Expa Labs 2017 Companies
We started Expa Labs to help founders build and ship new ideas. By providing fundamental help in starting and structuring their company, providing office space, funding, and advising, we take a very hands on approach. We do this by working with a smaller group of companies.
Building off of our learnings from 2016, we expanded the program to better suit the needs of entrepreneurs. Just like a startup, Expa continues to iterate on making our program better for the creation and scaling of companies. After reviewing over 1,000 companies and meeting with less than 5% for final interviews, we are happy to start the 2017 program working with an incredible group of founders. Earlier today we announced this at Expa.com.
- Interseller: Make contact with new prospects
- Merlin Guides: Magically Simple Employee Training
- NextGig: Actionable information about companies in your professional network
- Sleeperbot: Messaging for sports fans
- SuperHi: Learn to code and create websites from scratch with our online 8-week course
- A stealth neural training company
(PS — if you are looking for great companies to join, take a look at each companies above to see where openings are available.)
With the lede out of the way, I wanted to share more about the process ourteam went through to review and select the Expa Labs 2017 companies. I also want to share my own learnings and how they will impact me going forward.
This year we received ~1,000 applications, spoke to countless teams in person, by phone, and email, and invited 36 teams to interview with us in person. The fundamental question guiding our decision process was: can we help this company be successful? Beyond funding, what can we do to work with this team to make a meaningful 10X difference in the trajectory of their early start? We don’t believe in just writing a check, but rather working closely with founders who we can help, that are coachable, to build and ship great products. In some cases, we gained enough conviction to move forward, and in others we did not.
One of the main things I struggle with (and expect I always will) is turning teams down. It is never easy to say no, but I feel it’s always better to give a clear answer rather than string a team along. Sometimes it has nothing to do with the team or the business, but rather entirely on the potential investor. In the case of Expa, it is usually a combination of things that may include:
- Competitive to one of our Expa Studio companies
- Competitive to one of our stealth studio companies
- Competitive to another investment
- We don’t have enough domain expertise to truly help the founders
- We cannot make a 10X difference for the founders/company in the first 6 months (as mentioned above)
- We are just wrong
On the final point I want to recognize that with ~1,000 applications we might simply miss something great. The default answer in the early stage investing business is “no” and this shouldn’t deter you from building your vision. Anyone who ever says otherwise isn’t being realistic because many great things don’t appear that way at the earliest stages. I hope for all applicants this process was a good experience, and as I have said before, a helpful part of the early stage journey.
Time well spent
Many folks asked me “How can you justify going through that many applications and spending all that time?” and I have a very easy answer: it is exactly what I want to be doing. Yes, it takes time that could be spent actively working with existing companies but ultimately it will help them in the long run.
There is a great WaitButWhy post about how you spend your time (take a minute to read through that) that really got me thinking about how I spent my time earlier this year. It outlines a “lifetime” in weeks, months, and years and encourages folks to fill in the blank template provided.
Here is what WBW came up with:
And they provide a handy template so I decided to do a basic one of my own:
How I want to spend my time in green
One of the best parts about this process has been seeing how it aligns with my own goals of helping and coaching early stage founders and companies. My time so far has been spent as an operator, an investor, and now a hybrid of the two. I realized this blend fits my own long term goal become a great advisor to companies.
From an investing perspective I also wanted to breakdown some of this time:
Of the 1,000 applications and I can filter them down into three categories:
1/3 probably not a fit
1/3 probably not a venture scale opportunity
1/3 probably a great company
Using some back of the napkin math, I came up with what I believe are what a top tier VC firm/Partner could see in a year which is about 86 great companies.
(there are 365 days in a year, with about 260 working days, and perhaps they could see 3 amazing pitches per week (that’s a lot!) that are investable, which means they see 86 venture scale incredible companies in a given year. This is balanced against companies that are not a fit or not venture scale.)
Therefore, using the math above, I compressed about 3–4 years of pitches into this period (333 great companies/86 per year = 3.8 years to see that many companies). This is obviously not perfect. I imagine, over the course of a 3+ year period, I would be able to replicate what we accomplished over the last few months. This entire process helped me continue to develop my own pattern recognition.
Each application provided a video pitch, written overview and detailed answers to questions. Going through applications fulfilled our commitment to treat the people who spent time and energy putting these materials together with respect. Personally I wish I had more time to provide individual feedback for every applicant, but that simply doesn’t scale.
In the end we are thrilled to have found some amazing companies to join the Expa family, who are already hard at work with our Partners and the team. I can’t wait to see what these founders build and launch in the coming months and I am excited to work with each of them.
Originally published at Eric Friedman.