As rightly said, launching a venture is about having a vision,
turning that idea into reality, and then pursuing that dream. While the concept
is simple and can be condensed in a line, the startup journey is long and there
are many lessons to be learned along the way. Here are a few I encountered at
NIN Ventures (or NIN.VC):
01. Remove your emotions
While it is hard to pursue a dream when you don’t have emotions
attached to it. Stop thinking about your start up emotionally. Why? The startup
world moves fast and requires you to fail faster and pivot into a better
direction. Your emotions crowd your judgment when you get too attached to your
dreams. Let loose and let the market guide you towards success.
02. Sign better contracts
We have all heard of spit handshakes or stories of how a business
plan was drafted on a paper napkin during a coffee conversation. While it might
have worked in the past, beware and draft a legal agreement for all your
partnerships.
03. Premature scaling
Every startup dreams of becoming a Unicorn but, I have
experienced, achieving too much success in the beginning may become a hindrance
for future growth.
04. Design a culture of winning
It is important to win in life, but build a culture of winning
where you appreciate a team winning over individual wins. Make it your mantra
to “always give advice in the best interest of the team over yourself”.
05. Consider how much you will need to educate the target market
about your product before starting your business
It is not easy to take your idea to market even when there is a
need for disruption in the industry. Make sure you are educating people about
the problem you are solving and the time you will need before you take your
product to market.
06. Don’t underestimate the power of marketing
Just don’t.
07. Build you technology in-house
Outsourcing is an attractive cost saving option when you are
building the framework for your technology, but it will cost you more time and
money in the long run. Instead opt for a partner or hire someone full time that
can better understand or has expertise in the area.
08. Running out of money is game over
Don’t die.
09. The blame game
Some businesses fail because they could not find a product market
fit, while others made poor strategic decisions that ultimately led to their
demise. Regardless, confront brutal facts and don’t burn bridges with your
partners, customers, or anyone you might have encountered during your journey.
If they were not the answer, they were a lesson or part of the lesson.
10. Pick your mentors wisely
Who you look up to in life determines where you end up. Find
people that genuinely want you to succeed in life and care for your
venture.
Having said all of this - “Will I spend my last dollar and all my
hours to have this opportunity again?”. Yes - IT'S WORTH IT! Why? Life is not
about what you want - it's about what you deserve. And if you don’t like what
you deserve, keep your head down and work harder!!!
PS: This blog is still Work In Progress. I will update it as and when I have more to say. Thank you for reading!
We have all heard of the magic mantra, “Failure is the stepping stone to success”. Such is the story of the Crowdfunding industry and NIN Ventures (or NIN.VC).
Crowdfunding is a practice of funding a project or venture by raising contributions from a large number of people, typically via the Internet. The 2008 Financial meltdown led to a liquidity crises for entrepreneurs, companies, LPs and VCs. Fewer IPOs in the market means no exit for VCs, no returns for LPs, and as a result venture funds were on a decline. No new funds means less startup funding, higher unemployment, and slower economic growth. Thus, on April 5, 2012, the Jumpstart Our Business Startup Act (the JOBS Act) was introduced, enabling crowdfunding for “accredited” Americans.
There are various types of Crowdfunding options; like donation, reward, lending, equity, royalty, and even hybrid versions. However, the two most popular types of Crowdfunding methods are Reward and Equity. For Reward based Crowdfunding, entrepreneurs pre-sell a product or service to launch a business, and some times even in return for gifts or thank you notes. For Equity Crowdfunding, the backer receives share of a company, usually in exchange of the money pledged. For NIN Ventures, it would be a limited partner interest in the NIN Ventures Technology (QP) Fund. This offering was made available online (www.nin.vc) via general solicitation and general advertising, which is permitted by Rule 506(c) as contemplated by Title II of the JOBS Act.
Since its beginning, Venture Capital has been the domain of wealthy individuals and families. A typical LP base in a venture fund would be institutions, pension funds, endowments, family offices, etc. We are all indirectly invested in Venture Funds, but Crowdfunding is an attempt to bring Venture Capital directly to the retail investor by eliminating the middleman. If all other businesses that follow this route have succeeded, why and where did Crowdfunding fail?
