Last week saw an explosion of discussion around seed investing, including plenty of negative comments around VCs as seed investors. While I agree that many VCs are crummy seed investors, I think there are some that are excellent seed investors. This prompted me to write a post titled AngelList Boulder and Some Thoughts on Seed Investing where I promised to write up some of my thoughts on how and why VCs could be good seed investors. ...
This just makes me want to crawl under my desk and cry for a while. Can you imagine how much it would hurt if you threw that at a lawyer or an accountant and actually hit them with it? Skadden Partner Completes 409A Handbook : “ Sneak Preview Here Regina Olshan Erica Schohn Flashback: Regina Organizes Push for 409A Extension” (Via 409A Dismay .)
I’ve been in several board meetings over the past month where the companies are having a killer Q2. A year ago everyone was still pretty rattled from the financial crisis and there was plenty of belt tightening, consternation, and general anxiety. By Q409 we’d had a number of companies we are investors in end the year strongly and their growth has continued into Q1 and Q2. Over the past 15 years, I’ve sat through plenty of good meetings and plenty of bad board meetings. I always try to acknowledge the efforts of individual executives when they’ve exceeded expectations and the full team when they’ve crushed it. I’m not afraid to be direct and critical and I always speak my mind, but I try never to forget to praise people for their efforts. ...
I was in a meeting with Rich Miner from Google Ventures on Friday with some entrepreneurs we are working with on a potential investment. While the team isn’t a rookie team, they’ve never worked with VCs before and they’ve been wrestling around the dynamics of how to interact with the two VCs in the room (me and Rich) and the various angels that are part of the seed round we are planning to do. ...
Every quarter, without fail, a bunch of articles appear talking about the venture capital industries investment pace as a result of the PWC MoneyTree report. I used to get calls from all of the Denver / Boulder area reporters about my thoughts on these – that eventually stopped when I started responding “who gives a fuck?” A few days ago I got a note from Steve Murchie about his new blog titled Angels and Pinheads . I’m glad Steve is blogging about this as he’s got plenty of experience and thoughts around the dynamics of angel investors – some that I agree with and some that I don’t. Regardless, my view is that there more there is out there, the better, as long as people engage in the conversation. ...
There were some great comments on my post from Sunday titled Being Syndication Agnostic . One of them was from Kevin Vogelsang – he asked the following question: What are the downsides to syndicating a round of financing for the entrepreneur/startup (assuming the relationship with all investors is a good fit of course)? By syndicating a deal, the entrepreneur gains access to a larger network. This seems to be a big positive. However, there must be downsides (less attention, more interest groups, etc.) Love to hear more on the topic. ...
Bijan Sabet started it with a great post titled We Gotta Do A Deal Together and Fred Wilson followed with an equally great post titled Trading Deals, A Lost Art? I’m going to try to add to the mix with this post by describing our strategy at Foundry Group around syndication and explain a little of where it came from. Please read both Bijan’s and Fred’s posts as it’ll provide a lot of context for this one. ...
Three of my VC friends (Santo Politi , Mark Suster , and Kate Mitchell) were on Fox Business’ Capitalist Ad”Ventures” series. The underlying theme of this segment was the characteristics of entrepreneur that VCs look for. Fox doesn’t seem to have embeds, so you’ll have to use this URL to watch “The Future of Venture Capitalism”. While Santo, Mark, and Kate weren’t the maniacal crazy people (although I’m sure some will argue that), they were clear about the ones they are looking for. Nice job gang!
VCs say a lot of stupid things. I’m guilty of it plenty and whenever someone calls me on it I try to acknowledge and change. One that I try really hard not to do is say “my company” when referring to companies I’ve invested in – I think it’s one of the most annoying things a VC can say. I was talking to a VC the other day about a few companies he had invested in. By the third time he referred to one of the companies as “my company” (as in “My company is working on X”, “My company would like to talk to Company Z about thing Y”) I felt myself starting to react. I didn’t really have a relationship with this VC, but I knew that he had never run a company (investment banking post college, MBA, then VC). I realized I wanted to stop him at some point and say “dude – it’s not your company – you are merely an 18% shareholder in the business.” I bit my tongue and had the conversation, but I’ve been thinking about this in the back of my mind ever since. ...
Mark Suster, a partner at GRP Partners, has an outstanding post up this morning titled VC Seed Funding is Dead, Long Live VC Seed Funding . Mark started blogging recently and has quickly turned into my second favorite VC blogger (after Fred Wilson ) – if you don’t subscribe to his feed, you should. Mark just did his first seed deal, a $500k investment in a company called Ad.ly , and his post is a long essay on how he’s thinking about seed investing these days. He makes the appropriate warning (and differentiation) between VC investors who view seed investments as “options” on future rounds (e.g. they toss a little money in and then generally ignore the company until the next financing) and “active seed investors” (like First Round Capital, SoftTechVC, True Ventures, Union Square Ventures, and O’Reilly AlphaTech) who view the seed investment as their first round of several as they help get a company up and running. ...