Brad Feld

Month: June 2014

Google dominates search. Sure, there’s a thing called Bing and a few other choices out there, but everything ends up being the blue and purple link thing curated mostly by machines.

In an effort to experiment with a different approach, we recently led an AngelList syndicated investment in one potential search challenger, a Kansas City based startup called Leap.it who is taking a different approach based on the belief that machine-based algorithms can only get you so far. They hypothesize that by injecting social and real-time data, along with interactions with real people, your search results become much better.

When you first visit Leap.it you will immediately notice that they completely do away with search lists. Instead, their search results are presented in cards that include web, video, social, and image previews.

What I find most compelling are Leap.it Perspectives. With Leap.it, anyone can collect, collaborate, and share results on any subject and then have them show in future, related search results.  I have a few of my own Perspectives that highlight my background:

If you find something missing from any of these different perspectives, you can add to the perspective once you’ve logged in.

Fundamentally, Leap.it is trying to integrate the notion of search directly with the real-time web and the extended social network faciliated by services like Facebook, Twitter, and LinkedIn.

Give it a try, create a perspective, and tell me what you think of it.


I’ve been stalled trying to get through two books: Startup Opportunities (with Sean Wise) and Startup Metrics
(with Seth Levine). Dane McDonald (FG Press CEO) and my assistant Eugene Wan created a book cover recently to try to inspire me, as an homage to Do More Faster (with David Cohen).

write more faster

It worked. I’ve gotten a lot of writing on Startup Opportunities done in the last week and I expect this week to be a good one.


Lots of people get married on the summer solstice. To all of them – including those getting married today – congrats and welcome to the club!

It’s a particularly sweet club on your 21st anniversary if you are a numerophile, which is a word that Amy and I just made up that describes people who love numbers. And blackjack. And Dragons. And Daenerys – what a serious badass she is. And Arya also. But I digress. Can you tell that we recently figured out how to watch the Game of Thrones season finale up in Homer?

21 years ago Amy and I woke up and decided to get married. We were on vacation in Alaska, hanging out in Fairbanks at the time. Amy grew up there so she loved to point out all the things that were completely unchanged since she was a child. We took her mom and her nephew Drew out for Drew’s birthday breakfast at Sourdough Sam’s, which was one of those unchanged places. Her mom asked what we were doing that day and we turned to each other and said “getting married.”

Yup – we eloped.

We went to the Pay-N-Save and bought six rings for $1.19 (we still have them). We then drove up to the top of Ester Dome. I took out a piece of paper and wrote the word “VOWS” on it twice. I tore the paper in half and gave half of it to Amy so we each had vows to exchange. We each grabbed one of the rings. Amy recited the traditional marriage ceremony. We exchanged VOWS and rings, hugged, and kissed.  And that was it.

It feels like yesterday. Well, not really. But it’s been amazing. We’ve had our ups and downs, including nearly getting divorced (which I recount at the beginning of our book Startup Life: Surviving and Thriving in a Relationship with an Entrepreneur (I know you see what I did there, Brad-the-book-salesman.)  We moved from Boston to Boulder in 1995 and never looked back. We thought briefly about moving to Homer, Alaska but decided instead to buy a house up here and spend a month each summer up here.

As I sit on the couch in our house in Homer, two feet away from the person I love spending time with more than anyone else on this planet, I feel so lucky that I’ve found someone to spend my life with who understands me. Who puts up with me. Who treasures me. Who holds me when I’m down. Who celebrates with me, but also keeps me humble and chases all the bullshit out of my life. Who is my biggest fan and staunchest defender. Who is always there for me no matter what.

And – who I feel exactly the same way about. Amy – you are awesome. Thank you for being you. And for putting up with me.


With yesterday’s announcement that early-stage VC Greycroft has raised a $200 million growth fund, this type of fund has officially become a trend. But before we dig into the dynamics of it, let’s pay homage to the originator of this concept, Union Square Ventures.

