William Leonard
Founded in 2012, and based in Columbus, Ohio, Drive Capital is known as one of the premier investment firms focused on startups between the coasts. Today I’m joined by one of Drive’s newest General Managers, Avoilan Bingham. Avoilan has been a strong Atlanta advocate as you spend time investing with Vertical404. Working with Goodie Nation and even leading sales for an Atlanta Startup. In his role today, Avalon is looking to back technical founders at the earliest stages. Our conversation is wide-ranging and touches on topics like the hype around Generative AI, optimism regarding today’s venture markets, and why Drive Capital’s hyper-focused on investing in Atlanta. This was a fun conversation, and I want to give Avoilan a personal shout-out as well because he will be one of the VC judges at the 17th edition of Startup Runway this Thursday, happening at the Woodruff Art Center in Atlanta. Thanks again Avoilan. A quick note before today’s episode, I’d like to express how excited our team is for the Valor VC day Innovation Summit happening December 15th, this Thursday at the Woodruff Arts Center in Atlanta. We are bringing together LPs, our founders, and co-investor from the network to talk more about innovation and the opportunity that’s happening right here in Atlanta, in a broader southern region of the US. Happening in tandem with this summit is the 17th showcase of Startup Runway, where 10 underrepresented founders will take the stage to pitch to VC judges from firms like DriveCapital, Coinbase, Valor, and many others to win non-dilutive capital for their startup. It’s a big week for us and we’re excited to see many of our audience and listeners from the podcast present at this event. Now back to today’s episode. Let’s jump into today’s conversation. Avoilan, it’s so nice to have you on, man.
Avoilan Bingham
It’s a pleasure to be here. Thank you for having me.
William Leonard
I really want this conversation to be free-flowing and intuitive for our listeners. One, I want to say congrats on the new role with Drive Capital. Drive is a well-known and prominent venture firm so it’s good to see them establishing a presence here in Atlanta. Let’s kick this off with maybe a brief 3-second overview of Drive Capital and then I want you to segue into telling us more about the Avalon story.
Avoilan Bingham
Absolutely. Again, thanks for having me. Drive Capital, as you mentioned is one of the top firms in the country. Drive was started in 2012 by Mark Kvamme and Chris Olsen, two former Sequoia partners. They really wanted to focus on investing inside of the country, as opposed to the coasts which is where they came from, and really decided to focus on the Midwest. Both have Midwest roots and decided to start the office in Columbus, Ohio. Since then, has been wildly successful, with several very well-known exits throughout the industry, over almost two and a half billion dollars in assets under management, and a tremendous team. I’m super honored and humbled to be a part of Drive Capital and our story to continue to support and invest in founders to build where they’re strongest. Super excited about the opportunity that we have, especially in a market like Atlanta, to be able to invest in some really great early-stage companies.
William Leonard
I love it, man. We’re gonna dive a little bit more into the broader thesis here in a few minutes, but what’s your story, Avalon? How did you get into the world of VC and ultimately, connected with the team over at Drive?
Avoilan Bingham
Absolutely. I’m a native Atlantan. I feel like you and I are two of the few who could actually claim that. I’ve been involved in the local ecosystem for a while. My background really just going back even to college was radio and music. I was very involved in the music and hip-hop scene. While I was in school, when I graduated, really kind of leveraged that. I managed some artists, managed my cousins, managed friends who were young, up-and-coming rappers, producers, and entertainers. I stepped away from that in early 2010/2011 after my oldest daughter was born in 2012, and really focused more on management, but did a lot of retail management for a lot of local big-name companies here in Atlanta for about 10 years. 2018 was when I really wanted to kind of step away from that world and really do something a lot more entrepreneurial. I had an opportunity to work with a startup in town by the name of mymy music. With that particular startup, I helped them go to market and I helped them with investor relations. This was all new to me, I had no background in any of this, but it was an opportunity to kind of jump in, learn, and grow. That was something that I really wanted to do and a chance to kind of learn new skills. And so I did that, it really starts to expand my network here in Atlanta by working with them. I worked with them for about two years and in a variety of different capacities. Building relationships and building partnerships on the ground for mymy here in Atlanta. In the midst of that time, I became one of the founding 100 stakeholders at the Russell center and in June of 2019, I became a member of The Gathering Spot. Connecting with, again, a lot of great, great talent and great people in Atlanta. Top of 2020, I became a venture partner with Republic. Great opportunity, again, to source deals, really kind of played into the roles that I had with my background with mymy and investor relations role. That role with Republic was right before the pandemic, which of course, changed everything. Right after that, going into the summer, late spring, George Floyd was murdered. I know for myself, personally, as for a lot of us, that was a real inflection point on how am I using my platform to help people who look like us, especially in the world of VC and investing in startups where we know that black and diverse founders just don’t receive the same type of support, specifically from the capital and financial capital that other groups do. I knew there was something