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Charlie O' Donnell

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Thursday, February 21, 2019 - 12:01pm

While most of the money that goes into VC funds comes from institutions that are highly experienced in the asset class, some family offices and high net worth individuals also invest in VC. They’re trying to get exposure and diversification at the same time, while potentially seeing co-investment deal flow.

A lot of VC fund pitches—and I know this because I used to vet VCs for a living as an institutional limited partner at a pension fund—sound the same. They all have great networks, above market performance and some special sauce that sounds nice but you’re not 100% clear it makes sense as a way to boost returns or get access to deals.

Here are five questions I would ask any new or emerging VC fund:

  1. In the five years before you had this fund (in case they have a short track record) what deals could you have legitimately gotten into that fit your strategy that would have been winners?

  2. Could you have led any of these deals?

  3. If every single fund at your size/stage/geography/strategy said yes to a deal, where are you in the order of preference for founders to accept a check from? (i.e. If you’re a Series A fund in NYC, and you, USV, Firstmark, RRE, etc all submit term sheets, who gets in and in what order?)

  4. Explain the math that gets you to a 2-3x net (after fees) return—how many deals, how much in each deal, at what valuation, what exit expectations, follow on or not, etc. If they haven’t done this math, they shouldn’t be managing your money.

  5. What risks have you taken that others haven’t—and why did you think they were worth taking?

If you want to learn more about how VC funds get evaluated and you’re either an accredited investor, a non-partner at a VC fund, or work on behalf of a family office, check out this event tomorrow. We are especially focused on bringing diverse attendees into the room. If you’re not sure if you qualify, e-mail me. No current non-accredited founders, please.

Wednesday, February 20, 2019 - 2:57pm

The headlines in the tech and startup world have not been good over the last couple of years. As it turns out, the “move fast in break things” culture was itself pretty broken—full of discrimination and harassment. On top of that, the rise of tech is exacerbating wealth inequality, creating some serious data privacy issues, and allowing hate and misinformation to grow rampant on its platforms.

For all its promise of moving humanity up and to the right, the tech industry boom has had some nasty side effects, and as we saw in Amazon’s HQ2 fight in NYC, a lot of people aren’t taking it anymore.

It’s not surprising. When wealthy tech leaders seem, at best, disconnected from the rest of the world’s issues and at worst totally unsympathetic and wrapped up in their privileged little bubbles—it’s easy to be against them.

Perhaps if tech suddenly made housing, healthcare, transportation, combating opioids AND fixing climate change super cheap, AND enabled underemployed and displaced workers to survive on a living wage, AND provided childcare and education, I’m sure @aoc would give you a refund. https://t.co/40lMhxtOLu

— Charlie O'Donnell (@ceonyc) February 18, 2019

I hope we can take a different path in New York City. As the local ecosystem matures and gets more and more politically active, I hope our activities coalesce around the following single issue:

How can the technology community make life in NYC better for everyone?

That’s it.

I don’t ever want to hear any issue ever brought up by anyone in NYC tech unless it has that as its lens. No more “How can my company get faster internet?” It should be “How can everyone get faster internet?”

Imagine if it wasn’t “Should we have Airbnb or not?” but instead Airbnb was seen as an active proponent of expanded affordable housing construction. Imagine if WeWork refused to take more space with a commercial landlord unless that landlord was seen as friendly to small retail businesses.

The New York City tech community has the opportunity to be seen as a very public and influential champion of fairness and equality within our city—and it’s in the community’s best interest as well. If NYC was a place of access to affordable healthcare, childcare, working transportation and fair wages, as well as the kind of place where you could grow up and not get displaced when the economy performs well, every single company would want to be here.

So, while we’re debating the best way to get kids coding in school—which I do think is important—let’s make sure no one ever gets arrested for marijuana possession in New York ever again and thrown into the incarceration cycle. When we’re writing up the scooter regulations, let’s make sure renters have adequate protections against increases and harassment by landlords looking to clear buildings. As we’re busy building a world class educational institution using public land, let’s make sure everyone in the city has a home to call their own.

New York City residents will get on our side when we get on theirs first.

Monday, February 18, 2019 - 12:54pm

Brooklyn Bridge Ventures, the pre-seed and seed stage VC fund I run in NYC, has invested in 64 companies in the last six and a half years.

Twenty-five of them have at least one female co-founder.

Fifteen had co-founders over 40.

Five have LGBTQ+ founders.

Three teams have African-American founders.

Three of the founding teams are married couples.

All were backed based on the sole criteria that they had the potential to make my limited partners a lot of money. The diversity is the direct result of our mission—to build the most accessible venture capital fund in NY. I don’t require warm intros. I will back a wide variety of types of companies—everything from The Wing to Imagen.

Surrounding yourself with diverse teams means being exposed to a lot of different perspectives and creates learning opportunities not possible when everyone you deal with professionally looks and acts like you do.

Here are just a few things I’ve been exposed to that I think if you’re not surrounding yourself with diversity in your professional world, that you’re missing out on:

  1. There is a difference between intention and effect—and if I care about others, effect is what should count. Just because you didn’t intend for something to get taken a certain way doesn’t mean the conversation stops there. People are different—and your conversational and language norms, particularly when you are in a privileged group, aren’t the “norm”. Anyone who doesn’t want to hear how their words and actions were received lacks empathy.

  2. My individual interactions are part of a series of lived experiences for others. I was reminded of this from one of my founders of non-white descent. He mentioned what it felt like to have someone ask you where you were from. The person asking experiences it once, but when it happens everyday across multiple people, it’s a pattern making the receiver feel like an outsider and an other. This happens in lots of other situations. It brought to mind industry interactions that lacked clarity in their intent. I know I had previously given very little thought to the emotional drain it causes when conversations turn social all the time for women in the industry—when one-off asks or comments form a constant stream of experiences to be on guard against. When you back women and you’re trying to encourage the expansion of their network and the building of their personal brand, you cannot help but review all of your own actions after listening to the compounding emotional effects of their professional experiences.

  3. Different groups communicate differently—and it’s important to find objective common ground around language, goals, and risks. If everyone gets measured based on one set of shared norms around pitching, professional reviews, and updates—the language of straight white men—you’re going to wind up with a lot of mismeasurement of what’s actually happening and likely to happen in these companies. Groups that lack privilege tend to be more measured in their commentary—because they are subject to more scrutiny. When you conflate hyperbole for ambition and realism for lack of aggressiveness, you will ultimately wind up shutting out a lot of groups from the game of risk seeking capital and opportunity.

  4. Trust is the first thing you have to establish in every professional relationship for it to be successful. When groups are homogeneous, trust is often assumed. When you look, talk and act alike, you can assume others are on the same page. You feel like these people will have your back—and this is a form of privilege when the group dominates your industry. As an investor, it’s easy to come into a board meeting asking probing questions, demanding information, and sharing your opinion without first having built up a base of trust. That comes from a shared understanding of why you’re there, your goals and objectives, and understanding how a founder thinks you can be most helpful to their company.

  5. There is strength and support in numbers. When you can introduce diverse founders to a diverse network of professionals, it makes their professional experience orders of magnitude better. Everyone needs peers, mentors, and champions and it’s helpful when those people come from a shared perspective. Creating this community doesn’t only mean backing diverse founders, but also surrounding yourself with a community of other diverse professionals to help your portfolio.

