Larry Nelson from w3w3.com has an interview up with my partner Seth Levine. The interview is called Is an Advisory Board or Advisors Really Necessary? but the first half of the interview is about Seth’s view of Foundry Group and his partners (e.g. me, Jason, Ryan, and Chris.) Listen and find out some magic secrets – or just hear what Seth thinks. As a special bonus Seth has some good ideas about advisors and advisory boards.
Over the past few months we’ve been posting about the "themes" we invest in at Foundry Group over on our Foundry Group blog. I thought – with the most recent announcement of our investment in Smith & Tinker (our most recent human computer interaction (HCI) investment) – it was worth reviewing our current themes.
For a view on how we think about themes, start with our post What Is "Thematic Investing?" We then cover four of our current themes:
We also put up a post titled Did Darwin Skip Over Email? explaining our desire to find another investment on our long standing theme around email (and SMTP). We are also continuing to scour the world for RSS-related stuff (yes – we love protocols – ad hoc or otherwise).
While we don’t limit ourselves to only investing in these themes, we rarely wander outside them and will usually only do so with someone we’ve worked with in the past. We are always working on a set of new top secret themes that intrigue us. Some of these will see the light of day; others won’t. In all cases, they keep our brains busy.
Today we announced that Foundry Group has joined the Entrepreneurs Foundation of Colorado. We’ve contributed 1% of our carried interest (the functional equivalent of 1% of our equity) to the Community Trust Endowed Fund of the Community Foundation Serving Boulder County.
When I co-founded the Entrepreneurs Foundation of Colorado (EFCO), we explained what we were trying to accomplish in the post titled Entrepreneurs Foundation of Colorado Encourages Early Stage Giving. Fifteen months later, with the addition of Foundry Group, we now have 19 member companies.
To everyone that has supported and/or participated in EFCO, thank you! If you are a founder or an employee of a Colorado-based company (or venture capital firm) that is interested in participating in EFCO, just drop me an email.
By the time you read this I’ll be in New York (right now I’m on a plane.) If you follow me (or any of my partners) on twitter, you will quickly understand why a Boulder entrepreneur recently referred to twitter as the "Foundry Group location / travel finder."
We travel plenty. My partner Chris Wand just wrote a post titled Is “Geography” a Cliché in Venture Capital? Unlike many VCs who prefer to invest close to home, we view the United States (and Canada) as our oyster. Take a look at Chris’ post to understand why.
For perspective, the geographic distribution of our first six investment is two in the bay area (Zynga, Gnip), two in southern California (Oblong, Memeo), one in Boulder (Lijit), and one in New York (unannounced.) We are in the process of closing an investment in Seattle and our active deal log (stuff we are seriously looking at) covers California, Colorado, New York, North Carolina, and Utah.
Having lived the life of a satellite office for ten years at Mobius Venture Capital (Chris, Seth, and I were in Boulder; everyone else was in the bay area) I can assure you that "being the satellite office" in a venture capital firm ultimately sucks. While it’s fun at first because you think everyone leaves you alone, you eventually end up spending more and more "junk time" at wherever the main office is and you are the one that ultimately has to travel (at some point almost every week) to make sure you are in the flow of things.
When we created Foundry Group, it was important to us that we all be located in Boulder. We’ve always been thematic investors and have gone where our themes took us, rather than being bounded by geography. While flying United out of DIA has its moments, the decision to be located in one place but invest throughout the US is a powerful one for us and the entrepreneurs we back.
The newest blog post up on the Foundry Group web site is titled What Is "Thematic Investing?" In this post, we try to describe more deeply what we mean when we say "we are thematic investors" or "we like horizontal stuff."
"Our themes tend to be horizontal in nature and are often based on an underlying protocol, standard or market trend that we believe is on the cusp of widespread adoption that has the potential to drive a cycle of innovation and company creation for at least a five to ten year period. We try to focus on themes and their underlying technologies that are ready to be rolled out to consumers or the enterprise and are well beyond the science-experiment phase.
To make this concrete, some examples of themes we are excited about presently and historically include email, RSS, the implicit web and human-computer interaction (HCI). Because themes are inherently horizontal, they have often have applications in the consumer and enterprise markets and can be delivered in myriad ways, whether it is via a web site, SaaS, a gadget, an appliance or good old-fashioned downloadable client or server software."
We don’t limit ourselves only to our themes, but we use them to guide much of our thinking. One of the themes we are working on that we don’t cover in the post is called Glue – which is shorthand for "web application infrastructure." Look for more on this from us soon.
<-‘Foundry Group Raises $225 Million Early Stage VC Fund’
If you recognize the syntax above, you’ll recognize the first programming language I ever used.
