SHERAAN AMOD, PERSONERA
For Sheraan Amod, Vinny Lingham was a South African tech success story. “I wasn’t actually looking for an investor. I was looking for advice and contacts, and Vinny was an excellent place to start,” he explains. “His knowledge and networks would have been invaluable.”
Sheraan knew the ball was in his court. He made contact with Vinny on LinkedIn and Facebook, and managed to source his email address. He then sent Vinny three emails outlining who he was and his business idea… and had no response. “So I went to plan B. I learnt that Vinny was in South Africa and that his company Yola was having a party. So I crashed the party.
“I managed to introduce myself to him – and he recognised my name. He had read my email and was actually intrigued by my idea. He gave me one minute to pitch my company and idea. The reasoning for this is simple – you can only distill your business down into an elevator pitch if you really know your value proposition. Always be prepared – investors will see straight through you if you aren’t.”
Vinny liked Sheraan’s idea. He was invited to the office the next day, where a half hour meeting soon stretched to an hour.
“He even asked me if I was looking for capital – which of course I was. A day later he and two other like-minded investors were sold. I had investors, a mentor and a business that I was ready to build. Personera, a unique personalised merchandise platform on Facebook, has grown dramatically in the international market over the last year.”
Based on his experiences, Sheraan has these points to offer fellow entrepreneurs:
- Potential investors are busy. They like to see perseverance, so you need to be the pursuer. It shows how serious you are, but it also keeps you on their radar. If there is no match and they ask you to stop, respect their wishes.
- Money is important, but a bad investor can kill your business. Do your research and make sure the fit is right before you approach anyone.
- Be flexible. My original business idea makes up about 20% of what the business actually developed into. Respect your investor’s opinions and ideas.
- Once you have a well-connected investor on board, things can happen quickly. Personera has venture capital funds Hasso Plattner Ventures Africa as well as 4Di Capital on board — and both firms were first introduced to me by Vinny. Be ready for things to change quickly. Be flexible and adaptable.
- Leverage networks. Ask for advice, opinions and introductions. The more contacts you have, the bigger your pool of influence.
Yola.com founder Vinny Lingham is a South African entrepreneur who now lives and operates in Silicon Valley. He is also an angel investor. Why? Because he wants to support young entrepreneurs who are like he was: young, bright, willing to learn, and willing to make mistakes.
“I believe that most entrepreneurs are interested in supporting other young entrepreneurs break through,” he says. “This could be as an advisor or mentor, through contacts or even financially. The trick for aspiring entrepreneurs is to find and reach out to the right entrepreneurs who want to give back.”
In the case of Sheraan Amod, Vinny took this pitch to a few of his like-minded friends, and within days he had raised R1 million for Sheraan’s start-up.
Ticking the Right Boxes
Why? Because Sheraan ticked all the boxes that Vinny was looking for. Here’s what they were:
- I am interested in the tech space, specifically disruptive businesses that will change the market. If you want to approach an angel investor, make sure their goals align with yours and what you are offering. If you keep knocking on the wrong doors, you won’t be taken seriously.
- Read magazines, blogs and websites that relate to your field and the business world as a whole. Know who the entrepreneurial players are and where their interests lie. Do your research and attend events. Make connections.
- You need to have a good idea. Be practical, know your industry, and be able to demonstrate this knowledge. You won’t be expected to be a master, but you need to demonstrate that you have really thought your business plan through.
- Understand the angel landscape. In South Africa angel investors are not often bought out by VCs. Instead they need to be patient while the business grows. Understand what the angel investor is looking for. This will be a partnership, and it’s important you are all on the same page.
- Be willing to learn from your mistakes and pick yourself up again when you make them. Your angel investor will support you, but you must be honest and upfront about what is happening in the business.