I feel incredibly lucky to be surrounded by a diverse community of founders, in the most diverse tech and startup city in the world. It allows me to learn more, be better, and checks my comfort level and privilege in unexpected, but positive ways.

Monday, February 4, 2019 - 11:01am

About a year ago, I received a LinkedIn connection from Richard Briggs—a Brooklyn Law Grad who spend 25 successful years at Lehman and was operating his own family office. He knew a bunch of other VCs in NYC and seemed like a great potential Limited Partner connection.

There was only one problem. Richard Briggs didn’t exist.

No Richard Briggs ever attended Brooklyn Law and none of our mutual connections had ever met him or interacted with him. He was a completely invented person—and no one connected to him on LinkedIn ever bothered to check.

I guess it’s pretty easy to get VCs to think that you’re a rich person interested in investing in their fund.

Just the other day, I got the following note:

Dear Mr. O'Donnell,

I am writing to you on behalf of Mr. SM Karabel (Chairman) of “Karabel Family office” which is a large Palm Beach based single Family Office with $1.9 billion under management plus real estate in NYC/Cal and 5 operating companies. Mr. Karabel would be delighted to meet with you for breakfast/lunch or drinks at The University Club in NYC during his upcoming visit to (NYC/CT Feb 26 - March 1st) or in south Florida (Palm Beach/Boca/Miami) area.

The office will shortly sell one of its large operating companies and plans to allocate all of the proceeds to investments. The Family Office has 20 employees does all of its allocations in house. I kindly await your feedback and look forward to hearing from you.

It’s possible that this is legitimate—that there’s some guy down in Florida who made over a billion dollars completely under the radar who wants to allocate all his new cash to “investments”. But, what are the chances that he also shares the same name and schools as a person in the same geographic area who lives in this lovely but somewhat understated house for a billionaire:

Screen Shot 2019-02-04 at 2.01.49 AM.png

Anything is possible.

It’s also really possible that the person who reached out to me is, in fact, a stock photography model whose LinkedIn photo also appears in this ad for gut bacteria improvement:

71YfHJ9BcEL._SY355_.jpg

Putting her name into Google, one of these ID landing page sites like Spokeo or Zoominfo ties her to the Family Office Club—an event company catering to ultra high net worth individuals located above a liquor store in a Florida strip mall.

Screen Shot 2019-02-04 at 2.09.41 AM.png

It’s certainly a very nice strip mall—but is it really the epicenter of investment activity for billions of dollars of family office wealth? Anyone who has ever attended any of these “family office” conferences will tell you probably not.

And trust me, I can tell the difference between a real family office and a fake one. I have an investor from a huge multi-generational Bolivian shipping family and they’d never attend anything like this.

Actually, I’m completely making that up. (Of course I am—Bolivia is a landlocked country.)

But how would you know?

How would you know if I showed up to an investor conference, took meetings with startups, and acted serious about putting money to work in venture on behalf of a family office whether I was telling the truth?

For the most part, you’d have no idea. Real family offices are pretty shrouded in mystery. They’re not setup to take inbound, so they don’t put up websites or participate much on social media—so it’s nearly impossible to tell who from the family office world is legitimate.

You know this leads to a lot of fraud. Some of it is probably pretty harmless—people getting into conferences, taking some free lunches, etc., but undoubtedly there’s some real harm being done by people who are telling people they work for family offices that actually aren’t. Most times, investors don’t actually invest in any given deal—so it’s not like someone is automatically a fraud if you don’t know anyone they invested in. You could ask 500 founders in NYC whether I’ve invested in them and still not hit any of the 60 that I have written a check to.

On the other side, trying to invest in venture capital funds on behalf of a family office must be a bit like being a legitimate Nigerian businessman trying to cold e-mail people. You probably spend half your time trying to convince people you’re for real. Plus, anyone that does actually find your e-mail is probably spamming you with deals that aren’t in your sweet spot, because you don’t put any criteria out there.

In the VC world, it’s hard to fake a job. Venture funds put up websites with bios of their professionals. They list portfolio companies—companies whose investors you can see listed on Crunchbase and other sites. I couldn’t go around telling people I work for Accel or that I’ve invested in Mulesoft, because it’s pretty easily diligenced.

Until family offices do the same thing—and transparency becomes the norm—you’re going to get lots of grifters and schemers, at best, ripping off people’s time and conference ticket money, and worse perpetrating actual fraud. It’s a simple industry fix—one that would save everyone else, including legitimate family offices, a ton of time. It would be in their best interest to be transparent about whose money they’re managing, what kind of investments they’re looking for (and not looking for) and who actually works for them. They’d cut down on spam and force the frauds to give up their game—because anyone without a easily referenced connection to real money would just go away.

Its possible that Mr. Karabel really does want to meet me—despite his employee not even mentioning anything specific about my fund or about venture capital, and perhaps I blew a big opportunity here.

But can you blame me for being skeptical as to whether it would be worth putting on a jacket and ditching my jeans to meet a complete stranger who doesn’t seem to have any specific interest in what I’m up to or knowledge of me?

I guess it doesn’t matter, because the person who sent this to me told me that “white trash does not get past security at the University Club” when I questioned the legitimacy of the cold e-mail she sent to info@brooklynbridge.vc—an e-mail address that truth be told I didn’t even realize I had.

I have a feeling that even if there’s a real billionaire here that I missed, these aren’t the kinds of folks I want to work with anyway.

Sunday, January 6, 2019 - 5:34pm

Ask any VC how excited on a scale of one to ten they are about their latest deal, and they’ll tell you eleven out of ten. Veterans will probably be a little more cautious and tell you they’re at a ten out of ten—but despite knowing all the risks, a VC simply isn’t going to get over the line unless they’re pretty blown away by an idea.

That’s because of the simple math of competition. I get 2000 things passing through my inbox in any given year, and I make about ten investments per year.

How excited do you think I am if I’m only picking the top 10 out of 2000? Do you think any of those handful of deals are seven out of ten? I see TONS of sevens—and they’re often the hardest ones to pass on. They’re nothing necessarily wrong with them. The team is good. The idea is good. It’s just—good. Nothing particularly striking that makes you think about it days and nights after the meeting.

I’m sure it’s incredibly frustrating for a founder to know that you have something workable and to not get any particular negative feedback, but not to get any traction in fundraising. You’re probably left scratching your head as to why.

It might be that your company is a seven—a perfectly acceptable, but not particularly exciting seven.

If you’re trying to be one of the best ten things I see in a year—that I’m willing to risk my investors money on knowing how hard it is to build a company, then a seven just isn’t going to make it.

That’s where the fundraising strategy comes in where you need to decide what you can do to really put your company over the top early. Maybe it means giving extra equity to a standout hire that really takes your team to the next level. Perhaps it means getting a bunch of customer LOIs even before you have the product ready—leaving VCs to wonder how you even got a meeting having so little built.

Think about asking investors what would make your pitch a ten—what crazy accomplishment that they could imagine would be gamechanging for your pitch, especially if you’re feeling like you’re not getting negative feedback. If you’re not getting negative feedback, but you’re not getting a check, you need to find out what you’re missing to move from a seven to a ten.

Reminder—this week I’m hosting another charity pitch workshop session. If you want me to go really in depth on fixing your story and presentation, while supporting some good causes, check out Fix Your Pitch for Good.

