If you followed this blog last year, you know that my quest to hit United 1K status ended with a December 26th trip from Denver to Washington DC. I left the house around 7:00am that morning and returned home that evening at 6:00pm, happily tweeting about the 30 miles I had to spare. And while I never want to make 1K again (that’s just too many miles to fly – especially back and forth from Denver to the east and west coasts, and in particular considering that I probably had another 20k miles on other airlines last year as well) I was pretty pleased with my achievement.

Fast forward about two weeks. I’m on my way to CES in early January. My (United) flight has already been delayed by two hours. They’ve loaded the plane, allowed us to sit on the tarmac and then pulled us back off the plane to try to locate a new aircraft. I’m four hours into my travel day and I haven’t gone anywhere and it’s not clear that I’ll be getting out at all. I’m sitting in the gate area downloading email when I receive the following from “United Mileage Plus” with the subject line “My Mileage Plus — Your updated account balance, 2009 Error in Calculation”:

I’m already steaming about United because of the delay and here I find out that my little trip to DC was all for naught – I’m still 7,000 miles away from my 1K goal. And I had checked probably 3 times with United about my account balance (making sure all of my December flights were in the system, checking to see if there were any other ways for me to get the miles w/o having to take a vacation day trip, etc.). I can’t believe they had it wrong. I tweet about the note. I tell the people around me at the airport what just happened. But I decide to wait until I cool down to actually call United and tell them when I think about their “computer error”. I’m sure that I’ll talk my way back to 1K, but if I call them right now I’ll just end up yelling at them and likely won’t make any friends in customer service.

Eventually my flight takes off and as it turns out I land at about the same time as my partner Brad, so I send him an email to wait for me so we can ride to our hotel together. We sit down in the car and he turns to me to ask if I had called United yet. But with a curious smirk on his face. I tell him I hadn’t – that I was too mad at the time to do it but was planning to do so from the hotel. I guess he felt sorry for me after such a bad travel day, because he looked at me and said: “yah. that was actually me and pete” referring to Pete Sheinbaum, CEO of Mandelbrot Project (and email expert from his days running Daily Candy). Kelly Collins from Foundry had also been in on the act (she has my United creds so they could log in to get the exact mileage amounts). They had planned to tell me later, but he couldn’t let it go any further. I actually didn’t believe him. Of course it had never occurred to me that this was anything but legitimate. And as it slowly sunk in that I had been utterly and completely taken, I literally couldn’t stop laughing.

Brad, Pete and Kelly really really got me.

And I’m still plotting my revenge…

Update below with the final email in the chain where the entrepreneur apologizes (and talks about some challenges around fundraising that led to his frustration).

I just tweeted about an unfortunate email exchange I just had with a company founder, but 140 characters isn’t enough to really do the matter justice. And more important than my venting (and to be clear this post is definitely part that) is the real issue that many entrepreneurs face about how to handle a “rejection” email from a potential funder. This is an example of how not to do it.

I pride myself on answering all the legitimate emails that I receive (punctuated by the point that it’s 8:24 on a Tuesday night and I’m sitting here at my desk doing just that). I think this is getting more common amongst VCs, but I do hear from a number of entrepreneurs that they send notes off and get nothing back. I figure everyone who emails me their plan is really excited about what they’re doing and deserves a response. Sometimes it’s a quick no, sometimes it’s more extensive if I have an idea that I think is worth sharing back.

From the entrepreneurs perspective I can understand the frustration of hearing that the idea that you’re so excited about isn’t something that whoever you emailed wants to hear more about (and I can relate – Foundry raised money from investors and got plenty of “no’s” before we managed to pull together a syndicate of fund investors). But the reality is that not everyone shares your passion, not everyone is at the right time in their fund, not everyone has time vs. other things their looking at to take a closer look, etc. And with most firms having some kind of focus, there are plenty of ideas that simply fall outside of a firm’s investment bounds. And, of course, the math makes it hard as well. At Foundry we see something like 5,000 business plans every year of which probably 500 or more are clearly plans that will get funded by someone. So there is no lack of really interesting things to take a look at. But there is a lack of time and money. In our case that means making about 8 new investments a year (give or take). I’m sure many firms have a similar funnel.

Nonetheless, handling a rejection is important. Done well it can keep the door open to further engagement (I’ve had plenty of companies that I’ve turned down drop me notes with updates on their progress and asking me questions or advice) and can sometimes lead to a later investment (we have a company in the Foundry portfolio that we (I) turned down that we funded several years later). I strongly believe in the “no assholes” rule and try to live my life by it.

Below is the exchange in question (personal details redacted), posted in all its glory. Ironically in this case it looks like this is someone I gave some advice to about a prior business plan (I don’t remember the details – it was one of thousands of these sorts of emails that I have responded to over the years). Oy!

_______________________________

Howdy Seth,

Our social site based on privacy never went anywhere.
www.[redacted].com

We were right about the privacy stuff. But no one cares. Oh well, win some you lose some. I’m proud we did it, no regrets.

Check out our site:
www.[redacted].com

We make money, been around a long time, our customers love us.

There’s a big opportunity we need help with (not sure if that’s the right lingo or not).

Any interest?

Thanks

My initial response:

Sorry that the [redacted] idea didn’t take off. It’s hard to get people interested in a new social networking idea these days (even those who say that privacy is important). Good for you for moving on to something else.

.[redacted] is definitely novel, but doesn’t really fit our investment focus (see www.foundrygroup.com/themes). Big opportunity is definitely the right lingo (and what you’re searching for…).

seth

And then this is what I get back:

Howdy Seth,

Be honest.Did you even look at the site?

Obviously it totally pissed me off (thus the tweet and the rant here). This was my response:

I’m debating whether to answer or not given the tone of your email. But I didn’t want to let your belligerent, tactless note pass. I did look at the site – and you have no reason to rudely call me out on having not done so. If you looked at our website you’d understand why this isn’t a fit for us (seewww.foundrygroup.com/themes – we’ve written extensively on what we’re interested in and what we’re not). And yes – if you had a cure for cancer we wouldn’t be a good target for you because health sciences isn’t in our investment focus (which, again, you would know had you done any research on us). We get over 5,000 business plans submitted to us each year (and fund about 8 new ideas). That’s why we’re so deliberate about what we’re interested in (and good at) and what we’re not. We have entrepreneurs of all ages and “pedigrees” (whatever exactly that is). And have funded people we’ve never met before or who don’t have 1 degree of separation with us. You can believe otherwise if that makes you happy. But there’s no need to be an asshole about it.

For a long time I’ve been fascinated by the intersection between entrepreneurship and social change. When I say that I’m not describing social entrepreneurship (a term I really don’t like; it’s not a subset of entrepreneurship, it’s simply “entrepreneurship”) or impact investing, at least not as they’re commonly understood in the current business lexicon. I really mean two things: The first is the application of entrepreneurial principles and startup techniques to solving critical, basic needs problems around the world (many of the companies I’ve worked with as a founding board member at the Unreasoanble Institute fall into this category, as one example). The second is that all businesses, regardless of the product or service they produce, can work to create positive change in their communities, including with their employees, vendors and partners (The Entrepreneurs Foundation of Colorado and more recently Pledge 1% are both great examples of organizations helping companies create positive impact in the communities in which they are building their businesses).

