How do I invest in a start up?

Maddy: [00:00:20] Welcome to You're In Good Company, a podcast that makes investing accessible for everyone. I'm Maddy, and as always, I'm in some very good company with my co-host Sophie.

Sophie: [00:00:29] Hi, Mads, how are you today? I'm sad that we're back recording online like we're in the studio. Last time we had such a good time

Maddy: [00:00:37] good run of a few studio sessions and now we're back online, but that's OK. It's still good old us 

Sophie: [00:00:43] I've warned the housemates. No talking. 

Maddy: [00:00:47] Coming up on today's episode, we are chatting all things angel investing and start ups. 

Sophie: [00:00:53] I feel like the Start-Up space is, you know, incredibly interesting, but it's also something that retail investors really struggle to access. So I'm hoping that today's conversation we can kind of pull in elements of the Start-Up space that we can use as investors like to using our own investment decisions and journeys. 

Maddy: [00:01:11] Yeah, completely agree. I think there are some great lessons that you can take from the Start-Up space, especially the successful Start-Up space and how we can really see how that can apply to investing in companies that are listed. And that is why today we are excited to welcome Cheryl Mack to why I say Cheryl is passionate about supporting the growth of the Australian Start-Up ecosystem. She's a mentor, a strategic advisor and angel investor, and has recently founded her own Start-Up Aussie Angels, which provides start-ups with the resources they need to build the next world changing companies. Cheryl, we are stoked to have you join us today. Welcome to you. Are in good company. 

Cheryl Mack: [00:01:46] I am so excited to be here. 

Sophie: [00:01:48] Oh, I'm so excited to have you now. So what's the best thing that's happened to you in the past week or past seven days? 

Cheryl Mack: [00:01:55] Oh, so many things to name I. But something that I will call out is that I got to sit down with the team from TechCentral Sydney, which is the new precinct that is being built around Central Station. And I got to sit down with the team and teach them a little bit about angel investing and talk to them about what's going on in the world of Angel investing in Australia and what's needed and how to bring things together to really support the next generation of angels and founders. So that was so cool. I've never felt so listened to in a government building before.

Maddy: [00:02:29] I love that. And if you could have dinner with anyone, who would it be and 

Cheryl Mack: [00:02:32] why this might be a random one. You might not know who I'm talking about because I'm that weird person that doesn't name like Warren Buffett, but my person is avowal. Narvel is the founder of Angel List, and the reason is because I am building the Australian version of angel lists and tickets, and so I would love to sit down with that man and pick his brain. 

Sophie: [00:02:52] Yeah, you'd probably get a lot out of that dinner and then be able to transfer it over to Australia, which would be great for us. So we want that dinner to happen as well. And if you could be a stock or company, who would you be and why? 

Cheryl Mack: [00:03:05] I again like probably Angel Ester Gum Road, actually again out of left field, one like Gum Road, just raised from their community of people who are using the product rather than actual investors. And I think that is super cool. Like whenever you democratise access to something, I think that that is exactly what the world needs. So probably Gum Road. 

Maddy: [00:03:24] Can you quickly explain what gum right is?

Cheryl Mack: [00:03:26] Yes. So Gum Road is basically for people who want to start their own business. Say if you want to start like an E! Commerce business, or if you want to start a side hustle or like your own gig type thing, you can get started really quickly and test what works and be able to essentially jump on. Create your own side business. If it works great, you continue. If not, you can try something else. And I think that really embodies the movement that is happening in the economy right now around wanting to have ownership, wanting to be able to create your own future. And that's really that's what they do. They allow you to create your own future. 

Sophie: [00:04:06] I think that's really cool as well, because you can kind of test the waters a little bit like if something fails, it's like, Nope, that was a fail. Let's move on. 

Cheryl Mack: [00:04:12] Yeah, exactly.

Sophie: [00:04:14] So, we wanted to jump into a little bit about you and your background with your work in with Aussie Angels. But first, because we've mentioned the term a couple of times. What is angel investing?

