Riding a Rocketship, Volume II
Thoughts on the past, present, and future of Brand Foundry (and venture capital), Year 2.
As I finally am putting fingers to keyboard for the second edition of my personal annual report (first one is here), I realized (in between my second cup of coffee and my newfound love for Wilco on the Echo— thanks, Huckberry! I have no idea why i never listened to Jeff and co before) that this story was supposed to be published in March.
Yeah, I know. I’m just a LITTLE late. Especially after publishing this back in February in between some frustrating meetings.
So why the delay? Andrew and I got swept into a hurricane of a slog that is fundraising (which I’ll address below in the report). That, and some personal difficulties came into effect. But as a wonderful quote I grabbed from Postsecret once said:
You have to get to the worst times to get to the best.
But enough intro talk. Let’s do this.
On Ghosting and “Laziness”: Many investors are culprits to this. I definitely sadly have done more than I should. (NOTE: If I have ghosted you, founder, please call me out on it. Seriously.) The fact that we cannot dutifully get back to founders after great conversations or even just drop the ball is inexcusable. I don’t truly understand why we keep committing this sin (with only some serious exceptions, but VERY few), but this topic leads to a bigger situation that I mentioned last year: founders work 7 days a week slogging away to build the future and investors are unfortunately getting lazier and not holding up their side of the conversation. We have to do better. We can “find the time” to be genuine, even if it’s having to pass on the company. We just need to stop dragging along founders like the cans tied behind a “Just Married” car. That analogy, sickeningly enough, can actually be used to paint some investors in general: show a rosy, pretty picture in the car to their Limited Partners without them seeing the dragging of founders, the ugly side, that they’re doing in the back.
And speaking of that point on “finding the time…”
Transactional Mentoring is Bullshit: I have seen top people in the industry complain that going to various organizations, helping them, volunteering for them, has been more of a waste of time for them than productive unless there’s “something in it for them.” Ok, yes, I get that part of your job is to source for dealflow and find some great founders and startups out there. But you also have time to eat, time to shower, time to take your damn SoulCycle class or brunch with your friends on the weekends or travel to Europe, the coasts, or to party towns. Maybe instead of tagging your delicious avocado toast on Instagram, you could actually take the time out of your fucking “busy” schedule and help actually contribute to this startup ecosystem. Don’t always look for “what’s in it for me” when you’re getting opportunities to help. You know what’s in it for you? Actually helping people instead of your ego.
On Valuations: Yes, they’re dropped. No, it’s not doom and gloom. No, the bubble’s not bursting. Yes, fundraising sucks. But most importantly, yes, the true founders who are building viable businesses and not silly ideas will truly succeed from the change from 2015 to 2016. Wannable founders and wannabe investors will be weeded out and the true architects will be discovered. Now THAT excites me. Speaking of true architects…
Lady Founders and Beyond: We’re proud to be backing 14 female founders across 9 female-led companies (out of the 16 total in Brand Foundry’s portfolio). The better part about this news is that more investors are putting money into #BADAXXES, especially now that there’s more data proving that women are killing it more returns-wise than male-led startups. Let’s keep this awesome growth happening!
That said, it’s also important to see the rise of great organizations in other spaces of founders. Some I’ve been involved with over the past year: StartOut has done wonders for LGBT founders, Startup52 has been pushing hard into diversity in tech, and NYU and Techstars have been building programs for military veterans. You’re also seeing more programs for younger founders, like the Next Gen Summit!
Friends But Not Good Friends: Last year I talked about the fractured relationship between tech journalists and founders. Has it gotten better? Absolutely, especially as the new media space continues to consolidate and drive more towards stronger content. That said, we still have issues with bad apples in the tech sector getting more of the storylines to the mainstream. The bigger solution here is that there needs to be a better open conversation between the tech world and the media, because the real story that will then get the mainstream press comfortable is on how these often unique and complex ideas, concepts, and products actually MATTER to the average person. How can founders cross the rope bridge where the other side is mass market revenue and acceptance by that aforementioned mainstream person? The media can help.
Fundraising, Man: The processes for venture firms and founders for raising capital are quite different, especially on where the sources of funding can come from. But one point I cannot stress enough is that while they’re different, they are both absolutely equally difficult in their own ways. That said, it’s been an absolute slog, and if you don’t believe that raising money for investment is hard, ask the Crosscut team. Also, the head of a major VC firm in NYC once told me that he had to go to over 400 potential investors to raise one of their most successful funds. It’s not fun out there, but as Andrew and I keep leaning to our operational and behind-the-scenes backgrounds and track records to showcase to potential investors, it’s what we also realize can help us determine the best Limited Partners for us.
Oh, and a quick update: still not LIVIN DAT RYCH VC LYFE. :-)
Finally, I’ve been a bit irked watching a bunch of investors write countless blog posts when I feel they should be helping founders with that time. Over the past year, though, and especially over the past few months, I have realized actually how useful a lot of those stories have been. With more people building newsletters and more tools out there helping to connect information together, along with the fantastic Research Dives our summer associate Andrew Donnantuono has been putting together, I am going to start writing a lot more online along with my various posts on Twitter. Stay tuned.
I continue to be speechless when I realize I’m in this great line of work that is venture capital. I’m going to keep doing everything i can to help the startup world keep growing and help young founders succeed. It’s something that we as investors should always commit to do. As we in this industry continue to climb the mountain towards our goals, it’s lonely at the top, and we should turn around and help others struggling climb up so we can succeed as a team and as a group. Everyone wins.
