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Fundraising 101: Do VC associates matter?
There are hundreds of associates working at VC firms traipsing through meetups and coffee meetings trying to find the best new startups. If you are looking to fundraise though — and fundraise quickly — how do you approach these nebulous non-check-writers?
This week, I wrote a guide based on my experience as a VC associate at two firms. The answer is that yes, they can matter, and it usually is quickly apparent how valuable they can be.
Associates can be helpful, they can and should be nice, and they have a useful role to play in the venture landscape. But let’s be clear: they can’t write checks, and checks is what you are looking for. They can be useful mechanisms to get the right meetings with the right partners at exactly the moment you are ready to fundraise. You probably shouldn’t piss them off by being an asshole to them, but at the end of the day, they are not the decision-maker. And if you learn anything about sales, it is that you want to pitch the person that holds the purse strings.
What top VCs look for in women’s fertility startups
Women’s fertility is a major area of investment for VC firms these days, and several prominent investors are doing deep dives into the space. Our healthtech writer Sarah Buhr interviewed several VCs about what they’re seeing in the space and why fertility is suddenly in the limelight:
Sarah Cone of Social Impact Capital: We’re interested in companies that create large data sets in women’s health and fertility, enabling personalized medicine, clinical trial virtualization, better patient outcomes, and the application of modern AI/ML techniques to generate hypotheses that discover new targets and molecules.
Historically, women’s health is a huge but underserved market. The main reason is the lack of investment in R&D. Out of the top 25 pharma companies, only 7 have women’s health pipelines, and out of those 7, the average number of drugs in the pipeline is less than 2. Additionally, federal research spending is a laughably small number (for example in 2015, 0.023% of NIH grants went to women’s health research.)
The future of car ownership: Building an online dealership
Meanwhile, huge VC investments over the past few years has led to a crop of high-flying startups targeting the online used car market. TechCrunch’s automotive expert and senior editor Matt Burns takes a look at the current state of the market and its leaders Carvana, Shift, and Vroom, how incumbents like CarMax are competing, and what the lessons are from Beepi’s flame out. This is part one of a two-part series.
Shift has distinct differences with Carvana. Shift allows vehicles up to 10 years old on its platform whereas Carvana focuses on cars less than four years old. Because of this, Shift’s marketplace has a greater variety in price and quality as the vehicles can be older and have up to 120,000 miles on the odometer.
“Our model is really online to offline,” Shift CEO and co-founder George Arison said to TechCrunch, noting that with Shift, buyers get a test drive before committing to the vehicle. That means Shift users do not buy a vehicle on its site; they order a test drive. The purchase comes after the shopper drives the car. Arison said 70% of its purchases are on the spot during the test drive.
And one interesting note I loved about CarMax:
According to a May 2018 report by Automotive News, CarMax leads the used-car market in volume, profits and margins. Despite this dominance and its 203 dealerships, it only accounts for 2% of all used car sales. CarMax’s stock is up 20% on the year and racing towards an all-time high.
Dissecting value systems and exclusion in ‘big tech’, with Jessica Powell (Part Two)
Our resident tech ethicist Greg Epstein published the second part of his two-part conversation with Jessica Powell, who formerly headed PR for Google and has since become a tech novelist (in addition to many other activities). Part one of the interview explored her background and why she worked on the novel, and this new conversation looks at the current challenges facing Silicon Valley:
Jessica: What’s unique about the Valley, and quite admirable, is the entrepreneurialism; this attitude of asking big questions and “why not?” But when you feel you can ask anything and do anything, you don’t always contemplate the consequences of the things you’re building. I’m sure when Jack Dorsey built Twitter, he wasn’t thinking it would look like the cesspool that it does today.
Many of us, if we had ended up in the same positions as some of these founders have, might well have [had] the same problems. I do not think that these people are horrible people, that if there had just been someone else in power, that we wouldn’t be having the same conversation.
