We just announced our investment in Meru Health . If you recognize Meru Health , it’s because I wrote about it in January as part of my explanation of Freestyle’s Leadership on Mental Health . I highlighted what Josh Felser and his team at Freestyle were doing, which included underwriting 100% of the cost for two programs – Meru Health  and Hoffman Institute , for all of their founders.

We got to know Kristian Ranta and his team at Meru Health through Josh. Freestyle is one of our 32 partner funds (where we are LPs) and most of our new direct investing activity is in conjunction with one of our partner funds.

Forbes wrote a detailed profile of the company and the investment in Foundry Group And Slack Are Backing A Virtual Therapy Startup That Raised $8.1 Million and we are excited to be part of Meru Health.

Over the past two months, I’ve been asked almost daily if “VCs are investing during the Covid crisis.” Generic questions like this are impossible to answer, as “VCs” are not a singular archetype (there are many types of VCs with different strategies, goals, personalities, and constraints.) So, I answer it from the frame of reference of what we are doing at Foundry Group.

In general, I think the best answers are examples.

For me, the Covid crisis started on March 11th. This was the first day I worked from home and haven’t left my house since then. We were planning to have our CEO Summit in Boulder on March 12th and 13th but cancelled it on March 9th. My parents were coming to Boulder on March 12th for a long weekend and to celebrate my dad’s 82nd birthday. My brother Daniel and I decided to cancel their trip and told them the night of March 11th. Bryan Leech at iBotta hosted the first “Denver Business Leaders” call the morning of March 11th. So, when I look back and mark this moment in history, it started for me on March 11th.

Since then, Foundry Group has closed three new investments.

• Fritz.Ai (partner fund: Uncork): March 25th
• Code Climate (partner fund: USV): May 11th
• Meru Health (partner fund: Freestyle): May 13th

We generally make about 10 new investments a year. While it’s not spaced out monthly (we don’t try to manage timing that granularly), if you look back to when we started Foundry Group in 2007 we’ve done a maximum of 14 new investments in a year and a minimum of 8 new investments.

When asked if we are investing, I answer “yes – on the same pace as we always have.” We have a deeply held belief that time diversity in investing matters, and the key is to keep the same pace of new investments no matter what is going on in the macro.

It’s that time of year again where we like to shop at our portfolio companies.

We thought it would be fun to highlight some of our direct investments and partner funds’ portfolio companies this holiday season.

You can check out the full Foundry Group Gift Guide here.

If you want even more gift options, Techstars also has an awesome gift guide.

Semil Shah recently wrote a post titled Investing Outside The Bay Area . In it, he talked about his own experience expanding his investment horizons beyond the bay area, but also mentioned some other folks, including us and USV, where he did a quick analysis of the location of our partner funds.

From Semil’s post:

“Another firm linked closely to USV — Foundry Group in Boulder — has also been investing with an eye for geographic diversity. While I don’t have portfolio level stats for them, their new endeavor Foundry Next (to invest in smaller funds and then follow-on into key investments) has built up an LP basket of 23 positions in a variety of new VC funds. Of the 23 funds listed here, 13 are in the Bay Area, 3 in NYC, 3 in Boston, 2 in LA, and one each in Detroit, Seattle, Toronto, Waterloo, Indianapolis, and Fargo, North Dakota. This is a very clever way of helping new funds get their footing and hearing about what is working before others may pick up the scent.”

That generated a fun email exchange between us and prompted me to do an analysis on the locations of the direct investments that we’ve made since we started Foundry Group in 2007. The geographic breakdown of our 123 direct investments follows:

Twelve years later, we were pretty close. When we started Foundry Group, we said that 33% of our investments would be in California (which, at the time, we thought of as equivalent to the Bay Area), 33% would be in Colorado, and 34% would be in the rest of the United States.

We have always believed that great companies can be created anywhere. While we don’t have a geographic allocation approach, we were willing to travel and invest everywhere in the US. We knew that some places, like NYC, Boston, and Seattle, where we already had deep networks, would be common places for us to invest. We’ve been pleasantly surprised with the expansion of our networks in other geographies, like Southern California (LA, San Diego, and Santa Barbara) and Portland.

It’s useful to note that in addition to our direct investing and partner fund investing , we are investors in Techstars , which has redefined seed stage investing all over the world. Currently, they are running accelerator programs in over 16 cities and 13 countries, in addition to Startup Weekend and Startup Week activity, which thoroughly covers the world.

As we start investing Foundry Group Next 2018 , I expect we’ll add a few more states on both the direct and partner fund investing side. Hopefully, we will continue to help develop and expand existing and new startup communities.

This post originally appeared as Announcing Foundry Group Next 2018 on the Foundry Group website.

We are happy to announce the closing of our seventh fund, Foundry Group Next 2018. The $750 million fund combines all of our prior fund strategies – our early stage, early growth, and partner fund investments – into a single fund.

For historical reference, our early-stage funds (FG 2007, FG 2010, FG 2013, and FG 2016) are all $225 million in size. Our first early growth fund raised in 2013, Foundry Group Select, is also $225m in size. In 2016, when we raised Foundry Group Next, we approximately doubled the size of that fund to $500 million since 30% of it was going to be invested in partner funds and 70% in early growth. So, at the beginning of 2016, we effectively raised $725 million (FG 2016 and Foundry Group Next). Foundry Group Next 2018 is simply the combination of those two funds rounded up slightly.

Our strategy is unchanged – we’ve just combined all of our investing activity into one fund going forward. When we started Foundry Group, we had four equal partners. We now have seven equal partners. We invest all over the United States and Canada. We have a deliberate and focused set of themes that encompass almost all of our investments. We are syndication agnostic, being indifferent between investing by ourselves or with co-investors – especially our partner funds – where we mostly have long and successful relationships. Our goal is to have significant ownership in companies we are investors in (often over 30%). We are very long-term investors, focusing on net cash on cash returns, rather than short-term or intermediate IRRs.

