To celebrate Mystery’s blockbuster Series A fundraise led by Greylock Partners we decided to review and reflect on the April 2019 investment memo that we wrote in support of our first $500k investment into the company. To date, we’ve now invested $2.5m, a full 10% of our fund. Our third “all-in” position, alongside and

Spoilers are no fun, but also videos aren’t for everyone. In the video we reveal that you can be wrong about literally all the risks of a startup as long as you’re right about its key strengths — specifically the founders’ bedrock capabilities as humans, and the insights and convictions they’ve developed on their journey to starting a new company. Most folks will call what Mystery pulled off a pivot, but we call it a focus. What was true and got us excited about investing three years ago is even more true today than it was back then.

Onward Mystery!

Only two-and-a-half years ago we welcomed Vetri and into the Founders’ Co-op family. Today, we’re congratulating them on joining the Microsoft family, where their vision to bring purpose and alignment to the employee experience will continue towards global scale, but now on a radically accelerated timetable. While we’ll miss spending time in the trenches with’s fantastic leadership team in this next stage of their growth, Microsoft is and always was the perfect long term partner for them, and we couldn’t be more thrilled for everyone involved.

All startup journeys are different, even the wildly successful ones. In the past couple of weeks we’ve had the opportunity to celebrate an 11-year journey from first check to IPO with Remitly and now this much shorter journey from first check to blockbuster acquisition. To us, both paths feel just as complete. When we partner with founders, we’re backing them and their vision, and the best part of the job as an early stage investor is the moment when that vision grows into something that’s bigger than we or they ever imagined. (That and making our LPs happy, which goes hand-in-hand with these kinds of successes).

When Chris and I first met Vetri, we knew that he was going to build something special. We just didn’t know how quickly he’d do it. Today, serves over 1,000 customers and employs over 250 people across multiple continents. And they’re just getting started. 

Vetri is a man on fire with the passion to impact and elevate others, delivered through a rare balance of charisma and humility that we look for in every new founder that we meet. Thank you Vetri and for selecting us to lead your seed round and inviting us to go on this journey with you. It’s been a privilege, and you’ve made us better investors for the experience.

Why did you start Ganaz?

My whole career has been driven by the belief that you can build a virtuous cycle between workers, employers and downstream retailers and consumers. I was at Fair Trade USA for many years building that belief into a thriving market for Fair Trade produce. And while I was there, I watched farmworkers adopt cell phones and then smart phones. The industry was trying to solve huge problems including a painful labor shortage, food safety, and compliance with complicated labor laws. White collar industries had their pick of incredible people platforms like Gusto. But in agriculture, there wasn’t a single software platform that had figured out how to serve this industry well–to help it run more efficiently and take better care of its workers. I figured we could build that and build it better than anyone else because we intimately understood each part of the supply chain and really cared about each of them.

Why did you decide to work with Founders’ Co-op?

We had the great fortune of getting into Techstars in 2018, and Chris Devore was the Managing Director at the time. I had the opportunity to get to know Chris and Aviel during Techstars and came to trust them and really appreciate how they challenged us. It’s rare you have the opportunity to spend four intense months getting to know an investor, so when he offered to lead the round, it was a no-brainer. Chris is one of the wisest and most emotionally intelligent investors I’ve ever met. I’ve been incredibly lucky to lean on him and learn from him for the past few years.

Words of Wisdom

Be clear and insanely dedicated to the impact you want to have on the world. Be flexible about how to achieve that impact. Originally, our idea was to be a labor marketplace like Glassdoor for farmworkers. It didn’t work, but I knew there were other ways to have a huge impact on this population, so we pivoted. But in retrospect, we could have pivoted more quickly and more decisively.

Why are you building Ganaz in the Pacific Northwest?

The PNW is home to me, so, selfishly, that’s where I wanted Ganaz to be headquartered–not to mention the great technical talent, huge agriculture industry, and a more accessible and welcoming tech ecosystem. I am an outsider to the tech industry, and yet I found a community in Seattle that welcomed me, encouraged me, and helped me network my way into the connections we needed to get Ganaz off the ground.

