As active early stage investors and directors of Launchpad Venture Group, we are asked frequently about how we track our portfolio of investments and how we stay on top of the financial performance of each company. When we say that we track them in detail, the next question is what data do we track for each investment we make? And, we are asked about how we track the overall performance of our total portfolio. Excel spreadsheets can help with this effort to a certain extent, but they quickly prove to be cumbersome and lacking as your portfolio grows. So, since leaving things unmanaged was not an option, we built Seraf to help us with organizing, tracking and analyzing our portfolio.
For Seraf to be useful, you need to get the basic data into it. Once you have the hang of what you need and where to find it, it is very easy to do. So early on we created simple guidelines for locating the key elements of data needed to track an angel portfolio. And since they are such a useful overview of how deals work and where key data resides, we thought it would be useful to share them in a broader context.
The story behind the development of these guides is an interesting aside. They actually existed before the Seraf product itself. Before setting out to write code and build an application, we sat down and listed out every single one of the possible key variables that might be used to determine the value of an early stage portfolio (e.g. price per share of stock, total shares purchased, etc.). In addition, we wanted to make sure we captured important dates that could impact the performance of the portfolio (e.g. Maturity Date for Convertible Notes, Expiration Date for Warrants, etc.). And, we looked into variables that could affect tax issues (e.g. date of purchase, date of sale, etc.).
In the end, we pulled together a list with dozens of key variables. These variables provided the framework around which the Seraf products are built. And for the ease of users and the reference of other investors, they are represented in a series of checklists to help investors understand:
What these variables mean,
Why they are important, and
Where to find them.
Although these checklists are designed to work with Seraf, they can be applied by anyone who is looking to track an early stage investment portfolio. If you are interested in learning more about deal terms, we recommend you read our post on how early stage deal terms can impact your returns for a more in depth look at key variables for early stage investors. You can also refer to our guides on Convertible Debt and Preferred Stock Deals and our eBook on Early Stage Deal Terms.