Cheryl Mack: [00:04:25] What is angel investing? It's this kind of, you know, generic kind of abstract term that, you know, there isn't really like a tick mark. You know, when you when you go to law school, you take the bar, you know, somebody gives you a hey tick. You're a lawyer. Now, Angel investor is one of those titles that no one officially ever gives you. You either you can assign it to yourself or not, but essentially what an angel investor is is somebody that puts their own capital into extremely early, very risky businesses, and most of them go to zero. Most of them make no money and you lose your money. But the one or two that make it really big tend to make it really big like 100 acts, so they cover all of the losses on the other ones and then some. And we call them angel investors because really angels are coming down to fund businesses that really shouldn't be funded. And it's very, very risky capital. 

Maddy: [00:05:28] So can you tell us a little bit, I guess, about how you got into angel investing and the start-ups face a bit more broadly? 

Cheryl Mack: [00:05:34] Yes, actually, it's a funny story I never intended. I didn't set out to be an angel investor, and four years ago, when I started, there wasn't an angel investor. Courses like there are now in Australia. So the way that I got into it, I kind of fell into it. I was I had built a company I and we were doing pretty well. My background was in marketing or still is, I guess, my background in marketing and storytelling and branding and go to market strategies. And I was talking to a start-up and they said, Hey, Cheryl, like, you know, we'd love for you to come work for us. We can't pay you, but we can give you some equity as in a piece of their company instead of cash. And I was like, Yeah, OK, that sounds good. And then another one kind of said the same thing. We're like, Yeah, we'd love for you to work with us, you know, skillset. Awesome. Can you can you come work for us? But we don't have any money to pay it. We'll pay you an equity. And I'm like, Yeah, that sounds good. Like, you know, it's just my time. What's that worth, right? And then, you know, as you know, so it's working for these companies. And I was having a chat with one of the founders one day and and he said, Oh yeah, we're just trying to close our funding round. I, you know, we're trying to finish raising. We've raised, you know, four hundred and eighty thousand of the five hundred that we're trying to raise. And I was like, Oh, twenty thousand that that's what's left. Oh, I could do that. Like if that helps you get back to running the company, like, you're like, All right, that check, and then we can be done with this whole fundraising round thing. And then that happened again, you know, as another founder that I was working with and they're like, Oh, we're just trying to close our 

Maddy: [00:07:06] round, just you out for the easy money. 

Cheryl Mack: [00:07:10] Exactly. But you know, two companies in and I go, Oh Cheryl, I love swear here. But you use,

Speaker 4: [00:07:17] Oh oh, I think, I think I'm 

Cheryl Mack: [00:07:20] like investing a little bit. So I like called up some of my VC friends, venture capital friends, and I called up some of my other angel investor friends. And I'm like, Hey. So I think I might have started angel investing. What do I need to know? And they were like, Wow, OK. So the bad news is that you, you're probably going to lose that money that you already invested. The good news is that if you stop now, you probably won't lose any more money. And I was like, OK, is there an Option B? And they were like, Yes, yes, Option B is if you keep going and invest in like eight more, you have a chance at making it all back. And then some on these companies, you'll probably still lose that money that you've invested already, but you have a chance at making it all back. And I go, Okay, great, I choose Option B, so I double down. 

Sophie: [00:08:12] And here we are four years later. 

Cheryl Mack: [00:08:14] Twenty two companies later and a couple of funds.

Sophie: [00:08:18] And yeah, I'm so curious to know, did you lose your money on those first two investments that you may not yet? Oh, so they were wrong? Well, it's

Cheryl Mack: [00:08:27] arguably arguably we're still to find out. I think probably I will on one of them. One of them is one of those companies where like, I think over indexed on that attack in the product rather than the founder in those early days, I got really excited. I was like, Yes, this is awesome. Like, amazing rather than like, is this the person that is going to build this company? The other one that was doing really well. So they they were probably wrong on that one. Like they raised the next round. It's already like three to five. I think it's like five x already. It's like five. It's worth five times as much as when I invest it already. So that one's doing really well. So they were wrong on that front. But the thing is, with angel investing, you tend to see your losses sooner than your gains because your gains, particularly like in terms of actually getting cash out of your investment, getting the return on your investment. That typically happens on a five to 10 year period. Where is I your losses in terms of the companies that fail? That typically happens between two to four years. So already in the first four years that I've been investing, I've had two losses as in the company failed and I've lost my money, but I have not actually had any exit. So no company has returned more money than I have invested. A lot of the companies that I've invested in are worth more than I invested, but nothing is actually returned the money yet, and that's because I'm only four years in these. These things typically take five to 10 years, so I'm at least at least if not longer at your way. 

