“In The Studio,” Bullpen Capital Anticipated Todays Series A Crunch Years Ago

Editor’s Note: Semil Shah is an EIR with Javelin Venture Partners and has been a contributor to TechCrunch since January 2011. You can follow him on Twitter at @semil.

“In the Studio” welcomes it’s first two-guest show ever by hosting two long-time Valley veterans, former founders, investors, seed fund LPs, and executives who, most recently, had the presence of mind to anticipate an investment trend and build an entire investment business around it, ahead of the curve.

For Paul Martino and Rich Melmon, both managing directors at Bullpen Capital (along with co-founder Duncan Davidson), all the recent chatter about “The Series A Crunch” validates their initial thesis from three years ago. Back in 2009, the folks at Bullpen saw the delta between the number of seed deals and Series A checks growing, largely because more companies were getting funded. With the hint of an idea for a new fund, Martin, Melmon, and Davidson quickly formed Bullpen and, unlike many talking heads opining on the Series A crunch now, went and put their money and reputations where their mouths were. [And, just this week, Bullpen released a new report with new data called “The Series A Cliff,” which can be downloaded here.]

Typically on “In The Studio,” the content isn’t so timely, but it just so happened that I invited Martino and Melmon a few months back, and this discussion is well-timed given the current early-stage investment climate. In this video, the Bullpen folks explain what they’re looking for — seed-funded companies that have product-market fit and an operational plan to get to Series A. Martino and Melmon also reflect a bit on how the locus of entrepreneurial activity in the Valley has shifted north to San Francisco in this cycle, and how the rise of YC and lean investing perfectly coincided with the time when larger venture firms may have raised too much money.