Monday, December 24, 2018 - 9:53am

It’s that time of year again—the season of people quitting their jobs soon to start a company. I don’t know whether it’s New Years resolutions or end of year bonuses, but I feel like there’s a bit of a peak in people wrapping up previous things looking to start something new.

If you’re going that route—here are a couple of things I would suggest:

  1. Have at least six months of personal expenses in the bank—and that’s only if you know you can at least get some angel capital based around your connections to investors, friends, family, etc. It should take you at least that long from having an idea before the idea is fully vetted in order for it to be worth investing in. Sometimes it’s shorter, but you always want to be conservative in this case.

  2. Understand where similar companies have struggled and tackle that part first. If enterprise sales is the hard part of what you’re doing, figure out how you can de-risk that first—maybe by trying to pitch some vaporware to buyers or perhaps getting them to pay you to build it on a consulting basis. Think about what investors are going to ask to see that you’ve done when you pitch, and how early you can pull proof of being able to do that into the present.

  3. Build a following around what you’re doing. Whatever you’re working on, it’s easier to do if you’re a leader in that space—so for the next six months, how can you visibly be a leader? Write a newsletter. Host events. Start a podcast. Build up the parade of people who will get behind you—because it will be easier to find customers, investors and hires as an insider than as someone trying to break in.

  4. Get out of the house. Too often, “working on an idea” means alone at your computer. Talking directly to customers and the people most familiar with a problem firsthand, because they worked at or started something similar, should be your first priority.

  5. Be deliberate in terms of what you want to get out of investors. Investors are better for pointing you in the direction of people in their network with expertise and letting you know how they think about your pitch—but not necessarily about the quality of the idea. Too often, an entrepreneur asks me what I think of something, when what I really want to know is what they think. You shouldn’t have to ask me if an idea is good—it’s your responsibility to know that it is, because you’re taking other people’s money to risk on it.

That being said, there is a lot of variability in terms of how an idea can be presented—whether it is well understood, etc. I’m working on two things that should help founders get early feedback:

First, I’m continuing my "Fix Your Pitch” series—where founders can get their idea workshopped in exchange for a charity donation. This way, founders who are far too early, or perhaps not getting the investor uptake they’re hoping for, can just skip to the front of the line while contributing to some good causes. I’m raising for Code Nation, the Brooklyn Bridge Park Boathouse, the Challenged Athletes Foundation and the Red Hook Initiative.

Second, I’m working on a new stealth project that enables founders to get feedback from investors in a fast and easy way. If you’re interested in testing out a way to understand if the investor market is keen on your idea, fill out this form to get in on the early beta:

Name * Name First Name Last Name Email Address * Thank you!
Monday, December 3, 2018 - 11:44am

Over the last five years ago, a disproportionate amount of venture capital funded paid acquisition on Facebook.  Some very large consumer facing businesses were built, but that gravy train won’t last forever—and signs are that it is seriously slowing down.  Companies are reporting that acquisition costs are trending up, and optimization is increasingly feeling like squeezing blood from a stone. 

Having 90% of your marketing dollars go not only to one channel, but to use just one company’s platform is always a risky strategy—but now, in particular, it feels like Facebook is at a serious crossroads.  Not since it’s pre-IPO days has the company looked so vulnerable. I’d even argue that the company’s continued attention dominance has more to do with the ineptitude of Google and Apple to build compelling consumer facing software than the quality of what Facebook is doing.  The core Facebook offering is declining in usage and engagement—and if it wasn’t for the acquisitions of Instagram and WhatsApp, more alarms would be ringing.

I’m not saying Facebook is going away—but the chance of a major shift in either the platform itself or the way consumers use it is increasing.  If you lived easy on a fancy waterfront property full time, and the chance of flooding went up for 0.1% to 5%, wouldn’t you give serious thought to buying a second home somewhere?   That’s what startup companies need to do with their marketing.

What I would argue is that companies should think more about building their own communities—and that, while easier, the mantra of meet the people where they are may have, to quote Batman Begins, “sacrificed sure footing for a killing stroke”.  Because companies never had to gather communities on their own, their ability to do so withered.  

It’s time to start the long and hard work of rebuilding that competency. 

Consider a thought experiment.  What if you got to keep the same marketing budget but couldn’t spend any of it on Facebook ads—or perhaps even Google for that matter.  You can post all the content you want to these platforms, but you just can’t goose it with ad spend.  Would you be able to, at some point, hit all your acquisition targets at the same cost?  How would you spend it?

Much of this spend would undoubtedly go to content creation, which will tie to SEO, experiential marketing, influencer strategies, referral and ambassador campaigns, events, etc.  You’d be forced to make sure that every bit of marketing you created would be worthy of engagement—attendance, sharing, etc. 

Shouldn’t it be anyway?  Did paying your way to a lot of shares and likes lower the quality of the marketing you produced? The content you create should all hit the bar of “If this is the only thing people saw of us, people would make time to consume it, they would understand what we were about, and they’d subscribe to more of it.” 

The only reason to rethink your marketing is that when you consider what it takes to get that next round of financing, investors are going to want to see you stand out in the ways that value in your business will be created. In the consumer category, the ability to stand out and acquire customers is paramount—and if you’re just mindlessly doing what everyone else is, you’re going to be harder and harder pressed to get a VC excited enough to fund future growth.

 

Tuesday, November 13, 2018 - 1:35pm

I’m not a fan of protectionism.

If I’m going to call it out when Donald Trump does it, trying to block the flow of free trade with tariffs, or block the flow of people through immigration bans, then I should be consistent about it on the local level. I would never say that one company shouldn’t be free to expand to a new city.

That being said, I don’t like paying people to do anything they were going to do anyway—and this is especially the case when it comes to economic incentives. It bothers me, for example, when condo builders get tax incentives to build luxury condos in NYC when it’s pretty clear you can still make plenty of money without them—and it’s not like they would pick up and start building condos in West Virginia if they got better tax treatment.

So when it comes to Amazon’s “HQ2a”, my hope is that NYC doesn’t break the bank offering the company lots of free stuff when it’s pretty clear that NYC has the most amazing talent pool on the east coast and is absolutely one of the most desirable places to live. I doubt the city really needed to offer them much in the way of anything to come here—so to be clear, I’m against spending taxpayer dollars to benefit big companies that don’t need the money.

That doesn’t mean I don’t want them here.

The presence of Amazon as a corporate participant in this ecosystem could be a big positive. For one, Amazon has the ability to attract talent from other places much like Google did when they first moved to NYC. Google was a net positive on the NYC tech ecosystem. No one works for big companies forever, so 3-4 years from now, we’ll start seeing Amazon talent hit the market, build companies, etc.

One argument I don’t buy into is “Amazon kills small businesses”. Amazon is a retailer—and any commodity item you’re buying on Amazon is, chances are, not something you normally buy from a small business. If anything, Amazon puts more stress on big box retailers. You’re buying things on Amazon you normally would have bought from Barnes & Noble or Best Buy. Sure, retailers take their pound of flesh when it comes to passing you on to their customer base—and that’s why so many business are trying to go the direct route—building online relationships with their own customers. There’s evidence, actually, that retailers that embrace experience are actually thriving in a world of Amazon. The number of indie bookstores, for example, has been growing for years. As it turns out, once Amazon killed off Barnes & Nobel, it created room for indie bookstores to return to the retail landscape, because it was bigger bookstores that were killing them, not specifically the internet.

