We like to be simple and transparent with how we invest in founders and their startups.
After we meet, we will ask you to do a few things:
++ Review the our term sheet.
We want you to be familiar with our term sheet so there are no surprises later. We encourage you to get educated on the venture investment terms with your lawyer. We like Brad Feld’s Venture Deals book for explaining such things in plain english.
The terms are designed to be founder friendly, and plain vanilla. They are based on the Series Seed documents to keep things nice and standardized. This is important for future investors so nothing looks odd or out of the ordinary. Raising capital is hard enough.
++ Complete the due diligence.
The due diligence document is a laundry list of things that we would like to see (e.g., financials, corp docs, beta/customer lists, ….) This helps us get a good sense of where your startup stands today. Also, this makes our subsequent questions and conversations more productive.
++ Figure out valuation.
We use this simple seed investment calculator to see the interplay between pre-money valuation, investment and option pool size. Valuation matters but building a startup is a long journey. We like entrepreneurs who focus less on the starting line and more on the journey (but of course, we would say that.)
Finally, of course, conversations conversations conversations. We want to know you. Ultimately, we are investing in you the entrepreneur more than your startup. Ideas are a dime a dozen. Products are a buck. But, persistent smart entrepreneurs who can make things happen, despite the world saying they can’t, are priceless.