Sramana Mitra: What check sizes are you writing in the seed stage? John Frankel: Our check sizes are from $300,000 to $700,000 for 10% of the company. Sramana Mitra: What are the secrets of your higher hit rate? What are some of the nuggets that you have learned? What are the best practices?
Sramana Mitra: The deal size at which you had to meet in person has vastly changed. You can do large deals and raise investments without meeting in person. That is a massive shift and a massive removal of friction in scalability, fluidity, and velocity in any company’s growth trajectory. John Frankel: Totally. It is amazing
Sramana Mitra: The AI sector of the industry, which is not actually a sector but a horizontal technology that is being applied to all kinds of sectors, has exploded even with the downturn. The amount of money that has gone into AI startups globally is huge. It doesn’t seem to have missed any beat in
Sramana Mitra: What has been the experience at your fund in your existing portfolio companies as well as new investments? John Frankel: We were very concerned in March and April that our companies would be hit hard. Some were hit hard, however, since we predominantly invest in secular rather cyclical businesses our companies held up
John Frankel is Partner at ff Venture Capital. We had an extensive discussion about Covid’s impact on the startup ecosystem, the changes we notice, so forth. Sramana Mitra: Let’s catch up. How has the pandemic year been? What are you doing these days?
John Frankel is Partner at ff Venture Capital. We had an extensive discussion about Covid’s impact on the startup ecosystem, the changes we notice, so forth.
Sramana Mitra: Unicorn mania started to rationalize a little bit in 2016. This year, it has stabilized. But there is still a huge amount of late stage capital out there. Traditional VCs have raised very large funds. As a seed investor, you could get buried under later stage liquidation preferences if valuations run up like
Sramana Mitra: I’m going to ask you a few trend questions. How do you process the current investment climate where capital is moving further and further upstream? How does a seed investor mitigate the Series A gap? The number of seed investments that are happening have gone up but the Series A number has stayed