Crescent Ridge 10 year anniversary

A decade of early stage investing in review — our top takeaways-

2022 marks the 10 year anniversary of Crescent Ridge and my 17th year in venture capital. Over the past decade, we’ve invested in 66 companies with 9 exits, 12 write-offs, and 45 still kicking. I’m proud of the diversity in our portfolio as well: 36 women founders (>50%), 14 founders of color (>20%), and 5 founders who identify as LGBTQ+ (>5%). It’s hard to believe we’ve already hit the 10 year milestone, and I hope it’s the first of many more.

I am filled with gratitude for everyone who has contributed to the past 10 years: our team, the incredible portfolio company founders, and the many mentors and advisors who have helped along the way. And I’m so grateful to my partner Maria Gonzalez-Blanch, who joined me in 2020 to help develop and formalize our investment strategy.

When I started Crescent Ridge Partners in October of 2012, the startup/venture landscape was completely different from what it is today. Facebook had just gone public, the term Unicorn hadn’t even been created, and total venture capital investment for the year was a measly $41B; a whopping 8 times lower than what it was in 2021! Over the last several years, Maria and I have learned a great deal about the market, ourselves, and startup investing. These are our top takeaways. We will do a deeper dive on each of these once a month in 2023:

1. Articulating our definition of success and finding founders who align with it is key to a successful investor/entrepreneur partnership.
2. Capital efficiency is the name of our game.
3. Resource constraints spark creativity.
4. Betting on founders who don’t fit the traditional mold requires a nontraditional approach to building and funding a company.
5. Finding true product market fit is challenging to do, rare to find, and the key to unlocking revenue.
6. Strengthening relationships is more rewarding than maximizing our financial return.
7. There’s an increasing tension between advancing technology, getting rich, and preserving what makes us human.
8. The best ideas, technology, and team don’t always win.
9. Our own biases unintentionally lead us to miss out on investing in great leaders.
10. Groupthink is rampant and dangerous, and we are not exempt from it.
11. A growth mindset is crucial to entrepreneurs’ success: Balancing determination with flexibility, knowing when to listen to others and when not to.
12. Sticking to your investment thesis is crucial, but don’t be afraid to listen to your intuition if it tells you something different.

We have accomplished a lot and learned a lot in our first 10 years in business. Looking ahead to the next 10 years, we’re focusing our investments on founders building startups that prioritize profitability, purpose, and responsible growth. There’s even a term for this — it’s called “Zebras”. This is a different strategy than chasing unicorns. In contrast to the typical venture capital model where only 1 in 10 startups hit it big, our goal is for 9 in 10 startups to succeed.

We’ve established three goals that will help us stay focused on funding Zebras, and get us to our objective of 90% success:

1. Our first goal is to identify and partner with founders who would like to reduce their reliance on venture capital funding over time.
2. Our second goal is to collaborate with these founders to create an expansive definition of wealth and success.
3. And finally, our third goal is to develop new patterns of leadership as we will have a healthy portfolio of founders who have started, built, and grown profitable, thriving businesses.

We could not have accomplished this much without our incredible portfolio founders, co-investors, mentors, collaborators and the thriving start-up community in San Diego and beyond.

We are very excited for many more decades to come!