Seattle VC Profile: Andrew Dumont, Curious Capital

July 28, 2021

When I started Ascend in 2019, I realized even though I was o-l-d OLD, I had more in common with the folks in town who were earlier in their professional investing journeys than the venerable VC’s I’d pitched as a founder. I admire and respect the new wave of Seattle/Pacific Northwest venture capitalists, and thought it would be fun to profile some of our region’s up and coming VC talents in these pages. —KW

Andrew Dumont helped inspire me to launch Ascend. He’s a next-level operator, a founder-first investor at Curious Capital, and a no-BS wise counsel to many of us in the Seattle venture capital ecosystem. He’s the kind of friend you want in your corner, whether you’re a startup founder or a VC.

What made you decide to be a professional investor?

The main thing that made me want to become an investor and start Curious was my move back home (I grew up in Bellingham) to Seattle, after a stint in New York. At the time, I was dealing with some family health issues and had just finished the acquisition of Bitly after a bit of a slog, and was ready to spend as much time as possible helping and supporting local entrepreneurs. I have always felt like Seattle's seed/pre-seed ecosystem was lacking. Investing is a great vehicle to do that.

I have been around VC my entire career, both in growing venture funded companies and while at betaworks (one of the first venture studios, which also frequently did seed investments). I certainly don’t think of myself as a professional investor, though. At this stage of my career, I’d much rather be building companies, so investing has become a part-time activity for me. This also allows me to add real value as an investor by still very much being in the game as an operator.

What are your most successful investments so far?

Fund I has performed exceptionally well, far better than I thought it could honestly. Of the 18 companies I've invested in, 6 of them have been acquired, with 4 of those going to publicly traded companies. Some standouts in that group of companies were Streem (in Portland) that was acquired by Frontdoor, Timber (in New York) that was acquired by Datadog, and Vendorhawk (in Seattle) that was acquired by Servicenow.

But honestly, I don’t take any credit for these outcomes and am a firm believer that the ones that should be celebrated in successful outcomes are the entrepreneurs that build them. Seed and pre-seed investing is very much a gamble and there's a lot of luck involved. No exception here.

Why should founders want you on their cap table?

I have deep operational expertise in customer acquisition and growth. It’s somewhat of a rare skillset and something I've found to be a pain point for almost every early stage company. Both in terms of strategy of GTM and making the key growth hires. I offer this up to every company I invest in and am there to help every step of the way with it.

How many new pitches do you take per month?

The first few years of working on Curious, I was a lot more active and having anywhere from 20-30 conversations with entrepreneurs each month. I really don’t like the frame of most VC pitches, though, so I generally tell the entrepreneur to put away the deck and just talk me through their business, the challenges they see, and how I can help them. I generally decide whether or not to invest after that discussion.

How many new investments do you make per year?

Previously, it was 5-10 per year. I’ve since pulled that back to 1-5 per year. My intention in the short term is not to raise another fund, so I'm slowing down pace and mixing in more personal investments.

What’s your sweet spot in terms of check size, valuation and vertical?

My check size is anywhere from $25K-$100K. I generally don’t care about valuation at the stage I invest, which is typically pre-seed. On vertical, I’m willing to invest in anything as long as I can get passionate about the problem and team.

What one company do you want to hype for us here?

Tough to only pick one, but I’m a huge fan of Aaron and the team at Blokable. They’re tackling the massive problem of affordable housing. This is my only hardware investment and has been incredible to watch them go from a single Blok unit to a full-scale production.

What do you think the next ten years will look like for Seattle startups?

There’s better spokespeople for Seattle than me, but generally I think the future of Seattle is very bright from a talent perspective. There are great technologists moving here every day and more and more focus being put on the most strained spot of the ecosystem historically, which was access to capital for early stage founders. I’m optimistic.

What song is currently getting the most run on your Spotify?

I tend to rotate between Frank Ocean, Nils Frahm and Sza. Song… I’d say Fundamental Values by Nils Frahm.

Favorite cooking ingredient?

Malden Sea Salt and Partanna Olive Oil, can’t cook without them.

Anything else to say?

That’s all I’ve got. :)

Ascend Venture Capital LP Profile: Justin Moon, Partner, Perkins Coie #openlp

July 7, 2021

When I was a founder, I had no idea what a Limited Partner in a venture capital fund was. Now that I run my own fund, I want to bring transparency to founders and let them know where our money comes from. Our LP’s are an incredible group of individuals who often advise our founders and myself as we strive to create the next generation of world-changing startups (and funds!). -KW

Justin is one of my closest friends. He’s co-chair of Perkins Coie’s Technology Transactions & Privacy practice, and has worked pro bono for the Northwest Immigrant Rights Project since 2008. He’s a remarkably empathetic, pragmatic, and skilled attorney - a rare triple threat with an impressive deal-making track record. I’m honored to have him as an LP in Ascend, and stoked he took the time to share his wisdom here.

We met in law school - you clearly had a better head (and heart) for it than I did! 20 years later, you've worked on dozens of big M&A transactions in the technology space for a top Seattle firm. What would you tell founders they should keep in mind while growing their startup, that will best set them up for a successful exit?

With respect to law school, perhaps you just executed on your exit strategy a few decades before me. You’re always ahead of the curve, Kirby. From a business perspective, our deal lawyers would say build a fast-growing, independent company that solves a significant customer problem in a large market, and you will have your choice of when/how to exit. As my partner Lee Schindler says, “the exit is an output, not an input.”