While we have an early entry point from our historical early-stage investing, we don’t have to be the first investor in a company. With the Cambrian explosion of seed funds that has occurred in the last five years, we’ve chosen to invest in these funds directly (which we call our partner funds ) rather than try to chase seed investments all around the country. If a company hasn’t raised more than $5 million, we are a good target, as long as it is in the US (or Canada) and in one of our themes.

We are full lifecycle investors and willing to invest, and lead, Series A, B, and C rounds. We refer to B and C rounds as early growth – essentially financings with valuations between $50m and $300m pre-money. By being syndication agnostic, we are happy to lead multiple rounds of companies we are already investors in, but we also love to welcome in co-investors who we like and respect, along with any of our LPs who want to participate directly alongside us.

We have a small team (16 people total). The seven partners all work directly with the companies and partner funds. We have a CFO, a General Counsel, six EAs, and one fund investment associate. We don’t expect or intend to add anyone to our team going forward.

We’ve worked hard to have a network-centric view of the world. As a small team based in Boulder, Colorado, we have developed a very broad network which includes all of the entrepreneurs we work with, our LPs, VCs we co-invest with, our partner funds, several startup studios, Techstars , and many other colleagues through our writing, startup community leadership, and non-profit activities. We think of ourselves as one node on a mesh network, an important node, but not a central node through which everything must flow. We subscribe to the notion of #GiveFirst and try to be helpful to everyone we come in contact with.

We know who we are at year 12 in our journey as a firm, love what we do, and try very hard to do it clearly, honestly, authentically, and transparently with everyone we interact with. Creating and building companies is extremely hard, and we have deep respect for everyone we get to work with through all the ups and downs.

We very much look forward to continuing to work with everyone we currently work with, as well as another group of great entrepreneurs and VC fund managers in our Foundry Group Next 2018 Fund. We are also happy to welcome a small number of new Limited Partners to our family. We are pleased to partner with such a great group of investors.

Thanks for allowing us to be part of your journey.

– Jason, Ryan, Seth, Brad, Lindel, Moody, and Jamey

I regularly get asked by other VCs about how we do our offsites.

When we started Foundry Group in 2006, we had a very deliberate quarterly process in an effort to learn all about each other and become highly effective at working together. For the first three years, we were disciplined about the timing and process, used an outside facilitator , and always spent one night away together as a group. This was intense and rocky for the first few years, as we had to work through a lot of stuff as individuals and as a team, even though we had all been working together since the early 2000s at our prior firm.

Around 2010, as we started to feel like we had hit our stride working together as a team, we shifted from a facilitator driven model but maintained our quarterly rhythm. Recently, after adding Lindel , Moody , and Jamey to the team, we’ve shifted back to a facilitator driven model in an acknowledgment of the value of really learning each other and now becoming a highly effective team of seven, instead of four.

I think a regular offsite rhythm is critical for every VC firm of any size (including solo GPs, where the offsite can include either the whole team or a few of your key LPs and advisors.) While I’m sure there are different approaches that can work, when I reflect on almost a dozen years of our offsites, I think the approach, combined with the simplicity, has served us extremely well.

So, in case it’s useful, following is our approach to offsites.

Facilitator: For stretches of time, especially early on in our working relationships, or during any rough patches, we’ve used an outside facilitator. If you want a referral to anyone, just email me.

Close to Home*:* We try to avoid the offsite becoming a boondoggle. We keep it close to home and relatively modest. Many of them are either at Jason’s house, my house, or a hotel in Denver. Occasionally we’ll go to a resort in Colorado Springs (a two hour drive). Once every few years we’ll combine it with a trip somewhere (New York, Chicago) just to change the atmosphere a little, but even then, other than a fancy dinner somewhere, it’s on the modest side. But we never do offsites at the office (I mean, it’s an offsite after all.)

At least a full day*:* We start first thing in the morning and finish with dinner. We often spend the night together (for many years Seth, Ryan, and I had assigned bedrooms in Jason’s house.) We schedule a second day – if we end early, we have time to catch up on things, including stuff that came out of our discussion.

Rotating leadership: When there were four of us, each of us led the offsite once a year. During the stretch we are in through the end of 2018, which is using a facilitator to help us wire up the next level team of the seven of us, I’ve been the leader so there is some consistency of approach. The leader is a lightweight leader, just making sure the offsite happens with an agenda, as you’ll see in a second.

Crowdsourced agenda around two topics: Like many things in our world, we develop the agenda collaboratively and continuously. A month before the offsite, the leader shares a Google Doc with logistics and a skeleton agenda. We then fill it out, rarely exceeding a page. There are two primary segments: (1) our portfolio and (2) our relationship. By using these as the driver, we can go deep on a number of different issues, including our overall strategy. We try to keep the agenda high level and have a section called “Other Things to Discuss” which allows us to put up anything tactical on anyone’s mind. The leader curates the agenda and we finalize it the week before the offsite.

Portfolio: We have lots of different approaches to this, but it’s essentially a deep dive on a portion of the portfolio. The leader chooses the approach, which is often a brand new one, so we don’t get into stale rhythms. My historical favorite is the use of index cards with company logos on them. The leader shuffles the cards (our entire active portfolio, which is now a lot of cards) and turns them over one at a time. Whoever is on the board is not allowed to speak – they have to listen as the other partners reviews the portfolio company. Once the non-board member partners have talked about what they think is going on at the company and what we need to focus on, the board member gets to weigh in. Since our model is that everyone works on everything together, this is an incredibly insightful approach at two levels: (1) the company info and (2) our level of internal communication about the company. It also reinforces the value of being vulnerable to your partners – it’s often really hard to sit quietly and listen to the details without jumping in and trying to steer the conversation or inject your point of view into the mix. A more recent approach that I loved (that Seth came up with) is to start with a portfolio value assessment by company. We put an X-Y graph up on the wall with the Y-axis being amount of work (high to low) and the X-axis being the value to the fund of our ownership in the particular company ranging from $0 to $225m (where a company returned the fund.) We each put the index card for the company we were responsible for up on the wall in the place we think it belongs. We then discussed the entire portfolio for each fund, which generates a lot of discussion and calibration (including moving a lot of index cards around, since if we did the exercise blind, we’d all have different views.)