Sophie: [00:09:56] So I am really curious thing because it obviously does seem like. A bit of a risky game, and I'm not sure how you sleep necessarily at night, but what do you love about investing in the Start-Up space? 

Cheryl Mack: [00:10:08] There are a number of things that I love. One of the things that I love is that while it's speculative and risky, it's not volatile. And I'm the type of person that is a little bit emotional and my mood can be swayed by something as simple as, you know, my friends being upset for the day or, you know, losing my ice cream on the streets or missing the train, or, for example, the stock market being down and my portfolio losing 20 to 50 thousand dollars in a 24 hour period.

Sophie: [00:10:44] Let's not talk about it, shall we?

Cheryl Mack: [00:10:45] So what I found and in particularly over the last two to three years, I think the catalyst was the Start-Up Covid when things really dropped. I, looking at the portfolio of ASX stocks every morning was really affecting the mood in my household. My my fiancee and I like. I could tell when our portfolio was not doing well because the mood would just be not good. It would be down or there's just not good. And then the days where, like, it'd be like, it's up. I could tell it was up and I really did not like that. The mood in our household was dependent on a little number on a stupid screen that was being based off something completely irrational, like the stock market is not rational. It's based on human irrationality that has nothing to do with the value of these companies. So slowly, over the period of 2020, we pulled out of the ASX and that was the point where I realised I much prefer something that I invest my money and I do everything I can to help that founder. But at the end of the day, it's going to go to zero, where it's going to go to 10, 20, 20, 20 times my investment. But if it goes to zero, it's going to be one minute, I think. OK, great. This is a company that's doing OK. I've got the last update, but tomorrow they send me an email and go, Hey, we're we're shutting down. We didn't make it cool. Money's gone. All right. Well, you know, I might feel shit for that one day. But yeah, it's it's not an up and down. So that's probably one of the first things that I would say is that it is. While it's much more speculative and risky, it's less volatile. And I appreciated that. 

Maddy: [00:12:27] I guess it's kind of cool as well, because as an angel investor, you can actually sort of get into and help out with the management of the company. So like you can. To an extent, have a bit of control or some input into how well the company performs too. 

Cheryl Mack: [00:12:39] Exactly. And that's one of the best things. And that's my next one is like, what do I love about angel investing? I love that I actually can have an impact on helping these companies, whether it's, you know, shit's hitting the fan, and I got to jump in and make sure that we don't lose some contracts cool or if it's strategizing, how to do the next raise or if it's making Connexions to potential customers like typically when I angel invest and there are a number of different ways that you can angel investor, I can go into those if you'd like. But one of the ways that I do so is when I actually invest directly. So I put the money into the company directly and I sit on their capitalisation table. When I do so, I only choose companies that I know I can help if needed and not pushy about it, but I know that I could help if needed. And so that's fun to know that, you know, this is a company that I can help, and generally I do help. And then the other one is that like you get to choose when you angel invest, you get to choose exactly which companies you're supporting. And to me, I see that as supporting the future of Australia. I know that sounds corny, but it's like, I love it here. 

Sophie: [00:13:45] First, folks

Cheryl Mack: [00:13:47] in an ecosystem where anywhere from, you know, nobody has exact numbers, but anywhere from 2500 to 5000 companies are being formed each year. Me being able to say this is the company I want to put my money into because I want to see this company exist sometime in the future means that I'm having an indirect say in what I want. They're actually a direct say in what I want the future of our country to look like because I want this company to succeed and I'm giving them money to succeed. So I feel like I'm fuelling the next generation of what I want in the world and my ecosystem. 

Sophie: [00:14:21] I think that's also that can be related as well to I know that you just said that you don't invest in the stock market, but I think that's something that many and I always discuss as well, like with investing that you can actually choose companies to invest in that are making an impact. And I know that these days a lot of companies are public, so you still kind of have that variation. It's not as much as angel investing, where you know, there's the real start-ups facing a lot of companies coming through. But I think that's one of the best thing things about investing. 

Maddy: [00:14:49] You can follow your passions. 

