on the table and have an honest conversation. The more honest you are the better working relationship it will be. Jason referenced Thumbtack early, one of the things we liked most about their pitch was when we asked questions they didn’t know, and they said they didn’t know, and then they dove into their database to look it up. It showed us they are intellectually honest and data focused. Scrappy high velocity: we like businesses that get stuff out there. Iterate on a product and push it; see how customers react to it and make adjustments. Do things quickly. Especially in the beginning stages of a company. You don’t have all the answers. You just have to try things and make adjustments. We don’t like companies that spend months discussing every little change they’re going to make. Mission driven passionate: you have to be doing the startup for a reason. There is a goal you want to accomplish, and you walk through fire to accomplish it. Great at recruiting people: team is everything at the end of the day. You need to bring in A plus players. This will be the difference between becoming huge or just decent. This is how series a investors should see your business: very clever, unique, and solving a major pain point that has not been solved; if it is being solved, then it is being solved poorly. Your product needs to have a huge Total Available Market (TAM); it needs to be in the billions of dollars, this doesn’t mean that if you are building an eCommerce website, then you will give me the whole TAM for E-commerce. That is not your TAM. Whatever your true TAM is should be in the billions to get a fund from our size (which is anything over a hundred million dollars). You should be able to show that that is actually your TAM. Creating both a substantial revenue stream and strategic value is important to us. We don’t want you, when you succeed down the road, to be acquired for some multiple of revenue which is a preset number. We want you to be bought for some huge premium because multiple companies must have you and can’t imagine their competitors having you. And thus they are willing to pay out for you because of that strategic value you have created. Leverage is important, potential for explosive growth, with revenue being able to grow much faster than expenses — so scalability. Your business should be a business that people want to work for. It is solving some sexy problem or it is so scaleable and explosive that it would be really fun to work on. Very focused: we tend to run away from companies that want to boil the ocean; companies that are trying to do way too many things at once. It’s fine once your company gets more mature, but at the beginning you have to do one thing really well. Having great product DNA and marketing DNA is crucial to us. If you just have one or the other, then the business never grows. You have to figure out what to build and how to get customers to want it. What you build needs to be hard to duplicate and compete against. Choosing which VCs to approach: fund size and investment amount must match. If you are raising ten million dollars for series A, then you don’t go to a fund that is 40 million dollars. Identifying a champion is really important. You have to find the partner in the firm that is going to shepherd this through the internal conversations. He will help you with your presentation and give you feedback. He will make sure that if there is a risk you, then you will have an opportunity to deal with that risk. You want to find investors where the board member that would be joining your company would actually be helpful. I’ve been on many boards where one of the members is just a time suck and creates all this stress for the entrepreneur. Pick someone who you love working with; think of them as a partner or co-founder. It is better if they have relevant skills or network that can help you. The investor is not just an advisor. The investor is somebody who you should think of as a constant or brainstorm partner. He is someone who you can email/call at 10 o’clock at night and they will take it; he is in it on a such a frequent basis that he knows what is going on, and their advice is actually relevant. Venture capitalists will be both empathetic and brutally honest. Jason is great at that. Everyone knows he is honest. But he also has a lot of empathy for how hard it is to