By guest author Irina Patterson
Irina: Do you think in terms of total available market, like a certain number?
George: At the seed stage, we are just thinking of a big picture – will the innovation of this create brand new behaviors, have an impact, or change an industry or market? And that’s qualitative. At the first venture round where we’re investing millions of dollars, we do do a market analysis, and we look for markets that can support a billion dollars.
Irina: And what about the people? You already said it’s good if they are serial entrepreneurs who have proven themselves, but will you invest in somebody who is just out of school with no prior business experience?
George: Yes, I see most of the people in our seed program are that way. And half of the serious traditional venture rounds, series A investments, are people recently out of college. It’s not a requirement that they be serial entrepreneurs. It’s helpful, but it’s not a requirement. For example, we’re investors in Scribd, and the founders had basically left Harvard in their senior year to start the company. So, I think at the time they started they were twenty-one.
Irina: And what about business teams? Can a single founder come to you, or do you invest only in teams?
George: No, a single founder can come to us. We backed a great guy in the seed investment, actually from Russia. His name’s Dmitri. He started a company called MightyMeeting.
Irina: Was he already in the States or still in Russia?
George: He had emigrated to New York about a couple of years before that.
Irina: How did he find you?
George: I saw him presenting at a conference and the audience started applauding halfway through his product demonstration because the product demonstration was so good. And that’s how I spotted him. And then I approached him.
Irina: What was the conference?
George: It was The Founder Institute — have you ever heard of them?
Irina: Yes, I know who they are.
George: They had a showcase, where they were doing product demonstrations for some of their top companies.
Irina: So, he was enrolled in The Founder Institute?
Irina: And what is his product? What does it do?
George: It’s called MightyMeeting. It is exactly like WebEx, except it works from your iPhone or iPad. You can initiate a conference with slides and full audio, and have lots of people pay attention to it remotely. So, if you’re traveling with your iPhone, you can conduct an equivalent of a WebEx presentation without having to have a laptop.
Irina: Are there any character traits of a founder that you think are particularly important?
George: One is, I think, definitely – high intelligence; relentless drive, meaning that, no matter what happens they’re going to keep driving the company to success; creativity, because there are always bumps and difficulties, and we need creative thinkers who can think around the problems to still win. And I think the fourth thing is the ability to attract other great people to their team.
As the entrepreneur, you have to be an effective salesperson for your idea. And being an effective salesperson is not about just how good you can sell the idea and the vision, it’s also being able to sell yourself and your accomplishment to date and why people should follow you. It’s basically selling through leadership.
Irina: Exactly. Go and inspire people, right?
Irina: What is your sector focus?
George: Consumer Internet.
Irina: What is your preferred investment type?
George: It’s either in convertible notes that have a cap conversion price into the next round, so in a lot of ways it looks like equity or preferred stock.