Cheryl Mack: [00:14:50] Oh, 100 per cent. And actually, I do appreciate that about Australia in Australia. You can do a Series B or you can basically list. It's easier to list is a smaller company on the ASX than it is to list anywhere else in most developed countries in the world. And so that means that you have a lot of really micro-cap or small cap companies that are listed on the ASX. And so you can actually like it. There are companies that are at the same level at which I'm investing directly, that are private, that are there are the same level companies that are on the ASX and you can put your money at that place just again. No, those companies tend to be volatile, and those types of companies like you can also do your duty on them. In fact, if they're listed, you can do a lot more data on them due diligence than you can if they're private companies. So you can you can almost play the same game while still not necessarily investing in private, unlisted companies, which I think is pretty cool.

Maddy: [00:15:51] So, Cheryl, you have also just founded your own Start-Up Aussie Angels, which is doing some incredible work to support the Australian Start-Up landscape. Can you tell us a bit more about how Aussie Angels works?

Cheryl Mack: [00:16:03] If you are an angel investor and you want to pool your capital with another angel investor, i.e. put your two cheques together into one entity that goes into that company in Australia, that's not really easy to do. And I had an issue with that because I was like, If I want to invest, I want to diversify my investments as much as possible. So that means smaller cheque sizes more companies, right? This is basic investing principles that I've only diversification. Exactly. You know, diversification. It's like Wolf of Wall Street, right? Diversification. So when I was looking at starting like when I was angel investing, I looked at it and I said, Great, I want to do. I want to invest in more companies, more. How do I do that? You know, I'm not infinitely rich. I don't have millions of dollars on our family office. All I need to reduce my cheque sizes so that I can invest in more companies. What's the best way of doing that? Well, if I put my money with other investors, then we can still meet the minimum cheque sizes that start-ups tend to want. And then, you know, we can get into these companies. Turns out doing that, though, comes along with a ton of regulations. And when I realised that I was like, OK, I'm going to start my own syndicate. Great. Starting a syndicate seems easy, right? No, unfortunately, that is not easy. 

Maddy: [00:17:28] I was going to say, I suspect that's rhetorical. 

Cheryl Mack: [00:17:30] Yes, it was difficult and costly. It's basically a 50 to 100 thousand dollar problem to do in Australia. Wow. And along that journey of doing that, I was like, Well, if I'm going to build it for me, I may as well build it for everyone else. 

Maddy: [00:17:47] I love that. 

Sophie: [00:17:48] So kind. Thank you. Right? 

Cheryl Mack: [00:17:51] So I set out to find a solution to not do to not spend 50, 100 thousand dollars to do this angel syndicate and ended up doing everyone else's. So now I run a lot of I do the back end. Essentially, that's what we do. We run the background of an admin side of anyone who wants to run their own angel syndicate. Here's the cool part, though, so that's the boring add. Many like functional What do we do? Here's the cool part. If you are an angel investor in Australia and you want to pool your money with other angels and access really cool companies that you might not get into because you don't have the relationship with the founder. Prior to launching Aussie Angels, you had about 10 options to do that 10 places where you could find syndicated deal flow. Put your money and your minimum amount that you had to put in was $10000. Since we've launched Aussie Angels, there are now 14 additional. So 26 now total. So I've more than helped double the number of angel syndicates that you can join as an angel investor and you can put a $5000 check into those companies. So we have doubled the number of places and halved the minimum investment that you need to make.

Sophie: [00:19:10] I find that $5000 figure. Really interesting because whenever I read about angel investing, I always think of it as something that like I could never access. I always think of it as a cheque size of, you know, 50 100 plus grand to put in. So it is pretty cool that it's kind of democratising this space because $5000 for people that can save up to invest is accessible to a larger portion of our population. 

