After ~1 year at Cowboy focused entirely on seed, my frameworks for investing at this stage have changed.
Still (and forever) learning, but sharing my current thoughts on seed investing ✍️
1/ Founder > market
Investing at seed often means investing when the market opportunity/size isn’t clear. I believe it’s more important to invest in amazing founders than amazing market opportunities*.
*network effects businesses excluded
2/ Partner w/ "Learning Animals"
I picked this one up from the queen of coining new terms @aileenlee. Founders with a growth mindset can adapt to changing market dynamics & develop into successful leaders at different stages of growth.
3/ Build for tomorrow
Founders at seed are building for tomorrow's world, not today's. They need foresight grounded in a deep understanding of the tech & market forces driving change.
This is framed very well by @m2jr in his piece on "Backcasting".
medium.com/@m2jr/how-to-b…
4/ Diligence should not convince you to make an investment
Using diligence to move from "no" to "yes" is dangerous. It can result in projecting a vision on founders that isn't theirs.
S/o to @twang for keeping me honest on this point.
5/ Why (this founder) now?
I used to obsess over “why now” but have edited that to “why this founder now”. At Cowboy, we look for 'earned insights' that demonstrate a founder's unique understanding of their space in addition to the tech/market trends supporting "why now".
6/ Find talent magnets
This extends to advisers, early engineers, other investors, and any other high-quality ppl the founders have convinced to spend their precious time helping them. This can be a huge point of leverage early-on.
7/ Invest in products w/ a fast 'time to wow'
This is so important for seed-stage companies to drive early adoption, usage, & customer/community love.
8/ Back companies that can get to Series A
Our companies usually raise multiple rounds & need to hit milestones to raise more $.
At Cowboy, we consider this in diligence & do an all-hands session post-investment to fine-tune milestones & have a path to get there (hiring, etc.)
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