Emanuel (“Manny”) Zareh responds to the common queries he receives from the founders of startups who are seeking investments from Emles Venture Partners.
What is the history of the firm?
Emles Venture Partners was established by Gabriel Hammond, who began his career at Goldman Sachs as an analyst. At the age of 24, he left Goldman and started two investment management companies. He grew those businesses, and at their peak they had $33 billion in assets under management. He eventually sold those companies and used part of the proceeds to form Emles Venture Partners, which is dedicated to promoting entrepreneurism.
I started off my career at Morgan Stanley as an investment banker, and I also worked for the National Football League with the executive management team. From there, I enrolled at Harvard Business School. After graduating, I worked for hedge funds, where I invested across the capital structure, in both public and private companies. In 2012 and 2013, the New York tech scene really started to develop. I became immersed in it and thoroughly enjoyed it. I started doing my own personal investing and served as a consultant to a number of startups. A few years ago, I met Gabriel and learned about the vision he had for Emles Venture Partners. I joined Emles in August of 2019, and now I am a partner with Gabriel at the firm, sourcing deals and managing the day-to-day operations of the business.
Do you have a particular sector focus or any geographic constraints?
We are sector agnostic and do not have any constraints geographically. We have made investments and are interested in a full range of sectors, everything from technology and biotech to the cannabis industry. There are certain themes our investments tend to focus on. These include diversity, sustainability and accessibility, and we are finding companies that embrace these principles across a full spectrum of industries. On the diversity front, we are very interested in supporting diverse founders and those from regions that typically do not receive a lot of interest from venture capital firms.
We are willing to go anywhere there are opportunities. That makes us much more agile than the venture capital firms who have a geographic focus. There are also no limitations on the amounts we will invest in a particular region, so founders do not have to worry that we might limit the check size based on where they are.
We will invest in Frontier Economies. We do not have any constraints to deter us. We have made investments in Pakistan and Venezuela, for example, because we believe in the founders we’ve partnered with and the opportunity they are pursuing. We also think many investors misperceive the risks present in these markets. Founders are routinely pleasantly surprised with how different we are and how open we are to opportunities, wherever they originate.
If you have already invested in the space I operate in, would you consider making another investment in that market?
The simple answer to that question is yes. We are very interested in the creator economy, for example. One of our investments has an opportunity to benefit from the rapid growth in e-sports, and we are still listening to pitches from founders who see opportunities to serve that market. We are always willing to hear about opportunities in any market, and do not consider multiple investments in a market redundant.
Are you only equity investors or do you also offer venture debt?
We do offer venture debt, as well. Rachel Deinhart is our in-house specialist who analyzes all our venture debt deals. These are a quarter of our offering, and a significant differentiation for our firm. We are determined to help the companies we invest in succeed, and we want our founders to keep as much of their company as is possible. Venture debt is an elegant and potentially attractive source of capital for our founders, and we are always open to discussing that type of investment.
We also offer bridge SAFEs as an investment option for founders. Access to capital in advance of a Series A provides founders with a less dilutive alternative. At a significant discount to a Series A, bridge SAFEs help founders maintain their momentum and retain a greater share of the company for themselves, allowing for higher valuation in larger upcoming priced rounds.
What is the source of the capital that Emles invests?
We are investing our own capital. Essentially that means we put our money where our mouth is. The benefit for founders is that this enables us to be very patient. We’re not managing to a particular fund life, so founders won’t experience extreme pressure from us to keep showing progress in their quarterly numbers or to achieve a specified valuation by a set time so we can sell our interests back to them.
We take a long-term view and understand it takes time to grow a successful business. That understanding comes from the fact that key members of our team have all founded our own companies. Gabriel has. I have, and so too has another one of our partners, Dave Saxena. Founders can count on us to have a long-term view for their business.
What do you consider when assessing a founder and their business?
Our top priority is to work with founders who demonstrate passion, audacity, and resilience. Read more about what we look for here.
What does the decision-making process look like?
You can count on our process to be both thorough and fast. You and your team will be treated with the full respect and consideration you deserve. Find more details about our due diligence process here.
What opportunities for partnership does Emles offer? Will you be able to introduce us to potential customers in our space and influencers? How can Emles help us promote our firm and get the word out?
We work as close partners to all the companies we’ve invested in. Our network is deep and diverse, given all the sectors we have invested in and worked in. We have relationships with industry influencers, including Y Combinator, Female Founders Alliance and Morgan Stanley’s Multi-Cultural Innovation Lab. Gabriel even established a movie production company during the course of his career. His network includes people in the entertainment industry and key influencers from that world.
We often promote our founders and their companies – through photoshoots, inclusion on our website and marketing materials, and dedicated blog features. We will help amplify company news through our social media and web platforms – and are happy to provide insight and support on how our portfolio companies can effectively promote their businesses via their marketing efforts.