Cheryl Mack: [00:19:34] Absolutely. And that's exactly what I wanted to do because there are a lot of people who are able to invest those types of sizes. And even like, it's not that you need $50000 per company, you can have $50000 total and still get a diverse portfolio through Aussie angels by putting $5000 cheques into 10 companies. And that's the recommendation, right? If if you want to do angel investing, we recommend actually not we sorry, this is not financial. Bryce in any way, shape or form disclaimer for the whole episode, but the general recommendation not for me specifically is a portfolio of at least 10. So by reducing that, by offering opportunities to invest, you can have just $50000 just to get a really diverse portfolio in terms of start up investments. So know if you're thinking like I need $50000 per company. Not true. I this is something like I got started when I got started. Yeah, I mentioned my my first check was twenty thousand actually. My first and second checks were twenty thousand. But as soon as I knew what I was doing, I reduced my check size of 10k and I was. I was not even sophisticated at that time. I talked my way onto cap tables. I talked my way on to investing directly with start-ups. I basically said, Hey, you want me? You're going to let me come on to your cap table with my ten thousand dollar check when your minimum is twenty five. And this is why we need

Sophie: [00:20:57] more of that confidence around. Tell you,

Maddy: [00:20:59] Cheryl, I'm very excited to hear what kind of companies and what kind of industries that you are investing in, but where you're going to take a quick break for our sponsors and we're going to be right back to discuss the industries that you believe have a great potential investing opportunities. 

Sophie: [00:21:17] So the Aussie start up space is really starting to make a name for itself, I know that you've mentioned in previous podcasts that when you first arrived in Australia in 2015, there was less of a start-up space. Can you tell us a little bit about what it looked like and how it's changed over the past six to seven years? 

Cheryl Mack: [00:21:35] When I came to Australia in 2015, I was already in the Start-Up space in Canada. But when I 

Sophie: [00:21:41] landed, but there was no start-up space in Australia, I wouldn't 

Cheryl Mack: [00:21:45] say there was none. That's probably an exaggeration, but I compared to the West Coast of Canada. It was nearly negligible and I think I've seen the scale and speed at which the Start-Up ecosystem has scaled over the last five to seven years. I've been here seven years now, so five to seven years. And I think that is what's got huge potential for Australia. Like we've been able to move and like close the gap in terms of the ecosystem in a span of half the time that the U.S. did it. And I think that's exciting. 

Sophie: [00:22:24] Well, we saw we've seen like a lot of companies like Atlassian, Canva, Afterpay, just to name a few. Kind of come through the ranks. And I guess it is really interesting to kind of watch these tech companies and how they've been evolving in the Australian landscape. But what do you think the future of the Start-Up space looks like in Australia?

Cheryl Mack: [00:22:44] Yeah, that's a really good question. Don't quote me on this team I've been known to. I've been known to be wrong before, but I think the exciting spaces to keep watch on are anything that puts more control back into the user or the consumer's hands. So things like user generated content, things like e-commerce that are direct to consumer data see things that democratise access to things that people wouldn't have had access to otherwise. Anything that is essentially taking control that used to be tightly held by large corporates and putting it back into the hands of people that are filtering their money into different products, companies, services. That's that. Those are the industries that I think we're going to see explode, and I have a huge impact on the future of where our economy goes. 

Maddy: [00:23:38] Speaking of things that are tightly controlled. We know that starts that seems to come up every single year, and it's like female founders share just around. I think it's two percent of total capital raised 

Sophie: [00:23:58] no no longer question them. Say, Like, Why tell me why? 

Cheryl Mack: [00:24:03] Oh man, so many reasons. I really frustrating reasons. But things like, first of all, it's a numbers game. When you don't have enough founders who are women, then of course, the number of women who get money is just simply going to be less because it's a proportional thing. So even if we had equal amount of money going to women and men in terms of businesses, if there are just less women to invest in, of course there's going to be less. So that's the first thing that compounds everything else. The next one is that typical venture. I tend to invest in things that women are less likely to find found. So if I look at all of the businesses that have been pitched to me over the last 12 months that are founded by women, so, you know, not just like a female led business, but like founded by women, I've. A significant majority are more lifestyle, not lifestyle, but more things that are traditionally women, so things like e-commerce, things like fashion, things like like, yeah. Community stuff, which typically particularly in Australia, I aren't the most attractive to V-C money. And here's the kicker. You know why they're not attracted to these like see is not attracted to these particular industries. And by the way, this is changing and there are a number of funds that are changing this, and I really appreciate all the funds that are so props to all of you. But you know why? Because the people who are sitting around the table being the investment committee table, the people that make decisions as to who gets money and who doesn't. They typically do not have vaginas. They typically are all men. So the next reason why we aren't seeing a lot of money going into women is because the people at that table aren't women. So we need to change that because of course, if you've got a bunch of men sitting around a table saying, Well, why would I invest in this bra company? I don't understand it. You know what? What's the market for bras? Why is this really a painful problem? Like all of the questions you ask when you're evaluating a company? If you just aren't putting a female lens on it because you don't have a vagina? While, of course you're going to say this isn't a good investment. 