that I wanted to potentially really kind of wrap myself up in and get more involved in and had the opportunity to really think deeply about, okay, I want to do something in the venture because I see there’s an opportunity to make a change and I want to be a part of that. I really spent the whole summer of 2020 really diving deep into that. I was fortunate enough to connect with my good friend, Antoine Woods with Vertical 404, and join forces with him to build that particular firm. I worked with Antoine in that capacity for two years as a Managing Partner there to help find and be able to invest in black, Latinx, and female founders of B2B SaaS companies. Fast forward to this year, finally got to retail completely. A lot of the stuff I was doing, kind of like side hustles and an extra gig but finally got out of retail and was fortunate enough to connect with my good friend, Farah Allen, CEO of The Labs. She brought me on as Head of Sales at the top of the year, which was for me a life-changing experience to be able to do something in tech and get out of retail. I worked with her and connected with Joey Womack at the end of last year, but officially joined forces with Goodie Nation at the top of this year. I worked as a next-generation Portfolio Manager working with early-stage startups, not all based in Atlanta, but a lot of them are, but really great companies that are here in Atlanta that I work with and really overseeing a portfolio that can range from anywhere from 30 to 50 companies and really trying to help them with go to market fundraising strategies, just the whole nine, that type of advice, and type of support that early stage founders need. I did that and I’ve worked with the Georgia Microenterprise Network as a technical assistant. Again, helping small businesses throughout the state of Georgia with all the different needs that small businesses have. Throughout all of my different partnerships and relationships, really come back to how can I support founders. This opportunity with Drive came in late summer, I’d say September, had a connection to a mutual friend with Silicon Valley Bank, and they helped put us in contact. Since then, I’ve been on board since the top of November. Just super excited about the opportunity here in Atlanta to really work and build on what I’ve done as far as with my work with early-stage founders, specifically in this market, and more broadly throughout the southeast region.
William Leonard
You really are true to Atlanta, right? You were born and raised here, you grew up here, you built your career here, and built a foundation. You’ve been involved in so many levels in the city. We’re gonna dive into that a little bit later in the conversation to get your insights on how you’ve seen the city evolve as a whole, and not only Atlanta but really the region that you’ve been actively contributing to. You connected with Drive in late summer, and you’ve been on board since November timeframe. Tell us more about your role as a GM, what does your day-to-day look like? What types of companies are you looking at? Tell us more about that.
Avoilan Bingham
Absolutely. The type of companies that we’re looking for that is early stage, pre-seed stage companies. We’re looking for companies that are ideation. So you’re thinking about it, you’re putting some of the different ideas together. We’re looking for technical founders, if you’re not a technical founder, that’s not an automatic no, but that is something that we do tend to prefer. We’re looking for billion-dollar market opportunities, and not just a big total addressable market, but specifically, what is your business doing to drive sales to get to a billion dollars? What’s that pathway look like? Again, obviously, venture backable. Those are broadly what we look forward to, generally industry agnostic. We do look for themes within industries that are emerging. I’d say one of the top ones that we’ve had a lot of conversations about with our firm has been generative AI. I know we’re not the only firm that’s looked a lot into that but just the capabilities and the potential outcomes from generative AI in all sectors in all industries. It’s something that we’re really excited about. Something that’s in that space, we’re certainly interested in having a conversation around it.
William Leonard
That’s awesome. Generative AI is an incredibly hot space right now. We’re seeing a ton of use cases and I think you said you are more focused on the technology as a whole as opposed to a particular use case. That’s incredibly fascinating. You all are looking for pre-seed, ideation stage preference towards technical founders. Are you all making direct investments? Is it kind of like a venture studio model or is it more so just an investment model? How would you describe that?
Avoilan Bingham
It is an investment model and I’ll even expand upon the stage so we could start ideation. I’ve had conversations with founders who have a viable product, they’re in the market, they have some traction, have some customers, maybe it’s not consistent, but they do have that in place. We really look anywhere in the pre-seed stage is really where we’d be interested to get active, but I think for us, we write half a million dollar checks. We’re looking for about 5% equity in the companies that we work with. And, yes, it would be a direct investment, it wouldn’t be a venture studio model but ideally, we want to work with founders over a given period of time to ideally prepare them for that seed raise. That’s something we want to be very closely aligned with the founders and with the companies that we work with. We do, at some point, anticipate having office space here in Atlanta, and continuing to grow that relationship here. And again, really making sure that the founders who we invest in are Atlanta based. This is something that is really focused on Atlanta and it’s important that the founders who we work with if they’re not in Atlanta, they’re willing to come to Atlanta and be a part of it.