In January 2011, USV raised what I believe was the first “opportunity fund.” Prior to this, plenty of VC firms invested across the early stage to late stage spectrum from the same fund (e.g. Battery, General Catalyst, Sequoia, Greylock, Bessemer). Others had separate early stage funds and late stage funds, often with separate teams and economics (e.g. Redpoint, DFJ, North Bridge) typically aimed at different opportunities. But the USV Opportunity Fund was the first time, at least in the post 2001-Internet bubble cycle (or last decade, if you want to put it that way) where an early stage firm created a separate fund to invest in late stage rounds of their existing early-stage portfolio companies. In USV’s case, Fred Wilson explains the strategy extremely clearly in the post The Opportunity Fund.

Greycroft is the latest firm to raise this type of fund. In the last week I’ve talked to two other early stage VC firms who are raising similar opportunity funds. In one case they referred to it as a growth fund. In the other case they referred to it as an opportunity fund.

In the fall of 2013, we raised a similar type of fund called Foundry Group Select. It was a $225 million fund, just like our other three $225 million funds raised in 2007, 2010, and 2013. But we called it “Select” instead of “Growth” or “Opportunity” for a specific reason – we only use it to invest in existing portfolio companies of ours.

USV has done a magnificent job of investing in later stage rounds of their existing portfolio companies as well as later stage rounds of companies that fit tightly within their investment thesis. We decided to drop the second half of that strategy as we didn’t want to spend time being late stage investors. It’s not natural for us as an entry point and we didn’t want to add anyone to our team since keeping our team size exactly the same is a deeply held belief of ours.

The decision to raise this fund came out of a combination of desire and frustration. We have a well-defined fund strategy, based on a constant size of each of our funds. Our goal is to make about 30 investments in each fund (2007 has 28, 2010 had 31) that range between $5m and $15m over the life of the company. Part of this strategy is that we are syndication agnostic – we are happy to go it alone through two or three rounds of a company if we have conviction about what they are doing. We are equally happy to syndicate with one or two other VC firms. Either way, while we focus on being capital efficient (we’d rather not overfund the companies we are involved in early), we are interested in buying as much ownership as we can at the early stages.

As a result, when a company begins to accelerate dramatically, we weren’t in a position to contribute meaningfully to the later stage rounds since we’d likely already have something in the $10m to $15m range invested. That’s the desire part of the equation – we knew we could make money off a later stage investment, but when we were talking about investing an incremental $1m or $2m it didn’t really matter much.

The frustration part was more vexing to us. In a number of our successful companies, we saw a long line of financial investors lining up to follow. None of them would engage as a lead, but all want to participate when a round came together. If a company was raising $30m, we’d have $50m+ of “followers” waiting to take whatever was left. We didn’t find that particularly helpful.

So we raised Foundry Group Select. We explicitly limited it to only companies we were already investors in and on the boards of. As a result, it is literally zero incremental work for us since we are already deeply involved in the companies we are investing in. This led us to an interesting decision – since we recycle 100% of our management fee, why would we charge a management fee on this fund if we are doing no incremental work? The conclusion was easy – we don’t charge a management fee. We only make money when the investments make money, resulting in very tight alignment with our LPs.

To date, we’ve invested from Foundry Group Select in Fitbit, Sympoz, Return Path, Gnip (acquired by Twitter), and Orbotix. It’s been a powerful addition to our strategy without creating any extra overhead on us.

I’ll end where I started – by paying homage to our friends at Union Square Ventures. They’ve led the way on many elements of early-stage investing post-Internet bubble, dating back to 2004 when Fred and Brad raised the first USV fund. As the “opportunity fund” becomes a trend, they’ve once again created something that, in hindsight, looks brilliant.


Recently, I wrote a post titled After Your First Big Success, What’s Next? The comment thread was powerful and fascinating, as was the direct email feedback I got, including the following note:

“I think it would be interesting to hear your perspective on how an entrepreneur should approach “what’s next” after coming off a failed business. How should one manage their own emotions and their own perspectives post failure? It’s easy to play the blame game and it’s easy to be extremely hard on ourselves. There has to be constructive ways to move forward rather than destructive ways that could lead to lack of confidence, or depression.”

