Our Investment Thesis
As a founder, time is your scarcest resource. We promise not to waste it. Here’s how to know if asking us for money is a good use of your time:
- We don’t just invest in companies, we back specific teams of founders. That means we can only work with teams that we believe have the combined skill, grit, intelligence, insight and leadership ability to build a really big business.
- Even the most exceptional individuals can’t cover all these bases, so solo founders are (usually) a red flag for us.
- As software investors, technical product execution is at the heart of the companies we back. By extension, a software company without technical founders isn’t really a software company.
- Teams that can spot valuable problems and build products to solve them are always interesting, but we lean in most strongly with founders who are on fire to prove themselves.
- Successful founders have to be good at overcoming obstacles, and people from traditionally marginalized groups — women, people of color, LGBTQ+ — have had to do that their entire lives. We see and respect that achievement just as much as any school or job title.
- We love founders and want to help them in any way we can, but as fund managers we’re on the hook for producing returns: if we don’t believe an investment has a chance of returning the entire fund — with all the risk and dilution we’ve learned to expect along the way — we can’t make it, no matter how much we like you.
- Venture returns are driven by a small number of extraordinary companies — those that come to dominate the category of opportunity they choose to attack. We’re drawn to founders that show they understand this — both in the opportunities they pursue, and in the way they pursue them.
- “Scratching your own itch” isn’t usually a good source of startup ideas, especially if your life experience is limited. We like entrepreneurs who combine deep domain expertise, imagination, and listening skills to uncover big opportunities in places most people wouldn’t think to look.
- We’re drawn to opportunities where real customer problems are solved and real money changes hands for value created. We’re no good at ad-supported or other indirect business models where the customer and the user aren’t the same person.
- The name keeps changing (right now it’s called “pre-seed” or “seed”) but we prefer to be the first institutional check into a company, and to own enough that it matters to our returns. In practice, this means everywhere from just (team + idea) all the way to a (team + product + first customers).
- We typically invest $750K-$1.5M in a company’s first fundraise of $1M-$3M. We reserve for follow-on, and will support our successful investments up to a self-imposed limit of 10% of total fund capital.
- Sometimes we invest by ourselves, but we also like to work with other professional seed-stage investors who have complementary skills and networks, especially out-of-region funds who share our conviction in the Pacific Northwest.
- Our mission is to help exceptional entrepreneurs navigate the often-rocky road from initial idea to a high-quality Series A, led by the most effective partner at the best VC firm for their specific opportunity. We don’t disappear after Series A, but if we’ve done our job right the new investors will be much better at helping you through that next stage of growth than we are.
- We’re based in Seattle and have a strong preference for companies located in Cascadia — from Portland, OR up through Vancouver, BC. We know that globally significant public tech companies will continue to be built here and we want to help make that happen over and over again.
- When we invest outside the region (which we do about 10% of the time), it’s usually because we had a prior relationship with the founders that allowed us to get to conviction about the team despite their remote location.
- We believe that world-class companies can be built anywhere, but we also believe that most successful companies will ultimately need to raise from a major money center like the Bay Area or New York City. Helping our portfolio companies succeed with high-quality follow-on investors is a core part of our work.
If you’re out raising money for your startup it’s useful to remember that investment funds aren’t (generally) operating companies — they’re partnerships, and the partners are just ordinary human beings, with all the quirks and peculiarities that come with that. Our work as investors is highly personal — we do it because we love it — and the values that guide our decisions reflect who we are as humans (for better or worse). We hope this post makes it easier to understand how we approach that work— and by putting it out there we’re also deliberately inviting you to challenge our thinking so we can get smarter and better at what we do.