Santa Claus as a Founder — Is he worth an Investment?

A short assessment based on Paul Graham‘s 5 most important founder qualities Y Combinator looks at before investing.

It is this time of the year again. Everybody is tired of listening to Last Christmas and gained at least a few pounds in pure gingerbread and cookies already.

As a venture capitalist, we are always looking for good investment opportunities. We are looking for the special founders, the ones with high potential, the ones who are different and not just selling another “very different and organic and tasty and healthy and awesome mulled wine”. So why not take a closer look at Santa Claus.

Sure, he already has something quite big going, but come on it is just once a year and has he even turned it profitable yet? No profit after such a long time and the growth rate of his customers is around one percent at best. All alarm clocks should be ringing. It is Christmas time though, why not give him a chance.

Based on the assumption Santa comes up with a new business idea and asks for a seed investment from First Momentum Ventures, we took a closer look on his qualities as a founder (without details about the idea) based on “the five most important qualities of a founder” as Paul Graham, co-founder of Y Combinator sees them. You can find them here.

We took the qualities as a basis for the five categories we assessed him on. In each category, we awarded a gingerbread man if Santa fulfills the quality.

The five qualities are:

• Determination
• Flexibility
• Imagination
• Naughtiness
• Friendship

First, there is Determination. Being a founder is hard and it needs a lot of it to overcome all the challenges on the path to success. Santa travels around the world year after year in the same night to deliver the presents, no matter how the weather does look like or which other obstacles he has to overcome. Everybody has to agree that this means he has to have a lot of determination.

Second, Flexibility. Life and especially the path to a successful business does not always go as expected and a founder needs to be flexible enough to take, sometimes uncommon, turns and twists. It is always the same night a year, it is always the same sled with the same reindeer, it is always the same outfit and most importantly, it is always the same concept behind Santa‘s business. Based on the information we have access to, it is hard to attest Santa enough flexibility to receive a gingerbread man in this category.

Third, Imagination is important. Great ideas are crazy most of the time and it needs a lot of imagination to start and keep believing in them. Santa started his worldwide business from the North Pole without great infrastructure or anything else. He built it up all on his own with his vision always in mind. Definitely worth a gingerbread man.

Furthermore, Naughtiness plays a role. Not as naughty in sexy Santa thoughts, but more in a sense of breaking the system, that it works the way one needs it. Santa found his very own helpful hack by turning a sled into a unique “amphibious vehicle“ to help him exactly the way Santa needs the tool. We would say naughtiness can be ticked.

Lastly, there is Friendship. To be successful, one always needs a team, either in the form of co-founders or associates or valuable partners. Living together in the dreariness with all the reindeer and the Christmas elves without a notable protest or other incidents suggests strong friendship. He would probably even share the gingerbread man we award him in this category.

To sum it up, according to our proven assessment process for Santa Clauses we would certify him with 4 out of 5 possible gingerbread men. It is a quite good score and who knows what idea Santa comes up with, but First Momentum Ventures would be willing to invest probably. 😉

Lastly, we from First Momentum Ventures thank you all for the past year, wish you a Merry Christmas, some relaxing holidays and a good start into the new year 2019.

As a pre-seed investor, we help your startup to gain its first momentum by backing you with a first investment as well as world-class mentoring, a strong community, and the required know-how. Read more at firstmomentum.vc, stay up-to-date with our newsletter or get in touch through Twitter, Facebook or LinkedIn