Around this time last year, fintech company Karat Financial put out Supernova, a Shark Tank-y series where founders pitch their companies to a panel of investors–all of whom are YouTubers and TikTokers.
Now, due to the “incredible response” to Supernova, it’s launching an angel investing program that’ll introduce creators interested in investing to companies that want their money.
“The program was built on this insight we had that creators have a need to figure out ways to extend their longevity and their time horizon,” Shubha Raghvendra, Karat’s Head of Product, tells Tubefilter. “What we found is that there was a host of creators out there that, in many cases, have more capital than they know what to do with.”
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Some use that capital to build their own brands (take Feastables, for example, or Chamberlain Coffee, or Prime, or Cloak), but for those who don’t want to run businesses, investing is a long-term way to build wealth, Raghvendra says.
As for what creators bring to companies and their founders, “Creators are really sought-after investors because they have specific expertise,” she adds. They also “come with built-in distribution” in the form of their audiences.
Raghvendra says Karat–which recently raised its own $70 million Series B–has been introducing creators to founders for “a long time,” but considering the response to Supernova, decided to formalize those intros into a program.
With the program, it has a dedicated team who match creators and companies after vetting both of them (though it does warn several times that angel investing is “really risky” and that “[i]f you invest, you’ll most likely lose your money”). Once the intro is made and the creator and company are interested in working together, Karat steps back and lets the two finalize the deal on their own.
It doesn’t take a financial cut of deals, Raghvendra says, and at least for now, it’s not involved in helping to handle any of the deal-sealing paperwork. She says paperwork might be a service Karat considers offering in the future if enough creators express interest.
Raghvendra says Karat chose not to take a cut of deals because it has other services it monetizes from (like its tax and bookkeeping division), and “this is one of things where a rising tide lifts all boats,” she says. “We just want to help the creator ecosystem grow.”
She promises that Karat “will never take any money from this program.”
Since it started formalizing this division, Karat has helped match creators and companies for three deals, it says. (It can’t yet disclose their names.)
Creators who are interested in investing through the program can check it out here.