Ourselves: We either address the question “How Are You Doing?” (which is personal and professional, internal or with regard to others in the partnership) or do a set of facilitated exercises. We often start with a Red/Yellow/Green check-in . We orient the discussion around each person and take our time, rather than rush through updates. If there are conflicts between people, they surface quickly since we are all tuned to talk about struggles we are having, rather than focus on the awesomeness of how great our universe is. Each of us approaches this with our soul wide open – the starting point is trust, vulnerability, authenticity, and other words like that. While “How Are You Doing?” is a simple question, it opens the door wide for a variety of things, and the conversations that have ensued around one person have often generated a richness of discussion that lasts hours and often involves tears and other surprising emotions.

Obvious but important meeting rules*:* No phone. No email. If you have to go to the bathroom, go. We always make sure there are snacks in the room. Don’t interrupt. Listen with both ears; talk with one mouth. We build 30-minute breaks into the agenda so we can catch up, and, more importantly, breathe and stretch during the day. There’s usually a chance to exercise before dinner.

Dinner is a critical part of things: On some occasions, we have a meaty topic to discuss that we save for dinner. On others, we use it to heal our relationships and remind ourselves that even though we have plenty of conflicts and struggles, we are best friends. We usually do this in a private room somewhere so we can take the conversation wherever we want to go.

We try not to rush. We are gentle with each other, reminding ourselves that a key value of Foundry Group is brutal honesty delivered kindly . And we always remember that one’s individual truth may not be “the truth” and it’s important to be willing and able to explore what happened, or is happening, in a particular situation, instead of simply what you think happened.

Finally, we are always trying new things, so if you have stuff you do in offsites that are different, or additive, to our approach, toss them up in the comments.

Over the past 25 years, I’ve attended approximately 14,387 board meetings. My partners and I talk a lot about how to improve them and today released The Foundry Group Manifesto on Board Meetings . It follows:

In 2013, I wrote a book with Mahendra Ramsinghani about board meetings titled Startup Boards: Getting the Most Out of Your Board of Directors. It was a tough book to write because every time I dug into it, I got bored, but I think it ended up being a contribution to the corpus of entrepreneurial knowledge. However, I anticipate Bored Meetings will be an even more significant contribution.

If you enjoyed I’m a VC , take another walk down memory lane with me back to 2015 and watch our second video, Worst of Times.

More soon. Hint, hint …

As a preparation for something new and exciting, let’s reminisce a little. In 2011, we did our first Foundry Group music video “I’m a VC.”

I remember being amazed when the Youtube views went over 100,000. I recall being equally amazed when I heard that our IT guy (Ryan ) had cleaned up our random Google accounts, deleted video@foundrygroup.com , and as a result deleted the video. When it was restored, the view counter was at 0.

Oops.

My partners and I just announced that our long-time friend and LP – Jamey Sperans – has joined Foundry Group .

We’ve been working with Jamey since the beginning of Foundry Group in 2007 (he was one of our first LPs via Morgan Stanley AIP) and have become extremely close friends.

Jamey and his family have moved to Boulder, so in addition to working with us, he’ll become a part of the extended Boulder/Denver startup community.

We are delighted to have Jamey in town and on our team. If you want the backstory, take a look at the post on the Foundry Group site titled Introducing Our New Partner – Jamey Sperans .

Yesterday, my partners at Foundry Group announced financial support for the Time’s Up Legal Defense Fund .

We strongly believe that sexual harassment is unacceptable in any form. While there can be a debate about whether sexual harassment is about sex, power, or something else, there’s an additional pernicious element of it when the harasser threatens to sue the person being harassed. This extends the harassment and reinforces the issue around the power dynamic, especially when the harasser has much more financial resources than the person being harassed.

My partners and I were considering establishing a VC / Entrepreneurs Sexual Harassment Legal Defense Fund. When we saw the launch of Time’s Up and the Time’s Up Legal Defense Fund , we decided to financially support this activity and try to create a sub-group for the tech industry. As a starting point, Foundry Group is contributing $100,000 to the Time’s Up Legal Defense Fund and Anchor Point Foundation  is contributing $100,000.

In addition, we are reaching out to VCs and Angel Investors that we know to see if they will join in our effort. If you are a VC or Angel Investor who wants to financially support this effort, please email me . And, if you are an individual who wants to directly support the Time’s Up Legal Defense Fund, please do so on the Time’s Up GoFundMe page .

Finally, for some inspiration, watch Oprah Winfrey’s powerful speech at the 2018 Golden Globe Awards.

We are excited to announce that Chris Moody is joining Foundry Group as a partner.

When we started Foundry Group in 2006, we were very clear that we were not going to build a legacy venture capital firm; one meant to outlive its founders. There would be no generational planning, no transitions to younger partners, and no senior partner hold-outs who would hang onto economics well after they had stopped working. Simply put, when we are done investing, we will drop the mic and shut off the lights.

In 2014, Seth, Jason, Ryan, and I had the first of many conversations about our long-term plans for Foundry Group. These discussions resulted in the creation of Foundry Group Next , the addition of Lindel Eakman to our team, and our first Foundry Group Next fund which we closed in 2016 .

