The Evolution of Slow Ventures: Insights from Sam Lessin

What is Slow Ventures and How Did It Start?

Who is Sam Lessin and what is the focus of Slow Ventures?

Sam Lessin, co-founder of Slow Ventures, started the firm about eight years ago with a group of friends. Slow Ventures focuses on seed-stage investing, initially pooling money from friends for casual angel investments. After leaving Facebook, Lessin, along with co-GP Kevin Colleran, transformed Slow Ventures into a formal firm, raising $65 million, then $145 million, and deploying about half a billion dollars into early-stage companies. Slow Ventures is known for its generalist approach, investing in a diverse range of industries, from consumer brands like Casper and Allbirds to tech companies like Robinhood, Slack, and Postmates, as well as ventures in the crypto space.

Why is Slow Ventures Called "Slow"?

What is the story behind the name "Slow Ventures"?

The name "Slow Ventures" is both humorous and symbolic. It partly stems from a restaurant called Slow Club in San Francisco that the founders liked. More importantly, it reflects the idea that many "overnight successes" actually start slowly and take time to ramp up. The name also serves as a reminder not to take themselves too seriously, exemplified by one of their core values symbolized by the poo emoji. The firm even joked about naming their growth fund "Slow Growth Fund," maintaining their lighthearted approach.

Why Should Founders Choose Slow Ventures?

What is the pitch for founders to take Slow Ventures' money?

Slow Ventures prides itself on being highly accessible and supportive without micromanaging. They prefer to be available for quick consultations via text, rather than being heavily involved in day-to-day operations. Their strengths lie in offering strategic advice, leveraging their extensive experience with numerous companies. Additionally, Slow Ventures has strong connections with top Series A investors, helping seed-stage companies navigate the critical transition to Series A funding. They maintain regular contact with major investors to understand their metrics and needs, ensuring their portfolio companies are well-prepared for the next funding rounds.

How is the Venture Capital Landscape Evolving?

What are Sam Lessin's views on the current state and future of venture capital?

Lessin recently wrote an essay for The Information, discussing the "end of software VC." He compares the current state of venture capital to previous cycles where industries matured and no longer relied heavily on VC funding. As software models have become well-understood and standardized, they attract capital from a broader range of sources, including large asset managers. This convergence has led to venture capital becoming less about discovering new models and more about providing capital for established ones. Consequently, true venture capitalists are now seeking new, wilder opportunities, often in areas like crypto or entirely new business models, where they can offer unique value and take on more significant risks.

What Sectors is Slow Ventures Exploring?

Which new sectors is Slow Ventures interested in?

Slow Ventures is exploring various sectors beyond traditional software, including crypto, space, and even direct investments in people. Lessin highlighted their interest in decentralized autonomous organizations (DAOs) and other emerging crypto concepts. Additionally, Slow Ventures has started investing in individuals, particularly creators and entrepreneurs, through innovative financial structures. For example, they buy a percentage of a person's future earnings or output, allowing prolific entrepreneurs to bypass traditional seed funding and retain more equity in their ventures.

What is the Concept of Investing in People?

How does Slow Ventures invest directly in individuals?

Slow Ventures has developed two primary structures for investing in people: one for entrepreneurs and another for creators. For entrepreneurs, they create a corporation (C Corp) that the entrepreneur owns and where all their future ventures are channeled. This setup allows the entrepreneur to skip early funding rounds and retain more ownership. For creators, they offer funding in exchange for a percentage of future earnings from various projects. This approach supports creators in monetizing their brand and projects without the constraints of traditional funding models. Slow Ventures has already committed capital to this strategy and is building a dedicated fund around it.

Insights on Starting Complex Ventures

What advice does Sam Lessin have for entrepreneurs starting complex ventures?

Lessin advises against starting highly complex ventures without significant experience and financial security. He and his co-founder, Andrew Kortina, deliberately chose to tackle challenging problems with Finn, a personal assistant service, because they were in a position to take on such risks. They started with a completely manual process, gradually incorporating automation. This approach, known as the Wizard of Oz method, helps entrepreneurs understand the problem space deeply before investing in full-scale automation. Lessin emphasizes knowing one's strengths and preferences, as building service-oriented businesses requires different skills and mindsets compared to software ventures.

The Journey of Finn: From Assistant Service to Knowledge Work Optimization

What is the story behind Finn and its pivot?

Finn began as a personal assistant service combining human and AI capabilities. Lessin and Kortina realized that optimizing knowledge work processes presented a more scalable opportunity. They developed an instrumentation suite to track and improve knowledge work tasks, creating a comprehensive data set to identify inefficiencies and optimize processes. This pivot led to a successful business model focused on instrumenting and improving knowledge work, attracting major clients like Airbnb. Realizing they were better suited for the zero-to-one phase, they brought in a seasoned CEO, Evan Komack, to lead the company through its next growth stages.

FAQs

1. What is Slow Ventures' investment focus?

Slow Ventures focuses on seed-stage investments across a wide range of industries, including consumer brands, technology, and crypto.

2. How does Slow Ventures support its portfolio companies?

Slow Ventures offers strategic advice, maintains strong connections with top Series A investors, and provides quick, on-demand support to founders.

3. What new sectors is Slow Ventures exploring?

Slow Ventures is exploring sectors like crypto, space, and direct investments in individuals (entrepreneurs and creators).

4. How does Slow Ventures invest in people?

They create financial structures where they invest in a percentage of an individual’s future earnings or ventures, providing flexible support for prolific entrepreneurs and creators.

5. What is Finn and how did it pivot?

Finn started as a personal assistant service but pivoted to focus on knowledge work optimization, developing tools to track and improve work processes for large teams.

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