Our Letter

Big Things Take Time.

The “factory” model of the last decade of venture investing and startups is over. In the 2010s, the investing world came to believe that capital, rather than endogenous factors (opportunity, timing, talent, markets, etc.), was the rate limiter on important (large, profitable, sustainable, durable, public, etc.) companies.

The thinking was, if we could only 10x or 100x the amount of capital invested into tech, we would see a commensurate increase in the number of large publicly traded “tech” companies. Public market investors were hungry for new issuance and growth stories, and so venture capitalists provided them en masse, via a factory system that prioritized repeatability, legibility, scale, and speed over quality.

Unicorns became abundant, everything was fundable, and the 18 month fundraising cycle (whereby founders and early-stage investors lived to serve the appetites of the “letter firms”) became the norm. This was an aberration. It is over and it’s not coming back anytime soon—nor would that be desirable.

Instead, it’s time to return to the historical patterns for entrepreneurship and venture investing. In the 2010s and into the Covid era, not only did low-quality business models become tolerable (or even desirable to VCs looking to deploy massive amounts of capital), but the business model of venture capital itself changed. Firms scaled themselves and created a new animal: the multi-asset venture platform. Venture capitalists got into the fee-rich asset management business and out of the underwriting practice. They came out of alignment with founders.

That has to and will change back - at least for us, having stayed focused and small. Tantamount to that posture/outlook is our belief that capital efficiency and sound businesses on the road to profitability should be the guiding light for companies spending our (risk) capital. Going forward, the best companies will control their own destinies and many may choose to skip Series A & B fundraises altogether rather than living and dying by the whims of downstream investors.

Important companies and successful businesses can’t be hacked, forced, or faked.

What We Do.

We lead seed and pre-seed rounds for startups across the US. We have invested in the earliest rounds of companies like Pillpack, Slack, Solana, Teamshares, Airtable, Ro, Venmo, Metropolis, Robinhood, Postmates, Livongo, and many more.

We are flexible on sector, round construction, and company structure. We are steadfast in what our money is for and how we help/work with our companies.

Ours is risk capital to fund rapid experimentation with significant, demonstrable results. Our capital is for experiments with discrete hypotheses in service of something big and important, the road to which is clear even if the odds are low or uncertain.

We help our portfolio companies by giving them money, advice, and access. We don’t have a platform or portfolio operations team. We don’t play pretend as part-time executives. We don’t meddle.

We advise our founders on capital markets: how, when, and if to take advantage of downstream capital, how not to be taken advantage of. We make sure our founders get in front of the right people at the right time, whatever the stage or type of capital they need. And we strive to help our founders become better capital allocators and the best investors in their own businesses over time.

We are venture capital investors in the classic sense.

Venture capital is not an amorphous concept that can be bent, molded, shaped to fit an agenda or narrative. It is not ‘in the eye of the beholder’. It is an absolute concept, with a history and a purpose.

The purpose of venture capital has 3 core components:

  1. Fund the experimentation to test a novel risk or hypothesis - true or false.
  2. Where a yes answer objectively and dramatically increases the value of the business.
  3. That you cannot fund any other way.

Ignore any one of those and history says it’s not venture capital and won’t perform like venture should (quick loss of small capital; major upside in short and long term).

We fund companies in their venture moments: when new capital can flip a card, reveal a truth, or power a step change up the mountain toward building an important, durable business. True venture capital isn’t about scale or sector; companies of all kinds can have multiple venture moments throughout their history. We aim to spot these - and spot the difference.

Contrast that with how the overwhelming majority of Venture Capital™ operates. As venture capital has grown from its humble beginnings to a Global Financial Asset Class, the majority of its AUM has become increasingly indistinguishable from minority growth equity or long only public funds. “Venture capitalists” bet that the data the company has already generated can replicate at more and more scale; they don’t bet on novel risk. As a result, Venture Capital™ has become a linear momentum game played for access by salespeople, not underwriters.

And why does it even matter? Isn’t this a distinction without a difference? No. Fit for purpose products perform better. Founders and LPs have suffered mightily from the confounded and blurred lines between venture capital and plain old capital.

What We Promise.

Our promise to our founders, limited partners, and partners is simple. We’ll tell you the truth and do what we think is best and right, even if it means going it alone or risks looking dumb.

We take the intelligent risk others can’t or won’t, providing risk capital to founders to be used to invest against novel hypotheses that can yield something important if we get it right.

We want to be maximally aligned with founders and help them become the best investors in their own businesses.

We use our skill set and perspective to be founders’ practiced “first mate” and help them navigate ever-choppier, more complex capital markets.

We work to bring the larger, later-stage firms along with us as we pursue new areas. As we take risks they can’t, we’ll educate them about what we’re doing and why, and help them become co-investors down the line.

We won’t waste your time but we’ll never rush. We reserve the right to be slow when appropriate and go fast when we need to.

We work as a team with no individual credit or track record for deals. When you work with one of us, you’ll work with all of us.