Up Early

I’ve always been a natural early riser. Even as a child, I would put myself to bed at sunset and rise at dawn. My parents tried to make this a feature rather than a bug by teaching me to turn on the coffee maker. That didn’t really work out, as the coffee would be all wrong or burned by the time they roused. Perhaps that’s why I never learned to like coffee?

I must also admit there are times when I wish that I could sleep later. My mother put a sign in my room during high school admonishing me for staying out too late (I found a similar one above).  Yes, there are times when I stay up too late and have too much fun when the curse of being an early riser is painful!

The early morning remains my favorite time of day and I’ve come to appreciate this time more as I age. The quiet of dawn, whether sitting near the hearth or (preferably) out in the field, is a time for reflection and anticipation of the future.  It feels like you’re getting ahead of the race.

These quiet moments are hard to steal in our constantly connected world. Whether you’re a night owl or an early bird, I encourage you to find a moment of repose and be grateful for the quiet of that moment.

And if you’re lucky, you’ll then hear the pitter patter of your eldest daughter’s little feet coming to join you as she too has been struck as an early riser…



Acknowledging the grace of this life

I’ve had two of my good friends lose a parent in the last month. One lost a mother unexpectedly to complications of the flu. The other lost his dad today, after a more than 3-year battle with cancer. His note to me was beautiful.  I pretty much tear up every time I read it.

“RIP Dad. Was so nice though. My brother and I at his bedside holding his hands. He started having labored breathing and unresponsive. I told him that my brother and I were both here and that it’s ok to go. He raised his eyebrows, opened his eyes, looked at both of us then took 2 deep breaths and passed. It was so strange…he was definitely holding on for that moment. I feel so lucky”

We are all so lucky to acknowledge the grace of this life. I lost my dad to cancer in October of 1991, he was 46 and I was 17.  I’m now 43 and I can’t imagine that he only had 46 years on this planet.  It weighs heavy on me.

One of the favorite things I heard when my own father died was from a school vice-principal, David Parker. He had just lost his own mother. He said that while you may be sad today and can’t see past the feeling of loss, you’ll come to realize how lucky you were to have him at all. That has become very true for me. I miss my Dad often (and still have a giant hole there) but I know how lucky I was to have him.

None of us can control how long we have on this planet. We all try to bend the odds or do our best to ignore the fact that we all have a certain ending. The passing of my friends’ parents has reminded me that we all need to face that end and live our lives every day in appreciation for the grace of this life.

Sending love, especially to my two old friends.

A Ridiculous Day at Foundry Group

It was one of the most frequently asked questions when we announced me joining Foundry Group. It usually came in the form of a question but was sometimes a statement.  

“Are you going to be in one of those videos?” or “You know, they are definitely going to make you be in a video!”  

Of course, I knew that Jason and the gang had another video in mind. And I knew it would likely be embarrassing and fun all at the same time. However, it’s one thing to consider and accept the notional idea. It’s entirely another experience to actually find yourself singing into a microphone and posing for cameras in silly attire. The last time I participated in something like that was high school. And let’s be honest, I’m really glad those videos never made the jump from VHS.    

It was a ridiculously fun day at Foundry Group. Jason is our creative director and all other roles mixed into one. None of this would happen without him. It takes a lot of work to make this all come together; not least of which is to dream up a song, pull together a video sequence and then make all of us extend ourselves to come up with something legitimate. or at least humorous.

There are a few moments worth calling out. The day started out incredibly cold. We were up on the side of a hill, actually on the roof of Jason’s house.  We each were wearing some sort of gear to sketch out our interests.  I’m glad I was a fly fisherman and not a runner in shorts and tee shirt like Brad!

We then moved into the various sequence and location shots. These all provided some good humor. Boulder really isn’t one of those places where you see a bunch of suits walking down Pearl Street!  Much less with a camera crew and singing into a mic.  

One particular moment that had me shaking my head was to find myself walking down Pearl Street in full cowboy regalia – hat, boots, chaps, spurs, holster and cap gun. Boulder is also not a place that you carry guns, not even cap guns. I was confident however that the Lululemon bag would keep me protected from having to shoot my way out of a hacky sack circle!

