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By David Frankel, Managing Partner

Granting options to your employees is a wonderful perk of being a startup CEO. It’s a rare thing to be able to offer an employee a potentially life-changing sum of money! But in order to get options approved you need to work with your board.

Here is how to do it right.

The key principle is clarity

Discussions around options shouldn’t be confusing, but they can easily become so if the spadework isn’t done ahead of time. At the early stages, there is no reason for this process not to be crystal clear.

Don’t rush!

There are plenty of times where you’ll need to activate a sense of urgency among your investors. Getting stock options approved should never be one. It’s a sure way to signal to your VC’s that things aren’t running smoothly. …


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By Micah Rosenbloom, Managing Partner

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.

Here are 12 questions that founders should ask potential investors more frequently:

↗️ Do you lead?

You want to start your process by finding a lead investor. If a given fund doesn’t lead deals, keep talking to them, but prioritize finding a partner who will. Many processes die because founders can’t find a lead funder.

I can’t stress this enough. It’s easy to find a dozen firms that want to fill out a round, but most will want someone else to lead first. A lot of founders will get 3+ meetings into a process before discovering this fact — a HUGE waste of time. …


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By David Frankel, Managing Partner

The range of fundable startup ideas has expanded over the last decade to encompass everything from Slack to slacks. Now, the challenge is separating interesting, but niche markets, from those that are weird and wonderfully profitable.

A few thoughts on an imperfect science:

🔮 Odd ideas + simple business models

We’re open to entertaining the most fantastical sounding markets if the founders employ a vanilla commercial strategy. We’re not looking for conservative approaches, just paths to market that don’t require massive leaps of faith.

We’ve luckily backed everything from aquaculture to zoological testing and while we cover a lot of unique markets there is a common thread: commercially-minded founders obsessed with monetizable customer use cases. …


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By Eric Paley, Managing Partner

🤖 Product-first companies are inspired by a breakthrough in technology or UX.

Awesome!

📈 Market-first startups are built in response to glaring inefficiencies.

Awesome!

🤑 Capital-first startups are catalyzed around access to capital.

Beware!

Capital-first startups start with a hazy sense of a problem, a rough idea about how a product could solve it, and a crystal clear conception of why they should raise maximum money, now, and at the highest possible valuation.

Spotting these startups is easy:

🏀 They build teams before they’ve tested a hypothesis

🏙️ Space is leased before wireframes are crafted

📜 Press releases are issued before customer personas are fully…


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Have you:

❤️ Witnessed the challenges of the founder’s journey and have empathy to support them?

🌱 Believed something would work when everyone told you it wouldn’t?

🔭 Seen product/market fit gel when you weren’t sure about either at the start?

If so, you may be a great fit for our Senior Associate position! The day-to-day of our next Senior Associate is highly variable and is fairly similar to our Principal roles, but you’ll have three key responsibilities:

Meeting with Founders

We invest in everything from Ad tech to Zoological DNA testing. You’re going to hear pitches for things like online pharmacies, web-based security systems, Korean ecommerce, self-driving cars (and on-demand black car services), many shades of SaaS, and so on. …


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By Micah Rosenbloom, Managing Partner

When we meet with entrepreneurs, our goal is to find founders who are “all over it.” We’re looking for operators who can draw a treasure map to navigate markets that bewilder most onlookers. This is also a trait we look for in the people who join our investment team, and we believe our new Principal, Amanda Herson, possesses it in abundance.

Entrepreneurship was the topic of dinner table discussion growing up for Amanda. Her family owned and operated a small group of army & navy surplus stores in Cape Town, and she spent her weekends and vacations working the registers, stocking shelves, and learning the art of selling. …


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By Micah Rosenbloom, Managing Partner

The “socially distant party round” has become the hot financing vehicle of 2020. Still, managing a cap table with…

🚀 Accelerators

😇 Angels

💵 Pre-seed/Seed/Seed extension(s) VCs

1⃣ “Solo capitalists”

…can be a challenge.

Some thoughts on how to maximize ROI

Small investors are no longer seen as tourists — instead, they’re revered!

And most good VCs of any size want to help — it makes them feel invested in the company beyond the capital they’ve contributed.

The trick is knowing what to ask for, from whom, and how.

👋 Step One: Keep you investors updated

Big cap tables often come with impressive networks. …


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We’re looking for a new Principal for our Harvard Square office.* To give you a sense of what daily life is like at Founder Collective, we’ve assembled an example schedule for our investment team’s newest member:

9:00 AM — Zoom call with an entrepreneur: It’s hard to say what kind of company will start your day. It could be anything from Ad tech to Zoological DNA testing. …


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Every pitch deck needs a “team” slide. Most aren’t as good as they could be. Here’s how to improve them.

Every pitch deck needs a “team” slide. At the early stage of a startup when the product concept is fuzzy and revenue is non-existent, VCs are essentially backing the team above all else. But almost all team slides are sub-optimal.

A standard team slide usually has:

📸 Pics of the founders/key execs

✒️ Names & titles

🏆 Each person’s affiliations: Prior companies they’ve worked at, educational institutions they attended, awards won, etc. (Ideally depicted with logos!)

That’s basically it.

IMHO, the big weakness of this format is that it only really provides a sense of a) how well they fit into the modern meritocracy, and b) how photogenic they are. It’s a fine tool that provides a 30,000-foot view, but it also leaves so many questions open, e.g.: …


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We’re often asked by entrepreneurs, VCs, and others in the entrepreneurial community, “What kinds of companies do you invest in?” The short answer is — almost anything. We’ve backed startups in industries ranging from AdTech to Zoological DNA tests.

💻 Software is a key lever in most of our investments.

💵 We favor founders who are commercially oriented.

🌱 Our investments happen exclusively at the seed stage.

Beyond those guidelines, we’re open to almost anything. Here’s a sample of the startups we’ve backed:

A: AdTech: TheTradeDesk IntegralAds Moat

B: B2B SaaS: Airtable Drift

C: Consumer transportation: Uber

D: D2C cologne…

About

Founder Collective

Our mission is to be the most aligned VC for founders at seed. #ProudInvestor in @Uber @TheTradeDeskinc @Buzzfeed @Cruise @Diaandco @PillPack @SeatGeek & more.

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