It also sounds a little trite, but in the tech M&A space, a target’s most valuable assets are its IP (and I would include data in IP) and its people. Founders are working with limited resources and need to be super strategic around how to allocate those assets. From a legal perspective, you should allocate those assets to ensuring that your company’s processes and policies (including its use of open source software) around its IP development and protection are tight. The upfront costs pale in comparison to what it might cost you down the line to clean up any gaps. From a people perspective, we’re in seller’s market, especially post-pandemic, so the ability to attract, develop and retain top talent is and will continue to be a key differentiator. Nice exits are driven by a buyer’s interest in the target’s IP or its people. Great exits are driven by a buyer’s interest in the targets IP and its people. Do both and do them well.

From the buy-side perspective, what are the top three drivers of valuation and motivation to close a deal? What does a startup need to do to help the deal sponsor get over the finish line?

In terms of motivation, the key driver is the target’s ability to solve a problem, either for the buyer or end users. Are the target’s products and services solving a problem for the user and doing it a way that aligns with the buyer’s view of how to solve the same problem? The buyer is typically looking to expand an existing line of business (where it is more efficient to do so through acquisition) or looking to expand into a new line of business that’s complimentary to an existing line of business.

In terms of valuation, my comment above re IP and talent apply here as well, and Lee also weighed in with the following three key valuation drivers:

1. Value – Do something for customers that no other company can do as well.

2. Opportunity – Demonstrate growth and future opportunity to avoid valuations based on current metrics.

3. Feasibility – Help the buyer understand how the startup’s business, technology and team can integrate with buyer and make the whole greater than the parts.

What's the most common deal killer in an acquisition scenario?

From a business perspective, lack of scalability. The solution a target offers to customers needs to be able to scale (from a legal and technical perspective) in the hands of an acquirer. Shortcuts that work for startups often don’t work for acquirers.

From a legal perspective, and this goes back to my first response above, IP issues are quick killers. This can show up as issues with ownership or use rights, privacy and security vulnerabilities, or a lack of elegance or sophistication in the target’s tech.

From a talent perspective, there needs to be some substance behind the style. Buyers want to add talent, not just tech.

Switching it up, you toured with Alice in Chains before you made the move to lawyering. What's your best grunge era road story?

Ha. “Toured” with Alice in Chains might be generous, but road stories stay on the road (or something like that). I’ll give you an AiC story, though, since you asked. In 1990, I was a seventeen-year-old senior in high school. AiC had just released Facelift. One of my best friends at the time got kicked out of school and with his newfound freedom, he basically became a male groupie and somehow managed to ingratiate himself into the local rock scene.

Through all of that, we met a woman named Demri Parrott. If you’ve seen Almost Famous, she was our own Miss Penny Lane, and she also happened to be the girlfriend of Layne Staley, the lead singer for AiC. Demri epitomized everything that was cool in the Seattle rock scene; her taste in music was impeccable, she was a great artist and she had this infectious smile and personality that attracted people to her. She was a firefly. She was also older and cooler than us, but for whatever reason, she seemed to have a soft spot in her heart for our little crew of rock boys. As a result, we ended up spending a bit of time at the apartment she shared with Layne; so much time that her couch quickly turned into a crash bed for one of my friends who decided that it was more to stay with Demri and Layne than it was to go home to Mom and Dad.

So, after another late night at their garden apartment near the old Lobo Inn, I headed home in my Volkswagen Van (nicknamed the “Shame Train” by Cole from Sweet Water) and just before I leave, my couch crashing buddy asks me to come back in the morning to pick him for school. A few short hours later, I’m back at Demri’s apartment to pick him up. I push the buzzer button next to her name. Nothing. I push it again. Nothing. Hmm. Figuring they all must be passed out and without giving it much thought, I reach into my wallet for my bank card and just like you’ve seen in the movies and on TV a hundred times, I pull out my card and begin to slide it into the door slot. To my utter shock and disbelief, the door opens. A short flight of stairs later, I’m at her apartment door. I knock. Nothing. Another knock. Nothing. Without thinking twice, I pull out my card again and of course, it works again. Now I’m inside and the glamour of the night before has faded. Shades half drawn, my buddy is face down on the couch, fully clothed and snoring. Half empty beers and cigarette butts stubbed into ashtrays clutter the coffee table beside him. We’re running late now, so I shake him and tell him we need to go. Now. As we shuffle out, I steal a quick glance past the open bedroom door and see Demri and Layne sleeping peacefully. 15 minutes later, me and my buddy are sitting in English class, daydreaming of the night before and the adventures that lie ahead.

What song is currently getting the most run on your Apple/Sonos/Spotify?

Maybe I’m showing my age here a bit, I still think of music in terms of albums, rather than songs. My musical tastes are also a little all over the map, but what I’m listening to ant any point in time tends to track my mood. So, during the pandemic, which for me (like a lot of people) was a bit of a more reflective time, I was digging stuff that feeds my mind in a more thoughtful and introspective way. For me, that’s Stevie Wonder’s Songs in the Key of Life, Curtis Mayfield’s Curtis and Marvin Gaye’s What’s Going On. At this point I think we almost take it for granted, but What’s Going On is just a masterpiece, especially when considered in light of era in which it was created and the push back that Marvin got for making that record from Berry Gordy.

As we emerge from the pandemic and head into an open summer, what I’m playing is shifting to stuff that wants to be blared from an outdoor speaker or car stereo. For me, that’s New York hip hop from artists like A Tribe Called Quest, De La Soul and Biggie. And it’s 70s rock from Led Zeppelin and the Who, early 90s-era stuff from Soundgarden and Spoon, and early Strokes.