Having failed at a lot of things, I’m completely comfortable tackling this. But let me establish my bonafides first. My first company, Martingale Software, failed (we returned $7,000 of the $10,000 we raised.) My second company, DataVision Technologies failed. I didn’t have success until my third company, Feld Technologies. While my first angel investment was a success, I resigned as the chairman after the VCs came in and left the board after the CEO was replaced. In the late 1990s, what looked like my biggest success at the time, went public, peaked at an almost $3 billion market cap, and then went bankrupt three years after the IPO. And the second VC fund I was part of, which raised $660 million in 1999, was a complete disaster.

As the cliche goes, I learned a lot from these failures.

I’ve had many more. I remember firing my first employee, which I viewed as a failure on my part, not hers. I remember the first CEO I fired and staying up all night prior to doing it because I was so nervous and miserable about the decision I’d made to back him. I remember the first company I funded as a VC that failed and struggling to figure out how to shut it down after everyone else fled from the scene. I remember the first time someone threatened to sue me for doing a bad job for them (they didn’t.) I remember the first time I was sued for something I didn’t do (I eventually won.) I can keep going, but you get the idea.

What’s next is simple. It’s whatever you do next. In some cases this will be easy – you’ll already be on to the next thing before the previous thing you were working on failed. In many cases it won’t be easy – you’ll be wallowing in the quicksand of the failure well after the other bodies have been sucked below the surface.

How you deal with your own emotions, and perspectives, is an entirely different matter.

I love the approach of Jeremy Bloom, the CEO of Integrate (we are investors) who I have immense respect and adoration for. In 2006 at the Winter Olympics, he was the best freestyle mogul skier in the world. On his last run, he was expected to take gold. Halfway down he missed a turn and placed sixth. As Jeremy told me, he gave himself 24 hours to be angry, depressed, upset, furious, frustrated, confused, and despondent. I imagine him in his room in the Olympic Village systematically destroying all the furniture. One minute after 24 hours, he was on to the next thing, with the failure solidly in his rear view mirror.

Now, 24 hours is a short amount of time. I’ve often carried my failures around for longer, but never much longer than a couple of days. I separate how I feel from failure from how I feel about life and what I’m doing. Interestingly, for me, failure isn’t the thing that gets me depressed, it’s boredom combined with exhaustion. But that took me a long time to figure out.

I’ve found that talking to people about my failures is helpful. Rather than hold them inside, I talk to Amy (my beloved) about them. I talk to my partners about them. I talk to my close friends about them. I don’t ignore the failure or try to bottle it up somewhere. Rather, I set it free, as quickly as I can.

In our book Do More Faster, we have a chapter on the the wonderful story of the failure of EventVue. After it failed, some of Rob and Josh’s friends from the Boulder Startup Community had a wake for EventVue. We celebrated its life, buried it, and moved on. I loved this idea and have done it a few other times for failed companies. It’s important to remember that even in death you can celebrate the wonderful things that happened during life.

But ultimately, you have to know yourself. There is no right answer or magic salve for getting past failure. If you are going to be an entrepreneur, you are going to experience it a lot. It’s just part of the gig. Start by understanding that, and asking yourself what you are really afraid of. And, after you fail at something, let yourself experience whatever you want to experience, remembering that it’s just another small part of the journey through life. And then go on to whatever is next, in whatever time you are ready for it.


The Martian by Andy Weir is the best book I’ve read in a while. I consumed it in the last 24 hours. But first, here’s what I woke up to this morning.

 

No – I’m not on Mars. But Mark Watney was. And while Mars is a lot more desolate than Homer, Alaska, I disconnected from the human race several times right in the middle of a work week because of the amazingness of this book. At 2am last night, I said out loud to my wife Amy, who was fast asleep, “I’m going to be tired tomorrow afternoon.” And, as I crawled into bed after a stretch of 7am to 2pm video conferences, I said “Wow, I’m tired, but I’m not nearly as fucked as Mark Watney is right now.”

