The Story Behind Horizan VC: Pt 1

The story behind how Horizan VC started actually goes way back. 

To my first year of university.

Back then, I was a budding student entrepreneur trying to build an app that matched U.S. high school students to their best fit universities, a wide-eyed kid who had barely networked or attended any business events prior to this point. I remember having this illusion in my mind that building a business would be smooth and if I followed a formula given to me by “experts,” all would be smooth sailing and I’d be a millionaire within a few years. Instead, here’s a conversation that went on in one of the networking events I attended:

“How’s the startup life?” 

“Not too bad, just trying to get some user research and wireframes sketched out. You?”

“It’s been tough. I’m currently working a full-time job, so I only get to spend about 10-20 hours a week working on my startup. Because my family doesn’t have a whole lot of money, I’m eating into my savings barely trying to get this thing going. I’m afraid of maxing out my credit cards because I don’t want to be homeless or without food.”

The same sorts of conversations circulated when I moved from Seattle to London. Thus, I learned of the reality of most bootstrappers trying to start a SaaS business; without family members ready to bail them out, they have to rely on whatever skills they’ve either learned or naturally picked up on their own to try to slog through the difficult first stage from idea -> something that demonstrates their idea has demand. I was lucky enough to have gotten a chance to procure some friends and family funding for my app, which lasted me a solid 3 years and 2 product cycles and experiences I will forever be grateful for. For instance, other networking conversations with founders went like this:

“These pre-seed angel investors are ruthless out here! They ask me for metrics that I can barely curate without existing capital. I’m thinking of moving to the Bay Area next month. Investors here are way too conservative and will never give me a chance. Plus, I feel like I’m being judged against because I’m not blonde with blue eyes, and I didn’t graduate from Harvard/Stanford.”

Learning all of these problems made me determined to, long term, find a way to make sure that every founder who deserved capital would get it (not every founder deserves funding), and every founder who was not ready to receive capital would be provided the resources to get them to a “ready state,” no matter where they lived. After I completed my stint at being a startup founder (which ended a bit unceremoniously), I experimented with a bunch of ideas and projects that I thought would help founders. Among them:

1. A cofounder matching tool, which didn’t work because there weren’t enough developers in my network/regional meetups who were willing to spend extra hours being someone else’s CTO for equity,
2. A ProductHunt “competitor” for those who weren’t in the tech industry to discover startups they could use in their daily lives, which proved futile as most of those not in the tech industry were generally satisfied with the services they were using,
3. An accelerator for idea stage startups which I struggled to put together because I couldn’t amass enough boutique resources to help founders in a unique way,
4. A pretotyping consultancy aimed at helping aspiring founders validate their ideas using creative, manual experiments, to which after 3 months of running this I realised I couldn’t scale.
   

In between those experiments I also started learning a lot about the investing world. Firstly, I read Jason Calacanis’ book Angel, where I learned the basics of procuring dealflow, finding the best startups to invest in, and how to get involved in syndicates for $1000-$2000 per small ticket size. I then joined a VC Hive Mind community, Odin, and learned even more about how angels and VCs operated. Subsequently, after learning that the majority of all startups weren’t going to get funded this way, I dove headfirst into researching the world of Alternative Financing. Among the funds I studied: Tinyseed, Calm Company Fund (formerly Earnest Capital), Zebras Unite Capital, and other RBF models like Pipe and Clearco. 

One day, after going on a massive Google binge, I found Chisos Capital, somewhere after page 2. The terms seemed genius to me, and I wondered why I had never thought of it before: why not get the best of both worlds by combining an income share agreement (future earnings agreement in the UK) with a SAFE note, thus giving investors venture-scale upside and the downside protection to invest in idea-stage and side hustle founders? That evening, I couldn’t sleep, dreaming of all the possibilities this unique investing method could bring if I brought this to the UK. 

After pondering for a few days, I sent a Twitter DM to the founder, Will Stringer.

Part 2 coming soon :)