Finding next at the University of Toronto

I’m guilty. I’ve been pandering to my alma mater, the University of Waterloo. I love Waterloo and UWaterloo startups. There is so much to love. There are Vidyard, Thalmic Labs, TribeHR, Desire2Learn, PostRank (acquired by Google), . There is even a Waterloo mafia in Toronto with Upverter, Top Hat Monocle, SocialDeck (acquired by Google), PushLife (acquired by Google), Xtreme Labs (Amar, Sunny, Farhan are all UWaterloo 1998 grads along with Social+Capital‘s Chamath) and others.

But have you seen the awesomesauce that is originating at the University of Toronto:

Bumptop acquired by Google, founded by UofT CS Masters student Anand Agarawala
Sysomos acquired by Marketwire, founded by UofT CS prof Nick Koudas and Nilesh Bansal (UofT CS PhD candidate)
BackType acquired by Twitter, founded by Christopher Golda and Michael Montano, both UofT Electrical Engineering Grads
CognoVision acquired by Intel, founded by Shahzad Malik (UofT CS PhD)
ScribbleLive cofounder Jonathan Keebler is a UofT CS grad
Rypple acquired by Salesforce, founded by Daniel Debow (JD/MBA UofT) and George Babu (Engineering, MBA and JD)
Canopy Labs founded by Wojciech Gryc a UofT grad
Wattpad founded by Allen Lau (UofT Engineering) and Ivan Yuen (UofT MBA + UWaterloo Engineering)
DNNresearch Inc. acquired by Google was founded by UofT prof Geoffrey Hinton and 2 graduate students

There are a number of spots on the UofT campus to find high potential growth startups and engineers. You can look at Creative Destruction Lab in the Rotman School of Business. You can look to the Entrepreneurship Hatchery in the Faculty of Applied Science & Engineering.

You can also attend the Computer Science Department’s Research In Action Showcase on April 17, 2013.

Add your events to our calendar.

Should you pay to pitch an angel group? What the data says

We have seen a pretty amazing wealth of information about financing models and structures come to light in the last 10 years. It wasn’t that long ago that VC and Angel financing were dark arts which few entrepreneurs understood. We have always worked hard to demystify startup financing on StartupNorth and have done a long series of articles which was focused on shedding light on angel investing as an option for entrepreneurs which began in 2006.

But the question we hear a lot is “Should I have to pay an angel group to pitch them?”

I’ll keep it simple: Generally the answer is No. By definition angel groups are made up of wealthy individuals who are happy to foot the bill to organize the group.

For example a group might have 100 members all paying $1000 a year. That would mean that the angels themselves are fronting $100,000, which is generally enough to hire a part time (or even fulltime) director or organizer as well as to host the necessary meetings (sometimes members will donate space for the meetings as well or offer other services in-kind).

But if you do have to pay, how much should you expect to pay?

The Angel Capital Association provides direct guidance on this here.

31 out of 81 angel groups surveyed charge fees.
Of the groups that charge, the range of fees is $175 – $750
with two outliers at $1,500 and $3,000, average = $580
average without outliers = $338

We have surveyed all Canadian groups and with the exception of one of the outliers mentioned by the Angel Capital Association above, fees in Canada are at similar levels but are charged less often (closer to 25% of the time).

We have only found two groups in North America which currently also charge a percentage fee (Both in Atlantic Canada, one charging 8% and the other charging approx a 1/2 percent to 2 percent) of the transaction, so generally speaking you will never have to give another fee or piece of the transaction over to the group. We have not completed our research on this and if we uncover any more we will share that data here.

Our advice? Tell the angel group that you prefer to forego the fee completely. If they believe you have a great deal then a shrewd angel group will still want to get an opportunity to fund you. If they say “no way”? Then you have to decide just how serious you think THEY are.

On Values

A friend of mine, who just finished his time after helping grow a startup very quickly, said this to me tonight:

A company has 3 sets of values: the ones they want people to think (what a corporation engraves in their lobby), what management believes is important (policies and stated benefits), and finally the values demonstrated by the people who succeed. The first is bullshit, the second is throwing money at the symptoms, and the last one is the only thing that matters.

It’s a great observation (along the lines of the Netflix culture deck) but it is also a challenge.

As founders, employees and even investors our values translate in to very real things for our employees and customers.

Which values do you live?