500 Startups Announces $30M Canada Fund

Excuse us, but 500 Startups is expanding into Canada in a BIG way! We are launching a $30M regional fund for Canadian based startups.

Canada is huge, and not just in geography; it has many thriving entrepreneurial communities across its 3,000 miles of mostly-populated tundra, as well as some of  the most talented engineers and lowest operating costs of any developed country.

With the creation of 500 Canada (#500CAN), startups across the country will be able to leverage the 500 Startups brand and extensive network of mentors, founders, and partners that come from over 1,500 portfolio companies around the world. 500 Startups has already made 37 Canadian investments out of its Silicon Valley main funds including Breather, Lagoa, Unbounce, Cleanify and more. 500 Canada plans to make 150+ investments into early-stage startups in the region over the next few years.

500 Canada will focus investments on capital-efficient businesses that can achieve profitability with less than $1M in total investment. The fund will be truly national in scope, with partners or associates in each major innovation centre, including Vancouver, Waterloo, Toronto, Montreal, and Fredericton.

Why Canada?

The weather is cold, but the market is hot* with Canada already producing several impressive heavy-hitters like Shopify, Hootsuite, Kik, and Justin Bieber.

Historically, Canada’s largest challenges have been in access to later-stage capital as well as liquidity opportunities, both of which 500 Startups will be assisting with through a global outlook from day one. The Canadian government also provides great support to the entrepreneurial community through an extensive network of grants and tax credits. Coupled with a thriving angel investor ecosystem, Canada’s national sport is rapidly becoming entrepreneurship, as early-stage ventures are scoring more often than the country’s collection of non-playoff-bound hockey teams.

What’s 500 Startups role going to be?

500 will bring Silicon Valley’s best practices to the region through our  massive network, resources and growth marketing programs. Our main focus will be helping these companies internationalize faster and get access to venture capital and mentorship from Silicon Valley.

In June, we are starting with our growth marketing program dubbed “500 Distro Dojo”, which is a 3-month growth intensive program for Pre-Series A companies. This will be followed by additional events and programs for founder and investor education. Follow our updates @500Canada

Get Involved

Are you as excited about Canada as we are?

Then now is your moment to be the gravy in our poutine. Reach out here if you’re interested in getting involved!

About Sanjay Singhal

Sanjay Singhal is the Canadian Venture Partner for 500 Startups. Sanjay has personally started five businesses, and has been an angel investor in over 30 others. Joining the world of early-stage venture capital, he hopes to help other Canadian entrepreneurs achieve their own dreams of success.

Sanjay’s largest entrepreneurial win has been as founder of Simply Audiobooks, aka Audiobooks.com. Sanjay is a founding board member of Angel One, one of Canada’s most prolific Angel investment groups, and also serves on the boards of a number of companies in which he is an investor. Sanjay has Bachelors and Masters degrees in Electrical Engineering from UNB and UBC respectively, and an MBA from Cornell University. Follow Sanjay on Twitter @ssinghal

Canadian artwork by Yiying Lu

* plagiarized from better writing by Sean Percival

Miami’s Startup Ecosystem Only Needs A Little Gas In The Tank

Few of us who live and work in the Bay Area hail from here, but we still have a regional bias; the Bay Area is the best. We enjoy moderate weather, natural beauty and diverse communities that produce culture so rich, we had to coin the word hella.”

Still, entrepreneurs don’t require a Mediterranean climate, Bay views and burritos to thrive; startup ecosystems are budding in Detroit, Syracuse, Denver and elsewhere. In Miami, now home to early-stage investment funds, multiple angel networks and several co-working spaces, the startup scene is closer to blooming.

In 2013, Endeavor, a non-profit that supports high-impact entrepreneurs in emerging markets, opened its Miami office. With $2 million in support from the John S. and James L. Knight Foundation, Endeavor Miami offers entrepreneurs strategic advice, mentoring and opportunities to leverage the group’s network and shared knowledge.

“I don’t like to compare our ecosystem to others,” said Laura Maydón, Managing Director and CEO. “I always describe Miami as a teenager; we’re so young.”

“We are supporting 13 companies led by 20 founders,” she said. “We’re focused on helping entrepreneurs accelerate their growth.” Entrepreneurs have a plethora of reasons for moving to Miami, said Laura, but most cite access to customers, easy travel to Europe, the US and Latin America, the region’s relatively low cost of living and high quality of life.

“I think the companies that are very binary, that are going to either be a billion dollars or zero — are best suited for being in San Francisco, because that’s how they think about investment.”

Trina Spear, co-founder, FIGS

“There’s no state income tax, which is helpful, and there’s just a lower cost for building your company here,” said FIGS co-founder Trina Spear.

Spear’s medical apparel startup is an Endeavor network company that began in Los Angeles a few years ago and opened a Miami office in 2015. “I was born and raised here,” said Trina. “I saw what was going on in Miami with an ecosystem that was being developed and nurtured by amazing entrepreneurs and investors. I wanted to build out our company in a place I was fond of, and also in a place that was more startup-friendly.”

“LA has a great startup ecosystem as well,” Trina noted. “But I love it here, and this ecosystem was developing.” She estimates saving about 50% over LA commercial real estate.

Brian Brackeen, CEO and founder of Kairos, a developer of human analytics software, moved to Miami about five years ago before briefly relocating to Silicon Valley to work for Apple, where he “caught the startup bug along the way.” After Apple, Brian started Kairos in San Francisco and went through the NewME accelerator program before bouncing back to Miami.

FIGS co-founders Trina Spear and Heather Hasson
FIGS co-founders Trina Spear and Heather Hasson

“We looked at five or six different cities: NYC, Philly, Miami, Austin, San Francisco and Boulder,” said Brian, who judged each on criteria like his employee’s COLA costs, personal and business tax implications, the number of angel investors and the population of PHP coders.

“We were searching things like AngelList, GitHub, different state web sites, then we took all that data and Miami was at the very top of the list in every important category,” he said. “Cheapest for our employees, and the best tax situation for the company and our workers. There’s a large number of PHP developers — a ton of talent — which you may be surprised to hear,” said Brian.