I don’t mind an economic landscape where if I want to buy paper towel, Amazon sends it to me, but if I want to buy anything special whatsoever, I shop locally or directly with the brands I actually interact with.

One of the key questions people are asking is where all of these people are going to live, how they’re going to commute and what it’s going to do to existing economic inequality in the city.

These are real problems, that the local government hasn’t properly addressed for many years. We still don’t have a big enough housing solution, nor do we have adequate protections for the displacement that happens to certain neighborhoods during periods of economic growth. I would love to see the tech community work hard to lead the conversation on solutions we should adopt to make the growth of industry in NYC a positive and ethnically conscious force for change. I have no interest in seeing tech become the bad guy that it has in SF—but similarly, part of what’s going on there is a lack of will on behalf of the government to fix structural issues that tech is exacerbating.

I’m excited about the possibilities for Amazon in NYC—but cautious that our elected representatives will do the hard work to ensure they land in our community, not on it.

Monday, November 12, 2018 - 10:32am

Over the years, I’ve spoken at a bunch of NY tech conferences—and they vary widely in terms of their success.

A few things remain consistent:

  • Organizers complain how difficult it is to get people to show up.

  • Attendees don’t stay.

  • Even when they do stay, they’re not super engaged.

Here are a few tips for organizers if you’re going to put on a conference here. It’s very possible and I’ve been to some good ones—and the best ones all have some common attributes.

The biggest thing that conference organizers don’t seem to understand is the following:

New York City is not one tech community.

New York is a multi-industry town. We have media startups, healthcare startups, real estate tech startups, fintech startups—every kind of startup you can imagine. The advice, connections, and customers they seek are in all sorts of different verticals, and so it’s unlikely that you’re going to be able to build out a conference where paying hundreds of dollars and spending a day makes sense to someone if only 10% of the content and audience is relevant.

That’s become even more true as startup content flourishes online. In NYC, more and more people have joined startups, so they’re more familiar with the basics. Ten or twelve years ago, you could do a generalized tech conference about the “101” of startup life and a lot of New York founders would get a lot out of it, but now we’ve basically all gotten up to speed, read the posts, watched the videos, etc.

The only way to do a conference here that isn’t vertical specific is to make it about a horizontal—something that all startups have on their todo list that they find difficult, like fundraising, recruiting, marketing, etc.

And if you’re going to do a fundraising one, it needs to have real check writers—partners from known VC funds with deals in their track record people know. It’s ok if you get the occasional principal, but the majority of the speakers need to be people who could lead my deal that I wouldn’t otherwise be able to access. Analysts and associates aren’t difficult to access and they have less experience—and while they’re a smart bunch on the whole, they’re just not going to be a big attendee draw.

The other thing about conferences is that, in general, they aren’t very good—for either the audience or the participants.

People are growing tired of not only the format, but the lack of work actually put into the content itself. There’s a lack of research and vetting that goes into topics, and panel moderators fail to create narrative. Moderating is a skill. Invite people people who are good at it, or train them.

A few tips for panel moderators:

  • Know what you want the panel to say before you ask it. Create the narrative you want to share beforehand, and select your panelists and questions to reflect that.

  • Ask questions that will get at meaningful, specific answers. Don’t ask, “What are you seeing?” or “What’s exciting to you?” because the question is too open-ended to be weaved into a coherent narrative.

  • Don’t ask any question to more than two people on your panel, regardless of how many people are on your panel. You’re better off with less answers to more questions than the other way around, so bounce around, directing questions to specific people they’re most relevant to. After two, the answers get repetitive—and there’s nothing worse than a panelists wasting time with a “I agree with everyone else here” or “I don’t have much to add, but…”

Also, why does every session need to be a panel? Mix up the formats. Ask key, experienced attendees to lead small group sessions. Leave more time for hallway conversations.

Curation of attendees and speakers is incredibly important—which is why you really need industry insiders to be in charge of the content and speaker invites. Just because someone raised a round or two of capital doesn’t make them a great speaker with a compelling narrative—nor should they be asked how to run a successful startup, because they aren’t successful yet. Vet panelists and topics with the kinds of people you’d love to see at the conference before you invite anyone.

Diversity is not difficult—you just need to want it.

There are a ton more interesting people with unique perspectives on a topic that aren’t all straight, white and male. Just because they don’t sign up right away doesn’t mean it’s too hard to find them. Reaching out to communities of women and/or color with specific invites will help—as well as making sure these potential attendees can see people with similar perspectives participating at high levels at the conferences

If you want influential/VIP type attendees to stick around at the conference, you have to give them something to do. If someone is speaking at 2pm, they’re not going to necessarily come for lunch unless they’re captaining a table conversation. They’re not going to stay after unless you’re organizing some people for them to meet.

Every conference needs a Code of Conduct. Here’s one that I used previously. There’s no better way to empower victims of bad professional behavior than to explicitly state how people should behave, giving clear indications of organizers wanting to be aware when people step over the line..

Lastly, logistics is important to NYC conferences. If it isn’t near a subway, you’re going to be hard-pressed to get anyone to attend—unless you’ve already got a community following or you’re an oversubscribed conference to begin with. First year conferences really need to focus on lowering the barriers to participation.

Monday, November 5, 2018 - 10:11am

For the last two years, I’ve been pretty vocal about politics on social media, in my weekly tech community newsletter and on this blog.

As I’ve gotten older, I’ve gotten more progressive—which is a big shift for me because I grew up conservative. More and more, I’ve felt the need to speak out—but the question was asked of me recently whether or not it does more harm than good for me professionally.

It’s an entirely fair question—and the risk is that limited partners, founders, or other VCs might not want to work with me because I’m vocal about my political views.

Most people don’t think about it, but VCs need to raise money from high net worth individuals and institutions to have the money to put to work. These groups are much more likely to be more conservative than your average NYC or SF tech entrepreneur. (I mean, just about anyone is more conservative than the average tech entrepreneur, so it’s not exactly a high bar.) I suspect, though, there are even some founders out there who could be put off by the things I write and probably how I write them.

As a solo General Partner, my firm is me—and there isn’t a difference between investor Charlie and personal Charlie. When you get an investment from Brooklyn Bridge Ventures—you get me. When you ask me what I think about something—I’m not juggling two hats. My investment thesis is shaped by the sum of my personal experience and so are my values. My goal is to make Brooklyn Bridge Ventures the most accessible VC firm not just because I think it’s good business, but because I think it’s a based on good values. I don’t believe that your gender, school, socioeconomic background, race, identity etc. has predictive value for whether or not you can be a successful founder—and I think the next great 50 companies are going to be majority founded by people not in anyone’s “inner circle” today.

I also believe in treating people with respect and being helpful when I can—treating the world like a community where we all benefit from generosity and things aren’t always zero sum. These are both my business principals and my personal values.

The struggle I have with politics these days is that it doesn’t quite feel like a discussion of principals anymore. If you want to sit down and debate what the size of the government should be those are arguments I’m happy to have and can stay pretty respectful around.