More recently I’ve become very interested in the B Corp movement. B Corps are for-profit companies certified by the nonprofit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. At the core of the B Corp movement is the idea that all companies share a duty for building responsible businesses. Responsible to their employees, to their customers, to their communities. I strongly believe that businesses that treat their constituents well attract and retain employees better, innovate faster, grow more quickly and create more value. I also believe that responsibility for creating a better world is something that can happen at all businesses – not as a side project or something that happens after your “core” work is done, but rather in the actions your business takes every day. By integrating responsible practices throughout an organization, companies can build better businesses while at the same time being agents for positive change in their communities and beyond.

This sort of thinking has been a part of Foundry Group since Jason, Ryan, Brad and I started the fund. In fact, before there was Foundry we got together to talk about our core operating principles. Things such as our “no assholes” rule, what we (along with our friends at Techstars)  now call #givefirst, putting entrepreneurs first and including all of our employees (and Pledge 1%) in our carried interest all came out of these discussions. As we’ve operated our firm over the past 9 years we’ve expanded on these ideas and tried to further integrate them into our business and our lives.

It is with great pride that we announce that Foundry Group has achieved B Corporation Certification through B lab. We believe that with this action we’re codifying our long-held beliefs as well as setting an example for others in our ecosystems – fellow venture firms, startups and service providers – to consider doing the same. It’s great to talk about these principles. Becoming B-Certified is our way of showing that we’re truly happy living these principles.

We are also excited that two fellow Colorado venture firms – Colorado Impact Fund and Greenmont Capital Partners – are announcing their B-certifications alongside us. We will join 75 other B-Certified companies in Colorado and over 1,700 in nearly 50 countries around the world including well-known leaders New Belgium Brewing, Patagonia, Seventh Generation, Ben & Jerry’s, Kickstarter, Etsy, Warby Parker and Hootsuite. We also join notable tech B Corps in Colorado such as Rally Software (the first ever B-Corp to go public with that certification), Namaste Solar, Simple Energy, and dojo4.

At Foundry we believe that a group of people acting together towards a common goal can have a far greater impact than when they act alone. With this in mind we challenge everyone reading this to consider joining us in the B Corp movement. #BtheChange

Below is an article I co-authored with Elizabeth MacBride of Times of Entrepreneurship (it was cross posted there on the ToE site yesterday). It’s a good companion piece to the OpEd we wrote for CNBC earlier this week. As many readers know, I’ve been working on a project highlighting entrepreneurs around the county. It’s been amazing to meet so many interesting grassroots entrepreneurs and hear so many compelling stories. I’m happy to be able to start sharing some of those. More details (and on our upcoming book on that subject) soon.

Why is America so divided? The loss of small businesses may be one answer. In research for our upcoming book, we found that small business owners often inhabit the shrinking middle ground of politics in their communities.

Out in the corral, Mark Cheff rubs some salve on Chinook’s leg above her hoof. Yesterday, two of the mare’s children were standing on either side of her, licking a deep wound caused by a sharp branch sticking out across the trail at just the wrong angle. Cheff thinks she’ll be OK by the end of the tourist season, this fall.

What the future looks like for his small business and the other 25 million — or maybe 22 million, now as the number of small businesses is shrinking rapidly — is less clear. Cheff has been a smokejumper, and owned a construction company. Now, with his wife, Claire, he owns a guide company in the Bob Marshall Wilderness of Montana. Like many of those businesses, the Cheffs, through 406 Wilderness Outfitters, contribute to their community as a source of economic activity, innovation and jobs — and in other surprising ways, as well.

Perhaps we’ll sound hopelessly old-fashioned as we say this. But as we have interviewed dozens of small business owners across the country for our upcoming book, we’ve found people of principal who value hard work; people who are passing along these values to the next generation of young people; people who are safeguarding the futures of their communities.

$5.9 Trillion Of GDP

As a country it seems we may have forgotten the value of these small businesses. America is home to a lot of big companies that dominate the headlines, mindshare and financial markets of our country. But the real story of American business has always been about small. Small businesses are “the lifeblood of the U.S. economy: They create two-thirds of net new jobs and are the driving force behind U.S. innovation and competitiveness,” says the SBA, which tracks business trends for the U.S. government. Small businesses accounted for 44% of all economic activity in the United States and were responsible for $5.9 Trillion in GDP in 2014, the last year for which data are available.

Even before the pandemic, we let our fascination with larger businesses – and the cheaper prices and greater convenience they provide to us – crowd out the evidence of what’s going at the startup and small end of the economy. The trend is that America’s small businesses have been in trouble for a while. Since the end of WWII, the US economy consistently produced net new businesses – more businesses started than closed down. This remained true through any number of recessions. However, this resilience ended with the Great Recession of 2008. The net number of new firms created in the United States was negative – more companies closed than were being started. The result was 117,000 fewer companies in 2014 than there were in 2007. Some 3.4 million jobs don’t exist today because of the decline in entrepreneurship during the Great Recession.

COVID-19 is extending the damage to small businesses much deeper than most people have realized. Even businesses that, by their nature, operate outdoors and with social distancing, such as wilderness companies, have not been immune to the economic effect of COVID-19. A number of the Cheffs’ week long, pre-booked trips have been canceled – devastating blows to a small family business that only runs about a dozen trips a season while “The Bob”, as the Bob Marshall is known to locals, is accessible (for much of the year, the trails are blocked by snow).

The Cheffs intend to make it. But many businesses will not. One recently released working paper by economist Robert Fairlie suggested that the number of businesses in the United States fell by 22% – 3.3 million businesses – between just February 2002 and April 2020. Not surprisingly, this was the largest drop ever recorded. And that was just in the initial months of the pandemic. We’re bracing for a fall surge that could devastate larger swaths of the American small business economy.

Only 20% Of Metro Areas Show Growth

When we lose small businesses, our divisions deepen. In the 30 years leading up to the Great Recession, fully 80% of metro areas experienced an increase in the number of firms annually. This trend was completely reversed by the Great Recession, after which only 20% of metro areas have seen an increasing number of companies created. New business formation has been depressed in most of the country.

Economists have been puzzling about the reasons for the decline in entrepreneurship. The answer is pretty simple. It’s always been hard to be a small business owner and lately it’s become even harder. Here’s one tiny example: health insurance. It’s unlikely the Cheffs would be in business without the help of the health insurance provided by Claire’s second job – she works as a teacher in the nearby Ronan public schools, a job that maps up well to her “off-season” of guiding. Good insurance is critical, because Mark Cheff has rheumatoid arthritis. In his smoke jumping career, he carried 120-pound packs for as much as 25 miles to fight the increasing number and severity of fires that occur in our nation’s wilderness. A hospital stay this winter didn’t keep him from playing a practical joke on the people who came to see him: Pretending to be brain damaged for the first few minutes of the visit.

What motivates a small business owner to keep going, working another job, or dealing with physical hardship, or the stress of making a payroll — during a pandemic? It’s true that many small business owners want to build wealth. A number succeed, which is good for the economy. But many more start businesses because of a sense of purpose or calling, because they want to pursue a passion or to create freedom and flexibility for themselves and their families. People faced with hostile work environments, especially women business owners and people of color, and older people, start companies to create their own opportunities where they can dictate their own work.

Overwhelmingly, as we interview small business owners across the country, we find they have stuck with it against the tough backdrop of the last few decades because they love what they do. COVID-19 may be the final blow for many more of them.