“I met Brian when I launched Endeavor,” said Laura, “and one year later, he was part of the Endeavor network. That, to me, is a sign that companies are growing. Companies that mightn’t have been ready two or three years ago are coming into our pipeline, so I see the ecosystem unfolding.”

Florida nabbed just $460.8 million in VC funding in 2015, compared to $862 million the year before. The comedown is due to a 2014 $542 megaround raised by augmented reality changemakers Magic Leap. The bulk of the funding awarded to Miami companies in 2015 went to three health-tech companies: MDLive ($50M), Modernizing Medicine ($38M) and Orthosensor ($22.9M).

“Those investors, 30 to 40% of them will say, ‘hey, we can be more helpful to you if you’re in San Francisco.'”

Brian Brackeen, CEO, Kairos

“I don’t yet know where our strengths play,” said Laura.

“California has one angel investor for every three startups,” said Brian. “Florida has three angel investors for every startup, so there’s a large amount of early stage capital.” Despite the personal wealth, South Florida’s investor class is relatively new to tech, which necessitates ongoing education and outreach, said Laura.

Trina dismissed any notion that founders must live within an Uber ride of their backers. “I think it’s great if you want to meet with investors every day, but it’s very easy to hop on a plane and go have some investor meetings during the time that you’re fundraising,” she said. Ready access to capital can also create a reality distortion field for many founders, Trina added.

“I think that there’s overfunding in some of these markets where you feel like you have to raise more and spend more. I think there’s more discipline around your spending and raising when you’re outside of those cities,” she said.

Even when Silicon Valley likes the cut of your jib, they’ll still try to convince you to relocate, said Brian. “Those investors, thirty to forty percent of them will say, ‘hey, we can be more helpful to you if you’re in San Francisco. You’ve done a great job, really impressive, but if you want to get in the big leagues, you’ve got to come over here and play that game.’”

Kairos founder + CEO Brian Brackeen
Kairos founder + CEO Brian Brackeen

“I’m aware of three startups that did that… moved to San Francisco, and then all the developers they moved with them who were making $80,000 a year were poached, and they completely lost their dev staff,” Brian recalled. “It caused two of the three to fail.” The survivor returned to Miami, he added.

“This location has been nothing but helpful for the company,” he said. “We bought a company last year in Singapore; those people still work there. Other than acquisition, we’ll be hiring here.”

“I think that investors in general tend to be the laggards; once the opportunities are really evident, they will come,” said Laura. “There’s more and more local funding, but entrepreneurs need to supplement their rounds with money from outside.”

“Our team in Miami is really strong and very dedicated to our mission in a way that may or may not be true if we were building this in Silicon Valley or NYC.”

Trina Spear, co-founder, FIGS

Because Miami is so PHP-friendly, Brian’s not challenged when it comes to onboarding new employees. Today, his firm has a 200-person waiting list for new hires. “Forty people on that list are from MIT,” he said.

“One of the reasons why PHP is more common here is because quite often schools are not teaching Ruby,” said Brian. “That’s something at code schools, versus traditional schools which are sometimes a little bit behind. For us, that actually comes out in our favor,” since Kairos is “just going in a completely different direction from a technology perspective.”

In Brian’s view, “it’s hard to hire a technical person in any city in the world. It’s hard in Milan, it’s hard in Akron, Ohio, and it’s very difficult in San Francisco, given the amount of folks who are vying for talent there.”

“I think it’s harder to find really good people in Miami, just because it’s still newer,” said Trina. “When you do find them, they’re way more loyal and harder working because they don’t feel like they have a million options around for getting in at an early stage company and really building something as a team together.”

FIGS’ Miami office is home to the company’s sales and customer service teams, “but our designers are not here, and our engineers are not here,” Trina said. “They work out of our LA office. You’ve got to know where the talent is.”

“I don’t know if I would build out our design and engineering teams in Miami. That being said, other companies have been successful doing that, not that we couldn’t,” said Trina.

“I talked to an entrepreneur today,” Trina added, “and her entire tech team is in SF. I think it works if you have really open communication and break up the team by function in a clean and clear way.”

“Growing and having an ecosystem of high impact entrepreneurs, that will attract talent in itself, because they will have higher needs,” said Laura, noting that Endeavor Miami’s network companies “have several models for talent acquisition: most of them have local teams, but some outsource.”

“There are certain specialties that might be more difficult to find locally, but I think that more and more people are coming to Miami to fill that skill gap,” she added. Wyncode Academy, another Endeavor Miami entrepreneur, does its part by offering coding classes in South Florida to residents who want to “get immersed in the Miami tech ecosystem.”

“I’m a firm believer that human capital is a free resource, so I don’t get too worried about whether you find it here or bring them here,” said Laura. “You want to work with the best talent, no matter where it is.”

“I feel like I’ve made stronger bonds in Miami than I have in any other city.”

Trina Spear, co-founder, FIGS

“The other thing that’s unique about Miami is a cultural difference,” said Brian. “There’s this gold rush mentality: the best and brightest want to chase their dream in tech, and they move to California to do so, which makes perfect sense. It’s a very American, ‘go west, young man’ type of thing.”

“Given Miami’s location and proclivity to be very Latin, the culture is very different,” he told me. Instead of people leaving to seek their fortune. “it’s more like, now you’re old enough to take care of a family,” said Brian. “These cultural differences lead us to have people with Harvard-level skill sets and Stanford-level skill sets who stay in Miami because they have responsibilities. For that reason, we actually retain a much higher percentage of talent than other cities,” he said.

“Silicon Valley is very much about happy hour every night and foosball, and let’s have this amazing culture from a perks standpoint, but in Miami, I think it’s more about where are our goals, and where are we headed and how can we continue to make this work on a holistic level,” observed Trina.

“We don’t need to go to dinner together every night because we have families and we have friends and other outside interests, other than living and breathing the company. But at the same time, we’re all working together for a common goal. It’s not about perks and dinners and working until midnight,” she said. “It’s about loving your job and whatever you’re doing outside of your job.”

“We have fifteen employees and we’re doing a Series A right now. Hopefully, we’ll go to fifty in a year’s time.”

