1864 Fund

The Early Stage Landscape is Changing

As deal pace and valuations are declining, we will capitalize on adjusted, more realistic, valuations. Because overall venture funding is slowing, our capital will be more competitive and more meaningful to seed-stage companies who will continue to innovate. When paired with a contracting labor market we see a robust environment for new company formation.

Look back at companies founded/founded 2007-2014:

General Partners

Jeff Saling- StartUpNV Executive Director

• Co-founded StartUpNV in 2017
• Founding member and Vice Chair on the Nevada Governor's Council on Startups and Venture Capital.
• Enterprise SaaS Startup Founder with 4 successful exits by IPO or acquisition between 1992 and 2016 (plus 2 failures with many lessons)
  
  Bill Slikkerveer- StartUpNV Board Member
• US Naval Officer 
• Chemical Engineering, UC Berkeley
• American Airlines pilot and union representative
  

• Founder & Director: MindMed (Nasdaq: MNMD)
• Consultant to World Bank & BIO Ventures for Global Health
• Early Startup Executive with Nektar Therapeutics 
• J.D. specializing in patent law

Piotr Tomasik- StartUpNV Chief Startup Officer, StartUpVegas Co-Founder

• Co-Founded StartUp Vegas in 2021
• Co-Founded Influential, a company specializing in artificial intelligence to match brands with social media influencers. The company grew exponentially to become the most valuable VC-Backed company in Nevada in 2018, as Recognized by Pitchbook.
• Serves on Nevada Governors council on StartUps and Venture Capital and the UNLV computer science advisory board.

Leith Martin- StartUpNV Deal Flow Manager 

• Executive Director of the Troesh Center for Entrepreneurship and Innovation in the Lee Business School
• Rebel Venture Fund Board Member
• Global Consortium of Entrepreneurship Centers Advisory Board Member
• Co-founder of Equiinet, providing business communications services worldwide. 

About

Publication Date: 9/19/22

As a $10M seed-stage fund, The 1864 Fund is affiliated with StartUpNV’s programs supporting early-stage companies and founders. The Fund invests in underserved capital markets and is headquartered in Las Vegas for direct, non-stop access to/from more places in the US than any other city. We partner with local economic development authorities to access overlooked founders and companies based in the American interior. 1864 led Investments are between $350K and $500K in rounds from $500K – $2.5M. We syndicate (follow) in trusted partner led deals for $100k to $200k to increase our deal count and lower overall risk in the fund. 

Fund Summary

How we look at opportunities

What we like:

• Subscriptions and/or recurring revenue
• Highly scalable tech
• Practical application of emerging tech (blockchain, web3, decentralization)
• Marketplaces with hard-to-secure inventory
• Culturally or regionally significant impacts
• Capital efficiency
• Full-time founders

Bonus:

• IP
• Team: deep or relevant experience / expertise and balanced skillsets
• Team: prior experience raising and returning capital to investors
• Traction: Sales @ $40k -$50K MRR
• Priced Rounds

What we don't like:

• Coins/Tokens “only” or limited practical utility
• Food or supplements
• Festivals, events or productions
• Lifestyle businesses – restaurants, salons, gyms
• “Tar pit” business – idealist founders approaching ambitious markets with little competitive advantage or differentiation
• Non-U.S. Corps (with very limited exceptions)
• “Ideas” only
• Prior priced rounds with arbitrarily low valuations and/or highly aggressive terms (for investors or founders)
• Companies with sloppy or messy cap tables (lots of small checks and/or not cleanly documented)
• Teams or leagues
• Capital Intensive business (Pharma, Biotech)

Why we invest

• The company has demonstrated initial market validation and line-of-sight to sales >$500K annually
• Our money is part of a meaningful part of a larger round supported by financial growth of company.
• The company has made efficient use of capital through a novel approach or product.
• The founders are committed, determined, and leaders among their peers.
• The problem/solution addresses (or will create) a large TAM / SAM with an achievable and practical SOM.
• The deal has a realistic and reasonable valuation supported by the company's progress and industry comps.

How we invest

• Checks $150K -$500K
• Seed Rounds $500K -$2.5M, depending on valuation
• Achievable exit scenarios returning >$20M per investment (2X fund size)
• The deal has a realistic and reasonable valuation supported by the company's progress and industry comparables.
• Lead where appropriate, with board seat
• Unless offered similar / better terms, avoid deals with
  • early priced rounds involving nominal capital 
  • early rounds with aggressive terms such as full ratchet, participating preference, preference multiples, etc.

• Every opportunity QSBS qualified
• Target 1864 ownership: 5%, deal dependent (as part of round size for 15%-20%, valuation target in mid-seven figures)
• "Dream Deal": $1M round with $5M valuation (20%) for a company in a large market with founders who can execute and current run rate of $500k in annual recurring sales, growing at 10% or more month over month.