But I don’t think that’s where we are today. It’s hard to ignore that some policies aren’t just disagreeable or not optimal, but they just seem, well, wrong. They feel wrong because they violate some basic values I think our country should be built around. They’re wrong because they seem more like power plays than positions—inauthentic political theater. They’re wrong because they’re clearly not working, or they’re only benefitting the privileged at the disproportionate expense of everyone else.

I understand that when you draw a right/wrong line, it makes people feel alienated and unwilling to engage—no want wants to have their values questioned.

I used to think that—that you could concede and negotiate in the search for common ground around values. For example, I used to debate the best tactical way to get to marriage equality—because I didn’t think that people in Arkansas or wherever were “ready” for it, and so I would say we should go state by state first, showing people that it wasn’t the end of families as we know it, and eventually have it spread everywhere

That was before I thought about what it would be like to be gay in Arkansas—and how sometimes tolerance of things we see as wrong can be just as bad as the wrong in itself, empowering those who would discriminate. Today, I’ve come to realize that calling out where you see injustice and wrong is the better thing to do, even if it offends some people.

Can I prove that I’m right about my opinions? I can’t prove that I’m right about any of this stuff any more than I can single-handedly prove climate change as a non-scientist—but I’m pretty sure we’re fucking up the environment and I’m definitely going to judge you for support of any policy that makes it easier to pollute, because you think climate change is debatable or that somehow economics justifies the destruction of our planet.

But what does that judgement even mean?

Perhaps I’m judging you, but so what? What right does anyone have to live their life free of the judgement of others? We get judged all the time. Limited partners judge my investment acumen. Founders judge whether or not they think I can add value. I judge founder ability and the level of homework they’ve done on a plan.

A co-op board is going to judge me at my next apartment.

Opinions are a dime a dozen, and if you’re not happy with someone’s opinions or their opinion of you—there’s really only three options. You can either take them to task—because maybe you think they’re wrong and you want to call them out and have a debate. You can just put on your thick skin and ignore them. Lastly, you can usually choose not to have that person in your life.

I’d hate for the third to be an option that gets taken too many times. I wouldn’t want to lose my relationship with my parents just because they’re conservative—no matter how many times we argue. I wouldn’t want to lose an investor because they disagree with my politics—because I strongly believe I can make great returns for them by investing in impactful companies. I wouldn’t want to lose a deal because I know how hard I bust my butt for founders.

But does that mean we can’t talk about it? Is it better to avoid the subject or to have those difficult conversations?

It’s probably going to happen that I’ll lose a few opportunities along the way—but I also think it’s going to happen that someone reaches out to me because of what they heard and wants to work with me because of it. In fact, I know it has. I know I get deal flow because founders want an investor who is going to be direct and tell them what they think—about anything. They want an investor who works from a set of shared values and not purely on a set of economic algorithms—because this is a people business highly short on data to make anyone’s algorithm work that well anyway.

Plus—the values of today’s innovators are getting more and more progressive everyday. They’re looking for better ways to share, to run cleaner businesses, and building more accessibility into power structures. They’re questioning capitalist models as the best solutions to every problem and examining where and how they feel comfortable profiting.

As investors, we’re in positions of power—and as we know from Spiderman, with great power comes great responsibility. We have to be conscious of our privilege and try to use our stature in the community to improve the world around us. Quietly sticking to investing means wasting the opportunity to do good. You should always feel comfortable talking to an investor about their values and their politics—and you have every right to work with people on the same page as you, no matter which side you support.

Monday, October 22, 2018 - 11:15am

In almost every single investment I’ve ever made, I can think of a singular moment in my relationship with a founder that, no matter what came before or what might come after, defined our relationship. Often times, it came in a very vulnerable and down moment for the founder—perhaps they just lost out on a big opportunity, had someone from the team leave, or they’re running low on capital before sales have come around. It happens to everyone regardless of how well the company is doing—because no path to success is a straight line.

While it might be a low point for a VC’s expected return on investment, it might demand of an investor a high point in their generosity and empathy—because a founder is going to remember who was there for them with confidence and motivation, and who either abandoned them or tried to take advantage of the situation.

Not only that, but the venture community is extremely small when it comes to investor reputations. Founders are tremendous advocates for investors who have their backs—but if you put a founder through the ringer unnecessarily, everyone in their circle is going to know about it, if for nothing else because they’ll need to talk through it with others in real time for guidance.

The key to having difficult conversations with founders is setting expectations. The worst thing you can do as an investor is to go back on indications of support or to blindside a founder that you’re changing the strategy around your professional relationship. If you’ve lost the confidence needed to follow on in a deal, that needs to be signaled right away. If you’ve decided not to invest in the first place, you need to say so as soon as you know it so you don’t string a founder along. If you’ve left your firm or have other deals that require more time, you can’t just become a ghost or check out on a founder after negotiating all sorts of legal incentives for the founder to be motivated for the long term, which makes someone assume you’ll be doing the same.

Failure stories are going to be told just as often as success stories—and investors need to make sure that even when the decisions are tough, they come early, consistently, and with transparency, or they’ll be one of the villains in an oft-repeated tale.

Monday, October 15, 2018 - 12:55pm

Being a founder means showing confidence. It’s nearly impossible to fundraise, hire, or lead without it—but at the same time, founders don’t know everything.

There are many things they’re going to be doing for the first time that are ridiculous to expect them to know how to do right off the bat. Just because you start a company doesn’t necessarily mean you’re automatically a good manager, a good recruiter, or good at PR. Yet, you’re under constant pressure to instill confidence in your team and your investors that you’re the right person for the job. Raising your hand to say that you’re struggling with something isn’t easy, but it’s a crucial job requirement.

The most successful founders excel at one thing more than anything else—learning. They ask a lot of questions and listen, putting into place best practices and systems that don’t depend on them just knowing everything outright. For example, instead of thinking that they have to be a great manager, knowing at all times how each person in the organization is doing, they put systems of evaluation in place that are both quantitative and qualitative so that everyone can be on the same page about job performance from a more objective point of view.

Systems take the pressure off individuals for lots of different aspects of the company. They allow everyone to know what their part is and how they’re going to be measured. They also help switch the conversation from “This person is good or bad at X” to “This is how we’d like to do things here and here’s how you’re performing compared to that.”

If a founder has issues with confidence, admitting they need to work on things can feel like opening old wounds of the worst things you think about yourself. You’re already convinced you’re not good enough, and so being asked to examine how you can improve can feel like a painful, all too well-trodden path or a slippery slope to feeling like you’re not good at anything. This is where it’s important to check yourself and be confident about what you bring to the table, while being objective and constructive about where you need some advice, a system, or training to help you perform better. No founder is perfect, and if you find yourself funded, employing people, and having already launched—you can’t be as inadequate as your worst insecurities tell you that you are.

Trust me, you’re not that good at faking it.

You’re an early stage founder with lots of potential and you’ll become a great executive one day if you’re willing to learn.

Tuesday, September 25, 2018 - 12:28pm

I started a company back in late 2007. We raised $550k in seed funding and, despite a lot of hard work, things didn’t work out. It turned out I wasn’t such a great product manager, the technical things we were doing were about two years too early—about to be made orders of magnitude easier by a lot of cloud and big data tools, and, oh, yeah, Lehman went under when I was pitching VCs for money in 2008.