Since 2014, the Crowdfunding industry had grown from $16 billion to $34 billion (with roughly $8 billion in Reward and Equity) in 2015; and was doubling or more every year, and according to the World Bank estimates, Crowdfunding was predicted to have a global market of $96 billion by 2025 – 1.8 times the global Venture Capital industry. However, recent studies showed that while the Crowdfunding industry has managed to grow, the Venture industry has outgrown the Crowdfunding industry. As of 2022, the Crowdfunding industry was estimated to be $125 billion (with $19.79 billion in Reward and Equity) vs. $234 billion for the Venture industry.
Here are a few reasons why I think Crowdfunding and / or NIN Ventures failed:
01. Awareness
Any new industry needs to be promoted and positive marketing generally adds fuel to that fire in order to gather public interest. The Government was quick to make changes in order to save the Economy but did not follow through when it came to properly marketing the concept. The Crowdfunding Companies fell short when they tried self-promotion. We are all aware of Environment or Unemployment issues but how many people have actually heard about the JOBS Act?
02. Education
Venture Capital provides financing to early stage emerging companies with high growth potential in exchange for equity / an ownership stake. The risks VCs take investing in disruptive technologies or business models yield higher returns to their limited partners (or investors). Since the beginning of the 20th century, venture capital has been the domain of wealthy individuals, families, and institutional investors. While many of us are indirectly invested in venture funds via our pension funds, etc., most people have knowledge or a portfolio that is limited to stocks, bonds, mutual funds, money market instruments among others. While there are multiple resources available on how to make a good judgment when making a venture capital investment, it is likely that 99% of the times the individual might be proven wrong. Blind pools of money or venture funds are not encouraged by the SEC as they are prone to fraud, when it comes to Crowdfunding. Many are also not aware of redemption and other liquidity issues including lack of interest in the secondary market.
03. Media Interest
This lack of knowledge is further fueled by limited interest in the Media for Crowdfunding portals and companies. Speaking from personal experience, general solicitation and general marketing for Venture Funds had never been attempted before NIN.VC, so the questions and awareness that a journalist had were limited to his / her past experience rather than focusing on Crowdfunding as a business or industry.
04. Governance
Entrepreneurs are brave and courageous bunch that are determined to change the way an existing industry functions. On that journey, they need a lot more than just financing. They need guidance or domain expertise, help with PR/marketing, recruiting, viable exit strategy, more often follow up financing, etc., which Crowdfunding portals are not able to support given they don’t get a say or board seat for their investments.
05. Trust
Given the majority of Crowdfunding companies or start ups don’t make it, most people are now focused on failures and a few highlighted fraud cases glorified by the media, which raises trust issues in an already heighted risky environment.
The SEC has now approved Title III JOBS Act, Equity Crowdfunding for non-accredited investors, which allows any U.S. citizen, regardless of income, to make direct investments via a Crowdfunding portal. However, investment in venture funds is still limited to accredited investors. Given funds are a less riskier asset class compared to Crowdfunding in companies, perhaps it’s time to revisit their investor eligibility, alter the definition of an accredited investor, and make Crowdfunding available for everyone. Until then, are American people given the wrong kind of freedom when it comes to their investment decisions? What is your freedom of choice worth here?
PS: Given the current circumstances, we would like to inform everyone that we have closed doors on our beloved NIN Ventures (or NIN.VC). However, we will be sure to follow up this article with the lessons learned during our journey and what is next in store for us? Thank you for your time and continued interest!
Venture Capital until now was the domain of the super wealthy and institutions, but NIN Ventures (or NIN.VC) is a unique and first of its kind crowdfunded technology venture capital fund for accredited investors who can invest in the NIN Ventures Technology (QP) Fund with a minimum amount of $100,000 using multiple investment options like self-directed IRAs, Defined benefit plan, or a regular checking / savings account. NIN.VC invests in Series & B rounds of disruptive technology companies.
1. What are the few main criteria to consider when investing in a venture capital fund?
The top three criteria any investor should look for in a venture fund is team, experience, and honesty / transparency. As far as returns are concerned, Technology focused funds generally tend to outperform USVC (United States Venture Capital) Index. Historically, USVC Index tends to outperform both USPE (United States Private Equity) Index and S&P 500. Also, unlike popular belief generally First time funds tend to outperform Non-First-Time funds and All Venture Capital funds.
