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The potential value a celebrity investor can bring to a consumer company, beyond just writing a check, is obvious: marketing and promotion. But this value is less clear when it comes to supporting B2B startups. Alex Pall and Drew Taggart, also known as the Chainsmokers, believe their venture capital fund Mantis VC can deliver added value that traditional venture capital firms cannot provide.
At TechCrunch Disrupt 2024 alongside one of their founders, Dan Lorenc, co-founder and CEO of cybersecurity startup Chainguard, Pal said the group initially got into B2B investing because they were tired of feeling like they were the QVC for startups working with consumer companies that wanted Just work with them for promotion.
The duo became increasingly interested in B2B due to the strong market opportunities in this field despite not having much experience in this type of business.
“It seemed like a market opportunity to kind of stand out and maybe bring a different perspective or a different kind of value to those types of companies,” Ball said. “Our strategy and the way we design our fund is to be like the Robin to everyone’s Batman, and kind of provide a different level of support and perspective and connection that maybe a traditional fund doesn’t focus on.”
Taggart added that they’re not looking to be the next Sequoia either, because that company already exists and comes with a certain level of value.
“Our goal at Mantis was just to get into these deals, outperform everyone else at the cap table, see what volatile way we could add value, and then hopefully our founders would pivot and help us kind of build our company,” Taggart said. business within this community.
One area they believe they can help businesses is through their network. The Chainsmokers have played specials for nearly every Fortune 500 company, Ball said. Although they didn’t think of it as building an investment network at the time, they have since been able to connect their portfolio founders to these companies.
“It’s worked out really well for us, because these are, you know, some really strong decision makers or leaders in their own fields,” Pal added.
Lorenc also supported these statements. He added that they not only helped him with his introductions to potential clients, but they also helped on the recruiting front as well.
Lorenc was unsure whether to hire a potential employee because of a dispute over compensation. But they were able to convince this candidate after he received a five-minute video of Pal explaining why he should join.
“You don’t want to be a Sequoia,” Lorenc said. “There’s already Sequoia. They invested in us at the same time as Sequoia. Sequoia is great. They have an amazing platform, an amazing team, an amazing network, all of that. But when you have enough of those investors, it starts to overlap, and you get diminishing returns.” It’s kind of the same network, the way I describe it is completely different.
The Chainsmokers hope these early B2B investments will help them get taken seriously in this space so they can continue to build that portfolio.
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