The SuperAngel phenom continues to mature. When the SuperAngels first took share away from the Series A VCs (who felt they owned the first institutional funding stage), the VC reaction was all over the map, and the punditry had a field day with VC vs. SuperAngel smackdowns, fueling the fire. We saw out-of-box VC behavior: big firms playing angel with small investments, and smaller funds playing mezzanine by buying into momentum deals (like Facebook, Twitter and Groupon) at huge valuations. Things have settled down a bit, and while it isn’t really a lovefest, the SuperAngels are happily fitting into a new ecosystem of peaceful coexistence within a very competitive VC environment. Two key insights:
- SuperAngels make the VC system more efficient, taking the early risk away and letting the bigger funds scale a validated business plan. The Bullpen Round – extending the lean SuperAngel model for one more flip of the card – also fosters the more efficient use of capital.
- SuperAngels have driven some large VCs into a Barbell Strategy, of lots of small investments in syndication with SuperAngels, and a few big bites of later-stage momentum deals. Andreeson Horowitz seemed to have pioneered this model, with lots of SuperAngel style activity and a few big bets into Skype and Twitter.
The new SuperAngel ecosystem is rapidly evolving. We are co-sponsoring an event in July to explore this new world. Rather than pit VCs vs. SuperAngels, we are bringing players in from the whole value chain, from SuperAngel to VC to Accelerator to SecondMarket. I hope you will join us.
[...] mentioned in a recent post the “barbell” strategy of Andreeson Horowitz, which has been followed by some other venture firms, notably including Kleiner Perkins. The [...]