By Jan Debets
Hi Sona, so how did you become involved in Angel investing?
Hi dear Jan, I was involved in a smart city startup in a business development role. As it goes with startups, we encountered a lot of problems. A classic startup story. After 2 years the project was on hold. There were a lot of issues with the AI technology. However, we did not feel we failed. We learned a lot!
I also worked a lot with investors. Along the way, I learned about various funding institutions and schemes.
I already knew the founders of BANA back in 2018, when we shared ideas on how to improve the ecosystem. This is how I got started.
What was one of those ideas that you brought to the table?
It was all about building infrastructure in the ecosystem, making a platform where investors and startups could meet regularly, engaging with investors who have different industry backgrounds, to give them opportunity to support a wide variety of startups.
2 years ago angel investing was still a new thing in Armenia. Not anymore. I am proud that we were the driving force in developing angel investment culture in Armenia.
How did BANA grow this quickly within 3 years?
Really, the changes are happening so quickly.
There have been several paths of growth. First of all, the awareness of angel investing itself grew. We worked hard to communicate the opportunities of angel investing through events and social media. Community is more aware about it now.
As a network, we were working on engaging relevant people, and increasing the number of members with potential to add great value.
Being a pioneer always means that this will be challenging. So, whether they are Diaspora Armenians with tech background, local investors from traditional industries or non-Armenian investors, we place high importance on what value they bring to the table. Can proudly state we have a well-established network that covers wide range of industries and geographies.
Secondly, we work closely with startups from early stages and contribute to their growth. We are active in the ecosystem and run a business incubator, this gives us early access to the best dealflow.
What other elements you found important?
Our growth in Armenia is mainly based on our technical talent. Beginning in primary/middle school, young people have the opportunity to get involved in various programmes on engineering and robotics. This provides the tech sector with great talent.
We do not have big funding institutions yet in Armenia.
In the last 10 years there has been a big buzz about tech in Armenia and we have many successful companies as well as exits of Armenian tech companies to multinational ones. BANA gave investors access to this ecosystem that they didn’t have before.
What measures is the Armenian government taking?
The government is proactive in supporting tech entrepreneurship with attractive tax incentives (0% income tax, 10% flat payroll tax). Also, government is setting up a national investment fund that will possibly co-invest with angels.
In what way do Armenian startups view Europe as a market?
Overall, Armenian startups mainly view Europe and U.S. as their main markets. The thing is, although a lot of startups want to access different European markets, most of them want to scale up in the U.S. first. Entering European market means developing different strategies and structures for each country, whereas entering the U.S. gives them access to a large market at once. We also have a sizable Armenian diaspora in the U.S. that makes it easier to develop connections and set up operations.
What struck you in particular working with Armenian angel investors over the last 2 years?
We all know that team is the most important thing in the startup. The unique characteristic of our angels is that they want to do a deep due diligence of the team not only professionally but also personally.
What kind of issues do you face in building your angel network?
I would say having enough lead investors is the biggest issue. Even though we have a decent amount of investors, they do not necessarily want to take the lead.
We try to improve this by organizing various types of training and experience sharing activities in addition to putting them in the atmosphere of startups and getting them comfortable with the founders.
For instance, at our incubator program we have biweekly monitoring days, where startups pitch, explain what they have done in the past weeks and what their plans are for the upcoming ones. We invite investors to those sessions, ask investors to give feedback and advise the startups. These are the important first steps for new investors to get familiar with entrepreneurs and their projects.
Which areas/industries does your ecosystem excel in?
I believe we have good software startups from all areas, along with a few hardware ones. Recently, AI based startups are booming in the country, and B2B is turning into a more preferable sector.
Finally, which of your startups in your portfolio is ready to scale in Europe (which one would you like to put in the spotlight)?
I would name three startups that are ready to rock Europe:
Lucky Carrot - Peer to peer recognition and reward system.
EasyDMARC - All-In-1 solution for securing domain and email infrastructure. Their tools help to identify existing problems easily and configure your domain correctly in order to protect the business from phishing (email spoofing) attacks and increase email deliverability.
Podcastle AI - Podcastle converts text news/articles to a podcast, with very natural human speech using machine learning.