Maintainer: Akim Arhipov
Last reviewed: 21.02.2023
Commitments updates: 20.01: 100k from Mikita Mikado (founder of PandaDoc, $1B+ eSign company) and leading the round from angels side. 30.01: +120k committed from fff.vc members 06.02: +30k committed from fff.vc members 17.02: second round discussions with 500 Global, Inventure, Tera VC, Superangel. 21.02: +25k committed from fff.vc members
30.01 - 10.02 - Read deck & FAQ; The data room open for business DD and Akim Arhipov, fff.vc CEO & Co-founder, is available for calls. Feel free to send additional information requests if you find anything missing here. 13.02 - Confirmation of contents We would expect to receive confirmation from the investor that the data room checks out, and that there is a high likelihood of interest in presenting a terms sheet after getting access to the team for additional interviews. 14.02 - 24.02 - Calls We are open to organizing calls and meetings between the investors and other management team members in fff.vc 01.03 - Term Sheet As a result of the process above, we would expect the investor to present the term sheet. 5.03 - 15.03 - Confirmatory DD 15.03 - Expected closing of the round and transfer of funds
Ask: 1M€ (300k angels + 700k VCs) Valuation: 6M€ (TBD) Investment instrument: Equity Cap table: 90% founders + 10% option pool
200+ members and 35% are scouts. I'm happy to connect you with anyone on the list. 0€ performance marketing outbound, content, podcast ~8 referrals from existing members per week (early sign of network effect) 72% opening rate for digests and investment memos 4M€ invested in Estonia and Sweden 144,395€ in revenue from fees Top-2 investment podcast in Baltics & Nordics
We build a data and community platform where people can dig into private market research and investment ideas. Unlike public markets, private markets lack transparency and trust. Most data is behind paywalls or subjective. In addition, CAC is high for investment advisors & alternative investment platforms. There is a change in what people read (people trust people) and how they invest (from speculative trading to long-term sustainable investing), so it's the perfect timing. We aggregate market data & signals and turn them into verified engaging content. Members get it on our Reddit-like platform and e-mail digests. How it works? • We collect and process social signals, public reports, blogs & podcasts and quant data; • Members and independent writers get data sets with related topics and write articles, reports or summaries. Our experts contribute their expertise while we provide verified and up-to-date data sets; • All members read the latest insights and reports created by independent authors; • Members consider curated and vetted investment ideas by in-house team; • We work with our partners (originators) to make sure members get full support during the investment process. In last 8 months, we validated and killed 3 product hypotheses: SPV platform ❌ Secondaries marketplace ❌ Digital non-rev trusts ❌ What we learned? Check Market & learnings below.
We proved the need with angel investors and tech executives. Usually they invest 5k EUR per deal. They are members of 1-3 clubs / communities and mostly consume media, newsletters and less socials. In average, they spend 1000 EUR / yearly in private banking fees and 1500 EUR / yearly in memberships & subscriptions. We will continue to work with them and will test new groups: Angel investors (109k people based on LinkedIn) Investors (838k) Founders (7.8M) Entrepreneurs and Business Owners (30-45 y.o.) (25M+) Executives & C-level managers (22M+) Investment managers (1.2M) Investment analyst (930k)
Content: Content strategy is based on user interest, macro and business goals. Research & analysis on industries, economic forecasts, trends, and signals is what our target audience wants. We aggregate raw data from public & private market reports, social networks, blogs & newsletters, podcasts, and quantitative data. The first product version collects, categorizes, and produces content with machine learning and in-house editors. We sign up independent authors to scale the content. For example, SeekingAlpha hosts 17,000 authors who get paid fixed fee ($45/article) and variable fee (CPM). There are more than 30,000 authors on Substack in investment, finance, startups, and related fields. Our data platform will give authors access to data sets around private markets. We help authors make money from their expertise by providing data sets with related topics. This strategy boost our SEO and make our network effect stronger, which will lower acquisition costs and increase retention. Investment ideas: As fff.vc canvases and curates alternative investment market opportunities, the investments that ultimately pass through the multi-step process must be able to withstand our vetting process to ensure a resilient investment structure that seeks to minimize surprise downside outcomes. How the process look like: 1. Sourcing. Fund managers, investment platforms, brokers, and other ecosystem players help us source investment ideas. 2. Screening & Diligence; 3. Internal committee review; 4. Publish & members review; 5. Collect users interest; 6. Coordinate the closing with originators. Tools: Once we get more data, we'll start thinking about tools.
