I have a confession.

I’ve become more cynical about startups this year. I catch myself in pitch meetings building the case for why a company won’t work vs. why it will. It’s hard to find positivity when there’s so much noise in the market.

It’s easier now to build than ever before and so many people are faking their way into raising VC funding. There’s so many copycats. 

So many businesses that have no staying power. So many businesses who have no reason to exist, built by people who know how to play the fundraising game. So many people are raising money for the sake of raising money.

I don’t like that I’ve become more cynical and want that to change. So I wrote down what still gets me excited…

What excites me is finding people who are strengthened by struggle. People who are resilient. People who don’t give up.

We look for builders with a certain type of mindset. One where they prove conviction in their hypothesis with rigor around customer discovery. They build an MVP before asking investors to have conviction. 

(It’s easier for investors to have conviction when there is an MVP anyway).

We used to invest at the idea stage, but today’s pre-seed looks different than it did in the past. We’re investing in distribution (it’s more important than ever before), not R&D. Obviously, this doesn’t apply to certain industries and products, but is true for the majority. 

There is no excuse for not having that rigor. At least, no valid one.

Your pedigree doesn’t matter.

Even if you have had an exit, you shouldn’t need to care about needing VC funding to take what you’re building seriously. 

You shouldn’t want VC dollars until you’ve achieved signals that put you in a position to optimize for fundraising speed and terms anyway.

And yes, VC is all about the people. But, if investing was as easy as finding every founder who has exited a company and giving them money, my job would be way easier. I could do that all day. 

Pedigree is very hit or miss. The data doesn’t really lean one way or another on whether pedigree drives stronger returns. 

According to Antler, around 40% of unicorn founders are repeat entrepreneurs. That means most billion-dollar companies are built by people doing it for the first time.

And for founders whose first startup failed? According to Harvard Business School, they succeed at almost the same rate as first-timers (23% vs. 22%).

What's unique is someone who has perspective, the secret about a problem, and the hustle to build it.

From a historical perspective, there have been themes of struggle that lead to unicorn outcomes. Whether that’s the midwest/immigrant roots, athletes, poverty, or health issues, going through a journey of struggle prepares someone for the roller coaster ride that is building a startup.

And more specifically, it’s how they approach those things. These were stepping stones that made them stronger. (Kelly Clarkson has been saying this for years now!)

Again, it’s how you approach struggle, not that you’ve just experienced it.

Oh, you’ve experienced struggle? Congratulations, as has every human.  

Of course there is more to the crazy formula of a successful startup journey. So many things have to align across timing, team, tailwinds, etc.

But we know that one thing will always help. A founder who looks struggle in the eye and smiles.

If that’s you, I’d love for you to pitch us. Please, make me less cynical.