Deal Flow Through Experts

A key strategy for getting access to quality startup deals is building relationships with expert investors who have deep domain expertise. Here's the framework for how it works:

Core Strategy for Deal Flow

• 40-50% of quality deals come from relationships with expert investors
• Focus on building relationships with investors who are specialists in specific niches
• Regular deal sharing between trusted partners who each have unique expertise

Key Components of Network

• Individual Expert Relationships

  • Regular coffee meetings every 2-3 weeks
  • Consistent deal sharing and note trading
  • Build relationships with fund partners who have domain expertise

• Geographic/Domain Expertise Networks

  • Build relationships in specific regions (India, Southeast Asia)
  • Focus on areas where you have unique relationships
  • Target experts in specific verticals (e.g. enterprise SaaS)

Example Network Structure

• Craft Ventures (Enterprise SaaS deals)
  • Founded by David Sacks (Built/sold Yammer for $1B)
  • Regular meetings between fund partners
  • Trading notes on deals in the space

Deal Flow Process

• Get inbound deals through reputation/brand
• Cold outreach to companies in target themes
• Quick filtering based on established criteria
• Aggressive pursuit once conviction is established
• Look for companies with:
  • Several million in recurring revenue
  • Clear growth potential
  • Strong founding team
  • Reasonable valuation

Investment Velocity

• Investing ~$2M per quarter
• Increased from initial smaller amount
• Scaled up as deal flow quality improved
• Focus on maintaining high quality bar vs just deploying capital

The key insight is that startups are unique as an asset class because deals select you as much as you select them - making relationships and reputation critical for access.