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I’m thrilled to announce that I’m joining Primary Venture Partners as a Venture Partner. Over the last six years, Ben and Brad have been co-investors, thought partners and friends. Ever since the fall, they have been helping me think through a number of paths I have been exploring. That discussion evolved over many months, to the point where it became clear that we had a lot to gain from each other. This started as a super casual, “Hey, why don’t you come hang out for a while,” thing and evolved from there to the point where we realized it made sense to combine forces.

Ben, Brad and the rest of the Primary team are arguably building the most hands-on and operationally minded Seed fund in NYC. They do not spray and pray. They are active, high-conviction lead investors, and they care deeply. They are also focused exclusively on NYC, which was a huge factor in my decision. Everyone at the firm deeply believes in this ecosystem, and that is reflected not only in their strategy but also in how they are building the firm. Most importantly, everyone around the table has operational chops, strong values and a real desire to help NYC founders build impactful companies.

As I have peeled back the curtain and talked with founders in the portfolio, I have been blown away by the Primary platform. The firm’s Portfolio Impact Team, comprised of dedicated Talent, Finance, Market Development and Communications pros, is designed to support companies from whiteboard all the way to Series A and beyond. Additionally, the Primary Expert Network, a network of over 200 seasoned technology operators and functional experts, helps founders solve their most pressing tactical problems. They’re just getting started, too. Many firms these days claim they have a platform, but it’s often just “checking the box.” Not Primary. They’re investing aggressively and playing the long game to build a real franchise here in NYC.

Many people have asked me, “So what is a Venture Partner?” The title means different things at different firms. Here’s what I’ll be focused on: My first mandate is to find and partner with amazing founders building companies here in NYC. I’m amped to get back into the investment game after a brief hiatus. My second mandate is to help the firm with overall strategy. Over the last decade, I’ve been fortunate to work at some amazing firms and learn from many incredible investors and founders. I’m going to share lessons learned and potentially help operationalize some new programs. The third mandate is to support the existing portfolio with ad hoc executive coaching. I’m currently enrolled in an intensive transformational/executive coaching program, and I look forward to deepening my practice with the Primary family. Finally, I’ll have some freedom, space and time to explore a range of longer-term projects and paths.

Monday is my first day at Primary and I couldn’t be more excited to get started. If you are a founder or operator in NYC and are looking for advice, capital and/or executive coaching, my email is steve@primary.vc. Drop me a note to say hello. I would love to support you on your journey.

Raising money from VCs is an important step in the company building process. It marks the beginning of a long-term relationship that can last longer than a decade. In my experience investing in and advising countless founders, company building is not rainbows, unicorns and lollipops. Startups are filled with adversity, challenge and struggle. That’s why it’s critical to find the right investors who are going to support you when times are good and have your back when the shit hits the fan. It likely will at some point on your journey.

Fundraising should be viewed as a two-way dialogue. Each side should interview the other. While I understand and appreciate the desire and pressure to quickly raise and get back to work, taking enough time to really get to know your partners is a good investment of time and effort. This goes for both sides. If the VC you’re meeting with doesn’t want to spend the time or directly answer your questions, that should be a telling sign. Going into any long-term partnership with eyes wide open is just a smart strategy. Remember, all relationships are complicated. The healthiest ones are built on shared values, open communication and mutual respect. That’s why it’s worth spending the time upfront and understanding who your investors are before they write the check.

So how do you cut through the VCs sales pitch and really get to know the investors during the fundraising process? It starts with asking thoughtful and targeted questions. Be curious. Your objective throughout the process shouldn’t be to interrogate and incriminate but rather to find the right fit and long-term partner(s) for your business. Go for a walk with them. Grab a meal or a coffee. Really get to know them.

If you’re unsure what to ask or what is in bounds, you’re in luck! I’ve created a fairly exhaustive questionnaire that you can reference while you’re on the fundraising trail. Most of the questions are relevant if you’re talking to an institutional VC while some might not be if you’re talking with angels. Know your audience. I recommend doing some research and trying to answer as many as you can before the meeting so you can focus on the most important ones. You won’t have much time so choose carefully.

I hope you find this to be a useful resource before or while you’re on the fundraising trail. Remember, don’t settle or rush the process even if you have ample options. Having the right investor, who is not only a good fit but also will have your back, can be a difference maker. Godspeed!

