Picture this: LinkedIn-meets-Salesforce, for potential start-up financing opportunities.
That’s the vision for CapLinked Inc., a new start-up that wants to be the go-to place for setting up and closing deals, as well as managing portfolio companies after the close.
The company has raised $525,000 in angel funding from Peter Thiel, Dave McClure’s 500 Startups; Joe Lonsdale, co-founder of Palantir Technologies; Aman Verjee, chief financial officer at Sonos; and David Anderson, managing partner of 7th Rig. CapLinked previously raised about $400,000 in a financing from individuals in 2010.
CapLinked co-founder and Chief Executive Eric Jackson is a former vice president of marketing at PayPal Inc. and knows investors Thiel, McClure, Lonsdale and Verjee, all formerly of PayPal.
The idea of CapLinked is that entrepreneurs can invite investors they know to join the site to review and edit documents, and share deals with advisors and other potential investors.
The online “deal rooms” are private so that only those that are invited can view them. The “deal owner” can track and see who has downloaded documents.
At the same time, the service enables people to send the deal to people in their network–with the deal owner’s approval–to make them go viral. The service is designed to use social networking to encourage people to share deals with people they know.
The service launched in October and has about 2,100 companies and 1,000 investors on the site.
“People who get invitations to deals really want to see them because they know who invited them,” CEO Jackson said.
The service is not only open to deals for investing in technology companies but also other assets such as real estate or movies. Investors on the site have to be certified as accredited investors.
Once the deal closes the service can be used by investors and fund managers to keep track of their companies. The investors can automatically ask their companies to submit metrics or information to them via CapLinked.
Many investors still use Excel spreadsheets to track their investment performance or, if they’re big enough, build their own software to manage the data. CapLinked is designed to be an online service that simplifies that management, Jackson said.
The service does not charge to use it. “I’m philosophically opposed to charging people to raise money,” Jackson said.
Eventually the company plans to implement a premium service with more features.
Unlike secondary exchange SecondMarket, CapLinked is not brokering the actual transactions–brokers can use the site and can handle transactions or outside brokers can handle deals. CapLinked also is not trying to be a marketplace for buying and selling stock, but rather a deal space and investment management tool.
Other related services include Kickstarter, Profounder and Invested.In, but those services are more about public crowdfunding, Jackson said.
COMMENTARY: According to CapLinked.com's website this is how their service works and what's included:
Free to Join
- Quickly Sign Up for Free and add your company or deal to the system
Perfect for Entrepreneurs, Brokers, Developers and Investors
- A secure and centralized platform for all of your business deals
- Use the integrated tools and free resource documents to start a conversation
- How to create and build a company on CapLinked
Create and Share Private Deals
- Upload professional looking deal summaries in just minutes
- Create deals for a capital raise, asset sale, or any kind of transaction
- Deals are private and secure—strangers can’t view them
- How to create and share a deal on CapLinked
Conduct Due Diligence
- Deal owner can see when someone downloads a file
- Investors can store private notes and ratings for their records
- Send follow-up questions to the deal owner directly through the website
Forward Deals to Others
- Recipients of a deal can share it with advisors and other investors
- Syndicating a deal is easy, which helps it to close faster
- The deal’s owner can restrict access if there are concerns
Manage Your Investment Contacts
- Keep the people you share deals with in your private address book
- Import contacts from Outlook, Gmail, Yahoo Mail, and Hotmail
- Make it easy to send deals to your connections and see when they view them
Introduce Yourself to People & Companies
- Meet investors and find interesting companies by searching on the site
- Introduce yourself to other users with a private direct message
- Send an inquiry to a company’s contact person
Investor Relations Made Simple
- Send private status updates to investors, board members, and advisors
- Customizable dashboard, document storage room, and messaging tools
- Keep your stakeholders engaged and increase the company’s value
Private Investment Portfolio
- Manage all of your private company investments in one place
- Track company news and request updates when you need them
- Easy access to historical documents
Secure and Compliant
- CapLinked is SSL and Verisign secured
- Only people in your approved network can view your information
- Investors must certify being accredited before viewing your deals
- We provide a time stamped archive of who accessed your deals and what they viewed
I like the concept of a social network to conect entrepreneurs and investors. This is quite unique. Who doesn't need something like this. Every entrepreneur I have spoken to needs capital The fact that investor's are fully-accredited gives CapLinked.com a lot of authenticity and credability.
My only concern is the potential for violating Security and Exchange Commission rules regarding solicitations by unlicensed brokers. Still it is reassuring that their investor's are all very experienced and well known entrepreneurs and investors, and hopefully have considered for this eventuality.
Courtesy of an article dated February 22, 2011 appearing in The Wall Street Journal's Venture Capital Dispatch
Comments