The conversation that we started in 2014 has continued on a regular basis, both formally at our quarterly off-sites but also pretty much every time the four of us were together. As part of this, we started an exercise of explicitly looking forward a decade and talking about what Foundry Group looked like from each of our perspectives at that time. With each new fund we raise, we are making at least a ten year forward commitment to each other, our investors, and the founders whose companies in which we invest. For the first seven years, this was easy, since we each had a 20-year view of Foundry Group when we started it in 2006. But as time passed, we realized we needed to start to think more deeply about the future of Foundry Group and how we evolve our investment activities.

The venture business is an inherently challenging one to scale. Leverage – of time, capacity, and capabilities – is hard to achieve. As Foundry Group raised more funds, we realized that our ability to continue to manage our business effectively was becoming limited by our individual time and capacity. Recognizing this, we started to make a list of people we would consider adding as partners, as one of our deeply held beliefs was never to have associates, venture partners, or EIRs as part of our firm.

For a while, the only name on the list was Lindel’s. It took us several years to get our mind around adding someone, but once we did, we added a few more names to the list. It probably won’t be a surprise to anyone reading this that it is a very short list.

Back to Chris Moody. Chris was most recently VP & GM of Data & Solutions at Twitter, running a multi-hundred million dollar enterprise business unit. In addition to running one of Twitter’s fastest-growing business unit, Chris was responsible for leading Twitter’s developer platform and ecosystem involving hundreds of enterprise partners and one of the world’s largest active developer communities. We’ve known Chris since 2007 and worked extremely closely with him when he was the CEO of Gnip and well as a leader in the Boulder Startup Community. Over the years, we also became very close friends with Chris.

After we had raised the first Foundry Group Next fund last September, we started having a serious conversation about having Chris join us at Foundry Group. This was driven by our reflection on our current workload, how we were adjusting what we were doing based on the addition of Lindel to the team – which had re-energized us a lot, and how we were thinking about the next ten years of Foundry Group.

In addition to working closely with Chris as a CEO (I was on the board of Gnip), we all worked with Chris through Techstars (he was one of the original mentors in the 2007 program). After Twitter acquired Gnip in 2014 , Chris joined the boards of two of our portfolio companies (Pantheon and mLab ) and worked closely with Ryan on these boards as an outside director.

We knew Chris was an extraordinary board member as well as an extremely seasoned CEO. We had a great affinity for each other, and he shared our value system. When the five of us sat around talking about Chris, after each conversation we got more excited about having him join us, especially as we learned about his personal view for the next decade of his life.

For those of you who don’t know Chris, I encourage you to watch this short video of Chris’ commencement  address at Auburn University last spring. I think you’ll get a small glimpse of what he is about and why we’re so excited to have him as our partner.

Chris has been burning the candle at both ends for 27 years without ever taking a meaningful break. We insisted that he take the summer off to recharge his batteries and spend focused time with his awesome wife Sarah and his three delightful kids. He’ll officially join us at the end of the summer.

Welcome, Chris!

I’ve become a huge fan of Harry Stebbings, the intrepid entrepreneur turned VC  whose age (20) matches the title of his podcast (The Twenty Minute VC .) Today, at SaaStr at 1:40pm in the Hypercritical section, Harry is interviewing me about – well – whatever he wants.

Harry has done hundreds of 20 minute VC interviews over the past few years. It’s a staple of mine on my podcast listening rotation so I’ve heard a bunch of them. It’s fun to watch Harry evolve as an interviewer as his knowledge of the industry has increased dramatically and his point of view about various VC-related things has become crisp and clear. And his hustle is relentless and has led to him also doing the SaaStr podcast and joining Atomico .

All five of the Foundry Group partners have been interviewed at this point. I think our interviews are a great way to get to know us quickly since we each tell our story, our strategy, and our approach in our own words and from different perspectives. Over the past few weeks I’ve probably talked to over 100 VCs between my trip to Australia, LA, and SF. When I find myself telling our story in response to being asked, I often wish I had a short cut to point people to.

This post is now the shortcut. I’ll use Harry’s original titles so you can see how his SEO prowess has evolved.

20 VC 065: FOUNDRY GROUP WEEK 1: BRAD FELD

20 VC 066: FOUNDRY GROUP WEEK 1: SETH LEVINE

20VC: THE FUNDAMENTALS TO CREATING A SUCCESSFUL VENTURE PARTNERSHIP & THE OPTIMAL INVESTMENT DECISION MAKING PROCESS WITH RYAN MCINTYRE, CO-FOUNDER @ FOUNDRY GROUP

20VC: HOW 50% OF VCS HURT ENTREPRENEURS, HOW TO BUILD A RELATIONSHIP OF TRUST WITH YOUR VC AND HOW ENTREPRENEURS CAN DETECT VC BS WITH JASON MENDELSON, CO-FOUNDER @ FOUNDRY GROUP

20VC: WHY MANY VCS FAIL TO RAISE, WHY LP COMPENSATION IS A MASSIVE PROBLEM & WHY FUND OF FUNDS WILL BECOME MORE PROMINENT WITH LINDEL EAKMAN, MANAGING DIRECTOR @ FOUNDRY GROUP

Yeah – I don’t love the capital letters either, but there you have it.

In case you are wondering about the tone of the 100 VCs I’ve talked to, I’d rate it as very high on the anxiety meter. Some of the tone is from the macro dynamics post election, but some seems deeper and more unsettled. I don’t know what it is, but I switched my Headspace meditation pack from Motivation (which I don’t need any help with) to Anxiety, just to be proactive.

We have some entertaining news to share with you today. We have recently registered with the SEC and are now considered Registered Investment Advisors. Did we do this so that we can have cooler business cards? No. Did we do this because our back office was lacking in purpose? Heck no.