Sophie: [00:26:33] Well, that's the thing. I mean, at the end of the day, you have that perspective that you want to be able to use. And if you have that perspective, you can better understand whether that company is actually going to have impact or not. But that's where that whole diversity factor comes in because women make up more than half the population. So if you're going to have more than half the population using something just because you won't use it, it doesn't mean that it's not going to be successful. 

Cheryl Mack: [00:26:56] And like on one hand, you know, I don't want to fault them because the advice that you give new investors is, look at things that you understand. And you know, I don't try to invest in medtech companies. I don't try. I don't try to invest in B2C mobile games because I'm just not good at consumer things. I, you know, and in particular, consumer mobile games, so that that advice is sound. If you're going to start investing, pick industries that you know that you're close with. If you do a ton of online shopping like you might be a good, you might want to look at the e-commerce industry. If you work at a bank, you might want to look at fintech. And so that is some advice, and I can understand why those people who are making those decisions aren't investing in things that they don't understand, because the general advice is don't invest in things you don't understand.

Maddy: [00:27:47] I think that's the coolest thing, though, right, is that they're actually probably that probably means that there is really great opportunity for us to explore that path because we can bring a whole new perspective to what potentially great investments look like. How do you think we can change or improve these statistics and get more money to female founders?

Cheryl Mack: [00:28:05] Yes. So the first thing is that we need to put more women around the investment committee table, and there are a number of funds that are doing that. So it I think it starts there because that's something that you can do if you're running a fund. If you're out there and you're running a fund, put women around your investment committee table, Blackbird Air Tree Square Peg. A lot of them are doing this, and I really, really appreciate that a wife as well. Our Innovation Fund and Black Nova Ventures as well, just calling out that the ones that are doing it and giving them some credit. So these this is the this is one of the first things, but then the next one is if you have money to invest and you want to invest in this asset class, look at underrepresented founders, not just because you should, but because actually they represent outsized potential returns. If there is a male led B2B SaaS company and that male has exited a previous business, you better believe they're getting a 20 x 20 20 male valuation on an idea, you know, like it, if not more, that is good and great for them, but that female founder who is not that person who's got the 20 million valuation represents an opportunity for untapped potential. So put your money in a place that has a really good deal. I like it. If you're going to go and invest in that company on that 20 mil valuation, the chances of you getting a 10x exit, I mean, maybe because they've done something in the past short, we call those hot deals, but hot deals aren't necessarily good deals. The ones that are good deals are the miss missed founders who are amazing people. Maybe they haven't exited before, but put your money there. It's just it's just good business. It's a good deal. You have an amazing chance at getting a really, really good return. On that, the next one is eight, like you as a consumer, you have the power of choice and you have the power of putting your money in places to have an influence on what that means. For example, if you are just buying something looking at where they sit in terms of pay equity from their executives to their lowest, that's something that can really help women in in terms of like being more economically valued. I looking at female like CEO businesses and putting your money there, so I could name a few like don't don't buy Nestlé products. I, you know, go, go and buy products that are led by female CEOs or have a really low executive to lowest pay ratio. These are things that help women all over the world. And when you empower women to build businesses or just to have a better stance in life because they bring home a slightly higher paycheque like those are the kinds of things that really have a flow on effect in terms of the economy of the whole world. But mostly like when you're looking at Australia, pick Australian brands that are doing good for the world that have gender equality, that have sustainable practises. These are things that actually make a difference, and that's something that you can do as well. Like, if you're not in a position to invest directly into a female led business, then these are things that you can do at home with not any, not any capital. 

Sophie: [00:31:26] And I think the best thing about that these days is that we have so much access to information, so it's not even hard to find businesses that are run by women and products that are made in Australia like it's so accessible. It might not used to have been so accessible, but these days it's easily done. So I wanted to ask, you touched on a little bit. You know what you were saying? Finding a good leader is what kind of makes up a good start up. But I guess more broadly, from your experience, what does make a good company?

