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We’re proud to share that Eric Paley, our long-time partner and dear friend, has been appointed Secretary of Economic Development for the Commonwealth of Massachusetts by Governor Maura Healy.
If you believe AGI is close, how do you justify backing a startup with a 5–10 year horizon? It’s a fair challenge, and one that deserves a better answer than: “We believe in founders.”
As one LP told me, “You’re going to be wrong for selling too early or wrong for not selling – either way you’ll be wrong.”
How do ambitious founder-parents keep it together when life throws pacifiers and pitch decks at the same time?
Apple’s Illusion of Thinking reminds us that transformers may asymptote to human ability and that may be enough to transform the world.
At Collective Future, Red Antler’s JB Osborne explained why vibes are the key to ROI in the age of AI.
Myth Model Takers, Not Model Makers: The Reality of Modern AI Work
The career ladder is breaking. The new edge: critical thinking, systems fluency, second-order reasoning, and the ability to orchestrate.
Board meetings steal hours from your calendar. If you’re not getting sharper, you’re just burning time.
You no longer need a fleet of middle managers to build something big, just a small team
Things I overheard in conversation with a $50B product leader and the head of product at the hottest AI product company around.
Founders never rested, now no one does
The rarest skill isn’t building fast anymore—it’s knowing what’s worth building.
Venturing in Public — 4/30/25
Minting Money in the Foundation Model Gold Rush
For the last decade, the “endless aisle” was the mantra of every omnichannel retailer — infinite options, ultimate convenience, and unlimited scroll. But choice is no longer empowering. It’s paralyzing.
You can’t build 10x software with 1x interfaces
What AI remembers, what it forgets—and what never makes it into training
Venture capital has bounced back from 2021, but the competition to get into the hottest companies has continued to drive valuations to extreme heights.
Why tool use is getting commoditized—and what still counts as a moat in the age of MCP.
Venturing in Public 3/26/25
Venturing in Public – 3/20/25
In looking at the portfolio recently, I was surprised to see that our DTC portfolio – ranging from baby toys to cat food, furniture, skin care, and more – will do over a billion dollars in sales this year. A billion in sales!
Think of each funding round as part of an ongoing strategy—a multi-stage game, where every decision has ripple effects on the long-term trajectory.
We’re thrilled to announce that Jack Arenas has joined Founder Collective as the new Principal in our SoHo office. He represents the value and ethos of FC – he’s a builder at heart, lived the ups and downs of the founder journey and loves to work with founders across the tech industry.
After a decade of building and scaling startups, I’m excited to embark on my next chapter as a Principal at Founder Collective in their NYC office.
VCs are famous for asking startups, “What is stopping Apple, Meta, and Alphabet from doing this?”
Pivots are part of many successful startup stories, but there’s no clear playbook on how to make them work. There should be no shame in pivoting, despite what many founders think, but they need to be well thought out before burning the boats.
When I started in VC, there was one incentive — capitalize startups, help founders build their businesses, and bring in additional capital (when necessary). Hopefully, if the stars aligned, the funds delivered outsized financial returns for the risk, ideally 3X or more, to their LPs. This model was a relatively well-tested formula for venture-backed startups — provide enough capital to the company (but not too much) and maximize its chances for a healthy return, hopefully in less than ten years.
AI is going to change everything. At least, that’s what everyone in Startup-land believes.
Fifteen years into my venture capital career, I’ve come to believe there are two undeniable laws of startup physics: 1) Capital compounds both positive and negative formulas. 2) All positive formulas compound at diminishing rates of return.
Staying true to our roots with a new Fund
If you work in tech or have attended a conference over the last ten years, you’ve likely come across S’well water bottles. Sarah Kauss, an accountant turned entrepreneur, invented the iconic, insulated vacuum flask as a sustainable and stylish alternative to single-use plastic water bottles. Sarah launched the product in 2010 with $30,000 in savings and grew the company to over $100 million in revenue annually while turning hydration into a form of sustainable haute couture. And she did it without a drop of venture capital.