I should note that in this moment of walking down Pearl, I realized that my two companions (Micah and Jaclyn) had decided to walk about fifteen feet behind me as if they were not associated with me. Memories of middle school and walking in the mall with my so very uncool mother came flashing back. Now I was the one that these two were distancing themselves from….at least Micah took these pics.

I did at least get to show off the custom FG boots that all the partners received once they brought a Texan into the fold! And if you were wondering, I did already own the chaps.

I would be remiss if I didn’t include this picture of Jaclyn. It appears that she is drinking on the job and, to be fair, it would be completely reasonable given the wig here. Her expression tells you enough about a day like video day at Foundry Group!

And then there’s Jamey. Words leave me.

I’ll part with another link to the video here. And tease you with the idea that we’re already after Jason to come up with the next iteration, one that makes a lot of sense when you look back at the first video.

Thanks to Jason and the gang for a ridiculously fun day at Foundry Group – 


We have just hours. The FCC is about to vote to end net neutrality—breaking the fundamental principle of the open Internet—and only an avalanche of calls to Congress can stop it. So we decided to help “Break the Internet” on our sites. You can also support on TwitterTumblrYoutube or in whatever wild creative way you can to get your audience to contact Congress. That’s how we win. Are you in?

More info here.


Burst Your Bubble

We are spending turkey week down at our family place on Lake Texoma. The house is located in the Red River Valley with rolling hills and Fall colors, the lake, the wildlife, and surrounding topography of rolling hills and forest giving way to farmland. These form a beautiful landscape that is as close to a sense of “home” as any place else for me. I have lots of good memories here and I hope we have many years where we continue to visit.  One benefit of being in this place is that it changes my perspective and “Bursts My Bubble”.

I think it’s really important that all investors get outside their own bubble and see how other people and communities live on a daily basis.  

Our place here is near the communities of Durant, Oklahoma and Denison, Texas right on the border. To give you a sense of scale, Durant has a population of around 16K and Denison is modestly larger at approximately 23K. Each of the towns are lovely in their own ways but it would be hard to describe them as growing and thriving economies. They are hubs for the farming and small business communities with some bleed over from Dallas (45 minutes south). Their demographics skew older with a hollowing out in the middle. Many people are living paycheck-to-paycheck. My family has a number of rent houses in Denison that are left from my grandparents. These are generally low-rent ($300-450 per month) housing stock. Many people struggle to stay in these as their hourly wages leave little room for other necessities. One unexpected car repair or trip to the doctor can mean that they are missing rent or the electricity gets turned off.

Interacting with the local businesses, shopping at the local Wal-Mart, and talking to people can give you a real sense of place. Especially when you’ve been able to do this over many years. Small business, farming, and retail are the mainstays of this economy. Many of the most promising young people in these communities left for Dallas, leaving behind those that are less educated, many with young families they are struggling to support with retail jobs. This is not uncommon in small town America.

If you live in Silicon Valley, Austin, or Boulder with their affluence and prosperity, then you’re probably going to lose touch that much of our country is struggling. If you’re an investor, I encourage you to get outside your bubble several times a year and check-in to see how those outside the tech sector are doing. It will serve you and your companies to have a perspective beyond the echo-chamber of the tech sector.  And you just might find some good memories along the way. 



We’ve spent the last two nights in Fort Worth, Texas.  We stay with my mother when we’re down here, very near the neighborhood where I grew up. We come down to Fort Worth about once a year as we normally visit our lake house a few hours away to see my family. I left Fort Worth in 2001 to move down to Austin for business school; having lived here for the first 27 years of my life. Yet, it still surprises me the sense of nostalgia I get when visiting this town.

I drove by the house where I grew up, the middle school, the railroad tracks, the best friends house. I spent time on TCU’s campus for a meeting. I had lunch at an old haunt in downtown and ordered the same fajitas. Visited some friends in my first office building (which still smells the same). Drove through the now-gentrified neighborhood south of downtown where we used to go eat lunch at the Paris coffee shop. It was funny to have a meeting at a fancy wine-bar there now. Later this morning, I’m seeing a friend and mentor that originally hired me at KPMG for my first “real” job. I’m bringing my girls over to fish on their pond. I’ll see old friends tonight at the TCU vs UT football game and spend time with my parent’s friends that have known me since the beginning.