Cheryl Mack: [00:31:55] The first thing that I look at as the founder, the person that is going to build this business, I'm like, is this the type of person that I want to back, regardless of what the business is like? That's the first thing that we look at is, you know, I have a chat with them and say, you know, I'm looking at, is this the kind of person that I would work with? Is this the kind of person that I think would be able to lead a, you know, right now they've got a two person company or five person company. What would they look like if they were leading 100 per percent company? What about a thousand present company? What about a twenty thousand four as a company? They were the CEO of Atlassian. Like, do we think that this is the type of person who's going to be able to handle that and grow with this company? I guess you can replace CEO, but it's not ideal. You know, nobody can. Nobody can drive that vision. The next one is like, is this person to be able to attract good talent? One of the things that people think, Oh, I need to have a really good pitch that I can get investors as an investor, I'm looking at it and going, You need a really good pitch because I need to know that you're going to be able to sell like talent. I need to know you're good at pitching, not because you need my check, but because I need to know that you're going to able to build the team. And then I look at, Well, is there a big enough market here? Is there a painful enough problem and enough people who are experiencing that problem that they're and they're willing to pay for it to be solved? And the next one is, are you the right person to be solving that problem? So you could be an amazing founder and you could be trying to tackle a huge problem. But if you have absolutely no experience in that particular space, I'm going to go awesome, founder. Big problem. Not the right person to solve it. So that kind of like those three things need to come together as a really first step for me to be able to say, I'm interested in writing a check into this company. 

Maddy: [00:33:39] And I think all of those things are totally applicable to all investments like Bay. Like we said, they are what make up a good company and they are what make a really scalable company. So I think that can be a great investment thesis. So, Cheryl, I'm really interested to hear about, I guess, what is on your radar at the moment. So I think it brings us very nicely to our watch list. Each episode, we ask our guests to add a stock or company or even news trend industry to our watchlist. And the purpose of this really is just to get us thinking outside the box and broaden our horizons in the investing space. Of course, we're not financial advisors and this does not constitute financial advice. But what are you bringing to the watch list today?

Cheryl Mack: [00:34:25] You've already heard that I don't invest in listed stocks anymore. But what I would like to bring is a piece of news that I think is very relevant to this space and anyone who is considering potentially getting a job at a start-up. And that is that recently they have announced that they are going to make some changes to the ESOP, which for those of you who can't remember what that acronym is, myself included, is the employee share option plan ESOP. And essentially you need to know the acronym. All you need to know is that. If you go work at a start up, one of the main reason you would do so, it's not because of the mildly mildly reduced pay and fast paced environment that becomes stressful. It's because if you go work at a Start-Up, you get equity and that means that you get a little teeny slice of that company. And if you help it grow and nurture it and pour water on it and it grows up into this big company like Uber, Uber is a bad example. If it goes up into this big company like Airbnb B, then your little teeny tiny slice can be worth millions of dollars. So what have they done to the ESOP recently or actually what they're planning on doing is they are planning on making it easier for you to keep that equity so they are removing the tax requirements, which is a really good thing because if you're going to risk essentially it's opportunity cost, right? If let's say you got a nice corporate cushy job, you make $100000 a year and you're, you know, you're happy with that. Why would you risk that to go work at a more risky company that could shut down tomorrow and not be able to pay you? Well, the answer is the for the prospective or potential of making millions of dollars in, you know, a couple of years time rather than, you know, your $100000 a year with a three percent increase and a 20 K bonus. This is a really important one to help bring smart talent into this ecosystem that is going to help create the next twenty thousand jobs in this country. 

Sophie: [00:36:33] That is a very interesting one, and I have to ask obviously before we let you go because we have you here and all your incredible experience. Are there any companies that you're particularly interested in in the future and or one that you think could make a real impact on the world as we know it? 

