Kevin Moore, Aaron Webster, and Justin Wilson talk about their history in Pivoting to Venture Capital in this article I wrote for the Oklahoma Venture Forum to promote a panel discussion with them.
Before having a career in venture capital, Kevin Moore, Aaron Webster, and Justin Wilson were pursuing other paths. Moore got a degree in engineering, Webster was a developer, and Wilson studied to be a doctor. While their career path changed, they incorporated their past knowledge into their current venture firms.
Spur Capital Partners specializes in early-stage technology and life science venture capital fund investments. Cameron Ventures is an early-stage venture fund with affiliate operating companies that serve customers across the United States, primarily in insurance, banking, and asset management. Wilson at Plains Ventures says they are sector agnostic, investing from seed to Series A in Oklahoma businesses.
Moore, a partner at Spur Capital, finds their significant diversification a positive for the company.
“The way that our model is set up, we invest in so many different companies with the right firms that we see these effects within the portfolio, where because we’re still investing at the early stages of a company’s life, we’ll see that maybe 20% of all the companies within our portfolio, they will drive about 75% of our performance,” said Kevin Moore. “That’s the power law effect you want to see in venture capital.”
Moore explained that the drawback to Spur’s business model is that some people lose all control. They decide which managers to choose, how much money to invest with each manager, and when to exit those different opportunities. The other potential issue that some people might have is that they only focus on early-stage venture capital.
Webster, Managing Director at Cameron Ventures, sees a benefit to their limited partner base.
“We get to focus on meeting entrepreneurs to focus on looking at the deal mechanics, looking at what the technologies actually do, and then backing the teams that we think are going to make some big changes in the industry,” said Aaron Webster.
Historically, Wilson, Managing Director at Plains Venture Partners, has focused on healthcare and biotech companies because Oklahoma produces outstanding companies in those fields.
“We can invest in really any industry as long as it’s a high growth opportunity with an outstanding founder, and there’s a clear path to value creation and an exit,” said Justin Wilson. “We’re open-minded and willing to dive in and understand something.”
For founders looking for investors, Moore thinks most founders discount the strength of their team.
“I think the team is critical,” said Moore. “However, I think that there’s also this notion that if the product is good enough or the market is large enough… And those things certainly have to be there, but in some of the most successful venture capital firms, what they experience and what I’ve experienced in the past is that the team is what makes the biggest difference. And you look at it as you can have a really good team with an average product that will have a higher probability of success than a great product with an average team.”
Webster advised that entrepreneurs should understand what type of fund they’re pitching to, whether generalist or vertical-specific funds.
“In general funds, you have to find the right partner to pitch to that is interested in your company and interested in your theme,” said Webster. “If you’re pitching to a vertical-specific fund, you actually have to pick the correct vertical. I get so many inbounds from founders, just cold decks to where we are not even focused in on that theme at all.”
Wilson said founders should view investors as a class of your customers.
“Think of investors as a customer and anticipate their needs and know that if you’re pitching a family office or a high net worth individual, what their needs are is likely very different than what a pure financial VC is looking for,” said Wilson. “But in the end, VC’s about value creation. And so if you can communicate that, ‘Listen, I have this really cool idea that creates real value, that solves a real problem for my customers,’ investors are going to find a way to understand it.”
Kevin Moore, Aaron Webster, and Justin Wilson will be part of a special panel discussion at the Oklahoma Venture Forum Power Lunch on Wednesday, April 13, 2022. The event will be open to members and guests both in-person and virtually via ZOOM.
“I think the fact that this organization exists is a huge positive for Oklahoma and for Oklahoma entrepreneurs,” said Moore. “It provides a good platform for people to present their ideas. And I would say that maybe most of the people in this group probably have some awareness of risk capital and what it means and how it should work. But I certainly encourage members of this group and just Oklahomans, in general, to think about venture capital and early-stage funding as an asset class and to make room for that in your investment appropriation.”