How Nik Milanovic of This Week in Fintech went from a family and friends newsletter to a $10M venture fund
How Nik Milanovic of This Week in Fintech went from a family and friends newsletter to a $10M venture fund
May 19, 2022
Halle Kaplan-Allen
Nik Milanovic never meant to start a venture fund. When he started his newsletter, This Week in Fintech, in 2019, it was just intended to be an internal email to keep his team at Petal to keep them informed about what was going on in their industry. He knew he had a unique, nuanced perspective on the ways that fintech was evolving, but he never saw it as anything monumental or world-changing. He certainly didn’t anticipate it becoming a full-time job.From the start, Nik has focused on building resources that didn’t previously exist for the people who were asking for them. In 2019, that was a newsletter. In 2020, it was an investment syndicate. And in 2022, it’s a $10 million venture fund. We sat down with Nik to learn about his first angel investment, his tips for creating leverage as a solo capitalist, and his legendary fintech happy hours.
What was your first angel investment? What motivated you to start investing?
My first angel investment was in 2018 into a company called Truebird that was building mechanical coffee machines.
The thing about working in startups is that you end up putting all of your time, energy, and focus into one bet. But I wanted to see what other companies’ stories were like and support other founding teams. There are so many great products out there. It was never really about the money, I just wanted to connect with other people working on cool things.
When did you start investing in fintech?
I started a syndicate to invest in fintech in May 2020 and everything took off from there. At the time, I had just transitioned from leading strategy for Petal to working at Google Pay — I’ve always worked in fintech so I’m kind of biased, but there are so many interesting products being built and so many smart people are flocking to the space to build them. Focusing on fintech gives me the best opportunity to connect with smart entrepreneurs and actually be able to speak their language.
What was your process for finding LPs to join your syndicate?
It was a lot of outreach to people I already knew, asking if they wanted to collaborate on angel investing. We didn’t do much to promote it publicly at first, it was pretty private. But there were a lot of word of mouth referrals, and that’s gotten us to over 150 members now. People were just excited about the companies we were investing in and wanted to tell their friends.
That’s impressive growth. Why do LPs love the community you’ve built?
People like collaborating with each other. Of course, they like meeting the entrepreneurs and getting into buzzy rounds, and they get excited when those rounds get followed-on by larger VCs. But more than that, people like reviewing new concepts and then having collaborative conversations about why products are being built and why now is the right time for them to go to market. Whenever we’re reviewing a new company, it’s a highly collaborative process of putting together questions that will challenge the founders and then sharing notes before making an investment decision. Most people in the community work in fintech, but everyone is coming to the conversation with a different perspective, different experiences, and different skill sets — so the conversations that end up happening are really rewarding.
It sounds like a lot of work managing all those conversations between 150 people. What are your tips and tricks for getting the most value out of your investor network as a solo capitalist?
I’m definitely feeling the brunt of it right now after just announcing the Fintech Fund. My inbox is a nightmare. I don’t have any real hacks, but I try to focus on clear communication and transparency over everything else. I find that the more information I share openly with my community, the more people offer to help out with various tasks, organizing events, and supporting portfolio founders.
Finding the right tech stack to enable that communication and transparency has been a huge unlock. We’re using Slack for communication amongst community members, and then obviously Sydecar. It makes it easy for our syndicate members to see what we’re doing, how we’re investing, and what their participation looks like.
What drove your decision to go from syndicating deals to raising and fund and becoming a full time investor?
This opportunity — to invest in the types of companies that we’re investing in, in the places that we’re investing — is massive and the traditional venture model doesn’t do it justice. At the earliest stage, the support that early stage companies need is about so much more than the dollars. There aren’t a lot of options out there to get the support of a massive fintech community like ours that can give you firsthand advice, help you choose between two vendors, or introduce you to your first product hire. Raising a fund will allow us to bring that value to a greater number of founding teams.
What challenges have you faced in the move from syndicating deals with other angels to raising a fund backed by larger funds and institutional LPs?
