Cloud 100 – NYC !

As you may have seen,  Forbes published the Cloud 100 , here is their description: Forbes Cloud 100 recognizes the best and brightest of the cloud. Compiled with the help of partners Bessemer Venture Partners and Salesforce Ventures, the list tracks candidates by operating metrics such as revenue and funding, with the help of 25 of their public cloud CEO peers.

Out of the 100 companies, 13 are based in NYC, specifically in Manhattan, see images below.  One of the great things about the startup scene in NYC is the density of companies, these companies are all in walking distance, less that 4 miles separates the most northern company to the the southern company.  I highlighted the density aspect in a previous post when looking at the locations of Fortune 500 companies (spoiler alert, 42 are based in Manhattan).

Startups (& VCs) have realized the sales opportunity that NYC provides and we are going to see an acceleration of SaaS companies being built here.

 

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LPs and Diversity

A lot has already been said and written about what is happening in our tech community with regards to how Women Founders are being sexually harassed and/or assaulted.  Recently, several Men have lost their jobs (careers?) for their behavior and I suspect others will too.

In addition to vocalizing how this is an issue, what actions can we take to improve things? While Women are at the center of the recent discussions, I do want to expand the conversation and include minorities in our community, as they are being impacted due to racism.

One of the most important areas we need to work on is diversifying the GPs (General Partners) of early stage VC funds.   The reason I say early stage funds, is that they are usually the first to financially support a startup, at a time when the company has very little data/revenue, so the VC is making a big bet on the Founders(s).  As you can see below, 92% of senior investment professional (GPs) are Men.  78% of GPs are White. The image below was via an article written by Kim-Mai Cutler in 2015.

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The fact that there is a lack of diversity in the senior GP ranks, isn’t news but it is worth to highlight this again, especially for LPs (Limited Partners) who are reading this post (hopefully they are).  White males are not more capable of running firms than other gender(s) or ethnicity.   I believe that LPs have the most power in changing the make up of how VC firms look.   We need LPs to think about diversity when they invest their capital in VC funds, so how can we help?

Specifically, we need to mentor new and diverse VC funds (aka Emerging Managers).   We need to help leverage our LP rolodex to get these firms access to capital.  We need to help provide high quality Founder referrals.  We need to get these professionals engaged in industry events/dinners that we organize.  We need to ask these firms, “how we can help”, as every firm has different needs.  I don’t want to assume that everyone is looking for help or needs help but it doesn’t hurt to ask them if they need help.

If you are a VC, are you willing to share some of your LP connections?  Are you willing to invite these firms into your syndicate?  Are you willing to invite them to your dinners and/or speaking events?

Given that I’m based in NYC, I want to take this time to highlight diverse emerging managers based here.   If you are LP and haven’t already spoken to these firms, it it worth exploring why that is and finding time to connect with them (assuming they want new LPs now or in the future).

  • 645 Ventures
  • AlphaPrime Ventures
  • BBG Ventures
  • Female Founders Fund
  • Flatiron Investors
  • Future/Perfect Ventures
  • Human Ventures
  • Lattice Ventures
  • New Age Ventures
  • Primary Ventures Partners
  • Rucker Park
  • SoGal Ventures
  • Startup52
  • Techstars IoT
  • Third Kind Venture Capital
  • Trail Mix Ventures
  • WME Ventures 
  • Work-Bench
  • XFactor Ventures

Please let me know if I missed any firm(s).  This list is comprised of firms who meet all of the following criteria:

  • HQ’d in NYC
  • raising Fund I/II and/or currently investing out of Fund I/II
  • General Partnership is comprised of at least one woman and/or minority.  This person has to have substantial carry (which to me, means they are one of the leaders of the firm)
  • Early investment focus (Seed/Series A)

The point of the post is not to throw LPs under the bus, but it is fair to say they could be doing more to change the diversity of firms.  That being said, every stake holder in this community (including me) has a role that they can play in making changes that improve the makeup of VCs (and Founders).  It is worth taking time to think through how you personally can be helpful, I’m still thinking through it and welcome any feedback/thoughts.