Brian Bracken, CEO, Kairos

“One of the opportunities and challenges we have is to help entrepreneurs stay; depending on the specific vertical they’re in, they might find it easier or more synergy to be based in Silicon Valley,” said Laura. “Some of the entrepreneurs who’ve decided to go there — it’s because of funds, not necessarily because of the markets. I think there’s more striving to be based here.”

“I believe there are all the ingredients in Miami needed to grow the ecosystem , but there’s also a lot of work to do,” Laura said. “This is a long-term game and the ecosystem is putting all its parts together and growing, so hopefully, in a few years, I’ll be able to tell you a progress story.”


photo credit: Phillip Pessar, flickr

Inside the 500 Accelerator Weeks 8, 9 & 10: The Founders Speak

Inside the 500 Accelerator is a weekly series by 500 founder Troy Sultan. Today, 10 weeks in, Troy presents “inspiring” takeaways from other Batch 16 founders. But it’s not all fluffy kittens and cotton candy… being a founder is tough, even with world-class support and mentorship. This week, the founders get real.  

Accelerators are like kitchens, not restaurants. They give you access to all the tools, ingredients and guidance needed to satisfy your hunger — but it’s up to you to mix things up, try new approaches and make use of what’s available. This is contrary to a restaurant where you show up, sit down and expect to have your hunger satisfied.

My team and I recently reflected on the first 10 weeks of 500, asking whether we’re happy with what we’ve gotten from the program so far. Should we make any changes to during the final 6-week stretch? Would we benefit from doing more or less of anything? A recalibration of sorts.

That made us wonder how other teams felt about their experience. Were they getting similar value? Were they struggling in the same ways? Were they being robbed of sleep by the same nightmares and finding motivation in the same dreams?

Accelerators don’t do the work for you — you get out of the experience what you put in, and because of that, every team has a slightly (or largely) different experience.

I sat down with five fellow B16 founding teams to understand how they’re feeling just 6 weeks from Demo Day. Read on to hear what they had to say.

Johnny Warstrom of Mentimeter 

They dig deep into our company but then again they don’t. They don’t care what we do as a product or service. They care about the peripheral: metrics, go-to-market, distribution channels, and they challenge us to try different things rather than getting into the weeds.

On moving a team of 7 from Sweden:

Coming here was a huge risk for us. There were many unknowns and the value we’d get was unclear. What we knew they’d take X%, it’s Y weeks long, and then there’s demo day. But the learning, speakers, mentor office hours, relationships and office banter have completely changed our perspective. We’ve grown a lot.

As for moving our whole team here vs. the just the founders, that was never a question. We‘re only 7 people. At this stage everyone needs a founder mentality. That’s how you create a self-managing company without having to steer in the details. The entire program is geared toward founders, their challenges, and headaches of building a company. We’re all getting that here. The whole team is getting advice as founders and that has tons of long-term value.

On advisors and 500 POCs:

They dig deep into our company but then again they don’t. They don’t care what we do as a product or service. They care about the peripheral: metrics, go-to-market, distribution channels, and they challenge us to try different things rather than getting into the weeds. I was afraid of strong opinions about how to run our business. I hate that kind of advice. They take a very mature and challenging approach to helping companies, which I love.

On expectations and fundraising:

We have 4 angels currently. They’d be happy with 3–5x return on their investment. If we raise more money, expectations skyrocket and we’ll need to deliver much more. We need to decide whether we want to go all in now, or build organically and maintain full say in our outcome. Most companies here are looking to fundraise, but there are also ones challenging that. The goal is to build a great company, which can come in different shapes and sizes. There are many routes to getting there.

Coming from Sweden, you get the impression that founders in the Valley are mindlessly going after investment. I’ve been pleasantly surprised that people seem to be thinking about it in a thoughtful way.

On personal challenges:

My biggest challenge for last year and a half has been knowing when to be firm in knowing what I know and pushing that through vs. when I should be open to have my view point challenged. And that goes for all stakeholders: cofounders, employees, investors, 500 advisors, etc. There’s a fine line between being confident and knowing your shit and being someone who doesn’t know where we’re heading or how we’ll be successful. That’s something I struggle with every day and it’s gets bigger as the company grows and our vision becomes more ambitious.

Justin Howell and Kirk Voltz of Rize

If there’s one thing I worry about for the long run, it’s whether we’re moving too slowly. Speed is probably the biggest thing that keeps me up at night.

On moving fast and avoiding perfection:

We’ve learned to deeply understand things can’t and shouldn’t be perfect. Perfect is the bane of learning.

What moving fast means is getting out there, getting comfortable with the fact that things will suck for a period of time. But that’s how you’ll learn fastest. We’re very good at being thoughtful which is one of our strengths and weaknesses. It makes it easy to move slower than we should.

It’s challenging as a FinTech company where moving fast and breaking things could be a complete company killer. We need to get comfortable living in the grey area. We can’t do everything perfect — we’re not a big company. If we don’t find that line and bump into it, we’re moving too slow.

On managing change:

The set of problems you face at each stage of the company is completely different. They’re equally hard, but different. It never gets easier. It’s one thing to understand this at an intellectual level but another thing entirely to go through it. Everything you thought you knew and you thought you were good at — you don’t, and you’re not.

Your job completely changes every few months. Where you’re spending time now will be miles away from where you’re spending your time in 6 months.

On managing psychology:

There’s more costs to FinTech from a regulatory and security perspective — just more costs to running the business and more time involved, yet you’re held to the same standards as everyone else.

These don’t necessarily keep me up at night but they’re top of mind. I know we’ll keep cranking no matter what and get it done. It’s a question of how long it takes and how hard it is to get to that point.

It’s hard to to avoid thinking about what might make our lives more difficult —  like the fundraising environment. That definitely won’t help things.

If there’s one thing I worry about for the long run, it’s whether we’re moving too slowly. Speed is probably the biggest thing that keeps me up at night. We’ve been at it for a year straight as we approach our beta release next month, and all the work we’ve done thus far was just to get to the starting point.

It’s about stamina. It’s a mental game more than anything else. I’m generally pretty good here, but sometimes I stop and say “Damn, I’m beat.” Then I have to find a way to recharge and get back to it. Sometimes you see a wall coming at you when you’re already tired and you just have to power through it.

