Tandem, which recently raised a $100 million fund to back mobile startups, has added two new partners — Shashi Seth, formerly an executive at Google and Yahoo, and Couchsurfing co-founder Daniel Hoffer.
The firm says it now has 15 team members working with its portfolio companies. It invests $200,000 initially and hosts those startups in Tandem’s Burlingame, Calif., office for six months.
That might sound like a startup incubator or accelerator to you, and indeed, that’s how we’ve been describing it, but in a recent blog post, Tandem explains why it now positions itself as a mobile seed fund:
We opted for the “seed fund” category as a more accurate description of the Tandem model. Seed funds invest at early stages and reserve substantial follow-on capital for subsequent financings. But it’s important to note that Tandem is still unique even among seed funds in several key ways. First, unlike Tandem, most seed funds don’t work closely on their portfolio company businesses; they are managed by fairly small teams and invest in many startups to end up with a broad portfolio of potential winners.
Second, it’s common parlance that seed rounds are now thought of as the “new Series A,” often reaching $3-4M in size and following “angel” or “pre-seed” rounds in companies that have since hit significant milestones. Tandem, in contrast, invests in companies before they have proven product-market fit (and gets intimately involved in helping them discover it). While some may consider this stage to be “pre-seed,” we felt the concept of “pre-seed” to be confusing. Does anything come before the seed in other ecosystems? Raw dirt perhaps?