We had to, per the SEC rules. And the reason you ask? Well, we can’t tell you that or we could possibly break some other SEC rules. So for now, just accept that your friendly neighborhood venture capital firm is now subject to a lot of new and stimulating paperwork.

Why are we even bothering telling you this? Because it will affect what we can say on the Foundry Group blog and personal blogs that we write. We’ll have to be careful with statements that we make about companies we invest in. We’ll also be cautious in what we write about our funds or the industry in general. According to the SEC rules, we can no longer write anything that “promotes” our funds. While we’d argue that we never try to promote our firm, but just write anything that comes to mind and try to have fun doing it, with our new registration status comes new responsibilities.

This will be a learning process for us and our goal is to bring you content that is still 100% transparent. Please be patient with us if there are hiccups along the way, or perhaps even questions that we can’t legally answer in the comment sections anymore.

And as always – thank you all for the support. We love what we do and the community, and our interaction with you through our blogs, is a big reason why. And, don’t worry, there will be a third VC video from us – someday.

After all these years, I’m still a heavy RSS user. Every morning I click on my Daily folder in Chrome, open it up, and spend whatever time I feel like on it. The vast majority of what I read is in Feedly and includes my VC Collection as well as a bunch of other stuff. It’s almost entirely tech related, as I stay away from mainstream media during the week (e.g. no CNN, no CNBC, no NYT, no WSJ, no USA Today, no … well – you get the idea) since I view all this stuff as an intellectual distraction (and much of it is just entertainment anyway, and I’d rather read a book.)

This morning I came across a number of interesting things that created some intellectual dissonance in my brain since they came from different perspectives. I’d categorize it as the collision between optimist and pessimist, startup and already started up, and offense vs. defense. However, they all shared one thing in common – the message and thoughts were clear.

Let’s start with Tim Cook’s remarkable Message to Our Customers  around the San Bernardino case and the need for encryption. My first reaction was wow, my second reaction was to read it again slowly, and my third reaction was to clap quietly in the darkness of my office. I then went on an exploration of the web to understand the All Writs Act of 1789 which is what the FBI is using to justify an expansion of its authority. I love the last two paragraphs as they reflect how I feel.

“We are challenging the FBI’s demands with the deepest respect for American democracy and a love of our country. We believe it would be in the best interest of everyone to step back and consider the implications.

While we believe the FBI’s intentions are good, it would be wrong for the government to force us to build a backdoor into our products. And ultimately, we fear that this demand would undermine the very freedoms and liberty our government is meant to protect.”

Thank you Tim Cook and Apple for starting my day out with something deeply relevant to our near term, and long term, future in a digital age.

Shortly after I came across Danielle Morrill’s post Surviving Whatever Comes Next  and Heidi Roizen’s post Dear Startups: Here’s How to Stay Alive . I’m an investor in Danielle’s company Mattermark  and was partners with Heidi at Mobius Venture Capital. I have deep respect for each of them, think they are excellent writers, and thought there were plenty of actionable items in each of their posts, unlike many of the things people I’ve seen in the last few weeks about how the technology / startup world is ending.

Unlike the sentiment I’ve been hearing in the background about deal pace slowing down (not directly – no one is saying it – but lots of folks are signaling it through body language and clearly hedging about what they are actually thinking because they aren’t sure yet), our deal pace at Foundry Group is unchanged. Since we started in 2007, we’ve done around ten new investments per year. I expect in 2016 we’ll do about ten new investments, in 2017 we’ll do about ten new investments, in 2018 we’ll do about ten new investments – you get the picture. We have a deeply held belief that to maximize the value and opportunity in a VC fund, investment pace should be consistent over a very long period of time. We did about ten investments in 2007, 2008, and 2009 – which, if I remember correctly, is a period of time referred to as the Global Financial Crisis . Hmmm …

So it was fun to see my partner Seth’s post titled Welcome to Foundry  on the same morning as Danielle and Heidi’s posts. That started the intellectual dissonance in my brain. If you want to see what Seth sends every company he joins the board of after we make an investment in, it’s a good read. It also clearly expresses how we approach working with companies the day after we become an investor.

I then read Ian Hathaway ‘s great article for the Brookings Institute titled Accelerating growth: Startup accelerator programs in the United States . There are a few people doing real research of the impact of Accelerators and Ian’s work is outstanding. If you are interested in accelerators, how they work, how they impact company creation, and what trajectory they are on, read this article slowly. It’s got a bonus video interview with me embedded in it.

I’ll end with Joanne Wilson’s post #DianeProject . Joanne shared a bunch of info about the #DianeProject with me when we were together in LA two weeks ago. While I don’t know Kathyrn Finney , I now know of her and her platform Digital Undivided . I strongly recommend that you pay $0.99 (like I just did) to get a copy of the report The Real Unicorns of Tech: Black Women Founders, #ProjectDiane. The data is shocking, and there is an incredible paragraph buried deep within it.

“A small pool of angel and venture investors fund a majority of Black women Founders. For those in the $100,000-$1 million funding range, a majority of their funders were local accelerator programs and small venture firms (under $10 million in management). One angel investor, Joanne Wilson and Gotham Gal Ventures, has invested in three of the 11 companies that raised over $1 million. On the traditional venture rm side, Kapor Capital and Comcast’s Catalyst Fund have invested in at least two of the Black woman-led startups in the $1 million club. Wilson, Kapor, and Comcast often invest together, aka “co-invest”, in companies, thus increasing the amount of funding a company receives.”

So – was that more interesting than CNN or CNBC?

I’m finally home after three solid weeks on the road which included Austin, Dallas, New York, Boston, Philadelphia, and Los Angeles. It’s delightful to sit in my green zebra chair in Amy’s upstairs office, with a cup of tea, the Diana Krall channel playing on Pandora, and just catch up on stuff.