When we lose a small business, we lose that passion in action, which transmits values. It’s no accident that the Forest Rangers figuring out how to lobby for the trail budget they need to keep the Bob Marshall safe look to small guide companies for help. Or that the Blackfeet Tribe, as it fought a decades-long battle to void a mineral rights contract on its land, built a coalition of local small businesses to help. There is a big business in the area — Xanterra, which has the Glacier Park concession contract. It’s owned by billionaire Philip Frederick Anschutz, who also owns oil, railroads, telecommunications and entertainment companies. Safe to say nobody around here has his phone number.

Claire Cheff calls their guide business a calling; it was founded almost 100 years ago by Mark Cheff’s grandparents, a Montana cowboy and a Salish outdoorswoman. Claire Cheff married into the family and loves to watch families reconnect as the mobile phone signals disappear a mile or two up the trail. People panic briefly, and then they start to talk. The trips are an adventurous vacation, but with the side effects of teaching respect for the environment, the importance of land preservation and plain old-fashioned humility. Everyone gets equally sore and dirty on a 10-hour ride in.

Entrepreneurs Do More Than Supply Jobs

Our responses to the pandemic so far have focused on jobs, and small businesses’ role as employers. The Federal Payroll Protection Program (PPP) enabled some small businesses to keep their employees, at least for a time. But it had its limitations – and those limitations hit small businesses especially hard. The next iteration of federal aid will need to have a more powerful focus on the smallest companies in our economy if we’re to have any chance of saving them. These companies need to see an extension of the PPP program – particularly for those who have been hardest hit; a broader set of expenses against which aid money can be spent and still be forgiven; and, importantly, the expenses covered by PPP need to be tax deductible so small businesses don’t face an insurmountable tax burden at the end of the year. A streamlined and clear borrowing and forgiveness process are also critical pieces that should be addressed in new legislation.

Maybe it will spur Congress, state legislatures or private philanthropies to action if we recognize the intangibles slipping away as millions of businesses close. Like many small business owners, the Cheffs exist in a web of other small businesses and are de facto workforce training, sometimes for young men who need nothing so much as a summerlong dose of hard physical work.

And while we think of dynamism and innovation as qualities that belong to mostly or solely high-tech companies – that would be a mistake. The Cheffs and other guides are on the cutting edge of two trends in American outdoor life: adventure sports and lightweight rafting. Inventions go nowhere without businesses to bring them to market. Very often, it’s the small businesses inside and outside of the tech world that do that heavy lifting.

The Complicated Middle Ground

One of the most important roles small businesses play is that they occupy the nuanced, complicated middle ground. In our research, we’ve seen small business owners taking unexpected stands that are outside the norms — or at least, the stereotypes of what the norms are supposed to be. Progressive on one issue, they are conservative on another. The connection isn’t always obvious, until you recognize that their interest lies in the long-term health of their communities.

On any given night on a recent weeklong trip, small business owners gathered around this Western campfire. The conversations between the Cheffs and the Albers, who own a sawyer company called Miller Creek Reforestation, include talk about the loggers who make a living off timber but who also supported the latest wilderness expansion. Everyone celebrates the victory of the Blackfeet Tribe at Badger Two Medicine. There’s also concern for the Montanans being displaced by less expensive immigrant labor — as well as for the labor standards the immigrants work under. COVID is a concern. So is the health of the business community.

There’s worry about the Forest Service budget, but also an idea to apply for a grant to supplement it. It’s not knee-jerk criticism of “politicians.” It’s a recognition that decisions aren’t simple, and that nobody “wins” in a functioning community — the victory is in continuing to coexist.

When we lose small businesses, we take a loss on three incredibly important pieces of America. We lose jobs and on-the-job training. We lose dynamism and innovation. We lose their owners’ voices, as people of economic stature who have a long-term interest in their communities, and ours.

If our country is to heal, it needs small business owners back and engaged, full-strength. They are the backbone of America. We need to save them.

Adapted from The New Builders: Why Women, People of Color and People over 40 Are America’s Economic Future (tentative title), upcoming by Seth Levine and Elizabeth MacBride

Entrepreneurship in the United States is changing pretty dramatically – in ways that many of us have failed to notice or understand. Specifically today’s American entrepreneurs are more likely to be female and non-white. In fact, the number of women-owned businesses has increased 31 times between 1972 and 2018 according to the Kauffman Foundation (in 1972, women-owned businesses accounted for just 4.6% of all firms; in 2018 that figure was 40%). Meanwhile, the fastest-growing group female entrepreneurs are women of color, who are responsible for 64% of the new women-owned businesses being created. There’s a lot more to dig into here, which I’ll do in future posts. But it’s urgent that we begin to understand this because we’re failing to build systems to support these new entrepreneurs. This has become especially clear in the current economic crisis, as I pointed out in this piece I wrote with Elizabeth Macbride a few weeks ago for CNBC as well as this post from last week. Relief money authorized by congress under various programs of the CARES Act and other initiatives is failing to reach many women and minority owned businesses and is highlighting structural issues with the way we support entrepreneurs in the United States. For example, it has been widely documented that women and minority owned businesses are not accessing aid through the Payroll Protection Program (PPP) – see for example, here, here, here, here, here. This program requires businesses to have relationships with certain approved SBA lenders, which women and minority owned businesses are less likely to have. Its initial roll-out excluded certain types of financial institutions (most notably CDFIs) which disproportionately bank these businesses. It also left much of the underwriting criteria up to the banks themselves, who favored other customers. And the program itself – based on W2 payroll and primarily benefiting businesses that were in a position to open up quickly – failed to address the kinds of businesses most likely to be started by this new generation of entrepreneurs.

We can and must do better.

Which is why I’d like to highlight for you a great program called EforAll.  Launched in 2013 with a mission of partnering with communities to help under-represented individuals successfully start and grow their businesses, EforAll is a pretty special organization. I’ve gotten to know them well over the past two years (Brad and his wife Amy, as well as Greeley and I are financial supporters of EforAll). EforAll combines immersive business training, mentorship and an extensive support network to help support their entrepreneurs. It’s incredibly compelling and urgently needed – now more than ever. EforAll is up and running in 9 communities in Massachusetts and Colorado and, to date, they’ve supported entrepreneurs in starting almost 350 businesses, 83% of which continue to be actively pursued by their founders. About a year ago we launched in Longmont and that program just graduated their first class (I attended the virtual demo day/graduation – it was inspiring).

We’ll be starting up another Longmont program this summer and are looking for mentors in Boulder and the Front Range (although potentially for this one anywhere – we anticipate much of this summer’s program will end up being virtual). This is a fantastic opportunity to help female, minority, and immigrant entrepreneurs pursue their business ideas.