My commitment is to help the above mentioned firms.  I have helped a few of them already but need to do more.

 

 

Summer Internship 2017

We (SVB) are seeking an amazing intern for the Summer of 2017.

The past interns that I’ve hired have gone to do some interesting things in the startup/venture community:

  • Kevin Carter, who subsequently joined SV Angel as an Associate and is now a Partner
  • Chaz Flexman, who subsequently joined SVB full-time, then worked for A16Z and now is VP of Strategic Relationship at PCH International
  • Thomas Knowles, who subsequently joined the SVB venture arm and is now a Partner at Gratitude Railroad (a VC fund in Utah)
  • Dimitris Kouvaros, who subsequently and recently became a Director at Newark Venture Partners (a new VC fund / Accelerator)
  • Lorel Sim, who was our most recent Intern this past Summer, she is currently a Sophomore at Stanford and will no doubt be doing interesting things in her career

Here are the characteristics that the candidate must possess:

  • PASSION for the startup community
  • Articulate (both in writing and presenting)
  • Takes initiative
  • Hard worker
  • Have an opinion (let me know which sector(s) you are excited about)

If this sounds like you and can clearly demonstrate the above characteristics, please fill this out:  google doc

A few key points to highlight:

  • This is a paid position (~$15 / hour)
  • Ideally, the candidate is currently a Freshman, Sophomore or Junior
  • Start date would be around June, flexible depending on your class schedule
  • Could be either full-time or part-time
  • Position is based in NYC
  • Ideally, the candidate lives in NYC, in case we would like to extend the internship beyond the summer
  • You get to work directly with me 🙂
  • All the work you will be doing is squarely focused on data/metrics regarding the startup/vc community.  A lot of ad hoc projects around venture funding/activity, sector analysis, portfolio reviews, assisting with blog posts, working with CRM, etc.
  • I will review applicants in Jan/Feb/March and make a decision in early April.

About SVB:

In short, we are the leading global commercial bank for entrepreneurs and investors.  A more detailed overview is provided below.

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VCs who back the best* startups in NYC

Recently went through the exercise of creating a list of the best* startups in NYC.  The companies ranged from seed funded startups to Pre-IPO companies (so, all are still private).  The process was partially data driven, partially based on word on street and partially based on my interactions with the founders of those companies.  It was really more subjective than anything else.  Ended up coming up with a list of ~60 startups.

Decided not to share the list, as it was really more of exercise to see if it was possible to narrow the list down to manageable number.   The good news is that there are so many exciting companies in NYC, that is was a very tough process to get it down to 60 startups.

One insight I thought would be interesting to share, is which VCs most frequently show up as backing these best* companies:

  • Box Group – 7 investments
  • First Round Capital – 7
  • Lerer Hippeau Ventures – 6
  • Thrive Capital – 6
  • Google Ventures – 5
  • Founder Collective – 5
  • Index Ventures – 5
  • Accel Partners – 4
  • Iconic Capital – 4
  • Union Square Ventures – 4
  • Wellington Management – 4
  • Institutional Venture Partners – 4
  • RRE Ventures – 4
  • New Enterprise Associates – 4
  • Battery Ventures – 4

There were many other VCs that showed up, but the list above reflects the firms that are most active in backing the best* startups.

Now, I think the early stage VCs deserve more credit than the later stage VCs, as the late stage folks have data/revenue to hang their hat on.  So, just take that into account when reviewing the list.

PS If you put together a list of your top 60 NYC startups, happy to meet up in person and debate the list over coffee.

*this list wasn’t produced by any scientific means, was mostly subjective and we will likely disagree on the outcome.  Please send the hate mail to Santa Claus, PO Box North Pole 🙂

 

 

 

NYC sub-sector trends in 2016

Many people ask what is happening in the NYC startup scene and they still assume it is mostly adtech, commerce and content.  That might have been true in the past, but it’s not what is happening now, at least based on anecdotes and what I’m seeing.  Decided to do use some data to determine if this accurate.  Used Pitchbook to this query:

  • Seed and Series A rounds
  • rounds done in 2016
  • NY HQ’d companies

 

Below is the dollars & percentage breakdown of sub-sector activity.