Because we hadn’t raised much money, me and my co-founder didn’t take much in salary—but as things started to look like they weren’t going to work out, we took less and less. I was optimistic about my financial situation because I was in a relationship with someone graduating law school who I thought I was going to move in with. I was just bridging to the economics of scale of couplehood—at least, that was the plan until the relationship ended. That’s when things really went off the rails and my debt started to pile up.

The hardest thing about that situation was that there wasn’t anyone to talk to about it. Personal finance is a thing that no one likes to talk about. It comes with a lot of shame and embarrassment—that somehow if I was more successful or more savvy I wouldn’t be in this situation. I definitely should have saved up more—but I was also embarrassed that I wasn’t more successful at my startup.

What I did do was to create some boundaries for myself. I wasn’t going to sell my apartment and I wasn’t going to sell my car, nor was I going to touch my 401k. I was done when my credit card maxed out and my personal savings were both gone and that was it. When I joined First Round Capital in October of 2009, I limped in with about $31,000 in credit card debt and no immediate savings.

The reality, though, is that the salary I made isn’t realistic for everyone. If I had kids, I wouldn’t have been able to make it as long—but if I had kids, I probably would have raised more capital and just taken more dilution to cover that.

One of my investors made us feel like taking any salary whatsoever wasn’t enough sacrifice—and that they wanted to see us forgo salary until we launched a product. In hindsight, we probably shouldn’t have taken on that investor—because anyone that things that starting a company should be an exercise in putting thumbscrews to founders to create the most painful exercise possible to get the best results just didn’t share our values. Maybe that was their experience, or how they were best motivated, but that’s not how we worked best and you want to make sure every aligns on how to get the best effort from the team.

Founders need to feel empowered to build companies on their terms—and they should seek to find investors who align with their values. Your salary, what you pay employees, work hours, etc. are all very personal decisions for team members and there is no single formula for success.

Generally speaking, I back founders that I trust to understand that any money they take is money the company doesn’t have, while at the same time being self aware enough to know how they do their best work. If you cut your salary to $35k and you can’t afford to pay your rent or feed your kids, that’s not going to get me and my investors the best return on our money. It’s only going to exacerbate a long, slow, stressful death for the company because you were too stressed to make the right decisions for the long term value of the business.

If you’re in NYC and you’re interested in having a transparent and honest conversation about founder finances, check out the Financial Gym and their event on this difficult topic this Thursday. They’re a financial wellness company that I invested in built around eliminating the fear and shame around money and staffed with trainers who are experts in having honest and non-judgemental conversations.

Wednesday, September 19, 2018 - 1:07pm

You’ve got a great resume. You went to top schools, trained at a prestigious bank/consulting firm/etc, and you’ve succeeded in the corporate world doing some important and impactful stuff. Now you want to take that skillset over to the startup world and you’ve got a lot to offer. You can bring some serious business chops to a company that is going up and to the right but needs to take it to the next level.

Unfortunately, there are a few hurdles in your way:

1) It’s very difficult from the outside to identify which companies are for real—and also which are at the stage you’re looking for, which is out of the “might not be around next year” stage, but not already a unicorn.

2) You’re not a specialist—so a company at that stage would be hard pressed to hire you as a head of sales or marketing, for example, because there are plenty of people out there who already have that specific skill set with startup leadership experience behind it.

3) You’re at a point in your life and career where you’re not about to chance things on a company that might not be around in six months for zero salary.

These are all reasonable points—but the difficulty is that you’re part of a marketplace of talent where you’re in the mix with lots of other people with, at first glance, similar backgrounds. They’re willing to take a lot more risk for earlier stage positions, getting into companies before anyone has a chance to see if they’re going to make it, leaving very few opportunities open by the time they get to a stage you’re more comfortable with.

Still, these kinds of positions do open up occasionally—opportunities to lead new business units as General Managers, Heads of Business Development, COO’s, etc. The key is to be “nearby” to the opening when it comes up—to somehow be a known and trusted quantity, not just a resume. As investors, we do make these introductions to companies, but we do it with people that we can vouch for.

Accomplishing that means understanding how the key stakeholders, like founders and investors, spend their time. These folks are super busy and have learned to have a really high bar for 1:1 meetings. They’re not just grabbing coffee with any random former McKinsey consultant who wants to “get into the startup world”. If they did, they could fill their schedule with just that—that’s how many such requests they get.

You’ve got to bring something valuable—like talent, money, or visibility.

If you start making introductions to founders based on openings they have, that’s going to get you in the door. I mean, what’s the point of having a Harvard MBA if you can’t connect someone to the very best professionals. Same goes for business opportunities. If your classmates are running various groups within the kinds of companies these people want to work with, you can be an invaluable resource.

Why stop at classmates? If you know that someone from your school or extended network is a lot more senior to you and is seriously influential in a company that lots of startups would want to work with—why not host a meal or event for them to showcase what they’re working on.

Who wouldn’t accept an invite to “A networking breakfast where 7 midstage startups will be able to give short demos to the CEO/COO/Head of Business Development/etc for Big Interesting Company X that has huge reach/distribution/userbase, etc.” Maybe make it sector focused and bring in a bunch of such contacts. You could ask a bunch of VCs who would be relevant for those companies—and only ask that you bring Series A/B and beyond companies to the mix.

Now you’re offering value ahead of making asks for your own career—and doing it in a way that doesn’t require me to have to go for coffee (or in my case, tea) ahead of time with someone I feel like I’ve met a bunch of times before resume-wise.

Money works this way, too—and it’s a way to get in with VCs, especially smaller funds. Smaller funds are always looking for limited partners and co-investors in their deals—so starting an angel group or just being willing to make such introductions in your network goes a long way. You could run the same kind of group suggested above on a regular basis as a way to network with investors.

The point is, you’re aiming to build trust and show that you’re willing to offer value before asking for it. That’s what a founder and investors want to see with a senior businessperson before seriously considering them for positions. They want to know if this person can leverage their network in interesting and smart ways to create opportunities for the company.

Media is a great opportunity for companies as well. For those that want to also create visibility for themselves in the process as a smart and connected executive, how about creating a podcast or video interview series about “Hires that took the company to the next level” or “The next Unicorn”—i.e. the types of companies you want to be talking to. The secret to asking people to interviews is that they largely don’t care what kind of following you have—because they can always link to the interview in front of their following. So, worse comes to worse you’re just an outsourced segment producer for their content—and eventually with enough links, you will have that following. That’s basically the story of the 20 Minute VC—a random 20ish year old just started asking VCs to be on a podcast and, yada yada yada, a couple of years later he’s out with his own fund. The best part about this format is that you don’t actually need to be an expert—you just need to be able to ask good questions.

What this does for you is that it accomplishes the filtering mechanism as well. Instead of asking people “Who should I network with” which people really don’t have time to think about, you’re asking “Who would be interested in this opportunity I have—it’s only open to companies with at least X number of employees, funding, stage, etc. and we’re really trying to bring impressive up and comers to the table.”

Of course, you don’t have to take any of this advice. You could just e-mail me and other investors with your resume attached, request my time to help you (a one way street), and ask which companies are likely to be near riskless, high upside opportunities for you to get lots of employee options in.

Good luck with all that.

Wednesday, September 12, 2018 - 4:33pm

Whether you’re going through an accelerator or you’re at some kind of speed dating event, short “office hours” meetings present both an opportunity and a problem for investors. It’s a great way to get out from behind the e-mail and actually meet people face to face.

