Press: The Hindu - Indian Entrepreneurialism
“The world is transitioning from the Industrial Era that we have grown up in, into the Fifth Era of digital and biotechnology disruption and change. Most people are not sure how to participate,” says Matthew C Le Merle, a Silicon Valley insider, Managing Partner of Keiretsu Capital, an affiliate of the US-headquartered global angel investor network Keiretsu Forum. Matthew and another Silicon Valley insider Alison Davis in their book Build your fortune in the Fifth Era: How to prosper in an age of unprecedented innovation, say the wealth being built in the transition to the Fifth Era is being captured in the early stages of business formation. Entrepreneurs are changing the world and angels perch on their shoulders.
Webinar: Singularity.FM with Fifth Era
SIngularity Blog webinar with Matthew on disruption, the Fifth Era, investing strategies and other topics.
Predictions For The Digital Economy in 2025
Presentation: Participating in our Digital Future
Click here to see the slideshow presented at the GooglePlex YPO day with Google Launchpad, Keiretsu Capital and Google X.
Press: SG Advisors Spotlight on Investing in China & Hong Kong
China, on track to be fully merged with Hong Kong in 2047, is poised to overtake the U.S. as the globe’s largest economy. Or is it? Investors who want to explore this as an investment opportunity need to understand not just the Chinese economy, but the market mechanics of China and Hong Kong and what type of access they offer. As China travels the road to world leader status we examine whether investors are welcome to join in the journey. The Chinese and Hong Kong governments are significant owners in most Chinese and Hong Kong stocks. Those that partner with these governments by owning stocks of companies based in China and Hong Kong should expect a bumpy ride impacted by politics, currency risk, and a changing investment landscape.
Press: Angel-Investor Funds Profiled in SF Business Times
Research: Do early-stage investors really enjoy rates of return three times better than public markets?
Do early-stage investors really enjoy rates of return three times better than public markets?
How much money do angel investors make investing in early-stage companies? Is it a genuine “asset class” with generally predictable returns, or just a potentially expensive hobby?
When Upstate Carolina Angel Network (UCAN) investors in Greenville and South Carolina Angel Network (SCAN) investors across South Carolina invest in a startup company, we have a specific return goal: to make a 50 percent or better annualized internal rate of return (IRR), which translates to 10 times our investment in five years (or four times in three years, etc.). We know that early-stage investing is highly risky: Startups often fail and take their investors’ capital with them. Factoring in the inevitable losses, we target a “portfolio return” of 20 percent IRR.
This compares to the annualized return (including dividends) of the S&P 500 over the last 15 years of around 7 percent. Do angels really enjoy rates of return three times better than public markets?
When you read about the fortunes of early private investors in Twitter or Uber, or founders like Mark Zuckerberg and Elon Musk, you see that sometimes they do. But those cases are news precisely because they are atypical. So what returns do “regular” angel investors expect, and what do they actually achieve?
Matthew Le Merle’s study, “Capturing the Expected Returns of Angel Investors in Groups,” released last December, answers the first question. From surveys of angel groups, Le Merle found that 55 percent of investors expect returns above 20 percent IRR, and the rest expect 10 to 20 percent IRR – better than public markets on average. This resonates with surveys of our members that show they are targeting returns of 20 percent or more IRR.
Press: Best Practices for India's Angels
There are best practices that differentiate between the most and the least successful investors: Matthew Le Merle of Keiretsu Capital
Keiretsu Capital is an affiliate of Keiretsu Forum, a leading global angel network headquartered in the US. The Keiretsu Forum has three chapters in India – Chennai, Bengaluru and Mumbai – helping Indian angel investors invest in start-ups in the US and in India. Keiretsu Capital has about $10 million under management, which it hopes to go up to $20 million by the year-end. In this recent interview, Matthew Le Merle, Managing Partner, Keiretsu Capital, talks of angel investing and the opportunities for India.
Press: Regulation is seriously harming investment in SA’s online startups
Regulating the internet in South Africa could have serious consequences for investment in the country, potentially damaging its prospects for growth.
That’s according to a new report from investment advisory firm Fifth Era.
As the report notes, internet businesses require capital to fuel their growth, and that capital comes both from local in-country investors, as well as from international investors in the form of FDI.
Thing is, those investors are almost always put off by ambiguous regulatory environments.
That’s a stark warning for South Africa, where legislators are trying to introduce a raft of new online regulations, ranging from cybercrime to taxation and copyright, but which is struggling with low levels of growth.
According to Fifth Era researcher Matthew C. Le Merle, most governments understand how important a driver of investment the internet is and have robust innovation policies in place, those policies are often at odds with the regulatory frameworks they put in place.
And when those regulations are too tight, investors tend to look elsewhere, as will the innovators and entrepreneurs they’re looking to court.
“The notion of an innovation-based strategy always collapses down to the fact that we need entrepreneurs and venture capital and both are scarce,” Le Merle comments. Entrepreneurs have a choice of whether or not to build a business, and where to build a business. If you make it difficult for entrepreneurs to do business in your country they will choose to go elsewhere, he says.