VC Marketing—Bold Examples Beyond Content

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With more than 450 VC firms and 225,000 angels in the US, differentiation is key to obtaining a high quality deal flow, closing deals and securing funds from LPs. Sure, a firm’s reputation, thesis, connections and term sheets are incredibly important, but an effective marketing* strategy can significantly bolster each of these qualities and help a firm standout from the rest. 

Recently, we’ve seen a number of VCs follow through with this logic by launching marketing-related initiatives. Andrew Chen has gone into the why of this sudden spike, and points out two key reasons: 

  1. There’s been an increase in competition for early-stage deals. This is due in-part to the entrance of many new seed funds and accelerators. And it’s also due to traditionally late-stage VCs shifting their attention to the early-stage so as to avoid being shut out of late-stage deals that have become “obvious,” thereby competitive.
  2. There’s been an entrance of successful startup execs into VC, and they’re injecting an “entrepreneurial energy” into the sector.

I’d like to discuss the what of this sudden spike: what are VCs doing to differentiate their brands? A lot of attention has been put on VC “content strategies,” some of which are great and deserve the attention (I discuss some of them below). But I’m personally more bullish on the more novel and bold approaches that VCs are taking. Below, I’ve outlined some of my favorites, and a few that can use improvement.

* I use the term “marketing,” but it undercuts some of the more bold initiatives that I discuss in this post.

 

