Ten Years. That’s how long I’ve been in this VC game (and helped start Alpaca in 2012). I feel like the Farmer’s Insurance spokesperson, who says, “We know a thing or two, because we’ve seen a thing or two.” Except in reality, we are still learning every single day, especially given the feverish pace at which startups, technology and the VC industry as a whole seems to shift.

But one thing that hasn’t changed in a decade – our number one priority is to find, access, and win allocation into the most promising early stage investment opportunities. And what also hasn’t changed is our publishing of this post, giving founders and investors alike an inside look at the deals we did in the prior year, how we sourced those deals and the initial thesis that got us excited.

If you’d like to see prior years, you can find them here: 2022, 2021, 2020, 2019, 2018, 2017, 2016, 2015.

So without further ado, I’m excited to share Edition 9 (2023) of Where Do Deals Come From.

Last year was a slow year for investing for Alpaca, as we were still waiting for the late-stage market correction to fully trickle-down to early stage valuations. We also made sure not to chase shiny objects and to stick to our core competencies of Real Estate Technology and Commerce. Here are our team’s 5 deals from 2023:

Optiversal (Investor Referral)

Through our Brand Discovery Field Study, we identified that SEO is a major focus for brands as the challenges of acquisition and third-party data post iOS 14.5 continues. As we typically do with our Field Studies, we openly announced and discussed our hypotheses, and a longtime co-investor (Red Sea Ventures) shared the Optiversal deal, knowing it hit our mark. Optiversal has created a discreet AI-driven enterprise workflow for optimizing SEO and content for retailers, which is a timely solution in today’s environment.

CoLife (Founder Referral)

We are bullish on the macro trends of co-living and housing affordability, both for renters as well as home owners who are over-levered. While most of the venture dollars invested into this space have focused on Tier 1 cities and sexier models (7 figure co-ownership, for example), we found opportunity in CoLife’s approach of focusing on owner-occupied homes with longer leases in Tier 2 areas. By layering on sophisticated matchmaking and insurance, we believe they can provide both sides added convenience and safety. All forms of PropTech, especially ‘modern living,’[ have been core to Alpaca VC since Day 1, so it’s no surprise Aubrie Pagano was an early recipient of this deal from Everlane Founder, Michael Preysman.

BinStar (Cold Inbound)

Who says VCs need a warm intro? Kudos to BinStar Founder and CEO Jack Laughlin on the strong, clear and compelling cold email that got the meeting, then got the deal done. Here’s why it worked:

1) His email was tailored to Alpaca, including referencing our thesis and portfolio companies.

2) He shared a simple outline I could read and decide on in < 2 minutes

3) His initial email included his deck

4) There was a clear call-to-action. Knowing Aubrie’s thoughts on ‘the returns problem,’ I forwarded it to her to get her take and opt-in for an intro call. A couple weeks later, a term sheet was signed.

Stealth PropTech Co (Investor Referral)

We can’t share much about this company just yet, other than it’s an incredibly experienced team taking on an ambitious mission in the residential homeowner space. Needless to say, our reputation for knowledge and value-add in this space made us a clear referral target for a well-respected seed fund also investing in the company. We’ll have more to share later this year.

Stealth Supply Chain Co (Founder Referral)

Similar to the previous deal, we unfortunately can’t share much about this Q4 ’23 deal yet, as they are still not public. What we can share is that they are doing what we think are pretty incredible things in cross-border supply chain. The source: a founder that one of Alpaca VC’s partners had previously backed.

Thanks for following along. Hopefully this helps continue to shed light on “how we do what we do” as investors, as well as the different ways founders can get their companies in front of their targeted investors in the future. Team-wide, we are looking forward to a busier 2024.

Have your own interesting deal to share? Hit me up directly at [email protected]c