Launchpad Venture Group and Race Point Merge to Form New Angel Investor Group

12/8/10Follow @gthuang

There’s a new organization of angel investors in town. Well, sort of.

The new entity is being announced today as the merger of two existing Boston-area angel groups—Launchpad Venture Group and Race Point Capital Group, which are headed up by tech investors Hambleton Lord and Christopher Mirabile, respectively.

Lord and Mirabile will co-lead the combined angel group, which will have more than 70 members, making it one of the largest in New England. (Nine-year-old Launchpad has about 60 members, while Race Point, which started in mid-2009, has 22.) The group will use Launchpad as its working name, but is also considering a new name.

Its investments will target early-stage tech (and some life sciences) companies, and will be made by individual members—Launchpad doesn’t have a fund, and Race Point’s fund (of undisclosed size) will continue to be managed by Mirabile. Launchpad’s portfolio includes a wide range of companies such as Boston Heart Lab, EveryScape, Localytics, Mobius Imaging, and TimeTrade, while Race Point’s includes such startups as Daily Grommet, Pixability, and Zyrra.

The move exemplifies area investors’ increasing focus on seed-stage startups that have progressed beyond the level of an incubator or accelerator program like TechStars or MassChallenge, but are not yet ready to raise a full-blown Series A venture round. Indeed, Launchpad plays in a crowded investor space that now includes angel groups such as CommonAngels (which has recently ramped up its seed investing) and Golden Seeds; “micro-VCs” and other seed-stage-focused firms like Project 11 Ventures, NextView Ventures, LaunchCapital, and Founder Collective; and more traditional venture firms.

The amount of Boston-area entrepreneurial activity “has really accelerated in the last couple years,” Lord says, and is moving “to a different stage.” Specifically, he says, there are now more seed-stage companies looking for financing, operational mentorship (including help with recruiting employees and acquiring customers), domain expertise, and contacts.

Which is exactly what Launchpad is looking to provide. The combined angel group will continue to focus on small startups in New England that, over time, will need less than $5-10 million in total financing. A pretty broad swath of sectors are fair game for investment: life sciences, information technology (both consumer and business-focused), mobile (including location-based services), Internet (including social technologies), and telecom.

What’s more, Mirabile says, Launchpad investors will not be passive financiers, but rather will serve as “player-coaches.”

This is not a new approach, of course. Mirabile and Lord freely admit their group has a lot of similarities with other angel groups. But one of its defining points, they say, is that it likes to step up and lead investment deals.

I asked why they wanted to consolidate into one group now. Could there be safety in numbers? “We each had the same kind of wish list to react to the market conditions,” Mirabile says. Yet each was getting bogged down in managing deal flow, meetings, and so forth, he explains. “If either of us was going to move the needle,” he says, “we were going to have to work together.”

Mirabile is a lawyer by training who previously served as general counsel and chief financial officer at Iona Technologies (now part of Progress Software). Lord comes from a software engineering and marketing background, having worked at Advanced Visual Systems, Stellar Computer, and Polygen. The two previously worked together to invest in and/or advise startups such as Copiun, Localytics, Pixability, and Zyrra.

Launchpad won’t commit to making a certain number of new investments, but the group plans to look at 30-odd companies a year. About a third of those will proceed to the due diligence stage, and about 20 to 25 percent of the companies that pass muster and are selected to present to the group will score investments. At the same time, Mirabile talked about avoiding being spread too thin and considering “how much can you give a company besides dollars?” But overall the investors sound pretty hopeful.

“We’re very bullish on Boston and the angel opportunity,” Mirabile says. “We’re reacting to where the market is going.”

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com. Follow @gthuang

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