It’s a different ball game. The expectations are higher around communications, structuring deals, and showing returns. I’m so appreciative of our early backers — people like Sheel Mohnot, Jake Gibson, Jillian Williams, Sriram Krishnan, Stephany Kirkpatrick, and Mike Dudas — they’ve been phenomenally supportive in making this dream a reality. But it’s definitely a more formalized relationship and so having my ducks in a row on things like compliance, tax, and other back office functions is a non-negotiable.
The Fintech Fund’s website says that you invest in defi — what is your approach to investing in crytpo or defi companies and how does it differ from other fintech investments?
We really want the investments we make out of this fund to be grounded in real use cases that are immediately available. There are a lot of great teams out there building for possible, eventual use cases in newer, unproven fields. The right partners for them are ones that have the right risk-tolerance and are excited to back more speculative concepts. For us, we want to prioritize delivering a good and fast return to our LPs. There is some crypto and web3 in the fund, but for the most part, we’re focused on products that have an immediate use case (and active customers) today.
What does your diligence process look like for that? Are you talking to potential customers or subject matter experts?
The community is instrumental in our diligence process. The beauty of what we’ve built is that we don’t often have to go outside of our own community to find someone who has experience in a certain niche of fintech, or who has been a customer of a competitor product. Getting feedback from people who know a space better than I do is so important — it’s not something that I have an ego about.
What gives your community a competitive edge?
I think our happy hours are what makes us really unique. Organizing events all over the world is exhausting, events don’t often have a super high ROI for fundraising or sourcing deals — at least not directly. But everything we do is about building this community, and we heard from the community that people were really missing in-person connection. There’s a lot of serendipity and nuance in in-person events that can’t be captured online.
Nik Milanovic never meant to start a venture fund. When he started his newsletter, This Week in Fintech, in 2019, it was just intended to be an internal email to keep his team at Petal to keep them informed about what was going on in their industry. He knew he had a unique, nuanced perspective on the ways that fintech was evolving, but he never saw it as anything monumental or world-changing. He certainly didn’t anticipate it becoming a full-time job.From the start, Nik has focused on building resources that didn’t previously exist for the people who were asking for them. In 2019, that was a newsletter. In 2020, it was an investment syndicate. And in 2022, it’s a $10 million venture fund. We sat down with Nik to learn about his first angel investment, his tips for creating leverage as a solo capitalist, and his legendary fintech happy hours.
What was your first angel investment? What motivated you to start investing?
My first angel investment was in 2018 into a company called Truebird that was building mechanical coffee machines.
The thing about working in startups is that you end up putting all of your time, energy, and focus into one bet. But I wanted to see what other companies’ stories were like and support other founding teams. There are so many great products out there. It was never really about the money, I just wanted to connect with other people working on cool things.
When did you start investing in fintech?
I started a syndicate to invest in fintech in May 2020 and everything took off from there. At the time, I had just transitioned from leading strategy for Petal to working at Google Pay — I’ve always worked in fintech so I’m kind of biased, but there are so many interesting products being built and so many smart people are flocking to the space to build them. Focusing on fintech gives me the best opportunity to connect with smart entrepreneurs and actually be able to speak their language.
What was your process for finding LPs to join your syndicate?
It was a lot of outreach to people I already knew, asking if they wanted to collaborate on angel investing. We didn’t do much to promote it publicly at first, it was pretty private. But there were a lot of word of mouth referrals, and that’s gotten us to over 150 members now. People were just excited about the companies we were investing in and wanted to tell their friends.
That’s impressive growth. Why do LPs love the community you’ve built?
People like collaborating with each other. Of course, they like meeting the entrepreneurs and getting into buzzy rounds, and they get excited when those rounds get followed-on by larger VCs. But more than that, people like reviewing new concepts and then having collaborative conversations about why products are being built and why now is the right time for them to go to market. Whenever we’re reviewing a new company, it’s a highly collaborative process of putting together questions that will challenge the founders and then sharing notes before making an investment decision. Most people in the community work in fintech, but everyone is coming to the conversation with a different perspective, different experiences, and different skill sets — so the conversations that end up happening are really rewarding.
It sounds like a lot of work managing all those conversations between 150 people. What are your tips and tricks for getting the most value out of your investor network as a solo capitalist?
