Checking On Predictions & Fantasy VC Portfolios

On June 8th, 2017 I made a list of 20 companies that looked ripe for Series A… it has been nearly 4 months and I just checked to see how my predictions are going. 1 out of the 20 has announced their Series A so far: ClearMetal announced a $9M Series A from Innovation Endeavors and Prelude Ventures.

I love to publish picks and then see what happens, and back in February 2014 I shared my fantasy VC portfolio of 7 companies, and then updated it in February 2015 showing a nearly 9.1x* increase in total funding (*excluding the Uber pick) from my initial selection. This group is now at 14x* total funding since my initial selection date, with 2 exits.

Ugh, nothing like embedding a Google Docs spreadsheet to make me wish I was still working on GitSheet!

I’ve made enough different prediction posts at this point, not to mention actual investments, where it seems like a good idea to start wrangling them all into one place. Eventually, one spreadsheet. But for now, let’s continue to time travel…

In June 2013 I flagged 10 Pre Series A Companies to Watch in New York, which included my initial call for Digital Ocean (who had not yet announced any outside funding). Of these companies, 3 raised a Series A, 3 were acquired, 2 shut down, and 2 are still going strong.

To be continued… there are definitely more of these posts hanging around.

 

 

 

What Does It Feel Like to Be Married Cofounders?

when my light’s burn out
you’re the only one, you’re the only one
you’re the only one left
I will answer to
when my lights burn out
you’re the only one, you’re the only one
you’re the only one here
who can switch out the dud

honey you’re a patient man
living in the moment
everything I am is not everything you wanted but
here we are side-by-side in bed every single morning
I am old

you can’t keep my pace
and you can’t see the flash beneath my veins
but you’ve got time for days
to watch me drift, and sink and swim in a hundred different ways

when my lights burn out
you’re the only one, you’re the only one
you’re the only one left
I will answer to
when my lights burn out
you’re the only one, you’re the only one
you’re the only one here
who can switch out the dud

honey you’re a patient man
living in the moment
everything I am is not everything you wanted but
here we are side-by-side in bed every single morning
I am old

you can’t keep my pace
and you can’t see the flash beneath my veins
but you’ve got time for days
to watch me drift, and sink and swim in a hundred different ways

when my lights burn out
you’re the only one, you’re the only one
you’re the only one left I will answer to

20 Bay Area Startups Ripe for a Series A Investment

It’s been a couple years since we shifted our product development focus at Mattermark to supporting sales and marketing deal sourcing, but that doesn’t mean I’ve lost my love for speculating on which startups are most likely to raise funding next.

Living in San Francisco these past 8 years, I’ve noticed there are often companies that appear seemingly out of the blue and then raise a boatload of money. This was part of what inspired me to start Mattermark in the first place. Can we detect these companies earlier if we were paying closer attention to data exhaust they produce? If we were watching the web traffic, social media, mobile app downloads, and other signals around companies climb – even from super small numbers at first – could the slope of that growth tell us something about what a hot emerging company looks like in it’s earliest days.

I’ve spent over 4 years working on exploring these questions now, and it’s endlessly fascinating. Without further ado, here’s my list of Bay Area startups who haven’t announced a Series A funding round yet but should be on every venture capitalists shortlist:

This list is influenced by growth signals found in Mattermark (which is how I built my initial screen, as explained below) and then editorialized by me, based on a combination of what I think is interesting, trendy, backed back other investors with a track record of getting their seed investments graduated to the next stage. If you feel like your company should have been on this list just go raise a Series A, and prove me wrong!

Like this comic? Steve Hanov’s blog has a bunch more!

How I Built My Initial Screen

Mattermark has ~3K companies tagged with Bay Area and “Pre Series A”, which means they’ve raised some funding by not a Series A. When we increase this filter to also include all Bay Area companies with no known funding (like unannounced seed rounds) that number jumps to ~40K.

I wrote a Series A benchmarking analysis in January 2015 that determined the average Series A deal is announced when a company is at ~15 employees. I paid attention to companies approaching this size for my selection criteria, and also made sure the net team size had increased at least 1% over the past 6 months.

I’ve raised more than $18 million in funding for my company through several rounds, and I can confirm the rule of thumb that a company raises seed funding to last them 18+ months. Knowing this, I focused on companies who had gone at least 9 months since their funding announcement. With all these criteria applied, I’d already whittled the list down to just 477 companies (and yes if you click this link and sign up it is totally free to view it!). Btw, if you save this search with a name like “hot series A opportunities” Mattermark will automatically email you whenever a new company meets this criteria. This is exactly how the most data driven top tier VC firms in the business use us!

I realized after I wrote this that I had not placed an upper bound on months since last funding, and I didn’t want to get a lot of old dead companies in my list. So I put 24 months since last funding announcement as my maximum. Down to just 167 companies.