The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

20VC: The Acceptable vs Unacceptable Risks To Take When Seed Investing, Why Loss Ratio Is Not A Consideration & Why Series A Is The Right Time To Establish A Board with Mike Hirshland, Co-Founder @ Resolute Ventures

Mar 18, 2019

Mike Hirshland, co-founder of Resolute Ventures and former partner at Polaris, shares his journey from legal clerk to venture capitalist. He discusses the nuances of seed investing, identifying acceptable risks, and why some firms shouldn’t operate with large funds. Mike emphasizes ownership over loss ratios, advocating for strong founder-VC relationships and the need for diversification in portfolios. He also explores an exciting investment in a new SaaS startup, showcasing the essential resources that support emerging entrepreneurs.

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ANECDOTE

Path to VC

Mike Hirshland's interest in VC sparked after a conversation with John Doerr about the browser wars and Silicon Valley.
This led him to Polaris Venture Partners after working for the US Senate Judiciary Committee.

INSIGHT

Founding Resolute

Mike Hirshland founded Resolute Ventures due to the difficulty of seed investing within a large fund.
His passion lies in working with early-stage entrepreneurs, even before they have a clear company.

INSIGHT

Old Seed Stage

Resolute Ventures invests at the "old seed stage," focusing on pre-traction companies.
They prioritize strong teams and compelling ideas over demonstrable market traction.

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Mike Hirshland is the Co-founder of Resolute Ventures, one of the leading pre-seed and seed stage funds of the last decade having recently announced their new $75m Fund IV. In prior funds they have the likes of OpenDoor, Mixmax, Greenhouse, AppZen and more incredible companies. As for Mike, prior to founding Resolute, he founded Dogpatch Labs, the community which helped launch over 350 companies including Instagram. Before Dogpatch, Mike was a partner with Polaris Venture Partners from 1999-2011, where he was the original seed investor behind Automattic, Q1 Labs (acquired by IBM for $600 million), Quantcast and KISSmetrics.

In Today’s Episode You Will Learn:

1.) How Mike made his way from a legal clerk in the US Supreme Court to founding his own venture firm in the form of Resolute Ventures?

2.) What does Mike mean when he says Resolute invest at the "old seed stage?" What stage of development and traction are the companies at this stage? Why does seed investing out of a $Bn fund not make sense to Mike? What are the acceptable vs unacceptable risks at this stage?

3.) How does Mike think and assess portfolio construction today? How many lines in the portfolio is enough to be sufficiently diversified? How does Mike think about ownership given his thesis on diversification? How does Mike assess his own price sensitivity today? How does Mike think about loss ratio within the portfolio today?

4.) What are the ideal attributes of the founder/VC relationship to Mike? Is it right for the investor to also be friends with their founders? What can founders do to really build and deepen relationships with investors both during and outside of official fundraises? Where does Mike often see founders making mistakes here?

5.) How does Mike think about the right time to establish a board? What does Mike advise founders in terms of board composition in the early days? How does Mike look to build a sense of "board intimacy" with his founders? Why does Mike believe that there is a "counter-productivity to boards at seed"?

Items Mentioned In Today’s Show:

Mike’s Fave Book: A Little Life

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