According to a McKinsey & Company study, total assets under management in the global PE industry hit a whopping US$9.8 trillion in June 2021. Blackrock predicts that this amount will double by 2027 (~US$18 trillion). In the current lower-for-even-longer interest-rate environment, investors’ appetite for alternative investments is as high as ever, with the young leading the way: about 35 percent of 25-to-44-year-old investors indicate an increased demand for alternatives. Increased client demand and innovations have potential to increase the share of assets allocated to private markets from about 2 percent in 2020 to 3 to 5 percent by 2025, representing asset growth of between $500 billion and $1.3 trillion. The fastest-growing segment of affluent investors is hybrid - those with self-directed accounts plus a traditional advisor. Result of two trends that are expected to persist: investors’ desire for human advice and the ease and affordability of direct investing. Private Equity has higher returns and lower volatility than Public Markets over the past two decades. SEC data. Bringing more investors on board will require matching the advisor-like experience with personalized content and solutions. Digital advice offering require going beyond the lower-cost value proposition, privileged acquisition strategies, and brand equity. Among investors who do not express comfort with robo-advisor models, the main reasons they give are perceived lack of personalization, privacy concerns, and lack of motivation to explore the offering. What is proven: a) It's proven by the FT, Economist, SeekingAlpha, Substack authors that readers pay $5-100 monthly for content (not often unique). b) PitchBook proved that investors pay $20k / year for insights & market research. c) BANs proved that investors pay $200-1000/year for investment ideas and community. d) Angellist and VCs proved that investors pay 2-5% fee and 20% carry for syndication. e) A wealth management advisory firm's entry threshold for customers is $100,000 with a 2% fee on assets under management. f) Investment platforms and brokers are ready to pay fixed 2-5% fee from the deal size or/and qualified lead fee. g) The price of creating SPV on platforms tends to zero because of the high competition between Vauban, Odin, Funderbeam, Allocation and Angellist. h) Kitces reckon customer acquisition cost in wealth management is around $3,119 per client. Robo-advisors have ‘just’ an average acquisition cost of $500 - $1,000. i) Study aggregate CAC channels across 800 financial advisors and channels efficiency.
Media: Media - Bloomberg, Financial Times, Business Insider, CNBC - over 300M visitors monthly Platforms - CBInsights, Crunchbase, SeekingAlpha, Fool.com - 60M visitors monthly Socials: Reddit - invest, finance and personal finance sub-threads - over 30M+ subscribers Twitter & LinkedIn - invest, finance and personal finance topics - 50M+ subscribers Substack - invest, finance and personal finance newsletters - over 500k paid subscribers Startups: They all focus on investment, not content and community. That's what sets us apart in the beginning. Yieldstreet - alternative investments platform in US - founded in 2016 - Private - Series C - focus on investments, not content - marine, real estate art and private credit iCapital Network - fintech platform for alternative investments and investors - 2013 - Private - Series D - focus on infrastructure for wealth managers Fundrise - alternative investments platform in US - 2011 - Private - Series A - focus on investment - real estate Moonfare - provides access to top-tier private markets investment opportunities in EU - 2018 - Private - Series D - focus on investment - VC & Private Equity funds
Business model: For now, we're using freemium and deal entry fees. Member's behavior determines which model we choose. We'll keep experimenting until we reach critical mass so we can make the right decision. Model 1: Subscription Freemium: selected content | 0€ Premium: access to premium content, community, digests, tools and investment ideas | 50-100€/month Other fees: affiliate fees and deal entry fee (5% from the deal size) Model 2: Pay-per-use Freemium: selected content | 0€ Pay-per-use: pay to open premium content, weekly digest, tools and investment ideas | 10€ / each Other fees: affiliate fees and deal entry fee (5% from the deal size) Financial model: Happy to show on the call. Customer Acquisition: Our sales rep onboards max 40 members a month using cold outbound messages on Linkedin. People started referring other investors. Every week, we get at least 8 referrals.
