Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Mike Edelhart was recorded in August 2020.
Mike Edelhart, Managing Partner at Social Starts and Joyance Partners, shares some fascinating developments from their portfolio, especially a healthcare startup that is thriving in the COVID-era.
Sramana Mitra: Tell us a bit about your background and your fund. Let’s get acquainted and introduced to our audience.
Mike Edelhart: I’m the Managing Partner of two separate but cooperative sets of very early stage venture funds. Social Starts has been active since 2010. I joined as a partner and have been active since 2016. They are the latest expressions of my career, which goes back to the era before the IBM PC.
I’m a nerd of the first generation. I’m a journalist by background with a focus on science. I oversaw Ziff Davies computer magazines and the big testing labs behind them. I oversaw the standard benchmarks of the PC era. I sat on the Internet Society Board back then.
I got into venture through Masayoshi Son in the 1990s. I started it with a colleague from Ziff Davies 10 years ago because we felt that this generation of entrepreneurs has a potential for even greater impact at every level than the earlier revolutions we’d been a part of.
Our funds are unusual. We are worldwide funds focused on being present from the very start. We call what we do as moment-of-inception investing. Our goal is to be the first investor in companies with the highest potential for great value in investment segments.
Sramana Mitra: When you say the first money, does that mean you invest in concepts? Do you want to see a certain level of validation before you’re willing to invest?
Mike Edelhart: We invest at the very beginning, but I’d be hard-pressed to imagine a great entrepreneur today even at the earliest stage who hasn’t built something. We don’t invest in ideas not because ideas aren’t interesting, but because they indicate that we haven’t yet seen genuine entrepreneurial intent.
With script language, AI, and prototyping tools even at the college level, we would expect something to have been built and tested out. We do invest very very early. In some cases, we even start talking to folks when they’re still in degree programs.
Sramana Mitra: But you don’t need to see revenue necessarily?
Mike Edelhart: We often don’t see revenue. We’ve invested across many categories since we started, but we are rather focused on individual health through health delivery of happiness across our fund. That spans from consumer-related things like water, food, and consumer goods to deep, scientific things.
Often, we are looking at companies that are well ahead of revenue. At that point, we’re looking at the segment they’re in. Do we believe in this segment? What is the nature of the science and technology we’re looking at? Is it deep and differentiated? Who are these people? Are these the best possible human beings to take advantage of this opportunity in the world as it stands.