Fort Worth remains home for me. The place I’m from. That doesn’t mean I don’t love living in Boulder. That doesn’t mean I think Fort Worth is a better place to live or I don’t miss Austin. I don’t have to love one more than the other, they aren’t mutually exclusive. Home is more of a concept, a sense of familiarity, a sense of belonging, much more than a place.

It’s good to be home.  I’ll be wearing purple tonight at the TCU game, cheering for a football team but perhaps I’ll really be cheering being home.

Window Shopping

I’ve got bad news for aspiring fund managers. Fundraising is only getting harder.

I spend a fair amount of time each week connecting with LPs. We may see each other at events and annual meetings, or just set up calls to check in on pipelines and prospects. I’m often trying to get the other LP to focus on some of our Partner Funds that are closing out a fundraise. I want our Partner Funds to have good, supportive LPs and to get back to the work of investing rather than fundraising. In that context, I’m always trying to figure out which, if any, of these LPs have an appetite for new relationships. We are only planning to add a few new names each year as we’ve built out much of the Partner Fund portfolio. I also see our friends at Cendana and Greenspring adding a few seed relationships as they are focused on seed and/or have raised dedicated fund of funds for seed managers. We would welcome more dedicated fund of funds or traditional LPs to join us.

The bad news is that I don’t know a traditional institutional LP that is still looking to build out its seed portfolio. We maintain a long list of LPs that we’ve seen show up in seed funds and have relationships with many of them. The consistent message in all my interactions of late has been a lack of interest or appetite for new relationships. I’m hoping that many of these LPs have just exhausted their annual commitment budgets but I’m afraid it’s something more than that.  

Many of the generalist FoFs and more active traditional LPs have filled their portfolios and will decide to re-up here and there but not add a lot of new exposure. There has been almost no liquidity, and other institutional LPs are dealing with larger funds coming back to market more quickly with little capital/bandwidth left for a seed portfolio. A lot of the individuals and family offices are tapped out after several funds and may have committed more than they intended to a very illiquid part of the asset class.

It’s not a pretty answer for new managers setting out to raise funds. Most LPs are still game to take meetings, especially when you can get another GP or LP to refer you into them. New managers should chase all those meetings and show up in person whenever possible.

However, it feels like many LPs are simply window shopping with no real appetite for making new commitments. We do see the occasional commitment that looks like a spontaneous purchase. We find it really hard to predict these purchases or to know where to point fund managers. We will sometimes see a new LP that hasn’t traditionally done seed VC show up and pull the trigger on a new fund. We’re seeing these from the smaller endowment and foundation crowd these days.

It seems even harder for funds under $50 million, as traditional LPs can’t even really look at these, and only a few FoFs will play in this range. These are getting filled out by family offices with perhaps less than two institutions playing along. Oddly, the smallest funds may be the hardest to raise. Funds less than $25 million are stuck in friends and family territory with individuals, a few family offices, and the GPs at hedge funds, large PE and VC firms as fundraising targets. I struggle with how to help these small funds and where to point them for capital.

Maybe we have enough seed funds already? It certainly feels that way in certain ecosystems. Maybe this is the system beginning to self-govern? We actively support more fund formation, and we’re excited about the explosion of new companies that seed managers are chasing. Part of the Startup Communities and Techstars message is that great companies can be formed anywhere and local capital needs to be grown over time. We can only hope that the market is somewhat rational, funding the right managers that are additive to the system.

I’ll close by wishing all the GPs speed and certainty in closing their funds, even if we can’t invest in all the good ones.  And if you’re an LP that wants to do more than window shop, call me to see what I’m looking at and where I’m investing.

Saying “No” too often is part of being a good investor


One of my favorite comments about our Partner Fund portfolio came from a well-known VC at a high-flying fund. She noted that we get to work with “all the good people in venture.” I suppose people are the price of admission for our family. However, we can’t invest in “ALL the good people in venture.”

We plan to invest in roughly 30 total Partner Funds for our current portfolio. We’ve disclosed 15 of those and we have five more in various stages of closing right now. We’ve known some of the funds for years, while others came to us early in their life as they formed a team and strategy. There are another five that we’ve been working with and holding a spot for as they come back to market. That leaves us just a few slots for consideration over the next year.

We start with something we call the “good human” filter. We then look for those opportunities where their strengths match their strategy and fund size. The nuance of balancing these mostly qualitative characteristics is the hard part of getting our Partner Funds strategy right.  