The extra points from my trip was getting to spend some face time with close friends and family that I haven’t seen in a while. Amy joined me in LA and we had dinner with Fred and Joanne Wilson and then went art shopping with Fred on Sunday. I spent a weekend in Dallas with my parents and went to Dairy Queen for Blizzard’s three times with my dad (my mom tagged along and even had a Blizzard one night.) I had dinner with my Uncle Charlie, Aunt Cindy, Cousin Jon, and his son Jack. You get the picture – even though the travel was intense I got some time with humans I love and don’t get to smell as often as I’d like to.

At the end of the trip, I spent two days at the Upfront Summit in LA. This comes on the heals of Upfront managing director Mark Suster’s great post titled Embracing Your Community as a Strategy  which I encourage you to read as it is magnificent.

I have a long relationship with LA. In my first company (Feld Technologies) my first large client was in LA (Bellflower Dental Group). While the company – a large 100 person dental practice – was based in Bellflower, the dentist that owned it lived in Mandeville Canyon and I usually stayed at his house when I was in LA (he was the step-father of a fraternity brother, which is how we got connected in the first place.) I drove a lot in LA and learned things like how the 10 connects to the 5 to the 605, or the 405 to the 605. I learned that if you left at the right time, each route was only 30 minutes, but if you left at the wrong time, it was over two hours. I heard about Wolfgang Puck before he was in airports everywhere. I enjoyed the non-meat dishes at Hamburger Heaven, went to The Palm when there was only one location, and hung out in Santa Monica before it was techie cool and the only thing around was Peter Norton.

Today, our current investments in LA include Oblong , Nix Hydra , and recently Two Bit Circus . In the last five years, there has been an explosion of startup activity in LA that continues to be exciting as the startup community grows and evolves. Mark and his gang at Upfront Ventures  are in the middle of it and are having a huge positive impact on things.

Over the last 20 years, I’ve attended and hosted many VC annual meetings. I’m an investor in many early stage VC funds  and, while I’m not a rigorous annual meeting attender, will go if one of the GPs asks me to. I always offer to be part of the content of whatever meeting / summit / dinner they do if it’s useful to them.

Since I was already in LA on Monday, I told Mark I’d stick around for the Summit if he thought it’d be useful to him and the team. He immediately programmed me into the content for Wednesday (LP/GP day) and Thursday (entrepreneur day ). Mark also invited me to the Upfront annual meeting given (a) our Next strategy and (b) my new partner Lindel Eakman being a prior investor in Upfront when he was at UTIMCO.

The annual meeting was solid and consistent with high quality annual meetings. But the Summit on the follow two days was easily the best VC-driven summit that I’ve ever attended. The content was incredibly high quality, diverse, and stimulating. There was plenty of networking time organized around the content. The venues were awesome. The coordination and organization was first class. The attendee list was dynamite. My understanding is that Mark / Upfront are going to post the content online and I’d encourage you to watch many of the videos when this happens.

It being LA, the special bonus things I got to do, like the one pictured below, was about as good as it gets. Yes, Kevin Spacey is extremely smart, interesting, and extremely articulate – as I expected, but there’s nothing like getting to spend a few minutes with someone you admire (he’s always been one of my favorite actors), but have never met.

Mark, Greg, Stuart, and gang – thank you for including me in this. You are doing amazing things in the LA startup community.

I woke up this morning in Fort Worth, Texas. For the first minute I wasn’t really sure where was I but it eventually snapped into focus. This happens to me periodically when I travel.

I’ve got a stretch where I’m on the road a lot. Fortunately, I’ve got amazing partners. I was reflecting on this over a cup of stale coffee this morning.

One of our deeply held beliefs at Foundry Group is that all four of us work on, and are responsible, for every company we are investors in. We don’t have silos where there are “Brad companies” or “Ryan companies” or “Seth companies” or “Jason companies.” In about 90% of the companies we are investors in, two of us are actively involved. In about 50%, three of us are actively involved. But in 100% of the cases, we all know what is going on, have relationships with the founders and CEO, and can quickly engage and help wherever and whenever we bring something to the mix.

As a result, we’ve always been active at moving primary responsibility for a company (which we define as a board seat) between partners. This is, in effect, a simple form of load balancing that we are all technically aware of from our early investments in some companies that generated, or used, very visible load balancing products before some of these technologies started to become absorbed into the core Internet infrastructure  (anyone remember early DNS round robin approaches?)

We have a full day offsite every quarter. One of the things we do is a full portfolio review. Part of that is a load balancing exercise. In addition, we do this exercise as each partner returns from their one month annual sabbatical, as the other three partners have already been handling that partner’s primary responsibilities.

The load balancing process is collaborative. We aren’t randomly moving companies around between us, but rather thinking hard about where a particular partner can help – both in terms of the specific company as well as reducing cognitive load on another partner.

We recently load balanced the companies I was primarily responsible for as (a) my load was excessive and (b) we knew I’d be on the road a lot in Q1. We made a few changes just before I went on sabbatical, talked about it a little more when I returned, and then made a few more changes two weeks ago.

As I sit here a little bleary eyed from the past few days, I realize how powerful this process is at many levels, most importantly eliminating any ego dynamics across the four of us when we think about the portfolio (as the load balancing includes a full range of companies – from those doing extremely well to those struggling.) And, I feel intense relief and satisfaction that I work with three partners who I trust as deeply as I do.

Over the years at Foundry Group we’ve built an extensive network of companies. While we’ve invested in some of these directly, this actually represents the smallest set of companies that we are involved with. We have also invested indirectly in many others through our investment in Techstars. Yet another, and much larger set of companies, come from our investments in other venture funds.

In 2013, we started thinking hard about the future of Foundry Group. When we started Foundry in 2006 we were very clear that we were not going to build a legacy firm. There would be no generational planning, no transitions to younger partners, and no senior partner hold-outs who would hang onto economics well after they had stopped working. Simply put, when we are done investing, we will drop the mic and shut off the lights.

