#lerer ventures

Quote of the Day: Ben Lerer, Managing Director of Lerer Ventures and Cofounder and CEO of Thrillist.com, shares a tip to startups looking for venture capital—it's all about personality.

BERLIN — Moped, a messaging startup which was somewhat ahead of its time, prior to the explosion of similar such apps in the latter part of the year. On Moped, private messaging with the same hashtag support seen on Twitter was integrated with Dropbox.…

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Seed&Spark Wins Season 2 of BetaBeat’s Pitch Competition: The Pitch Seed&Spark Beat Out Competition for BetaBeat Glory and a $10,000 Grand Prize

Seed&Spark Wins Season 2 of BetaBeat’s Pitch Competition: The Pitch Seed&Spark Beat Out Competition for BetaBeat Glory and a $10,000 Grand Prize

New York, NY, May 29, 2013 – Seed&Spark, the world’s first crowd-funding and digital distribution platform made just for independent film, took first place in The Pitch Season 2, BetaBeat’s (a New York Observer blog) pitch competition. Along with BetaBeat glory, Seed&Spark was awarded $10,000 in funding that will go toward improving the website.

Featured in Episode Seven of The Pitch, Emily Best, Founder and CEO of Seed&Spark, was able to wow judges – Venture capitalists Nikhil Kalghatgi of SoftBank Capital and Steve Schlafman of Lerer Ventures – with the passion and innovation that she’s brought to the independent film industry. When brought back as one of three finalist, Emily, labeled as a “dark horse” by Schlafman who wasn’t initially excited to see “another crowdfunding site”, was able to shine through by discussing her founding team’s experience in the independent film industry which gave them an advantage when competing with other crowdfunding sites. Because of this experience, Emily was able to show users on Seed&Spark something special from day one which lead the judges to believe she would be able to compete against more established competitor sites.

“It feels incredibly gratifying and validating that two such well respected Venture Capitalists thought that ours was the best idea,” said Emily when asked for comment on her win. “There’s something about The Pitch that is of course dear to my heart as coming from filmmaking that’s really about telling a compelling story. Finding that central thread, like in a movie you find the central relationship, and I think they identified it as ‘what is the core feature that is going to distinguish us’. Having participated at The Pitch and getting the judges’ feedback is going to help me articulate the Seed&Spark story going forward.”

The Pitch is a pitch competition that is put on by BetaBeat. In its second season, The Pitch featured 10 New York startups in an episode style pitching competition that aired between April 18th and May 23rd. Each episode featured one startup’s pitch. Pitches were posted on the BetaBeat website every few days.

For more information about Seed&Spark, watch a short video, shot and produced ultra indie-style by the Seed&Spark team.

About Seed&Spark

Seed&Spark is building a truly independent filmmaking community where filmmakers and audiences come together for crowd-funding, production, and streaming distribution. Every time an audience member supports the making of a moving picture project (funding, following, sharing) they earn “Sparks” which can be redeemed to watch movies on the streaming platform.

Yesterday I decided to wake up a bit early and head to the New York Tech Business Development Breakfast. The breakfast was pretty much as expected. I'm starting to understand that these meet-ups are usually comprised of a handful of the same people with one or two new faces checking out the events. It was a cool opportunity to talk with some people who do business development at Etsy, Uber, and Secondmarket. The founder of Say It With A Condom was also there passing out business cards - which were hilariously wrapped condoms. I thought it was definitely a worthwhile experience to check this breakfast out, but I don't see myself rushing back anytime soon.

Later in the afternoon, I headed over to Lerer Ventures for their open house. At Lerer, I got to meet with a few of the venture investors, who all seemed like nice guys. There was also a dynamic mix of entrepreneurs in the room. I saw a couple of people that I met at the USV happy hour. The best part of the day was when I got to meet someone from Treehouse. Treehouse is an interactive resource to teach people how to code. I talked about my experience learning python, and the Treehouse employee offered to let me check out some of the Javascript stuff on their site. I watched a few videos. They seem cool. I'm still a big fan of Learn Python The Hard Way and Udacity.

Last night by accident I ended up at a mixer that Lerer Ventures (home of all things condescending and bro-y if my one experience with them is any example) and SV Angel at The Wren. Out of perhaps 50 start up oriented folks I counted 8 women including myself. I wasn't actually invited (party crasher I guess) you know despite being a founder and all that jazz pretty sure that crowd doesn't know or care about my existence. Which is really my preference.

Last night I attended an NYVC event at Dogpatch Labs to hear Steve Schlafman speak.  Steve is a Principal at Lerer Ventures, the most active seed stage venture capital fund in NYC.  Before joining Lerer, Steve was VP of Business Development at Stickybits, which pivoted into Turntable.fm.   He also was the Director of Venture Investments at The Kraft Group, which sounded like it was an incredible experience.  The entire talk was about an hour long, and Steve was generous enough to stick around afterwards to meet with people.  I tried to take some notes on points that I thought would be helpful, or interesting, but I definitely did not get capture every nugget of wisdom.

