The two founders of Prototype Capital believe that pre-seed investment concentrated on student entrepreneurs needs to modify.
While existing micro-investment funds concentrated on young entrepreneurs invest their time in Ivy League schools and elite private associations, Prototype Capital’s founders are betting on great opportunities coming in the same places that have driven Steve Case’s “Rise of the Rush” investment thesis (along with his new Rise of the Rush fund).
Founded in 2015 from Rajat Bhageria, the former chief executive of ThirdEye, and Nandeet Mehta, the chief executive of Pyur Solutions, to create a network of student entrepreneurs and pre-seed investment scouts, the small fund is formalizing its activities this year with a tiny war chest (roughly $5 million for another 18 months).
“We at Prototype believe the world is shifting,” Bhageria informs me. “The next great invention may not be in the typical Silicon Valley entrepreneur. ”
Rather than concentrate on students and pupils registered in Ivy League or private schools like the Massachusetts Institute of Technology or Stanford, Bhageria and Mehta are Taking a Look at students in universities like Penn State, the University of California at Davis, University of Illinois Urbana-Champaign, the University of Texas in Austin; and young entrepreneurs in cities such as Ann Arbor, Los Angeles and Philadelphia.
“Right today VCs in the youthful entrepreneur ecosystem are looking at startups from schools like MIT, Penn and Stanford,” says Bhageria. “However, a great agriculture tech company may come from UC Davis instead of Stanford. ”
Investors, according to Bhageria, are completely unprepared for this change.
For Prototype, Bhageria and Mehta achieved to their network of entrepreneurs situated in such far-flung places and provided them dues charges for companies that manage to raise capital from the company.
The money for Prototype was fronted by an undisclosed Los Angeles-based venture capital company, Bhageria explained.
Prototype plans to spend between $25,000 and $50,000 to begin, and boost its obligations to $50,000 to $100,000 after the initial six months.
Beyond its attention outside of conventional geographies, Prototype believes it’s yet another advantage in the connections it’s construction with corporations.
Corporate partnerships, Bhageria says, are key to this next phase of enterprise capital expenditure.
“It’s not going to be another Snapchat that matters, it’s going to be shifting and shifting those entrenched industries. You need domain experience and you want information … you should work with governments and corporations. ”
That’therefore the company is planning to sponsor quarterly corporate presentation days in which seven Fortune 500 companies will be on-hand to listen to pitches.
Neither the attention on early entrepreneurs and pre-seed investment the push to bring corporate partners on board is that publication. Bhageria admits that Techstars and Plug and Play have leveraged corporate partners and sponsorships to provide more weight to their own early-stage programs. And Dorm Room Fund (affiliated with First Round Capital) and Rough Draft Ventures (which works with General Catalyst) are both leveraging systems of alumni to come across early-stage investments.
Still, the mix of both theses — combined with Prototype’so focus on schools outside of their standard venture networks — can give the company a leg up.
Notably, other investors are thinking about a similar approach to tapping networks of entrepreneurial ability as investors. AngelList and Boston-based Accomplice announced the $35 million Spearhead fund yesterday to pursue a similar (and much better capitalized) thesis.
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