However, it’s a terrible way to get your whole pitch in. There’s just not enough time to convince someone to invest and have a productive back and forth.

So what do you do?

First off, change the goal. The goal is to get another meeting, not to get a check. That starts with the basics. Be professional and polite. A quick thank you for having them make the time is appreciated, especially because they’re likely doing this for a few hours straight.

It’s exhausting—so be excited and upbeat about what you’re doing.

Start off by sharing a quick plan for the 20 minutes:

“Here’s what I’d like to do… First I’d like to establish whether or not we’re the kind of company you would consider and then I’d like to outline the X number of things I think you’d need to believe in order to want to take another meeting with us.”

Describe the nature of your company in terms of stage, sector, etc.

“We’re an enterprise SaaS company solving X problem using Y solution. We’re pre-revenue and we have a team currently building a beta product that will be launched in four weeks. Is this a stage and sector that is a fit with your fund?”

If the person says no, you could ask them for suggestions on who you should talk to, or ask them their best piece of fundraising advice, or frankly, just give them their time back. You could say, “I’m going to e-mail you a description of what we do and a deck—should you meet up with any relevant investors, please feel free to pass this on.”

If they say yes, distill your whole pitch down to a few short things that an investor would need to believe to want to know more.

“For you to be interested, you’d have to believe the following:

That people are willing to pay to protect their privacy online.

That we have a team capable of user acquisition at scale based on our track record.

That the market size justifies venture financing.”

If they take an issue with any of your points, just share with them why you believe you’re right—but don’t try to debate it. You don’t have the time for that.

If you have time, share something interesting about how you do what you do—which, you can of course weave into the answers above—but 20 minutes goes really quickly. With some time left on the clock, ask them if you believe this warrants a deeper dive in another meeting. If they say no, just thank them for their time and move on.

Tuesday, August 7, 2018 - 2:11am

You may have heard that NYC is potentially going to cap the number of cars with Uber and similar services.  

On one side, Uber is adding more cars to already congested streets--and taxi medalians have been capped for years.  

On the other, you'll hear that Uber solves the transportation desert problem in NYC and also makes live easier for riders of color who are used to getting skipped over for rides.

I'm not there yet on whether I have an opinion as to what the right number of Ubers should be in NYC, but I do have a very strong opinion as to the treatment of drivers and other "gig economy" workers.

You see, Uber drivers, Taskrabbits, Relay bike delivery people, etc. are all 1099 workers.  Each individual trip and task is treated as a gig--a one-off project not unlike the way you might, for example, pay someone to design your website or code up an app.  

The problem is that 1099 offers near zero in the way of worker protections for anyone who does it like a full time job.  So, while a W-2 worker has protections around overtime and being overworked, 1099 workers don't have any.

I spoke to an Uber driver the other day.  He talked about the way Uber's rules deal with driving time versus total time.  Uber has a 10 hour limit on driving time--i.e., time on the clock with a rider--but up until recently, had no limit on the amount of time you could drive around trying to get to that 10 hours.  He said it would often take 15 hours to get 10 hours of rider time in.

A W-2 worker would have protections around 15 hour shifts and overtime requirements, but 1099s are SOL.

On top of that, when you take expenses into account like gas, leasing, and insurance, drivers are making below minimum wage.

It's been said that the city is considering putting in minimums for drivers, and I would say that before we cap the number of cars, we should be improving the lives of drivers.  Let's measure time in the car and make sure drivers are *netting* at least the minimum wage for all the hours they're in the car, because you literally can't earn the income without paying the expenses.  

This way, we focus on the first step of making sure Uber and others find a viable business model that doesn't involve abusing its workers.  Then, if it finds it can still exist, then we should figure out how many cars there should be. 

Interestingly, one of the ways it can do this is by increasing utilization--i.e. putting less drivers on the road, increasing wait times, so that each driver spends more time getting paid.  Right now, it floods the system with drivers to decrease wait times for consumers.  I, for one, would wait an extra couple of minutes if I knew that meant fair pay for drivers.

The City Counsel should use its leverage in this cap conversation to force Uber to pay drivers better.  If they really want to avoid the cap, they should be held to a higher worker treatment standard.

Wednesday, August 1, 2018 - 4:41am

Last September, I was introduced to Nicole Gibbons.  She's the founder of Clare, a modern paint brand that launched today to completely reinvent the paint shopping experience. 

She came in and shared all of the hassles that make buying paint a terrible experience--the difficulty in picking colors that actually look good with microscopic swatches, the need to go to a store and crossfit your way home with heavy paint cans, not to mention the harmful chemicals that are in so many paint brands.

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She knew all this from being an influential interior designer and detailed how she believed there was a big direct to consumer brand to be built in the space.  

Her plan was to close a bit first, first picking up $800k to start executing, and then fill out the rest.  

I asked her how far she could get with it--and which milestones she'd be able to achieve.  It only got her a handful of key features related to what she wanted for Clare.  I encouraged her to go out for the whole thing right off the bat.  

To a solo, first time, non-technical founder, asking for $1.6mm may have seemed like a lot to ask for for a Powerpoint--but it was so much better of a plan than launching something half as awesome for half the money.  Talking about a stepped raise can confuse an investor (and we are easily confused) as to what amount of money matches up with what goals--when the founder knows what they really need. 

It's so important for investors to recognize that different founders have lots of different views on how aggressive or conservative to be on a pitch--but underlying that sales strategy is a *real* plan that the founder knows they could succeed with if they could be successful with fundraising.  As an investor, getting at that without knocking the founder for their interpretation of what you want to here is the key to getting some under the radar deals that others might have overlooked.

Well, not only did she raise that money for a full launch, but she was *oversubscribed* and picked up some amazing additional investors like Imaginary, First Round, Able and Bullish, as well as the founders of Casper and Harry's.   

I'm excited to support Nicole, one of the most inspiring and dynamic founders I've met, and to be along for what promises to be an exciting and impactful brand in a huge space.  

Tuesday, July 31, 2018 - 1:37am

Decided to follow no more than 250 people on Twitter. If you got bumped, blame @willyf, who just made a good case for me to follow him. :)

— Charlie O'Donnell (@ceonyc) June 30, 2008

Just about 10 years ago, I tried hard to keep my Twitter follows to a manageable amount--to people I actually cared about following and either already knew or wanted to get to know in person.

5000+ follows later and I've failed miserably.  

It wasn't my fault, though--because the app itself, like all social networks, succeed around growth.  Every single feature is optimized around growing the userbase and increasing everyone's follower count, which means everyone's following count.  Networks are always telling you who from your contacts has joined and recommends you follow new accounts, even though you still only have two eyeballs in your head and 24 hours in the day.  The end result is that each person's connection to you in an ever increasingly connected network becomes more and more tenuous. 

A few years ago, I went to breakfast with Andy Weissman and he lamented Twitter's "Garyvee feature"--the turning off of the visibility of @ replies to people who weren't following the person you were messaging.  Basically, Gary Vaynerchuk would use the @ feature to message a ton of people at a time as he was scaling his following to try and scale 1:1 conversation as much as possible.  It wasn't particularly scalable as following him became a worse experience.  It was a firehose of listening to him not talk to you and just give shoutouts and the like.  However, when Twitter turned this off, while your stream became easier to consume (and easier for businesses or celebrities to interact with people en masse), it came at the expense of authentic discovery.  You never stumbled into half of an interesting conversation with someone you might want to follow based on the topic.  

