I’m a big fan of Jason Calacanis’ show This Week In Startups. I usually run naked (no headphones) but when I listen to something it’s usually an interview or a book.
Amy and I had dinner last night with Paul Berberian and his wife Renee and Paul mentioned Jason had interviewed him at Techstars FounderCon in Chicago a few weeks ago. So – I grabbed my iPhone, downloaded the interview, and listened to it. Dynamite stuff.
Earlier in the morning I read Jason’s post on LinkedIn titled The Great Venture Capital Rotation. I think it was originally titled “The End of Venture Capital Sort Of” (based on the URL). In addition to being provocative, it lined up nicely along a few others posts on this topic from Fred Wilson (Leading vs Following), Hunter Walk (AngelList Syndicates Will Also Pit Angel Against Angel) and Howard Lindzon (So You Want to Angel Invest…Be Prepared to Lead and Follow.) Naval, Nivi, and the gang at AngelList have really busted some stuff open and it’s interesting to watch it play out.
But – if you know me, you know I’m not satisfied with just watching. So I dove in and joined a few syndicates on AngelList, including Jason’s, Dave Morin, and Naval’s.
And – if you’ve read this far, the new Sphero 2.0 is out and is amazing. Get yours today.
I think AngelList is awesome and I’m a huge fan of what they’ve done. Nivi wrote a great post celebrating their 1.5 year anniversary today: 1.5 Years Of AngelList: 8000 Intros, 400 Investments And That’s Just The Data We Can Tell You About.
One of the powerful constructs of AngelList is social proof. It’s become an important part of the seed / early stage venture process as very early stage investors pile into companies that their friends, or people they respect, are investing in. AngelList does a nice job of exposing and promoting social proof during the fundraising process in a way that is both legal and non-offensive.
However, as one would expect, entrepreneurs focus on taking advantage of every opportunity they have. As a result, I’ve been getting a request on a daily basis to either “follow” or be listed as an “endorser” for various companies. These requests fall into two categories: (a) people I know and am trying to be helpful to and (b) random people.
I’ve decided to say no to both categories unless I’m investing in the company. And I encourage everyone involved in AngelList to do the same. I think the concept of social proof is super important for something like AngelList to have sustainable long term value. I don’t ever want to be on the end of a conversation with someone who invested in a company on AngelList, runs into me, and says “things are sucking at company X – why did you ever endorse them” and for me to say “I have no idea who you are talking about.”
As with many things in life, the key lesson is to do your research. It’ll be interesting to see how AngelList copes with things like this over time – I expect Nivi and Naval will stay one step ahead of the problem. However, if you are an investor or entrepreneur – help by having some discipline on your end – it makes things better for everyone.