Investing at Notre Dame Venture Capital with Alan Gordon

An interview with Alan Gordon regarding his experience investing at Notre Dame Venture Capital, a student-led fund.
February 18, 2024
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Background

Alan Gordon is a business analytics major at the University of Notre Dame. He is the Co-Managing Director of Notre Dame Venture Capital (NDVC). NDVC is the university’s student-led venture capital firm. I talked with Alan about what they are looking for when investing, how they support startups, and how to join the internal team.

Highlights

  • NDVC mainly invests in Notre Dame-affiliated startups, given that it is their network, but they can invest in any startup regardless of affiliation.

  • NDVC typically invests between $5,000 and $10,000 but can increase their check size when investing in follow-on rounds. Investments include Matter, Fireside, and Ritual.

  • NDVC’s value add is connections to the Notre Dame ecosystem. They have been able to place students at startups in their portfolio and can connect you to other Notre Dame alums who can invest larger sums in your round.

Interview Transcription

Kieran: Thanks, Alan, for joining me today. Do you want to introduce yourself?

Alan: Of course. I’m Alan Gordon. I’m a business analytics major at the University of Notre Dame and originally from Dublin, Ireland. This year, I’m running our student investment fund. We invest in seed and series A startups.

Kieran: How did you first learn about Notre Dame Venture Capital?

Alan: As a freshman, I worked on my startup. It was a health tech play. It grew to eight students, and it was really through that I first became interested in venture capital. I met a couple of investors for my project, not so much for funding but more for advice. I got interested in that side – investing and advising startups. I interned at Battery Ventures for ~10 months in my sophomore year and absolutely loved it. I did everything from souring to diligence. It was a great experience. During that year, I also heard about Notre Dame Venture Capital through the club leader that year, one of my friends. So, that’s why I got involved. I became a project team member. Then, due to my experience on the project team and at Battery Ventures, it made sense for me to step into a leadership role this year alongside my co-leader, Tony.

Kieran: Can you share some background information on the fund? How large is the fund, what’s your typical investment size, etc.?

Alan: Notre Dame Venture Capital is the university’s student-run venture capital fund. It has two main goals. The first one is on the education side. Any student of any major can join the club if they’re interested in learning more about venture capital. We’ll do weekly guest speaker presentations and workshops. The goal is to upskill all our members to prepare them for internships and full-time jobs. The other side of it is the investment side. So, we have a small portion of the university endowment we can invest out of. Typically, we invest between $5,000 and $10,000 in any one company. The catch is that we can increase that in follow-on rounds depending on the valuation. We’ve gone up to $50,000 as a max investment.

Kieran: How frequently are you investing?

Alan: This semester, we’re looking at five investments. We’ve done three already.

Kieran: Are you only allowed to invest in Notre Dame-affiliated startups?

Alan: We can invest in anybody. That being said, since we’re affiliated with the university, many of our deals come from ND alumni. Therefore, most of our investments are in Notre Dame-affiliated startups.

Kieran: What are you looking for in startups before investing?

Alan: We’re very generalist in terms of industries. We’ve done industry reports on everything from open banking, generative AI, gig economy on the software side to renewables, transportation, and housing on the more physical side. So, we’re very open to anything. 

Kieran: What does the NDVC investment process look like? How do investments get done?

Alan: There are two ways. We have ten project teams, each consisting of 5 students with a student leader. They work closely with an alum at a top firm in VC. So, the project teams’ goal is to pick out an industry with their VC partner and do a deep dive into it. They’ll put together an industry report. Afterward, they’ll start sourcing startups and compile 20-25 exciting companies in that industry once they know the background. From there, they’ll diligence each company and narrow it down to 5-6 companies. Then, they’ll do further diligence and narrow it down to 1-2 companies to do investment memos on at the end of the semester. Then, hopefully, we’ll do the deal. The second way is warm introductions. We have a lot of Notre Dame investors and founders. So we’ll get deals often through them. The difference with those is that we can be a little more confident with the startup’s quality and fast-track their diligence. For example, I just got one about an hour ago. It’s an ed-tech startup that came in through a connection, and they are raising a new seed round. For that one, we can bring the deal to one of our project leaders and ask them to diligence it within 2-3 weeks. 

Kieran: What would you say is NDVC’s value add to startups in its portfolio?

Alan: Yeah, that’s a great question. We know our check size is tiny, especially in the current environment where a seed round may be upwards of $5 million. Our value add, and we try to make this clear when we invest in companies, is if you take our investment, it opens up the entire Notre Dame network. So, one of the big things we’re doing as a club is engaging all our alums, founders, and investors. We have a Slack and a Google Drive ecosystem with 1,800+ people. If you take our check, we’re delighted to introduce you to people in our network for hiring and further investment opportunities. Making connections all over the place is our fundamental value add.