The surprising trend will likely be that SaaS is leading all the sub-sectors.  Second, the trend in healthcare, big data, AI/ML will be an eye-opener.   Overall, NYC is really balanced in terms of sub-sectors and isn’t overly dependent on one to drive future returns.

I would like to see more VR/AR related startups, given how much content companies and studios are based here.

What are you thoughts on this?  What are we going to see more of in 2017?

Industry Vertical Capital Invested (in M) Percentage
SaaS $313.77 17.7%
E-Commerce $286.55 16.1%
Mobile $272.14 15.3%
FinTech $250.60 14.1%
HealthTech $135.28 7.6%
Big Data $100.43 5.7%
Artificial Intelligence & Machine Learning $72.75 4.1%
Marketing Tech $51.14 2.9%
Internet of Things $43.84 2.5%
Lifestyles of Health and Sustainability $36.84 2.1%
AdTech $33.19 1.9%
Manufacturing $30.75 1.7%
EdTech $22.08 1.2%
Cybersecurity $21.60 1.2%
Life Sciences $21.20 1.2%
Wearables & Quantified Self $20.75 1.2%
Virtual Reality $17.41 1.0%
Robotics and Drones $14.92 0.8%
3D Printing $10.05 0.6%
AudioTech $9.75 0.5%
Nano-technology $6.70 0.4%
CleanTech $3.00 0.2%
$1,774.74 100.0%

We are hiring in NYC

Silicon Valley Bank is continuing to hire in NYC.  The office has rapidly grown with the startup community and we are excited about the opportunities ahead.

My group is hiring and am looking to spread the word to find a candidate for this unique position.

We are looking for a senior professional who will work closely with emerging managers (if you don’t know this term, probably not a great fit for the role).  

The role is focused on helping emerging managers with how they go to market, how they think through their fundraising process and connecting them to our network, which will improve their odds of success in this difficult industry, where 3x+ DPI is expected by LPs.  This role is not an investment position (in startups or funds) but one where you enable great investors and earn the role to be their trusted adviser.

This person HAS to be passionate about venture capital, founders, startups, limited partners and technology.  In addition to having the passion, this professional needs to have contacts in the industry, ideally with existing emerging managers and/or LPs who invest in their funds.

This role is based out of our NYC office at Bryant Park.

This professional has to have the flexibility to have detailed conversations with the four groups posted below.

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If this sounds like you, please email me at sgoldman at svb dot com

Thank You

Looking for Mentors in NYC

As you may know, I’m involved with a non-profit called BUILD.  I was a mentor when I used to live in the Bay Area and it was a very rewarding experience during my four years with them.  In addition, I joined the NYC board of BUILD in January, to help them launch here.

The mission of the organization: Through entrepreneurship-based, experiential learning, BUILD ignites the potential of youth in under-resourced communities and equips them for high school, college and career success.

Some of the students who are enrolled in BUILD have no aspirations to attend college, we want to change that.  If it wasn’t for the students’ involvement in BUILD, they might not have graduated from high school.  As a mentor, you have the ability to positively impact the path that these students are on.

BUILD was founded in 1999 and it is finally launching in NYC, having proved out their programming/model in the Bay Area, Boston and in D.C.

This upcoming October ’16, 500 local high school Freshman will be enrolling in the BUILD program.

We need 100 mentors to support these 500 students.  As of now, we have 50 mentors committed and need another 50.

There is a significant time commitment by the mentors:

  1. Program goes the entire school year, October ’16 to May ’17
  2. One hour per week (some weeks off due to holidays/vacation breaks)
  3. Sessions are in the afternoon at the students’ schools (locations are in Bronx, Manhattan, Brooklyn)

Who are out Mentors?  They are professionals who are dedicated to serving the students and have the flexibility in their work schedule to spend time with them once a week.  Mentors are providing guidance from a business/life perspective, you don’t need to have a technical or startup background to participate.

If you want to get more information about become a mentor, visit the mentor site or if you feel you are ready to apply to be a mentor, email Miranda Bellizia at mbellizia@build.org .

Thank you for reading this far.