I’m definitely feeling the brunt of it right now after just announcing the Fintech Fund. My inbox is a nightmare. I don’t have any real hacks, but I try to focus on clear communication and transparency over everything else. I find that the more information I share openly with my community, the more people offer to help out with various tasks, organizing events, and supporting portfolio founders.
Finding the right tech stack to enable that communication and transparency has been a huge unlock. We’re using Slack for communication amongst community members, and then obviously Sydecar. It makes it easy for our syndicate members to see what we’re doing, how we’re investing, and what their participation looks like.
What drove your decision to go from syndicating deals to raising and fund and becoming a full time investor?
This opportunity — to invest in the types of companies that we’re investing in, in the places that we’re investing — is massive and the traditional venture model doesn’t do it justice. At the earliest stage, the support that early stage companies need is about so much more than the dollars. There aren’t a lot of options out there to get the support of a massive fintech community like ours that can give you firsthand advice, help you choose between two vendors, or introduce you to your first product hire. Raising a fund will allow us to bring that value to a greater number of founding teams.
What challenges have you faced in the move from syndicating deals with other angels to raising a fund backed by larger funds and institutional LPs?
It’s a different ball game. The expectations are higher around communications, structuring deals, and showing returns. I’m so appreciative of our early backers — people like Sheel Mohnot, Jake Gibson, Jillian Williams, Sriram Krishnan, Stephany Kirkpatrick, and Mike Dudas — they’ve been phenomenally supportive in making this dream a reality. But it’s definitely a more formalized relationship and so having my ducks in a row on things like compliance, tax, and other back office functions is a non-negotiable.
The Fintech Fund’s website says that you invest in defi — what is your approach to investing in crytpo or defi companies and how does it differ from other fintech investments?
We really want the investments we make out of this fund to be grounded in real use cases that are immediately available. There are a lot of great teams out there building for possible, eventual use cases in newer, unproven fields. The right partners for them are ones that have the right risk-tolerance and are excited to back more speculative concepts. For us, we want to prioritize delivering a good and fast return to our LPs. There is some crypto and web3 in the fund, but for the most part, we’re focused on products that have an immediate use case (and active customers) today.
What does your diligence process look like for that? Are you talking to potential customers or subject matter experts?
The community is instrumental in our diligence process. The beauty of what we’ve built is that we don’t often have to go outside of our own community to find someone who has experience in a certain niche of fintech, or who has been a customer of a competitor product. Getting feedback from people who know a space better than I do is so important — it’s not something that I have an ego about.
What gives your community a competitive edge?
I think our happy hours are what makes us really unique. Organizing events all over the world is exhausting, events don’t often have a super high ROI for fundraising or sourcing deals — at least not directly. But everything we do is about building this community, and we heard from the community that people were really missing in-person connection. There’s a lot of serendipity and nuance in in-person events that can’t be captured online.
Nik Milanovic never meant to start a venture fund. When he started his newsletter, This Week in Fintech, in 2019, it was just intended to be an internal email to keep his team at Petal to keep them informed about what was going on in their industry. He knew he had a unique, nuanced perspective on the ways that fintech was evolving, but he never saw it as anything monumental or world-changing. He certainly didn’t anticipate it becoming a full-time job.From the start, Nik has focused on building resources that didn’t previously exist for the people who were asking for them. In 2019, that was a newsletter. In 2020, it was an investment syndicate. And in 2022, it’s a $10 million venture fund. We sat down with Nik to learn about his first angel investment, his tips for creating leverage as a solo capitalist, and his legendary fintech happy hours.
What was your first angel investment? What motivated you to start investing?
My first angel investment was in 2018 into a company called Truebird that was building mechanical coffee machines.
The thing about working in startups is that you end up putting all of your time, energy, and focus into one bet. But I wanted to see what other companies’ stories were like and support other founding teams. There are so many great products out there. It was never really about the money, I just wanted to connect with other people working on cool things.
When did you start investing in fintech?
I started a syndicate to invest in fintech in May 2020 and everything took off from there. At the time, I had just transitioned from leading strategy for Petal to working at Google Pay — I’ve always worked in fintech so I’m kind of biased, but there are so many interesting products being built and so many smart people are flocking to the space to build them. Focusing on fintech gives me the best opportunity to connect with smart entrepreneurs and actually be able to speak their language.
