Thread by @dunkhippo33

Let's talk about geography. @TraceyJCarr brought up good qs that I think we should touch on as a community.

1) The best startup investment opps are now global. Why? Top 1% global >> Top 1% SV. Valuations low! Opp to grow later in SV: eg Front, Intercom, Talkdesk, many others...

@TraceyJCarr 2) In addition, @zoom_us has made it possible to talk with founders everywhere - remotely. No need to traipse around the global to do Board mtgs in person.

We do all our mtgs w/ startups via Zoom and WhatsApp incl our SF cos.

@TraceyJCarr @zoom_us 3) BUT, there are still challenges. In some cases, currency challenges. Or infrastructure. Or governments. Basically instability. But the world is actually a pretty stable place these days.

@TraceyJCarr @zoom_us 4) In most cases, the challenges are actually LEGAL. Isn't that frustrating? LEGAL. Not opp size. Not founder quality. Not even unstable govs. LEGAL. I'll give you some examples.

@TraceyJCarr @zoom_us 5) At my last fund, we did a few deals in Spain and Brazil. They were still tied up in legal by the time I left. (those deals had NOT closed for a $125k-150k check in 2 years even though everyone wanted to complete it!)

@TraceyJCarr @zoom_us 6) In the UK, angels get tax breaks for investing in UK companies. When UK companies came to the US, they had to decide what to do. Converting to US cos would make angels lose those tax breaks. But, US investors want to invest in US cos. Stalemate.

@TraceyJCarr @zoom_us 7) In Germany, if you raise a priced round, you need to stand in front of a notary to listen to someone read out in German and English the legal docs - this takes hours. If you are an investor, you need to send someone (you can pay a proxy). This is too expensive for small checks

@TraceyJCarr @zoom_us 8) In MANY countries (too many to name), SAFEs aren't allowed. You need to be raising priced rounds, which means expensive legal costs, which means large rounds. Hard for small investors to participate - the legal fees don't make sense. But small investors give cos momentum.

@TraceyJCarr @zoom_us 9) There are also MANY companies where it is hard to take money OUT of the country if you end up making money. Investors stay away from those too.

@TraceyJCarr @zoom_us 10) In CAN (my fav place to invest), being a Canadian entity enables you to access more grants / credits than a US cos. But prev, US investors didn't want to invest in CAN entities. THIS is changing. US investors are now more ok with CAN entities. CAN seems to give fewer grants.

@TraceyJCarr @zoom_us 11) Every country has its quirks and nuances no rule system is better or worse. But as a small check investor, we try to minimize our LEGAL fees, and this is a big reason we restrict our geographies at this time. It makes no sense to invest $25k and pay $1k in legal fees.

@TraceyJCarr @zoom_us 12) The biggest feedback I give "innovation" arms of govs is to 1) Streamline co formation. 2) Make it easy for foreign investors to invest & get money out. 3) Allow your companies to convert to US Del C corps. You will create tons more jobs in your nation in this global economy.

@TraceyJCarr @zoom_us 13) Lastly, my goal is to someday have a truly global fund with @HustleFundVC. But until LEGAL gets solved on a country by country level, we have to be selective around where we do business even though there are great companies everywhere.