Let’s say that you are a smart, driven entrepreneur with a groundbreaking idea to revolutionize food packaging and eliminate all those Styrofoam containers littering the landfill. You’ve got a patent. You’ve got passion. What you don’t have is money. Plus you are in Europe, where early-stage investing tends toward the risk averse. What to do?
If you are startup ValueForm and your CFO is Mandar Kulkarni, ’10 (EXP-15), you put your pitch together and take it to CAN, the Chicago Angels Network in London. Founded in 2012 by Shehreyar Hameed, ’05; Jonathan Weiss, ’00, MD ’01; and Rama Veeraragoo, ’12 (EXP-17), the global network of domain experts, mentors, and angel investors gives Booth graduates a chance at early-stage investment opportunities with entrepreneurial startups and extends the school’s commitment to innovation.
In early 2012, Hameed had started investing in startups, and developed the idea of CAN to provide access to compelling investment opportunities to the Booth alumni network in London, elsewhere in Europe, and globally. “I wanted to invest and help entrepreneurs harness our strong, global, and diverse network of deep domain expertise to build successful businesses,” said Hameed, a senior financial professional based in London. “Hence the motto, ‘Engage! Mentor! Invest!’ It’s about setting young companies on the right path and opening doors for them. That’s where the real value comes from.”
Alumni such as Yesenia Hernandez, ’05, former COO of CAN, didn’t always have time for more conventional alumni networking events. Still, “we want to engage with one another, with the school, and with the entrepreneurial community,” she said. “We have know-how. Equally, for those of us who have money, we can put our money behind those ideas.”
CAN allows alumni such as Hernandez to put their passion for innovation to practical use. In its five years of existence, CAN has reviewed more than 750 startups. Out of that pool, the network selected roughly 50 for consideration, and to date investors have backed 17 new ventures, to the tune of $1.2 million. “Passing the million-dollar mark was a big milestone,” said Cornel Chiriac, ’12, part of the group’s management team of five and managing partner at London Venture Factory.
As a Chicago Booth affinity group rather than a venture fund, an investment bank, or a broker, CAN operates as an angel network such as those at other leading MBA schools. It accepts no liability for investment decisions but acts as the “dating service” for entrepreneurs and potential investors.
When Chiriac came on board in 2015, the group had facilitated only half a million in investments and was struggling with a big idea that threatened to get away from the group of volunteer alumni who are committed but otherwise employed.
CAN is made up entirely of volunteers, so it asks a lot of alumni with full-time jobs and personal commitments. “I have weeks when CAN is a full-time job,” Chiriac said. “We have to make sure we source high-quality companies. Origination takes a lot of time. We have alumni who are experts in their field fly in from across Europe to meet with entrepreneurs, prepare them for the pitch events, and do the due diligence.” Volunteer alumni typically devote between 20 and 40 hours during the selection process, while the management team spends five to 20 hours a week on CAN. They rotate after 18 to 24 months, usually moving into advisory or mentor roles.
After CAN’s initial success, Hameed realized that it lacked the requisite structure to scale up. That is when Hernandez first got involved, along with Andrew Holmes, ’09; Baris Bayazit, ’06; Eytan Behmoaras, ’06; and Nitin Manoharan, ’14 (EXP-19). The management team set about developing partnerships with London-based incubators and accelerators, a regular calendar of events, and a constant deal flow in order to grow. “Chicago Booth’s alumni team led by Penka Bergmann, AM ’00, was instrumental in helping us build CAN,” Hameed added.
“The vision is to have sound fundamentals,” Chiriac said, “in order to scale up and export the idea to other countries and other alumni groups.” India, Singapore, Hong Kong, and New York City have already expressed interest. CAN is currently working with Booth’s Alumni Relations team to develop fundamentals that will ensure that, as CAN takes the Booth brand into entrepreneurial communities around the world, there is a blueprint that can be cloned worldwide. “Our partners are global,” Chiriac said. “That will make it easier for us in a global chapter framework.”
From its rather seat-of-the-pants beginnings, CAN now offers well-attended events where Booth alumni meet with entrepreneurs, investors, and other interested parties. More than 500 people have attended its quarterly events, three annual pitches, and one educational event. “As an alum, it is gratifying to continue the Booth experience with application of a clear, structured screening, querying, and testing of assumptions in various business models,” said Andrew Irvine, ’08 (EXP-13), CEO of TUSK Capital Management. “CAN is excellent for increased presence of the Booth brand in an exciting sector.”
At the group’s winter pitch event in March at Booth’s campus in London, six technology startups touted their ideas. Potential investors heard about everything from machine learning for data mining legal documents to satellite and drone imagery for natural-resources exploration.
CAN’s next step is to prepare for expansion in terms of other locally run chapters as well as partnerships. “We already partner with Microsoft Venture Accelerator, Barclays Accelerator, and Founder Factory, as well as organizations such as Winton Capital, Deloitte Ventures, and Carbon Trust Innovation,” said Chiriac, “and CAN is looking for partnerships with other leading VCs, incubators, accelerators, and universities.” Investors will always be interested in innovation and excited by groundbreaking ideas. In addition, Chiriac added, CAN is a way that alumni can “give back to Booth, which gave us so much.”
—By Rebecca Rolfes