Meet Mark Mitchell. He’s an angel investor with Delaware Crossing Investor Group, which operates out of two offices in New Jersey and Pennsylvania. Although he’s only been with the group for a little over a year, he’s already made five investments. Though his background is in fire protection and security, through the group, he’s been able to explore different industries and make a range of investments.
Mitchell enjoys participating in networking events to meet entrepreneurs such as the upcoming Founders and Funders hosted by the NJ EDA because the “match making” is more targeted – and thus more effective – in connecting him to the right startups.
He personally has an interest in apps and the Internet of Things; the latter because of the innovations he is seeing and the new markets that are being opened. His investments have included medical companies, but in the area of healthcare, he relies upon the experts in the field and other angels in Delaware Crossing to make an investment decision.
This is Mitchell’s third visit to Founder and Funders, and since it’s not his first rodeo, he has a keener eye and ear as to what he wants to see in an entrepreneur and what he wants to hear in their pitch. He has access to a deck about the pitching entrepreneurs before the event which came from his stated preferences given to the NJ EDA.
“There’s a lot of pressure on the entrepreneurs, and I appreciate that, so I’m not adversarial,” said Mitchell. “People get the impression that it’s like “Shark Tank” and very hard-nosed, but it’s not like that. Most people have very interesting ideas, and we try to understand if their idea can be converted into a commercially viable product.”
For Mitchell, these “dates” are about gathering information, not a negotiating session. No deals are made in those session, but rather, he’s trying to understand the product and decide if that specific entrepreneur is the type of person who can achieve it.
“Angel investors fall in love with the idea, but invest in the team,” said Mitchell.
That’s to say, these interviews are personal. In addition to a pitch, the meeting is very much like a job interview. It is part of a process, but no decision will be made that day.
“These discussions aren’t just about deciding whether the tech makes sense, but also deciding if this is the right horse to back to deliver on it,” said Mitchell.
He also emphasizes the importance of the initial delivery when the entrepreneur faces him. He says that if in the first two sentences, you haven’t defined the problem you’re solving and explained the product or technology that solves that particular problem, you’ll lose him very quickly.
Two other words of advice: be specific.
“I’ve spoken to entrepreneurs for 4-5 minutes and still don’t know whether they’re selling a product or a service,” said Mitchell. “I get frustrated when people don’t clearly articulate what the product does and what problem it solves. If I don’t perceive it as a real problem, then I don’t need their solution.”
Since Mitchell serves as a representative of Delaware Crossing, he essentially works as a screener for possible presentations to the group. The group is extremely exclusive in their investments – they only invest in 5-8 startups each year – so they have to be very selective about who they choose to move along in the screening process.
“Because we screen so many companies, it’s easy to find a reason to say no, unfortunately,” said Mitchell.
Following a meeting at an event like Founders and Funders, Mitchell usually exchanges business cards and he often receives a follow up email from the entrepreneur the very next day. If the introduction has really gained his interest, Mitchell will be more proactive in engaging with the entrepreneur. From there, Mitchell may chat with the company over the phone a few times. Once he is confident they’d be a good match, the Delaware Crossing group has a committee that extends an invite to come into their office and pitch to the entire team, and begin their process of reviewing the potential investment.
“We only meet once a month and have two companies present, so they’re coveted slots,” said Mitchell.
In testimonial to what the NJ EDA is providing via the Founders and Funders event, Mitchell has direct advice about perfecting their pitch. “I suggest that an entrepreneur pitch to as many and as often as they can to these types of events just to get exposure, as every investor has a different set of requirements. There are a lot of investors out there and an awful lot of money, but there is a lot of competition for that money.”
Ultimately, there’s no hard and fast criteria for Mitchell or Delaware Crossing members to say yes. The members invest in a range of industries, all based on their individual preferences of what each is most interested in.