Cheryl Mack: [00:36:47] I mean, look, I want to say Mike, my company Aussie Angels, 

Sophie: [00:36:51] obviously, you can say that 

Cheryl Mack: [00:36:53] genuinely because we are we are democratising access to this asset class. And like the fact that we've have the amount that you need to invest to be able to get in, I think is really impactful. But I would also say that there are a number of start-ups that are coming through the ranks that are focussed on climate, and we have a number even on ozone angels. We have a number of climate tech focussed syndicates that are looking to support in this space. So while I can't name them specifically, I'm really excited that this is a category that is getting a lot more attention and a lot more funding. And I think that that is going to be really helpful for our future and, you know, not burning 

Maddy: [00:37:35] a category, Terry, that I think there is an episode required hurricane. I think it's a it's an it's an area that so can I very interested in, but it comes up again and again and our Facebook community and in our DMs like people want to know they want to live their portfolio with their values. And I think that's the coolest thing about investing is you can align it with your values and you can invest in things that you are really passionate about and can kind of, I guess, change the world in doing so.

Cheryl Mack: [00:38:03] Actually, I do want to add one to that because you said investment. There is a company that I'm really excited about that you made me think of. It's called Bloom Investing, and it is an investing platform open to retail investors that is impact investing. So if you are thinking about putting your money in a place that is going to have that impact, particularly on things like climate, definitely check out Bloom Investing. 

Maddy: [00:38:27] I love it way it will make sure that we link that one in our Facebook group. But before we let you go, Cheryl, if you could have one piece of advice that you would give to yourself when you are starting out on your investing journey, what would that be?

Cheryl Mack: [00:38:40] Pick an amount that you are willing to sacrifice to the Start-Up ecosystem in order to see the future that you want to see. And I use the word sacrifice in the place of lose because it's not just that you're losing your money that sounds like you're gambling, this is sacrificing it for the greater good of our ecosystem. That's not to say that you should or you have to invest your money in this asset class is extremely risky. But if you want to get into it, just pick an amount that you're willing to sacrifice and divide that by 10 and then find places to invest each of those 10 investments. 

Sophie: [00:39:22] I think that very much aligns with advice that we often get about the stock market. Just pick an amount that you're willing to trial with and learn from there because honestly, once you have your skin in the game, that's when you do your best learning anyway. And I think that's really what we take from a lot of our interviews. So, well, aligned. Cheryl, thank you so much for joining us today. We have learnt a lot from this podcast before we go, is there anything that you wanted to plug anywhere? People can find more. Find out more about Aussie Angels. 

Cheryl Mack: [00:39:54] Yes, please go to Aussie Angels dot com and click on Join Syndicate's or Aussie Angels dot com. Slash syndicates and take a look at some of this indicates that are there right through their profiles? Mine is there. You can join mine. And even if you're not either, even if you're not sophisticated or you don't know what that means. Pop your details in there. There's no fees to join. There's no commitment to invest required poppy your details into the one that you are excited about or all of them if you're excited about all of them and we will go from there because there are things changing in the regulations around this space and we want to keep you informed. So there are lots of ways to just learn alongside of us. Even if you can't see the specific wholesale deals. 

Maddy: [00:40:38] Very exciting. I think I off to do that right now. Thank you so much for joining us, Cheryl. 

Cheryl Mack: [00:40:42] Excellent. It's so good to be here. Thank you for having me yet again. 

Sophie: [00:40:47] Another episode where I feel like I learnt so much and I'm going to listen back again because I feel like there's a couple of lessons in there that I want to just really nail down. 

Maddy: [00:40:56] I just love doing this. I get so energised from all of our chats. It's so good. 

Sophie: [00:41:00] I know tomorrow ladies will be texting me being like, So do you think I should work at a start-up? Because that happens every time there? I love my job. No, I actually do. As always, please find us on socials if your new life GC podcast on Instagram and also the same handle on Tik-tok. 

Maddy: [00:41:20] Jump into our Facebook group. It's by investing podcast discussion group. Give us your thoughts on the episode or post any questions that you have. We love hearing what you guys think there. 

Sophie: [00:41:31] If not, if you don't do any of that and you're just tuning into the podcast, right and review, because that would be really helpful. 

Maddy: [00:41:38] We also have been coming out, which is very exciting. So make sure you head over to the Equity Mates website and register your interest because you do not want to miss out. 

Sophie: [00:41:47] And Ren says coming up in October the 15th, 

Maddy: [00:41:50] it is that I'm just excited guys, 

Sophie: [00:41:54] but definitely check out those details will be there, which is exciting. Otherwise we'll catch you next week. Bye.