Elizabeth Yin 💛
@dunkhippo33
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Co-founder @hustlefundvc. Building a hippocorn company -- market size unknown. Democratizing wealth via entrepreneurship. SF Bay Area native.
Joined May 2008
Personal update: on building a meritocracy in our startup ecosystem - Happy New Year! I am so excited and.
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As a CEO, your 3 roles are: . 1) Ensure your company has enough cash (fundraising + sales) to operate.2) Hire well.3) Keep morale high. That's it.
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Largely true: first time founders start consumer companies. Second time founders start b2b companies.
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I don’t know who needs to hear this but you are not your startup. Whatever happens to your startup will happen. But take care of yourself - you are important.
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Unpopular opinion: we should get rid of all fundraising round names and just use numbers. Eg: “I’m raising $5m”. Vs. “I’m raising a pre-seed, seed, mango seed, post-seed, avocado seed, pre-A, series A depending on who is interpreting.”.
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What the @#*($&# is product market fit? . I've been trying to study PM fit for the last decade. First with my own startup (that never reached PM fit) and then with my < 300 companies I've invested in and the tens of thousands I've reviewed. Here are my thoughts on PM fit:.
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From many conversations:. Young crypto investors don’t want to invest in anything tied to physical things. It caps upside. Older real estate investors don’t want to invest in anything not tied to physical things. It limits downside. A paradigm shift is happening in investing.
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When I was a founder I was completely clueless about fundraising and what investors would ask me. And also why they were asking certain questions. I don't think founders should ever be blindsided by the process. A thread -- read on >>.
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Unpopular opinion: . In most cases, for software startups, it's better to build an audience *first* before building product.
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Today I want to talk about the legal aspects of startups. How to set up? How to think about legal costs?. Fun! . Read on >>.
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10 yrs ago I started my startup. Couldn’t raise $: the economy was sh*t & my co was not venture backable. Craigslist gigs I did to pay bills:. -categorized whiskeys.-critiqued ppl’s resumes.-allowed a Xerox Parc researcher to follow me around. You don’t need investors to start.
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One thing “experienced older entrepreneurs” don’t talk about publicly enough are all the health issues they accumulated from running their startup. Easy to think you can power through the stress and late nights forever but eventually it manifests into something chronic forever.
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Let me tell you about my experience writing $25k-$50k pre-seed investment checks @HustleFundVC. In 99% of cases, I make a decision after just one convo, in 2 working days, & don’t care who else is in. We are often 1st check & set terms w the founder directly on a SAFE. Why? >>.
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Unpopular opinion: you can sell almost anything before actually building it.
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It is wild to me that as a VC fund, we have had to turn down so many $100k & $250k checks from accredited investors who wanted to invest in our Fund 2 to be in compliance w SEC rules. That’s how backwards our system is. The *laws* are designed to keep rich ppl richer.
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I don’t know who needs to hear it:. Success is the best revenge.
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Last yr, I personally paid more in taxes than what I made (!!). I was completely shocked - I didn't think it was possible to *owe more* than you make. But it is. To be clear, this post isn't meant to ask for pity, but I think it can help a lot of ppl out. More >>.
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Most of our investments are still in the US. But the best startup opportunities are outside of the US.
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Hill that I’ll die on: $1k investments are worth taking for the right investor. And more often they are *more helpful* than large check investors. This is why VC is being disrupted. Smaller check writers are proving to be more useful in many cases.
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One thing that has made Silicon Valley successful as a startup ecosystem are all the angels who write $1k checks into startups.
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VCs and fund-of-funds are going to throw tomatoes at me with today's tweet storm: . Ownership *doesn't matter* for early stage investing. And yet almost every VC and fund-of-fund cares about it. 😮. Here's why >>.
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Some trends in VC right now - it's an interesting time of bifurcation and money: . 1) At the early stages (call it pre-A or the whole "seed range"), I'm seeing lots of bifurcation. On one hand, in the Silicon Valley, for some founders, it's never been an easier time to raise.
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Perplexity is a great way to research how to pitch someone. I've run a number of VCs' names in Perplexity and it's pretty accurate on how to pitch them. Here's what it thinks you need to do to pitch me (and it's 90% right). More >>.
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Today I want to talk about how much you should spend to acquire a customer. This is a topic I've thought deeply about for the last 15 yrs. It's such a complex topic, because there are so many unknowns and moving parts. Let's dive in:.
