Apr 16, 2008

betaworks, vc

Paul Graham:

The exciting thing about market economies is that stupidity equals opportunity. And so it is in this case. There is a huge, unexploited opportunity in startup investing. Y Combinator funds startups at the very beginning. VCs will fund them once they're already starting to succeed. But between the two there is a substantial gap.

John Borthwick, re betaworks:
Mid 2007 we flipped our approach — and went bottoms up. We stayed small, under the radar, focussed on our theme, seeking not to be distracted by opportunism. We started identifying standards and methodologies to scale our work and stopped trying to over think the design. By the fall of 2007 we had assembled our learning and formally started to build out the platform. Six months later we have four things that we have built and we have fourteen seed investments. . . .

Someone said to me last week that we are a reverse incubator. Incubators share the peripheral services things that I believe entrepreneurs can and should get from the market (legal, hr, accounting, office space) — betaworks is designed to share core capabilities - software / IP, knowledge, data, standards, analytics, leadership, tools etc… Someone a year ago called it a funcubator — maybe outcubator? — a little less George Clintoneque.

Scott Rafer:
VCs are money managers rather that bold desperados? must be a very slow news day.


Anonymous said...

Hi Andrew,
not sure if you've heard of OutCubator from a friend, or from the web. Basically, we do exactly what you describe. Instead of providing a common office space, HR, marketing, PR functions, we provide a common development team and common values for product development excellence. We help entrepreneurs who have seed funding and great ideas to execute on their ideas, and we help the stretch the seed funding with our capabilities. And we work with several companies at one time, so we manage a portfolio in some way. And we hope that each one of these companies one day become successful so that our shares in them grow as they grow. That's what OutCubator is. Would be interesting to find out about betaworks as well.