Ms. Gülsüm Çıracı, Startupfon Founding Partner, stated that in order for the startups, whose number has increased recently in Turkey, to move forward correctly, mechanisms should be established through which they can reach investment at all levels.
Startupfon continues to work as the first share-based early-stage investment platform in Turkey that appeals to qualified investors. The company, which was established to bring together the capital needed for the realization of technology initiatives with the support of the masses, is a crowdfunding platform created by an experienced and visionary team in order to discover, mentor and bring together high potential and promising startups with investment. The fund, which will operate between 2020-2024, aims to invest in 10 to 15 new ventures per year. Startupfon has invested in 27 startups so far.
First of all, can you talk about the evolution of Startupfon, its work and reflections on the startup ecosystem?
In fact, we started working in this field in 2016 as an angel investor network. In the period when we were operating as an angel investor network, we primarily aimed to bring potential investors into this ecosystem. In this context, we told businesspeople operating in traditional sectors in industrialized cities of Turkey that ‘Startup investing’ is an alternative investment tool; we provided information on processes such as startup evaluation, investment and negotiation. Until 2019, we invested in approximately 30 startups with angel investors with this profile. However, we identified a few problems while making these investments.
Startupfon aims to be the first investor in technology startups as an investment strategy. The final size of the fund we have established will be 10 million dollars.
The investors new to the ecosystem could not make their investment decisions quickly as they did not know how to evaluate startups. They had to devote a significant amount of time to invest in startups. Since their own work was a priority, they had problems allocating enough time. An angel investor who starts investing in startups needs to invest in the range of 10-15 and manage his portfolio in order to get a meaningful return. Again, there were difficulties in creating a portfolio due to lack of time and lack of knowledge about evaluation.
Because of these problems, the idea of Startupfon was born. Investors were able to access many startups at the same time by participating in the fund while the ones they liked among these startups were given the opportunity to co-invest with the fund. Startupfon is a first in the ecosystem with the joint investment it offers. The fund, which will reach a size of 10 million dollars currently, has been closed for the first time and three investments have been made.
What are the near-term goals of Startupfon? How much investment and how many entrepreneurs do you aim to reach?
As an investment strategy, Startupfon aims to be the first investor in technology startups. In this sense, we can say that it is a seed investor and will invest at an early stage. The final size of the fund we have established will be 10 million dollars. In this sense, it is aimed to be an investor in 45-50 startups during the investment period. Our investment area can be all startups operating in the field of technology, we do not have a specific vertical. Our criteria are to have a workable product, to have a goal of going global, and of course, the most important thing is that the team that implements is a competent and passionate one.
What kind of network does Startupfon currently have in Turkey? Do you have goals such as expanding abroad and being a part of a global ecosystem?
Startupfon is a platform that currently has over 1,500 member investors from 55 different cities of Turkey. We plan to obtain a ‘crowdfunding license’ from the CMB in the coming period. With the fund we have established, we aim to enable the investors on the platform to make joint investments. Later on, we aim to establish and expand the same model abroad, especially in Europe. From these perspectives, we position ourselves as a FinTech startup. At the end of the day, we plan to reach a structure where investors can become members online and investment processes in startups are completely online.
You are one of the few women in the industry to manage funds. From this perspective, how does Startupfon support women entrepreneurs?
Unfortunately, the number of women in the ecosystem, especially in fund management, is quite low. This is not just fund management, we see that gender is not evenly distributed in many areas of business life. Of course, women entrepreneurs are very valuable to us, but we pay attention to their gender independence when evaluating. It is not the gender of the entrepreneur that matters; we can say their passion for work and competencies. In this sense, we must admit that we are a little happier when there are women among the entrepreneurs who meet our criteria.
In a healthy ecosystem, it is necessary to establish mechanisms where entrepreneurs can reach investment at all levels.
The reports show that digitalization and online working life will make women stronger. Do you think this concept can make the passive structure of women active in the entrepreneurship ecosystem?
Based on my personal observation, I can tell that online working life is more difficult for women. While working from home, women have to deal more with responsibilities such as child care and housekeeping at the same time. Thinking that women’s organizational skills will come to the fore in this sense, their more efficient work may lead to good results in entrepreneurship or business life since they can plan faster when working online than men. As I have said, I just want to express my own personal opinion as I do not have a grasp of the subject.
So, are the startup ecosystem and investment network and angel funds generally at a sufficient level in Turkey?
We can say that the appetite for investment in startups has been increasing in Turkey, especially in 2020 and 2021. But we still cannot claim that there are enough investment institutions or investors. When we look at the last two years, we see a rapidly increasing graph, especially on the investment part. For this reason, we believe that the number of investors and investment volumes will increase in a short time, even if they are not sufficient at the moment.
Of course, at this point, the investment volume is as important as the number of investors. In a healthy ecosystem, it is necessary to establish mechanisms where entrepreneurs can reach investment at all levels such as seed, early stage, growth stage.
Do you think the entrepreneurial ecosystem to be developed in Turkey will be an important threshold for re-attracting foreign investors to the country?
Geography may not be very important for foreign investors as startups operate in a global world by nature. With the emergence of exciting startups in Turkey recently, the number of foreign investors has increased significantly. I believe this situation will continue to increase.
Finally, how will the online order of life and rapid advancement in technology change the workflow?
I think the pandemic was the fast-forward button of the world in terms of technology. It showed that we can do what we traditionally do in many fields with the same efficiency on online platforms. I believe this situation will be permanent. In particular, corporate companies have started to adopt the innovative products of startups to their businesses.
This shows that the gap between corporate and entrepreneurship is gradually closing and the culture of working together will take its place. On the other hand, the new generation prefers to start a business instead of finding a job. As the number of entrepreneurs increases, we will begin to see the added value of issues such as employment and development.
“Entrepreneurship is to Produce Innovative Solutions by its Nature”
Entrepreneurship, especially eco-entrepreneurship, is seen as a catalyst for social, environmental and cultural corruption and it is stated that the solution to many problems will come from the entrepreneurship ecosystem, especially during the pandemic, the solutions to many problems came from startups and technoparks. Entrepreneurship, by its nature, is to produce innovative solutions. I think that the solutions of entrepreneurs for climate change and a more ecological world will turn into action in a shorter time and faster.