Collin Gutman of WorkAmerica

Coming in, we knew there were more ways to tap into our customers — but we didn’t know exactly how, what or why. Now we know which marketing channels work and what to avoid, and how that affects our resource allocation, our growth, pitch, etc. We went from acquiring users 1 way to 4 ways — that’s a mindset shift for the team.

On decision making and leveraging the 500 partners:

Colin Gutman WorkAmerica CEOWe’re making big decisions to try new things which is uncomfortable, but concretely talking through the approach with people who have battle scars and experience that helps us validate. We have our own theories within our team but no way of knowing who’s right. And if no one’s objectively right, we need to know where to start and how to make these decisions. 500 has been hugely valuable as an arbitrator for us.

Coming in, we knew there were more ways to tap into our customers — but we didn’t know exactly how, what or why. Now we know which marketing channels work and what to avoid, and how that affects our resource allocation, our growth, pitch, etc. We went from acquiring users 1 way to 4 ways — that’s a mindset shift for the team. Now we have a pipeline of experiments and a process to run.

That said, I have to be my own sounding board. If you as CEO aren’t 100% committed to the direction you’re heading, the people you work with won’t be either. I spend time at night alone to hash this out so when I come into the office in the morning I’m concrete on the direction.

On what’s keeping him up at night:

What I’m worried about varies widely and changes quickly. We went from a local to national marketplace since joining 500. Before I was worried about going from 2 to 200 schools market by market, and now I’m worried about how to get all 200 at once.

I’m worried about growing revenue MoM. We’ve raised $2M to date, but I still question whether we’re a VC-backable business.

On fundraising:

Fundraising is funny because your ability to get it done may have nothing to do with the business itself. We’ve raised without substantial revenue traction, for example. A million other things go into it.

I’d guess most companies’ #2 goal coming into 500 was growth. I think the #1 goal was to raise money. The perception is that coming to 500 is a very effective way to raise a seed sound. I’m really curious to see how that plays out. How have goals changed? How much does 500 actually increase fundability?

Frank DeGeorge, Nick DeGeorge and Scott Hansbury of YouStake 

The blunt honestly of everyone here is also refreshing. Neither party has time for bullshit, and we love how apparent that is.

On managing time and picking spots:

We knew the time would go fast. At first we took a sponge approach and tried to attend everything but there’s just not enough time for all of us to do that. We had to define roles and ownership areas and develop a cadence.

The program calendar starts to lighten up as time goes by, which works well. We went crazy at the beginning. There was so much info to digest. We figured if we documented it well we can use it later. But we’ve had to pick our spots.

On mentors and POC advice:

It’s surprising how how much they care but yet how little they’re interested in managing the details of your company. Everyone’s accessible but you need to know what you’re looking for and proactively find out who can help you.

It’s really easy for a company to come here and put their head down and not take advantage of everything they have access to. The blunt honestly of everyone here is also refreshing. Neither party has time for bullshit, and we love how apparent that is.

On challenges, pressure and what’s keeping him up at night: 

I’m always thinking about where I’ve failed in the past and making sure don’t repeat those mistakes. How do I keep us on the right path as a business?

There’s definitely a lot of pressure on the fundraise. We didn’t raise a lot of money before this, so in order to grow and utilize what we’ve learned here we have to raise money. But I’m more confident now than ever. I didn’t know our metrics before. If someone asked me CAC or how we’ll get new customers, I could talk to it at a high level but I couldn’t quantify it. Now I can talk to growth, churn, business model, vision, etc. with complete clarity. We’ve been forced to hash that out.

Charlie Mulligan and Samantha August of BrewPublik

Experimentation, smoke testing, and everything else we’ve learned — we’ve never done before. We’ve completely rethought how we’re approaching things. We regularly walk out of a partner meeting and think, “why the hell haven’t we been doing this?”

On challenges of having an east coast operation:

We’ve changed our approach as a company in many ways. We moved from NC to be here and have since opened our west coast market.

We knew it would be hard to manage our east coast operation from here, but it’s been harder than we imagined. It takes a toll on us, emotionally and physically. The day starts at 5am in Charlotte, NC where our other office is. My alarm goes off at 4am every day because it’s too shitty of a feeling to know I’m not in a position to support my employees if I’m asleep.

The camaraderie with people here helps a lot. We’ve built amazing friendships with people going through similar challenges. To know we’re not the only ones helps. We exert a lot of pressure on ourselves to succeed but when we’re struggling to meet growth #’s one week or traction is hit or miss, we don’t feel like our advisors are judging. They just want to help. That’s huge for us.

On progress: 

We pivoted our model 6 weeks in which the partners helped us validate. It’s been much easier to make decision with a sounding board of people who’ve done this before. That’s made a big difference.

Experimentation, smoke testing, and everything else we’ve learned — we’ve never done before. We’ve completely rethought how we’re approaching things. We regularly walk out of a partner meeting and think, “why the hell haven’t we been doing this?”

It was therapeutic to talk 1:1 with fellow founders facing similar challenges and psychological battles.

Overall, everyone had a positive outlook (as every founder should) about their momentum, prospects going into Demo Day, and the progress they’ve made over the last two months. Of course we have our complaints, but who doesn’t? It’s hard not to feel lucky waking up each day and getting to work on what you love. So here’s to all founders keeping that it’s as much about the journey as it is about the destination.

Content and happenings in the last 3 weeks:

  • You’ve Raised Money…Here’s how not to run out of it w/ Mike Sigal
  • Fireside Chat w/ Tiago Paiva, Founder/CEO of TalkDesk
  • Pitch Prep w/ Andrea Barrica
  • Poker night w/ YouStake
  • Mid-batch check-in and AMA w/ Marvin Liao
  • Fireside Chat w/ Jase Wilson, Founder/CEO of Neighborly
  • Startup survival guide on negotiation w/ Jay Mandal
  • More pitch prep w/ Andrea
  • PR Strategy and Data Storytelling w/ Chikodi Chima of Moonshot PR
  • Financial modeling workshop with Doug Scott of Ethic
  • Fireside chat w/ Gary Swart, Ex-CEO of oDesk / GP at Polaris Partners
  • Even more pitch prep w/ Andrea!

