December 10, 2013
Seed stage capital is a commodity. AngelList, the seed funding boom, the rise of the MicroVC and any number of other phenomena are ensuring this. And entrepreneurs are getting smart about it.
Historically, the seed stage VC game has centered around simply picking companies. Actually helping them to operate – and by that I mean really, genuinely impacting operations, is an afterthought. With only a few exceptions, investing in genuine operational support for portfolio companies is written off because resources are limited at smaller funds and incentives and human nature lead to a focus on hunting down the next deal.
As a result, most seed stage investors remind us of seventeenth century physicians – the one-stop-shop for all your medical needs who was a jack of all ailments, but master of none. That physician of old would deal with whatever walked in the door – broken bones, the plague, a burst appendix, or a premature birth – and know that he was the last line of defense. He knew what he knew, made up the rest, and hoped for the best, as he was the only option around.
Sound familiar? That’s the classic seed stage VC – a tiny bit smart about a lot, but woefully ill-equipped to have any real impact on most operational issues. Trust me, I know…I spent too many years living this model myself.
At High Peaks, we are working hard to re-think the seed stage venture model. Our goal is to be less Renaissance era doc and more 21st century, big city general practitioner. We think we’re pretty damn good at what we do, but we know we don’t have the experience to go all that deep on most tactical issues. Fortunately, unlike many, we don’t try to, either. Rather, we excel at preventive care (helping the teams we work with to see the forest and think constantly about goals, metrics, and the ecosystems in which they operate) and stay engaged enough to work with CEOs to diagnose operational issues early. Increasingly, then, we refer out to a true specialist.
To that end, today we’re excited to formally announce the start of our family of “specialists”, the High Peaks Operating Partner Network (“OPN”). The OPN is a collection of incredibly successful operators and, importantly, tactical experts. Hailing from leading NYC companies like Seamless, Gilt, SinglePlatform, Quidsi, and Medidata, these operators have, collectively amongst them, deep knowledge in just about every functional area that our SaaS and Ecommerce companies wrestle with. When a portfolio company has symptoms that need to be addressed, they’re on call, capable of suggesting a remedy and often available to advise the company on an extended basis.
Unlike the classic Advisory Board model, which gets the biggest, sexiest, most impressive CEO names possible and then puts them on a website while they never contribute much (yep, we’ve been guilty of that one!), we’re focused on true expertise in critical functional areas – the folks who are actually doing the dirty work in areas like inside sales operations, search engine optimization, account management, etc. These folks know their stuff, and our companies are reaping the benefits of that expertise by working with them.
We are singularly focused on continuing to build a platform of operational assets that will support entrepreneurs. The OPN (have a look at our initial group here) is the first piece of a puzzle on which we will be sharing more details in the coming months. Stay tuned.