The Juicy Ones

What makes you uncomfortable about our company? What do you like?

Who in your partnership is going to push back? What are they going to say?

How do we fit your investment thesis and / or align with your worldview?

On a scale from 1–10, how good do you feel about our company right now? Why?

Where are your blind spots with respect to our opportunity?

Can you name a time you stood up for your company in the face of opposition from your partners or other investors?

How have you / the firm handled companies that have underperformed relative to expectations? Can you share some examples?

How would your founders describe you when you weren’t in the room?

Do you engage or disengage when things get difficult?

How do you handle the pressure?

About The Fund

Can you tell me a bit more about Acme Capital and your current fund?

How many partners do you have? Are they generalists or sector-specific experts?

What is your ideal stage?

What is your average check size and do you reserve for follow-on investments?

Do you lead and take board seats?

How does your firm define a “core” investment? Would we fit into that camp?

What are your return expectations?

How large is your current fund and how many more investments do you have left to make?

How does the firm think about bridge rounds or extensions?

Do you have any category or geographic limitations?

What are the last three investments your firm closed and what got you and the partnership excited?

Who are some of your favorite and frequent co-investors?

How can the firm help us build the syndicate for our next round?

The Partner / Investor

What experience or perspectives do you have that are relevant to our company?

What’s your superpower?

What are your core values?

Why did you become an investor?

How many board are you on? How much time do you have for each company on a monthly basis?

Have you ever fired a CEO? What happened?

How long does it take for us to schedule a meeting and / or get on a call?

Do you believe in the partner or the platform?

How would your founders describe you?

What’s your style (hands-on, data-driven, etc.)

What are two or three examples of how you’ve added value to your portfolio in the last month?

Investment Process

Are you running point or will someone else take the baton?

Can you describe your investment process in detail?

Do you have the authority to lead investments or do you work with a partner?

How does the firm make decisions?

How will I know where I am in the process?

On average, how long does the process take from first meeting to close?

Portfolio

What are some lessons you’ve learned from your portfolio that you could apply to our company?

Which companies in your portfolio could we learn from?

Who in founders or operators in your portfolio would be good for us to know?

Do you have any conflicting or tangential companies?

Support

How do you think you could help us?

What’s the firm’s philosophy and strategy on support?

How have you supported companies like ours?

Do I get you and/or the firm? Can you explain?

How do you work with your companies?

Last week, I bumped into a buddy who runs a fairly large venture-backed company. I asked him how things were going. Rather than getting the common response, “everything is great,” he explained that he had spent the last few quarters developing a new product only to discover the customer response has been lukewarm. He said this experience stung because countless hours and hundreds of thousands of dollars were spent building the product. He had also used up significant political capital with his Board. He asked me what I thought. I simply replied, “Don’t let the sunk costs get in the way of deciding what’s best for the business.”

A sunk cost is a cost that has already been incurred and cannot be recovered. We all experience sunk costs in our personal and professional lives. They can include money spent, time, effort and energy. Sunk costs play a big role in startups and investing. Startups and investors are faced with a barrage of sunk costs on a regular basis:

• Spending huge sums of money to develop a product only to discover there isn’t a market for it
• Hiring a key executive only to discover he or she isn’t a fit
• Making a big promotion only to realize the employee isn’t set up for success
• Naming your company and buying a domain only to find another company has the trademark
• Launching a large advertising campaign that doesn’t produce results
• Hiring expensive recruiters or consultants that don’t deliver
• Investing in a company that doesn’t perform relative to expectations

A lesson I learned in school and throughout my career: valuing and harping on sunk costs often leads to poor decisions. It is human nature to try to salvage an investment of time, money, energy and effort. Avoid the trap. They are counterproductive when making forward-looking decisions. They are often an illusion. Don’t let them get in the way. Treat the money, time, energy and effort as gone forever. I realize moving on can be painful and feel barbaric but it can also be liberating.

Whenever sunk costs are influencing decisions, I always recommend coming back to this question: ‘what’s best for the company going forward?’