William Leonard
Got it. That’s one thing I really love. I was reading the announcement from Drive a couple of months back and I saw their DMs in other cities like Chicago and Atlanta which are hyper-focused on building an ecosystem and finding founders in a specific city. I really love that approach. You mentioned founders in the region should be focused on making Atlanta their headquarters or coming here to build, is that correct?
Avoilan Bingham
Absolutely. I mean, why not? Atlanta this is the best city I would argue for a startup to build in. You have the natural resources of all of our colleges and universities. I think I saw a stat, there are 59 to 60 colleges and universities in the Atlanta metro region. I would go about the Metro Atlanta Chamber’s definition of the region’s about 29-county region. If you look at all the breadth of talent that we have that’s graduating and undergrad, think about all the Fortune 500 companies that you have here, almost 30 in any Atlanta region, you have the innovation, you have the enterprise, and you have innovation coming from the college and universities, and then the startup scene. There are just so many tremendous startups who are dispersed around all of our really great innovation hubs, like the Russell center, The Gathering Spot, ATD, ATDC, and Tech Alpharetta. Just throughout the region, there’s just so much going on and so many places where our founders are building, this is a great place to be. Ideally, you’re here in Atlanta building alongside us as we continue to grow and expand what we’re doing in Atlanta and the type of support that we’re going to be offering for the founders that we work with.
William Leonard
Right? Why not Atlanta? It’s the commerce hub of the South and it’s only going to continue to grow. As you think about Drive and your role as a General Manager, you said, you all are writing 500k checks, looking for about 5% equity, and really working with founders at the pre-seed stage and helping them get to that next seed raise. Are there any other particular unique value adds that Drive is providing to the portfolio companies from a tangible aspect?
Avoilan Bingham
Absolutely. That’s something that I think we’re probably most proud of. One, we’ve been doing this for over a decade as a firm. We have the resources, partners, and relationships in multiple markets to help you grow and to scale. Even when what we’re doing specifically per market, we are bringing resources to early-stage founders, so the founders that we invest in will have resources and will be able to leverage those resources in a way that will help you to grow and to really build out your business. Whether that’s us having the office space, whether it is having relationships with different marketing firms, different legal, some things specific to Atlanta that we’ll be building out, that will help again, as you continue to grow out your business those are things that you may not necessarily find with other firms willing to invest. You may work with the firm that’s going to just write you a check and walk away and expect to return. We want to be in the trenches with you. That’s where my background comes in, working with founders on a daily basis, working on SaaS models, working on go-to-market, and working on investor relations, those are things that we can tangibly have conversations with and help guide you in the right direction. For us, it’s important to really establish and build those relationships and be able to create solutions for where you as a founder, may not even know that you have a blind spot or weakness or that it’s something you need to know. We are putting those things in place together for the founders that we’re investing, especially at the earliest stages, but I think our track record and what we’ve been able to accomplish should be able to let founders know, like, hey, Drive’s able to invest in you. We have the ability to continue to invest in the following rounds as you continue to grow.
William Leonard
I love that. The longevity of Drive’s success speaks to the Rolodex of value add that you all have. I love that perspective. You all are hyper-focused on this really early stage, right? If you’re on Twitter right now or reading any type of mediums about venture capital, you’ve seen a lot of doom and gloom. I want to get your perspective, Avoilan, is that a fair assessment of the market right now that capital isn’t flowing and deals aren’t getting done? What’s the real assessment that you see from a boots-on-the-ground investor at this early stage? Is there an opportunity or is capital drying up for the most part?
