Connect is not your typical social media startup. It pulls data from all the major social networks and puts everything together in one place. The app makes it easy to see where your friends are in real time and connect with them. Here’s what the app looks like:
They currently have over 200,000 active users and are adding 7,000-plus per day. They’re on track to hit 300,000 users by the end of this year, but I expect them to do even better.
And Connect’s leadership is top-notch. I happen to know firsthand. I met Ryan Allis, Connect’s CEO, in Las Vegas back in 2007. At 24 years old, he was already the founder and CEO of iContact, an email marketing firm. He sold iContact for $169 million just a few years later.
I also know a senior executive at iContact who worked closely with Ryan for six years. She gave him a glowing review, calling him a visionary leader.
Strong leadership? Check.
The lead investor in this deal is another huge positive. Jason Calacanis is leading the round. Jason is a legend in the angel investing world. He invested in the first round of Uber (which is now worth around $10 billion) and he runs the wildly popular “LAUNCH” startup conference. He’s extremely well-connected in the social media space and will add plenty of value as an advisor.
Also investing in this round: Techstars’ Brad Feld, another huge name. Having such well known investors advising them will give Connect a big edge.
The Product
Using Connect is easy. Log in with Facebook on the web, or download the app, and you’re up and running.
It’s an extremely well-built product. Robust, fast and visually stunning. If you’re thinking of investing, give Connect a try here (it’s free).
The most likely “exit” scenario I see is a sale. If it continues to gain traction and users, a company like Google, Yahoo, Facebook or Microsoft is likely to snatch it up.
This is an exciting opportunity to invest in a tech startup with strong leadership, well-known investors and a great product. Their biggest competition, FourSquare, is dropping in popularity and lacks innovative features that Connect offers.
To invest in Connect, you’ll need to register with AngelList if you haven’t yet. You can do so here:
https://angel.co/register?source=earlyinvesting
Once you’re registered and signed in, go here:
https://angel.co/connect/fundraising
Click the blue “Invest” button and AngelList will walk you through the investment process.
Connect.com
Type: Convertible debt
Raising: $5,000,000
Valuation cap: $25,000,000
Discount: 20%
Deal summary: You are buying a convertible debt note, which will convert to shares on the next financing round with a 20% discount to the valuation at that time, at a maximum “cap” valuation of $25,000,000. If the company is valued at more than $25 million in its next round of financing, your shares will convert at a more favorable rate.
Good investing,
Adam Sharp
Startup Investor Portfolio