2. Can you explain in detail how does venture capital returns compare to other asset classes?
Most people are familiar and have a three dimensional portfolio (i.e. stocks, bonds, and mutual funds), but if you look at Harvard and Yale’s portfolio, they a take a long-term approach and invest in alternatives like venture capital. E.g. Yale is currently the best performing endowment fund in the United States and its venture investments returns exceeds all other asset classes. Since 2008 to 2018, Yale has increased its asset allocation in Private Equity / Venture Capital from 20.2% to 33.1%, out of which 19% is venture capital, compared to 13.7% in 2014 and just 10% in 2013. Yale’s target venture capital allocation for 2018 was 18.0%, which exceeded the 5.5% actual allocation of the average educational institution. Yale’s venture capital portfolio is expected to generate real returns of 16.0% with risk of 37.8%. Over the past twenty years, its venture capital program has earned an outstanding 165.9% per annum.
Yale Asset Type
Allocation
Return
Absolute Return
26.10%
4.80%
Domestic Equity
3.50%
6.00%
Fixed Income
4.20%
0.50%
Foreign Equity
Emerging Equities
8.50%
7.50%
Developed Equities
7.00%
6.00%
Leveraged Buyouts
14.10%
10.00%
Natural Resources
7.00%
6.40%
Real Estate
10.30%
5.50%
Venture Capital
19.00%
16.00%
Cash
0.50%
N/A
*As of June 2018
3. What are some of the hottest tech market segments you are currently looking at or investing?
NIN.VC invests in Series A & B rounds of disruptive technology companies. A disruptive technology is an innovation that changes an existing industry and also helps create a new market and value network, displacing an earlier technology or a way of doing business. Some of the sectors we are currently focused on are 3D printing, the 4th industrial revolution, cloud computing, virtual reality, financial services, education software to name a few.
4. When should one start investing in a venture capital fund? When should one expect returns?
A typical investor base in a venture fund would be institutions, pension funds, endowments, etc. NIN.VC is a unique and first of its kind crowdfunded technology venture capital fund for accredited investors. While there are restrictions on who can invest in NIN Ventures Technology (QP) Fund, it is never too late to start investing in venture capital. One must be an accredited investor and verify themselves as an accredited investor to invest in the NIN Ventures Technology (QP) Fund. However, note that Venture capital is a long term investment and the life of the fund ranges from ten to sometimes twelve years with returns coming in as and when exits occurs in the form of an IPO or M&A, which could be five or seven years into the life of the fund.
*An accredited investor is an individual with an income of more than $200,000 per year, or a joint income of $300,000 in each of the last two years OR has a net worth exceeding $1m either individually or jointly with his or her spouse, excluding the primary residence. For an Entity, any trust, with total assets in excess of $5 million qualifies.
5. How can one invest in NIN.VC?
NIN.VC is a unique and first of its kind venture capital fund that is offered online. One can visit www.nin.vc and SIGN UP. Sign up is simple, first name, last name, email, password, and acknowledge you are on accredited investor. Once you sign up, you get access to our marketing materials (i.e. PPM, Investor Presentation, and Other suggested readings). You get invited to attend our events and calls. You can also schedule a one on one meeting with us at our office or online via skype. Once you decide to make an investment accept the risk and disclosure statement that will explain what venture capital investment is. The next step is to verify accreditation. Once that is in order, it’s only a matter of filling out subscription document and a W9 Form on www.nin.vc. The last step is payment and it’s as simple as selecting the payment method, and the amount you wish to invest.
The United States Financial market is the largest and represents 7.3% (or $1.4 trillion) of U.S. gross domestic product. In 2015, the United States exported $119.6 billion in financial services and insurance and had a $46.7 billion surplus in financial services and insurance trade (excluding re-insurance, the financial services and insurance sectors had a surplus of $88.4 billion). The financial services and insurance sectors employed 6.2 million people in 2016. The securities subsector of the industry shows great potential for employment growth, with a 12% increase expected by 2018. At the end of 2016, 933,700 people were employed in the securities and investment sector.