As an investor, this often presents a dilemma. Investment theory suggests that any incremental dollar invested in a company should be evaluated separately from the initial check. I typically subscribe to this principle. It is sound and responsible. But what happens if a company is in a tight spot and needs additional investment to get to that next critical milestone or achieve an outcome? Is declining an investment in this situation truly in the best interest of the firm? I would argue that most often it’s not.

Venture, especially seed investing, is a human-driven and long-term business. My reputation is all I really have. If I don’t step up in times of need, I’ll eventually develop a bad reputation and founders won’t want to work with me. Being a supporter in tough times is not only the right thing to do from a human and karmic perspective but I also believe it will result in better returns over the long run.

Dealing with sunk costs isn’t so black and white after all. There are grey areas that ultimately challenge our values. If you just focus on what’s best for the company in the long-term you can’t go wrong.

(My dad this summer in Woodstock, NY)

I recently read an excellent essay by Andrew Kortina titled, “They Say the #1 Killer of Old People is Retirement.” In this piece, he discusses the importance of finding purpose and meaning deep into life. Andrew outlines a confluence of factors that are causing mental and financial hardships for baby boomers. Many are struggling emotionally and financially for a variety of reasons including lack of savings, meaningful work and intellectual stimulation. He proposed several interesting solutions based on this simple idea: “I think we can help people continue to feel productive and valued by instilling them with some sense of greater purpose after retirement.” Kortina’s post conjured thoughts and feelings about my father who recently turned seventy-five.

Several years ago, dad was in a tough spot mentally. He had aged out of the workforce and just experienced his second divorce. Additionally, he was living alone for the first time in nearly thirty years. While he had some savings and a predictable income stream from Social Security and an annuity he purchased, this cushion likely wouldn’t be enough if god-forbid there was an emergency or if he is lucky to live beyond his mid-eighties. During this period, my dad would run errands, go to the gym, watch sports and hang around the house on most days. That was his routine. My siblings and I could tell he was depressed, lonely, hopeless and stuck in a vicious cycle.

My dad’s situation isn’t unique. There are more than 70.4 million baby boomers in America according to the U.S. Census Bureau. Workforce participation among boomers is on the decline. Nearly half of boomers haven’t saved for retirement and sixty percent are relying heavily upon Social Security to be their safety net (link). Furthermore, one in seven boomers is treated for depression, which is a higher rate among other generations of American adults (link). Finally, divorce among Boomers is increasing. The number of divorces among that age demo has doubled since the 1990s (link). When looking at the various data points, it turns out that my father isn’t an outlier.

One day last year, I was having a heart-to-heart with my father. We were trying to brainstorm hobbies, odd jobs, volunteer opportunities and local organizations where he could spend his time and perhaps earn a few bucks. I suggested joining the local senior center. That idea didn’t resonate because he still felt young and couldn’t identify with being a senior. We talked about him becoming an usher at Fenway Park since he loves the Red Sox. That likely couldn’t work given the night games and the forty-five minute commute to and from Boston. He suggested working at a friend’s restaurant as a host but they’re only open for dinner. My brothers and sisters also got involved and suggested a bunch of ideas but none seemed to stick.

I felt like we were at a dead end until one afternoon when I was talking with my father about his situation. For some reason in that moment, Viktor Frankl and his seminal book, ‘Man’s Search for Meaning,’ suddenly came to mind. The book chronicles Frankl’s experiences in the Auschwitz concentration camp during World War II, and describes his psychotherapeutic method, Logotherapy, which is founded on the belief that human nature is motivated by the search for a life purpose. Fulfillment achieved through pursuit of meaning in one’s life. Frankl famously wrote, “Everything can be taken from a man but one thing: the last of the human freedoms — to choose one’s attitude in any given set of circumstances, to choose one’s own way.” In that moment, I said to my dad, “You need to find something that will give you purpose and meaning in life.”

Several weeks later, I got a call from him and he sounded upbeat. He proudly announced that he was going to apply to be a substitute teacher in the local area. While my dad was a sales executive for most of his career, he has always had a passion for teaching, coaching and helping youth. I could tell he was excited about this potential opportunity and this could be the solution he and my family had been looking for. He approached the application and interview process as if he was going for a full-time job with a Fortune 500 company. He prepared for hours, gathered strong references and followed up after each of his interviews. He left no stone unturned. It wasn’t very long until he had a job as a substitute teacher in multiple school systems.

