In the fast-paced world of entrepreneurship, finding the right investors can often feel like an insurmountable challenge. But for co-founders Jaclyn Johnson and Angeline Vuong, the struggle served as the inspiration for their startup idea: Cherub, a marketplace that pairs angel investors with ambitious entrepreneurs.
With Vuong’s five years of experience in product and growth at Opendoor, and Johnson’s success as the founder of Create & Cultivate, they understood the complexities of both sides of the investing world. Johnson not only sold her own startup in 2016, but also invested in multiple companies, including luggage brand Away.
Comparing Cherub to the exclusive dating app Raya, Johnson explains, “You can go to this platform as an entrepreneur and connect with angel investors based on your preferences.” By utilizing tags, entrepreneurs can easily find potential investors who align with their specific needs and interests.
“So for instance, if I go on the app and I’m interested in women-owned businesses in the CPG space doing their Series A or something specific, I’ll get surfaced deal flow that is the highest match to what I’m looking for.”
But Cherub works both ways. Investors can also see who is interested in them, and if the feeling is mutual, they can express their interest and make a match. If not, they can reject the invitation to connect. This ensures that the platform is efficient and effective for both parties.
“We’re sort of using dating app mechanics in a way,” Johnson explains. “So we jokingly call it the Raya for deal flow.”
To test the concept, Johnson and Vuong first launched a newsletter that garnered 1,500 sign-ups within just three weeks. Encouraged by this response, they built out an alpha product last summer, featuring 40 companies and a way for investors to request a deck. Every single one of those companies received requests, and 50% resulted in an introduction. Out of those introductions, 20% ended up getting funded in under three months, collectively raising $1.1 million in capital.
In fact, 40% of those deals came from new angel investors, showing the potential for growth and expansion for both investors and entrepreneurs.
To set itself apart from other platforms that connect angels and entrepreneurs, Cherub has a specific focus on consumer packaged goods (CPG) companies, though they also feature a variety of other industries such as AI and hospitality.
Membership-based, Cherub offers two different tiers of membership. The first, priced at $480 per year, allows founders to list their companies in the directory and access analytics such as how many people have viewed their deck. The second tier, called Cherub Select, costs $950 per year and includes a more vetted process to increase visibility and attract potential investors.
While there are many platforms, like AngelList, that connect investors and entrepreneurs, Cherub sets itself apart in its emphasis on a tailored and social approach to investing.
Angel investor Allen Orr tells TechCrunch, “What appealed to me about Cherub was the idea of a tailored and social approach to investing. I also liked that there are opportunities not just for investment but also advising brands.”
In addition to connecting investors and entrepreneurs, Cherub also helps founders find incubators and accelerators, and has partnerships with notable firms such as Andreessen Horowitz and Dream Ventures.
With a slow launch currently underway, Cherub already has 100 startups on the platform generating revenue of $50,000. And with a waitlist of 1,500 companies, it’s clear that Cherub has identified a real need in the industry.
Founder and CEO of mental health support app Zant, Maggie Rose Macar, attests to the success of Cherub, stating, “I think Cherub does a great job at bringing active investors into the room with founders who are looking.”
To fund the startup, Cherub raised $1.25 million from its own angels, including investors like Drybar’s Alli Webb and Blavity’s Morgan DeBaun.
Rather than simply connecting investors and entrepreneurs, Cherub offers a uniquely tailored and social experience, making it the go-to platform for anyone in the world of angel investing.