A few stats:

EforAll National
– Over 500 ventures graduated
– Nearly $35M in capital raised
– Over $25M in 2019 revenue

EforAll Longmont
– 9 businesses (11 entrepreneurs) went through first Longmont accelerator
– Those entrepreneurs were from the North Metro area, Boulder County, and Weld County
– Ventures in the first program ranged from gluten-free beer & pastries being made from ancient grains & traditional Peruvian recipes, to a financial literacy app for elementary school students, to a husband & wife duo manufacturing adaptive underwear for individuals with sensory disabilities
– Highlights from the first accelerator include an entrepreneur securing her first two grocery store clients for her plant-based meat product, an entrepreneur raising 40k from friends and family, and an entrepreneur launching their first online marketplace for disability-focused products
– EforAll Longmont was also mentioned in this href=”https://www.nytimes.com/2020/02/07/your-money/entrepreneurship-philanthropy-gururaj-deshpande.html”>New York Times article, received support from Google, and worked with more than 50 volunteers during our first accelerator (including about 30 mentors)

EforAll Mentoring Ask – Mentoring with EforAll is a fantastic way to support small businesses and aspiring entrepreneurs in your own background. Accelerator Mentors come from a variety of backgrounds and use their business and leadership experience to guide new entrepreneurs through the process of starting or growing a business. Mentors work in teams of three and are matched with an entrepreneur based on schedule availability and desire to work together. The team meets as a group to help reaffirm topics and themes raised during classes, while also strategizing with the entrepreneur on how to reach their specific goals during the program. Mentoring with EforAll is a 90-minute per-week commitment from July-September and all meetings between entrepreneurs and mentors will take place virtually. For more information, you can click here and you can also email EforAll Colorado Executive Director, Harris Rollinger, at harris@eforall.org.

I get this question all the time from friends and colleagues. Between portfolio companies, prospective investments, our investment themes, my partners, family and other topics that interest me, there’s a lot of information in my universe that I need to track. And this information ranges from blog posts, to tweets to mainstream press articles. It’s a lot to pay attention to (not to mention all of the individual blogs I follow ….).  For a while I was using Google Alerts but 1) there wasn’t a great way to organize them (they just showed up when they showed up – as individual "hits"); 2) they seemed to be missing a ton of information; 3) at least 2/3rds of what came through was old news (i.e., someone had made a minor change to a page which caused the Google crawler to mark it as ‘new’); 4) there was no history, tracking, etc; and 5) they were clogging up my inbox. I could go on, but if you’re a heavy user of Google Alerts, I’m sure you’re already shaking your head up and down in sympathy.

So what’s an information junky to do?  Here’s my solution (which skips the obvious morning blog perusal and clicking through the handful of news sties that I’ve set my browser to open to):

Filtrbox

Filtrbox is an information gathering and tracking service, that was founded here in Boulder and was a part of the inaugural group of TechStars companies (note: I have a small personal investment in the company).  Think of it as Google Alerts on steroids (or just Google Alerts that actually works).  I’ve organized Filtrbox into a handful of folders (one for each portfolio company I track, for Foundry, for a handful of companies not in the portfolio I’m paying attention to, for family, themes, etc.).  A folder’s "filtrs" cover all of the key topics for that subject (for example, a folder for a portfolio company would include mentions for the company, it’s products, management team, competitors, etc).  Filtrbox allows me to easily tune these folders and filtrs to make sure that I’m getting relevant information (for example by adding excluded words to a filtr so "TopSpin" isn’t returning me 100 results on tennis).  I can also turn on or off social media coverage and the like to easily see only mainstream media mentions or to include blogs, twitter, etc.  Every day I receive a morning digest of top stories from which I can click through to stories that interest me or just peruse the digetst to get a general sense of what topics are being written about on a given day. I can also head to their dashboard for charts, analytics, etc.  They have a free trial which I’d highly encourage you to check out. Pricing starts at $10/month.

Gist

What Filtrbox is for explicit information gathering Gist is for implicit information gathering.  Gist is still in private beta (I met their CEO at Defrag and he gave me a log-in to the system – he’ll be at Glue as well and you might be able to sweet-talk him into letting you in the beta if you’re there…) but I think will soon open up to a larger audience. Gist scans my email, contacts and calendar and draws inferences about who in my universe is important to me and what companies I’m paying attention to (or should be) and then organizes an online dashboard of information sorted by person or company based on their read of the information they’ve collected.  I can quickly scan the first paragraph or so of stories they’ve come up with directly in the Gist dashboard or click through to read the full story. This is great for grabbing timely information (for example about a company that is on my calendar that day, since Gist recognizes that this is important information and treats it as such) and quickly scanning who/what are the handful of topics for the day.

I love how I can set the specific parameters in Filtrbox to grab information on just those topics that are of key importance to me.  And I love that Gist discovers for me who/what are most important in my world and shows me the news accordingly. Together they allow me to make sure I’m completely overloaded with information … which is just how I like it.

I recently wrote a blog – The Power of Location – about Quova (one of the companies I work with) and the idea of “place” on the Internet.  In response, Dimitar Vesselinov (who has a great blog) dropped a couple of comments to the post. My sense is that not everyone pays attention to the comments section of blogs, so I thought I’d post the links he suggests here. I also want to be sure I’m clear on the differences between digital identity (the subject of Dimitar’s comments) and geolocation (the subject of my post) as well as how the two ideas overlap.

First the comments. Below are some sites that Dimitar sent over for those interested in learning more about digital identity:

Schneier on Security
http://www.schneier.com/blog

The Identity Corner
http://www.idcorner.org

Identity Woman
http://www.identitywoman.net

Kim Cameron’s Identity Weblog
http://www.identityblog.com

Presentations & Audio :: Digital ID World 2004 Conference
http://conference.digitalidworld.com/2004/attendees/downloads.php

I’ve seen a couple of these sites in my travels on the Internet and checked the rest out after he sent along the comment – there’s good information here that’s worth checking out. The notion of digital identity, which seemed to lurk in the shadows for the past few years, is really starting to take off – especially now that the ever-feared Microsoft has given up on Passport (I don’t think I know anyone who actually used this service for anything close to what Microsoft intended; signing up for messenger or MSN through passport doesn’t count).

There’s clearly overlap with the world of geolocation – particularly in the realm of security and authentication (just as your digital id can be used to confirm that you are who you say you are, so can geolocation data be used to support your claim of who you are). There are important differences, however and the markets really aren’t heading in the same direction. Who you are is different from where you are. While its important at times to know who is involved in a transaction, its often just important (or more important) to know where they are (for example in validating taxes in an on-line transaction – in the off-line analogy, I don’t get charged Boulder taxes when I buy something in San Francisco just because I’m from Boulder – where I am is more important in that case than who I am).

Also, digital id is great for people who want other people to know who they are, but only works when they are part of the equation. Put it another way, digital id is for the most part an active technology – you (or your administrator) needs to actively participate in creating your digital identity. Very useful if for when you are trying to validate on a network or manage access to an array of applications. Its not useful at all if the user wants to remain anonymous or for whatever reason doesn’t want to participate in actively identifying who they are. Geolocation is passive – it doesn’t involve cookies or user defined parameters, just a look-up on an IP address. And while you can run your address through an anonomyzer service to mask your address, you ultimately have an IP address assigned to you (which may mean that a service like Quova can only tell that you are trying to hide where you are vs. telling where you are). This makes the potential universe of traceable events much higher – since every transaction on the Internet involves an IP address (even if its attempted to be masked or anonomyzed in some way) but clearly there will be only a small subset of events that involve digital id (and they will be easier to mask). I imagine that Damitar gets all this, however I wanted to add some context with which to look at the two markets.

My longtime friend Marion Jenkins, CEO of IT consultant QSE Technologies wrote what I think is one of the most eloquent and well thought out rebuttals to the proposed Colorado “Software Tax” (HB 1192).  With his permission I’m posting it here in its entirety. If you feel the way I do about this issue, I urge you to take a stand on this issue.

