Meet the Investor: Toro Orero, DraperDarkFlow

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“We fund the stars and let them fly.”

That’s the policy of Silicon Valley-based VC firm DraperDarkFlow, according to its managing partner Toro Orero.

Backed by Tim Draper, also founder of VC firm DFJ, whose portfolio includes the likes of Twitter, Skype, SpaceX, Baidu and Tesla, DraperDarkFlow is for African startups that can change the world.

“We invest in startups that can be locally relevant but globally scalable. We are huge fans of startups that can scale globally, just like Twitter and Skype have done. We invest at the early stage, and plug them to mentors, scale and follow-on funding through our deep Silicon Valley network.”

The company made the news earlier this week, partnering 500 Startups to launch SpeedUPAfrica, a four-day bootcamp for 100 of the continent’s most exciting startups that will see the pick of the crop walk away with a share of US$1 million in funding.

But DraperDarkFlow, founded last year, has already been active in Africa. The company has invested in 10 African startups so far, including Tuse, MobileForms, Zagace and Freeda.

As Orero says, the idea is to identify the best startups out there and provide them with the means to succeed.

“We don’t micro-manage, we make the startups aware of the vast resources available at their disposal and they can reach out and make an ask anytime,” he said. “We also connect them with tools, resources, and global exposure.”

SpeedUPAfrica, Orero says, is another way for DraperDarkFlow to add value to startups, even beyond those in its portfolio. More such initiatives are in the pipeline.

“We’re also in the early stages in plans to launch a few accelerators and are currently in talks with some local partners and seeking more local partners across the Africa,” he said.

“We believe in less talk, more action, so SpeedUPAfrica, accelerators, and other projects will be geared under this thesis.”

There is no messing about when it comes to investing in startups.

“We invest as soon as we see a great startup. We’re slowly being known as the guys that make decisions fast. If it’s a no, we don’t bore the founders, we’re upfront with them in that same meeting, no “we’ll get back to you in a few days” language. If it’s a yes, we make the offer on the spot,” said Orero.

The company typically invests between US$100,000 and US$500,000 in each business, although it has done a few smaller investments. Finding startups to invest in generally isn’t a problem.

“Because of our Draper brand, we get tonnes of great referrals from all over the place on a daily basis,” Orero says.

The company is looking for “rockets”, founders that have the ability to scale their startup even if DraperDarkFlow doesn’t invest in them. Startups seeking investment also need to put in the work, with Orero not interested in investing based on a PowerPoint presentation.

Delusion is also important.

“History’s most iconic people have some level of delusion, a certain level of disconnect with reality, not because they’re mentally disturbed, but because they believe that they are not confined by the same reality as everyone else, and that they have the power to shape it and create new realities,” Orero says.

Though there is a lot of buzz and excitement about the African tech startup scene, Orero says DraperDarkFlow tends not to get carried away by the hype.

“We know that there’s a lot of work to be done. Our job is to roll up our sleeves and do the work so that we can add more substance to the excitement,” he said. “I think we will start getting excited when we see more than 10 tech startups exits at over US$100 million in one calendar year.”

Revolutionary, game changing ideas are what the company is after.

“There’s actually no magic formula for startup success, but there are some basic rules. While an OK strategy may be to see what has worked in the developed countries and replicate them in these markets, we’d love to see more and more original unique ideas that can change the world,” Orero said.

“We at Draper are here now, so startups are free to think wild, freely, unrestrained, and think of the impossible. Those are the ideas we love because we have seen that the word “impossible” is relative.”

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Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.

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