Investment in the U.S. financial services industry offers significant advantage for financial firms. In 2015, at least 130 of Fortune's Global 500 companies have chosen to locate their headquarters in the United States to take advantage of its creative, competitive, and comprehensive financial services sector. The industry offers the greatest array of financial instruments and products to allow consumer to manage risk, create wealth, and meet financial needs. The five major subsectors in this industry are: banking, asset management, insurance, venture capital, and private equity.
Banking: As of the end of 2016, the U.S. banking system had $16.8 trillion in assets. It supports the world’s largest economy with the greatest diversity in banking institutions and concentration of private credit. In 2016, its net income was up 5.0% to $169.3 billion.
Asset Management: The U.S. asset management subsector is unrivaled in its depth and diversity. U.S. asset managers are currently meeting the pension management needs of over 60% of the global retirement market. Total U.S. retirement assets were approximately $26 trillion at the end of 2016. Moreover, if insurance assets and mutual funds are included, U.S. asset managers held nearly $51 trillion of long-term conventional assets under management in 2016, or over 47% of the global total for these funds.
Insurance: In 2015, the insurance industry’s net premiums totaled approximately $1.2 trillion. According to NAIC data, premiums recorded by life and health insurers accounted for 45%, and premiums by property and casualty insurers accounted for 55%. Additionally, about one-third of all reinsurance sold worldwide is bought by U.S. firms. International insurance companies are actively seeking business partnerships and collaborations with U.S. insurance companies.
Venture Capital: The venture capital industry was created in the United States and our venture capital ecosystem continues to support many of our most innovative companies. In 2016, 253 venture capital funds raised $41.6 billion, a ten-year high, to deploy into promising startups. Venture Capital backed companies employ 38% of the U.S. workforce within public U.S. companies and account for 82% of private sector research and development since 1979. Annually, VC backed companies have historically generated revenue equal to 21% of U.S. GDP. (Source: Stanford University and NVCA)
Private Equity: U.S. private equity firms invested more than $644 billion in U.S.-based companies in 2016. The private equity industry in the United States comprises nearly 4,500 investment firms, operating U.S. based businesses in all 50 states. Companies backed by U.S. private equity firms employ 11.3 million people in the United States and 19.6 million people worldwide. In 2016, business services and consumer-related businesses attracted the majority of U.S. private equity investment. Source: The International Trade Administration (ITA), U.S. Department of Commerce
Over the years technology has changed the Financial Services industry and now FinTech has transformed into digital banks and banking software, payments and remittances, robo advisors and personal finance, block chain and digital currencies, and personal finance both business and consumer. While the total size of the US Fintech market is difficult to reconcile, it is likely between 0.5% and 1.5% of total financial services revenue as reported by the US Census.
The 2008 Financial Meltdown led to a liquidity crises for entrepreneurs, companies, LPs, & VCs. Fewer IPOs in the market means no exits for VCs, no returns for LPs, and as a result venture funds were on a decline. No new funds means less startup funding, low employment, and slow economic growth. Thus on April 5, 2012, The Jumpstart Our Business Startups Act (JOBS Act) was introduced, which enables crowdfunding for all Americans.
Crowdfunding is a practice of funding a project or venture by raising contributions from a large number of people, typically via the Internet. The market is flooded with various types of crowdfunding options like donation, reward, lending, equity, royalty, and even hybrid versions. Since 2014 the crowdfunding industry has grown from $16 billion to an estimated $34 billion in 2015 and is doubling or more every year, and according to the World Bank estimates, crowdfunding will have a global market of $96 billion by 2025 - 1.8 times today’s global Venture Capital industry. The two most popular types of Crowdfunding methods are Reward and Equity. For rewards based Crowdfunding, entrepreneurs pre-sell a product or service to launch a business, and some times even in return for gifts or thank you notes. For equity Crowdfunding, the backer receives share of a company, usually in exchange of the money pledged. For NIN Ventures (or NIN.VC), it would be limited partner interest in the NIN Ventures Technology (QP) Fund. However, there is a major flaw with Crowdfunding in general; and that is what NIN.VC is solving.
"I come from an Entrepreneurial family so I can speak on their behalf. Entrepreneurs are brave and courageous bunch that are determined to change the way an existing industry functions. On that journey they need lot more than just financing. They need guidance or domain expertise, help with PR/marketing, recruiting, viable exit strategy, more often follow up financing, etc., which Crowdfunding portals are not able to support.
