Tim Draper invests in SmartGateVC

Feb 17, 2018
4 min read

From left: Ashot Arzumanyan (SmartGateVC), Tim Draper (DFJ, Draper Associates, Draper University), Hambardzum Kaghketsyan (SmartGateVC), Asra Nadeem (Draper University)

From left: Ashot Arzumanyan (SmartGateVC), Tim Draper (DFJ, Draper Associates, Draper University), Hambardzum Kaghketsyan (SmartGateVC), Asra Nadeem (Draper University)

"If you want to succeed you should strike out on new paths,rather than travel the worn paths of accepted success."

John D. Rockefeller

In 2014, Tim Draper of DFJ, one of the first investors in Skype, Hotmail and Tesla, made an unbelievable prediction then of bitcoin price growing to $10K in 3 years. Recently he wrote a book about being a Startup Hero, where he introduced the values and culture of his venture capital career and what the fundamentals of successful startup founder and human being should be from his perspective.

The more you try new things, the more chances you have to succeed” Tim says in his book. At the same time last few years were unusually intense in Armenia, a tiny country in Eastern Europe, which once was known to be the Silicon Valley of the Soviet Union. Armenia is a new rising star of tech entrepreneurship targeting to be one of the top among next generation technology hubs. The Cold War left a heritage of leadership in chips design, defense electronics and nuclear energy. Modern educational programs launching in top universities, presence of multinational companies, and inspiring developments in setting up cutting edge research in fields of AI, quantum computing and other gives rise to a competitive talent pool and potentially a promising pipeline of science-driven startups. Companies like Picsart, Teamable, SoloLearn, Codefights, attracted capital from VCs like Sequoia, True Ventures, Sutter Hill Ventures, e.ventures, DCM, Learn Capital, and the exits included acquisitions by Oracle, CISCO, Synopsys, Moody’s etc.

2018 starts with a new and bright page for Armenia. Tim Draper noticed the emerging opportunities evolving from here and we are delighted to announce investment from Tim.

Back in 2012 Tim initiated Draper University of Superheroes to ignite entrepreneurial spirit in people who would spread entrepreneurship and freedom around the world. In 2015, Hambardzum Kaghketsyan, then a startup entrepreneur from Armenia entered Draper University. That decision changed his life. Eventually Hambardzum, together with his friends Vazgen Hakobjanyan and Ashot Arzumanyan launched SmartGateVC – the fund for superheroes – Silicon Valley micro vc focusing on AI, Security and IoT that sources pipeline primarily from Armenia. The key focus of the fund is on spreading an entrepreneur-friendly startup culture through hands-on and methodical participation in business development.

Draper University is a unique place. We believe in our students and support them in their initiatives. We also believe that our graduates will spread the Draper University culture around the world and make the world better. Investment in SmartGateVC represents my confidence in one of my students and what he plans to do for the Armenian ecosystem together with his team and the entrepreneurs around him“ - says Tim Draper.

"We are excited as hell to be backed by Tim. We believe this is a life-changing event not only for us but also Armenian ecosystem. Today, the Draper Venture Network covers over 60 cities around the world, with $1,8 billion collective assets under management in more than 500 portfolio companies. Tim’s investment in SmartGateVC brings Armenia’s founders one huge step closer to this" - says Hambardzum Kaghketsyan.

SmartGateVC is located in the Hero House - a co-working space designed in the spirit of Draper’s Startup Hero culture and atmosphere. "We are going to share with the DU family our lessons learned and think of a concept of having such Houses in many countries (Hero City and University in Silicon Valley, while many Hero Houses run and supported by DU alumni in different parts of the world). I believe Tim’s Startup Hero concept, defined in his book, has a lot of value to be spread to the world" - says Hambardzum.

The challenges and prospects

7 years ago I went to Silicon Valley, spent a month living in a hostel and doing my startup and came back with a dream. I was dreaming of building great companies and research institutions, of bright people developing bright companies that are changing the humankind to good, like SpaceX, Tesla, Facebook and Google, helping redefine mankind at scale. I dreamed of diverse community of founders, scientists and investors, that are friends. Today, I am excited to be a founding advisor in a fund that will make this happen" - says Vazgen Hakobjanyan.

"We have an amazing pipeline of companies that we are happy to back and work with. We believe in teams. We look for technically excellent and capable teams, teams that are unstoppable and unbreakable" - says Ashot Arzumanyan.

The fund’s focus is primarily on AI, Security and IoT, and the first bets include XCloud Networks - a next generation network infrastructure service for carriers, data centers and backbone operators (currently routing bits for their clients’ 25M+ active users), and 2Hz - a real time voice noise reduction with advanced machine learning and signal processing technologies (an amazing prototype is ready): imagine you call from a noisy bar, and your conversation is clear with NO background noise.

As a fund we are a startup ourselves. We are happy to receive the backing of our advisors and mentors” - says Ashot Arzumanyan. Along with Tim Draper the Fund is backed by network of entrepreneurs and technologists from East and West Coast, Europe and the Middle East.

About SmartGateVC

SmartGateVC is a micro vc with target size of $3m and ticket size of up to $100k investing in pre-seed companies in AI, Security and IoT.