I couldn’t be more excited about joining the partnership at Founder Collective. The last two years on the team have been energizing, and I am even more bullish about the next 20.
VCs offer a lot of advice from a 30,000-foot view. Here are 7 bits of practical wisdom I gleaned when managing a large, resource-constrained, growing team that you can apply to your startup today.
Being a successful venture capitalist requires various skills, but we believe that the ability to empathize with founders separates the good from the great. The first years of a startup are a rollercoaster of stress for founders where success is unpredictable and sometimes seems out of reach. Most investors have no idea what operating under that level of ambiguity is like, but Amanda Herson does.
As capital gets scarce, I want to relay a few thoughts on startup marketing that Kayak founder Steve Hafner recently shared with the Founder Collective portfolio.
The next year will be challenging for startups. Promising companies will struggle. Many will fail. The only consolation is that the “era of indifferent capital” is coming to a close — may it never return.
An unrepresentative, statistically insignificant, but still interesting peek at the current M&A market
Entrepreneurs are often so fixated on “getting to yes” with a VC — and will go to great lengths to answer any question posed to do so — that they forget to ask the VC any questions.
There’s never been a better time to build a company outside the Bay Area
You can put off monetization, but not thinking about monetization
Many “atypical” markets are surprisingly M&A friendly, but VCs may not recognize the potential buyers without guidance
As entrepreneurship has professionalized, jargon has proliferated, and platitudes pervade pitches. One helpful tool to combat this scourge of short-hand is:
🏕️ “The Summer Camp Test” ⛺️
I recently tweeted about the importance of financial models in evaluating seed-stage pitches
A high-quality startup problem is when the company starts to scale but one of the co-founders can’t grow at the same pace as the other. It’s a good problem but a real challenge nonetheless. Here are some thoughts on how I’ve seen it handled well (and not).
I’ve had the good fortune to be an investor for almost 15 years and have backed 100s of startups. Only one company in all that time deliberately defrauded its VCs.
Even for strong startups, fundraising is a marathon that requires near constant attention for 8–12 weeks. The process is punishing, and riskier than you might imagine. You need to prep for it as seriously as you would a race.
One of the secrets of B2B entrepreneurship is that a good enough product with exceptional distribution will win more often than an exceptional product with mediocre distribution.
When getting ready to pitch VCs, founders often jump right into assembling a slide deck. I think this is a mistake. I’d suggest that you start by writing twenty headlines that sum up your startup, and only then build the slides.
One argument I hear in favor of big $$$ fundraising is that it will help in recruiting. It’s a logical enough belief but mistaken. It assumes there’s a linear relationship between the amount of funding raised and caliber of recruits.
I have the great privilege of seeing a lot of startup pitch decks and have noticed a few common narrative patterns that are counterproductive for otherwise interesting companies. If you’re getting ready to pitch a VC, try to avoid these traps.
If you’re pitching investors, one of the easiest ways to improve your deck is swapping out blank interstitial slides, or the dull logo cover slide, with pictures of your product in use or in context.
In my role at a VC firm, I have the privilege of seeing the pitch decks of startups as they set out to raise new funding. In the main, they’re masterful, but I’ve seen a lot of founders making a similar mistake—including quotes from random users in their presentations.
These are the liquidity events that give the impression that startups are a great way to “get rich quick,” even though building a saleable company often takes the better part of a decade. Less often discussed, or championed, is a third option — the “get rich slow” method of building a company and making millions of dollars in profits, for years or decades.
The “Series A crunch” sometimes still feels real. It dooms many startups that could otherwise have easily survived if they had been more strategic about their seed-stage fundraising.
In a world where IPOs are an unlikely outcome and traditional M&A exits are difficult to manufacture, there is a new alternative for liquidity starved founders and investors — The PE exit. It’s an invisible ecosystem to most, but when you see a headline about a PE firm making an “investment” in a mature SaaS startup, and there is no mention of valuation, or even what series it represents, you’re most likely witnessing an acquisition, of sorts.