On the other hand Crowdfunding exposed investors to a whole new asset class, which the normal population never had the knowledge or expertise to invest in. About 99% of startups fail, on top of that low minimum investments like $1,000 does not give them a say or a board seat, putting investors at high degree of risk.
At NIN.VC we solved all of those issues. NIN.VC provides diversification, we take board seat on all our investments and lend the necessary support that an Entrepreneur needs to build a business, like they would get at a traditional Venture Capital fund. And are also in a position to gauge and be a part of the valuation process when it comes to addressing dilution and follow up financing rounds. However, the most IMPORTANT part that investors cares about is the ability to direct invest and enjoy direct returns, which is not the case with a traditional venture capital fund."
NIN.VC is a Crowdfunded Technology Venture Capital firm offering membership interests under the JOBS Act & Regulation D of the US Securities Act of 1933. NIN.VC is a unique and first of its kind attempt to bring Venture Capital retail and give people the freedom to directly invest in a fund with an amount of their choice, which also leads to a better financial reward system. This offering is being made via general solicitation and general advertising, which is permitted by Rule 506(c) as contemplated by Title II of the JOBS Act. This rule came into effect Sep 23, 2013 and we were the first ones to go live with a website and videos about our fund. NIN Ventures also became the first venture fund to be seen on a billboard, which was followed by in taxi ads and other social media facilitated marketing. Learn more about us on Facebook, Twitter, LinkedIn, NIN Ventures TV, etc.
NIN.VC invests in series A & B rounds of 3D printing, the 4th industrial revolution, ad tech, financial services, education software, and other disruptive technology companies. During the postwar period, recessions and recoveries, were mostly matters of business cycles. When demand recovered, GDP growth resumed, and employers hired again. But for the past two decades, this pattern has been broken. Innovation and investing in new technologies and startups is the solution to job creation – but are we creating jobs at the cost of the consumer and in return damaging our economy?
Currently, the US Asset Management market is $51 trillion, and the global alternative asset market is approximately $8 trillion and expected to be $14 trillion by 2020, according to PwC. Crowdfunding is estimated to have a global market of $96 billion by 2025. While there a huge potential for growth in this space, currently majority of crowdfunding investors are pouring their money investing in companies exposing themselves and the American Economy to a high degree of risk, with a 90% start up failure rate. Recently, the SEC approved Title III JOBS Act, Equity Crowdfunding for non-accredited investors, which allows any U.S. citizen, regardless of income, to make direct investments via a Crowdfunding portal. However, investment in a fund like ours is still limited to accredited investors. Given funds are a less riskier asset class compared to Crowdfunding in companies, perhaps it’s time to revisit their investor eligibility, alter the definition of an accredited investor, and make Crowdfunding available for everyone.
With NIN.VC, we would like to truly democratize venture capital. E.g. Yale is currently the best performing endowment fund in the United States. Since 2008 to 2016, Yale has increased its asset allocation in Private Equity / Venture Capital from 20.2% to 30.9%, out of which 16.2% is venture capital compared to 13.7% in 2014 and just 10% in 2013. In general, most people have a three dimensional portfolio (i.e. stocks, bonds, and money market), but if you look at Harvard and Yale’s portfolio, they a take a long-term approach and invest in alternatives like venture capital.
NIN Ventures Technology (QP) Fund is an opportunity for "accredited" individuals / firms to invest in venture capital for a minimum amount of $100,000 using multiple investment options like self-directed IRAs, defined benefit plan, digital currencies (E.g. Bitcoin, Litecoin, Dogecoin), or a regular checking / savings account. An accredited investor is an individual with an income of more than $200,000 per year, or a joint income of $300,000, in each of the last two years and expect to reasonably maintain the same level of income OR have a net worth exceeding $1 million, either individually or jointly with his or her spouse, excluding the primary residence, qualifies as an accredited investor. For an Entity, any trust, with total assets in excess of $5 million qualifies.
