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What does a Venture Partner do?
Most people know me as an early-stage investor in now over 30 internet companies through w media ventures and more recently, as a co-founder of the Vancouver-based start-up accelerator GrowLab. Lesser known is the fact that I also work as a venture partner for Munich-based Acton Capital. So what does a venture partner actually do?
Venture Partners are not full partners of a VC firm (who can write cheques for investments) but are usually brought in by a partnership to find new investment opportunities and manage portfolio companies. This is exactly my role with Acton Capital – while the fund is primarily focused on European investments, my role is to help with North-American deal flow. At the beginning of the week we announced our first deal on this side of the pond, a $6 million Series B investment in cloud-based legal management platform Clio. I am very excited to join the board of the company and work with the two founders Jack Newton and Rian Gauvreau to help build their company.
So as an entrepreneur, if you work with a venture partner of a VC firm, you need to understand his/her role. One the upside, venture partners are usually seasoned entrepreneurs and executives that have generally a deep understanding of your space and your company. At the same time, they are not the ones writing the cheques which might lead to complications in the investment process as they have to build internal support for the deal.
Related articles
- Clio focuses on legal space that’s ‘ripe for disruption’ (blogs.vancouversun.com)
- Vancouver’s Clio secures US$6-million venture capital investment (business.financialpost.com)
An amazing year
2011 was an amazing year – made 10 new investments (most ever!), sold one company (Sparkbuy to Google) and started GrowLab with an exceptional team of co-founders.
But more importantly, it was an amazing year for Canada’s start-up ecosystem – there is a new generation of angels and VC’s emerging in this country, more and more US VC’s are leading large financings rounds in Canadian start-ups, local start-ups are nailing it in SaaS, a few wordclass incubators have sprung up, organizations like the C100 are starting to make a real impact, and we have had a very healthy M&A activity this past year. What we still don’t have – and are probably many years away – are enough anchor companies.
2012 will most likely be a much tougher year for start-ups worldwide. We might have seen the end of the easy access to early-stage money and a recession might be around the corner in Europe and North-America. But despite these short-term challenges, I remain extremely bullish on the opportunities for Internet companies. We are still only at the very beginning of the Internet cycle so keep your heads down, focus on your long-term vision, build product, listen to your customers – and build those missing anchor companies!
Happy holidays to all of you and to an even better 2012!
New investment: Unbounce, A/B testing made super-easy
Image via CrunchBase
Unbounce makes building, publishing and A/B testing of landing pages super-easy. It does not require any IT involvement and puts the marketer into the driver seat. This makes the product so successful and is the basic SaaS value proposition: let the user be the buyer and offer him a risk-free monthly subscription plan.
I have watched the team over the years bootstrapping their business – heads-down building product, listening to customers and building a great reputation in the marketplace. Now they felt it was the right time to raise money to scale the business even faster and they assembled a top notch group of investors led by Mark MacLeod from Real Ventures.
I really hope that many other start-ups look at Unbounce as a role model for their focus on solving a real problem, understanding customer needs and building a great product. Congrats, Unbounce team, well done – excited to be aboard!
P.S.: Funding announcement happened 2 weeks ago but only got around to blogging about it now.
Related articles
- Canada – land of SaaS? (wmediaventures.com)
New investment: Edmodo, social learning network for teachers and students
Image via CrunchBase
Education is – besides health care – one of the verticals with the most amount of opportunity still left in the digital world. And still a lot of innovation in this space in the past few years was rather incremental (e.g. online test prep, language learning) than ground breaking.
Things are starting to change and I was very excited that I got the opportunity earlier this year to invest alongside Union Square Ventures in Edmodo, a social learning network for teachers, students and schools. Edmodo “provides classrooms a safe and easy way to connect and collaborate, offering a real-time platform to exchange ideas, share content, and access homework, grades and school notices”. It has the power to help teachers engage students and allow students to reach their potential.
Education in the digital world feels like the 2nd or 3rd inning of a 9 innings baseball game and there is a realistic chance that we will not only be able to redefine in the next decade how students learn but make education universally accessible. I hope that Edmodo can play a crucial role in that process.
The company announced today a huge Series B round led by Matt Cohler from Benchmark and Reid Hoffman from Greylock with both joining the Edmodo board, helping the company to execute even faster on its vision to build the educational graph for learning.
Related articles
- Edmodo:The Total Classroom Solution (freetech4teachers.com)
- Innovation in Education (usv.com)
- Greylock And Benchmark Lead $15M Round In Social Collaboration Platform For Classrooms Edmodo (techcrunch.com)
- Edmodo Wants To Make Social Networking A Learning Experience (forbes.com)
Canada – land of SaaS?
When Bessemer Venture Partners recently published their map of major cloud players, I was surprised to see so many Canadian companies on there. Shopify, TribeHR, Unbounce, Clio, Hootsuite, Radian6 and Freshbooks made the list and a few others (like Wave Accounting) probably should have been on there as well. So why are Canadian companies so much better represented in SaaS than in consumer internet? I can mainly see two reasons for that:
- SaaS companies (like e-commerce companies) have a much easier time to monetize their product than most consumer internet plays as monetization doesn’t depend on scale like every ad driven monetization. This means that those companies require way less funding and most of them can be built on smaller seed and angel rounds which is ideal for the sometimes restrictive funding environment we face in Canada. Unbounce, a company I recently invested in, even bootstrapped their business to thousands of paying customers before they took funding to scale their business.
- The second reason is linked to sales & marketing. Traditionally, purchasing decisions for enterprise software were driven by IT departments which translates into a lengthly and costly sales process favouring those software companies that have the strongest relationships into the decision makers at the buyer. Geographical proximity plays a large role in building those relationships which in turn makes it very hard to build large enterprise software companies outside of the Silicon Valley. SaaS starts to remove IT from the purchasing process, meaning the user and the buyer are, increasingly, the same person – the product quality is now much more important than relationships and the chances of building a big SaaS company anywhere in the world have increased dramatically.
Related articles
- New investment: SilkStart, SaaS for membership organizations (wmediaventures.com)
- Forrester: SaaS Providers Should Go Vertical (devx.com)
- Why Human Resources Software Start-Ups Are On Cloud 9 (blogs.wsj.com)