Favorite shoes?

Current: Adidas Stan Smith Prime Blue. All time: Nike Air Max and Jordan 3s.

Favorite cooking ingredient?

Meat: grass-fed beef from Crowd Cow. Vegetables: riced cauliflower.

Anything else?

You mentioned law school as our first date, but before we met, we were also both attended small, liberal arts schools back east where we studied writing and literature. Finding time to write is hard, but I always find time to read. My two favorite reads from last year were Jonathan Lethem’s Fortress of Solitude, (thanks again for the recommendation!) and Adam Grant’s Think Again. I would highly recommend Fortress as a beach summer read - great coming of age story. Think Again should be a must read for your founders. It’s full of insightful information and guidance that has broad application across industries and disciplines.

Seattle VC Profile: Martina Welkhoff, WXR Fund

June 30, 2021

Martina Welkhoff has probably forgotten more about VR/XR startups than most of us will ever know. In a category that’s been notoriously tough to crack, she has built a company, a studio, and now has just announced (along with partner Amy Lameyer) her $5M WXR Fund, focused on investing in women-led companies in this especially male-heavy industry. I learn something every time we interact, and I’m stoked she shared her wisdom here.

What made you decide to be a professional investor?

I often say I'm still an entrepreneur at heart, but what ultimately convinced me to go from founder to funder was the time-limited opportunity I saw to invest in women-led companies as the foundation for XR is being established. As we move from 2D to 3D computing, there's exciting opportunities to do things differently, not just in terms of the user experience, but in the way we fund companies and build out an inclusive ecosystem. Women-led and gender diverse teams have been shown to produce stronger financial outcomes, yet are still woefully underfunded, so there's huge potential economic upside as well.

What did you do before becoming an investor and how does that benefit your founders?

I co-founded a mobile gaming company called Zealyst, which I ran for six years. I then founded a VR studio called ConveneVR where we were experimenting with social XR. The main way my entrepreneurial experience benefits our portfolio companies is the empathy I have for their journey and the many challenges they face along the way.

What are your most successful investments so far?

Obsess is an immersive shopping platform that went through our accelerator in 2018 and we invested in 2020. Their growth has been astounding, and they are now working with brands like Ralph Lauren, Coach, Dior, and many notable others. The founder & CEO, Neha Singh, was the first technical product hire at Vogue and brings a unique blend of technical and market expertise that perfectly positioned her to execute on her vision to transform ecommerce.

Why should founders want you on their cap table?

We bring XR expertise and an extensive network in the space, and we love to roll up our sleeves to help our founders (without micromanaging or getting in their way!). We also have a rich community of women founders for our companies to join. I can say from my own experience as a founder that having that community of fellow entrepreneurs you can turn to for help and support is crucial, and we try to facilitate meaningful opportunities to connect whenever possible.

How many new pitches (actual calls/zooms) do you take per month?

It definitely ebbs and flows, but I've already had two today! I'd say a typical monthly range is 15-30.

How many new investments do you make per year?

5-7

What's your sweet spot(s) in terms of check size, valuation, and vertical?

Our checks range from $125k-$500k right now. We are vertically agnostic and looking for sub $10M valuations.

What one portfolio company do you want to hype for us here?

Another company that went through our accelerator and we later invested in is Embodied Labs, an immersive training platform for caregivers. The cofounder & CEO, Carrie Shaw, has become an important voice in the eldercare community and has been featured in places like the New York Times and Wall St. Journal. Her leadership through the pandemic in a space that was especially hard hit has been admirable: she was able to adapt quickly and continue to grow the company in extraordinarily difficult circumstances, which is exactly the kind of determination and nimbleness we look for in founders.

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

It's been incredible to be part of the ecosystem evolving over the past decade--there are so many more startups and funds in the region than when I started my first company, and lots of groups and programming for entrepreneurs to plug into. For a long time now, I've believed this is one of the best places in the world to found a company, and I think that's going to become even more true over the next ten years. Founders in the PNW will benefit from a more mature ecosystem and the robust set of resources that will come with that. I also think we'll see more companies with geographically dispersed teams, so early stage startups will be able to cast a wider net for talent and potentially keep costs down.

What song is currently getting the most run on your Spotify/Apple Music?

I have a eight-month old daughter who is currently ruling the playlist at our house. :) Her favorites so far seem to be Buffalo Soldier by Bob Marley, 9 to 5 by Dolly Parton, and Dancing Queen by ABBA.

Favorite shoes?

Honestly, for the past several months, it's been my Lands' End slippers.

Favorite cooking ingredient?

Salt. I read "Salt Fat Acid Heat" by Samin Nosrat soon after lockdowns started last year, and it completely changed the way I cook.

Anything else to say?

Thank you Kirby for doing this! I spent a lot of time in the last few years traveling, so I was feeling less connected to Seattle prior to the pandemic. One silver lining for me of the past year was reconnecting with this place that I truly love. I'm proud to say that we just made our first Seattle investment (announcement coming soon), and I hope it will be the first of many in the PNW!

Seattle VC Profile: Sean Sternbach, VentureOut

June 2, 2021

There are hundreds of thousands of entrepreneurs working at Amazon, Microsoft, Google, Facebook, and dozens of other large tech companies in the Seattle area. They just don’t know they’re entrepreneurs yet. Sean Sternbach wants to help them discover their inner founders. He started Venture Out to achieve this goal, and he also makes investments in ex-Amazonians out of his Day One syndicate. Sean is simply a great guy who wants to see founders win, and spends his life trying to help them do so.