Thanks for reading! If you enjoyed, I’d love if you recommended below. You can continue to follow our journey on Medium or Twitter. And if your company can use more recruiting firepower, try spinning up a sourcing team with just a few clicks.

PS — Huge thanks to everyone who contributed their time and opened up about their experience to make this post possible.

Still want more?? Read previous posts:

Or APPLY HERE for Batch 17

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Announcing VC Unlocked: Accelerator edition

Have you ever caught yourself wondering how 500 Startups became one of the top accelerators in the United States in only five years? Well now is your chance to find out!

After running 20 batches of what is basically a bootcamp for companies (and doing a pretty darn good job), 500 startups is now launching a bootcamp for VCs on how to run an accelerator.

The program, Venture Capital Unlocked: Accelerator edition will run May 2nd to 5th in San Francisco. Apply here.

Why 500 is doing this

As anyone paying attention may have noticed, a lot of accelerators have been popping up recently, even in the most unexpected places such as the Department of Homeland Security, the National Association of Realtors, or Venezuela.

While some are doing well, many of them are failing, because running an accelerator is REALLY HARD (trust us).

As part of our greater mission to help develop entrepreneurship and venture capital ecosystems around the world, we want to share both our growing pains and our many successes with others so they can also excel (and hopefully send us some deal flow while they’re at it).


What do I get out of it?

In Venture Capital Unlocked: Accelerator edition, current and aspiring accelerator managers will take a 1 week deep dive into everything it takes to start and run a successful program.

It will be taught by 500 founding partners Christine Tsai and Dave McClure, along with managing partner Bedy Yang and various investment partners involved in running 500’s accelerator (Marvin Liao, Elizabeth Yin, Sean Percival and many others). They will offer an inside look at the 500 Startups accelerator playbook for the first time.

Dave McClure addressing our most recent VC Unlocked group at Preview Day in Mountain View

The instructors will share lessons learned throughout five years of operation and answer key questions such as:

  1. What makes you special?: Position your accelerator to get quality startups in the door
  2. How will you make money?: Explore the most viable revenue models and learn about the relevant legal issues when investing in startups.
  3. How do you choose startups? Practice due diligence and company selection while evaluating real start up applications.
  4. What’s your program? Plan a curriculum and key events to really add value to your companies.
  5. How do you create community and become a valuable link in the chain? Become the most important player in your ecosystem and attract high profile mentors, as well as follow on investments for your companies.

During the program, participants will:

  1. Hear and learn directly from top accelerator founders and managers in Silicon Valley
  2. Receive feedback on their accelerator from fellow participants and 500 Startups investment partners
  3. Put the concepts into practice by screening and evaluating startups
  4. Screen pitches at our invite-only investor events, including our sneak “Preview Day”
  5. Visit the headquarters of a top accelerator in the Valley

How will we do all of this in one week? We’re not sure, exactly.

Join us next month and watch the magic unfold.

How do I apply?

Apply by April 15th, 2016 at 500.vc/accelerator/apply.

We have limited seating so we encourage you to apply early. Successful applicants will be notified on a rolling basis.


exercise dancing vintage retro working out

Program details*:

Tuition fee of 9.6K includes 5 days of densely scheduled talks and interactive workshops led by 500 partners and VIP guest lecturers, tickets to 500 Startups’ investor only Preview Day and Demo Day, one visit to another top local accelerator, breakfast and lunch daily, an opening and closing dinner, and countless SV networking opportunities. NGO discounts available.

See preliminary Program Agenda*.

*Details and agenda are subject to change.


Announcing 500 Startups in LA: All About “DISTRO” (aka Growth Marketing)

500 Startups has already invested in over 65 companies in LA and is noted as one the most active investors in LA-based internet startups according to a recent post from CB Insights.  Our LA portfolio includes consumer and enterprise companies to the likes of Tradesy, Club W, MeUndies, Lettuce, FabFitFun, and StackCommerce.

We see a large market opportunity in LA and we’re expanding our LA presence by launching our Distro Dojo curriculum, which is a 3 month growth intensive program for Pre-Series A companies, on May 2nd.

500 Startups is selecting and investing in up to 10 companies for the LA Distro Dojo and we currently have a few spots left (apply here). Companies should be doing at least $100,000 in revenue per month, and have staff in place to run growth experiments during the program.

Distribution (aka growth marketing) is a major area of focus for 500 Startups; we see it as one of the most important factors in a company’s ability to scale its business sustainably. So important, in fact, that we created an internal distribution (Distro) team three years ago to work closely with our portfolio companies. That team now consists of 15 growth marketers with experience scaling companies including PayPal, Lyft, Hulu, Stripe, Kabam, and others.

In addition to working one-on-one with portfolio companies, including Aircall, Vango, and others, to accelerate growth, the Distro team is always seeking out new ways to add value. Recognizing that the bar continues to rise for startups raising Series A rounds, we developed the Distro Dojo program to help founders and their teams achieve the growth they need to hit their fundraising milestones.

Last year we launched 3 Distro Dojos in Kuala Lumpur, London, and Miami. This year we’re working to launch 10 across the world. The LA Dojo is a 3 month program with 1 month in-residence, as a part of our partnership with WeWork at their Gas Tower location in Downtown Los Angeles.

The program will focus on:

  • Teaching a scientific growth process
  • Creating a marketing experiment pipeline
  • Testing and adding emerging channels
  • Making the right hires for your growth team
  • Talks from 500 Partners and industry experts

We’re looking forward to working with the best and brightest in LA, let us know if that’s you.

Meet the 500 LA Team


Left to right, Andrei Marinescu, Matt Ellsworth, Jess Erickson.