Avoilan Bingham
It’s a great question and I think there are a lot of different ways that you can look at it. If you look at just the stats and you look at the data, I reference a lot of different data points, you can reference Panoramic. They do a great job with their status of the southeast startups report and if you look at that report, the money is still flowing, especially in the southeast may be much more than on the coasts or other regions in the US. There is still a significant amount of deals happening. The deals that are happening are somewhat lower than they were in the last few quarters, but they’re still great valuations that are happening for founders in the southeast. There’s still money that is flowing. Just from the data itself, yes, it is happening. What I would say to counter that, though, because I talk to a lot of founders. I have conversations with founders all day, every day. They aren’t necessarily feeling it, especially with our diverse founders, our black founders, or female founders, founders from different minority groups who don’t feel that same amount of support. The statistics also back that up. There is a lot of investment that still can’t happen, continue to support our early-stage founders who we know if they don’t get that capital, we’re already in a macroeconomic climate where we are probably, if not already, in a recession. We know that there’s still a lot more work to do and a lot more capital that can be deployed. I think where we’re able to come in is that we do have a focus and we are committed to this fund. This isn’t going away. We do want to be active in deploying capital and we are active and have already started to write checks with founders at the earliest stages. We’re committed to it, we know that and this is an opportunity where you’ve seen not even founders, but you’ve seen teams in the past, whether it’s Uber or Airbnb, who have been able to grow and thrive in difficult economic times. This is a time to innovate. I just saw a report that DoorDash is laying off a bunch of folks. We’ve seen a lot of tech layoffs here over the last few months and what that’s only going to do is accelerate more innovation as folks get back to maybe creating their own business again. I do think there’s an opportunity for deals. I do think there’s an opportunity in Atlanta for investment, especially with early-stage VCs. There are a lot of them in Atlanta as well but we know just from a draft perspective that we are going to invest, we’re talking to as many founders as we can to really understand their solutions and how they think about solving problems. I don’t think that it’s all doom and gloom, but there definitely is some cause for concern.
William Leonard
I agree with that 100%. You mentioned the massive layoffs that are happening as of late and it’s highly unfortunate but also, I think, on the other side of that, there’s an opportunity, like you said, for a lot of these technically driven employees at big tech companies to now go out and build their own technology, software solutions, or they can join an early stage company, and really bring that perspective that they had from their former employer. There’s a lot of opportunity amongst the doom and gloom. I want to ask you, Avoilan, you’re interacting with a lot of founders and hearing a lot of pitches, what gets you excited about a pitch? What can kind of turn you off in a pitch? I think speaking with investors is the focal point of investing and a lot of founders have 30 minutes to get it right or to get it wrong. I would love to hear your perspective. What are some of the dos and don’ts of pitching an investor for the first time?
Avoilan Bingham
Great question. I think some of the dos is one, clearly being able to articulate what the problem is, what your solution is, and what the urgency is around solving your problem. Why your team is qualified to solve it, and then the market opportunity. I think a lot of times I’ll get on a call and sometimes maybe four or five of those are in there, maybe half. But I think if you can’t clearly articulate why there’s an urgency around the problem that you’re solving and why you’re the most qualified to solve it, I think that’s where you start to have gaps where, hey, maybe there’s not as much interest? I think, for us generally, I mean we’re writing a really big check and we’re investing at the earliest stages so it has to be a big opportunity. It can’t just be, hey, my total addressable market is $100 billion. Great, what is your plan? What is your business plan to get to a billion-dollar market valuation? What are you thinking about differently than your competitors? Really being very diligent on what your go-to-market strategy is sometimes you hear differently, “This is our business plan. This is how we plan to generate revenue.” How innovative is that? How realistic is that? Are you truly betting that and depending on the business model that you have, are you really able to actually go to market and find and acquire those customers? I think that is some of the things that founders have to really think about. A lot of times too, do you even need VC at this time? It may not necessarily be the best for your business at this time and giving people that feedback as well. I think those are some of the things I would look at as far as some of the conversations that I’ve had and feedback I have. I’m big on feedback. For any founder that talks to you, I try to get back to them as quickly as I can, as far as feedback and why it’s a pass. Again, there are great founders here, but some founders may not necessarily meet the criteria that we’re looking for. It doesn’t mean that it won’t work for another VC, or maybe another type of investment opportunity. But for us, we do have a list of things and it’s the things that I mentioned to you as far as what we look for in a potential investable company.
William Leonard
One thing I’d add for founders to focus on in their pitch is to talk about the quantitative value proposition for their investors and to talk about how your product is going to drive their P&L directly, whether increasing revenue or decreasing operating expenditure. Talk about that in your pitch, because that is what’s going to sell your product and how you’re impacting the bottom line of your customers. A lot of times in pitches, you hear founders kind of leave that out or gloss, but that is the focal point of a pitch I believe. All great insight here, Avoilan. I want to shift the conversation a bit. As you think about the Atlanta tech scene, you’re a native Atlantan, you’ve worked with startups here in town to build out go-to-market strategies, and you’ve been a long-standing contributor to the ecosystem, whether it’s through TechStars, the Russell center, Vertical 404. In 2022, today, what gets you excited about Atlanta’s tech scene, and what trends in maybe 2023 do you think will be most prominent here in our backyard?