I’m thrilled to announce that we’ve just led a seed investment (our largest first-check investment to date) in Ally, the intelligent operating system for business execution. Ally helps businesses tightly connect strategy to execution, and leverages ML to orchestrate alignment and transparency throughout an organization. Step one of their mission is to bring a highly effective Objectives and Key Results (OKR) process into organizations of all sizes, through a workflow that engages team members within the tools they’re already using, like Slack.

So far so good.

Today they’re already working with companies like Slack, Remitly, Plaid, Teleperformance and UrbanClap, and are adding new customers at a rate I haven’t seen since the early days of my former startup, Simply Measured.

But like it says in our name, we invest in founders first and businesses second. We didn’t chose to partner with Ally founder Vetri Vellore just because of the amazing business he’s built, but also because of the passion and thoughtfulness with which he is building it. In fact, we almost passed on our first introduction to Vetri because of our existing bias against OKRs.

Over the past decade I’ve been part of over a dozen OKR deployments, including one as the lead product executive tasked with rolling it out to a large organization. I’ve now used everything from spreadsheets to disastrously complex HR-focused solutions that tie business performance to employee performance, and I just couldn’t wrap my head around how an organization that wasn’t Google (famous for successfully using OKRs), could really put them to good use. That was until I met Vetri, who not only utilized OKRs extremely successfully at his previous startup, but also showed me a product that I actually wanted to use. One that I wanted all of my portfolio companies to use as well. One that would make them better and give them an edge over their competitors.

Welcome Vetri, to the Founders’ Co-op family! We’re honored to be part of your mission to fundamentally change the way high-performing companies operate.

PS: If you or one of your friends is a marketing leader and a sales development rep looking for a once-in-a-career opportunity, shoot Vetri an email @ vetri [at]

When Rudy Giuliani declared “Truth isn’t truth” in defense of Donald Trump, I cringed. Not just for the obvious reasons, but because as I absorbed the absurdity of his statement, it hit uncomfortably close to home.

How do startup leaders think about truth, especially in the age of Theranos? What’s a true statement in or about a startup? Things move so fast (especially in the really early and high growth phases) that something that is true today often isn’t true tomorrow.

With the pace of change (both macro and micro), communicating progress can feel like an exercise in reporting on the status of Schrödinger’s cat. What complicates things is that as founders and leaders it’s surprisingly hard to tell employees or investors “I don’t know”. It’s even worse to not communicate at all. You’re pressured to have an answer, and if you don’t, it looks like you don’t understand your business. But when you’re wrong, you lose credibility.

That’s where we as investors can do better to help founders be as truthful and transparent as possible about their business, because the more we know, the more we can help. But investors don’t always do the best job of making founders comfortable with vulnerability and instead can reinforce the overconfident salesy mode of operation that’s often a requirement for leading a growing company through its inevitable struggles. This is one of the many reasons why it’s so important that founders select investors that they trust and connect with vs. the one that offered the best terms. But even then, talking about all the inevitably broken or at best partially broken and uncertain things in your business can be hard.

To make these kinds of conversations easier, I’ve found it useful to categorize judgements and statements about startups into 4 categories.

True as in “We closed a seed round”
Something that is objectively true.

Temporarily true as in “We’re going to hit next month’s revenue goal”
An outlandish goal that helps motivate and drive alignment. An optimistic view into something you’re trying to achieve that you think (hope) you will.

Temporarily false as in “We are the market leader”
Something aspirational and often visionary. Said more cynically… unmalicious and purpose-built self-deception.

False as in “We pay a competitive salary”
Something objectively false.

The reality is, if you’re a founder, you’ve probably said all of these things at one point or another to your customers, employees, and investors. Depending on when, you’d also probably categorize them differently. If you’re lucky, you’ve been successful enough to transition all 4 of those statements to true.

The temporarily true things are your rose-colored glasses. They are your rallying point and the overly optimistic claims that motivate people into making your goals a reality. They help keep people excited through the hard times when progress looks like one step forward and two steps backward.

