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When I first became a VC, seed rounds were typically $500k – $1.5 There weren’t a lot of seedfunds in 2007 so this was often done by angels, funding consortia or sometimes early-stage funds that existed then (First Round Capital, True Ventures, SoftTech VC, etc.). Why the latter? So back to reality.
These tensions seep out in some angels or seedfunds publicly or semi-privately deriding later-stage VCs for their “bad” behavior. Or your A-round investor who wrote a $5 million for 25% of your company may not be well positioned to write another $5 million (25%) of a $20 million round.
Well, a down round is even more complicated than having no demand for your investment round. If we count seedfunds and large angels maybe that number goes up by 2x? They should either believe in you and your business or not, but I promise you I’ve seen this type of behavior repeatedly over the past 15 years. A down round.
It’s true the some VCs have started writing so many checks that they resemble stock pickers but the majority of us still have less than 10 board seats at any time and tend to go pretty deep so the result is that we care deeply about where we commit our time. Was there consumer demand? No brainer.
This has been especially true for angels or seed investors as there is a new thesis that less capital is needed to start Internet companies so more money is being spent at this phase of the funding lifecycle. While not 1999 all over again but I am observing first-hand the signs of funding frenzy.
Brad was openly writing about this and it felt like he was giving the VC playbook away for free! We write about $40 million of first-checks into new deals / year and about $40 million of follow-on investments. Of course a group of 10 seedfunds can’t fix the prices of a market. The Laws of Supply & Demand.
Available seedfunding, check; another one down for the startup ecosystem checklist. Nasser explains their project, Eightshit.me , a goofy crowdsourced Twitter avatar tool that received some traction and a write up in Fast Company. “We We had so much demand that we had to shut down the office for a week and draw shitty avatars.
Many times I think that it would be awesome to have a conversation with them, but typically write off the idea because the process for access is too difficult. Any funding yet? We have received seedfunding from a friend and it is personally funded. That’s cool! What is your business model?
Available seedfunding, check; another one down for the startup ecosystem checklist. Nasser explains their project, Eightshit.me , a goofy crowdsourced Twitter avatar tool that received some traction and a write up in Fast Company. “We We had so much demand that we had to shut down the office for a week and draw shitty avatars.
Whatever the biggest, most challenging, most demanding, most important job we had at L90, I always turned to Tim. He went from recruiter to IT manager to technical sales… Then, he did such a great job in sales that we had to build up more infrastructure for our ad-serving and email delivery platform to support the increased demand.
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