I urge you to oppose HB 1192, the so-called “Software” Tax.  It is bad legislation and it will add significantly to non-productive administrative and legal overhead and kill productivity within the technology sector in Colorado (including not only technology-related businesses, but virtually every business – and every consumer – who uses technology).  It will also lead to a mass exodus of key jobs and technology talent from Colorado, and it runs counter to many Federal initiatives aimed at creating jobs, improving job skills and implementing automation and efficiency to help the country get out of this recession. It will also lead to a massive expansion of government, whose only function will be to try to interpret and unravel an impossibly complex set of new tax rules.  Those new government jobs will not provide any benefits to citizens, and particularly not provide any benefits directly to underserved populations, they will consist of auditors, analysts, enforcers and the like.

First, some background and disclosure:

1. I run an 8-year old information technology company in Englewood, QSE Technologies, Inc..  My family and I have lived in Colorado (Centennial) for nearly 12 years.  I live in House District 47 (Spencer Swalm) and Senate District 27 (Nancy Spence).  Our business is located in House District 44 (Mike May), and Senate District 30 (Ted Harvey) and most of our ~15 employees live in these same or surrounding Districts in the South Denver area.

2. I grew up on a family potato farm in SE Idaho and I have a PhD in Engineering from Stanford (also known as The Farm).  So I feel I have pretty good mix of horse sense and formal education.  I have been in the technology industry for 30+ years. 

3. I serve as adjunct faculty at the University of Denver, where I head up a graduate program division in healthcare information technology within University College. I serve on the board of directors and many other committees of the South Metro Denver Chamber of Commerce.  I also belong to the Aurora Chamber of Commerce, CHIMSS (Colorado Health Information Management Systems Society), AHIMA (American Health Information Management Association), CMS (Colorado Medical Society), CMGMA (Colorado Medical Group Management Association), CHSM (Colorado Healthcare Strategy and Management) and other business/technology organizations.

4. Among other corporate positions in my career, I have been a Chief Information Officer, Chief Technology Officer, Chief Operating Officer and Senior Research Engineer for small private companies, and also some Fortune 500 and even Fortune 10 companies.

5. This bill will NOT affect our company.  It will not cause us to raise prices or lay off people, or relocate out of state.  That is because we do not sell, or use, anything other than “canned” software, for which we collect and remit appropriate sales taxes.  Therefore I am not trying to protect any personal or business rice bowl.

6. Along with about 15 colleagues from CSIA (Colorado’s technology association) and other groups, I testified in opposition of this bill on Wednesday night/Thursday morning.  (thank you for your time and attention to our testimony, by the way). 

7. Although you sat through our testimony, I don’t think you understood it.  I think you saw and heard the same kind of turf-war, rice-bowl protection that you had been hearing all day.  The purpose of this email is to clarify some facts, because this is an extremely confusing issue.

There are many reasons why I oppose this bill (the way it is crafted, which in my opinion is a net new tax, which should go before the voters; the way all these initiatives were pre-packaged and front-loaded at the beginning of the session, before most citizens knew what was going on; the hearings that stretched into the middle of the night, in an obvious attempt to “wear out” the opposition; the way they are all characterized as “business” taxes, but in reality they will merely be passed on to all consumers – and therefore these are net new taxes on citizens, not on businesses.)

(As an aside, I have lots of other objections.  I object to this “nibbling at the edges” of the state’s budget deficit problem by trying to implement taxes here and there in a piece-meal fashion and splinter any opposition and paint this as a “business” problem, which sets up a “business versus K12 education” issue.  If the state has budget issues, which I believe it does, and needs to raise tax revenue (which has other options available such as cutting staff, eliminating duplication and programs and implementing automation – all of which businesses have been doing for the last ~2 years), then let’s raise taxes.  Don’t set up dozens of new statutes that tax sodas and candy and vending machines and Styrofoam cups and ketchup packets, go ahead and come out into the open and craft a bill to tax everything sold in a grocery store, including food, and/or implement a tax on all services (including attorneys, accountants and consultants) and take the problem to the people and see what they say.)

However, the only thing I am going to address in this email is the enormous complexity that makes HB 1192 simply impossible to implement and enforce, and that is why it should be opposed.

When Representative Pommer introduced HB 1192 to your committee Wednesday night, he positioned the bill in an incredibly simplistic fashion.  He said that people who download “standard” software (like TurboTax) from the internet should pay sales taxes, just like someone who buys TurboTax in a box at BestBuy.  His premise was that the delivery method of software – and whether there was actual media involved (i.e., CDs) – shouldn’t change whether the software should be taxed.  I actually agree with and could support that idea, at least in principle.

The TurboTax scenario seems straightforward.  But at the margins – for really large and really small software packages – this bill is a disaster.  On the low end, think of a download of small mini-apps:  a $.95 ringtone, a $1 MP3 song, a $2 e-book, a $5 upgrade to your GPS.  How can you tax those things, and would it even be worth it to try?  Do you tax a business traveler from Texas who orders TurboTax on his WiFi at Starbucks in Cherry Creek or a tourist from Oklahoma who does so from his SmartPhone while sitting on the chairlift at Vail?  How about a person who moves here from Boston but keeps his Boston phone number on his SmartPhone and uses it to surf the web and order “software?”

These are tricky but important details.

At the other end of the size/complexity spectrum, it gets even worse.  This bill defines “standard” software as any software package – or portion thereof – that is sold to more than one person or entity.  All such “standard” software (or portions thereof) would be subject to tax.  That has huge implications for virtually any business, whose software purchases and implementations are infinitely more complex than a person downloading TurboTax from the Web.

As an illustration, let me share with you the list below, which came to me yesterday in an email solicitation from a company that collects this kind of technical information from big companies and markets it to companies like ours, hoping we will buy their marketing/intelligence lists. 

This is a list of all the technology used by a Fortune 500 Company (not Qwest) listing all their major
technology systems, subsystems and software. 