What made you decide to be a professional investor?

As a former startup founder, I wanted to pay it forward and help more founders. As a mentor at Techstars for several years, I realized how much I enjoy supporting founders. After a dozen angel investments and a ton of fun working with founders I realized there was an opportunity to invest in a more professional manner and there was no better place to do it than in Seattle.

What did you do before becoming an investor and how does that benefit your founders?

After co-founding a B2B SaaS company, I worked at Amazon, building products for the Home Innovation Team where I learned how to scale products to the millions. During this time I mentored a variety of startups in the Alexa Accelerator and Techstars Seattle. After doing this for two years, I was offered an opportunity to be the EIR for Techstars. This was a great opportunity to work alongside the MDs and see what it takes to get more startups funded.

Between Techstars and supporting founders from big tech companies, I realized there was a great opportunity to share my learnings with the founders I work with.

What are your most successful investments so far?

Latchel is a company co-founded by a former Amazon employee who led a team behind Prime 2-Day and 2-Hour shipping. The company manages 80% of a property manager’s maintenance coordination efforts while adding new profit streams to their bottom line. We met the founder during Seattle Angel Conference and I invested in the company before they went on to Y Combinator. We have made subsequent investments in Latchel as they continue on their growth trajectory.

My other most successful investment has been an investment of time building out a community, called Venture Out, which is composed of hundreds of founders who have experience working at big tech companies. I’ve learned so much from them and they have supported their fellow community members in so many ways. Startups like Iteratively, Spiral, Neu, Schedulista, Sniffspot, and so many more have made such an impact on other founders following in their footsteps and I couldn’t be more grateful for all of them.

Why should founders want you on their cap table?

What I love about investing in startups is that I get to support founders beyond writing a check. Sometimes it means being a sounding board, and other times it means sharing access to a strong network of founders, mentors, and investors who can support them. Having co-founded a tech company I can relate to what other founders are going through and I go to bat for my portfolio companies when they need help.

How many new pitches (actual calls/zooms) do you take per month?

~15

How many new investments do you make per year?

Fund I was 10 investments per year, and fund II, our current fund, will average 15 investments per year.

What's your sweet spot(s) in terms of check size, valuation, and vertical?

Pre-seed and seed investments between $50K and $100K across all verticals that are B2B or enterprise SaaS and marketplace companies. The valuation to me is not as important if all the other boxes are checked.

What one portfolio company do you want to hype for us here?

Fusebit. I met the founders a year before investing in them and the team is amazing. They just raised their seed round and have amazing opportunities for engineers to join them at the ground level.

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

For starters, hopefully the Seattle Supersonics will be back playing basketball here. The future for startups in Seattle and the PNW is strong. However, I’m excited to see what pockets outside of Seattle, but in the PNW, can grow into startup hubs and build off the foundation set in Seattle. I saw firsthand how Colorado has supported entrepreneurship outside of its key cities that promote a work-hard, play-hard balance and I think the PNW has an opportunity to do something similar.

What song is currently getting the most run on your Spotify/Apple Music?

Better Days by JJ Grey and Mofro

Favorite shoes?

It might be the hippy in me from my Boulder days, but when I can, I prefer to be shoeless.

Favorite cooking ingredient?

I never realized how many different kinds of mustards there are until I walked into DeLaurenti’s in the market. I’ve been experimenting with a variety of them and right now my favorite is Amora’s.

Anything else to say?

I’m grateful and honored to be part of such a great community that supports one another in so many ways. People like you. Thank you.

Seattle VC Profile: Julie Sandler, PSL Ventures

May 27, 2021

I hugely appreciate the Seattle/Pacific Northwest venture capitalists who paved the way for newer folks like me to participate in the ecosystem, and since I did it for the new wavers, I thought it would also be fun to profile some of our region’s OG VC talents in these pages. —KW

Ever since we pitched Dwellable to the Madrona partnership in 2014, I’ve been impressed with Julie Sandler. Her operating experience and product-first mindset set her apart immediately. Her intellectual rigor and creative energy drove her to co-found, raise and launch PSL Ventures. Her advice has been incredibly helpful to me as I made my own transitions in VC, and I’m pleased she took the time to share her story below!

What made you decide to be a professional investor?

Ten years ago, some amazing folks at Madrona offered to hire me.

What did you do before becoming an investor and how does that benefit your founders?

I was a would-be psychologist turned marketer turned product lead at both startups and on big company high-growth products. Those experiences ends up benefitting my work with portfolio founders in different ways, but I gotta say, just about everything in company-building comes down to people... so the psych background has been killer.

What are your most successful investments so far?

My first day at Madrona in 2011, my now-PSL partner Greg Gottesman pulled me in to help him evaluate, launch and invest in Rover. That was a great way to kick off a venture career. I was also a super proud investor in Integris (acq by OneTrust) founded by the great Kristina Bergman and a couple other nice outcomes at Madrona, and am proud to be on the partner squad supporting PSL companies like Shipium, Super.ai, Reserved, Boundless Immigration, and a couple coming out of stealth shortly here.

How many new pitches (actual calls/zooms) do you take per month?

15+ brand new interactions (e.g., never met the founders before) per month. Though they are definitely always two-way pitches.

How many new investments do you make per year?

I oversee our venture fund work at PSL and we’ll do anywhere from 6-10 new investments in a year. Personally I’ll lead 1-3.