Today, my father is a full-time substitute teacher at Salem High School. He loves going to school every day and interacting with the students and the faculty. They challenge him (in a positive way) and help him remain young at heart. No job at the school is above him. He’d mop the floor if they asked him to. He’s contributing in his own way. He’s healthier physically and sharper mentally. He believes he’s making a difference. At age seventy-five, he has managed to find his calling in life. Isn’t that amazing? Most importantly, my dad has finally found meaning and purpose in life. I honestly haven’t seen him this happy and fulfilled in the last twenty years. Every few weeks, my dad will thank me for encouraging him to seek meaning and purpose. The nudge, while simple, was all he needed.

So why did I tell my dad’s story? I feel it’s our generation’s responsibility to help our parents and elders find meaning and purpose should they need a compass. They paved the way for us and now we’re standing on their shoulders. There’s so much we can learn from them. There’s a good chance that we’ll want the same support and guidance from future generations. Helping boomers find a new north star might be one of the biggest untapped opportunities that not enough smart people are focused on. Sure, there might be economic upside in cracking this nut, but I feel there are far larger benefits: less-depression, more quality time with loved ones, better relationships, more independence, healthier bodies and minds, and hopefully longer lives. That seems like a no-brainer to me.

My First Think Week: Going Off The Grid for Exploration and Reflection

Earlier this month, my good buddy, Mike Karnjanaprakorn, Founder / CEO of Skillshare, stopped by our place in the Catskills for a few hours. He was just coming off his seventh ‘Think Week.’ Over lunch, Mike explained the inspiration behind this annual ritual and outlined the basic structure he has used over the years. He even wrote a useful blog post about his experience a few days later.

Mike initially got this idea from Bill Gates, who takes these weeks several times a year to find inspiration and go deep into a few areas of interest. Bill would also read a variety of essays and briefs written and submitted by Microsoft employees and researchers. In fact, Bill dedicated one of his Think Weeks in the 90s to understand the coming wave known as the internet (see his memo, “The Internet Tidal Wave”). Several other friends have recently taken a Think Week. This includes Dan Teran from Managed by Q who swore by his experience diving deeply into the future of work.

After talking with Mike and Dan, I decided to plan my own Think Week since I’m in a career transition and likely won’t have much downtime once I decide to go full force into my next endeavor. My first order of business was to block out five days on the calendar. Rather than flying by the seat of my pants once the Think Week kicked off, I dedicated a half a day to develop a list of simple rules, set goals, clean out my Pocket, and select dozens of essays and articles. I reasoned that having structure in place would help me focus and get the most out of my experience.

Putting some simple rules in place was helpful to ensure I created a conducive environment for learning and reflection. Here are the rules that I observed throughout the week. Stick to your themes or areas of interest. Build a firehose of content that aligns with those themes and your overarching goals. Rise by 6:30am and lights out by 11pm. Meditate first thing in the morning. Exercise daily before lunch. Take a walk in the late afternoon. Remove all distracting apps from your devices. Limit Wifi and web browsing. Schedule no meetings. Check email once per day for no more than fifteen minutes. Limit phone calls to no more than two per day. These rules were essential boundaries for keeping my ADHD in check. I recommend you create you own simple rules if you embark on your own version of a Think Week.

Once I had these simple rules in place, I then developed a list of outcomes I was hoping to achieve during the Think Week. The first goal was to develop three personal and three professional goals for the next twelve to fifteen months. The second goal was to determine one focus area for the next twelve to fifteen months so I know exactly how to spend my time. The third goal was to satisfy my intellectual curiosity. The fourth goal was to journal and find inspiration for future blog posts. The fifth and final goal was to take notes on the readings so my learnings were captured.

Finally, I selected a range of subjects that have been top of mind for me lately. I purposefully didn’t choose just one topic because I badly wanted to satisfy my intellectual curiosity and there wasn’t one topic that I felt passionate about. I ultimately decided to spend my time diving into a dozen or so various topics. These included crypto, china, decentralization, philosophy, augmented reality, artificial intelligence, energy, venture capital, investing (broadly speaking), global health, equality and cities.