We took best practice from SeekingAlpha and will adopt to our business logic. 1. Fixed payment of $45 for an article. 2. Variable payment is calculated based on how many Premium subscribers read authors’ article. We set an overall budget each month and divide it into an allocated budget for each subscriber. Each subscriber’s “budget” is then distributed to authors proportionally based on how many articles that subscriber read during the month. The more articles are read by Premium subscribers, the more money author will earn. We will start from up to 20 authors with a strong presence on Substack and will grow as soon as we onboard new members to Premium. Our vetting process is simple: 1. A potential author submits an article for review. 2. Our editorial team reviews the article to determine whether it's appropriate for our audience. We score submissions (internally) on three characteristics: a) Convincing: What's the author's thesis? Does he do a good job of convincing the reader? b) Actionable: Is the article material to investors in an obvious way? c) Well-presented: readers want content that is clear, focused, and easily understandable. 3. If the article is publishable, we confirm that we have the contributor's real name, address, contact information, and banking information. 4. Once a contributor's article is published, we watch article comments and disputes for any warning signs that we may have gotten #2 wrong. We're not perfect. If at any time we feel a contributor's analysis no longer meets our standard, we decommission him.
Data platform = [Data scraping → Data Categorization → ML → Knowledge base → UIs for authors] close reference: EQT Motherbrain Scraping & learning: node.js, mongoDB, API data layer, Open AI Davinci Dashboards: nuxt 3 + vue 3 + stylus, graphql + express Community interface = [Forum → Threads → Read & Learn → Receive digests → Make investment decision] close reference: Reddit We use low-code platforms such as PeerBoard & Bubble. Integrations with Zapier. We have control over identity, analytics, and content layers, so we can migrate at any time.
Data - use restrictions may apply - we will overcome with alternative sources From the start, we are simply referring users to the original, 3rd party source of the content by simply sharing the idea (preview) to our users of what might be found should user proceed to read news piece in depth on the original source. We are making all the needed references and even display the original source of the news piece. As long as the model applied is being Freemium, we bare rather low risk as long as we are not claiming 3rd party content being ours not do we serve it as ours. In case we start implementing subscription for access, we are in a more difficult position. We will have to be getting in direct contact with 3rd party sources and negotiating the agreement to use some of their content on our platform. We are still planning always to refer users to the original source of content. Exception will be in-house content. We are in the communication of our legal team and are flexible to apply the needed changes that could come along. Legal - we might have to acquire investment advisory license
Akim - CEO & head of origination - full-time Tim - COO & head of content - full-time Deniss - community manager - salary - full-time Anton - marketing manager - salary - full-time Nick - product manager (ex-Yandex & Avito) - sweat equity - full-time Rodion - head of data platform (ex-3Commas) - sweat equity - full-time Kristjan - head of growth (ex-EstateGuru) - sweat equity - full-time Valter - legal (Triniti) - contractor Polina - finance & accounting (ex-WebShield) - contractor We recruit Head of Content and Data Engineers from Sequoia & EQT Motherbrain.