Technologies:
Hardware/OS/Systems Environment

AT&T Sterling Commerce Yantra Warehouse, Cisco IOS, Citrix MetaFrame, HP-UX, HP-UX 11i, IBM AIX, IBM AS/400, IBM OS/390, IBM VSAM, IBM z/OS, INM CICS, Microsoft Active Directory, Microsoft Cluster Server, Microsoft Terminal Server, Microsoft VPN Servers, Microsoft Windows 2003 Server, Microsoft Windows NT Server, Norton Ghost, Novell NetWare, Red Hat Linux, Sun Solaris 8, Sun Solaris 9, Teradata Data Warehouse, Unix, VMWare, VMWare Server, Wyse Winterm, Avaya Intuity Conversant
Data Management / Business Intelligence
BEA WebLogic 8.1 / Oracle WebLogic Servers 8.1, BEZ Systems BEZPlus Data Warehouse Tool, DB2, File Aid, IBM Cognos, IBM Cognos PowerPlay, IBM DB2, IBM Informatica, IBM Informatica Builders WebFOCUS, IBM Informatica PowerCenter, JD Edwards World, Microsoft Access 2000, Microsoft SQL Server 2000, Microsoft SQL Server 2005, Microsoft SQL Server 7, Omniture SiteCatalyst, OmnitureHBX, Oracle 10g, Oracle 8i, Oracle 9i, Oracle Fusion Middleware, Oracle Hyperion, Oracle PeopleSoft Financials, Oracle PeopleSoft Financials 8.8, Oracle real Application Clusters, Qualys QualysGuard, SAP Business Objects Broadcast Scheduler, SAP Business Objects Crystal Enterprise 8.5, SAP Business Objects Crystal Enterprise XI, SAP Business Objects Crystal Reports 8.5, SAP Business Objects Set Analysis, SAP Business Objects Web Intelligence, SAP NetWeaver Business Information Warehouse, Security Innovation, Sun MySQL, Sybase 10, Teradata Active Enterprise Data Warehouse v2 R6,
Networking / Information Security
Connectria Integration Services, Progress Software DataXtend CE, Tuxedo, BMC Marimba 6, BMC Marimba 7, CA Unicenter, Cisco CiscoWorks LAN Management System, Citrix MetaFrame XP, Citrix Presentation Server 3.0, Citrix Presentation Server 4.0, Citrix Presentation Server 4.5, Citrix XenApp, EMC EmailXtender, HP Mercury LoadRunner, HP OpenView, Microsoft Internet Security and Acceleration server, Microsoft SCCM 2007, Microsoft SMS, Microsoft SQL Server Management Studio, Oracle Enterprise Manager, Oracle Identity Manager, Symantec backup Exec, Symantec Veritas NetBackup, Symantec Veritas Storage foundation, VMWare WorkStation, 123 EDI Shipping Outsourcing, Cisco PIX Firewall, ArcSight Log Consolidation system, Wavelink Avalanche server and client, Sygate Secure Enterprise Solution, Cisco Secure ACS Solution Engine,
Development / Programming Tools
Ab Initio, Adobe Coldfusion, Adobe Dreamweaver, AJAX, Altova mapForce, Altova XML Spy, Apache maven, Apache Struts, Apache Tomcat, Autonomy Interwoven sitePublisher, Autonomy Interwoven TeamSite, Borland VisiBroker 3.4, C, C++, CA ERwin, Citrix, COBOL, Compuware File Aid, Cywin, Eclipse, Embercadero Sapid SQL, Hibernate, HP Mercury Quality Center, HP Mercury Test Director, IBM Rational Clearcase, IBM Rational ClearQuest, IBM Rational Rose, IBM WebSphere Application Server, IBM WebSphere MQ, Java, Java Beans, JavaScript, JSF, JSP, JUnit, Microsoft .NET Framework, Microsoft ADO.NET, Microsoft ASP.NET, Microsoft C#, Microsoft Internet Information Services, Microsoft Office Communications Server, Microsoft SharePoint Server 2007, Microsoft Sybase T-SQL, Microsoft Team Foundation Server, Microsoft Visio 5, Microsoft Visual Basic .NET, Microsoft Visual Basic 6, Microsoft Visual Basic for Applications, Microsoft Visual SourceSafe, Microsoft Visual Studio 2005, Microsoft Visual Studio 2008, Open Text LiveLink 9.2, Oracle BEA JRockit, Oracle BEA Tuxedo, Oracle BEA WebLogic Application Server, Oracle PL/SQL, Oracle Primavera TeamPlay, Oracle SQL*Developer, Oracle SQL*Loader, Perl, Progress Software DataExtend CE, Red Hat iPlanet Web Server, Red Hat JBoss, ROBOT, SAP Business Objetcs Application Foundation, Spring, Sybase powerbuilder, Tibco rendezvous, TOAD, Vignette Builder, Vignette Content Server, Scrum Development,
Enterprise Applications
Amdocs Clarify CRM, Amdocs ClearCall Center, Amdocs Clearsales, Amdocs ClearSupport, AT&T Sterling Commerce Yantra Warehouse Management System, Descartes Mobitrac Transportation Execution System, EMC Documentum, Hodes iQ Talent Management, IBM Lotus Domino, IBM Lotus Notes, Lotus Notes, Microsoft Exchange 2003, Microsoft Exchange 2007, Microsoft SharePointServer, Open Text BlueBird, Open Text Hummingbird RedDot Enterprise Content Management, Oracle Financials, Oracle PeopleSoft 7.5, Oracle PeopleSoft 8.9, Oracle PeopleSoft 8.8, SAP Global Trade Services, SAP R/3,
Other Technologies / ITO Agreements / IT Intel
ABC has created a custom application server using Oracle Fusion Middleware and Oracle WebLogic Server called ABC Unified Strategic Information Optimization Network, or FUSION. It allows the company to eliminate the lines between their separate business units as well as improve customer satisfaction, 123 EDI Shipping Outsourcing, ArcGIS geographic authoring, BGT Partners consulting for B2B portal and CMS, Clarity Consulting for ABC QuickShip Application Development, Computer Aid, Inc. for managed mainenance automotive), Connectriaintegration Services, Cstomer Fsion Database, Dun & Bradstreet Dashboard, Google Analytics, IBM Global Technology services, Interknowlogy consulting for Application development, Loftware barcode and RFID Software, Microsoft Visio, Microsoftproject, Quad Graphics Parcel Direct, Six by Six, Telefonica Datacenter

Look through this list and ask yourself this question…do you think your 0.95 FTE employee in the DOR (which was claimed to be the only headcount needed to implement/oversee HB 1192) would even have a clue as to half of what these software packages are, how they are used, and which ones are “standard” and which ones are custom, or how and to what extent some standard modules may be embedded inside of the corporation’s customized software systems?  I have been in technology for 30 years and I recognize barely about 75% of them.

It would take a small army of experts to figure this out.  The other night I gave you a SWAG number of 25 DOR FTEs to oversee this.  After further thought my slightly more educated SWAG is now well over 100.  An equal number of non-productive administrative/audit people would be needed on the other end, within businesses who use technology, as well as their technology partners.  Every software project would have to be separated into “standard” (taxable) and “custom” (non-taxable) categories.  You would literally have to go through the software code line by line to determine compliance.  And, by the way, software code isn’t even written or measured “line by line” any more.

Any similar company (Colorado currently has 11 Fortune 500 Companies) would have a similar list.  Obviously a smaller company would have a smaller list, but even a 20-person company can easily have dozens of software applications, some “standard,” some custom, and some a mixture.

This is a nightmare.

As a result of your other tax proposals, will people go to Cheyenne or Salt Lake for a Pepsi or a Snickers bar or Chinese takeout?  Will Colorado businesses close down or move out of state if some of their supplies now get taxed?  Will Colorado consumers stop buying things on the Web if they have to pay taxes on them?  Those are debatable. 

Would technology jobs leave the state as a result of HB 1192?  Not only is it a definite yes, but you must understand that it is relatively easy to do so.  Moving a manufacturing facility is hard.  Moving a technology platform is easy.  Any sizable company would find it easy – as well as advantageous – to move their technology to Seattle or Omaha or Minneapolis to avoid the brain damage of auditing and accounting for and paying the taxes under HB 1192.  Not only would that company’s technology jobs move along with the technology platforms, but the jobs of any outside consulting/implement
ation partner would move out of the state as well.  And no large or growing company – and definitely no high-tech company – would consider moving into or investing further in Colorado if faced with this imposing and formidable barrier to technology, automation and efficiency.

