David Chang and Shereen Shermak first met during a business meeting at Goldman Sachs. Now husband and wife, and each with an impressive track record of success, the duo is advising and making angel investments in early stage companies here in Boston.
Chang’s background spans roles at many of Boston’s tech-mafia companies: eDocs ($115M exit in 2004), TripAdvisor (acquired by InterActiveCorp in 2004 for $200M), m-Qube (sold to Verisign for $250M in 2006), and Mobicious (which he co-founded and sold to Exclaim Mobility this August). His career ranges from developer roles to product management, product marketing and overall marketing for B2C and B2B startups alike.
Shermak began her career consulting to startups, then moved into managing operations at State Street and product management at Fidelity. She has over fifteen years of consulting and management experience, along the way co-founding Salem-based custom ecommerce site, FashionPlaytes. Today she’s bridging her startup and financial services company expertise by helping build Currensee, part of the next wave of financial services companies.
The couple evaluated over twenty-five early stage startups in Boston in 2009, and has made one investment to date. The capital comes from their personal funds, and they’ve recently connected with a network of other investors here in Boston in similar situations (and who may combine forces in order to share leads, pool resources, or place us in advisors roles at startups).
Value-Add Investing
When making an investment, Chang and Shermak bring a range of deep industry expertise: from travel to financial services to mobile. Their domain knowledge across these industries complement each other, from marketing to strategy, and with the common overlap being product expertise.
But what makes their value-add to early stage entrepreneurs even more meaningful is that they’ve lived it before, with experience in operating roles at some of the most well known startups here in Boston. Their great networks also makes them attractive to entrepreneurs.
“Since we invest in companies that play in markets where one of us has very deep experience, we’re able to quickly jump in and accelerate the development of the business. … We also connect founders with contacts in our networks in order to introduce them to subject-matter-experts, relevant industry contacts, potential employees, and prospective later-stage investor”
With regard to their level of involvement with the startups they invest in, the couple says it can range from hands-off to extremely hands-on and depends in most cases on how experienced the founder is.
Investment Interests & Approach
In terms of sourcing investments, Chang and Shermak source investments from their networks (prior colleagues and former classmates at MIT, Harvard, Duke and Cornell starting their own or introducing them to new ventures), the venture capital community (who frequently introduce them to early stage companies seeking advice or capital), or entrepreneurs themselves who seek the one of them out based on their domain knowledge or past startup experience.
When they look at prospective investments they are able to advise and examine different aspects of the business. “Shereen’s expertise lies in product, strategy and financial modeling, which enables her to quickly assess opportunities to identify strengths and weaknesses,” Chang shared. “My expertise lies in product, technical and marketing, which enables me to identify ways to grow the business, acquire and retain customers.”
Given their background and Boston being a hot zone for mobile and financial services innovation, Chang and Shermak are investment interest leans where one of them has direct operational experience and industry contacts. “Startups at the intersection of multiple areas of our expertise are particularly interesting,” Chang said. “In the past year, several startups in the mobile and travel space have suddenly gained traction.”
In terms of stage of company, they are most interested in very early stage startups — even those with just a business plan. “Unlike many VCs, we don’t shy away from first-time entrepreneurs,” Chang said.
Their first investment is xPeerient, an online service aiming to change the way that CIOs buy and sell technology. The couple invested alongside Kevin Laracey (formerly of Sigma Partners) and Roy Rodenstein (Hacker Angels). The company has since raised a Series A.
Thank you to David and Shereen for sharing their investment focus and approach with the Bostinno community, and becoming another early-stage resource for area entrepreneurs looking to take their ideas and products to the next level.