The temporarily false things are the little lies that you’ve decided to tell as part of achieving a goal where in the ends justify the means. You have every intention of making these things true, and really do believe that by the time it actually matters it will be. In enterprise SaaS, you’d never land your first customer if they knew how bad or incomplete your product was. Your first employee would also never join if they knew how close you were to not being able to pay them.

Or would they? That’s where things get complicated.

Reality distortion fields, while effective, are a powerful but blunt instrument. In the hands of an outwardly confident but intellectually honest and inwardly reflective founder they can be a fantastic tool and let you pull the future backwards into the present. Used too often though, or by someone lacking self-awareness or integrity, and they can be the most destructive thing possible.

But with great power comes great responsibility, the difference between you and Theranos is not a giant chasm, it’s the slippery slope of transitioning your aspirations into your realities and what you’re willing to risk to achieve that. When something is only temporarily true, you need to recognize that. When it’s temporarily false, you need to recognize that too.

And while it can seem like 80% of your job as founder (and especially founder-CEO) is being a confident visionary, that’s where I think founders start to run into trouble. Startup founders are always fundraising, always recruiting, and always telling their story. Once you repeat it so many times, add charisma to it, pour your life into it, and maybe even say it on stage in front of hundreds or millions through the press, it becomes challenging to maintain your intellectual honesty. It’s like drinking a bottle of wine every night and trying not to become an alcoholic.

This self-deception is the slippery slope I’m referring to. It’s more dangerous than lying because it can become impossible to bifurcate those parts of your business that are truly enhanced by your ability to influence reality vs. those that can be destroyed by it. You can find yourself suspending reality when you actually need to be embracing it.

It can make great teams underperform and in extreme situations can make good people do bad things.

Worst of all, it’s nearly impossible to self-evaluate self-deception, and that’s where diverse leadership teams and great founder/investor relationships become paramount. Because while creating a reality distortion field is a powerful, and probably even required tool for building a successful startup, being grounded and intellectually honest is a more consistent factor in success. But you can’t ground yourself, you have to surround yourself with great people who bring out the best in you and make you your best self, even if it’s uncomfortable (it’s usually very uncomfortable).

Nothing in startups is simple and the truth is almost always complicated. In the sense of Schrödinger’s cat, your startup can both be crushing it and about to be crushed at the same time. It’s okay to recognize that, and with the right tools and hard work, the cat will be alive when you open the box.

Thanks to John Scrofano, whose feedback on the first version of this post was so impactful and widely incorporated that he’s now a co-author.

As seed phase investors (H/T to Hunter Walk for the term), we invest in companies that spend the majority of their time learning and iterating, and yet when it comes to fundraising conversations too many founders think that what I want to talk about the most is their solution and why it’s going to make a billion dollars.

The truth is, while I certainly care about your product in the context of how it evolves towards a big vision, I care a lot less than you think about what you’ve built thus far and are planning to build over the next year. Companies that go on to IPO as well as those that go nowhere both pretty much uniformly have bad products (if one at all) at the stage we invest. Like really, really bad barely usable products that are also probably at least 50% wrong for the customer. In some cases, and even with incredibly successful companies like Outreach and our Techstars Seattle portfolio companies Skilljar, Zipline, and Leanplum, it can be closer to 100% wrong.

But it’s not the founders’ fault for pitching us this way, it’s on us as early stage investors to help them better frame the conversation. After all, since you likely don’t yet have revenue, what else can we talk about besides your product and how exciting and potentially lucrative its customer is, right? But at the seed stage specifically, I’m not investing in what you’ve built thus far, nor am I investing in what you think you should build next. And it’s a waste of time to try and convince me why your envisioned solution is so exciting, because again… what you build is likely going to suck and at best be just good enough to not be bad.

What I am interested in investing in, besides the founding team, is the sum of what you’ve learned thus far about your business opportunity and what you’re planning on learning over the next 18 months.

Fundamentally, when I invest, I’m investing in a team and a process, not a product. I want to know what your process looks like, how well it works, what you’ve learned evolving it, and how you’re going to use it to build a big business. That’s what excites me.

