Last week I attended the 9th Annual Spartina Offsite – a two-day retreat hosted by David Hehman and Howard Love. I have known and worked with David and Howard for almost two decades, having first met David in the mid 90’s when he was fresh out of Berkeley and starting his first successful startup, HealthDesk. Through David, I met and started working with Howard as well. And, over time the three of us have worked together supporting and co-investing in an assortment of startups. Our first “liquidity event” came from an investment in a startup called Mongo Music (which MSFT bought in 1999), and we have had the good fortune of enjoying seed investments in OpenTable, Trulia, Hotel Tonight, among others.
“Spartina” is an umbrella under which Howard and David house the investments they co-fund. And, with a portfolio of dozens of companies, the agenda for the retreat included hourly sessions allocated to each founder/CEO during which each company gave a brief update, and then posited one significant business challenge for the group to discuss. Mind candy! And, the conversations this year were incredibly frank, candid and illuminating.
In any event, one of the more memorable conversations involved the market for that “second infusion” of early-stage capital. Keep in mind that all of the attendees have already raised some seed capital. But, the bulk are facing the need to raise a new round over the next 12-24 months. So, our conversations centered around raising that second chunk of funding.
To start, we discussed the clear shift over the past decade by traditional VC funds toward later staged investments. Series B is the new Series A after all! So, we discussed where early-stage entrepreneurs find that second infusion of capital to help fuel that critical stage of market penetration and expansion.
Manu Kumar of K-9 Ventures ( Continue reading