We started 3Si because the venture capital industry has grown too large to serve the needs of early stage entrepreneurs. We plan to change this paradigm by showing that being more selective and by working with fewer entrepreneurs, we can produce better outcomes. At 3Si, we have redesigned venture funding with the Founder as our customer. Everything we do is focused on enabling our Founders to realize their dreams.
Our normal investment size is between $50,000 to $2.5 million and we are almost always the first venture investor in a company. Our deals are simple and clean, with a large amount of our funds reserved for each company. This means that while our initial check sizes are small, we can still be a powerful financial partner for a growing and successful company.
3Si currently utilizes a $70 million venture fund focused on early growth stage investment opportunities. Leveraging the operating experience and investment background of 3Si's Partners, we are primarily focused on investing in the following:
Analytics and Big Data
Consumer Web & Social Media
Finance / Venture
Games and Entertainment
Software and IT Services
3Si is changing focus from being a startup stage capital provider to a growth stage venture capital fund that is actively investing $50 thousand to $2.5 million in companies throughout the US. (3Si will not entertain any foreign or international entities) Our fund will now focus on investing in revenue producing companies that have the potential for significant growth through a defined, catalytic event or milestone.
3Si is focused on funding small to mid-sized companies serving a niche that is undeserved. It is critical that the companies have validated the functionality of their product or service prior to taking on an investment from our fund.
3Si applies the below criteria and requirements in order to determine whether to consider a deal further:
US entity or corporation
B2B or B2C product or service that typically involves scalable technology with strong IP and/or barriers to entry.
12 month trailing revenue run rate in excess of $1 million (we do not fund startups or pre-revenue companies).
Plan to achieve positive cash flow within 6 to 12 months of the investment (if not already).
Total capital raise round of less than $8 million.
Reasonable valuation and structure.
If companies meet the above criteria, we will have an initial phone conversation, visit them at their facility, and/or ask them to present to us at our offices. These contacts are to determine:
Capability of management team.
Whether there is a defined catalyst for growth.
Appropriate use of funding.
Alignment of exit timing in the next 2 to 4 years.
If you are a company that exhibits the characteristics outlined above, or you have a referral, please contact us.
3Si follows a disciplined venture capital investment process, with particular attention to providing valuable services to potential investees including an unconventional combination of focus on speed, depth of due diligence, value-added input to management, and term sheet development that effectively mitigates downside risk while maximizing the potential for extraordinary returns.
A typical investment that comes into the 3Si process may come to term sheet negotiation within two to four weeks of the deal being sourced. Due diligence may be completed four to five weeks thereafter, with closing occurring after legal due diligence within two months of the initial contact. This efficiency allows the team to effectively consider a number of potentially lucrative investments simultaneously – typically, 3Si has 1-3 deals under due diligence at any one given time during the calendar year.
Deal Sourcing: Attorneys, Bankers, Investment Bankers and (Other) VC Firms
Preliminary Fit: Business Plan Evaluation, Management Evaluation and Preliminary Meetings
Review: Red Team Analysis (Pre-Mortem), Technology Analysis and Financial Analysis
Term Sheet Development: Risk Mitigation and Entrepreneur Fulfillment
Due Diligence: Site Visit, Management Interviews and Customer Interviews
Closing: Legal Documentation
Investment Monitoring: Board Participation and Continued Involvement / Oversight
Exit: Full Acquisition and Partial Acquisition