The customer problem your product is solving isn’t interesting yet and your product doesn’t yet have any intrinsic value (see bad). A good product in an early stage startup is actually just an agile research tool. Something that can be used to test hypotheses, get closer to the customer, and search for a business model. The better you are at this, the more excited I am.

The first product we built at Simply Measured was a really awful social analytics tool designed for one purpose, to validate whether marketers were willing to pay for easier to access social media data. Our next iteration of the product tested their willingness to pay for reports. Our third iteration tested marketers’ appetite to pay for owned-media reporting.

Armed with those learnings, we went out to pitch our investors and asked for $750k to see if enterprises and larger agencies would pay large amounts of money for our solution. We told investors what we had set out to learn, what we did, and what we were planning on learning next. We found folks as excited about the answers to those questions as we were, and because of that, they invested in our company.

If you want investors like Founders’ Co-op to love you and love your company, pitch your team, pitch your process, and pitch me some really interesting questions that you’re the best-suited person in the world to answer. Don’t pitch me your product.

As an investor, I care a lot – and I mean A LOT – about founders’ motivations for starting a company.

Over the past couple of years, nearly every relevant Bay Area technology company has opened up an engineering office in Seattle and our hometown heroes Amazon and Microsoft are also attracting an unprecedented amount of technology talent to the region, many of whom are itching to start their own companies. With all those new potential founders in town, I’m getting asked a couple of times a week, “How much money should I save up before leaving my day job?”, and “What’s enough market validation to justify me going full time?”

These are the wrong questions.

Let me start with my story…

When Damon Cortesi and I initially founded Simply Measured, we came at it from different backgrounds, but made the decision for the same reason.

For Damon, he felt an urge to move from being a breaker of software to a builder. And more than anything he wanted to cultivate a company culture where people would be proud to tell others about their job. He also found himself spending his evenings working on things entirely outside his field of security and wanted to turn his passion projects into his career. He was willing to walk away from a juicy six-figure salary to do that, and while he didn’t have much saved up, he also wasn’t all that leveraged, so he figured we had a year to make it work.

I was two years out of college and drawn to the unknown. I just wanted to build something great and enjoy myself doing it. While I had what most entrepreneurially-minded software engineers would consider a dream “first job”, writing code AND getting to be customer-facing at a rapidly growing venture-backed startup, I was entirely uninterested in our customer (the healthcare marketer). My job felt too much like well… a job. Unlike Damon, I was living comfortably on $50k/year and had a chunk of cash set aside which gave me a safety net. But like Damon, I found myself pouring all my free time and energy into my passion projects in the evenings, and after joining forces with him on one of them, could no longer focus at my day job.

Our side projects had no customers, no market validation, and were simply products that we couldn’t stop ourselves from building. In our case, we loved social data and how social networks were changing the ways that businesses interacted with consumers. Thinking about this shift, and the opportunity it presented, consumed us.

And while our personal financial situations should have been relevant to our decisions, we didn’t even consider them at the time because our drive to found was so strong. We wanted to invest our time into something we were passionate about and didn’t think once about how much money we’d make, how that compared to what we were walking away from, nor how we were going to support ourselves more than a year out.

This is the best way to start a company.

There will always be many more rational reasons NOT to found a company than the other way around, and the best founding decisions are often irrational and motivated solely by a burning passion to work on one specific thing and pour your life into it.

Founding a company is a huge risk, and the reality is that we both in our own ways could afford to be irrational and take that plunge. As fathers now in our mid-30s, making that decision to start the company like we did back then would have come at a much higher cost.

Everyone’s situation is unique, there isn’t a certain amount of savings required to start a company nor some magical level of level of traction that tells you that you won’t be wasting your time. But there is a level of drive and passion that gets founders to not care about their answers to those questions. Until you find yours, you aren’t ready to quit your day job.

My question back to you is, “What are you so passionate about doing that the answer to those other questions doesn’t matter?”