What's your sweet spot(s) in terms of check size, valuation, and vertical?

Pre-seed, seed. Check size in the $1M-3M range but flexible - we want to empower the founder to put together the round he/she/they need. If you look at my current boards I’ve been investing lately in everything from ML applications (horizontal and vertical) to logistics tech to fintech, but wild generalist over here. And if there’s a software or digital component to your business, there’s inevitably someone on our 25-person team who is an extreme nerd and amazing thought partner when it comes to your market or category.

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

🚀 🦄 Out-of-control opportunity for founders, startup employees, investors, and LPs alike.

What song is currently getting the most run on your Spotify/Apple Music?

Unfailingly old school broadway showtunes or super modern musicals. Right now: “They’re Playing Our Song”.

Favorite shoes?

Nothing higher than two inches or I’m limping and complaining.

Favorite cooking ingredient?

50 types of hot sauce and a little too much oil/flour/refined sugar.

Anything else to say?

PSL hearts Ascend.vc.

Seattle VC Profile: Leslie Feinzaig, Female Founders Alliance

May 19, 2021

Leslie Feinzaig is not a traditional venture capitalist. Yet she’s changing the face of venture capital in Seattle, and the country, by helping accelerate and amplify female founder talent via the Female Founders Alliance. She and her team have built a startup community of overlooked founders who are doers, not victims. Whenever I’m in a room with Leslie and any founder, I can feel and see both the support and at the same time the challenge she issues her mentees: she won’t accept anything but the best, from founders or herself, and that makes her powerful indeed.

What made you decide to be a professional investor?

I didn't decide to be a professional investor. I decided that I wanted to do everything in my power to promote and accelerate founders' success. Participating in that success is the consequence.

What did you do before FFA, and how does that benefit your founders?

I am a two time founder, and often I know first hand the journey that other founders are going through. Prior to going out on my own, I was an executive in a couple of larger/later stage startups, a product manager at Microsoft, and a strategy consultant before that. In all, I've launched and managed tech products all the way from a zero-dollar launch on my own out of my basement, to a $2B annual budget with a team of hundreds at Microsoft, and literally everything in between.

It's worth noting that all of these fancy jobs happened post-business school, which is when I moved to America. Back in Costa Rica I basically took whatever decent job I could find - like being a store manager and a call center employee. I know what it's like to come from behind and to make something of yourself against all odds.

What one company do you want to hype for us here?

Everyone should go sign up for the waitlist on datacy.com - this company will revolutionize online privacy and give power back to the hands of the consumer.

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

I look forward to a decade of ingenuity, innovation and inclusive growth. I'm excited for the roaring 20s!

What song is currently getting the most run on your Spotify/Apple Music?

I Just Can't Wait to be King, from the Lion King soundtrack. My daughters run the show at home, so our playlist is heavy on Disney tunes.

Favorite shoes?

Currently, my bedazzled Uggs boots. Comfy, warm, and sparkly.

Favorite cooking ingredient?

Cheese.

Seattle VC Profile: Ben Gilbert, Pioneer Square Labs Ventures

May 5, 2021

You may not know it, but Ben Gilbert is Seattle’s most famous venture capitalist. His podcast (with David Rosenthal) is the #1 technology show on Apple’s Podcast charts. The startup studio he co-founded is the most prolific in the region. His wit and his voracious appetite for knowledge make him a formidable conversationalist and incredible analyst and investor. And for all of that, he’s always had time for a novice like me, and for founders across Seattle. What’s his story?

What made you decide to be a professional investor?

I'll first answer for Pioneer Square Labs. With our startup studio, PSL Studio, we started 25 companies in the past five years. While we are super excited about the impact we're making in the ecosystem, we recognize that most companies will be started the old fashioned way, and it seemed silly to tell entrepreneurs, "sorry, we can only work with you in this one particular way." PSL Ventures exists so we can work with all great founders in the Pacific Northwest, regardless of how they chose to start their company.

For me personally, I had helped to start several companies from PSL Studio, in addition from the two earliest companies from Madrona Venture Labs (MightyAI and MessageYes, selling to Uber and Nordstrom respectively). I had also bootstrapped several mobile apps over the last decade, some of which had millions of users in the early days of the App Store. I found that my passion over time had become working with entrepreneurs to build their business rather than needing to be the one who had the idea or was running the ship.

What did you do before becoming an investor and how does that benefit your founders?

Quick Resume:

- 4 Years: Indie iOS and web developer

- 1 Year: Microsoft PM, Office for iPad

- 1 Year: Head of the Microsoft Garage

- 2 Years: Madrona Venture Labs (Worked on MightyAI and MessageYes)

- 5 Years, PSL Studio (helped start 25 companies, CEO of one for a year)

- 2 Years, PSL Ventures

- Side projects over the years: Facilitating ~30 Startup Weekends, Building 4 iPhone apps (SeizeTheDay, Zero, RedRide, ThisWeekend), building the Acquired Podcast

See below on benefit to founders.

What are your most successful investments so far?

There are a lot of great PSL companies — some that have gotten more attention than others. Keep an eye out over the next few years! :)

Why should founders want you on their cap table?

For the "me" answer, I am the co-host of Acquired.fm, a podcast that now reaches over 100,000 people a month in the technology and venture ecosystem. That comes with a few things. First, the lessons learned, both from the 150+ businesses we've analyzed, and in building Acquired itself as a business. Second, the relationships with guests and high-profile listeners. Third, the show's reach is an unfair advantage for the founders I get to work with. Of course, I also have the operating experience from helping to start many of the 25 PSL spinouts, stepping into the CEO role for a year of one of our spinouts, and building apps as a bootstrapped developer in my early twenties.