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Yes! I was floored when I learned there are so many friends of mine that angel invest with $1k-$5k here and there. That is probably the real secret to the Silicon Valley - the huge # of microangels. I wish I had learned that in my 20s instead of my 30s.
Start angel investing as soon as you can. Even if $5k a year. By age 30, I had a solid portfolio, which helped me raise a VC fund. (I know this isn’t practical for all. Hope accredited investor rules change. But also-Rule 506b allows for 35 unaccredited sophisticated investors.).
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Researching startup investors is still one of the most time-consuming activities founders end up doing just to raise a round. Here are a few lists of investors I often send entrepreneurs to that can help with this process. (Not in any particular order). Read on >>.
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Everyone is in a war for talent. We’re going to see the rise of the individual working for/on multiple companies and projects.
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It’s hard to hire great marketers for your startup because the best ones make way more money selling their own stuff OR are making a boatload at an already successful co w/out a lot of work. This is why I think founders need to be able to become good mkters even w no background.
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Today's tweet storm is on my learnings on burnout. Burnout is real and can't be ignored. I've faced it a bunch - when I was at Google, during my startup, and even now. Most founders and busy professionals get burned out at some pt (or multiple pts) in their career. Read on >>.
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I saw a pretty fantastic documentary last night called Netflix vs the World (on Amazon Prime). Some interesting tidbits and lessons learned:.
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My business partner @ericbahn was unable to raise VC money. One day he walked into Chase and secured a $250k loan. Was just thinking: no one wrote a Techcrunch article about that. Business was usual. But somehow we celebrate VC raises. Why is that?.
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A lot of angel investors think they need to do a lot of due diligence on a company before investing. But quick reminder: the YC interview is only about 10 minutes & they have one of the best track records. Portfolio construction wins above all else.
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Today’s thread is on “VC backchanneling” — how you can use it to your advantage as a founder. When I was a founder I knew that VCs all talked w/ each other. But boy, they really talk. Here’s how it works >>.
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Something is happening in pre-seed / seed that I think needs to be amplified more. The gap between pre-seed and seed is getting large. More >>.
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Any investor who tells you they will invest once you find a lead or co-lead is not actually committed.
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Today's tweet thread is about the ins and outs of the new @ycombinator deal. What is it? How will it impact founders? How will it impact other investors? . Read on >>.
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I remember so many ups and downs (mostly downs! 🤣) in doing my startup. But the one thing I regret is not taking more photos - even during those downs. Take lots of photos in your startup. You’ll want to have them later.
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Startups are chaotic. But, the goal is to take that chaos and turn them into repeatable processes. One of the biggest stumbling blocks I see founders do is they do too much "random sh*t" for too long instead of turning them into processes. More here >>.
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I recently watched a documentary about one of my favorite investors Warren Buffett. Some interesting takeaways: . 1) Started investing w/ $105k w/ friends and family $$. Took no salary. Earned only profit share from gains over 6%.
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1) I want to talk about investor kindness in the startup ecosystem. Personal story - I pitched an investor for my co yrs ago:. Me: "So what do you think?". Him: "I don't want to say the wrong thing & call you a meek Asian woman, but I question how you'll lead a team of 100 ppl".
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Starting a company is hard. It's like hitting yourself in the face with a glass window and still wanting to sign up for it again over and over.
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It's been about a year since the markets crashed for startups and VC funds. In the past year, it's been incredibly hard for both funds & startups to raise $$. I'm no crystal ball, but here's what is happening from my standpoint & where I think the mkts are going. More >>.
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Since there's been a lot of Twitter chatter about this, here's a thread on. How to Get Started as a Microangel investor in startups?. >>.
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I've looked at 30k+ pitches, and when ppl have asked me in the past which one stood out the most, I've never had a great answer. But today I do. A short thread >>.
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Fundraising is just a scrappy numbers game. We did 700+ mtgs w potential investors to raise our $11.5m fund 1 in 9 months. Our smallest LP in fund 1 wrote a $10k check. Many wrote $25k checks. Progress happens bit by bit not with a lead or big chunks. #hustlewins.
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VC went through no change for ~50 yrs. And now is going through tremendous change in the last 5. 1000s of new fund mgrs, rolling funds, RUVs, SPVs on steroids, crypto, crowdfunding, invention of SAFEs, & more. All historical rules & data get thrown out the window. Buckle up.
