Growceanu is a group of 15 Business Angels, active primarily in high-tech areas that contribute with money, professional and business expertise and personal connections to the development of tech start-ups with high potential of growth. In November 2019 the network secured its first deal by investing in Bright Spaces, a high-tech start-up that builds tools for the real estate business. More investments are to come in 2020. But how did they start investing together?
“We felt that we needed to organise a group of local angels able invest in local and maybe also international start-ups,” said Ciprian Man, one of the founders and ESILangel for Romania.
Just at the right time, they received support from the ESIL program. “It was the perfect timing. We were asking existential questions about angel investment. We did not really know anything much beyond what a business angel should be doing, mentoring and investing. But beyond that, we didn’t know about how we should organise deals, how we should approach start-ups and do due diligence, or how to valuate a start-up,” Ciprian said.
Through the ESIL program, the members of Growceanu had access to the expertise of the ESIL Archangels, experienced investors who, thanks to this initiative, have traveled throughout Europe for the past two years sharing their knowledge. “We learned a lot of these things from ESIL and from people like Brigitte Baumann, Philippe Gluntz and the rest of the team, the people I was talking to when attending to the ESIL Study Visits, and from the videos provided by the programme,” Ciprian said.
Just to give an example, the Growceanu members are still using the formula provided by Brigitte to evaluate start-ups. “We learned from her in a very simple way and we continue to do the same. Thanks to her we know what questions to ask and how to use that information rather than keep reinventing the wheel and going through several failures before we come to a formula. She came with the formula and helped us understand why that is the formula that makes sense, so we don’t really need to search any longer. It really applies to our situation in Romania just as it does anywhere else,” he said.
From humble beginnings to investing with the early stage funding community
The results have not been long in coming and Growceanu Angel Investment is growing fast. “We are looking to many startups, we did our first investment in 2019, and we will do more in January 2020. But the real point is that we have increased the number of angels in the group. We started with 5 and now we are 15 members, and we have 3 women who are very active,” Ciprian said. In addition to forming a large group, they wanted to recruit angels from different areas and with different knowledge, and at the moment they are achieving this. “We also reached our goal of connecting with angels from other parts of the country, primarily from Bucharest but not only, with diversified expertise & know-how. We are also connecting with early-stage funds and accelerators and working on deals together,” he said.
Creating the Romanian National Network, the goal for 2020
Growceanu Angel Investment is already investing in start-ups, organising matchmaking events to connect investors with start-up founders, and offering help for first-time investors in Romania. The new aim for 2020 is creating the Romanian Business Angels Federation. “The Federation is a national network, to oversee, protect, and pursue the interest of Business Angels across Romania and, also to be more representative when talking to European organisations. It is important to have an association for investors in the country, so we can discuss the things we want to do together at the national level, which could be followed by whether it's lobbying, deal syndication or education for investors as well as startups," Ciprian said.
Written by Pablo Munilla for the Early Stage Investing Launchpad