I’m thrilled to publicly announce the really poorly kept secret, that after almost 4 years of working alongside Chris DeVore and the rest of the Founders’ Co-op team, I’ve stepped into the partnership with both feet as a General Partner. Going forward the investment team will be myself and Chris, with Rudy Gadre and Andy Sack remaining involved as Venture Partners.

In transitioning from entrepreneur to investor, the lifetime of hard earned lessons from my journey as a founder of Simply Measured won’t be going to waste, and I’ll be working just as hard as ever leveraging those experiences in this new challenge, both the good and the bad. Those eight years of operating, growing from two people in a coffee shop to 150 employees, ruthlessly forged my understanding of my strengths and my weaknesses; my limits and my opportunities for growth. With that, where I can create the most value and grow the most is not as a founder, but as an investor working with founders by supporting and challenging them.

And the timing couldn’t be better.

From the investment world, to the tech world, to well… the entire world itself, it’s abundantly clear that we’re in a time of transition. We’re long past business as usual, but in many ways we’re still pretending, which is all too easy as public markets continue rise seemingly against gravity. Except for Facebook and Twitter this past week…

As early stage investors, you’d imagine that elevated uncertainty makes our jobs harder than ever. So my timing isn’t great, it’s terrible! Right? After all, most companies we work with are only 15% of the way on their journey in terms of time and 1% in terms of execution when we invest. 99% of what makes it a good or a bad investment simply hasn’t happened yet. It follows then, that the less we know about the future and the less trusted the patterns we have to match against, the riskier the proposition.

But it’s in these types of environments that Founders’ Co-op’s strategy thrives, because our success isn’t contingent on us predicting the future. You can look to history to understand what happened in a market and sometimes even why, you can even use it to gauge volatility and the likelihood of disruption, but you’re much smarter than we are if you can use it to decipher exactly how things will evolve in the future and invest around that, especially in today’s climate.

Our conviction at Founders’ Co-op is grounded in our belief in what won’t change. We aren’t a thematically driven fund, we invest in self-aware and intellectually honest, execution focused founders who don’t need the world to change in a specific way for them to be successful. That magical combination is rare, but part of what makes the Pacific Northwest so unique is how much less uncommon it is here than anywhere else, and we’re not this way by accident.

The Pacific Northwest is home to Amazon and Jeff Bezos, who summed up this ethos perfectly when he said, “I very frequently get the question: ‘What’s going to change in the next 10 years?’ And that is a very interesting question; it’s a very common one. I almost never get the question: ‘What’s not going to change in the next 10 years?’ And I submit to you that that second question is actually the more important of the two — because you can build a business strategy around the things that are stable in time.” Most of our greatest successes come through this mentality. Sales people will continue to sell, money will continue to be transferred, and development teams will continue to build software… just in new and better ways.

Cryptocurrencies, XR, machine learning, voice assistants, and autonomy will all be significant drivers of change over the next decade, and while individually they’ve all already begun to reshape our everyday lives, their combined potential impact and the specific outsized opportunities that will arise as a result are unclear. At Founders’ Co-op, we don’t chase these technology-driven opportunities in themselves, and instead back founders that leverage these emerging technologies to solve the tangible human problems of both today and tomorrow, the things that won’t change. We love founders that follow the customer and not the technology.

With that, unlike some other venture firms, we don’t expect the majority of our companies to fail. Good execution and meaningful value creation will in almost all cases create real value and outcomes that both investors and founders can celebrate. In this model, we also don’t model for the single outsized success that defines traditional venture, and because of that, we also may never return 10x our fund. But what we do expect, and enjoy, is consistently healthy returns and strong alignment with our founders. I am one of those founders, having raised my first $150k for Simply Measured from Founders’ Co-op’s first fund. Our founders are why we get up in the morning and why I’m taking on this new role.

Our model is not the only model for venture, but we evaluate our own strategy the same way we do our company’s. How will ICOs and other fundraising mechanisms change the seed stage investment world? With more liquidity, how far will the once clear line between investor and trader blur? We don’t know. But we do know that the best founders will continue to build the best companies, many of them in the Pacific Northwest, and we know how to help them.

If you are one of them, let’s talk.