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Hello friends - who is interested in seed investing (either angels or vcs) in emerging markets? . I have a few portfolio companies on a FAST trajectory. (And great valuations relative to rev & growth, because most ppl are not interested in investing in emerging markets).
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A startup I want to invest in is a company that can scalably help firms invest into international startups - with tax, audit, and compliance. It is too hard right now. This is why you don’t see institutional US investors investing abroad much.
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Today's tweet storm is about tranching your fundraise -- esp at pre-seed and seed to get momentum on your raise. It's a topic I've lightly touched upon before but here are the tactics and reasons to do this. Read on >>.
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Pet peeve: "We got all our customers for free!". It costs money to: .-write content.-post to social media.-send outbound emails.-take phone calls / talk w/ customers.-do partnerships with referrers. Even if you're doing it. Your time is worth something. Marketing is never free.
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Since I got a lot of qs about $1k investment checks, I want to unpack this in today's thread. Who is writing $1k investment checks? Why? Aren't angels rich? And who is taking these checks? And why? Isn't it a waste of time? . Read on >>.
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A thread on employee equity in early stage startups -- what are the compensation norms? What every early employee should ask? Some thoughts on whether the structure is fair. Read on >>.
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What most ppl don’t understand is that startups are a multi-turn game. To play the game well, you need to be thinking about the game after this one and the one after that.
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Unpopular opinion: email doesn't die because it's basically the only truly decentralized communication platform that exists.
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Today's tweet thread is about how LPs (fund investors) make money (or don't) by investing into funds. When do they send the money to the fund? When do they get money back? What are the fees ppl should be aware of? . thx @zsilvs303 for the topic!. Read on >>.
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A lot of portfolio founders have been asking why so many VCs are sitting out in this market and not investing? . I thought I'd just share a bunch of reasons w/ everyone. Read on >>.
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Today is the first day I’ve felt happy in over a year. I’d forgotten what happiness is like.
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I have been a tech entrepreneur since I was in HS (20+ years). Some learnings: . 1) There is a LOT of luck. Definitely lots of hard work and skill required - no doubt. But, let's not downplay luck. Luck in everything. In privilege. In opportunity. In finding PM fit. In health.
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After many years, I finally got around to creating a doc on How to Raise a Seed Round. This doc organizes my major tweets & blog posts on fundraising in chronological order to how you'll probably need them. You can find it here: Read on >>.
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Saturday thoughts on funding: Where it helps. Where it doesn't. And how it affects team, success, and PM fit. This is just my $0.02 after looking reviewing 30k+ early stage startups personally and having led 350+ investments across 2 VC firms & as an angel. Let's begin! >>.
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From my experience in starting from 2k and going to 75k followers as well as watching others on Twitter, here's a Monday thread on using Twitter as a tool to: . -grow your audience .-find new hires.-find investors.-sell your product. Read on >>.
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Startups are a big mind game. Assuaging your doubts. Ignoring those sabotaging voices. Having confidence in doing things you’ve never done before. Stretching to hit that milestone. But also knowing when to rest. Controlling your mind is the key to winning. And is very hard.
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Today's thread is on cap table 101 for new founders. What is a cap table? Why it's impt? What investors typically ask for? Where founders often go wrong w/ re: to cap tables? . Read on >>.
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The key to a successful startup ecosystem is having a lot of angel-operators who are active in investing both time and money.
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I've been really distracted today because of some disturbing news. I just learned in the news that a founder I previously worked closely w (at my last firm) committed fraud and continued the ruse for over *5 years*. (!). More >>.
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Wow, it’s been a while since I’ve done some tweeting here. I want to candidly talk about what I’ve been up to during the last few wks as a fund mgr. A thread >>.
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When you pitch, you're competing against alternatives. When VCs pitch LPs, it's other VCs.When startups pitch VCs, it's other startups.When startups pitch angels - it's other uses of $$. It's not about whether you are good bet. It's whether you are a better bet than all others.
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Friday thread on email and how I get to Inbox Zero almost everyday. On ave, I receive 200-300 emails per day. Here's how I process mine. >>.
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People have often asked me how I make decisions at pre-seed when there is no information. @HustleFundVC we invest pre-revenue (I don't care about traction at all). A thread >>.
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Pro-tip for newer investors: when you get monthly portfolio updates, always respond. Even if it's just a "Thanks!" or "Good job!" . When I was a founder, it was always nice to receive an acknowledgement that someone was reading, because few investors respond to update emails.
