Posts Tagged: consumer internet

Announcing Version One Ventures

I am excited to announce today the launch of Version One Ventures, a new $15 million micro-VC fund. Version One will back outstanding web and mobile entrepreneurs across North-America with $250,000 to $500,000 investments in Seed and Series A rounds.

The fund builds on my successes with over 35 angel investments which include six exits – among them acquisitions by Google, Twitter, Salesforce, and Groupon. My simple investment thesis: back passionate entrepreneurs who are trying to solve a big problem with a strong product vision.

Version One came to life in the same way that most start-ups evolve. I bootstrapped my first angel investing projects with my own funds, found product-market fit and in the past 2 years have gotten significant traction with exits and follow-on rounds for portfolio companies (most recently for social publisher Wattpad, crowdfunding platform Indiegogo and educational network Edmodo).

With the Internet rapidly moving into everybody’s hands, today’s entrepreneurs will be in the position to build the companies we all dreamt of in 1999 when I started my own start-up JustBooks.The timing was therefore right to take my “angel investing project” to the next level and create a larger fund with a big vision: to become one of the most respected early-stage funds in North-America by being a trusted and helpful partner for entrepreneurs.

As a former entrepreneur myself, I feel the most rewarding aspect of being an investor is to help other entrepreneurs start, build and scale companies and to pass on some of the lessons I learned the hard way over 8 start-up years. Helping others to achieve greatness is what venture capital is all about and how I see my role.

I am fortunate to have found outstanding investors who share this vision. Led by Jeff Mallett (the former President and COO of Yahoo), Version One Ventures is backed by over a dozen successful American and Canadian Internet entrepreneurs as well as a number of high-net worth individuals.

Version One’s typical investment will be $250K to $500K in Seed and Series A financing rounds in consumer Internet, e-commerce, SaaS and mobile companies. To date Version One has already made 5 investments: Top Hat Monocle (interactive learning platform), Julep (multi-channel beauty brand), Jobber (business management software for contractors), Instacanv.as (Instagram artist marketplace) and Sunnytrail (social intelligence platform).

I am very grateful to a number of people who have helped me grow as an investor, especially Albert Wenger and Fred Wilson from Union Square Ventures, Jeff Clavier from SoftechChris Fralic from First Round Capital and Christoph Braun from Acton Capital. Thank you for your support and mentorship.

Version One is open for business – stay tuned (@versiononevc)!

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What are your predictions for 2011? Here are my top 4.

I didn’t do too badly predicting what would happen in the consumer Internet space in 2010 so I am giving it another try for 2011:

  • Android will become the most important mobile platform to develop for – the iPhone platform will be number 2, the rest (RIM, Windows Phone) will only play a marginal role. While Android has clearly been gaining market share on the iPhone in the past months, most developers still consider iOS the most important platform – this perception will change in 2011.
  • Mobile apps will start impacting offline purchasing decision in a significant way. 2010 has seen the launch of many mobile shopping app like Shopkick or Barcode Hero (a W Media portfolio company) but 2011 will be the break-through year for “local, mobile commerce”.
  • Early-stage financing will continue to be close to a bubble as there is simply too much money chasing too few deals. So if you run a start-up, think about raising that next round of financing rather earlier than later. (On a side note: the Canadian market is clearly not as hot as the US market).
  • IPO and M&A markets will finally open up. It has been long time since we have seen a major IPO in the web space and a hot M&A market – I thought that this would already happen in 2010 but hey, 2011 is good enough!

I originally wanted to come up with 5 predictions but had a hard time finding as many without either completely speculating or stating the obvious – so what do you think will happen in 2011?

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My investment thesis

Fred Wilson’s blog post on Dave McClure’s investment thesis a few weeks ago reminded me that I needed to do a better job on spelling out my own. I had done some preliminary work when I started W Media Ventures almost 3 years ago but it was very high-level only addressing the sector (consumer Internet), the investment size ($50K-$250K) and the geography (Pacific Northwest / Western Canada). As I have learned a thing or two since then, I now have a much better understanding what kind of entrepreneurs and ideas I want to invest into. So here is what I am looking for:

  • Early-stage consumer internet / SaaS companies located in the Pacific Northwest / Western Canada. Geography is a must for leading a deal but I do co-investments outside of that area.
  • Large addressable and capital efficient market: company addresses a large market (hundreds of $ millions +) and does not require more than $1-$3 million in funding to become a $25-$50 million (exit value) company
  • Strong founder team with a visionary and passionate (yet coachable) CEO at the helm. Team must include at least one technical person who can actually build stuff.
  • Differentiated product: no “me too’s” and strong technical focus
  • Easy-to-understand business model that does not depend on scale and can generate revenues within 9-12 months from launch
  • Initial traction with – at the minimum – an existing prototype/alpha version that is currently being challenged by users

In reality, no investor will ever only make deals that fit 100% with their investment thesis but it is important to have a consistent set of criteria against which investment opportunities can be benchmarked against. So here is mine, looking forward to feed-back!

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What GROW means for the Vancouver tech community

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For the next 3 days the Valley descends on Vancouver for the GROW conference and you can feel a real excitement in the local tech community about hosting entrepreneurs like Tony Hsieh (Zappos) or Andrew Mason (Groupon) as well as investors like Rob Hayes (First Round Capital), Dave McClure (500 Startups), Jeff Clavier (Softtech) or Chris Albinson (Panorama Capital) here in town. Building a company outside of the hot spots of the Valley or NYC is sometimes a tough undertaking despite many success stories – entrepreneurs don’t have the same easy access to experienced talent, mentors or investors and have fewer opportunities to learn from peers. So having close to a hundred top notch tech entrepreneurs and investors coming into town gives the Vancouver tech community a real boost and will provide some fantastic learning and networking opportunities for entrepreneurs from here and the rest of Canada.

Big thanks to Debbie Landa from Dealmaker Media for organizing the event, really hope this will turn into an annual conference!

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Wanted: Entrepreneur-in-Residence for 2010

Vancouver-based W Media Ventures is one of the premier early-stage Consumer Internet investors in the Pacific Northwest and is looking for an Entrepreneur-in-Residence (EiR) for (all or parts of) 2010. If you are an individual with an outstanding entrepreneurial spirit and mind, who is looking to create the next best thing in consumer internet, would like to assist in the evaluation of potential investments and provide functional expertise to existing portfiolio companies, we would love to hear from you. You need to have a successful track record as entrepreneur or CEO / CTO in a start-up environment, ideally in the Consumer Internet area. Interested? Please apply to info [at]wmediaventures [dot] com.