Investing in, and working with, great entrepreneurs at the very early stage of development of their companies is what we do, first and foremost. For over 3 years now, our focus has been the consumer Internet space (now dubbed “Web 2.0”) and we plan to continue doing so for the foreseeable future. By investing in 20+ Web 2.0 startups, we have learned a lot about this still developing market, that has helped us refine our strategy and the segments (we call them “buckets”) that we are interested in. However, like any investor, we will remain opportunistic and we’ll do a few deals that are outside of our area of expertise — just because we like the team, the opportunity and we feel that it is worth the risk.
The diagram on the right summarizes these 5 core “buckets”, in which we have develop a prior expertise and track record — either by investing or taking companies all the way through to exits.
The “New” bucket is there because we want to be honest about the fact that we will enter new areas that might become one of the core buckets in the future.
Early stage technology investing is an art, not a science, and it is therefore difficult to list explicit criteria, metrics and thresholds. We can however provide a list of data points regarding our overall strategy for the fund:
• invest in 30 to 40 seed stage startups
• average “bite size” of $250K, ranging from $100K to $500K
• able to lead, co-lead or follow other firms or angel syndicates
• focusing on consumer Internet, but with a great flexibility to enter new sectors opportunistically
• open to a few non Silicon Valley deals
• capital efficiency, great teams, differentiated ideas and flexibility on “how big it can become” will be common characteristics shared by the companies we invest in
• working hand in hand with the best firms in Silicon Valley, and the usual suspects in the acquisition gang, to build a successful outcome for everyone involved