Some Wednesday thoughts on geography.

As we come out of the pandemic, I don't even know what "geography" means anymore.

What does it mean to be focused on investing in US companies? What does it mean to be a US company?

Some thoughts >>
1) Even before the pandemic, we did all of our interviews over video conf and most of our companies are located all over the US, Canada, and Southeast Asia.

There are so many founders we've backed whom I've never met in person even to this day!
2) That being said, we've always had a specific mandate to invest in startups in the US, CAN, and SEA.

These days, though, I have no idea where our founders are. During the pandemic, so many ppl have moved and everyone went remote.
3) And this has carried over into our investing as well. We're now seeing companies incorporate in the US but are literally everywhere.

In fact, one of our newest portfolio companies Remotebase was just in the press:

menabytes.com/remotebase-see…
4) And the funny thing is that article mentioned that they are our first Pakistani company. And that's true! But until I read that article, that thought didn't even occur to me...

Why? Because they are incorporated in the US. They have US legal counsel. They serve US customers.
5) One might say this is a funny thing to say, because clearly Remotebase has built their team outside the US. The thing is -- so many of our companies -- even pre-pandemic have hired ppl outside the US...

What does it mean to be an int'l company? Or a US company?
6) I'm not even sure anymore as far as talent and hiring goes. We live in global world -- even more squarely global post-pandemic.

In fact I alluded to this in 2019 as we set up our own int'l partnership @HustleFundVC :
7) But, I do think where you incorporate still matters. This has ramifications on taxes. As well as on which jurisdiction gets to resolve issues should they arise.
8) Incorporation also has implications for cost -- especially expensive legal costs. I've talked about this before here:

9) In fact, we see many "int'l companies" incorporate in the US for all these reasons. More and more, I think VCs who are "focused on the US" will be funding these companies going fwd.

In a podcast, YC said 40% of their batches are now int'l. (Of course, they are all US incorp.)
10) I think teams who have lived in the US and have an understanding of how to do business in the US and have moved elsewhere are best poised to take advantage of this new era we are entering.
11) They will be able to chase after a global mkt from day 1, raise from US investors, and will be able to work with global talent in their companies.
12) I would 100% recommend founders come to Silicon Valley for at a few months at least once in their lives to learn how things work. But then you can take that knowledge and networks with you.
13) In conclusion, post-pandemic, we're going to see a LOT of "hybrid US companies" -- companies that are "US companies" by incorporation but the teams are elsewhere, and they are going to do really well.

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More from @dunkhippo33

11 Mar
Thursday thread about focus

As my business partner @shiyankoh likes to say, "Startups die from indigestion not starvation".

Meaning - founders often take on too much at the same time and are not focused on enough.

>>
1) As a startup, it's tempting to want to take on EVERYTHING. New features. New markets. New products. New types of customer personas.

People often think they need to raise a lot of money to tackle all these things.
2) The truth is it's much better to limit the scope of what you're doing.

One customer persona (to start). One simple product that does one thing.

And not much else.
Read 17 tweets
9 Mar
Received a number of requests for this one -- a Tuesday tweet thread about co-founders.

Do you need one? What should you look for? Can you bring in a co-founder later?

Read on >>
1) Let's get some myths out of the way. A lot of VCs don't like to invest in companies w solo founders.

(Not all - @HustleFundVC we invest in a lot of solo founders!)

But the truth is you are not more likely to succeed with or without a co-founder.

techcrunch.com/2016/08/26/co-…
2) But there may be MANY reasons you may want a co-founder. You can:

-Go faster
-Share the weight of company building
-Provide morale for each other

Building a company is hard, and having a great co-founder can help w/ your psychology
Read 15 tweets
9 Mar
A lot of people are always so floored when they hear about a bootstrapped / near bootstrapped company achieving high levels of revenue. How is that possible?

A (very) quick Monday thread >>
1) It's actually WAY MORE COMMON than you think. This shocks other investors when I tell them about these types of companies.

You just don't know / hear about most of these high flying capital efficient businesses. And they're not usually household names.
2) Here's a co I met in Sweden yrs ago and we invested back then w/ my old firm.

The startup is called @Mentimeter - they make interactive software for events and presentations.

They just published their most recent updates today.
Read 6 tweets
7 Mar
Today's Sunday tweet thread is on when to give up on your startup and options for giving up.

This is a topic that I don't think is discussed enough, because founders don't want to think about giving up & investors don't want them to give up.

Read on >>
1) Yesterday I talked about tenacity as a top trait in the most successful entrepreneurs.

I ended by saying, "If this is the path you want to take..." then just keep going, and you'll be successful.

But what if you discover it's not the right path?

2) There are two ways that it could not be the right path.

1) Entrepreneurship in general is not the right path for you.
2) This particular idea / business / team etc -- the details of your current journey -- is not the right path for you.
Read 35 tweets
6 Mar
Some Saturday thoughts about tenacity...

1) Yesterday I had a call w/ a portfolio founder - he was going through really tough times. He was running out of cash & had to let go of a lot of his employees. The pandemic has not been easy for him. His mental health is in a rough spot
2) Today I saw the latest markup on a company I backed in 2015. 76x net paper markup! I could not be happier for that founder & company & was thinking about the two situations.

They're actually more alike than you might think.
3) My past portfolio co, like so many, couldn't raise any money. Didn't have fast growth for 4+ yrs. Had a couple of restarts. Insane scrappiness. Tearful conversations even.

In fact, they retain a lot of equity, BECAUSE no one would back them for so long.
Read 12 tweets
5 Mar
Friday tweet thread about Board Seats.

What are they? Why should you care? Who should have them? How to think about all this as a founder?

thx @zsilvs303 for the suggestion!

Read on >>
1) Whether you realize it or not, your startup has a Board. It's likely just you (and your co-founder).

Your Board is a group of people who oversee governance of the company and look out for the shareholders of your company.
2) When your Board is just you, you're not only the management team running the day-to-day, but you are also the governance of the management team.

This is fine in the beginning, because you also probably own the whole co.
Read 16 tweets

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