The week was more challenging than I anticipated. Being up in the woods without any human interaction was probably the hardest part. By the end of each day, I was exhausted mentally from hours of reading and writing. By the end of the week, my brain was fried, I found it difficult to concentrate and I was craving human interaction. On the last day, I slept until 7:30am, relaxed, went for a long bike ride, and reflected on the big questions that were still weighing on me. While I was able accomplish most of my objectives, I wasn’t able to cover as much ground as I thought I would. I still have dozens of unread essays and articles saved in my Pocket. Also, I was reminded that I’m badly addicted to my phone and it’s the biggest productivity killer in my life. While the full experience was enjoyable, it wasn’t as relaxing and easy as I thought it would be.

Despite the challenges, my first Think Week was definitely positive, rewarding and successful. I’m glad that embarked on this journey and invested the time. I now have clarity on how I should spend my time, what I need to say no to, which areas I’d like to further investigate, the changes I’d like to make, and, most importantly, where I’m heading in the next phase of my career. I’ve found that taking a pause and slowing down is necessary for personal and professional growth. The evidence is clear: I’m returning to the city rested and feeling positive about the road ahead. I still have some anxiety about the future but that’s natural. I’m prepared mentally and ready to embrace the uncertainty and risk that lies ahead.

In closing, I highly recommend setting aside some time for a Think Week if you’re looking to go deep in a particular area, facing a big decision and / or experiencing a life transition. Keep in mind it doesn’t need to be a week to reap the rewards. If you’re unable to take a break from work or get away for five to seven days, consider taking a ’Think Weekend’ or ‘Think Day.’ You can also do it anywhere — it doesn’t have to be in the woods — as long as you create an optimal environment for learning and reflection. With enough advance planning, you’ll be able to block out the time, create your own simple rules, build an agenda that fits your schedule, and zero in on the big questions that you’re facing. The idea is to get away, unplug, read, write and focus. You’ll be glad you invested the time and energy in yourself.

Finally, friends and family have asked me to publish a list of the content I consumed throughout the week. While this list isn’t comprehensive, it includes a majority of the articles, research reports, podcasts and videos I found most thought provoking or inspiring. Enjoy!

Videos

• Elon Musk Debuts the Tesla Powerwall (YouTube)
• The World’s Scariest Drug (Vice)
• How the Economic Machine Works by Ray Dalio (YouTube)
• Ray Dalio: How to Build a Company Where the Best Ideas Win (TED)
• Chefs Table, Dan Barber and Francis Mallmann (Netflix)
• Brene Brown: The Power of Vulnerability (TED)
• Zeynap Tufekci: We’re Building a Dystopia Just to Make People Click on Ads (TED)

Podcasts

• Life Lessons from a Self-Made Billionaire: My Conversation with Ray Dalio (Farnam Street Podcast)
• Givers, Takers and the Resilient Mind. My Conversation with Adam Grant (Farnam Street Podcast)
• Naval Ravikant on Reading, Happiness, Systems for Decision Making, Habits, Honest and More (Farnam Street Podcast)
• Misbehaving with Richard Thaler (NPR’s Hidden Brain)

Books

• The New Jim Crow: Mass Incarceration in the Age of Colorblindness, Michelle Alexander (Amazon)
• Freedom from the Known, J. Krishnamurthi (Amazon)
• Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor, Seth Klarman (Amazon)

Annual Letters

• Jeff Bezos Annual Letter — 1997 and 2017 (Link)
• Warren Buffett’s Best Investment: The Gates Foundation 2017 Annual Letter (Gates Notes)
• Berkshire Hathaway 2016 Annual Letter (Berkshire Hathaway)

Technology & Innovation

• Google X and the Science of Radical Creativity (The Atlantic)
• The Natural System of Change (Kyle Ballarta on Medium)
• What if Large Tech Companies were Regulated Like Sewage Companies? (The Economist)
• Virtual and Augmented Realities: Asking the Right Questions and Traveling the Path Ahead (Google’s Clay Bavor on Medium)
• Voice User Interface Design: New Solutions to Old Problems (Cheryl Platz of Microsoft on Medium)
• The State of Voice In Five Charts (Digiday)
• 10 Articles that Make Sense of the ‘Voice First Future’ (Luminary Labs)
• The No Stack Startup (Andy Weissman)
• Why No-one Can Prevent Elon Musk from Dwarfing the Airline Industry (J. Charles Gasche on Medium)
• Virtual Meet Reality: AR Will Change The Way We Experience the World (Zac Schildhorn of Lux Capital on Medium)
• Predictions Made by Ray Kurzwiel (Wikipedia)
• Space X’s Big Fucking Rocket — The Full Story (Wait But Why)
• How (and Why) Space X Will Colonize Mars (Wait But Why)

