

New Startup Investment Model - mikekarnj
http://www.mikekarnj.com/blog/2009/12/07/new-startup-investment-model/

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cwan
Startups are still far more than just their teams. This is different - the
author seems to be arguing for something broader as if they create a shared
contract technical organization underneath each of the 3+ ventures that may go
in wildly different directions.

A few problems come immediately to mind - people and personality conflicts.
Can you imagine 3 CEO typess competing for resources/timing on various
projects? It might sound ideally initially but conflicts in time and resources
are bound to happen.

The second is trying to convince each startup founder that their idea is
equivalent to the other two and the timing/stage of development is the same. I
doubt it's an impossible idea, but certainly not an easy one to execute. A lot
of (contractual) planning for "worst case scenarios" would be especially
important here.

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trotzke
We've been ironing out this process over the last year. We inject a venture
with need resources up front and then taper them off. That way we don't
continuously struggle with conflicts. Details at <http://sproutbox.com/what>.

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mikekarnj
I like Sproutbox. Seems like a more hands-on Y-Combinator. How has the success
been so far?

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GavinB
The best teams are 2 or more people, including at least one technical founder.
The idea that startups would "would share the resources of the most talented
web developers and designers" doesn't make sense--these people should be
founders.

The USA basketball analogy is apt, because the team failed to perform until
they started to "field complete teams instead of piecing together rosters of
NBA All-Stars at the last minute."
([http://en.wikipedia.org/wiki/United_States_men%27s_national_...](http://en.wikipedia.org/wiki/United_States_men%27s_national_basketball_team))

There's certainly something here--sharing office space, legal resources,
unsuccessful teams folding into more successful ones--but I think the best
success will come with teams whose focus isn't split.

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mikekarnj
Great point on the technical founder. Actually, really good point. Will add it
to our notes.

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mikekarnj
At the very early stages of a business, I think the CEOs should focus 80% of
their time on marketing and growing their business (getting new customers,
building community, etc), and 20% of their time developing the actual product.
The dev team should launch just enough of the website to see if it sticks, and
picks up traction. If it does, it should receive more time and lovin’

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trotzke
This is reminds me of how SproutBox came to be. The 3 founders were all
considering starting their own ventures and decided to pool resources. Things
have evolved a lot since then, but that (and us wanting to also be 'active'
angels ) played a big part in the birth of our investment model.

