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Venture Hacks

• Postling gets funded with AngelList 1 April, 2010, 1:21 pm
  We recently wrote about the first startup that got funded through AngelList: Matt Mullenweg invested in a Y Combinator startup we called Startup #0. Today, we’re announcing that Postling is the second startup to raise money from AngelList. The AngelList investors are: Dave McClure (Investor in Mint) David Cohen (Investor in Twilio) Thomas Korte (Investor in Heroku) Chris Yeh (Investor in PBworks) Paige Craig (Investor in Plancast) David S. Rose (Investor in Ambient Devices) Thomas McInerney (Investor in Mochi Media) Gary Vaynerchuk and Kal Vepuri, who aren’t on AngelList yet, also invested. That’s an awesome list of angels. How did Postling do it? First, Postling had traction — in fact, they were already charging for their product. Second, they listened to customer and investor feedback and pivoted into a larger market during their fund raising process. More details about the pivot in this post on GigaOM — Postling’s website doesn’t reflect the pivot yet. Third, the company was started by two of the founders of Etsy. But they didn’t need that pedigree to raise the round — they could have done it with just their traction and pivot. Update: Read Postling’s story, in their own words: The inside story on how I raised $200k in 6 days. AngelList is growing quickly There are now 75 angels on AngelList and we’re adding 1-2 new angels a day like Mike Maples, Ram Shriram, and Aydin Senkut. You can track the day-to-day minutiae of these angel’s lives with the AngelList Twitter list: // Startups: Get intros to AngelList here. Angels: Join AngelList here. Everyone: Get AngelList updates with Twitter or RSS. Thank you all for being part of this.
• “Being open early worked well for us” 2 April, 2010, 8:01 am
  In Where’s the demo?, I asked, “Unless you’re famous or a big company, why do a closed beta?” There are lots of good reasons why in the comments. But my favorite comment is from Rob May, founder of Backupify and AngelList power broker: “In the early days of Backupify (when it was still called Lifestreambackup), not only was I worried that someone would steal the idea and execute it better, but I was also embarrassed by the quality of the product when I demo’ed it.  But ultimately, some early users loved it and that kept us going.  By releasing an early buggy minimum viable product, we got a pretty big lead on everyone else.  Now we have a bunch of competitors, but with more than 60K users and 30 terabytes of data backed up, we are pretty far ahead in terms of traction. Being open early worked well for us.” By the way, Backupify recently raised money from General Catalyst and First Round Capital.
• [Startup Digest]: “The best startup events in 27 cities” 3 March, 2010, 9:01 am
  Every day (literally), I get an email from someone asking me to introduce them to investors, advisors, and co-founders. We’re building StartupList and AngelList to handle the intros to investors. For intros to advisors and co-founders, I always tell people to sign up for [Startup Digest] — a weekly curated list of the best events in 27 cities — and start going to lots of events. Good things happen to you at events I don’t go to a lot of events anymore because I “wouldn’t be here working.” But I went to a lot of events when I moved to Silicon Valley 5 years ago. And great things happened to me at these events. I met Mike Arrington and ended up crashing at his place for a few months when I had no place to stay and very little money. I was re-introduced to David Cowan and ended up working with him as an EIR at Bessemer. Going to an event can create its own luck. From the archive of the blogger formerly known as pmarca (a.k.a. Marc Andreessen): “In Chance II, something else has been added — motion. “Years ago, when I was rushing around in the laboratory [conducting medical research], someone admonished me by asking, “Why all the busyness? One must distinguish between motion and progress”. “Yes, at some point this distinction must be made. But it cannot always be made first. And it is not always made consciously. True, waste motion should be avoided. But, if the researcher did not move until he was certain of progress he would accomplish very little… “A certain [basic] level of action “stirs up the pot”, brings in random ideas that will collide and stick together in fresh combinations, lets chance operate. Events are the place to meet people who won’t meet with you People who aren’t available over email or one-on-one go to events to make themselves available. Mark Suster writes, “One area where I have made in-roads is in the “I’d like to buy you a coffee for 15 minutes and get some career advice” emails from people I don’t know. I really do like to help people so in the early days I took some of these. I simply can’t fit in the time any more. So I often advise these people to find me at a conference and I promise to spend time with them there. I’ve already allocated that time as “general networking time.” I’ve developed a system for the polite “no” in this context.” Sure, we would all like to get a 30-minute phone call with Mark, but I think you form a deeper psychological bond if you can talk to him for 10 minutes in person. So if you’re looking for intros to advisors and co-founders, sign up for [Startup Digest], start going to events, and create some luck.