The story is a simple one. A mission on Mars goes badly in the sixth day of 31, the six person crew aborts quickly, but during the abort, one person (Mark) gets separated, is lost, and left for dead. Except he’s not. After he regains consciousness, he realizes he’s been abandoned on Mars. The good news is that all the stuff from their mission, including what will become the very famous HAB, two Rovers, and all their supplies and equipment, is still there. The bad news is that Mark is alone on Mars with no communication back to Earth since all the comm gear was in the spacecraft that was used for the abort.

Day by day, piece by piece, hack by hack, Mark survives. His brain is amazing – he’s a classical botany / electrician / engineer hacker. Well – I guess there’s no such thing, but that’s the fun of it. He’s awesomely descriptive, has a wicked sense of humor, and incredible survival instinct. And his creativity, in the endless near-death experiences he finds himself in, is awe-inspiring.

NASA and the people of Earth eventually figure out he’s alive. He figures out how to communicate with them. As he continues to extend his life expectancy, a plan to rescue him comes together. It blows up on the launch pad. Another plan emerges. Communication is lost. A series of parallel epic journeys begin. Tension, already high, mounts. And Mark continues to almost die, but then figure out a way not to.

What a wonderful book. I can only imagine how badly Mark smelled at the end of it.


Nope – Amy and I aren’t moving to Homer. While we have a home in Homer, where we will be for the next three weeks, we still call Boulder, Colorado our home. But we came very close to moving to Homer in 1995.

We were living in Boston at the time. I’d sold my first company, Feld Technologies, in 1993. By the end of 1994 I had a staff job, reporting to the co-chairmen of AmeriData where I travelled all over the US helping with acquisitions and generally causing trouble. At some point Amy and I realized we could live anywhere and we knew that Boston wasn’t home. During one of the long conversations we had at the time about our future, we started talking about calling it quits and moving to Homer, Alaska.

Amy grew up until she was eight years old in a town called Anchor Point, 20 miles north of Homer. If Anchor Point rings a bell to you, it’s because it’s the name of our foundation (the Anchor Point Foundation) and we’ve done some really fun things with it such as the Anchor Point Fellows Program at Wellesley College.

We did the math and realized we had enough money to live in Homer for the next 30 years if I made no more money. I wasn’t worried about that since I knew I could make at least $100,000 a year just consulting, even from a distance, so the conversation was about how we wanted to live the rest of our life.

At 29 years old I thought very hard about whether or not I was done. After selling my first company, I’d invested as an angel investor in a bunch of companies, was a non-executive Chairman / co-founder of a few, and had lots of ideas for new things to do. But I had also recently come out of a very deep depression and was very open to changing things in my life pretty dramatically.

Ultimately, we decided to move to Boulder, Colorado. We didn’t know anyone there and I didn’t have any business there, but it was a lot more centrally located in the US than Homer, Alaska. I figured we’d make a life in a beautiful place, but I wouldn’t have to drop out of what I was doing since the bay area was a two hour plane flight and the east coast was a four hour plane flight. We moved to Boulder in November 1995 and never looked back – it’s been amazing.

After moving to Boulder, we continued to spend a few weeks in Alaska each summer. The two week trips turned into three week trips and we ultimately bought a house in Homer in 2002. We spent between four and six weeks a year there in the summer until 2010, but haven’t been there in the past three years.

It feels like coming home to be back in Alaska. Landing in Anchorage was natural. Renting a car and driving to the Sheraton to spend the night felt totally normal. The low hanging cloudy gloom and light all through the night is just as we remember it. Things feel a lot slower here, which is both good and bad.

Our weekend in Anchorage is with a bunch of friends, including celebrating our close friends Jon and Doug’s recent marriage and  spending time with Amy’s sister, her partner, and niece. And just hanging out as we get ready to head to Homer on Monday.

I’ll be working as normal for the next three weeks, just remotely from Homer. I hope to finish the final draft of my next book, Startup Opportunities (co-authored with Sean Wise), while I’m up here. And I’m going to read a lot since we don’t have a TV.