Kieran: I’m curious about the diligence process. It seems like you do a lot of research beforehand. Do you speak with the founder during that process to get more information on the company before investing, or are you making decisions based on the public information you can find, plus data points from other investors and founders?

Alan: All of the above, so whenever we can, we’ll speak with the founder multiple times if possible. Since we have warm introductions a lot of the time, it usually works out that founders are pretty open to talking to us, which is excellent both from our point of view, and we also have a lot of students who can deliver great advice, so it works both ways. Then, in terms of the ordinary stuff that VCs go through, market size, competitors, all of that kind of stuff as well. We try to do as much as possible on both the founder and the paper sides.

Kieran: What do you see as the biggest opportunities to improve NDVC in terms of how you support founders? 

Alan: One of our big goals for this year is to bridge the gap between the VC and entrepreneurial communities on campus. From what I’ve seen in my first and second years, the communities are slightly split. There is no rift; they just don’t engage that much together. One of the nice things about my co-leader, Tony, and I is that we both did a lot of work at the IDEA Center, the university entrepreneurship center. So, that’s our background. We bring that to the VC club. We already know everybody at the entrepreneurship center. So, we can try to bridge that. Just this year, we made our first student investment. That is something we’re pushing as well – to support the student entrepreneur on campus with capital. We’re also setting up internships for student startups to help them grow.

– now, let’s transition to questions to help students who want to join the NDVC internal team –

Kieran: Is there an application process to join this club, or is it open?

Alan: We’re happy to be open to anybody. We have weekly meetings. You can find out about meetings through our email list. We have about 2,000 students, roughly 25% of the campus, on our email list. You can turn up to any of our meetings. We’ll have awesome guest speakers weekly; learning from them is great. For our first-year students, especially those not going for a project team application, just being an active member is a good way to develop basic skills. Going one step further, we have our project teams. We have 10 of them this year, each with 5-6 students. That’s application-based, and for context, we have 60 students on project times, and we’ll get 100+ applications. So, we’re working on new projects to get more people involved.

Kieran: What have you historically looked at when selecting people for project teams? 

Alan: It’s interesting because we know many of our students are first- and second-year students. Many have not had a chance to intern in the industry, and it’s notoriously hard to break into. So, we have to be open to other experiences. Some of the questions we’ll ask are as follows: Is there a certain industry you’re interested in now and why? That will give us a sense of what spaces our project teams should be looking at and where the best fits will be for students. We’ll also ask more general questions about why they are interested in tech and if they have any experience. We try to filter for interest in tech and startups more than venture capital.

Kieran: Who are some of the industry partners you work with on the project teams?

Alan: This semester, the big names include Andreessen Horowitz, Bessemer, and 20VC. So, the ten project teams each have a firm like the ones I mentioned. Historically, they have all been venture capitalists. That being said, we’re working on a founder team next semester, and a Notre Dame alum who co-founded a startup worth over $1 billion showed interest in leading a project team. So, we’re working hard to set that up for the entrepreneurial-type students we’re trying to attract to the club.

Kieran: What does the commitment look like for the industry partners?

Alan: We leave it up to them. We only require a kickoff meeting with the entire team where you introduce yourself, the firm, and the industry you want the team to focus on. The other thing is at the very end, the team will present the investment memo. We expect the industry partner to share what they liked and where they could improve, and try to help them for next time. Between those two things, it’s up to the VC to decide how much they want to be involved. I would say that because our industry partners for the ten projects teams are all ND alumni and interested in the club, most are very active — some every week or twice a month.

Kieran: Is there anything I didn’t ask about that is important to know if you’re considering NDVC as a founder or someone who wants to join the internal team?

Alan: For founders considering taking capital from us, we are happy to introduce you to students as interns to help you grow. For example, in one of our most recent investments, a company called in-person donations, we’ve already placed a few students at that company to help with marketing, sales, and market research. Aside from us connecting with further investors, we’re pretty good at trying to help you build a team, especially if you need more hands-on experience on the job. On the internal team side, we’re trying to push to get more students involved than just the business students. Historically, venture capital is known as a business and finance industry. There tend to be a lot of business school students who join our club. We’re trying to move away from that and are looking at a lot more engineering students. That’s key to understanding the tech, and we’re open to any major. I think we’ve improved that by 20% this year, which is a good start, and trying to improve it more. The last thing I’ll share is a couple of investments that may be interesting for some of the listeners. One of the ones we’re proud of recently is called Fireside. Mark Cuban from Shark Tank is a co-founder. That was a big deal for us to get involved in. They have gone on to raise further rounds, which we were able to be involved in. That’s our biggest name so far, but we’ve also had our first acquisition and student investment in the last year or two.