For the "PSL Ventures" answer, we aren't your run-of-the-mill VC. Our team is 25 people, most of which are engineers, designers, digital marketers, and other operational company-builders. We are actively working every day on starting new companies in the PSL Studio. It's a totally unfair superpower for early-stage entrepreneurs to have such a strong "builder" team at their back. Of course, in addition to that, my partners are also wildly talented, having started and sold multi-billion dollar companies, starting other large venture firms, and angel investing in hundreds of companies. When you raise money from PSL Ventures, you have all of us on your cap table.

How many new pitches (actual calls/zooms) do you take per month?

I would guess the number is around 10-15. But really, the goal is to do less meetings and be able to give the highest-density, earliest feedback I possibly can in a process to make the best use of a founder's time. Ideally, if I do a meeting or two with an entrepreneur, it's something I'm excited about intend to purse seriously as an investment for PSL Ventures.

How many new investments do you make per year?

In addition to PSL Studio companies (where PSL Ventures invests in every spinout), we have historically invested in 4-6 external companies per year. It's not a high number. The flip side of this is that we do invest, we're all-in.

What's your sweet spot(s) in terms of check size, valuation, and vertical?

We love to lead, we love to be early, and we love to be a part of building the company. When we invest, we're really invested (both with our dollars and our whole partnership's time). Our check size ranges from $500k to $3m, and we'll look at any company whose primary value proposition is based in technology (though we have a strong bias for software businesses). I in particular like to invest in obsessed founders running pre-launch B2B businesses, or post-launch B2C companies with signs from customers/users that they're really onto something.

What one portfolio company do you want to hype for us here?

Check out Joon Care! Josh Herst, Amy Mezulis, and the team are on an an important mission to treat depression and anxiety in teens and young adults. As many folks know, there is a mental health crisis in our country right now. Joon's product provides a new model for mental health care, combining one-on-one teletherapy sessions with a mobile app-based experience, with support and resources for parents. We had the privilege of co-founding the company in the PSL Studio with Josh and Amy and I'm personally inspired by their dedication to help ease this enormous problem felt by so many.

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

An increase in every trend we're already seeing — incredible talent not only spinning out of Big Tech™ companies, but also from the mini mafia's we've seen from Convoy, Rover, Zulily… not to mention all the second offices of Bay Area companies. I think the "Cloud City" thing is real and we'll continue to see a boom of great companies involved in internet plumbing. I also think software markets are even bigger than we all thought (which is so widely-believed now, it's a meme), and Seattle companies are great at bringing technology to legacy markets (real estate, lumber, immigration, healthcare, etc.). We're certainly going to keep doing that at PSL.

What song is currently getting the most run on your Spotify/Apple Music?

My top album of 2020 was Taylor Swift's folklore, so there's that.

Favorite shoes?

Nike Free Rn Flyknit 2018 Black/White

Favorite cooking ingredient?

Garlic

Anything else to say?

To founders: keep going. The early part of a compounding graph looks linear — and like a very low-slope linear at that. I'm a big believer that you should be as thrifty as possible in the early days and give an idea the time and breathing room it needs to develop customer love.

As an example, for the first 50 episodes or so of Acquired, growth looked modest and nobody ever talked about us. That didn't really change until 3-4 years in, and all of the slow-burning "goodwill" we had built up among listeners felt like it showed up all at once. Brands and trust take a long time to build.

Lastly, most businesses shouldn't raise venture capital and that is more than okay. If you have the possibility of a nice business on your hands, don't optimize for fundraising milestones… optimize for building the great business! Raise capital if you find yourself in a competitive situation, a winner-take-all-market, or you see a near-term opportunity for hyper-growth. It's harder to build a bootstrapped business early days, but it forces discipline you'll be glad you have no matter which path you choose.

Seattle VC Profile: Isaac Kato, Techstars

April 28, 2021

I admire and respect the new wave of Seattle/Pacific Northwest venture capitalists, and thought it would be fun to profile some of our region’s up and coming VC talents in these pages. —KW

Isaac Kato has had a heck of a career. From guiding two startups to exits as an entrepreneur, to stints at blue chip VC investment firms, to founding and raising >$200M for one of the world’s largest green data centers (in Iceland!), he’s never been satisfied to stay in his lane. And yet even with his impressive experience, Isaac brings humility, curiosity, and empathy to every discussion. So it figures he’s the perfect leader for Techstars Seattle, especially during a year like 2020. Our ecosystem is lucky to have Isaac as a mainstay, and I’m lucky to call him a friend and mentor.

What made you decide to be a professional investor?

I knew in college that I wanted to be an investor. At the time, most business oriented friends of mine were going into investment banking or consulting. I'd read "Barbarians at the Gate" (I know - terrible source of inspiration), and I decided I wanted to be a principal investor. I've hopefully been a more benevolent one than the raiders of the 80s.

What did you do before becoming an investor and how does that benefit your founders?

My first job out of college was, in fact, working for the Roy Disney family as a growth equity investor. But, since then, I've gone back and forth between being an investor and an entrepreneur (I've founded two companies and run three of them - two exited, and one is a growing, profitable company that I raised $200M for over ten years). I have little doubt that having walked in founders' heavy boots has given me a lot of useful experiences to share and definitely made me a more empathetic and effective investor. In my current role as MD of Techstars, which is a blend of investor and educator, having been on the investor side for a long while also improves my ability to help the Techstars Seattle companies raise capital and understand investor processes and psychology (and I've built up a terrific global network of early stage investors over the years).