Log on to www.nin.vc and explore the world of investments with us! About Ms. Nin Desai:
Ms. Desai heads NIN.VC, a Crowdfunded Technology Venture Capital firm. Her experience spans all facets of mergers and acquisitions, and corporate finance including public offerings and private placements from private equity to investment banking and investment management. Her corporate finance transactions include RACK, LOOP, LQDT, DBTK, AMIS, SLRY, VOCS, OWW and others. Her M&A deal sheet includes the sale of Financial Profiles to EISI, Buyseasons to Liberty Media, sale of Sircon to Vertafore, and others. She is a Microsoft Certified Systems Engineer (MCSE) and has a technical diploma in E-commerce by IBM, holds Series 7 and 63 licenses from NASD. She holds an B.B.A and M.B.A in Finance / International Business from Loyola University of Chicago, and most recently attended leadership program in Private Equity and Venture Capital at Harvard Business School.
Ms. Desai has been awarded 2015 CEO Of The Year – Illinois, for innovation and contribution to the Venture Capital & Private Equity industry by Acquisition International magazine and Private Equity Fund Manager to Watch for 2017 by Corporate America. NIN.VC has been the recipient of several awards including Wealth and Finance International Magazine's "Best Technology Venture Capital Fund - Illinois" for the Alternative Investment Awards, the "Best Crowdfunded Technology Venture Capital Fund - US" for the Fund Awards, and “Leaders in Private Equity – Illinois” by Corporate Vision magazine to name a few.
Venture capital provides financing to early stage emerging
companies with high growth potential in exchange for equity / an ownership
stake. The risks VCs take investing in disruptive technologies or business
models yield higher returns their limited partners (or investors) require.
As these companies grow, they create employment / jobs and the economy prospers. Since beginning of the 20th century, venture capital has been the domain of
wealthy individuals and families. A typical LP based in a venture fund would be
institutions, pension funds, endowments, family offices, etc.
However, the 2008 Financial Meltdown led to a liquidity
crises for entrepreneurs, companies, LPs, & VCs. Fewer IPOs in the market
means no exits for VCs, no returns for LPs, and as a result venture funds were
on a decline. No new funds means less startup funding, low employment, and slow
economic growth. Thus on April 5, 2012, President Obama signed, The Jumpstart
Our Business Startups Act (the JOBS Act), which enables
crowdfunding for “accredited” Americans. An accredited investor is an
individual with an income of more than $200,000 per year, or a joint income of
$300,000, in each of the last two years and expect to reasonably maintain the
same level of income OR have a net worth exceeding $1 million, either
individually or jointly with his or her spouse, excluding the primary
residence, qualifies as an accredited investor. For an Entity, any trust,
with total assets in excess of $5 million qualifies. Crowdfunding is a practice of funding a project or venture by raising contributions from a large number of people, typically via the Internet. The market is flooded with various types of crowdfunding options like donation, reward, lending, equity, royalty, and even hybrid versions. The two most popular types of crowdfunding methods are reward and equity. For rewards based crowdfunding, entrepreneurs pre-sell a product or service to launch a business, and some times even in return for gifts or thank you notes. For equity crowdfunding, the backer receives share of a company, usually in exchange of the money pledged.In case of NIN.VC, it would be limited partner interest in the NIN Ventures Technology (QP) Fund. While the Obama Administration achieved success with the
JOBS Act by creating jobs for the Economy, it also did a disservice to the people
of United States by encouraging crowdfunding in companies directly, which exposed them to a high degree of risk with such an asset class.With the traditional venture capital investment process, we were all indirectly invested in a venture capital fund via a pension fund or institution. Those pension funds and institutions had a diversified portfolio, on top of that they were investing in the venture funds and not companies. So what is the difference between crowdfunding in a company directly and fund or NIN.VC?
01. Diversification A fund or NIN
Ventures Technology (QP) Fund makes multiple investments in companies in
different sectors (i.e. 3D Printing, Cloud Computing, Education Software, etc.)
