Investments

You may noticed from prior posts that we’ve had a difficult time at Foundry Group managing our growing portfolio of WordPress sites . We are not alone. You would think that by now, managing websites would be a solved problem, but that’s just not true. Talk with any professional marketer about their websites and two things will become clear: 1) websites are absolutely central to how digital marketing gets done and 2) websites are a giant pain in the ass. ...

Today, Rover announced that Menlo Ventures has led a new $12m round of financing . As is our style, we participated, but we’re excited to have a new partner to join us, Madrona, and Petco in this fast growing adventure. Lots of VC firms are once again talking about online marketplaces. Some get it; many don’t. Being systematic about what it takes to build and scale a marketplace effectively and make it an enduring enterprise is difficult. ...

I’ve loved being involved in Orbotix from the very beginning. I got to know Adam and Ian, the founders, even before they got into Techstars. Their original company name was GearBox and they probably wouldn’t haven’t gotten into Techstars except that both Nicole Glaros and I said “we love these guys – fuck it – let’s try a hardware company this time.” Paul Berberian, one of Adam and Ian’s lead mentors during Techstars joined them as the third co-founder before demo day and we led the seed round shortly after. Orbotix is now 40 people, with hundreds of thousands of Sphero’s out in the wild and being played with, and a new product (currently codenamed 2B ) coming out this fall. ...

Lots of people talk about being transparent. Lots of companies espouse principles of transparency. Lots of statements start out with “I like to be transparent” or “I’m being transparent when I say …” And several years ago the notion of transparency became the new in thing, especially around the VC and startup worlds. Most of it is bullshit. If you want to see real transparency, take a look at Moz’s 2013 Year in Review: More Than You Ever Wanted to Know About Moz, and Then Even More . ...

I’ll be speaking at an Impact Angel Group event on February 12th. With a few other angel investors, I’ll be talking to other angel investors, along with prospective angel investors, about the role of impact investing the community, as well as in our own portfolios. Among other things, we’ll discuss our angel investment strategies and openly share things like the percentage of our wealth that we allocate to angel and impact investing. We’ll also talk about how we balance our impact, risk, and financial goals. Finally, I’ll also discuss our experience with FG Angels and AngelList, along with the angel investment strategy I’ve used over the past 20 years . ...

When the JOBS Act was finalized, one of the rule changes that had a lot of fanfare around it was the increase in the number of shareholders a private company could have. Prior to the JOBS Act, it was 500, after which point the company had to register and report to the SEC just like it was a public company (even if it hadn’t gone public.) This was a major issue for many fast growing companies that either went through strange contortions not to have 500 investors, or filed with the SEC to get no-action letters. There were plenty of nuances around this rule and I was in the middle of several situations that structured around it legally. Each time it was a lot of overhead for the company in question, none of which added anything to the system except fees to the lawyers. ...

One of the most annoying things about being an angel investor is filling out the same Accredited Investor Questionnaire over and over again. I’ve made about 200 angel investments and over 50 VC fund investments at this point since 1994 and I’ve filled out some version of this form at least 250 times. A few weeks ago Fred Wilson made an open request for A Web Service For Qualified and Accredited Investors . He was referring to the form that used to be required under what is called “501” that now goes by the friendly name 506(b). I doubt he has yet to fill out a form for 506(c), which is the new requirement for “general solicitation” under the JOBS Act. At least I hope he hasn’t, because there are a whole host of new and exciting issues with companies that use 506(c). ...

I love playing offense. FullContact is officially in this mode and today announced that they have acquired Cobook with Pot, Ski Passes and Dogecoin. Kaspars Dancis – the awesome CEO of Cobook – has a more seriously titled (and equally serious post) up at COBOOK + FULLCONTACT . One of my basic strategies as an investor is to use targeted small acquisitions throughout the life of a company. In 2005 Fred Wilson called this approach the “venture rollup ” and said nice words about me and it in his post when he said “My good friend Brad Feld is up to his old tricks. Brad is the master of the venture rollup.” ...

One of the super crazy fun companies we are investors in is Betabrand . At this point, half of my new wardrobe comes from them. They are hunting for a new amazing UI/UX developer. But – to show how much they want someone, they’ve designed an incredibly hideous new look for their site. They’ve got blink tags, Comic Sans, spinning boxes, Nyan cat cursors, Papyrus, an on fire Under Construction prompt, and really bad color overlays. It reminds me of a Geocities page I once created. ...

What better way to start off a new year than by closing a new investment. This morning we announced that we have closed a financing in OnTheGo Platforms via our FG Angels syndicate . On October 1st, 2013 we announced that we’d be forming an AngelList syndicate called FG Angels and making 50 seed investments through AngelList by the end of 2014 . We committed $2.5m from our Foundry Group funds for this effort and decided to max out the syndicate at $500k / investment, or $25m total. So $2.5m would come from us and $22.5m would come from syndicate participants. ...