There are many other technical issues…SaaS (software-as-a-service).  Cloud Computing.  Virtualization.  Managed Services/Hosting.  Object-oriented development.  Data center hosting.  Disaster recovery and remote/hot site services.  Software re-use.  Service-oriented architecture.  Software toolkits.  Telecommuting and virtual workforce.  Hosted telecom apps and VoIP services.  These are just some delivery methods and technology concepts that are at the leading edge of the technology frontier, and Colorado is at the forefront of these and other innovations.  Every one of them has special circumstances that will have to be investigated – and analyzed and unraveled – to comply with HB 1192.  So instead of spending time on productive efforts like innovation and implementation, companies will have to invest significant time in non-productive audits and compliance.

I want to emphasize again that this doesn’t just negatively impact technology companies like QSE and our peers, it affects every business who uses technology in their business.

Additionally, in Colorado and elsewhere, there is a shortage of students entering STEM – Science, Technology, Engineering and Math.  There are many formal and informal initiatives aimed at training and re-training both youth and adults to enter or shift to the technology workforce.  Several Federal jobs training programs are focusing on these efforts.  In addition, information technology is at the core of green/sustainable energy initiatives.  HB 1192 runs counter to those efforts, and would undoubtedly stifle future growth of talent here in the state, and cause the loss of federal education and training funds.

And lastly, the ARRA/HITECH act earmarks $19.5 billion in Federal funds for the implementation of IT in healthcare, which has shown to help lower our outrageous healthcare costs, reduce costly medical errors and improve patient outcomes.  Providers and other entities are reluctant to adopt automation and technology, primarily because of costs and other barriers.  By taxing software, HB 1192 increases those barriers, and would definitely cause the State of Colorado to miss out on some of those federal funds…they would go to other healthcare entities in other states. 

This issue isn’t about the software industry, or even the technology industry.  It’s about every business and every consumer in the state.  Technology is one of the few industries that is helping to lead the recovery, and helps all businesses become more efficient.  Colorado has grown in talent, infrastructure, and status to become recognized as a critical technology hub, and this bill will absolutely reverse that trend and shift the jobs and the capital investments to other – and eager – states.  But our testimony earlier this week, and this email, isn’t to protect the technology industry from further taxes.  Although the citizens and businesses of Colorado don’t realize it, my CSIA colleagues and I are working on their behalf.  Most of them don’t even know yet that HB 1192 exists, or what negative impact it would have on them.

In summary, I urge you to oppose HB 1192.  Its unintended consequences and confusing definitions are anathema to the economic health of Colorado.

Community is one of the driving forces at Foundry Group. We’ve kept ourselves intentionally small as a firm so we can keep our close connection with our portfolio founders from due diligence, to investment, and throughout the lifecycle of our investments. We strongly believe that fostering a mesh network model, which allows our network members to interact directly with one another, is the best way for all of us to learn, develop, and thrive together (vs the more traditional hub and spoke model that most firms end up falling into with partners as gatekeepers). Keeping this model improving and evolving is so important to us, especially in the current climate of social and economic change. We want our programming to be impactful, relevant, and able to serve our community in a way that promotes growth, development, collaboration, and ultimately successful company and fund outcomes. In light of this, we’re excited to announce that we’re hiring a Head of Network to expand and develop Foundry’s network programs. The full job description is below. If you or anyone you know fits the bill, please reach out to us at apply@foundrygroup.com. And please help us get the word out!

We’re looking for a leader to create a more robust, dynamic, and connected network program at Foundry Group. The Foundry Network, as we’ve been calling it, encompasses founders, CEOs, executives, general partners of our underlying venture capital fund investments, limited partners (our investors as well as other investors in the funds we have investments in), and other members of our ecosystem. We regularly bring together members of this community to connect, share, and learn from each other. 

We know we’re just scratching the surface for how powerful this network can be. We’re looking for someone with the vision, background, experience, and skills to help us form the next chapter for The Foundry Network and to continue to grow and adapt how we work with our ecosystem in ways that support and empower our portfolio of companies and VC funds.

ABOUT US
Foundry Group is a venture capital firm that invests in early-stage technology companies and venture fund managers. Our passion is working alongside entrepreneurs to give birth to new technologies and to build those technologies into industry-leading companies. We also seek to leverage our experience and relationships as fund managers to help the next generation of venture firms create industry-leading investment businesses. We invest in companies and funds across North America.

SOME INITIAL THOUGHTS ON THE DETAILS OF THE POSITION
We’ve put a lot of thought into the development of our network and need help taking it into the future. Below are a few ideas we have about this position and the future of The Foundry Network. We’re looking for someone who can help us craft the vision, not just execute on ours. So take this as a rough draft. 

As Head of Network you will participate in our weekly partner meetings and be a member of the senior team, which includes our CFO and General Counsel as well as all of the Foundry Group partners. You’ll have access to and know pretty much everything that’s taking place across The Network and our portfolio. At its core, this role will help strengthen connections between the people with whom we work- we believe strongly in mesh networks, not hub and spoke models. We are also excited to continue to expand The Network and the work we do in this area, such as in talent sourcing, data sharing, and community support. 

We’ve historically engaged our network through active digital communication channels, in-person events, virtual events, webinars, and small group meet-ups. Many of these we’ll likely want to continue. Some we may together decide don’t further our key goals any more and will stop doing. And, most importantly, there are opportunities to expand beyond the base that we’ve created to support our portfolio in new and creative ways. 

A LITTLE ABOUT YOU
It’s hard to put into words exactly what we’re looking for because the right person for this role could come from a number of different professional backgrounds. But there are a few things that we know will be important to success in this role and our firm culture. 

This is a relationship-centric role and we are looking for someone who has a demonstrated aptitude for building and maintaining professional relationships. You have built your own network and are driven by helping others succeed and connecting the dots between people and companies. You have connections in and around the tech industry and have interacted with executives at a senior level in prior jobs and experiences.

At Foundry, we are not top-down managers. Our Head of Network will need to be comfortable working independently and own this core functionality of our business You will be included in and supported by the core team, but the role is primarily self-directed. While we will provide input and help you understand our goals for The Network, there is a lot of room for creativity and expansion. 

In addition to creativity and vision, the ability to execute and achieve high-quality outputs are imperative for success in this role. Every senior role at Foundry – including our partners – is an individual contributor. We work collaboratively and in close coordination with one-another, but we do our own work and, while we have people on board to help with implementing events, much of the work of the Head of Network will be not just coming up with ideas, but seeing them through personally. 

We live by a #givefirst mentality at Foundry, and we hope you can show us how you’ve done the same. 

Finally, we want to be clear that this role isn’t a pathway to an investment role at Foundry. We want you to be excited about this role and this position. We think it’s a great opportunity to work alongside us as we continue to build out the Foundry Network.

EXPERIENCE
There is not one particular background that fits this role and we are open to candidates across the board. Given the autonomy of the role, we believe an individual with at least 7 years of professional work experience and who has previously held a senior level role will thrive. We’re focused on how your experiences drive your interest in this position and how they will contribute to your success in this role and at Foundry.

SOME DETAILS
Our firm is based in Boulder, but we’re open to you living anywhere, so long as (once travel resumes) you’re able to be here from time to time (most of our in person events are in Boulder, for example). This is a senior position and will be compensated as such. Additionally, we offer a generous benefits package (fully paid health insurance, along with a number of other benefits). 