During these discussions, we reflected on the incredible collection of early stage VC firms we’ve invested in personally over the years. We’ve been investing as individuals in venture firms going back almost 20 years. The four of us have served as mentors, and in a number of cases, formal advisors to funds around the world. In 2010 we started making the majority of our fund investments together through a common entity. While we never thought hard about this activity, over the years we’ve amassed a very strong track record through these fund investments. It’s also been fun – a great way to get close to new managers, build lasting personal relationships, and see deal flow for our Foundry Group investing activity.

In late 2014 the four of us got together to talk formally about the future of Foundry Group. We had each taken a month off in 2014 – well needed breaks after what had been a seven year sprint since starting Foundry Group. We were clear at that point that we wanted to continue to make early stage investments through a new Foundry Group fund, which we subsequently raised in the middle of 2015 and started investing at the end of the year.

At the same time we discussed our later stage investment strategy. In 2013 we raised a fund called Foundry Group Select. The strategy behind Select is to make late stage investments into successful companies where our early-stage funds had previously invested. The strategy has been a good one and with two early exits (Gnip and Fitbit) we’ve already returned significant capital.

As a result of our extensive networks, we constantly see other potential late stage investments. We’ve stayed away from these investments, not because they aren’t interesting, but because with the Select fund strategy we had limited ourselves to investing in existing Foundry portfolio companies. We broke this rule recently to make an investment in AvidXchange, a business run by an entrepreneur who I have known for over 20 years. The conversation around AvidXchange brought to light the magnitude of the opportunity we have to invest in interesting companies outside of our early stage portfolio.

We also had a long conversation about our GP fund investing strategy. It is clear to us that we enjoy investing in other VC funds and working to support the GPs. When we looked carefully at our track record, it became clear to us how lucrative this activity has been.

As we discussed the confluence of our fund investing strategy, our current Select strategy, and our interest in acting on our unique later stage deal flow, we realized that there was an opportunity to wrap these three ideas together into a single entity that would encompass not just what we had previously called our Select strategy but would also institutionalize our fund investment strategy as well as leverage those and other relationships to invest in other later stage opportunities in our broader network.

The critical ingredient for bringing this all together was finding the person to help us execute our GP fund strategy. Fortunately we knew exactly who we wanted to work on this project.

For the past 13 years, Lindel Eakman has been the head of UTIMCO’s private equity group. He’s created an incredible portfolio of investments in venture capital funds, including Union Square Ventures, Spark Capital, True Ventures, IA Ventures, Techstars Ventures, and Foundry Group. In April 2007, Lindel committed to be our largest investor in our first fund in 2007, taking 20% of the fund. This was a bold move, as we only had one commitment at the time.

Lindel – through UTIMCO – has continued to be our largest investor. He has been on our advisory board and for the past eight years has been a key advisor to us. Over the years he also has become a close friend.

We’ve been discussing this strategy with Lindel for most of the last year and have started calling the initiative “Foundry Group Next”. The Next strategy will not only allow us to continue making direct investments in high-potential startups, but will also scale-up our ability to support venture firms and funds whose vision and values align with ours. Through this activity, we hope to spread the Foundry Group values and DNA further into the overall venture and startup ecosystem.

We are pleased to welcome Lindel to Foundry Group Next and are excited to start this new chapter with him. And to make the the lawyers in our lives happy, we need to say that in no way is this blog post an offer to sell securities or an advertisement of us raising a new fund. We have yet to announce anything regarding any new funds that we may raise in the future.

Last Tuesday, while I was enjoying a week off the grid, AvidXchange announced they had raised a $225 million financing led by Bain Capital Ventures . I’m psyched to be joining the board of a company co-founded and run by Mike Praeger, a friend of mine for over 20 years.

It was big news in Charlotte, North Carolina where AvidXchange announced the groundbreaking on a new headquarters complex in the N.C. Music Factory. And, Matt Harris from Bain Capital Ventures wrote a good thought piece titled Submerging Payments, Part II on why AvidXchange is such a big deal.

This was an atypical investment for us as we participated in the financing through our Foundry Group Select fund . While we do late stage investments via Foundry Group Select, up to this point we’ve only used it to invest in companies we are already investors in. AvidXchange is our first Foundry Group Select investment that we weren’t previously investors in.

The price of admission for us to make an investment like this is that we think the company is extraordinary and will be an unambiguous long term market leader. But we see lots of late stage investment opportunities like that and consistently pass on them as it’s not where we engage. And, when Mike initially called me for advice on the financing he was putting together with Bain Capital Ventures, it didn’t even occur to me that it might be something we’d invest in.

But then Mike called me about some more stuff a week later. During this call, he asked if I’d be open to joining the board of directors as part of the financing. I told him that I couldn’t as we don’t join boards for companies that we aren’t investors in. Mike then asked if we’d be willing to invest if he could get Bain Capital Ventures to give us some of their allocation (they committed to the entire round.) I told Mike I didn’t think this made any sense given our strategy and we left it at that.

A few days later, Mike emailed and asked if he and his wife Cindy could come to Boulder to spend some time with me and Amy. We hadn’t seen each other in many years and it seemed like a fun evening if they were already traveling. A week later we had an awesome dinner at Oak and then Mike, Cindy, and I stayed up until after midnight at the St. Julien talking about AvidXchange. Mike again asked me if I’d consider investing. This time I told him I’d run it by my partners and get their feedback.

Seth, Jason, Ryan, and I had a long conversation about it after going through the AvidXchange financing deck and monthly financial package. I expected that we’d decide to pass and set up the conversation with them this way. But I was pleasantly surprised that they were all interested in exploring it more. Besides thinking this was an outstanding business at first blush, there were three other things that caused us to consider breaking our rule about late stage investing.