AI security startup Darktrace’s CEO defeats buzzword bingo with trust and transparency
Our security editor Zack Whittaker has been interviewing top cybersecurity CEOs to find what drives the success of these companies and what we can learn from their experience. This week, he interviewed Nicole Eagan at Darktrace, a networking monitoring startup that has now grown to nearly 1,000 employees.
About a quarter of its customers are in financial services, said Eagan. But it takes a lot for the heavily regulated companies to trust a mystery device on a company’s network where the data and security, like financial services, is highly regulated.
Although its technology is proprietary, Eagan said transparency is key.
“If you build something that actually works the way you say it does, especially in the security market — where there’s a lot of products that have failed — it makes it makes a tremendous difference,” she said.
‘This is Your Life in Silicon Valley’: Philz Coffee CEO Jacob Jaber discusses tech culture and Blue Bottle
We occasionally offer transcripts of podcast shows to Extra Crunch members as a way to connect you to interesting content outside of the TechCrunch walls. In this episode of This is Your Life in Silicon Valley, Philz Coffee CEO Jacob Jaber talks about his company and its growth with host Jascha Kaykas-Wolff, while also attempting to convince our very own Kate Clark that Philz beats Starbucks (Kate remains skeptical).
Sunil Rajaraman: Ritual, who we’ve had Ilene on the podcast as well, Blue Bottle was acquired by Nestle of course. I want your take on the Nestle Blue Bottle acquisition, and can Philz realistically remain independent?
Jacob Jaber: Yeah, I don’t know much about the relationship or the level of engagement, so I can’t speak too much to that, but generally speaking, what you’re seeing is the rise of the artisans. People who are passionate about product and having the entrepreneurial courage to start a business and create something. I think that’s a wonderful thing.
There are countless options of terrific coffee, and food, and beer in the city and many other cities. I think that the key for Philz is that, how do we celebrate artisanship and quality in a way that’s accessible and approachable and welcoming for everybody.
Verified Expert Growth Marketing Agency: Growth Pilots
Yvonne Leow continues our growth marketing Verified Experts series, this time with a profile on Growth Pilots and its founder Soso Sazesh, which has worked on paid ad strategies with startups like Instacart, Gusto, and Betterment and more than 100 others.
Yvonne Leow: What were some of your greatest lessons learned when you started Growth Pilots?
Soso Sazesh: In the early days of Growth Pilots, there was so much activity and growth that we ignored important things like team infrastructure and people operations. We saw the effects of this in the form of team morale taking a hit and people not seeing a future with us. We eventually took notice and course corrected by investing heavily in people operations and employee development. In an ideal world, we would have done this much earlier.
Another interesting reflection is how critical the work we do is. I think this is what a lot of agencies get wrong. You need the commitment to work with startups. You can’t be one foot in and one foot out when a company may live or die by the work you are doing. A lot of the companies that we work with explicitly outline what goals they need to hit in order to raise their next round of funding and it becomes very clear what part we play in that.
With Tableau and Mulesoft, Salesforce gains full view of enterprise data
Finally, the big deal news this week is that Salesforce announced a $15.7 billion acquisition of data analysis platform Tableau. Our enterprise reporter Ron Miller discusses what Tableau and Salesforce’s earlier acquisition of Mulesoft means for the future of the CRM cloud company:
Laurie McCabe, co-founder and analyst at SMB Group, sees this as helping not just Mulesoft, but also bringing together the many disparate pieces Salesforce has bought over the years. “Salesforce has acquired a lot of different products over the years. Its customers also use a lot of other business software solutions. Tableau can provide one analytics interface across all these different products to help customers see what’s going on in a more comprehensive way across different parts of their businesses,” she told TechCrunch.
Thanks
To every member of Extra Crunch: thank you. You allow us to get off the ad-laden media churn conveyor belt and spend quality time on amazing ideas, people, and companies. If I can ever be of assistance, hit reply, or send an email to danny@techcrunch.com.