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Some thoughts on early stage valuation:. 1) First and foremost, valuation is not actually about how much your company is worth.
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If you are aspiring to join or start your own VC, the #1 thing you need to demonstrate is how you will source great startups in a repeatable way.
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Ego is what holds most ppl back in startups. The hurt of being turned down by would-be employees, investors, and customers. Maybe it didn’t work out this time. But there’s a high chance it will work out sometime. Don’t let your ego close doors that will take you places.
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When I was an entrep, I never thought about where investors get their $$ from?. Turns out - whether you are a startup or a fund - investors don’t have cash lying around. They also have to raise it or get liquidity on investments. No one volunteers this info so it’s impt to ask.
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We see ~700 startup applications per month and can only invest in a handful. But I know that at least 10-20% will go on to do *phenomenally well*. And that's ~100+ companies PER MONTH!. This is why I still don't think we have enough funders despite what you read in tech news.
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The biggest companies often have just 1 product. And 1 customer acquisition channel *for years*. There is so much to do to scale the 1 thing that is working. Building new products and working on new customer acquisition channels is often a *distraction* from growth & expansion.
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Today, let's talk about lifetime value (LTV). Here's a thread on how to think about it as a business owner. Read on >>.
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A variation on angel investing I would love to see is the ability to give $20 of startup stock to a friend for a birthday. Most of the time, the stock goes nowhere but your friend gets to be part of a cool new co trying to change the world. Sometimes, it could turn into $2000+.
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This AM I received a cold pitch from a company that says they're raising a pre-seed round. They previously raised $11m in their last round. .
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It's amazing that I was able to put a small investment into a startup *on my credit card* and checkout on a website. This is the future.
Excited to announce Gumroad has raised $1M at a $100M valuation from @jasonfried, @kamalravikant, and others. I'm even more excited to announce: you can also invest, at the same terms. As little as $100, no matter where you live or what your net worth is:
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1) Entrepreneurs as well as fund managers often ask me for feedback on their pitch decks. Some quick thoughts on my learnings on this. .
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My kid asked me if there’s such thing as stores that sell books. Like a library but where you can buy them. 🤔.
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Today's tweet thread is about common terms you might see on a term sheet that you may get from a lead investor. What's "standard"? What's no longer common? What should you care about? . Read on >>.
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I turned 40 and had some time to think about learnings over the years. Some career lessons & stories. A thread >>.
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I have backed hundreds of amazing founders over the past few years. Founders who worked themselves out of poverty. Founders who overcame severe diseases and disabilities. But I just did a deal this past week in a founder's company whose story really took the cake:.
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Let's be honest here. The primary driver for VCs slowing (esp those who have new funds w/ fresh powder) is *other VCs slowing*. In a hot market, VCs pick up their speed because other VCs are moving fast and you must move fast to keep up. The spiral effect works both ways.
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This was my kid’s assignment at school. Sometimes I feel like I’m being graded here… 🤔 They might limit my screen time…
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Between years 3-5 is when I typically see founders throw in the towel - either by shutdown or exit. They’re too exhausted from burnout to keep going. But often that’s when you’re just getting the momentum. Take that long vacation. You’re going to need it.
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Being a pre-seed investor, I hear a lot of impressive growth percentages. “We grew 100% each mo for the last 2 months!” (Eg we grew from 1 customer to 2 to 4. ) 😬.
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Today's thread is on valuations, the economy, and where I think things are headed for the rest of the year. Read on >>.
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Recently a portfolio founder told me that he thinks it's best to shut down his company. After talking with him about his thoughts, I *encouraged* him to do so even though it means we will take a loss on our investment. Why? . More >>.
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Which is more important for a startup? Product or distribution? . I think everyone would argue both 🤣 but if you had to pick one, what would you pick and why? . A thread >>.
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Retention, retention, retention. This has probably been my biggest learning as both a founder and an investor. Without strong retention, it doesn't make sense to grow. More >>.
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Fundraising can be so difficult and non-intuitive. So, I'm super excited to announce that we wrote a tactical book to help first-time founders raise money. And it’s 100% free. More >>.
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Today's tweet storm is about how the valuation cap and the discount work on a SAFE. This is a pretty confusing topic, so I think it's worth clarifying. More here >>.
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If you are an early stage company, you should have the mindset to pitch 100+ investors. If you're a new fund, 1000+ investors. Your financing may get done way sooner, but be prepared to do A LOT of mtgs if you truly want to do this. #hustlebaby!.
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