10 PRINT “Foundry Group Raises $225 Million Early Stage VC Fund”
That would be the second language I coded in.
WriteLn(‘Foundry Group Raises $225 Million Early Stage VC Fund’);
And that would be the third. These three examples are minor derivations of everyone’s first program – also known as “Hello World” – written in APL, Basic, and Pascal for the non-nerds among you.
Last year I co-founded Foundry Group with four partners – Seth Levine, Jason Mendelson, Ryan McIntyre, and Chris Wand. In the fall we closed our first fund – a $225 million fund aimed at funding early stage software and Internet companies in the United States.
We are now officially open for business. We’ve made a few investments which we’ll write about over the next few weeks. In the mean time we want to thank everyone – especially our new limited partners and the many entrepreneurs who we’ve worked with over the years – that have enabled us to be in a position to raise this fund.
Email me at firstname.lastname@example.org
Bonus points to anyone that figures out the last programming language.
I love it when companies I’m an investor in use an acquisition strategy. My good friend and long time co-investor Fred Wilson calls it a "venture rollup." It’s very different than a traditional "rollup" or "consolidation" (which is typically revenue based.) Fred described it really well when talking about NewsGator’s acquisition of FeedDemon in 2005.
When he (Feld) finds a sector where he’s early in the development of the market, he gets in, figures it out, builds a management team, and then gets busy convicing others to join the party. That’s the play book for the venture rollup.
Todd Vernon – Lijit’s CEO – talks about why BigSwerve is important to him. While BigSwerve is a tiny company (the founder Raj Bala and some outsourced developers), they’ve done some very interesting things that address my Dark Matter of the Blogosphere thoughts from last summer.
As a special bonus, if you want to see the magic of Lijit, continue reading. When I started writing this post, I remembered that Fred had coined the phrase "venture rollup" a while ago but I couldn’t remember what post it was on. I went to his site and did a search via Lijit on "venture rollup feld". The first result was the post I wanted. I then went to Google and did "venture rollup feld". No where in sight. I then did "a vc venture rollup feld". Result #4. Lijit wins.
If you have a blog and don’t use Lijit for search, try it and make yourself (and more importantly – your readers – happy. And to those of you out there that want to add to the blogosphere’s dark matter and tell me the period goes inside the quotations, I know – it just looked funny because of the hyperlinks.
We recently made another Foundry Group investment in the Zynga Game Network. Brad Stone wrote a great article about Zynga in the NYTimes about it titled More Than Games, a Net to Snare Social Networkers.
One of my co-investors – Fred Wilson from Union Square Ventures – wrote a nice overview of how he came to make this investment. I vividly remember seeing my long time friend Mark Pincus’ name pop up as the author of Texas Hold’em on Facebook one day over the summer and thinking "hmmm – what’s Mark up to?"
In six months Mark has put together a remarkable company. In our first conversation about Zynga, Mark explained his vision of social gaming to me. I’ve been a long time on and off gamer – I like puzzle and interactive games, but not first person shooters or MMOGs – so the idea of the intersection of casual games and Facebook immediately appealed to me.
I’ve become a complete Scramble addict (remember Boggle?), although my partner Ryan’s wife Katherine continues to cream me regularly. The Zynga games are coming fast and furiously – the current catalog includes Poker, Attack, Blackjack, Battleship, Scramble, Diveman, Triumph, Social Chat, Stickerz, Dopewars, and a bunch of others you’ll be seeing soon.
Zynga isn’t limited to Facebook – the games have now launched on Bebo and Friendster and are coming to other social networks near you in the next few weeks.
Mark is an 100% on the go, non-stop, take no prisoners entrepreneur. In six months, he’s created a game network of over 10 million users and over 700,000 unique players each day. I love working with guys like Mark. And I love that he’s named his company after his dog.
I love when we find magic technology that just does what it is supposed to. That – plus a handful of amazing people – are the underpinnings of the investment we just led in Memeo. My partner Ryan McIntyre – who joined the board – has a detailed post up titled Foundry Group Invests in Memeo.
I’ve been searching for brainless backup and sync software for a long time. I’ve never been happy. I am now. I’m using Memeo to keep five Vista machines (going on seven) in sync and it just automagically happens. Oh – and my server is a Mac – how fun is that?
We did a couple of other investments in Q4 of last year that we’ll be writing about soon, along with what we are up to at Foundry Group. In the meantime, if you use a PC or a Mac and have any digital data on any of your computers that you care about (say photos, music, videos, movies, or even Word docs), give Memeo a try and tell me what you think.