The explosion of fund formation over the last few years and our view into that expanding market has presented us with a wealth of opportunities far beyond our fund size and capacity. We decline quality funds multiple times a week where we know they are “our kind of people” and have a compelling strategy. We wish we could be more prolific, but in these cases we try to give some real feedback and be transparent in our process and decision making. We do our best to make time for good people and hope that we can provide support, if not capital to many of these.

Unfortunately, we have to say “No” far more often than we get to say “Yes”. It is part of being an investor and forces good discipline into the strategy we’ve designed for ourselves. However, we are certainly missing the opportunity to partner with some great firms and good people.  

With so much negativity in the media around our industry, we are glad to see so many “good people” in venture.

Mi Casa Es Su Casa – How we seek to interact with our family of GPs

As we share more about our fund investment thesis on the Foundry Group blog, I also wanted to give more transparency for how we interact with our GPs and how we aspire to help them. I’ve shared the text below from an email that we sent out earlier this year. I hope this provides a window into the form of interaction and collaboration we want to have with our friends and partners. We feel like we have a responsibility to #GiveFirst and act according to a Code of Conduct as LPs. We welcome transparency to the LP world with the #OpenLP movement and I hope we can be leaders in the push to bring this part of the ecosystem into the light.  – LE


“Greetings FG Next Partners,

We hope you’re having a great beginning to 2017! Last year was an incredible start for Foundry Group Next. We raised the fund, transplanted a Texan, poached Jaclyn from the glory of big law, and, most importantly, we partnered with 10 great fund managers. We’re appreciative and excited to be working with such an awesome group of GPs and to welcome a few new ones in 2017.

Internally, we refer to our team as a family and our portfolio companies often refer to each other as cousins. We like to think of you as part of that extended family so in our vernacular your portfolio companies are second cousins. Taken together, this creates a meaningful extended network of exciting companies. While we believe that all partnerships and cross-selling should occur organically, we want to encourage this within the ecosystem and are looking for ways for the whole family to engage with and support each other. We’d love to hear any ideas or suggestions.

As we begin 2017, we wanted to touch base with all of you to introduce several new FG Next initiatives we’re rolling out. We welcome your feedback and are open to suggestions. As always, we’re here if you need us.


Team Foundry Group Next


Slack Channel. As we mentioned, this is an awesome group of GPs. We want you to get to know and learn from each other. You will be receiving an invite to an FG Next GP Slack channel. We encourage you to use the channel to communicate with and support each other the same way your CEOs use the communication channels many of you have created. Use cases might include:

    • Service provider referrals and reviews;
    • Connections to downstream investors;
    • Sharing networks and industry knowledge; and
    • Talent referrals.

While we know that you will occasionally find yourselves in competitive situations, we love to see several of our funds invest in the same company – we see this as a positive signal and are not concerned with diversification risk. We hope this will be an active channel, and we’ll seed it with some questions of our own.

We’re invoking circle of trust/cone of silence, so everything on the channel will remain confidential and only Foundry Group and FG Next GPs will have access. We’ll circulate a list of everyone on the channel so you know who you’re talking to and will announce new GPs as they join the family.

Data Collection and Polling. When asked what we can do to be helpful, many of you responded with “data on X, Y, Z.” We’d like to compile data on various aspects of venture and startups including, LPs interested in venture, compensation (for both companies and funds), financing terms, market trends, and service providers. As you are one of our greatest resources, we may tap your insights using periodic email polls.

Group Discounts. We’ve already rolled out eShares (a big thanks to those of you who have signed up). They’ve agreed to waive the setup fee for our Foundry family. We’re looking into other opportunities to obtain bundled services or discounts for our GPs.

Insider LP/Mentor GP. Part of the goal and purpose of our fund is to bring the entire ecosystem together and interact with you in a different way than traditional LPs. We encourage you to leverage our partnership in the following ways:

    • Fundraising: LP introductions; deck review and pitch practice.
    • LP Relations: LP communications/messaging advice; annual meeting prep.
    • Operations/Strategy: thinking through strategy– fund size, portfolio construction, team, growth, transitions, etc; sourcing/interviewing/vetting potential hires.