I’m glad I didn’t drop out at 29 and move to Homer – it was way too early in my life for that. But I’m equally glad we bought a house here in 2002 and have made Homer, and Alaska, part of where we live and spend our time.


Fred Wilson beat me to it this morning with his post A Big Win For The Patent Reform Movement but he’s got a couple of hour time zone advantage over me. Regardless, I love Fred’s punch line:

So it was with incredible joy that I read these words by Elon Musk, founder and CEO of Tesla Motors and possibly the most innovative entrepreneur in the world right now. [Elon wrote in his post All Our Patent Are Belong To You] “Yesterday, there was a wall of Tesla patents in the lobby of our Palo Alto headquarters. That is no longer the case. They have been removed, in the spirit of the open source movement, for the advancement of electric vehicle technology.”

I’ll pile on with my accolades to Elon. While I don’t know him, I’m long time friends with his brother Kimbal who lives in Boulder so I always feel like I get a little taste of Elon whenever I talk to Kimbal. So – Elon – thank you for being a real leader here and taking action.

I’ve been asserting for a number of years that while software patents are completely fucked up, the general patent system stifles innovation. More and more research is appearing on software patent issues and patent trolls in general, including this recent piece by Catherine Tucker, an MIT Sloan professor of Marketing, titled The Effect of Patent Litigation and Patent Assertion Entities on Entrepreneurial Activity. As Ars Technica summarizes in New study suggests patent trolls really are killing startups:

Turns out there is a very real, and very negative, correlation between patent troll lawsuits and the venture capital funding that startups rely on. A just-released study by Catherine Tucker, a professor of marketing at MIT’s Sloan School of Business, finds that over the last five years, VC investment “would have likely been $21.772 billion higher… but for litigation brought by frequent litigators.”

As my lawyer friends tell me, “the Supremes” are finally making some calls on this. The induced infringement theory, a particularly obnoxious patent litigation approach, is no longer valid. The main event, Alice Corp. v. CLS Bank, is still waiting to be ruled on. Let’s hope the Supremes take a real stand on when software claims are too abstract to be patented this time around, unlike the punt they made on Bilski.


Recently I had  a full day of meetings with chaotic juxtapositions of people.

In one meeting, the person I interacted with was awesome. He owned everything that was going on in his company – good and bad. He was clear minded. He knew what was working, what wasn’t working, and what he needed to change. And he took responsibility for it.

Immediately after, I had a non-scheduled conference call to try to get something wrapped up. It was a total waste of 15 minutes of time where the person on the other end simply refused to take responsibility for something that should have been easy for them to take responsibility for. After 15 minutes of back and forth, it was clear that the other person had no interest in taking responsibility for something I thought he should. And he couldn’t make the case for why, other than “because I don’t want to.”

I eventually gave up.

I then switched to a call with a CEO who was exploring something new. She asked a series of clear and direct questions, knowing that it was her responsibility to make a decision about what to do. It was easy to be on the receiving end of a series of challenging questions as she tried to get as much data as she could out of me as she formulated her point of view. Whatever decision she makes will be fine with me – it’ll be a thoughtful one that she owns.

After a long day, I came home to an inbox with 200 emails in it. I spend two hours grinding through them. As I was reading, responding, and archiving, I started noticing that many of the strong CEOs I work with owned whatever was going on at their company. There was simplicity in this – no blame, no excuses, no justification. They just took ownership.

While there were lots of other emails where the person owned whatever was going on, there were many situations where this wasn’t the case. This was especially true with a few entrepreneurs struggling to raise money, or asking questions about situations they had gotten themselves into, such as a poor allocation of equity to co-founders, where a co-founder had left, but there hadn’t been any vesting. While more obvious in situations where things weren’t working, this was also true in situations where there was ambiguity around what was going on.

When I step back and ponder this, the CEOs I respect the most are the ones who take responsibility for the actions of their company. Good or bad, successful or not, they don’t shirk any responsibility, blame anyone, or try to make excuses. They just own things, and if they need to be fixed, they fix them.

What kind of CEO are you?