during Series A and / or B financing, this strategy helps diversify the fund’s
portfolio, which is not the case when one invests in a company directly. Think
of it as investing in a Mutual Fund vs. Stock. 02. High Risk Given it’s
diverse portfolio the fund reduces it’s risk, where as direct investing in a
company exposes that investment to higher degree of risk, an appropriate
analogy would be to put all your eggs in one basket. A logical follow up argument would be, what if one makes multiple direct
investments in companies of their choice using a Crowdfunding portal over
investing in a fund? Given 90% of the startups fail, even if one
invests in several companies via a Crowdfunding portal, it becomes solely a
numbers game i.e. Quantity over Quality. On the other hand the fund management
invests in an Entrepreneur because Entrepreneurs build companies and not the
other way round. We (NIN.VC or any venture fund) not only
provide adequate financing (including follow up financing rounds and access to
our syndicate partners), but also lend our domain expertise and network of
partners to help companies with recruitment, PR and marketing, and a viable exit
strategy. 03. Professional Management Direct
investing in a company requires time, expertise, due diligence, constant follow
up and / or monitoring. On the other hand NIN.VC acts like a financial advisor
and works for the investor and in the fund’s best interest. The fund also
provides quarterly audited financial statements to the investor on the progress
at the fund. 04. Board Representation A $1,000
direct investment in a company using a Crowdfunding portal does not give an
individual enough rights, while a venture fund or NIN.VC takes board seat on all their
investments. Thus we are in the loop with the company management when it comes to
keeping tabs on the progress at the company and is in a position to help / make
suggestions on several occasions, gauge and be a
part of the valuation process when it comes to addressing dilution and follow
up financing rounds.
Currently
majority of crowdfunding investors are pouring their money investing in companies
exposing themselves and the American Economy to a high degree of risk, with a
90% start up failure rate. And since 2014 the crowdfunding industry has grown
from $16 billion to an estimated $34 billion in 2015 and is doubling or more
every year, and according to the World Bank estimates, crowdfunding will have a
global market of $96 billion by 2025 - 1.8 times today’s global venture capital
industry. Does replacing smart money with crowdfunding justify its short-term
effect or the JOBS created? Did Americans bail out the U.S Economy or are we
waiting for another bubble? Watch Ms. Desai's video to learn more about NIN.VC, how we are solving a major flaw with Crowdfunding, what are the benefits of Crowdfunding from both an Investors and Entrepreneurs perspective, investment strategies, importance of diversification, etc.
Given the
long-term (5-10 years) venture capital investment cycle, we will probably not
see the negative effects of crowdfunding for few more years. However to make matters worse, recently, the SEC approved Title III JOBS Act,
Equity Crowdfunding for "non-accredited" investors, which allows any U.S.
citizen, regardless of income, to make direct investments via a crowdfunding
portal. But, investment in a fund, like ours, is still limited to accredited
investors. Are American people given the wrong kind of freedom when it comes to
their investment decisions?Given funds are a less riskier asset class compared to crowdfunding in
companies, perhaps it’s time to revisit their investor eligibility, alter the
definition of an accredited investor, truly democratize venture capital and make
crowdfunding available for everyone... While there is a major flaw with crowdfunding in general, it does allow investors to direct invest and enjoy direct returns in an investment of their choice, which is not the case with a traditional venture capital investment process. Ignorance is bliss and partial knowledge can be dangerous, thus besides proper investor education, emphasis also needs to be given to FAKE NEWS or media outlets that might be influencing American people. When investing in public company stocks, investors have stock estimates and research reports from various different analysts, which is not the case with private company investing. More startup / technology coverage by media outlets will create investor awareness on this topic. However, journalists must act responsible and should be required to attain a license or certification to cover such stories.
About NIN Ventures (or NIN.VC):
NIN Ventures is a unique and first of its kind crowdfunded technology venture capital fund that invests in series A & B rounds of 3D printing, the 4th industrial revolution, cloud computing, financial services, education software, and other disruptive technology companies. NIN Ventures Technology (QP) Fund is available to "accredited" individuals / firms for a minimum amount of $100,000 using multiple investment options like self-directed IRAs, defined benefit plan, digital currencies (E.g. Bitcoin, Litecoin, Dogecoin), or a regular checking / savings account.
NIN.VC is offering membership interests under the JOBS Act & Regulation D of the US Securities Act of 1933. This offering is being made via general solicitation and general advertising, which is permitted by Rule 506(c) as contemplated by Title II of the JOBS Act. This rule came into effect Sep 23, 2013 and we were the first ones to go live with a website and videos about our fund. NIN Ventures also became the first venture fund to be seen on a billboard, which was followed by in taxi ads and other social media facilitated marketing. Learn more about us on Facebook, Twitter, LinkedIn, NIN Ventures TV, etc.