• “AngelList is the real deal” 7 April, 2010, 8:01 am
  AngelList reviews from entrepreneurs in the trenches: Tony Wright, Founder of RescueTime (and AngelList power broker) says: “AngelList is the real deal. I’ve heard quite a few people having some success there. Even as a YC company, there is a startling hole after Demo Day… It can take months to close a round (it took us 5ish), even loaded down with Demo Day biz cards and meeting invites. If I were doing YC again today, I’d try to get on AngelList right after Demo Day…” Paul Stamatiou, Founder of Skribit says: “Nothing but great things to say about AngelList. I applied with my startup and while we weren’t selected for that week, Nivi sent me a nice personalized email and has been super friendly and always open to chat about startups.” Dave Lifson, Founder of Postling says: “So we pivoted (explained in the GigaOm post, but I’ll say more soon), and sent the new direction to AngelList. And this is where the craziness started. “My first phone call was with Tom McInerney, 3 hours before I was flying out to SXSW. After about a 30 minute phone call, Tom was in. He then introduced me to his friend Paige Craig, who would also be at SXSW. I met Paige in Austin, and after meeting, he told me he was in. The next day, at a Venturehacks meetup at the Four Seasons hotel, he pulled over Dave McClure. We went out to the balcony (he wanted a cigarette) and I pitched him. He was in. The following day, I spoke with Thomas Korte, who moved up our scheduled phone call a couple days once he heard Dave was investing, and he was in. I also got an email introduction via my friend Russ (founder of SeatGeek) about his investor Kal Vepuri, who was also at SXSW. Kal and I spoke on the balcony of the Austin Convention Center, and I was blown away by his intelligence and humility. So Kal was in. Finally, my friend Michael Galpert of Aviary connected me with Gary Vaynerchuk, who is a perfect investor for us given what he is passionate about (social media for businesses). David Cohen finished off our round not too long after that. “So that’s it. Through a combination of a great team (Chris & Haim founded Etsy), customer development, responding to feedback, AngelList, networking, and being able to articulate a compelling vision backed by domain expertise, I was able to raise $200k in the 6 days of SXSW!” Startups: Apply to AngelList. Angels: Join AngelList. Everyone: Get AngelList updates with Twitter or RSS.
• How much traction do I need? 14 April, 2010, 8:03 am
  The top 3 things we look for in the startups that apply to AngelList are initial traction, social proof, and product. The team is also obviously important, but good teams tend to have good traction, social proof, and products. Since I was a child, people have asked me, “How much traction do investors want to see?” The right answer is “you tell me.” Find the competitors that investors wish they had invested in and compare yourself to them. And skip the #’s — show graphs. The Google Analytics screenshot above compares the traffic bump that [Startup Digest] got from TechCrunch vs. Venture Hacks. Even better, show cumulative graphs that imply your second derivative is positive: Unlike my graphs, make sure you include axis labels, a legend, and a title. I’ve heard that Google’s entire presentation when they were raising money was a metrics graph. You should put together a more complete presentation than that — but, if you only have time to pull together one slide, make it traction.
