We chose to profile Gil Penchina, a serial entrepreneur and prolific angel investor, due to his success leveraging innovative technologies in the venture capital and angel investing industry. Gil is focused on helping entrepreneurs and investors achieve great success. He has been one of the most successful AngelList Syndicate leads. We look to showcase some the strategies that led to this success.

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Gil Penchina has been called a “Unicorn” because of his track record of angel funding success, while he prefers to consider himself “a regular guy with an idiosyncratic antenna”. At the time of writing this article, he has raised one of the largest AngelList Syndicates, or angel investment vehicles. Leveraging a personal brashness of relentless urgency, hyper-scaling and constantly refining go-to-market strategies.

Founder, Leader, Investor

Gil Penchina finds innovative ways to scale his leadership and capital. He is the co-founder of Pryze, and Fastly. Pryze is the first provably fair sweepstakes platform build on Etherium and Fastly powers fast, secure, and scalable digital experiences. He is a board member at Vouch Financial, helping borrowers get personal loans at better terms than other lending institutions or marketplaces typically offer. Gil helped create Angelmob, a platform to help startup founders leverage their communities so they can succeed through collaboration.

Mr. Penchina is invested in companies and ICOs such as Brave, Ripple, Filecoin and Civic early on as well as, Polychain, AngelList, Bitcoin and Ethereum. Gil has been an active angel investor in 100+ companies over the last 13 years including firms such as Linkedin, Paypal, Datanyze, Indiegogo, Evite, Wealthfront and many others. He specializes in consumer, marketplaces, SAAS and other products that can be sold without sales people. Follow Gil Penchina’s updated investment portfolio.

Building AngelList Syndicates

Gil created several AngelList Syndicates with a mix of partners, associates and  a team of entrepreneurs that know what it’s like in the trenches. Gil partnered with Nathan Creswell to build the Flight VC AngelList Syndicate, 25 syndicate managers/partners, 100 associates and scouts along with 3000 backers. Mr. Creswell is a product director at Zuora and leads the B2b SaaS focused syndicate.

Accredited investors can invest alongside Gil and team via AngelList.

Anyone considering an investment in one of the syndicates needs to understand that these investments represent absolute risk; they can lose all their money. There is no guarantee of a "soft landing" or acquisition if things do not go as planned. In addition, there is no guarantee that, even in a successful company, there will be opportunity for liquidity for the shares represented and an investor should be prepared to have their capital committed for up to ten years, or more without liquidity.

Venture Capital

Gil is a partner at Ridge Ventures (formerly known as IDG Ventures USA) headquartered in San Francisco, California. Ridge Ventures is an early stage venture capital fund investing in experienced founders redefining how the world interacts with software.

Ridge Ventures delivers advanced technologies, new distribution models and incredible user experiences to market. Their approach is fast, flexible and founder-focused creating the right relationships right from the start; they bolster companies allowing them to become market leaders quickly. Such companies include Krux, MindMeld, TellTale Games, Next Games, Minted, Fastly, for starters. Gil has also taken on a new advisory role with SYNCFAB.

Investing Thesis

So, what did Gil get right? Well first he set out clear investment limits and remained aware of these limits. Gil shares insights on The Syndicate Podcast, by  Matt Ward, “How Gil Penchina Tried to Lose Money and Hit 5 Unicorns.” Gil might have been ready to lose every penny he had designated for angel investing but that was a defined amount. And secondly, he was wise enough to reflect on diverse points of view even when these points of view seemingly contradicted his own; the advice he received came from his community of friends, entrepreneurs and other serial investors.  

“All I do is talk to people, email people, take meetings and do interviews. Then I work at maintaining relationships with my investors because the trust people place in me is my business model.” Gill Penchina’s conversation with Jeff Cunningham, StarupGRIND

Gil Penchina started investing early on in eBay where he made some good money. His attitude now is that to be being an angle investor you must be willing to diversify between a minimum of 20 companies. He attributes a lot to effective listening, questioning and remaining humble – listening to other investors and good friends; this attitude has helped him stay focused and grounded especially when he’s able to reflect on just how stupid an idea might have been…

Betting on crazy people isn’t only exciting but it just may be the best way to get in and stay in during the lean starup years. Going in with the attitude that you are trying to “go bust” is real commitment. But be clear Gil might seem sloppy, and he admits that has his moments, he also knows what he’s looking out for. He does his homework i.e. this is not his first rodeo he’s was in PayPal before X.com even existed as well as in LinkedIn during the early years.

Gil takes notes and journals to constantly remind him that everything is subject to change and that you are betting more on the team rather than on the idea; sometimes. “We all often try to create a mental history of what happened that changes over time so I found that the humility to sort of go back and read my original notes and go oh ya I did say it’s [a bad] idea didn’t I? Hmm; Oops.”

Blockchain

At Fund Wisdom we believe Blockchain is a fundamental innovation changing the way business and commerce is done. The stored value, distributed networks, securitization of assets, and public ledger, can lead to efficiencies at scale. “Blockchain requires cryptography and the ability to have a public ledger that is completely immutable, perfectly safe, distributed all over the world. Our processor serves as the perfect processor to enable this supercomputing capability to be distributed. And that's the reason why it's used.” Nvidia CEO, Jensen Huang.

Today Mr. Pencina is bullish on blockchain and cryptocurrencies. This technology enables identity and associated data to be decentralized and controlled by the user. Crypto projects are solving for identity protection, “Right to be forgotten” and “Data Portability”. “I don’t think you can have a big data win as easily as you have a tools company that provides big data to other people.” Jeff Cunningham’s interview with Gil Penchina. “ I do think Security tokens are coming, mostly because we all want them to.” The SEC and other security regulators are looking at ICO’s as securities. “[We’re] starting to see securities tokens with Bitcoin Capital’s BCAP, to brokers like Cointopia and Polymath, and enablers of security marketplaces [in] folks like tZERO and others,” said Mr. Penchina.

One of the companies Gil Penchina invested in is Polymath, who look to help securities to migrate to the blockchain which can help reduce costs of local expensive exchanges, improve global and round the clock access. Polymath enables financial service firms to provide “Security Token Offerings” or STOs. The Polymath team looks to apply this beyond common investable assets, to every home, equity offering, and more. One of the challenges the industry faces is how the SEC classifies and regulates. Gil has shared his views on TechCrunch that, "Protocol-level tokens (Bitcoin, Ethereum, etc.) do not have any assets of any kind underlying them and remain far from the SEC’s current focus." If you are looking to keep up with Gil's latest thoughts and strategies in the space he produces an ICO Insiders Mailing List.

Conclusion

Gil Penchina has built a massive network leveraging platforms like AngelList. He is a successful investor we admire and hope our readers can learn from.

At FundWisdom we are passionate about providing innovative solutions to your equity investing, and financial marketing concerns. We look to help uncover strategies and solutions to transform the investment experience.

Not every investor will have the same drive, tenacity and professional network available to them. If you’d like to comment or just want to share your insights we’d love to hear from you below or via our contact form.