Founders First Fund & Lots of False Starts
Back in 2019, I decided I would announce that I was launching a new venture fund called 1859 Ventures. The thought was that I would focus on Oregon's underrepresented founders and be the first to commit money to their technology startups.
Then the pandemic hit and everything tanked. People who committed funds into 1859 came back and told me, “I am reassessing my cash position.” I got that email more and more as the pandemic lingered. The other email I got was from founders who were constantly curious when this thing was going to actually happen. It was a gut punch and one I spent a few years trying to figure out a path forward.
Eventually, I realized that there was no way to get that fund off the ground. Too much time had passed, the name seemed to create issues with its association with Oregon’s complicated racial past, and finding another GP for the fund seemed like an impossible task. It was one disappointing turn after another. So I let it die.
Months went by and there were a number of false starts. I’d find a few interested people who wanted to do something, but it was a matter of bad timing, cold feet, other obligations, or just not wanting to impact their standing in the ecosystem should the fund not pan out the way they had hoped. And I totally understood the trepidation. I mean, I am asking people to put their money and their faith into me in deciding which companies the fund would invest in and that could have the best chance for a high return. It’s a lot of pressure and something I spent a lot of time wondering if I was actually ready myself and if these false starts were just fate telling me to quit before I even got started. I would be lying if I did not admit that this was a little frustrating.
I had watched as a number of incredible founders grew their companies, opened an early funding round, and were disappointed to hear that the fund just couldn’t get off the ground or that another fund may be on the horizon if I could just get things sorted out. I felt like an imposter and a fraud walking around saying that this fund was going to happen, only to see things once again fall through my fingertips.
And then something happened. I discovered that I do not need to wait for anything or anyone. That I could go out and do exactly what I had been telling founders to do for years. Just get out there and build it, even if it’s super small. Don’t try to do too much, but do what you can. Eventually, you will get to a point where you will be able to grow and the available resources will enable you to do more.
So I am super excited to announce the launch of a new fund, the Founders First Fund is launching this fall and I anticipate the first close will allow me to begin funding companies by the end of the calendar year. Fingers crossed.
Now of course a lot of things can happen, but I am bullish that the third time is a charm and that I’ll finally get the ball rolling. I have been on countless calls with potential LPs who are eager to see this happen and it’s making me excited for the future.
A few things first. I know a lot of people are asking, “What’s going to happen to ______________?” With this being a small fund (targeting $5M) my focus will continue to be on my work at NSIN and continuing to help Oregon’s vibrant startup ecosystem through the UpStart Collective, Demolicious, and founder.coffee. I do not believe that this fund is going to take a tremendous amount of time away from the other work I am doing and feel as though this fund is complimentary to many of the other things I am working on. Plus, my little ADHD brain needs to be fed all the work it can handle!
If you haven’t seen it already, 1859.vc has been modified to include the new fund information. The major takeaway is that Founders First Fund will not be just focused here in the state of Oregon, but rather the entire Pacific Northwest region. It will also focus on three key industry verticals.
- Deep Tech
- B2B SaaS
- FinTech
Why those industry sectors? Well, there are a few reasons. The first is that Portland (and Oregon in general) is known to have a tremendous pool of talent in these three areas. Given our geographical location, we also have a lot of talent in B2B SaaS and Deep Tech. I may deviate from this from time to time as I find founders I believe are working on a big global problem, they are thought leaders in their space, and have an incredibly thought-out plan to scale. It’s important to note that not every startup is venture scale. Perhaps I will touch on that in another post.
As I think back over the past several years, I am thankful for the guidance and advice I have received from many of my fund manager friends as well as seasoned investors who have accomplished far more than I have in my career. The best piece of advice I got was to understand your “why.” Getting into venture capital is hard enough, but if you are not defining your north star then you are making the task much more difficult.
So what’s my “why?” If you have been following me for some time you know that I was a founder myself. Aside from co-founding a B2B SaaS company, I had been the co-founder of a digital studio and worked as part of a DoD innovation team working to model wireless power. These experiences made me understand more about the gap that exists for early-stage startups. A gap that is much bigger in the Pacific Northwest given our incredible lack of pre-seed and seed funding resources.
When I was a founder fundraising in the area what I found both fascinating and frustrating was watching as many of the area funds would sit around waiting to see who would invest in a company first. Then, and only then, they would possibly commit to a small amount of capital into those companies. But the frustration didn’t stop there. Many of the funds were making founders go through a due diligence process that was cumbersome, tedious, lengthy, and completely unnecessary. I chalk it up to a mix of risk aversion, lack of founder empathy, and thinking that because they’re one of the few funds writing checks in the area they can come up with a process that makes sense for their firm.
Founders First Fund aims to be the first institutional commitment into an early-stage startup so that we can get them the help they need to continue to scale, give them guidance, resources, and (most importantly) just get the fuck out of their way.
Over the next few months, I’ll be scheduling some AMAs, webinars, and 1:1s with people curious about what it means to be a part of the Founders First Fund. In the meantime, if you are curious to learn more, you can reach out at carter.josh@foundersfirst.vc. I am bullish on the Pacific Northwest and its founders. Whether it's through the work I am already doing or the events I am either attending or putting together, I am always pleasantly surprised when I meet a new founder I have not yet met and who is working on something incredibly important.
Let’s go!
