Investment Philosophy

A snapshot of what we value and how we operate.

Information Technology

We like Information Technology companies. Our focus on IT gives us a stroke broad enough to invest in themes we know, and flexible enough for us to add a little here and subtract a little there. It's all about balance.

Founders (Technical & Design)

We like technical founding teams; especially technical teams who are design-driven. The combination of being both technical and design-driven typically yields the best outcomes in the modern early-stage startup.

Addressable Market

We're less interested in a particular company's market size (total revenue generated in a particular segment of the economy) than we are in the size of a true addressable market (total potential revenue that a company could generate if it were to acquire every customer).

Grounded In Customer Dev

In early-stage startups, traditional product development methodologies are flawed. We subscribe to Steve Blank's Customer Development Methodology which is a framework for building products by first developing customers and markets.

Geographies

While there are intriguing opportunities all over the world, we focus our efforts in North America. With some exceptions, we do most of our business in the tech hubs of the Bay Area, NYC and So Cal. We also have an eye on emerging hubs like Seattle, Vancouver, Austin, Boston and Chicago.

High Velocity

In physics, velocity is the rate of change of position. It is a vector physical quantity that requires both speed and direction. In startup, Velocity is King! Arriving at results faster is better, good or bad.

Capital Efficient Startups

Capital efficiency in the early stages is key to commercial success. When a company is trying to take off, it's critical to reserve plenty of runway by keeping the burn low. It's a discipline we like to see. This lean thinking is best described by Eric Reis' Lean-Startup Movement.

Smaller Initial Bets

Building a startup in today's world is different. Where it might have taken $5 Million to start a company in days gone by, today that same company could be launched for $500K or less. We like to bet on small teams that use emerging development frameworks and cost efficient distribution, and can take smaller amounts of capital to make something real.

Flexible Investment Structures

We typically invest alongside Angels and early-stage venture firms. We provide initial funding ranging from $51K to $500K for seed- and early-stage startups. We don't require a seat on the board and we look for reasonable terms on both sides of the equation.

Exit Flexibility

Leaner, up-front investments create a greater range of exit strategies where everyone wins (founders & investors). The economics of our fund are not driven by homeruns or moonshots. We're fine with early exits, but we also support the opportunity to scale.

Defensibility (a la Data)

We look for defensibility in innovative platforms, tools, and technologies that are managing and extracting value from data. Data drives the new intellectual property of today's startup. Business models dependent on network effects and data are amazingly defensible.

User Experienc(ed)

Understanding design and how people will interact with your product is crucial. We value user experience as a key differentiator in the way products go to market and stay ahead of the competition. The UX-Driven startup is the bedrock of the modern day product.

Metrics Driven

In the world of customer and startup metrics, the only sure thing is that your startup needs to be metrics-driven. Depending on whether you are striving to achieve product-market fit, or scaling for revenue, your company needs to be high-centered on key metrics.

Agile Advisory

As entrepreneurs ourselves, we have found that, when it comes to seed- and early-stage rounds, the best boards are Agile boards. In many cases, an Agile Advisory Board is the critical component needed to establish "value creation" and "alignment."

Business Plans & Unicorns

A business plan is a waste of time. It's often plagued with unicorn math, which is simply a prediction of the future that becomes obsolete the minute it's saved and printed. We prefer to have a conversation about the team, the addressable market, market feedback and supporting metrics. Save the spreadsheets for the bankers. They love that stuff!

OUR FOCUS