What makes Ulu Ventures excited about investing in a startup? Managing Director Clint Korver talks about the essentials founders need before Ulu makes the decision to invest.
Compelling Customer Insight
Of the things that get me excited about a seed stage company, first would be a compelling customer insight. This is not something you’ve read about, but something that you’ve earned through your own experience. So some understanding you have about a customer, a market opportunity that is different than what other people are thinking about or doing.
Big Market Opportunity
Number two would be a big market opportunity. So how is this a compelling customer insight? Is it just for one customer or is it for many customers? We’re looking for something that has scale of many customers.
Plausible Business Model
And then another one would be a plausible business model. So you’re solving a customer’s problem, how do you make money out of that? And that has to be something that we think you can base a company on, so those would be in the “idea camp”.
The Team
The other big thing we look for is the team. On the team side, we’re looking for, as I call it, “super learners”. These are entrepreneurs that have a natural curiosity but in particular, they’re very focused on how do they apply that curiosity to building a scalable business model.
Anti-Fragile Entrepreneurs
Another thing we look for in entrepreneurs is a term from Nicholas Taleb called “anti-fragile”, which is, why is this entrepreneur going to be successful? Even though they run across all kinds of problems, they’re going to get knocked down. Why are they going to keep getting back up again and go after a problem? It can be because they’re super passionate about the problem and they’re just going to walk through walls to make it happen. It can be because they’ve just created a system that can support them. This can be team members, financial support, but it’s like they are just set up to be successful.
Skin in the Game
Other ways that entrepreneurs can be “anti-fragile” is they have skin in the game, it’s like my house is on the line. So this thing has to work, it’s going to work because I’ve just got so much riding on it. In other ways that can be successful is I’ve got a plan B, I’ve got a plan C, I’ve got a plan D. So if this first thing doesn’t work out, I’ve got other things I can go do, other things I can go try. I’m going to have many shots on goal and ultimately one of these is going to be successful.