2023 target One-stop-shop for private market investors • Comprehensive data platform with UIs for members and authors • 100 authors • 1000 paying customers • 300,000€ ARR Narrative for the next funding rounds: a) Boost content creation and membership growth. Add new features and tools for investors with a help of our data platform. b) Build tools for wealth managers and investment advisors. Add B2B revenue channel. 5 years vision Products for wealth managers and investment advisors • Significant market power to get best deals • Asset class comparison tools • Tools for asset managers to boost productivity and earnings per customer
*Roll out for all fff.vc member *Add another 30 integrated data sources *Increase content quality: reading time and depth *Unlock organic CA channels *Build and test user retention funnels *Properly test sales funnel for Premium
Questions from VCs
Q1/2 goals: increase the quality of content, unlock organic CA channels, and test business models (pay-per-use or subscription). We don't have the challenges of getting unique investment opportunities. 1. Content part a) track and analyze the app/digest opening rates, styling & formats, and reading depth; b) add, change, and/or reprioritize the pre-picked data sources; c) experiment with other generative AI models to get the most accurate and copyright-free summaries (data sets) for authors; d) come up with a convenient UI for data sets delivery. 2. CA part a) Launch a referral program; b) LinkedIn automation; c) Conversion rate optimization. 3. Business models a) Run price elasticity interviews with active cohort; b) A/B test the models.
Acquire members country by country with local investment offerings. Recruit representative and ambassadors. We will use the same playbook as in Estonia and Sweden: Brand visibility: Form partnerships with local ecosystem players, such as VCs, BANs, wealth managers, investment advisors and private banks. Co-host events & dinners and PR. Customer acquisition: 1. Automated LinkedIn cold outreach → Sign up → Onboarding call → Newsletters; 2. Affiliate program with Substack & Medium authors (guest posts); 3. Content marketing; 4. Referral program with members.
We design global service with global outbound outreach through LinkedIn and Twitter (20M+ people as target audience on those platforms:
- Angel investors (109k people based on LinkedIn)
- Investors (838k)
- Founders (7.8M)
- Entrepreneurs and Business Owners (30-45 y.o.) (25M+)
- Executives & C-level managers (22M+)
- Investment managers (1.2M)
- Investment analyst (930k)
We start from 2 categories: 1. Invest in primary & secondary tech deals; 2. Become LP in VC, real-estate and loan originators funds. Where do we get them? 1. We establish the partnerships with founders and fund managers in selected region; 2. Members bring their own deals.
Scenario #1: Community app -> Custom newsletter with content and deals We build community app to avoid personal biases and collect data to understand what and how people consume content.
With this data, we'll offer custom newsletters based on each person's preferences.
Scenario #2: Substack for private markets Make it easy for authors to create content with our data platform and help to build up their audience. Scenario #3: tools for wealth managers, investment advisors and family office managers Make it easy to aggregate up-to-date information and investment ideas in private markets to their clients. Scenario #4: ChatGPT / AI for private markets On top of our data platform, build flexible UI to: 1. Get latest news and funding summaries; 2. Generate reports about trends and industries; 3. Compare investment instruments between each other; 4. Compare public and private companies; For investors, investment advisors, wealth and family office managers. It will allow them to process more clients, add personal touch, increase efficiency and earnings per customer.
Two motivations: 1. Learn together with smart people → data and content parts; 2. Diversify portfolio → investment part. We asked members and they gave us the following replies: 1. They want to save time by reading only the most important and pre-moderated content; 2. They want to belong to community and have quick access to smart people; 3. Invest in unique deals where they can not invest on their own; Our members paid us 140k+ to join 7 syndicates in 2022.
We recruit Head of Content and Data Engineers. Head of Content: We found couple strong candidates locally. They consult us and ready to join full-time once the round is closed. In addition, we approached people from the following companies: EQT Bloomberg CBInsights Pitchbook Data Engineers: We have commitments from candidates who built Yandex Search. Our members advise us on the data platform: Indrek Vainu - conversational AI & machine learning expert; Erik Kaju - CPTO in Inbank and ex-Wise Priit Potter - building data platform in Splunk; Anton Ask Åström - EQT Motherbrain lead
Please book a call and we will do live demo.