Corrections or additions?
This article by Kathleen McGinn Spring was prepared for the
February 12, 2003 edition of U.S. 1 Newspaper. All rights reserved.
Convincing an Angel To Keep the Faith
Susan Pirog is an angel who works at an angel-funded
start-up. As such, Pirog — sales and marketing director for the
Forrestal Village-based Swift Response — has a few things to say
about how to attract angel backers.
On Wednesday, February 19, at 4 p.m. Pirog joins a panel discussing
"How to Fund Your Company." The event is sponsored by the
New Jersey Technology Council and is held at the offices of
at 400 Campus Drive in Florham Park. The moderator for the event is
Harper of Silicon Valley Bank, and
Swift Response, for which Pirog has worked for almost two years, was
founded in 1999. The company’s offices are at 116 Village Boulevard,
but the bulk of its employees are in India. The company’s job is
all of those E-mails — 100,000 a month are not unusual — that
companies receive. For now, nearly 80 percent of responses are sent
back via E-mail, and a small percentage are handled by phone, but
a growing part of Swift Response’s business is live Internet chat,
through which a customer’s questions are answered online by a customer
Chandra Venkataramani, the company’s founder, a graduate of Louisiana
Tech who holds an MBA from New York University, started his company,
"during the boom," says Pirog. He relied on angel investors
to fund his company.
Operations were put in place overseas as a cost saving measure.
costs $4 to $5 to answer an E-mail in the United States," says
Pirog. "In India, it’s $1." With corporations receiving
60,000, 100,000 or more E-mails a month, that is no trifling spread.
The reason it is so much less expensive to site customer service
in India, of course, is the cost of labor. The quality of labor is
high, too. India offers a well-educated, polite, English-speaking
workforce, which sees customer service as a high-end career, says
Pirog, who has not yet been to India, is a graduate of Douglass
(Class of 1977), where she studied mathematics. She holds an MBA from
William and Mary. In the heyday of the Internet boom, circa 1998,
she became an angel investor, putting money into one venture that
is booming, and one that went under.
The winner is Red Oak Software, a Mountain Lakes company whose
takes legacy information from mainframes and puts it onto the
"This is a big issue with the insurance and telecom
says Pirog. The company is profitable.
Less successful was TV Objects, a company founded by Andy Goren, whom
Pirog met when the two worked together at Logic Works. The start-up
was built around the development of computer language conversion
"There was some interest," says Pirog. But not enough to keep
the company afloat.
Even with a respectable 1 for 2 angel investing record, Pirog has
had enough of the game, at least for now. She says she feels much
more comfortable with her current strategy of investing with Jim
NJTC Venture Fund. Still, her experience has given her a window into
the world of angel investing — and how start-ups can best
says of the angel network. She made both of her investments with
she knew. Those hoping for angel money need to cultivate contacts
with likely early-stage investors.
than keeping in touch with colleagues with whom you are friendly.
You never who might have an interest in angel investing two, ten,
or twelve years down the road.
at telling which entrepreneurs will make it, which will fail, and
which probably will make it — but not yet. Not without a couple
of interim failures. The difference, she says, often comes down to
experience. The days when a bright youngster with a new Wharton MBA
could attract angel capital are, in most cases, over.
an angel that you have access to other sources of capital can be
case for the market for your technology — and how you plan to
with singed wings. Getting one to commit again is a mixture of
great technology, business savvy — and a bit of serendipity.
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