If you weren’t at this year’s Venture Atlanta conference, then you truly missed out on an exceptional event. VCs and founders from around the world gathered together for two packed days of networking, company pitches, and fireside chats. PS27’s Fund Manager, Chris Byers, and Investment Analyst, Nick Gurrero, headed up to the Woodruff Arts Center in the Big Peach to scout for innovative tech companies and hear from industry leaders. Here are their key takeaways from the 15th annual Venture Atlanta conference.
1. Prepare for a Hurricane Economy
Is our economy in a state of crisis?
Jeff Immelt, former chairman and CEO of GE, led the first fireside chat and shared his thoughts on the current state of the economy, reflecting on his time at GE and lessons learned there. Jeff’s outlook on the current state of VC was less stark, viewing this as just another part of the economic cycle, and offered a few points of advice:
When facing challenges to the business, the top priority is to get access to cash and protect the company’s cash. It’s important to keep your team busy by giving them problems they are able to solve. It is the leader’s job to focus the attention of the team on what matters. At PS27, our purpose is to empower entrepreneurs with capital, connections, and community.
During these times, it is better to raise more at a lower valuation than less at a higher valuation. Economic up-and-down cycles are a constructive part of business and can actually help entrepreneurs. We saw some of the greatest sales in portfolio company products during the pandemic.
There are probably too many companies in the ecosystem, resulting in creative destruction.
“You make better risk-reward decisions during bad times,” said Immelt.
Consider what talents board members bring to the table for the company’s worst days, not the best days. What skill sets do they have to assist in handling a crisis?
Dennis Lockhart, former president and CEO of the Federal Reserve Bank of Atlanta, also weighed in on this issue. He categorized recessions from 1-5 (like hurricanes) and views the current situation as a short category 1.
2. Ask the Right Questions
When investing in any venture, it’s important to ask a lot of questions. Here’s what to consider before investing in a company, according to Jeff Immelt.
How large is the size of the idea?
How do the margins compare with the size of the investment?
Is this the right team?
Who could be a potential buyer?
At PS27, our investment process starts by reviewing a founder’s pitch deck submitted through our website. Next, we set up a meeting to learn more about the company, its founder, and the team behind the idea. If the due diligence process moves forward, we engage the team in a 4-hour workout. No, not at Planet Fitness; our business workout meetings are typically held on Zoom or at PS27 HQ to establish if our team is a good fit for your business. During this 4-hour meeting, we ask a lot of questions and test the founder’s ability to work as a team and take feedback.
3. Keep Remote Work to Capture the Best Talent
What will it take to improve labor force participation?
One of the subjects at the forefront of everybody’s mind was that of the labor force. One of the biggest issues plaguing the startup industry right now is the lack of talent. Some points shared at the event on this:
- We should expect that the labor market is going to be tight for the foreseeable future.
- Covid accelerated the number of retirees, and an aging demographic is negatively impacting the number of labor force participants.
- People feel more productive at home than in the office. Remote-first workplaces will see higher rates of retention.
- There have been lots of gains made for minorities by working from home. It brought people to the same playing field as everyone else, and by going back to the office, they are afraid of losing that.
About Venture Atlanta
Venture Atlanta, the Southeast’s technology innovation event, is where the region’s most promising tech companies meet the country’s top-tier investors. As the Southeast’s largest investor showcase helping launch more than 700 companies and raise $6.5 billion in funding to date, the event connects the region’s top entrepreneurs with local and national investors and others in the technology ecosystem who can help them raise the capital they need to grow their businesses. The annual nonprofit event is a collaboration of the Atlanta CEO Council, Metro Atlanta Chamber, and the Technology Association of Georgia.
About PS27 Ventures
PS27 Ventures is an early-stage venture capital firm with the mission to empower entrepreneurs.
The PS27 Rhea Fund is a 20 million-dollar venture capital fund focused on early-stage technology companies. Rhea Fund is seeking to invest in early-stage solutions in SaaS, HealthTech, FinTech, Sustainability, and E-Commerce companies that can scale rapidly. Rhea Fund is also interested in founders who are women, veterans, and people of color.