What are your most successful investments so far?

I led the Series B at earliest revenue for Postini, which was one of the first application service providers (ASP = SaaS in the early 2000s). Postini was subsequently acquired by Google for $800M. I was among the earliest institutional investors in CCP Games, an Icelandic MMORPG company that was acquired by Pearl Abyss, a Korean games publisher for $425M.

Why should founders want you on their cap table?

1) I've got a ton of relevant experience, both as a successful investor and a successful founder, 2) I've got a huge network, and 3) I'm incredibly easy to work with and view my sole role as an investor as doing whatever I can to help increase my founders' chances of success. I've seen and worked with my fair share of mediocre (and sometimes just plain bad) investors, and I strive to be the diametric opposite of them.

How many new pitches (actual calls/zooms) do you take per month?

Techstars is a funny job, in that we take the normal early stage investing process, chop it up, and then repackage it in a non-traditional way, such that the vast majority of our recruiting/screening takes place during a concentrated few months. Last year, I took about 200 zooms over a five month period.

How many new investments do you make per year?

We pick ten companies per year for Techstars Seattle, and I make 3-4 angel investments per year personally.

What's your sweet spot(s) in terms of check size, valuation, and vertical?

Techstars Seattle will invest $120K per company, usually into pre-seed and seed stage companies across a wide range of tech verticals. I myself typically write $25K - $50K angel checks into pre-seed, seed, and the occasional Series A.

What one portfolio company do you want to hype for us here?

I love all my children, but you can see the awesome members of the 2021 Techstars Seattle cohort here: https://www.techstars.com/newsroom/2021-techstars-seattle-accelerator-companies. (Did someone say, "cop-out!?!" Ahem.)

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

My magic 8-ball says, "Outlook good!" I do worry about how frothy the market for tech funding in general has gotten, but then again I felt that way last year, and the year before, and the year before that, so… Regardless, in the long run, the increasing presence of big tech cos here can only be beneficial for the startup ecosystem. Sooner or later, a percentage of folks working at those places will inevitably get the startup itch, and once they take the dive, it's hard to go back. The flywheel is spinning.

What song is currently getting the most run on your Spotify/Apple Music?

Parklife, the 1994 Blur classic. I've also been wearing a lot of tracksuits recently. Sergio Tacchini 4ever.

Favorite shoes?

It's a tossup between my Dunlop insulated wellies (because my backyard is a wet, muddy mess), my ten-year old Sorel Manawan house slippers, and my Scarpa TX Comp Telemark ski boots. I haven't worn anything stylish on my feet since we went into lockdown. Kirby, forgive me for my sins...

Favorite cooking ingredient?

Does dry-aged ribeye count? I keep it simple with an Adobo rub.

Anything else to say?

In all seriousness, as a relative newcomer who has worked in the Bay Area, London, and Boston, one of the things I love about the Seattle/PNW tech ecosystem is how mutually supportive a community it is. I hope we can preserve that spirit for years to come - I certainly intend to do my part. Oh, and Kirby, I have some really nice bourbon arriving next week. We need to do that backyard hang.

Seattle VC Profile: Zane Khatib, Brighton Jones

April 15, 2021

Zane Khatib is the kind of person that makes me optimistic for the next phase of Seattle’s startup ecosystem growth. He’s energetic, positive, intelligent and curious. He handles everything from sourcing to LP relationships and fund admin, all with aplomb. Glad I’ll get to say I knew him when…

What made you decide to be a professional investor?

I grew up watching my mom found and grow two businesses. Seeing the passion and drive required to build something from the ground up became inspiring to me and ultimately, manifested in me wanting to spend my career working with startups. As I went through undergrad, I searched for ways to get involved in the Seattle VC ecosystem. Primarily done through persistent (and probably irritating) LinkedIn messages to entrepreneurs and investors to grab coffee or volunteering to support due diligence efforts at local angel investment groups. Every interaction with founders has been a rewarding and educating experience and continues to be so. Needless to say I have no plans to make a career change.

What are your most successful investments so far?

We have just finished deploying our first fund and have recently completed raising our second. We are still in the early years so this is difficult to answer now, but I look forward to having multiple answers to this question in the coming years.

Why should founders want you on their cap table?

The easy answer is that our group, Brighton Jones Investment Partners (BJIP), is comprised of exceptional LPs who bring a unique mix of expertise, operational acumen, financial aptitude, and business connections to the table. Tyler Mayfield and I only invest in founders that we believe in and plan to support fully in any way possible. This past year has been a challenging one for most startups and has really put us to the test. Rather than speak to this ourselves, we’d prefer anyone interested to simply reach out to the entrepreneurs we back.

How many new pitches (actual calls/zooms) do you take per month?

The deal flow has increased exponentially over the years. Hard to put a number to it, but we try and be as intentional as we can with our time and founders.

How many new investments do you make per year?

Target 6-8

What's your sweet spot(s) in terms of check size, valuation, and vertical?

Our sweet spot is between $1m-$2.5m. We have a broad mandate so our investments have spanned across various verticals from AgTech to consumer goods, however, we tend to steer clear of anything that will require FDA clearance (as fun as that process sounds). In terms of stage, this is vertical dependent, but we typically target seed – series A.

What one portfolio company do you want to hype for us here?