Andrei Marinescu – Partner, 500 Startups

  • Originally from: Bucharest, Romania (via Germany, Indiana, and NYC)
  • In a past life: former scientist, first growth lead at Hulu
  • Favorite Whole Foods location: Arroyo Blvd. in Pasadena
  • Favorite person to follow on Snapchat: DJ Khaled 🔑
  • What I love most about LA: The diversity, the food, and the quality of life

Matt Ellsworth – Partner, 500 Startups

  • Originally from: Iowa
  • In a Past Life: SaaS sales consultant, VP of Growth at Storefront,
  • Favorite Whole Foods Location: Lincoln & Rose, so much yogurt
  • Why LA over SF: Vitamin D

Jess Erickson – Program Director, 500 Startups

  • Originally from Minnesota, moved to Madison, Seoul, London, NYC, Berlin, SF, LA
  • In a Past Life: General Assembly, 6Wunderkinder, Speaklike, LSE
  • Passion Project: building Geekettes, an org uniting & mentoring badass women in tech
  • What I love most about LA: K-town, Venice beach, underground music scene
  • Who’d Play Her in a Movie: Bobby Lee
  • Drops mad tweets at @jessjerickson #500LA

Introducing Specialty Tracks at 500 Startups: Beauty and the B2Beast

Over the past 5 years, we’ve watched 16 batches of startups come through 500 Startups. We’ve seen first-hand how founders benefit from mentorship and advice that’s tailored to the key problems they face in their specific businesses. That’s why this year, we’re launching specialty tracks at 500 Startups.

You can think of joining a specialty track as declaring a major in college. You go deeper into your area of interest, and that gets you to where you want to go faster.


For Batch 17, which starts on May 2 in Mountain View, CA, we’re launching 2 specialty tracks within the batch:

  • B2B: Led by Robert Neivert, this track will focus on the specifics of selling to the enterprise and SMBs and growing revenue. Robert has 2 decades of experience running B2B companies. He’s founded or worked as an executive at 8 companies with 4 exits and 4 still in operation.
  • Beauty and Fashion: Led by Tanya Soman, this track will facilitate the connections to media outlets, brands and retailers necessary to grow distribution and build a big business. Over the last 2 years, Tanya has advised 3 batches of companies at 500, coaching founders on fundraising and pitching in our Mountain View program.

Practically speaking, joining a specialty track means that you’ll get paired with experienced partner-mentors in your market, you’ll sit and collaborate closely with peers in your specialty track, and you’ll attend accelerator events tailored to the specific problems that your category of company has.

At the same time, you’ll benefit from cross-pollination with all the other companies that will be part of Batch 17, which is often one of the biggest sources of creative inspiration. And even though you’re majoring in your specialty track, you won’t miss out on the accelerator’s core curriculum, which includes all of the foundational learnings on how to start a startup.

Why Specialization is a Major Key

If you’re a B2B founder trying to close a multimillion dollar deal with British Petroleum, you’ll want to talk with a partner-mentor who has done it before—not an expert on viral consumer apps.

"There will be roadblocks but we will overcome them.” - DJ Khaled
There will be roadblocks but we will overcome them. —DJ Khaled

Partners have areas of expertise and focus, and that means that we’ve had informal vertical tracks for years, based on which companies work with which partners.

We’ve noticed that making the right matches improves the quality of feedback that companies receive, and that’s inspired us to expand on the idea of accelerator verticals and formalize them.

So with the current batch, Batch 16, we decided to test-drive the idea of specialization by splitting it up into 5 themes:

  • FinTech
  • Digital Health
  • ViceTech
  • HR/workforce development
  • SportsTech

For each theme, we admitted enough startups to ensure that we had a critical mass. In a previous batch, we might have had a single FinTech company. By defining it as a theme for Batch 16, we explicitly set our focus on admitting more FinTech companies, and we ended up with 6 great ones.

Achieving critical mass for each theme meant that every startup in the batch was surrounded by startups grappling with the same issues and searching for solutions to the same problems.

In the past, a solitary FinTech founder might pull her hair out about a particularly thorny regulatory issue and not have anyone to ask for help. A FinTech founder in the current batch could turn to any one of the 5 other companies who’ve fought through the same thing.

During an accelerator, the most important resource that a startup has is time, and splitting the batch into specialties has helped companies do more, make fewer mistakes, and solve larger problems—in less time.

The B2B Track

The best B2B founders are deeply specialized, capable of tackling really difficult problems. They’re the ones most qualified to bring a truly differentiated and original product to market.

To build a great company, however, that specialization has to be combined with expertise everywhere else, from marketing to sales, hiring, and more.

We’ve designed this track with these founders in mind—the ones who, with a little extra help rounding out their skills, have the potential to seriously accelerate their growth.

What You’ll Learn

You’ll learn from top B2B experts about different aspects of building, marketing, or selling a product, with special focus on the areas where first-time founders often have the least experience:

  • Cold calling and emailing
  • How to manage the selling process and deal with gatekeepers
  • Building a predictable revenue engine
  • How to hire a growth team

In addition, each week we’ll hold a roundtable discussion where founders can ask questions and get input from 500’s community of mentors. These mentors will be brought in specifically for their expertise in facets of B2B:

  • We’ll go through issues companies are having with closing large deals, expanding their smaller deals, and ramping up marketing and lead generation.
  • We’ll talk about developing products for larger customers, dealing with customization requests, negotiating deals, and cutting churn.
  • We’ll have presentations on specific B2B strategies, like Matt Ellsworth speaking on how web scraping can give your sales and growth teams a competitive advantage.
Robert Neivert teaching a workshop on delivering memorable pitches
Robert Neivert on how to make your pitch memorable

And the whole time you’re at 500, you’ll be surrounded by fellow B2B founders with whom you’ll share learnings, opportunities, and connections, who will also challenge your notion of what’s possible. When the company across from you grows its revenue 40% in a single month, you’ll know you should be shooting to hit 50%.

Together, you and the founders on the same track will forge deep bonds that will last long after the program ends, while also pushing each other to greater heights.

What We’re Looking for

  1. Metrics and Unit Economics: Customer acquisition cost, lifetime value, churn, retention—all of these metrics are moving targets early in the life of a B2B startup. We’re looking for founders who deeply understand how they work and can talk intelligently about how to improve them.
  2. Traction and Validation: Revenue is important—we like to see about $10k MRR in our B2B accelerator companies—but it’s not a hard-and-fast requirement. Walk in with a couple signed contracts or letters of intent from buyers, and a prototype of your product, and we’ll know you’re solving a real problem.
  3. Distribution: Engineering or product-oriented founders often have the least experience here, and that’s fine if they have the right attitude. We’re looking for those who’ve aggressively hustled to talk to customers and improved based on feedback.