Brad, Jason, Seth, and Ryan are available in these ways, as LPs, but can also be supportive as GPs that have been in your shoes. They can weigh in on deal dynamics, specific investors, industry-specific issues, growing pains (for the GP and portfolio companies), founder drama, board structure (and drama).

Mi Casa es Su Casa. We have a great office here in Boulder. Please feel free to hold your off-sites here; Brad also has a retreat center at his house 30 minutes outside of Boulder that is free to use. It’s a great way for us all to get exposure to our broader teams. Boulder is a perfect place to get away from the noise and enjoy the outdoors in a low-key setting. Groups have done a half-day in the office, half-day outside playing, followed by dinner with those of us who are in town to rehash the day. Whatever works for you, we’d love to host!

Best Practices. We’re working on putting together some best practices docs for you–  e.g. must-haves in a pitch deck, LP-friendly reporting, and annual meeting guidelines.

GP References and Referrals. This is more of an ask. As we consider adding new managers to the family, we’d love to get your thoughts, as many of you have worked with our prospective GPs. We’ll send out periodic emails with a list of funds in our pipeline and welcome feedback from those of you who know these GPs well. Cone of silence applies, so you don’t have to worry about your comments getting back to your friends (or foes, as the case may be). We also welcome referrals to your GP friends who might be a good fit for us or would like a friendly LP’s perspective.

Family Dinners. We’d like to get the gang together for a few GP dinners this year. Not to start another East Coast v. West Coast battle, but we’ll probably do one in the Bay Area and one in New York or Boston to make it convenient for you. Jaclyn will follow up with you to identify some dates that would work.

Quarterly Calls. We’ve already got the ball rolling on this one and appreciate you working with us to get these scheduled. Some of you have requested monthly calls– big smiles on our end but we won’t force it on the rest of you. The purpose of these calls is to check in to see how you’re doing and if you need anything from us. We would also like to do a quick review of your portfolio and identify any potential direct deals we should have on our radar. Here’s a description of the types of deals that are a fit for FG Next. We’re always game to talk to founders about later stage fund-raising, even if they’re not currently in fundraising mode. We can also play matchmaker for Series A deals for our early stage fund.”

Venture Risk and Return circa 2017

I put the below note in an email to a friend a few weeks back and I find it’s something I’ve been thinking about and saying over the last year. I figure I might as well be on the record for it!

VC formation is only following and responding to company formation. There has been an explosion of companies and now the same explosion in fund formation. We continue to see company formation accelerate as friction and capital needs are removed from the system. VC is undergoing a similar explosion of funds and managers as the barrier to entry has been lowered (meaning you need less capital) and micro-networks of entrepreneurs are beginning to support each other’s success, sometimes with the benefit of these smaller pools of outside capital. We call them pre-seed, micro-vcs or some other new term but I really see them as a reflection of the changing company formation landscape. Brand and differentiation remain most important at any stage of VC, where the entrepreneur is really the customer. As a VC, you’re vying to attract the right customers at the right price point. They are attracted to brand and success of fellow portfolio companies.

I also firmly believe that definition creep has happened up the scale of rounds. Seed is the old A, pre-seed is the old seed, and B/C rounds are now growth? These multiple rounds remind me of the old milestone rounds where you get more risk decision points. A rounds aren’t as risky as even 5 years ago (and crazy different than 1999) due to previous funding and company progress, plus many types of technology investments get data earlier, provide feedback on whether to continue funding and consume less capital overall to get to profitability. Shorter way to say that is to suggest that upside remains in early stage but should be lower capital loss ratios than prior periods. I don’t think most LPs have figured out that the risk curve may have shifted.  Instead, they probably feel like they are being swarmed and find themselves overwhelmed.

Traditional LPs are seeing the returns from venture and they aren’t sure how to play or what to make of these returns, with many suggesting a bubble will bring all these companies back down to earth. There is no doubt that economic cycles matter and funding will decrease causing some pain. Erik Rannala from Mucker Capital recently had a really interesting take on technological revolutions that provide a big picture view of these cycles that made me think hard about my own views. Worth a read. Nonetheless, we know cycles happen and I don’t expect that to change. That said, I do think the risk curve has shifted meaningfully and you will continue to see early stage venture returns as the most attractive place to deploy risk capital.  I certainly voted with my feet!