  • Collaborative Fund. Collaborative Fund has released a series of what it calls Side Projects. I don’t believe any of them have gained a great deal of traction, but the approach is really smart, and it serves to bolsters their reputation as a VC fund that is focused on the collaborative economy. One side project that they created in partnership with the Case Foundation is a sub-Reddit called Social Citizens. It’s a smart and simple effort to create community on an established platform (and portfolio company—Reddit) around a topic that is related to their thesis. Also, simply tying their brand to an organization like Case Foundation sends a signal to founders and LPs that it’s connected. Another side project they launched is 1099.is. The project helps freelancers get answers to their tax-related questions. It’s really just a great way to deliver value to the users of their portfolio companies (Kickstarter project creators, Skillshare teachers, TaskRabbit TaskRabbits, etc.). Check out the rest of their side projects here
  • Betaworks. Betaworks isn’t your typical VC firm, and that’s exactly what makes it so great. At its core, Betaworks builds and maintains many of its own products—Dots, Bitly, Instapaper and Digg are some of their most popular. But they also make a large number of seed stage investments. Overall, Betaworks has created an incredible culture of innovation and collaboration that extends throughout all of the companies that they incubate and invest in. And aside from this core model, Betaworks launched a number of projects recently that will help their investing business. The first is Alphaworks, which is a platform that lets community-focused companies raise funding from their communities in return for equity (the first company to raise funding on Alphaworks is See.me). Betaworks takes an equity stake in each company funded on the platform, which directly benefits its core investing business. The returns here have the potential to be substantial, too—Alphaworks might just attract some of the most thriving and dedicated community-focused companies to fundraise on the platform. I bet that Kickstarter’s founders—who have a reputation for being very dedicated to their community—would have used Alphaworks to fund their business if it had existed at the time. And a more recent Betaworks project is the Betaworks Book. Betawork’s Open Beta newsletter (another great project of theirs) introduced the book two weeks ago as a replacement to Betaworks CEO John Borthwick’s annual shareholder letter. As the newsletter described, the book covers everything from “interesting information about what we are doing and some trends to look out for … [to] how we innovate [and] the best way to make a cup of tea.” It’s this kind of creativity and thoughtfulness that will help sustain and differentiate Betaworks for years to come. 
  • Nivi & Naval. While Naval Ravikant and Babak Nivi are incredible entrepreneurs for building AngelList, they seem to focus just as greatly on angel investing—with over 120 investments made between them. And because they’re so focused on investing, creating and running AngelList was a brilliant move for them. Regardless of whether building AngelList was a strategic move to better their personal investing careers, they’ve pitted themselves at the center of seed-stage investing by creating a platform that has changed the way that deals come together and startups are funded. Very bold.   
  • Paul Graham. Paul Graham has been differentiating himself as an investor in a bold way for nearly 10 years. In 2005 he pioneered the incubator funding model by launching Y Combinator. Aside from propelling Paul’s personal reputation, Y Combinator has attracted and incubated tons of companies that went on to become very successful, including Dropbox, Reddit, AirBNB, Codecademy and more. Best of all, Y Combinator gets a 2-10% equity stake in each company that it funds. But Paul didn’t stop there. In 2007 he launched Hacker News, a crowd-sourced aggregator for tech news. You’ve all heard of it. What’s great about Hacker News though is that it associates Paul with a brand that founders, engineers, and other startup folks come to everyday to hear about the latest trends. I’m sure that these combined efforts have improved Paul’s deal flow substantially. But because all of this wasn’t enough, Paul introduced the Safe funding model in 2013. The Safe is intended to replace convertible notes by making them more fair and efficient—it’s really interesting to see an investor pursue such a bold and substantive improvement to how deals are structured.
  • Foundry Group & David Cohen. As impactful as Paul Graham’s Y Combinator has been, TechStars, the startup accelerator network created by Foundry Group and angel investor David Cohen in 2006, exploded the concept of incubating startups. To date there are fourteen TechStars programs throughout the world, seven of which are focused on a specific vertical (Cloud) or are co-sponsored by a major brand (Disney, Nike, Sprint, etc.). Foundry and Cohen have done an incredible job at building community in the tech startup world through TechStars—with themselves at the center—but they went even further by establishing the Global Accelerator Network (GAN) in 2010. GAN essentially serves as the “global champion” of the TechStars model of accelerators—which is seed-stage and mentorship-driven. To date, there are over 50 highly respected accelerators that are members of GAN. Foundry and Cohen’s deal flow and connections have surely benefited as a result. The same can also be said for investors that have worked with TechStars and GAN as managers of individual programs. For example, David Tisch and Adam Rothenberg—who ran TechStars NYC for several years—are both incredibly active seed-stage investors with an impressive portfolio. No doubt, the exposure they gained from the TechStars mentor network and applicant pool helped them with deal flow. But back to Foundry, TechStars and GAN are not one-off, isolated projects. Foundry partners have published several well-regarded books over the years, including Venture Deals, Do More Faster (in collaboration with Cohen), and the Startup Revolution series. And their experience in publishing has even lead them to starting their own publishing company!, which they just announced. It’s called FG Press, and it looks like they’re going to focus on business-related books. No doubt, there’s value in having tangible work with your branding on it in the hands of the community you’re targeting. Finally, Foundry produces rap videos. Yes rap videos. They’re extremely geeky, but it helps to make Foundry feel very approachable and human. 
  • First Round Capital & General Catalyst Partners. While we’re on publishing, it’s worth touching on the content marketing craze that’s been sweeping the startup world. Basically, lots of VC firms have been producing blog posts or content sites featuring startup tips, stories or analysis. First Round Capital's First Round Review stands out from the pact. For one thing, The Review’s website is beautiful. It gives the vibe of being something much more important than just a blog. The name and positioning of The Review also helps—First Round has openly stated that they want The Review to become the Harvard Business Review for startups. This gives The Review the aura that it publishes extremely high-quality, edited, and proven content. And the content itself is excellent and frequently shared within the startup community. The Review is the gold standard in VC content marketing initiatives, and it no doubt has helped solidify First Round’s reputation as a thought-leader. First Round has also funded a really interesting initiative called the Dorm Room Fund (DRF). DRF is essentially a multi-campus, student-run venture capital fund that funds startups led by students. It’s definitely a great way to stay abreast of the latest startups and youngest talent from the best universities. General Catalyst Partners (GCP) was also smart in this regard as it scooped up two founders (Peter Boyce and Nitesh Banta) of a similar initiative, Rough Draft Ventures, which is very active in the Boston area. Boyce and Banta, who are both GCP Associates and very active in the undergrad communities, have no doubt helped with obtaining deal flow for GCP. But back to First Round—in case the above initiatives aren’t enough, like Foundry, First Round also creates an annual holiday music video. They’re hilarious. 
