New York City seed investors are growing up, and raising bigger funds. IA Ventures just raised $105 million and ff Venture Capital closed its second $27 million fund last November (which I am reporting here for the first time). I asked ff VC’s John Frankel and David Teten to come into the TCTV studio to talk about the new fund and their approach to investing. Their first $6.3 million fund, which they raised in 2008, was the top-performing venture fund through the end of 2010, according to Preqin, with a net IRR in the high-40 percent range, says Frankel.
The new fund,which they raised over the course of a year, has already deployed capital to 23 startups, including Klout, ThinkNear, Livefyre, Voxy, and Kohort. The fund will stop investing in new companies at around 30, which it should hit by the end of this year. The rest of the capital will be reserved for follow-on rounds. The only way to get outperforming returns, believes Frankel, is to stay focussed. Frankel was an angel investor and before that worked at Goldman Sachs. Angel investing saved him from the Street, much like it did Roger Ehrenberg at IA Ventures. (In addition to Teten, Hashable CEO and Quigo founder Michael Yavonditte is a part-time venture partner at ff, which stands for “Founder Friendly”.)
If you look at their portfolio, there are a lot of data, analytics, and consumer Internet plays, but they always invest in the entrepreneur first. “We don’t think about the world by themes.” says Teten. “Our approach is the people who know the most about growth sectors are the entrepreneurs.” Adds Frankel: “Our teams drive our themes.”
In the video, we get into why ff invested early in Klout, among other topics. “A lot of people saw it as a Twitter analytics company,” says Frankel, who sits on Klout’s board. “We saw it as a way for people to manage their online footprint.”
ff Venture Capital (ffvc.com) is an institutional venture capital investor in seed-stage companies. Since 1999, our Partners have made over 160 investments in over 55 companies. Our exits include Cornerstone OnDemand (IPO, CSOD) and Quigo Technologies (sold to AOL for a reported $340m). ffVC has a dozen employees based in New York and New Jersey and extensive resources dedicated to portfolio acceleration, including strategy consulting, an experienced mentor network, recruiting assistance, a pool of preferred service providers,...
John Frankel has been an early-stage venture investor since 1999. Mr. Frankel was one of the earliest investors in Quigo Technologies, which was purchased by AOL in December 2007, and in Cornerstone OnDemand (CSOD on NASDAQ) which had a successful IPO in March 2011. He has also served and/or now serves on the boards of 500px, Centzy, ClearPath Immigration, Infochimps, Interaxon, Media Gobbler, Klout, Parse.ly, Phone.com, Quigo Technologies, The Goldman Sachs Trust Company, and Voxy. He is also...
David Teten is a Partner with ff Venture Capital and Founder and Chairman of Harvard Business School Alumni Angels of Greater New York. He is cofounder of the Venture Capital Access Program, which helps women and minority entrepreneurs raise venture capital from members of the HBS Alumni Angels network. David is a board member of Social Fortress and a Mentor with Founder Institute in New York and Singapore, Dreamit Ventures, Entrepreneurs Roundtable Accelerator, Lean Startup Machine, and Startup Leadership...
Klout measures influence based on the ability to drive action across the social web. Any person can connect their social network accounts and Klout will generate a score on a scale of 1-100 that represents their ability to engage other people and inspire social actions. Klout enables everyone to gain insights that help them better understand how they influence others. Klout also provides people with opportunities to shape and be recognized for their influence.
Livefyre brings the social web experience to any publisher or brand site to drive real-time conversations and community engagement. Livefyre’s suite of real-time products drastically increases time spent on publisher content, participation, and return visits. Livefyre products include its free community platform which replaces outdated commenting sections with real-time social conversations, and its enterprise solution StreamHub. Livefyre’s StreamHub allows site owners and editors to easily curate the entire social web and incorporate it into their site alongside their...
Voxy is the only language learning program that is based 100% on your real-life daily activities. By using mobile technology and gaming mechanics, Voxy turns the media that you consume, the conversations that you have, and the activities you do into powerful contextual language lessons that are available anytime, anywhere. Voxy is currently focused on teaching English to Spanish and Portuguese speakers, but is rapidly expanding into new markets and new languages to reach the billions of...
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