The Beauty and Fashion Track

Worldwide, the combined market value of Beauty and Fashion is well over $1.5 trillion.

Contrary to popular belief, commerce is not dead, and the size of these markets actually proves the inverse: that we’ve only scratched the surface of what’s possible. There’s a massive opportunity out there for companies that can innovate and build a better customer experience, and we’re going to facilitate that.

Where many investors fail to look, we see a bright opportunity—and we’ve already invested in many remarkable startups in the Beauty and Fashion space like Ipsy, Tradesy, Styleseat, Mayvenn, and TheRealReal.

Tanya Soman with Mejuri (Batch 15)
Tanya Soman with Mejuri (Batch 15)

But that’s just the beginning.

That’s why we’re developing a program specific to the challenges these companies face and providing them with the resources and connections they need to grow.

What You’ll Learn

With a critical mass of Beauty and Fashion companies, we’ll be able to create great opportunities for our partners and founders to share their valuable expertise and connections.

  • We’re bringing in successful Beauty and Fashion founders for Fireside Chats to share their experiences.
  • We’re giving each company an in-house growth coach who specializes in selling to these demographics.
  • We’re bringing corporate brands, retailers, and media outlets into the process to connect with our companies.

That last element is crucial when it comes to building a business you can scale.

Companies in Beauty and Fashion need to build relationships early with the traditional arbiters of style—the brands, the magazines, and the stores—but most tech accelerators don’t have these corporations on speed dial, which can make this difficult.

Meanwhile, most of these corporate giants would love to get in on the ground floor of the next big thing, but they don’t know how. There is a disconnect.

What we’re doing is bringing the corporate and startup worlds together, bridging the gap, and laying the foundation that the next wave of businesses within this track can build on.

What We’re Looking for

  1. Revenue. We’re looking for companies that have grown to over $1M annual revenue run rate, but what’s more important is evidence of even bigger revenue growth down the road—solid customer retention and high customer lifetime value.
  2. Product. User growth is great, but it is very possible to get up to millions of active users with a bad product that will ultimately fail. What we want to see is a great, sticky product with relatively low churn, because that traction is what really what proves there’s sustainable growth on the horizon.
  3. Founder-Market Fit. The best founders are often solving problems that they themselves have. We love to see companies grow out of an organic need that founders have, rather than as a formulated play on a market opportunity.

The Future of the Accelerator

In the accelerator landscape today, we see more vertically-specialized accelerators than ever. Even within broad-based accelerators, we see de-facto specialization based on the partner-mentor you get assigned to.

By designing explicit specialty tracks around these unspoken divisions, we’re betting that founders will be able to drive even higher returns out of the community, support and connections that 500 provides.

Apply to Batch 19 & its new specialty tracks here.

4 Realizations From My Day In Prison

Yesterday, I battled torrential rain and excruciating traffic in a 2.5 hour drive up to Vacaville. Needless to say, I wasn’t in the best mood when I finally arrived at my destination — Solano State Prison. However, the grumpiness melted away immediately when I was greeted by one of the guards.

He was the polar opposite of what I would expect from someone guarding the entrance of a prison — cordial, friendly, and mild mannered. With a warm smile on his face, he asked me if the drive was okay, which bridge I took. Then, after directing me to the right parking lot and where to go, he bid me a kind farewell.

Not at all what I expected. It was just one of many surprises in store for the day.

It was my first time in prison. I was there to volunteer with Defy Ventures, along with 500 teammates Tara Graham, Brian Wang, and Aerin Lim. While I didn’t feel particularly scared about going to prison, I had no idea what to expect.

Was Defy really as amazing as I had heard from my colleague Andrea Barrica ?
Would I end up feeling unsafe in any way?
Would we have real impact on the EITs? (Entrepreneurs-In-Training — the inmates participating in the Defy program)

I was blown away by the experience and found myself surprised many times. I’d like to share a few thoughts below.

The irony is that none of these things are legitimate surprises or brand new information. Rather, they all seem like common sense. However, you don’treally get it until you’ve seen it for yourself.

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1. Inmates and Volunteers Aren’t That Different.

In fact, we are shockingly similar. The morning kicked off with a series of ice breakers led by Catherine Hoke (Defy Founder & CEO). One of them was an exercise where a line was taped down in the middle of the room. EITs and volunteers stood on opposite sides of the line. Catherine would then read aloud statements, and people on either side would step to the line if it applied to them.

They ranged from light-hearted (“I like hip-hop”, “I like country music”)….

…to a little more personal (“I graduated from a 4-year college”, “I dropped out of high school”)…

…to really personal (“I lost one of my parents before the age of 18”, “I grew up in a neighborhood where gunshots were heard regularly”, “I’ve committed a violent offense whether or not I was caught”)…

…to introspective (“I feel like I constantly judge myself”, “There are things in life that I haven’t yet forgiven myself for”).

At one point, I teared up because I realized many things about myself, but also because I saw emotion and pain seep into the eyes of both the EITs and my fellow volunteers.

It was particularly moving to see when EITs and volunteers both stepped to the line after a statement was read. Seems that in some cases, volunteers had the fortune of not getting caught and had the support network to keep them from going down the wrong path. Not surprisingly, most of the inmates didn’t.

2. Inmates Aren’t Criminals.

This may be a controversial statement. But yesterday’s visit reminded me that an overwhelming majority of inmates are people who weren’t given the same kind of opportunity as the volunteers. When you grow up in poverty, suffer from abuse, live in a violent neighborhood, come from a broken home, lack positive role models, are told you’ll never amount to anything, etc, the challenges are enormous. It brings a whole new meaning to #firstworldproblems.

In 1:1 conversations with EITs, I was surprised that I felt a little embarrassed of my upbringing. More specifically, I was embarrassed because I felt like I’ve taken it for granted.

For example, one of the statements from the line exercise was “I lost my innocence at the age of [X]”. (Catherine kept ratcheting down the age to see who stayed on the line) One EIT told me he lost his innocence at the age of 5, when he was almost beaten to death by a grandparent. All my “hardships” suddenly paled in comparison. In fact, I had a tough time even answering the question of “I knew I lost my innocence when…” because none of my experiences seemed relevant.

