Dallas’s Aristos Aims to Micro-Size Investment for Tech Startups

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the mix. I don’t want the portfolio to be concentrated. If there’s a downturn for any reason, I don’t want it to affect the entire portfolio. I want to focus on Texas and surrounding Texas. Most of my connections are in the North Texas area. We see a lot of Austin deals as well. When it comes down to it, it’s software: different flavors of software.

X: How would you describe the North Texas startup scene right now?

F.M.: It’s great. We have a lot of these accelerators. About 20 to 25 percent of the companies that I see are coming out of those accelerators like Tech Wildcatters or Collide Village. These programs are really good for building community awareness. We wait for (the startups) to go through the program and see if they survive the first couple of months, see if they’re going to do what they say they’re going to do.

X: It used to be that startups, once successful, would have to relocate to either Silicon Valley or Boston because that’s where the critical mass was, the money was. How is Texas doing in creating its own startup ecosystem?

F.M.: It’s definitely true, though I think there’s less of a brain drain now. With coast money, one of the stipulations has been they have to move out there. And they did, because that’s where the money was. It’s always been surprising to me that there hasn’t been more money invested in startups in the North Texas region. MetroPCS was a company that started here in Dallas. It had money from the coast and Silver Creek. It went IPO and got bought by T-Mobile. There is some of that money staying around. With the IT expertise and some of the semiconductor and networking companies around, I’m surprised there aren’t more of those types of companies being started.

One argument I heard (why Dallas doesn’t have a stronger ecosystem) is that Dallas is a lot more spread out. There’s not a Sand Hill Road that builds community with a tighter geography. But the new accelerators and co-working spaces we have now are definitely improving on that.

There is definitely a lot of money here, and a lot of oil money. Historically, oil and technology have been inversely correlated which would seem to balance the holdings but it’s amazing how oil and gas really just wants to stay in oil and gas. But we’re at an interesting inflection point with accelerators and co-working spaces, the micro VC model, and just perhaps a change in where people are putting in money. It’s a good time to start a tech company, at least I think so.

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