Avoilan Bingham
I get excited about the collaboration, man. I think that’s what Atlanta does better than anybody is that we can collaborate with anybody across any sphere, any particular silo that we have. I’ve heard a lot that Atlanta siloed. I’ve experienced that to a certain degree but on the same token, there are a lot of folks who are willing to collaborate no matter whether you’re in the VC space, your startup, or your enterprise. There are city government organizations, there are a lot of opportunities to collaborate and you see that a lot in Atlanta in a way that you don’t necessarily see in other markets. That’s something that’s very unique here. I think that something that gets me excited is that there are opportunities, for people who are willing to talk, and who want to listen to new ideas. That’s something I’ve been privileged to have the opportunity to speak to a lot of people in the Atlanta ecosystem and continue to have those conversations about how we can work together to support each other. As far as technology, Atlanta is a FinTech town. This is a B2B SaaS town, a cyber town. I still get excited looking at some of those traditional investment profiles for Atlanta, but I get really excited looking at emerging tech. I get excited looking at Web3, Metaverse, and their capabilities and functionality of that. We spoke a little bit about generative AI and just what the possibilities are being able to give that type of information to a machine that is not going to act as just an assistant but as a companion, and what those implications and applications could be for all types of industries: health care and some of the innovation that we’re seeing post-COVID and that looks like with so many health systems here in Atlanta and surrounding areas. There’s tremendous opportunity in that space. Those are the things that I look at that gave me the most excitement. Really just looking at emerging technology as well, as a whole, as I mentioned, with the Web3. I know crypto obviously has been under a lot of scrutinies over the last several months and that’s going to continue to happen when you have what happened with FTX. I still think there’s a lot of potentials there, especially with new technologies that are here in Atlanta, but maybe have not traditionally been invested in. Those are the things that we’re looking for. I’m looking for something new. How do we solve old problems with new solutions? A lot of that is happening in Atlanta, just continuing to try to source and find those opportunities to invest in.
William Leonard
I really like that. I think Atlanta is really at an inflection point right now in its growth, where the many venture funds coming here, venture funds on the coast, allocating dollars, specifically to Atlanta. We think about all the university talent that is here, pairing that with the enterprises that are moving here, solidifying headquarters here, we’re at a growth point in the city. I think Atlanta is going to be a totally different, more mature town here over the next decade or so. I’m excited to see how the funds and the founders here in town continue to shape the city’s ecosystem. Avoilan, this was an incredible conversation. I enjoyed learning more about your background, Drive, and the impact that you all are looking to have on early-stage founders here in the city. How can a founder who’s maybe listening to this conversation get in touch with you or someone on the Drive team to pitch their company?
Avoilan Bingham
The best way is on LinkedIn. That’s one of the best ways to reach out to me. I would recommend reaching out to me on LinkedIn, just DM me or reach out to connect. We’d love to have a conversation and love to see demos or founders all throughout Atlanta, and even from other regions who may be interested in coming to Atlanta. That’s the best way to reach me. I’m also getting more active on Twitter. I’m at @avisrich on Twitter but you could find me on LinkedIn at Avoilan Bingham.
William Leonard
Awesome. Avoilan, thank you so much for joining me today, man. Looking forward to seeing you around town.
Avoilan Bingham
Absolutely. You too, man.
Lisa Calhoun
We’re thrilled to have you as an Atlanta Startup Podcast listener to help you get the most out of the experience. Let me invite you to three insider opportunities from our host Valor Ventures. First, want to be a guest on this amazing show. Reach out to our booking team at atlantastartuppodcast.com. Click on booking, It’s a no-brainer from there. Are you raising a seed round? Valor definitely wants to hear from you. Share your startup story at valor.vc/pitch. Are you a woman or minority-led startup valor sister program? The Startup Runway Foundation gives away grants to promising startups led by underrepresented founders. The mission of the Startup Runway Foundation is connecting underrepresented founders to their first investors. Startup runway finalists have raised over $40 million. See if you qualify for one of these amazing grants at startuprunway.org. You can also sign up for our next showcase for free there. Let me let you go today with a shout-out to Startup Runway presenting sponsor Cox Enterprises and to our founding partners, American Family Institute, Truist, Georgia Power, Avanta Ventures, and Innovators Legal. These great organizations make Startup Runway possible. Thanks for listening today and see you back next week.