Crypto

• Harvest: Wind Energy Used to Mine Cryptocurrency to Fund Climate Research (Harvest Blog)
• Cryptocurrency Incentives and Corporate Structures (Elad Gil Blog)
• A Letter to Jamie Dimon (Adam Ludwin of Chain)
• Organization in a Decentralized World — How Will Decentralized Platforms Be Managed (Boris Wertz of VersionOne VC)
• The Slow Death of the Firm (Nick Tomaino of The Control)

Artificial Intelligence

• The AI Revolution: The Road to Superintelligence (Wait But Why)
• The AI Revolution: Our Immortality or Extinction (Wait But Why)
• China vs. US: Who is Winning the Big AI Battle (Technode)
• How to Build a Self-Concious Machine (Wired)
• Deep Learning is Going to Teach Us All The Lesson of Our Lives: Jobs are For the Machines (Scott Santens on Medium)
• Cutting Through the Machine Learning Hype (Jason Black of RRE Ventures on Medium)

Venture Capital

• Cross Culture Ventures Leading The Charge On Developing Young VCs (HBCUvc on Medium)
• Capital-as-a-Service: A New Operating System for Early Stage Investing (Ashley Carroll of Social+Capital on Medium)
• Elements of Enduring Companies (Sequoia Capital)
• The Coming VC Storm (John Biggs on Medium)
• Window Shopping (Lindel Eakman of FoundryNext)
• Our Model (Fred Wilson, AVC)

Current Events

• We Snuck into Seattle’s Super Secret White Nationalist Convention (The Stranger)
• Where Internet Orders Mean Real Jobs, and New Life for Communities (The NY Times)
• Undercover with the Alt-Right (The NY Times)

Philosophy

• Happy Ambition: Striving for Success, Avoiding Status Cocaine, and Prioritizing Happiness (Ben Casnocha Blog)
• Dalai Lama: Behind Our Anxiety, The Fear of Being Unneeded (The NY Times)
• Making Major Life Changes (DharmmaWisdom)
• Bruce Lee on Self-Actualization and the Crucial Difference Between Pride and Self-Esteem (Brainpickings)
• David Foster Wallace on Writing, Self-Improvement, and How We Become Who We Are (Brainpickings)
• A Stoic Response to Rejection (The Daily Stoic)
• The Munger Operating System: How to Live a Life That Really Works (Farnam Street Blog)

Food

• This is Your Brain on Gluten (The Atlantic)
• China Signed a $300M Lab-Grown Meat Deal with Israel (Futureism)

The Rise of Cities

• This is What a 21st Century Police State Really Looks Like (Buzzfeed)
• Return of the City State (Aeon)
• The Rebirth of the City State (Corin Faife on Medium)

Social Justice

• The Third Rail: In Baltimore, Public Investment — And Disivnestment — in Transportation Have Figured Greatly in the Persistence of Racial and Economic Inequality (The Place)
• SF Spends a Record $241M on Homeless, Can’t Track Results (SF Chronicle)
• Fostering Profits: An Investigative Look into the For Profit Foster Home Industry (Buzzfeed)
• Black Lives Matter is Democracy in Action (The NY Times)
• The End of Apartheid in South Africa? Not in Economic Terms (The NY Times)
• Why Every Indiana Inmate Could Soon Have a Tablet (USA Today)

Energy

• The Deal with Energy (Wait But Why)
• We’re Going to Need More Lithium (Bloomberg)
• How Tesla Will Change the World (Wait But Why)

Other

• The digital revolution in higher education has already happened. No one noticed. (Clay Shirky on Medium)
• ENFJ — The Protagonist — my Myers Briggs results (16 Personalities)
• This Visualization Shows Why Time Seems to Pass Faster as You Get Older (Vox)
• If You Can’t Find a Spouse Who Supports Your Career, Stay Single (Harvard Business Review)
• What if Your Business Is Actually a Community (David Spinks on Medium)