A really important point that Steve emphasized was that if you have a fundamentally broken product, throwing more money, or more features won’t fix it.  I think often entrepreneurs think raising more capital, or adding a handful of features will improve their product, but ultimately they need to rethink the foundation of what they are building.  A great tip which Steve suggested, when trying to figure out how well a startup is doing, is to twitter search the name of the service.  The level of activity can be a good indicator of how well they are doing.  Try it out, it works!

Steve spent sometime detailing his academic, and professional journey, which was excellent.  I won’t get into the entire history, since you can easily find all the information online, but I will say that Steve’s success is a result of his hustle, humble nature, and excellent ability to build relationships.  Steve also spent a lot of time speaking about Lerer Ventures, and what people who are looking to raise money from them should be aware of.  Lerer focuses on consumer internet companies, and also does invests a little bit in the B2B space (small/medium size businesses).  The team at Lerer likes to think of themselves not as investors, but rather as advisors, who serve as a support mechanism for the companies in their portfolio.  Like many other successful investors, they believe it is best to invest in people, who are capable of executing a vision.  Lerer does not choose to take board seats when it invests in seed rounds.  Product is also very important when evaluating an investment.  Product consists of brand, design, positioning, and who it is being built for.

So you want to raise money from Lerer?  Here is what they look for:

Action Not Analysis- There is no need for a fifty-page deck; you are better served by telling an effective story of why you are going to win.

Team & Culture- this is critically important for any successful company.  Off-sites, team building, and an environment that can get people excited are extremely important.  Founders need to prove that they have the ability to ability to hire, and partner with the best people.

Customer Obsession- Why is your company valuable? What is the psychology of your user? You should always be thinking about this, and have good answers.

A Good Story- Your story will extend into your brand, how you are able to hire, and every other aspect of your business. Crafting a good story will serve you well.

Hustle/Traction- show that you are doing everything possible to succeed, and it helps to have numbers that show that you are getting users, listening to them, and constantly iterating.

Composure & Confidence- pitching to a VC can be a high-pressure situation for many entrepreneurs who have a lot riding on a meeting- but it is important to remain calm, be effective, be efficient, and be concise.

Data Driven Approach- explain this is how we are thinking about the business.  You cannot control/improve what you don’t measure.  It is important to build this approach into your company’s culture; it creates a mechanism for accountability.  Companies that don’t hold individuals accountable don’t succeed.

Now that you know what Lerer is looking for, here is what the process of getting an investment from the firm looks like.  First it helps to have someone make a warm introduction.  After the introduction is made, the team will review your business plan, and schedule an in person meeting.  After the meeting, the team will conduct due diligence, then have a partner meeting, then conduct further due diligence.  If you have made it this far, the team will either have a decision for you, or engage in some negotiating.  After this process the deal will close, and then Lerer will begin their role in supporting the founder build her business.  Steve explained that Lerer Ventures likes to participate in strategy sessions with entrepreneurs, where they can dive into the product, understand the business, and determine how they can better add value to the founders. These strategy sessions are important because Lerer is “only as good as the support we provide to our entrepreneurs.”  Lerer often adds value by connecting service providers with its portfolio companies.  For example it had people from Facebook come and speak about how companies can be more effective using social. 

All the information on Lerer that I have shared above was really great to learn about, but the most interesting, and rewarding part of the event for me was Steve’s more personal insights.  Reflecting on his own journey, he explained that there is no one “right” path.  Luck matters, but you can improve your luck by realizing that networks matter.  In order to build an effective network you need to build relationships, and be part of the community, without needing anything in return.  Steve also explained how passion, and loving what you do are critical.  Meet new people, and engage the community, you never know how you can help someone, or how they might be able to help you.  Steve is also a firm believer in challenging the status quo, and taking risks, you can never get a return unless you take a risk.  When building anything, build for yourself, and be passionate about your work.  Steve recalled when he was at Microsoft people would be leaving at 5 PM, this wouldn’t be the case if they were passionate, and interested in the work they were doing.  “Best things that happen are things that often don’t.”  This statement from Steve really stuck with me.  You could probably sum up his career to this point with that single statement.  Not getting a job with the NFL, led him to the excellent opportunity to work with The Kraft group.  Not getting accepted to Y-Combinator, ultimately landed him at Lerer Ventures, where he attends YC Demo Day as an investor. He now has the ability to write checks to YC startups (think about how awesome that worked out).  Despite all his success, it was refreshing to see someone who was able to reflect on his path, and realize it was a result of his ability to build relationships, stay determined, mixed with a little bit of luck and timing.  If you ever get the opportunity to hear Steve speak, or have a meeting with him, don’t pass it up, I know I won’t.