Inside the Mind of A Portland Angel Investor

Venture capitalist Eric Rosenfeld talks about our start-up scene, where the money is coming from, and how Portland can cash in even more.

By Marty Patail January 5, 2015 Published in the January 2015 issue of Portland Monthly

Image: Michael Novak

How do you decide where to invest? At Oregon Angel Fund, we look for people who are the best in the world at what they do, regardless of the sector—and they need to be located here. About 70 percent of our investments are in technology and technical innovation. Another 20 percent are medical devices, health care IT, and related fields. And another 10 percent are just random. For example, we are involved with SeaPort airlines, which has gone national, and Green Zebra grocery.

Does the Silicon Forest compare to Silicon Valley? We see a lot of first-time entrepreneurs here. In Silicon Valley, we would see serial entrepreneurs. Some of our most successful investments are with first-timers. They don’t know what’s possible, and we don’t tell them otherwise. We just egg them on. We also see companies solving niche problems. That is appropriate for an Oregon startup. That is where we can excel. They aren’t going to take on Google or Facebook directly, which is very expensive and risky. We see start-ups applying technology to industries that haven’t benefited from that technology before.

We do have a national profile as a great place for young, tech-savvy, creative kids to work. And so we do see more venture funds calling us, asking for introductions. But venture funding for start-ups in Oregon is really, really small. We are the largest local investor, and we only invest about $10 million per year. That’s kind of sad.

How do we get more of that sweet moolah? Once a company proves itself, it can attract investors from all over the world. But in the earliest stages, where capital is still pretty scarce, seed capital (like what we’re doing) tends to be a local sport. Cities jump to the next level when wealth is created locally and reinvested. In Seattle, there have been a lot of nice exits, and you see companies going public every year. Some of those individuals invariably start venture funds. We just need more exits to get that cycle going.

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