While collecting the stories of more than 50 startups that got big before they raised venture capital, it was surprising to learn how many founders claimed to get their business off the ground with just $5,000-$10,000. In a world where companies that have raised more than $5M describe themselves as “seed stage,” a four-figure sum seems insufficient to start a billion-dollar business. But it’s not. So, how do you become humongous with humble financing? There are a few principles that seem common:
In 2007, Groupon took in the first million dollars of what would ultimately be $1.4B of venture capital, raised with ambitions of reshaping shopping. For a while, it looked like group buying, social commerce, daily deals, or whatever you call the practice of time-limited sales paired with social pressure was really going to change buying behaviors in a big way. In the space of four years the category exploded:
There’s a widespread belief among founders that venture capital is a precursor to success. It is true that VC is a common denominator of the most successful tech startups, but it isn’t a prerequisite, especially at the early stages.
There’s no good way to tell your board that you’ve blown a quarter, or your superstar head of data science is jumping ship to Google. Still, breaking bad news is a key skill for founders and delivering it well is often what keeps a company alive.
When I used to write for Wired, a cold email was the lowest probability way to get press, but it still worked with some regularity. Cold emailing a VC is a similarly low-percentage play, and many of the best VCs in the world advise against the practice. Still, it does work from time to time.
In my role at a venture capital firm I have the good fortune to see a few dozen pitch decks a month. Some are brilliant, and others require more time to bake, but almost all of them waste the first slide.
For some entrepreneurs, raising capital is effortless. When you see a company raise tens of millions of dollars, series after series, especially if they have few other milestones to promote, you know you’re in the presence of a world class presenter. Fundraising is a startup super power, just like consumer product instincts and B2B sales acumen. Some founders are just “natural athletes” who possess a knack for storytelling paired and charisma, typically topped off with some credibility in a prior venture.
David Pierce has written an excellent post-mortem recording the last days of a hardware startup called Doppler Labs. The post carefully details all the challenges in launching a consumer product, and Doppler Labs co-founder Noah Kraft provides a colorful summary of the experience:
There’s a lot of good advice on writing investor updates, but one of our portfolio CEOs recently wrote an update that was so good that I thought it could serve as a template for entrepreneurs everywhere. It’s B2B focused and largely positive in tone, but it’s easy enough to copy, paste, and customize for B2C startups or less upbeat news. Just swap out the [bold] content and you can keep your investors in the loop with almost no effort.
“I need to find a industry or product I’m passionate about.” I often hear this from entrepreneurs and it frequently means wanting to start a business in a consumer space that they love—music or gaming, for example. It’s an understandable impulse. If you’re going to start a business that will consume your life for years, why not make it something you’re interested in?
Imagine you’ve spent years working on a startup with the hope and a credible plan to build a billion dollar business and along the way get an offer for $100M? You still believe in your vision, but a nine-figure sale would represent a rich premium based on your traction and early revenue growth. Should you take it?
Hundreds of millions of people use Firebase-powered apps every day, though they may not realize it. The company started as backend-as-a-service for app developers that made real-time functionality simple for Shazam, NPR, SeatGeek, and hundreds of thousands of other services.
One of the questions a VC gets most often is “what are you interested in?” Many investors have developed “themes” that become a shorthand used to discuss the types of deals they like
Do companies that load up on venture capital actually outperform those that more efficiently deploy capital? We looked at 71 tech IPOs from the last five years to find out.
Capital has no insights. Don’t trade a solid business for a lottery ticket.
We’ve been trained by infomercials that “But wait, there’s more!” is a powerful sales pitch. Not surprisingly, this approach is used frequently by entrepreneurs pitching their startups. Somewhere between slides 12 and 15, the passionate founders take a breath, clear their throats and declare “But the real opportunity in this business is …”
Getting courted by investors is an exciting milestone for any start-up. But when the VCs start calling, don’t let their enthusiasm cloud your judgment.
