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After ~1 year at Cowboy focused entirely on seed, my frameworks for investing at this stage have changed.
Still (and forever) learning, but sharing my current thoughts on seed investing
Still (and forever) learning, but sharing my current thoughts on seed investing
1/ Founder > market
Investing at seed often means investing when the market opportunity/size isn’t clear. I believe it’s more important to invest in amazing founders than amazing market opportunities*.
*network effects businesses excluded
Investing at seed often means investing when the market opportunity/size isn’t clear. I believe it’s more important to invest in amazing founders than amazing market opportunities*.
*network effects businesses excluded
2/ Partner w/ "Learning Animals"
I picked this one up from the queen of coining new terms @aileenlee. Founders with a growth mindset can adapt to changing market dynamics & develop into successful leaders at different stages of growth.
I picked this one up from the queen of coining new terms @aileenlee. Founders with a growth mindset can adapt to changing market dynamics & develop into successful leaders at different stages of growth.
3/ Build for tomorrow
Founders at seed are building for tomorrow's world, not today's. They need foresight grounded in a deep understanding of the tech & market forces driving change.
This is framed very well by @m2jr in his piece on "Backcasting". https://medium.com/@m2jr/how-to-build-a-breakthrough-3071b6415b06
Founders at seed are building for tomorrow's world, not today's. They need foresight grounded in a deep understanding of the tech & market forces driving change.
This is framed very well by @m2jr in his piece on "Backcasting". https://medium.com/@m2jr/how-to-build-a-breakthrough-3071b6415b06
4/ Diligence should not convince you to make an investment
Using diligence to move from "no" to "yes" is dangerous. It can result in projecting a vision on founders that isn't theirs.
S/o to @twang for keeping me honest on this point.
Using diligence to move from "no" to "yes" is dangerous. It can result in projecting a vision on founders that isn't theirs.
S/o to @twang for keeping me honest on this point.
5/ Why (this founder) now?
I used to obsess over “why now” but have edited that to “why this founder now”. At Cowboy, we look for 'earned insights' that demonstrate a founder's unique understanding of their space in addition to the tech/market trends supporting "why now".
I used to obsess over “why now” but have edited that to “why this founder now”. At Cowboy, we look for 'earned insights' that demonstrate a founder's unique understanding of their space in addition to the tech/market trends supporting "why now".
6/ Find talent magnets
This extends to advisers, early engineers, other investors, and any other high-quality ppl the founders have convinced to spend their precious time helping them. This can be a huge point of leverage early-on.
This extends to advisers, early engineers, other investors, and any other high-quality ppl the founders have convinced to spend their precious time helping them. This can be a huge point of leverage early-on.
7/ Invest in products w/ a fast 'time to wow'
This is so important for seed-stage companies to drive early adoption, usage, & customer/community love.
This is so important for seed-stage companies to drive early adoption, usage, & customer/community love.
8/ Back companies that can get to Series A
Our companies usually raise multiple rounds & need to hit milestones to raise more $.
At Cowboy, we consider this in diligence & do an all-hands session post-investment to fine-tune milestones & have a path to get there (hiring, etc.)
Our companies usually raise multiple rounds & need to hit milestones to raise more $.
At Cowboy, we consider this in diligence & do an all-hands session post-investment to fine-tune milestones & have a path to get there (hiring, etc.)