There was a time when I thought Meetup Everywhere was going to be the next big thing--a social network that was dedicated to connecting people in real life was going to create a lightweight framework for people to localize the social network experience.  If groups got too big, it would be easy to enable splintering.  I don't know why it didn't take, but I've always lamented the failure of the web to create "neighborhoods" at scale that brought communities together (as opposed to just broadcasting to them like Patch).  

For a brief moment, tech was able to make my world feel smaller and more accessible, but now it doesn't feel that way anymore--and I have a theory that I'm part of a very narrow generation that even cares or notices.

There's an age group where you are old enough not to have Facebook in college, but young enough to be an avid user of tech--and to have used the internet to meet new people, probably through AOL or other forms of chat.  When we used dating apps, they weren't based around double opt-ins.  You regularly heard from strangers.  Ok, so it wasn't a *great* experience, but occasionally you'd find diamonds in the rough--and you had to take some risk around reaching out and getting rejected. 

Roughly speaking, this group probably peaks around 35-43.

Not only did we straddle a unique time in tech, but we also came at the tail end of real life neighborhoods as well.  When I was growing up, I would eat lunch and then run outside to play with my friends.  There wouldn't be any coordination between parents to make this happen.  I would just go ring doorbells to see who could come outside if they weren't already out.  It was just assumed that *someone* we knew--a parent or next door neighbor--would be on our street somewhere to keep an eye out.  

This experience made our local world feel very safe and accessible--where we regularly interacted with new people and made decisions for ourselves on who was safe and fun to play with.  We had positive experiences of meeting new kids and becoming friends all on our own, outside the confines of institutions like schools, camps, or parent organized play groups.  

Now, walking these same streets leaves you with a sense that someone stole all the children.  I'm not sure whether it's screen time or parental fear of abduction, but the kids seem to have disappeared from the street.  

It is this same age group that sought this out online--this same group that used Twitter to meet people and Foursquare to find where their friends were hanging out--in order to recreate the neighborhoods experience.  They built Barcamps and unconferences--semi-permeable spaces that got enough scale, but not too much scale, to facilitate people discovery and high quality conversation. 

I don't think we'll see a new form of social media ever attempt to make this happen again--because I don't think the builders of the next generation of apps ever really had this experience to know that it is missing.  Those that experienced it are now at a different point in their life where they're building families or at least coupled off and not really in network expansion mode.

These days, people gather to play a sport, to protest, to play games online, or to watch something--mostly with people they know are already like minded--and maybe that's fine, albeit a little one-dimensional, but sometimes it's nice just to gather in manageable numbers with people you aren't sure agree with you on everything, just for the sake of gathering. 

Can someone build that in a way that isn't contrived or creepy?

Tuesday, July 24, 2018 - 3:58am

I've seen this so many times over:

A founder pitches a VC, or several of them, and then they come back from that process with all sorts of new strategy goals or worries that they need to be doing something differently.  Nine times out of ten, if you're pitching more than one VC, the advice seems to conflict with itself, and the founder winds up playing Wack-a-Mole trying to figure out what to do next.  

What's going on??

The fundraising process is not intended to be a feedback process.  If it was, you'd run it very differently.  Founders would ask for very specific pieces of advice on topics they thought that particular investor would have some insight into.  Instead they often just dump everything they they know about their company on the VC's lap and ask for any kind of feedback whatsoever, leading to really messy data.  

So why is this feedback seemingly all over the board?

First, let's be clear--when you walk out of a VCs office and don't get a term sheet in the next week or at least another meeting with the partners necessary to make a decision, it's a pass.  Lack of a yes is a no--so anything that firm tells you should be taken with a grain of salt.  They don't want to invest in your company.  Any advice they have for you is going to be a bit broken.  It's a bit like if someone doesn't like ice cream and then says your favorite ice cream is too sweet.  First off, you need to drop that friend like a ton of bricks, and second, making that ice cream less sweet isn't a good idea.  They don't like ice cream--so no amount of sweetness reduction is going to make them happy.  That's not helpful feedback.

Second, the feedback is incomplete.  Since you didn't ask the investor to write you a complete strategy guide, all they're doing is giving you *one* of the reasons they passed.  There could be others--so many others that following up on just that one protest might still not lead you anywhere.  Just the other day, I was talking to a founder who was told by a Series A fund that they normally invest in companies around $125k/month in MRR.  She assumed that by getting to $150k/month, they'd automatically invest.  What that investor left out was that before they were going to write an $8mm check, they'd also want to see a marketing funnel established to get leads, an actively growing sales team that showed that the process could be replicated, and growing revenues within each customer.  Otherwise, one awesome enterprise salesperson in a market where contracts were big and good product would be enough--but no one is going to write a check that big to a virtual team of one business person and some devs.  

Lastly, the most important piece of feedback--the team feedback--almost never makes its way back to the founder.  Sometimes, VCs will walk out of a meeting thinking, "Ok there's no way I'm ever going to fund THAT guy," so they just make something up or make something small into something bigger.  They'll never tell you to your face that you're pretty much unbackable, so focusing on any other advice you got from them isn't going to fix the issue.

How do you solve this?

We're working on something cool at Brooklyn Bridge Ventures to address some of these questions.  :)

Tuesday, July 10, 2018 - 1:22am

Recently, I helped one of my portfolio companies make a VP of Marketing hire.  The founder asked me early in the process if I thought the candidate was good.  

Having not worked with her previously, I didn't know how talented she was firsthand, but what I did have confidence in was that her strategy would be well thought out, and if it wasn't working, she'd analyze why, proactively address it, and describe what steps she would take to find a solution.  She struck me as having an disciplined approach to her job, and over time I think discipline wins over raw talent everyday.

Discipline comes with a reasoned approach--a way of breaking down any situation into component parts, addressing each carefully, and sometimes finding help to address the ones you're not able to handle.  Startup life comes with a ton of variables and if you're not trying to bring order to the chaos, you won't be able to scale your effort as things get bigger.

Discipline also helps take responsibility off of a founder's plate--and that's something every founder needs and welcomes.  When you build in methodologies to your job, the founder that you work for can trust your approach in future situations, and they can make like for like comparisons in your performance over time--essential to oversight and process improvement.

Raw talent, on the other hand, has a limited shelf life.  Things change very quickly--so while you might shine in a particular situation, that approach might not work in your next job.  Someone who is great at writing blog posts might struggle in the shorter form media that has become more popular.  A community manager of fans and users might not have the same knack for inspiring user-owners who are participants in a token-based ecosystem where they benefit from improvements in a system in which they are also stakeholders.  A recruiter who is just really good with software developers might not be able to switch to sales recruiting when needed if they don't come with a disciplined approach that can be tweaked for a new situation.  

Lastly, talent without explanation of approach and discipline can actually just turn out to be luck.  When you hire the person that took X company to success, you might find out that if they can't tell you what it was that worked and why, and the logic of how they approached things when they first started, its possible that the company succeeded in spite of them.  Perhaps they weren't really so much the driver versus just coming along for the ride.  

Charlie is a Partner at Brooklyn Bridge Ventures, working on very early stage investments in the "Greater Brooklyn" area, which also includes Manhattan and the other boroughs of New York City.