Today at the Toronto Software Developers Lunch there was some conversation about how hard it is to raise money for technology ventures in Toronto. I was surprised that this was considered to be the hard problem, as I’ve always felt like there’s always money nearby in Toronto if you’re talking about good ideas and have a great team.
Of course, I’m pretty outspoken about my belief that most ideas are terrible. We live in a world where someone who has no business founding a tech start-up can get investment, hire a team (who presumably need jobs) and launch to market all without talking to a single person that is neutral enough to tell you to stop while you’re ahead. I’ve personally told potential clients that they should take the money they were about to burn on a concept that would never work and invest it in an amazing vacation with their family.
So yeah, sometimes you should just stop. It can be hard, because it seems like many developers are compelled to build the same things over and over again.
But let’s say that you’re really on to something and you’re thinking about raising capital in Toronto. Sure, there’s MARS — they offer venture advice and host angel forums. There’s also StartupNorth and their occasional Founders and Funders dinners. We live in an incredibly networked city with events just about every night. Plus when you factor in SR&ED and other grants, it seems like Toronto is the best place on earth to build a start-up. After all, we get to build our products in relative secrecy if we desire it — something that would be impractical in San Francisco.
So without further ado, this is my list of resources concerning VC and angel investment. I’m not a huge fan of VC politics, so my advice will tend to skew towards angel backing.
If I launched a start-up — if you click on one link, make it this one.
Brad Feld’s Term Sheet Archives is a really deep library of raw information. Required reading before you uncap that fancy pen.
Series Seed documents are free-as-in-beer term sheets that many angels are now agreeing to use. This article discusses how they are different from from typical Series A financing documents.
All about F-shares. No, this is not a wife swap but instead an interesting class of shares separate from common stock that entrepreneurs can receive when founding a company. Many investors seem to dislike F-shares, but perhaps they need to open their minds, loosen up and pop another quaalude.
What is the right amount of money to raise at a start-up? Let me know if you figure that one out.
What’s the difference between an angel investor and a venture capitalist? This does a pretty great job of answering that question.
Angels are just people, and it pays to be able to approach them with a cause they can believe in. This is often what differentiates angel mentality from that of a venture capitalist. Did you know they used to be called adventure capitalists? This article talks about the psychology of an angel investor.
Venture Hacks has become a very good source of news and information for folks raising capital. However, what I really find exciting is their relatively new Angel List. The deal is that if you submit your pitch and they think it’s good, they will send it out to a huge list of highly influential angels — all of the big names including Ron Conway and Chris Dixon.
Of course, sometimes you really do want to go after VC money and it pays to know who the players are in Canada’s VC industry.
Finally, there are dozens of excellent interviews with founders, investors and dreamers on Mixergy which are chalk full of great information.
What am I missing? Comment and I will continue to update this.
And just before I hit post, I just want to say something real: man, do I ever hate raising money. It fucking sucks. I’m all for making money and building big dreams — some of us have chosen life paths that pretty much demand it. Sure, there are elements of all this that one could argue are relatively interesting… but I hate to think of how much human creative potential has been squashed by the necessity of knowing all of this crap to get anything substantial off the ground.