Tom Hirschfeld on Investing, Co-Leading, and Joining the Board of ProSentry

How did you meet New York Angels, and why did you decide to join?

I had the good fortune to sit next to Elaine Gilde at a dinner event.  While I had already been engaged in angel investing independently for about seven years, I was intrigued as Elaine shared her insights on New York Angels. She described it as a wonderful group of people with deep expertise, diverse professional backgrounds, and a strong sense of collegiality. It all turned out to be true.

What has been your most memorable experience as a New York Angel?

It’s been an incredible journey so far with a company called ProSentry.  Steven Temares initially introduced me to the company, and we both recognized its strong potential and brought it to New York Angels. Michael Costa stepped up to co-lead with me, while Tom Blum provided invaluable expertise during due diligence.

Many members actively engaged in the process, asking insightful questions and contributing meaningfully throughout the investment process. As a result, we ended up leading a $2.5 million round – with over $1 million coming from NYA members, including contributions from the Fund. When we invested last March, ProSentry had minimal revenue. Since then, we’ve facilitated relationships with two of our sponsors (Withum and Insperity), and this January, the company celebrated its first $1 million sales month.  Much of this success stems from the collective value we’ve provided as a group. NYA members have made key introductions, offered strategic guidance, and provided substantial support. I also had the opportunity to join their board. ProSentry has found working with us to be a highly positive experience, and I feel the same way.

What do you look for when you are investing in a company?

I look for a wonderful, committed management team solving a hard problem – one so challenging that others are unlikely to solve it so well. That problem should also be big, and the company should have a unique and viable solution. I also look for a management team that can tell a story that is both realistic and compelling about how they will become a large company by solving this problem.

What do founders appreciate most about working with you?

I think founders appreciate that I have both operating and board experience, plus a strong financial background in raising and investing capital. When they have questions, I try to respond quickly and constructively. They also value the fact that, through New York Angels and other affiliations, I have an extensive network that can help them connect with customers, partners, potential employees, and other investors.

What advice would you give founders starting to fundraise?

Founders should put themselves in the investors’ shoes. Angel investors are looking for a reasonable path to a 10x to 20x return. Founders need to assess whether they can realistically offer that, and if so, they must present a compelling, well-supported plan that makes investors feel comfortable and confident in their vision.

What differentiates companies that you see at Screening versus those who make it through to Due Diligence?

The companies that make it all the way through to due diligence are those that can tell their story in a way that is both understandable and intellectually rigorous. They can clearly articulate the special value that only they can add to a particular problem or industry.

When you look at your past investments, what do you think is most critical for founders to be able to deliver a successful exit?

The only way to success is through failure. Founders who can fail forward – learning from mistakes, pivoting when necessary, and staying resilient – are the ones who ultimately succeed.

What expertise do you bring to New York Angels?

I have some expertise in healthcare, financial services, and climate tech. I”ve served on over a dozen corporate boards, public and private. Having been Chief Operating Officer of a midsized company for 11 years, I can also understand some of the operational and strategic challenges founders face.

What’s a little-known fact about you that has helped you in your career?

My first experience working with technology was in 1981, when I wrote two books on how to play video games, published by Bantam Books. Those books were quite popular because the games were popular. That experience later helped me realize that a convergence was happening among media, technology, and telecom – an insight that ended up shaping much of my career.

Why should other angel investors consider joining New York Angels?

Being a member of New York Angels has made me a better investor. The quality of due diligence we can mobilize as a group, the strong deal flow we attract, and – most important – the ways we add value to companies after investing all improve the odds for us as investors.

Originally published on NYA