• It takes more than one intro to get a meeting 8 March, 2010, 9:16 am
  Don’t be afraid to get multiple intros to a single investor. Fred Wilson: “One of my favorite VC quotes comes from Bill Kaiser of Greylock. He once said, “when I hear about a company once, I often ignore it, when I hear about it twice, I pay attention, when I hear about it for the third time, I take a meeting”. “It happened to me this week. I met with Reshma who runs seedcamp, the european version of Y Combinator, on Monday and she told me about Zemanta which came out of last year’s seedcamp. Then I saw this blog post about Zemanta on Techmeme the next day. And then on Thursday, Alex Iskold, founder of our portfolio company Adaptive Blue, introduced us to Andraz, one of the founders of Zemanta. “Three hits in one week is absolutely a “pay attention” notice. So this morning I am trying Zemanta out. The image and most of the links in this post were automatically provided by Zemanta.” Put yourself in Fred’s shoes. His inbox is overflowing with intros to companies that are as good as yours. He has to ignore most of the intros and focus on a few of them. One of Fred’s best filters is the quality and quantity of the people referring your company. And, by the way, Fred went on to invest in Zemanta. How to get multiple intros This is what we tell entrepreneurs who use AngelList and StartupList: we recommend doing all of these at the same time, Email investors directly if they allow it. But first read their profile to see if you’re a good fit. Don’t contact them if you don’t fit their interests — you’re not the exception that proves the rule. Use one of the referrers they suggest. But don’t spam referrers — you should either know the referrer or the referrer should be open to cold calls. Use Facebook/LinkedIn and ask mutual friends for an intro. You should either know the mutual friend well or the mutual friend should be open to cold calls. Send your elevator pitch to StartupList and, if you’ve got a good pitch, we’ll send it to the investors on AngelList — or, if you prefer, specific investors you suggest. 4 weeks in, we’ve already done intros between 15 startups and 25 investors — and gotten 1 startup funded. Even better, with StartupList, the investors come to you. The idea here isn’t that you should keep bugging investors — the idea is that it often takes three tries to get a meeting.
• I’m speaking at SXSW + Holding a SXSW MEETUP 12 March, 2010, 3:26 pm
  Naval here. For those of you going to SXSW, I’ll be on the Seed Combinators Panel on Monday March 15 3:30pm. I’m joining Paul Graham, David Cohen, Marc Nathan, and Joshua Baer to talk about YStars, TechCombinators, SeedBoxes, and the like. Here’s the Plancast if you want me to “count you in.” I’m also throwing a SXSW Venture Hacks Meetup on Sunday March 14 5-7pm in the Four Seasons Lobby Lounge at 98 San Jacinto Blvd. If you’re coming to the meetup, please RSVP on Facebook xor Plancast so we can get a headcount. If you’re a Venture Hacker, please come talk to me about your startup and venture hacking at these two events. I’m looking forward to pressing the flesh and kissing some babies.
• Which angels have taken meetings from AngelList? 25 March, 2010, 8:02 am
  You already know about AngelList, our curated list of top tier angel investors. You also know that you can get in touch with these angels by sending us your pitch and, if it’s investment grade, we’ll pass it on to the angels. We’ve already announced the first startup that was funded this way and more announcements are on the way. In the meantime, I thought you might like to know which angels have taken meetings (or are setting up meetings) with the startups we’ve sent to AngelList. It’s a pretty awesome list of angels. All of these angels have given us permission to use their name. In no particular order, here we go… Dharmesh Shah (Investor in Backupify) Thomas McInerney (Investor in Mochi Media) Aaron Patzer (Investor in Milo) Shervin Pishevar (Investor in Gowalla) Jeff Clavier (Investor in Mint) Matt Mullenweg (Angel in DailyBurn) George Zachary (Charles River) Chris Yeh (Angel in EtherPad) Jeff Fagnan (Atlas) Brian Norgard (Angel in ad.ly) Mike Hirshland (Polaris) Alex Finkelstein (Spark Capital) David Cohen (Techstars) Bill Lee (Angel in Posterous) Michael Dearing (Angel in Aardvark) Rob Go (Spark Capital) Richard Chen (Angel in Aardvark) Joe Greenstein (Angel in Eventbrite) Ann Miura-Ko (Investor in Modcloth) Andrew Parker (Union Square Ventures) Jon Callaghan (Investor in Meebo) Ho Nam (Investor in JS-Kit) Rob Lord (Investor in Grockit) Pejman Nozad (Investor in Dropbox) Fadi Bishara (Investor in Bebo) Thomas Korte (Investor in Heroku) Salil Deshpande (Investor in Engine Yard) Mark Suster (Investor in awe.sm) Peter Chane (Investor in Aardvark) Gabriel Weinberg (Investor in Wakemate) David Cowan (Top 10 on Forbes Midas List) Bijan Sabet (Investor in Twitter) Bob Shapiro and Drew Turitz (Sandbox Industries) Chris Sheehan (Investor in Carbonite) Sim Simeonov (Investor in Veracode) Satish Dharmaraj (Investor in Posterous) Keith Rabois (Investor in YouTube) Manu Kumar (Investor in CrowdFlower) Bipul Sinha (Investor in Sweepery) Phineas Barnes (First Round Capital) Saar Gur (Investor in Admob) Ariel Poler (Investor in StumbleUpon) Andrea Zurek (Investor in Tapulous) You (Join AngelList →) And You (Join AngelList →) That’s 40+ angels and counting who have taken meetings from AngelList (ping me if I missed you or I shouldn’t have included you). I want to thank all the angels who are making AngelList happen and the startups who are applying for intros. Startups, apply for an introduction to AngelList here. Angels, join AngelList here.
• Where to find the best startup advice 28 April, 2010, 10:29 am
  “This is probably the first methodology that’s been crowdsourced. Big idea. Unlike previous methodologies where there was an author, textbook and take-it-or-leave-it, this is an iterative process and I think we’re all collectively getting smarter at a very scary rate.” – Steve Blank (at 6:53) Where can you find the best startup advice? Short answer: We collect it in this daily email, daily RSS, or real-time Twitter. Here’s a pic of the email version: Long answer When we started Venture Hacks in 2007 (April 1st to be exact), there wasn’t a lot of great startup advice on the Web. Of course, we weren’t the only game in town and guys like Paul Graham and Fred Wilson were rocking well before us (I’m sure I’m ignoring many other examples). Since then, the quantity of good and bad startup advice on the Web has exploded. I listed 20 startup blogs I read religiously in The Startup MBA. Many good startup blogs have popped up since — Chris Dixon’s and Mark Suster’s blogs come to mind (I’m sure I’m ignoring many other examples again). Who has time for this? We do. We read every post on dozens of startup blogs and Hacker News. Then we link to the good stuff with Twitter. And if you don’t want to miss a link in your Twitter stream, sign up for the daily email or daily RSS too. Help us find the best advice Please tweet good startup advice to @venturehacks — that’s much better than email. We’ll try to credit you if we link to your suggestion. Steve Blank is right — we’re all collectively getting smarter at a very scary rate.
• Facebook acquires AngelList startup 8 April, 2010, 8:03 am
  Today, we’re announcing that Divvyshot is the third company to raise money with AngelList. And the first AngelList-funded startup to be acquired — by Facebook no less. The AngelList investor is: Richard Chen (Investor in Aardvark) And Divvyshot was referred to us by an AngelList power broker: Jamie Quint (Founder of Simple Condo) Divvyshot also raised money from Y Combinator (in a previous round), Jim Young and Gabor Cselle. That’s a great list of investors. Soon after raising this round, Divvyshot was acquired by Facebook. Update: Jolie O’Dell picks up this story for Mashable. New angels on AngelList Some of the awesome new angels on AngelList: Mitch Kapor (Investor in Posterous) Ram Shriram (Investor in Google) Mike Maples (Investor in Twitter) You can track the day-to-day minutiae of these angel’s lives with the AngelList Twitter list. 2 years ago, you would have had a tough time convincing me that the best angel investors in the world would be publishing hourly updates about their lives via txt message. But here you go: // Startups: Get intros to AngelList here. Angels: Join AngelList here. Everyone: Get AngelList updates with Twitter or RSS.