Demystifying Family Office Funds:-
Family Office Funds are where the entire wealth of the Corporate Family is. Adani/ Ambani need large deals hence of no use to you. What you need to understand:-
1. They invest 5% of total assets in Startups. However e.g. Premji Invest invests minimum USD 25M typically $100M, hence don't pursue them. Adani's invest for 55%-100%. Reliance 25%+ Equity. Hence u need to be big to map these FOs
2. Better FOs are like e.g. Ratan Tata invested in PSI Startup Mailit (Read my previous post on this).
3. Other Good family offices are Dabur, Hero Motors, Sharpp (VC Fund of Marico)
4. However the real family office for you to map are the ones smaller than these. E.g. a Pharma Co or Auto Ancilliary Co with net worth of INR 5000 Cr. will be able to invest 1-2-8 Cr / $1M in Startup. Many of them have VC funds hence identify the Fund and the Fund Partner.
Source: Economic Times
Why Family Office is better than VC:-
1. No exit pressure, no massive targets, no pressure to burn. They are OK with 10 year exit
2. They come in early at Pre Series, Seed stage
3. Can provide you Revenue Growth, e.g. When Marico acquired Beardo, or even made minor investment, their massive Distribution network helps the Startup
4. Can acquire you 100% and make you a rich millionaire. which is great, u can use the money to build your next startup
5. More accessible, respond faster on Linkedin compared to VC
6. Most family offices have one Person managing Startup Investments for the Family Office, hence you need to only convince this single person. VCs have Investment Committee. Also most family offices are SFO - Single Family Offices (read the article)
7. On related note, seek Angels who are genuine Angels who have done 2-3 investments as per their Linkedin profile. Avoid crowdfunding, build your relations directly with Angels via Linkedin. Avoid those who have Angel in their Linkedin headline just for the sake of it!! :)
Top reasons for Family Offices to invest in startups
Source: Economic Times
Angel Investing Simplified!
Happy Fundraising! All the Best!
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