Tandem Entrepreneurs -- seed investors
tandementrepreneurs.com
tandementrepreneurs.com
1. We're not a VC. We're all entrepreneurs and love building businesses. We put in our sweat first and foremost and happen to invest sufficient capital as well. We only invest our time and money where we can add value.
2. We offer deep business development and technical skills and an extensive network. We work as the extended team so the startup can stay small but still have the right quality and quantity of talent.
3. We love the YC approach of supporting entrepreneurs and drew inspiration from their model. That being said, there are some key differences. Namely, we get actively involved in each business. We invest funds to carry the company for two years to a potential exit or to a high growth trajectory. And, like YC, we leave open the possibility of a small, early acquisition as exit. As we all know, this is a likely outcome these days, even though the VCs don't like them.
4. Because of our involvement we can get involved with founders whose plans are still nascent, and sometimes we'll help put founders together on a business. To us the entrepreneurs are more important than the idea itself.
5. We typically look for technical founders who have a knack for understanding what their users want and then delivering it quickly. We don't encourage outsourcing development unless it's just for commodity components of the overall service.
6. We don't consider anyone a "reject" because a fund passed them by. We'll evaluate each team and business on its own merits and go for it if we like the people, think we can add a lot of value, and believe we can build a valuable business together. Obviously, each group of founders has to decide the same on its side.
7. Tandem is brand new, but we have a lot of experience at building startups. We've made two investments thus far and with three principals only plan to do about 6 per year. In many ways, Tandem is a startup itself in that we're breaking the traditional model, having a blast, taking encouragement and support with open arms, and proceeding full steam ahead regardless of what certain "established" parties in venture finance say.
8. We are happy to entertain folks that have gone through the YC process as well as those that are entering it. In fact, we're attending the YC demo day next week.
Best of luck in building your own startups, and we'd love to hear what you think about Tandem. Feel free to contact us if we can help.
Most entrepreneurs are interested in having the final say. Real control over product development, marketing, etc. Is your attitude that your team is there to help when necessary but otherwise hands off or do you insist on being involved in day to day operation?
Would you mind clarify this a bit more?
We are entrepreneurs, and as such just do what is needed. If we don't believe we can add value to a business, we don't get involved. We insist that the founders control the various aspects of the business, but we also look for opportunities that need our support on a day-to-day basis in the beginning. Once the business has some level of traction, we step back and make ourselves available when and where you need us (including help on large strategic deals or even to sell the business). If you don't need or want our help and are only looking for money, we are not the right fit.
The key elements in execution are - the right thing to do, the right time to do it and the right way to do it. We participate with the founders to help make these decisions on both the technology and business sides. We help where needed on strategy, marketing, bus dev, and tech architecture and provide the infrastructure needed on the administrative side (legal, finance, pr, etc.).
Couple of real life examples. In one of our businesses, certain technical scalability issues were identified and the question was how to solve them and when to solve them. We got involved and were a valuable resource for the founders as we understood the business objectives, development resources and the underlying technology. If need be, we can tune queries and look at code, but most of the time acting a good sounding board is all that's required.
In another case, there was a key question on the initial go-to-market approach for the business. Here, we brought people from other related organizations to the table to help in our decision. We worked with them and the founders to make an informed choice. So far, the results have been very positive...
A friend of mine has dealt with a similar company in Mountain View that shall remain nameless. At first things were going well, then they wanted to outsource the development to India, then they wanted to take 50% of the company. Needless to say he didn't sign with them.
Not all incubators are bad (YC, obviously, isn't), but the bottom line is don't get caught up when numbers with a bunch of zeros on the end get tossed around.
Think hard about their value proposition. If they even mention outsourcing the development, just walk away.
Now that I am over my ego, I have really come to appreciate the fact that I have to give minimal thought to legal, accounting ... etc. It is also really nice to get immediate assistance with strategic, technical and networking (social, not computer) issues.
I would be happy to answer any questions people have about our experience with them. Either here or via email (richcollins@gmail.com).
http://news.ycombinator.com/item?id=40412
the news.yc user "blored" got funding from them. And blored's profile (http://news.ycombinator.com/user?id=blored) suggests that their site is
Edit: oh, you said "AND achieved a liquidity event". Yeah, don't know.
The best thing about Tandem is that they are made up of good people. The venture raising part was very painless, directly a result of Sunil's professionalism.
"Tandem backs existing and potential founders who combine strong technical abilities with a keen understanding of their users and a deep passion and energy for building services for fast-growing business or consumer communities."
What the hell is that?
We can't get any money from the traditional biotech establishment without patents. And we can't get patents until we have some money because most of our patentable ideas will require more expensive lab equipment than we have right now. So for now, we try and make some money by bootstrapping and selling incense, then we get the patents, then we get the real money, then we start the interesting research like curing AIDS which offers a multi-billion dollar payoff.
My company is selling a a genetic test for HIV immunity. With funding, we could expand into other genetic tests very quickly and get FDA approval for as much as we can. FDA approval is not required to sell a "home-brew" genetic test but you can charge a lot more money if you're FDA approved because then insurance will pay for it.It won't take much to dramatically undercut all the existing genetic tests on the market, they're all really overpriced.
For now, I'm enjoying the process of bootstrapping and approaching biotech with the Web 2.0 "make it yourself" ethos.
Seedcamp told me they don't do biotech. Techstars sticks to Web 2.0 function companies. CRV doesn't do biotech. HCP does biotech and has a summer program targeted to college students for it. We didn't get in and they didn't tell us why, though it was still a really nice rejection and they invited us to a barbecue at their office.
YC might fund biotech if they liked you enough but they aren't a good fit for me. The biotech incubator geographically close to me is dumb and I won't give them any control of my company. They're one of those state-subsidized institutions that repeatedly lose money. This is why Pittsburgh sucks for entrepreneurs, because despite the brilliant biotech minds coming out of our universities, there is not nearly enough investment money available.
I should probably email Tandem and ask if they do biotech. Anyone know any seed stage funding firms/incubators that would consider biotech?
Why is this? There are plenty of good Universities in the area - what is Pennsylvania doing to hamper startup companies? Are people just drawn away to other areas like DC?
Now, people who invest generally have money. People who have money generally have a choice of where to live, and are aware of what it's like to live in a real city. Thus, they do not touch Pittsburgh with a ten foot pole.
The weather's pretty bad though. I was surprised to read a few years ago that Pgh was one of the least sunny towns in the country. Then I realized why as a kid I associated sun with being on vacation: when we were on vacation, we were in other places, and everywhere else was sunny by comparison.