What was your process for finding LPs to join your syndicate?
It was a lot of outreach to people I already knew, asking if they wanted to collaborate on angel investing. We didn’t do much to promote it publicly at first, it was pretty private. But there were a lot of word of mouth referrals, and that’s gotten us to over 150 members now. People were just excited about the companies we were investing in and wanted to tell their friends.
That’s impressive growth. Why do LPs love the community you’ve built?
People like collaborating with each other. Of course, they like meeting the entrepreneurs and getting into buzzy rounds, and they get excited when those rounds get followed-on by larger VCs. But more than that, people like reviewing new concepts and then having collaborative conversations about why products are being built and why now is the right time for them to go to market. Whenever we’re reviewing a new company, it’s a highly collaborative process of putting together questions that will challenge the founders and then sharing notes before making an investment decision. Most people in the community work in fintech, but everyone is coming to the conversation with a different perspective, different experiences, and different skill sets — so the conversations that end up happening are really rewarding.
It sounds like a lot of work managing all those conversations between 150 people. What are your tips and tricks for getting the most value out of your investor network as a solo capitalist?
I’m definitely feeling the brunt of it right now after just announcing the Fintech Fund. My inbox is a nightmare. I don’t have any real hacks, but I try to focus on clear communication and transparency over everything else. I find that the more information I share openly with my community, the more people offer to help out with various tasks, organizing events, and supporting portfolio founders.
Finding the right tech stack to enable that communication and transparency has been a huge unlock. We’re using Slack for communication amongst community members, and then obviously Sydecar. It makes it easy for our syndicate members to see what we’re doing, how we’re investing, and what their participation looks like.
What drove your decision to go from syndicating deals to raising and fund and becoming a full time investor?
This opportunity — to invest in the types of companies that we’re investing in, in the places that we’re investing — is massive and the traditional venture model doesn’t do it justice. At the earliest stage, the support that early stage companies need is about so much more than the dollars. There aren’t a lot of options out there to get the support of a massive fintech community like ours that can give you firsthand advice, help you choose between two vendors, or introduce you to your first product hire. Raising a fund will allow us to bring that value to a greater number of founding teams.
What challenges have you faced in the move from syndicating deals with other angels to raising a fund backed by larger funds and institutional LPs?
It’s a different ball game. The expectations are higher around communications, structuring deals, and showing returns. I’m so appreciative of our early backers — people like Sheel Mohnot, Jake Gibson, Jillian Williams, Sriram Krishnan, Stephany Kirkpatrick, and Mike Dudas — they’ve been phenomenally supportive in making this dream a reality. But it’s definitely a more formalized relationship and so having my ducks in a row on things like compliance, tax, and other back office functions is a non-negotiable.
The Fintech Fund’s website says that you invest in defi — what is your approach to investing in crytpo or defi companies and how does it differ from other fintech investments?
We really want the investments we make out of this fund to be grounded in real use cases that are immediately available. There are a lot of great teams out there building for possible, eventual use cases in newer, unproven fields. The right partners for them are ones that have the right risk-tolerance and are excited to back more speculative concepts. For us, we want to prioritize delivering a good and fast return to our LPs. There is some crypto and web3 in the fund, but for the most part, we’re focused on products that have an immediate use case (and active customers) today.
What does your diligence process look like for that? Are you talking to potential customers or subject matter experts?
The community is instrumental in our diligence process. The beauty of what we’ve built is that we don’t often have to go outside of our own community to find someone who has experience in a certain niche of fintech, or who has been a customer of a competitor product. Getting feedback from people who know a space better than I do is so important — it’s not something that I have an ego about.
What gives your community a competitive edge?
I think our happy hours are what makes us really unique. Organizing events all over the world is exhausting, events don’t often have a super high ROI for fundraising or sourcing deals — at least not directly. But everything we do is about building this community, and we heard from the community that people were really missing in-person connection. There’s a lot of serendipity and nuance in in-person events that can’t be captured online.
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