Foundry Group is an equal opportunity employer. We strongly encourage and seek applications from candidates of all backgrounds and identities, across race, color, ethnicity, national origin or ancestry, citizenship, religion, sex, sexual orientation, gender identity or expression, veteran status, martial status, pregnancy or parental status, or disability. We are committed to creating a supportive and inclusive workplace. 

NEXT STEPS
If you’ve read this post and think, “this is me!”, we’d love to hear from you. Please feel free to be creative and choose a medium that allows you to express yourself and give us a sense for whether you are a fit for this role. To apply, please contact us at apply@foundrygroup.com. We’d love to hear from you by the end the day on Friday, November 6, 2020 if you’d like to be considered.

AdExchanger just posed an interview that I did with them that touched on some of our ad-tech investments as well as our overall investment philosophy. I’ve cross posted an unedited version of that interview below.

1. Why get into the venture capital side of the business? Do you ever get the entrepreneurial "itch"?

I first got into venture capital about 10 years ago and I love my job. I was running a few business units for a small public company and while I enjoyed the operational side of my job, I was also responsible for M&A and partnerships and had a particular affinity for the transactional side of my job. While I consistently have the entrepreneurial itch, I actually think this makes me better at investing – it reminds me of why I’m in business (to support entrepreneurs who are the real stars of the show). I’ve also co-founded a few companies (including Trada which is a company in the Foundry portfolio that helps advertisers better execute paid search campaigns; I wrote about that experience recently on my blog: https://www.sethlevine.com/wp/2010/08/trada-from-the-beginning) and I’m very close to many of our portfolio companies at an operational level which helps to satisfy the entrepreneur in me.

2. What is Foundry Group’s investment philosophy?

Unlike many venture capital firms that invest in certain geographic regions or specific technologies and sectors, Foundry Group’s investing activity is largely driven by a thematic approach. The themes we pursue tend to be horizontal in nature and are often driven by underlying technology protocols and standards or emerging market trends and customer needs. Rather than looking for short-term hits, we focus on themes that have the ability to drive a cycle of innovation (and hence provide multiple investment opportunities) over a period of five to ten years or more. My partners and I have written extensively about this thematic approach on the Foundry Group blog: https://www.foundrygroup.com/wp/category/themes/

3. You’ve invested in AdMeld, Triggit, Lijit, Medialets and Trada among others in the ad space.  Foundry Group is an advertising start-up "bull" it would appear. Thoughts?

I’m extremely excited about the portfolio of companies my partners and I have put together at Foundry Group which includes some great ad tech companies which you list above. We think of these investments as part of our “Glue” theme – meaning that they’re all essentially connective technologies that help increase the velocity, accuracy, transparency and availability of online advertising. I believe that online advertising is going through an important transition with the rise of real-time bidding platforms and advertisers increasing ability to buy audience vs sites. Our investments in many of the companies above follow that idea. Additionally, mobile is becoming an increasingly important platform as devices become more powerful, more flexible and better connected. Obviously our investment in Medialets – the market leader in rich media mobile advertising – reflects our belief that mobile in general, and rich media on mobile specifically (which is really the kind of advertising that mobile was made for) is a rising area in advertising. We’ve been fortunate to be able to work with some of the companies and people that are at the leading edge of digital media and I think we’ve put together a great portfolio of companies in this area (and I’d add Mandelbrot Project to your list above, although we’re not talking much about what they’re up to yet).

4. What are some key overall, characteristics that Foundry companies share?

I’ll resist the temptation to answer with some superlative VC cliché about how great all our management teams are or disruptive the underlying technologies are becoming.  Rather, I’d say that the one truly common trait across our portfolio of companies is the obsession these businesses have with their product. This product obsession starts with the CEO and pervades the management teams and operations of our companies. They eat, sleep and breathe product.  From my perspective the results of that obsession is obvious when you look at what each of our companies is doing to change their respective markets.

5. Can you identify a couple of common errors that entrepreneurs make when raising funds?

I think there are two relatively common mistakes that entrepreneurs make when fundraising. The first is trying to do too much in the first meeting. The goal of that meeting isn’t to sell the investor on making an investment, it’s to whet the investor’s appetite and leave them wanting to learn more. Entrepreneurs should structure that first interaction to do exactly that. The second most common mistake is not asking what the process is on the investors side and as a result mistaking activity for progress. Every firm (and angel) has their own process – understanding that process and making sure you know how a firm reaches a decision (who has to be won over, in particular) is extremely important. The adjunct to this point is that while relatively few entrepreneurs methodically do it, it’s important to perform due diligence on the investors you’re talking with, just as they’ll be performing due diligence on you. Find entrepreneurs they’ve worked with before, in particular those at companies that didn’t work out as planned, and ask how the firm and the specific partners were to work with. You can also use this as a chance to understand from a third party both the partnership dynamic within the firm as well as what their perspective of the investment process looks like.

6. Given the scope and size of Foundry Group’s investments today, it would appear you’re at an inflection point.  At the very least, your current group can only manage so many investments after all and the fund itself is nearly fully-invested is it not? What’s next?

We have a very specific, and somewhat non-traditional view of the firm we’re building at Foundry. Our intention is not to create a legacy or have a business that survives the 4 founding Foundry partners. We have no associates at the firm and all do our own work. Our current fund is $225m and our intention is to raise a series of funds of the same size and then be done. As we like to say: “last one finished shuts off the lights”. To be clear about where we are as a fund and a firm, we have plenty of capacity to continue to make new investments.

7. Can you talk a little bit about the growth of the Boulder startup community and what makes it unique to other startup communities such as Silicon Valley, NYC, Boston, etc.?

I think Boulder is increasingly becoming known as one of the leading start-up cities in the United States (for example, here’s a recent BusinessWeek story naming Boulder the #1 city in the country for start-ups). And I can tell you from living here that there is a ton of great energy in this community – from TechStars (which started here) to the Boulder Open Coffee Club, to our local NewTech Meetup to Ignite Boulder. Interestingly (and somewhat different than other markets) the Boulder start-up scene is both very distributed (there are a large number of leaders in the Boulder start-up community) and collaborative. I don’t know that I’ve ever been in a city where people involved in start-ups were as willing to help each other out as they are in Boulder.

8. What are your thoughts about M&A and IPOs – and a successful exit for ad tech startups? Do you see a window developing?

We’ve all seen the global statistics – August was an unusually strong month for mergers and acquisitions. The interest rate environment as well as the relatively large cash balances of many large corporations appear to be driving somewhat of a resurgence in acquisition activity. I’m cautious that these high level data (driven by large global transactions) will be both sustainable and mean an more favorable overall environment for venture backed businesses. The time I’ve been in the venture capital business has been perhaps the worst IPO environment since the venture asset class came into being, so I’ll refrain from making any predictions about whether we’ll see any kind of sustained resurgence of the IPO market (but we can all hope together….)

9. If a startup wants to get a meeting with a VC for potential investment, any tips? Any tips on pitching Foundry Group in particular?

If you have a direct (or indirect) path to an introduction – through another entrepreneur or someone else you know – that’s always the best way in to any VC. It provides additional context which is helpful. That said, many VCs these days (Foundry included) are pretty open about what they’re interested in. I always appreciate it when people engage with me on topics that I’m writing or tweeting about. And to give this some additional context, Foundry has funded several companies that first reached out to us because of a blog post (including one company where our first communication was through Twitter).