recently funded BuyWafers.com, which is an online retailer of silicon wafers and other electronic materials used in semiconductors. BuyWafers.com will be launching in the next couple of weeks.
4) What advice would you have to future entrepreneurs pitching AMP?
There will always be a divide in valuation – investors want the valuation to be lower, and entrepreneurs want it to be higher. However, having an idea is not worth a million dollars (or more).
Especially true when you want to use investor money to pay yourself while you build it out/prove concept. Starting a company involves sweat equity from the founders, and if the founders are not willing to contribute sweat equity for their ownership, then we are not interested. If you throw out a high number simply to see what you can get, our answer will be a quick ‘no’ and we will move on. If you approach us with a realistic valuation, we are much more likely to be engaged.
Stop reading TechCrunch and focus on building your business; get your valuation expectations in check and when you come in to pitch your idea, we don’t want to hear about exits, pivots, and MVPs…we want to see results. You don’t get funded because you can use all the buzzwords, you get funded because you have a great opportunity and run with passion. If you have that, let’s talk.