ANTHONY GELLERT ‒ NYA MEMBER SPOTLIGHT
Anthony Gellert joined New York Angels almost 10 years ago with a wealth of expertise in public market equity and startups. As the Founder of Livingston Capital, Anthony is extremely involved in the New York early-stage ecosystem through investing, mentorship, and pro bono consulting. Anthony shares why he would never recommend investing in a startup alone, why potential angel investors have to be serious about allocating capital, and how founders should leverage their cap table for introductions.
How did you first meet New York Angels, and why did you decide to join?
I first joined the Harvard Business School Angels of Greater New York as an alumnus. As I became more interested in the asset class, I asked my network about what other groups are highly respected in early-stage investing. New York Angels was always on the top of list.
What has been your most memorable experience as a New York Angel?
Exits. It’s always nice to get a big check in the mail.
What do you look for when you are investing in a company?
I look for some consensus among the group. I invest through New York Angels because no matter what company or sector is pitching, there is somebody in the room with expertise in that sector. The collective expertise of NYA’s 130+ members is a huge benefit when it comes to investing in startups. I would never invest in a startup alone.
What do founders appreciate most about working with you?
I support them beyond investment, including in their operations and through serving as a board observer for some startups. I also further invest as they do well. If they’ve impressed me (and us at New York Angels), I reserve capital to add to my investment, so they know there’s a goal to work towards.
What differentiates companies that you see at Screening versus those who make it through to Due Diligence?
You may receive an invite to pitch at Screening if you have a clever idea, but you make it into Due Diligence if it is clear you are also a business and not just a dream.
What advice would you give founders starting to fundraise?
First, tighten up your pitch. The pitch is the first thing utter strangers will judge you by. No matter how passionate you are, you will fail if your pitch is all over the place. The pitch makes a difference: I have seen a lot of lousy pitches, and I have seen a lot of great pitches.
Second, work with angels. Yes, it can be annoying to have 6 or 7 small checks on the cap table, but angels often have connections and can make introductions. They are not just there to give advice, which can be too much sometimes, and young founders sometimes do not listen anyways. Angels have a great Rolodex, so you should leverage your cap table for introductions.
What advice would you give to early-stage investors who are considering joining New York Angels?
Be serious about allocating capital to this asset class. If you are just coming to be a tourist and to sit in the back and watch a live version of Shark Tank, NYA is not right for you. The strength of New York Angels is that we are known to be investors, not just listeners.
Second, I want to give you some hope. There is a lot of negative press about VCs, crowded asset classes, and scarce IPOs, but at the early-stage NYA invests in, we can exit without the need for an IPO. We can sell to a strategic or to other VCs who want to clean up the cap table. We have many more shots on goal than later-stage VCs relying on an IPO or a large strategic acquisition.
When you look at your past investments, what do you think is most critical for founders to deliver a successful exit?
Early-stage companies have to last. There will be bumps in the road, which is why NYA is tough on valuation. You might think your company is worth $15 million because you have made progress and the idea seems better than the $5 million companies out there, but there will be down rounds, emergency raises, and pivots. If you have the grit to make it through all of that, you have a chance. If you think it will be smooth sailing and you ask for a large valuation on Day 1 because it is predetermined in your mind, you are probably not a fit for New York Angels, and it will be hard to succeed.
What is something interesting about you that has been helpful in your career?
I am an entrepreneur myself. I started a fund over 25 years ago, and I know there are bumps in the road. I know how asking for money is the hardest thing in the world because we are taught not to do it, but you have to do it. I raised a VC fund 10 years ago as I started investing through angel groups. I understand firsthand how hard it is to be an entrepreneur: how desperate you are every day, even on Sunday nights, even when you are spending time with your family. You are completely consumed in thinking about raising money, running out of money, pivoting strategies, and finding clients. As an entrepreneur, this helps me empathize as an investor.
Is it better to invest through an angel group or individually?
I encourage people to join their local angel group, whether that is in New York or another city. Most large cities have a large, established angel group. Investing in a startup without help is a fool’s errand and a great way to lose money. I am also part of a family office, and we don’t invest in startups because we do not have resources to vet them. Too often, family offices rush into deals because they are excited and throw money at a startup without proper due diligence, only to see their investment becoming a waste of money.