1. My long standing relationship with Mike. We met through YEO in Boston in the early 1990s when we were each running our first company. Through YEO, I got to know Mike and Cindy (who is also an entrepreneur and was in YEO) very well. A few years after Amy and I moved to Boulder, Mike and Cindy sold their first company and moved to North Carolina. Their experience in Charlotte has been similar to ours in Boulder, as they made it their home and immediately went to work building their next business and their life. In 2000, Mike co-founded AvidXchange and has been building it ever since. While we haven’t seen each other in person for a while, we periodically go back and forth on email and have a deep emotional intimacy that comes from the relationship we built through our time in YEO.

2. We are very interested in investing in fast growing companies in different geographies. When we started Foundry Group in 2007, we stated that we would invest in companies throughout the United States. While roughly 33% of our investments continue to be in California (San Francisco, Los Angeles, and a third city to be named in a week or so) and 33% of our investments are in Colorado (primarily Boulder and Denver), we have developed deep networks in many different cities, including Boston, New York, Seattle, Portland, and Minneapolis through the other 33% of the investments we’ve made. And, through our deep relationship with Techstars, our reach and network is even further and includes cities like Detroit, Kansas City, Austin, Chicago, San Antonio, and San Diego. When the opportunity to invest in one of the fastest growing, and most significant tech companies in Charlotte appeared, we couldn’t resist.

3. We could do our unique thing alongside one of the best fintech investors in the industry. We have enormous respect for Matt Harris and his work at Bain Capital Ventures. While this is the first time I’m working with Matt, my partner Seth has known him going all the way back to high school and Mark Solon, one of the managing partners at Techstars, worked with him during his time at Village Ventures. While fintech is not one of our themes, we think of AvidXchange as Glue in the fintech world, which gave us a comfortable lens to view it through.

Before making a decision to invest, we talked to each member of our advisory board to get their feedback. We knew we were onto something when several of them asked if they could invest alongside us in the round. Their feedback, as one would hope from an advisory board, was direct, clear, and ultimately supportive.

With that, we decided to invest and Mike got me to join the board after all.

A few weeks ago I reposted some great advice from Fred Wilson for pitching entrepreneurs:

“Fundraising is simple: find investors that get excited about your company.”

Our experience with Spare5 and their experience raising money from us, where we just led a $10 million Series A Financing together with Madrona Venture Group and New Enterprise Associates, fits this quote perfectly.

Matt Bencke, Spare5’s CEO, had a conversation last November with Jason. I remember Jason walking into my office and saying that he’d been thinking about something like this for a while and was super excited about how Matt was describing what Spare5 was going to do. Within a few days, Ryan, Seth and I also spoke with Matt and his co-founders and agreed to participate in their $3.25M Series Seed round .

While it helped that our long time friend Greg Gottesman had been working Matt for a while and that Spare5 was the first company to emerge from Greg’s Madrona Venture Labs project, Jason bouncing up and down about it in my office when describing his excitement to me was the real spark.

Since then the team at Spare5 has made great progress. We are psyched to be leading this round with the same VC team that made up the company’s first round. For the last several months we have had an insider’s view into Spare5’s progress, promise, and challenges. We love what we see.

Spare5 is bringing a unique approach to a massive problem that is riding huge trends. More and more companies are swimming in data – both signal and lots and lots of noise. Whether your company is posting content, selling online, training machines, and / or trying to understand what people think, you need human insights more than ever before. Spare5’s micro-task platform gathers targeted peoples’ inputs, and synthesizes them into valuable insights. The other side of this trend is the fact that we’re a society addicted to our smartphones. Spare5 aspires to give everyone a host of new choices about how to spend spare time productively and make a buck while doing it.

If you have dirty data or not enough of the good, actionable kind, check out http://www.spare5.com/product . If you are some particular combination of audacious, ambitious, and inspired check out www.spare5.com/jobs. And if you’re just plain nuts, download the iOS app and let Spare5 tap into your particular kind of crazy today.

Yesterday we closed our fifth fund, Foundry Venture Capital 2016, L.P.  As with all four of our other funds, it’s a $225 million fund.

In 2007 we raised our first fund – Foundry Venture Capital 2007 . We subsequently raised a $225 million fund in 2010 , another one in 2013 , and a late stage fund in 2013 . Our 2013 fund was originally raised in 2012, but we didn’t start investing it until 2013 so we renamed it 2013.

Except for our late stage fund, each of our funds has 30 investments (+/- 2) in it. Each is $225 million. Each is roughly invested 1/3rd into companies in Colorado, 1/3rd into companies in the bay area, and 1/3rd into companies in the rest of the US (Boston, NY, Seattle, LA, Portland, Austin, Minneapolis, Washington D.C., Burlington, and Phoenix.)

Our investment strategy has been unchanged since we raised our first fund in 2007. We are thematic investors , an approach we pioneered with a few other firms that today is trendy (and often mislabeled). We invest $5 million to $15 million in a company over its lifetime. We are early stage investors – if you’ve raised more than $3 million you are too late for us. We only invest in the US, but will invest anywhere in the US. We are syndication agnostic – we’ll invest with other VCs or invest by ourselves.

Our late stage fund gave us flexibility to invest more money in our later stage companies. We aren’t a growth investor, but rather interested in investing more money in our winners. This fund has already seen two big exits – Gnip and Fitbit .

We view our jobs as taking a box full of money that our investors give us and giving them back a bigger box full of more money over time. It’s pretty straightforward. We try to do this our own special way while having a lot of fun doing it. We have a small number of investors (around 20) who we appreciate deeply for supporting us in our journey.

And we couldn’t do any of this without the founders we get to work with. We appreciate them more than anything. Well, other than Jason’s musical abilities. For example: