Full and detailed dossier on Jerry Neumann, legendary investor.
Hello! Thanks for your question about Jerry Neumann. The short version is that he is a venture investor with over two decades of experience who likes to see hard data and market research behind technological projects and believes a company’s founders are as important as the product.
Below you will find a deep dive of my findings.
A brief business history of technology investor Jerry Neuman:
2001- Along with an outside investor, Neumann acquired Communicade.
2005- Neumann co-founds Root Markets.
2007- After being run successfully for years by Neuman, Communicade is liquidated.
2008- Neu Venture Capital was formed to venture invest in technology.
2012- He was named one of New York City's top early-stage investors by Business Insider.
Jerry Neumann’s beliefs
Roger Ehrenberg in an article for Hackernoon from April 23rd 2017 quotes some lines from Jerry Neumann, where Neumann explains that he believes that anyone can learn to invest in startups, but also that anyone thinking of mastering this skill should be willing to strive to do it right every time, be conscious that mistakes will be made and that, will only provide experience to be a better investor.
In an entry on Neumann's own blog (Reaction Wheel) from October 21st, 2013 called In Praise of the Business Plan, there are several thoughts that he exposes that are worth mentioning. He loves efficiency, building things, setting up analytics, learning, and experimenting.
He gives his opinion on the evolution of the business plan, going from 30 to 15 pages was great in his opinion, but he feels like a lot was lost when the nowadays common practice of leaving the business plan totally on the side and using only a demo became a standard.
Neumann shares his opinion on the value of a product that best demonstrates what it is and what it does by itself, which according to him it’s great, but shouldn’t be a standalone strategy.
For the purposes for which this research is intended, I would like to highlight the following part since it might be particularly useful.
He believes that startups fail because they fail to understand their customer, their competition, and their market, not because they are unable to develop and build their products. Also important is that according to him, although sometimes big, technical risk is the easiest risk to evaluate before investing, hence the importance of writing a business plan.
On August 4th, 2017, Neumann wrote in his blog a post called Betting your Beliefs.
From this post, we can see that when investing, he likes to put time, effort and energy into developing those companies and long-lasting relationships with founders.
He also says that when he invests in a company he does it under the absolute belief that that company will grow to be what the founder envisioned. Later on, he acknowledges that he is also conscious that most of the times he is doomed to be wrong. Either way, Neumann really believes that his involvement helps companies and that regarding startups hard work doesn’t guaranty success by itself, luck plays a big part too.
Most startups won’t succeed and most investors will keep themselves from investing. According to Neumann, at the beginning of a business idea, there are no resources or data to back a claim that profit is entwined in the core of the proposal. In the absence of business proof, Neumann often chooses to believe in the founders.
On July 12 of 2016, Neumann said that he believes that, contrary to virtual reality, augmented reality is a good place to venture invest.
Lastly, regarding Hoboken startup scene, F6S lists 35 companies and Angel.co lists 69 companies and 4,924 investors.
To wrap it up, it could be safely assumed that it would be a good idea when approaching Jerry Neumann to be direct, honest and have solid data to back up any claim. Understanding the market of the product might be important as well.
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