  • Andreesen Horowitz & Google Ventures. Worth mentioning—although not for their merit—are Andreesen Howoritz’s (a16z) and Google Ventures’s (GV) content websites. Unfortunately, I feel that both firms could have done a much better job. The layouts feel very generic and they lack life. a16z’s is very blog-like, and GV’s went a little overboard with the stock photography. a16z’s, however, does feature quality content—it’s great to see the firm’s iconic name partners share their views on the latest trends. And for GV, I do like the breakdown of content by subjects, but I think they could have executed this much better. GV used to have an awesome design-focused content site called DesignStaff.com, but they recently shut it down. I think they should bring DesignStaff.com back. It presented its content in a beautiful way, and it really highlighted the GV team’s ability to help portfolio companies with design. The GV design team itself has a popular Twitter account (with 10,000+ followers)—this tells me that the team should have a more dedicated presence than a simple category page on the general GV content site. And I think the other GV teams (engineering, marketing, recruiting, etc.) deserve their own dedicated sites as well. People really respect the Google brand, and I think that by creating dedicated DesignStaff.com-like sites for different functional areas the GV team’s reputation as a thought leader will become even stronger. 
  • Sequoia. Does Sequoia really even need to differentiate itself after the WhatsApp acquisition? Probably not. But before the acquisition—in 2013—Sequoia launched a content-hub of sorts called Grove. Grove features a mix of original content produced by Sequoia team members and portfolio founders, as well as content aggregated from other sources, such as Paul Graham’s essays and Chris Dixon’s blog posts. To boot, the content is organized by rough categories and sub-topics. While I think the original content it produces adds little value (sure some of the content is good, but it’s duplicative of the efforts above), I really like the aggregator approach. However, Sequoia really dropped the ball here—the site has been live for several months already but it has only aggregated ~40 posts by ~18 topics. The problem that Grove’s aggregator aspect is trying to solve is a big one. There is SO much high-quality, timeless content out there that’s been published over the years such that many of the current efforts at creating original content on best-practices is duplicative. So I think there’s a lot of potential at making sense of the existing content. Rather than dropping the ball, Sequoia should have just slapped their name on Startup{ery, a side project I created which has already organized over 520 startup best-practices blogs posts by over 360 topics.
  • Union Square Ventures. While we’re on aggregators, its worth mentioning Union Square Venture’s (USV) new website. I’ve previously discussed why I think USV did a great a job with their site. To summarize, USV is one of a few VC firms that have a cult following. Its followers had previously hung out mostly in the obscured comment section of Fred Wilson’s blog. But with USV’s new site the USV and wider startup communities now have a more open and public forum to share their thoughts and finds. The site is relatively vibrant and less sparse as compared to Hacker News (which it is frequently compared to), and I think this will help to bring in a wider audience of people involved in policy, academia, etc. who are relevant to USV’s portfolio and policy work (which are also great initiatives). Personally, I used to use the site a lot more when it first launched, but USV changed the design recently and I’m just not really a fan of it. I’m sure they’ll adjust the design though if this is a wider trend. 
  • Funders Club. One other aggregator worth mentioning is Funders Club’s Venture News. It’s essentially a Hacker News for content related to venture capital. We all knew this was coming from someone. I previously wrote about how Hacker News-style sites will be popping across verticals and functional areas (as we’ve seen with GrowthHackers, Inbound, ProductHunt [personal fav], DesignerNews, Coinspotting, etc.). While I think it’s a decent idea given the volume of venture-related content out there, I don’t think Funders Club executed it well. The site is just another tab on the Funders Club website, and the design itself is very sparse. I also haven’t seen Funders Club promote Venture News content via Twitter, etc. And you can see how the site isn’t doing too well from the low post-volume (roughly less than a dozen posts a week). For an example of a platform that executed this venture content aggregator concept really well, check out Sandi MacPherson’s Quibb. Like Product Hunt’s Ryan Hoover and Nathan Bashaw, MacPherson modified and enhanced the Hacker News model, and she remains an active champion of the Quibb community. 
  • FirstMark. While FirstMark has a variety of community initiatives, one of them is so simple, focused and effective that it’s worth mentioning: meetups. They run two of them—one focused on data (Data Driven), and one focused on hardware(Hardwired). Datadriven has over 5,000 members, and its monthly meetups usually get over 400 attendees. Hardwired, the newer of the two (being founded just last year), has over 1,000 members and its monthly meetups usually get over 200 attendees. These are impressive numbers. From my experience running the Real Estate Tech Meetup, which has over 500 members, I know that these vertical-focused meetups get a ton of engagement from the founders, talent and other investors that attend. And as an organizer, you pit yourself at the center of this community. So I’m sure that these meetup initiatives have paid off with a boost to FirstMark’s deal flow and reputation. Plus, FirstMark has dedicated, beautiful websites for each of these meetups (check them out via the links above) with cross-branding to one another in the top right. The tactic is simple, but this complete effort helps drive the FirstMark brand in the data and hardware communities.
  • Hunter Walk, Semil Shah, Tomasz Tonguz. Every few years there are new or old bloggers that gain epic prominence. While the blogging model of VC marketing isn’t novel or bold, the content from these bloggers usually is. Fred Wilson, Mark Suster, Brad Feld, Babak Nivi, Chris Dixon and a bunch of others have all been prominent in this regard, and they still are. Current players include Hunter Walk, Semil Shah, and Tomasz Tunguz. The key aspect of these bloggers’ success is that they write unusually insightful content such that they rise to the level of a respected thought leader. It takes hard work to accomplish this status, but once you have you’ve reached the peak of our industry.

All that said, there are a number of incredibly successful investors that do nothing to differentiate themselves (outside of their traditional VC functions). Thrive Capital and Highline Venture Partners, for instance, have humorously sparse websites. But in trying to differentiate themselves, VCs should do their best to add true value to the startup community by being as bold and disruptive as the entrepreneurs that they fund. Hiring professional writers to replicate efforts made by others won’t cut it. 

 

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