Beta Hatch. Awesome company led by an impressive founder/CEO, Virginia Emery. Excited to watch them grow!

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

The success of Seattle based startups like Convoy, Icertis, Highspot etc. is a testament to the brilliant minds that have flocked to Seattle over the years. With the continued success of so many young companies, we are going to continue to see remarkable new founders roll out and create something of their own. While COVID has changed the fundraising dynamic, I believe that the VCs that are local will be able to provide unique value to entrepreneurs as they navigate the challenging road of building a business. I look forward to supporting and participating in the growth that will occur within the PNW’s startup ecosystem over the next decade.

What song is currently getting the most run on your Spotify/Apple Music?

Ahh that’s tough to answer.. I am guilty of listening to a song nonstop for a couple days and then moving to the next. Right now the song of the day is either Chemicals by SG Lewis or Slipping Away by Leisure, but will likely be a completely different artist and genre by the end of the week.

Favorite shoes?

My white Nike Blazer Low LE or Adidas Ultraboost. Unfortunately, both get absolutely destroyed in the Seattle weather 😃

Favorite cooking ingredient?

Answering this implies I know how to cook. If I have to pick one I’ll go with Montreal Steak Seasoning.

Anything else to say?

Excited to be a part of this blog series. Looking forward to what the future holds for both Ascend and BJIP!

Seattle VC Profile: Rob Eldridge, Tapas Capital

April 7, 2021

Rob Eldridge was the CFO of Amazon’s China, Japan and India businesses. After that, he was the VP of Product for Fulfilled By Amazon (FBA). Now, he runs Tapas Capital, a burgeoning micro VC fund. There are few investors in Seattle with a more impressive operating track record. And yet, when I met him a few years ago, I was struck by how understated he was. Instead of a bombastic, “here’s how it oughtta be” grizzled vet, Rob brings curiosity and reserve to every relationship, allowing entrepreneurs to lay out their thoughts and giving space for the conversation to breathe.

What made you decide to be a professional investor?

I enjoy building and operating businesses and I realized how much I missed that after I left Amazon during my sabbatical/semi-retirement period. I was doing some early-stage founder advising and personal investing and thought I would marry the two activities and find a way to be more involved, and aligned, with a network of early-stage founders and their projects. That is when I decided to become a full-time VC.

What did you do before becoming an investor and how does that benefit your founders?

Product management, operational finance, investment banking, barkeep, housepainter, pedicab driver, English teacher. Had a lot of jobs, but technology has been a big part of it. At heart, I’m a tech geek – I learned to program in the early-80s and am now teaching myself python. In short, I have been involved in technology-related businesses since the early-90s and have built, operated and advised teams in a wide-variety of industries, on multiple continents, including most recently at Amazon where I spent a dozen years, and before that at Broadview, a boutique technology M&A firm based in Silicon Valley, and Sun Microsystems.

What are your most successful investments so far?

We’re early in our lifecycle and our portfolio companies are still growing and experimenting. I honestly feel like all of our companies have been pretty successful. It isn’t easy to build something from scratch, but products are being launched, teams are being built, customers are engaging, and feedback loops are operating. That seems like a good measure of success in the early days of a company’s evolution.

Why should founders want you on their cap table?

Between Greg and I, we bring decades of experience at Amazon.com (and elsewhere) where we built, operated, and scaled some of the world’s most innovative companies and we apply those learnings and our network to benefit founders in our portfolio.

How many new pitches (actual calls/zooms) do you take per month?

I see about 30 projects a month and take initial calls with about half of those project’s founders to learn more about them, what they are building, and determine if there is the potential for an investment fit.

How many new investments do you make per year?

Between 7-10.

What's your sweet spot(s) in terms of check size, valuation, and vertical?

Our average check size is about $100K and we prefer to invest early in a company’s lifecycle (pre-seed or seed rounds), although we have selectively made a couple later-stage investments. We are sector agnostic, and while we have invested in a handful of hardware companies, we get most excited about software-driven businesses creating brand new categories or operating in greenfield spaces.

What one portfolio company do you want to hype for us here?

Aaah…the Sophie’s Choice question. Laura Malcolm at Give InKind, Sarah Haggard at Tribute, Shane Kovalsky and Vince Coppola at Mystery, Ian Freed at Bamboo Learning, Kris Bleisner at Vega Cloud, Scott Hix at Avocor and Kevin Sun at Dex are all PNW-based founders working on some really cool products and we are lucky to have the chance to work with them.

What do you think the next ten years looks like for Seattle/Pacific Northwest startups?

I think the future is incredibly bright. The critical ingredient of highly qualified, entrepreneurial founders exists in abundance in the PNW and the supporting infrastructure of early-stage VCs, founder mentoring/networking forums, focused support for underappreciated founders, and an expectation of reinforcing success by giving back to the community are all being built and grown. We still have some progress to make along all of these dimensions, but I’m really excited to be part of such a vibrant and dynamic community.

What song is currently getting the most run on your Spotify/Apple Music?

Been revisiting Miseducation of Lauryn Hill quite a bit lately (which btw just reached Diamond status), as well as creating a list of inspired (e.g. as good as or better than the original) covers. Obvious ones like Johnny Cash’s version of Hurt, Alien Ant Farm’s Smooth Criminal, Red Hot Chili Peppers’ Higher Ground and Nancy and Ann Wilson’s Lincoln Center performance of Stairway to Heaven are all on my list. But would love to hear who/what else should be considered (@robeldridge).