Manu invested in Torbit and is on our board. He's been great. One of the things I've grown to appreciate is that he wants founders to continue to lead the company. With Manu you don't have to worry about being replaced with adult supervision. That's not true with all VC's.
I like all of the criteria laid out for portfolio investments, save #5: The entire team should be located in the SF Bay Area. I'm seeing this requirement more and more often among venture firms. Clearly K9 Ventures has had success with their investments, so they are free to allocate their money as they choose.
I have nothing against the Bay Area. I went to school here, live here, and started my company here. However, if I want to start another venture down the road I feel like I'd have no choice but to start it here. And not having choice only hurts the entrepreneur.
Those are his criteria, not yours. He lives in the Bay Area and wants to be close to all the companies he invests in. As an entrepreneur, you'd have to start a company here if you'd like Manu to invest in you. If you want to start it someplace else, then he may not be the right investor for you. It's that simple.
What I like about Manu's criteria is that they are very clearly laid out. Not all investors make it so easy to know what they expect out of companies, so they end up wasting a founder's time.
Disclosure: I've known Manu since the late 90s, and he invested in my company (IndexTank).
I definitely appreciate how clearly everything is laid out. Some VCs have ridiculously wishy-washy copy on their website. If I had a nickel every time I read about "investing in big ideas" I'd have a $1M seed round in no time.
Well said Diego. I think it's a testament to Manu's desire to be hands-on and actively involved in every company he backs. He wants to add value to everything he is involved with, and the best way he can do this is by being close to the companies he invests in.
I think one of the reasons they do this is because a last resort for local startups is to sell out in an acqihire to one of the large tech companies in the area, who are always looking to acquire local developer talent.
You don't have that asset to sell if your team are spread out across the world, or are located somewhere else.
Investors are gamblers, and gamblers look for good odds. Until we can prove that the odds of success in the Bay Area are not better than other places, we'll have to often deal with required local operation.
Lots of folks who aren't already wealthy would prefer living elsewhere (unless you like places with Manhattan-style prices, but no Manhattan-style amenities).
That's not really the right question -- it's more about the investment opportunities inside and outside the Bay Area. In SFBA, there are so many startups that if you're a median investor you are investing in perhaps the 1000th best opportunity in the area. If you are willing to invest in a place with fewer investors, you may be investing in the 1st-5th best opportunities in say, Jacksonville FL. However, that assumes that it's possible to rank order these a priori, and more importantly, that you can serve your portfolio companies as effectively when remote (you can't).
I think there are other places that can be equal. I would think that includes Boston, New York, Boulder, and maybe a few others. They key is a support network of entrepreneurs and potential employees with an interest in/experience in startups.
On the other hand, starting your business in a random town probably won't have great odds.
Awesome. I remember discussing Rapportive with Manu back when we started and although we didn't end up working together (maybe he didn't want too many companies that would sell to LinkedIn :p ?), the quality of his insights was off the charts.
Agreed, this is great news. It was the same for us at MobileWorks: he was one of the first investors we spoke with during this process, and his advice was terrific – it led us to where we are today.
On first glance, I assumed "K9 Ventures" was going to be Kickstarter's new micro-VC fund that invested in their own users' projects. Then I counted the letters and realized the "Kickstarter" would be "K10" or "K9R". <:)
Manu invested in card.io and is absolutely fantastic. He is extremely tactical, constantly pushed us to focus on the numbers that matter, and most importantly, provided gobs of awesome counsel. He should be your first call if you're looking to raise money.
I love this thread: it's populated either by founders of Manu's portfolio companies, or entrepreneurs who pitched him and got valuable advice instead. I fall into both categories: the former in my current company, the latter in my previous one.
I think anyone who knows Manu can attest that a great investor provides so much more than money. In fact, this is part of his investment thesis, and, in my opinion, helps to explain why his first fund was such a success.
So if you're raising your seed round and you haven't talked with Manu, you should be asking yourself: why?
Manu and I started the PhD program the same year at Stanford and it's been my privilege to know him. He's consistently constructive and intelligent and I'd encourage anyone who is thinking about starting a business meeting his criteria to talk to K9.
At an event I had the chance to talk to Manu and quickly came to the same conclusion as many posts say, he is a great guy. Good to see the micro fund happening and I expect many more great and interesting investments. Someone to follow.