Catherine hates pity. And I hope that’s not how this comes off. Rather, it’s to emphasize another thing she said. Inmates aren’t criminals. Inmates are people who committed crimes. They don’t want to be remembered for the worst thing they ever did in their life.

Granted, crimes aren’t necessarily something to be condoned or downplayed. Many of the inmates were convicted of murder. I’ve lost a relative to murder in an armed robbery. However, when you begin to understand the life circumstances and cards that the inmates were dealt in life, it allows you to be more compassionate and open your mind to the idea that they did a bad thing — but they’re not bad people.

The EITs didn’t want pity, nor did they want handouts. They wanted to be treated like peers and get brutally honest feedback. As the day went on, the EITs seemed less and less like inmates, and more and more like colleagues. There were no barriers separating us. We sat side by side. We shook hands. We laughed and danced together.

Inmates are sons, fathers, brothers, cousins, nephews, and friends. Like any human being, they’re not perfect.

3. Racial Inequality Is REAL.

You don’t need to visit a prison to know that racial inequality exists. There’s enough talk about it, especially in Silicon Valley, to know that there’s a diversity problem.

However, it’s a different story when you visit a prison. When you see what I saw, you’ll know it in your heart.

This too may be a charged topic. But I’ll say my piece. There is something fundamentally wrong when the overwhelming majority of the inmate population is Black and Hispanic. Again, this was something that I was aware of. Most people are. But when I saw it for myself in person (both at the Defy event and when walking on the prison grounds to/from the prison entrance), I was floored.

This isn’t limited to Solano. Almost 60% of the U.S. incarcerated population is comprised of Black and Latino prisoners. The US makes up 5% of the world population, yet holds 25% of the world’s prisoners.

As a society, we’re failing. In so many ways. Such high incarceration rates of underrepresented minorities ultimately means we’re missing out on great potential from Black and Latino communities. Yes, there’s immense talent brewing even within the most impoverished neighborhoods. Talent is universal, but opportunity is not. Never was this more clear than when I interacted with the EITs yesterday.

How do we solve this? Unfortunately the solution(s) is as multi-faceted and complex as the problem. But as my favorite quote goes, An ounce of action is worth a ton of theory. It’s encouraging to see groups like Defy actually DOING something to enact change.

4. Transformation Requires Relentless Optimism & Gratitude.

As I mentioned earlier, the day began with a few ice breakers. For example, giving each other bear hugs, repeating affirmations, performing the Chicken Dance, etc. I’ll admit I thought a few were a little corny. But looking around the room, I was amazed at how engaged the EITs were and how much respect they had for Catherine and Defy. No one was rolling their eyes or slouching in a corner. Even with small exercises, they were present.

They were eager to hear feedback on their personal statements, resumes, mock interviews, and their business proposals, and the ones I coached took the feedback to heart.

But what struck me more than their optimism? Their gratitude.

The EITs expressed so much thanks to the volunteers. I can’t tell you how many of them approached me and shook my hand, thanking me for spending the day with them — even ones I hadn’t interacted with 1:1.

Change is not easy. Defy is not an easy program to complete. But I witnessed a group of men who possessed so much optimism and gratitude that it put me to shame. Many of them already have changed, and Defy is helping them get that second chance in life. Catherine is like no other when it comes to relentless optimism and gratitude.


Volunteering one day with Defy doesn’t make me a saint. I don’t know whether I actually helped anyone in the long run. But I’m hopeful that such small acts (by a lot of individuals) ultimately have a real impact on the lives of these EITs, and in turn begins to address the complex problems that currently exist in our society. Never underestimate small acts of kindness — aka microcompassions.

For me, the entire experience was especially meaningful because I have personal connections to a couple people who are incarcerated. By helping the EITs, I felt that in some roundabout way, I was helping them. And I hope that someday, I’ll see them again on the outside.

Many thanks to the Defy team, the staff at Solano State Prison, and most of all the Defy EITs for having us yesterday.

Catherine Hoke, Founder & CEO of Defy Ventures with Defy EITs channeling tigers.

Special thanks to Andrea Barrica, Mark Saldaña, Tara Graham, Brian Wang,Aerin Lim, and Monique Woodard for reviewing this post.

Introducing Corporate Startup Innovation Unlocked

Corporate Startup Innovation Unlocked

Learn How Big Companies Work Best with Startups

Today we are announcing our first Corporate Startup Innovation Unlocked course in partnership with Pilot44 Innovation Lab; a 4-day executive education program taking place in San Francisco from July 11-14, 2016 with participation from leading corporations including Nestle, Microsoft, and Google.

What is it?

  • In partnership with Pilot44, we’ve created a 4-day intensive course to teach digital innovation leaders how to tap into the startup ecosystem.

Who is it for?

  • Anyone responsible for driving innovation strategy and execution within a complex corporate environment.Participants will walk away with the skills and methodology needed to support an agile, startup-driven approach to innovation within their organization.

What executives will learn from course:

  • How to identify emerging technologies & trends that are redefining consumer & market behaviors
  • How to implement state-of-the-art solutions to address evolving business challenges and opportunities
  • How to partner and work with startups to accelerate tangible innovation outcomes

Who’s involved?

  • Executives from top corporations including Microsoft, Nestle, Google and Cox Automotive will be leading sessions during the 4-day course alongside Investment Partners from 500 Startups and Pilot44.

When is it?

  • July 11th – 14th, 2016

How many spaces are available?

  • 20-30

How much does it cost?

  • Early bird seats start at USD $6,500, Regular seats are $11,500

Where is the course taking place?

  • The 500 Startups office, San Francisco, CA

Corporations are looking to partner with startups to better connect with founders and the startup ecosystem but many have not found a way to accomplish this successfully. We are looking to help bridge this gap.  More information and applications are available at 500corporates.com

Why are we creating this course?

Every week at 500, we field visit requests from corporate delegations wanting to tour Silicon Valley and explore startup innovation.

While many come, only a few walk away with successful partnerships that produce great value. It’s hard to refute the idea of corporates and startups working together; the benefits are obvious. Still, most get it wrong.

We’re here to reduce the number of missed opportunities.

Enter: “Corporate Startup Innovation Unlocked.”

Together with our partners at Pilot44 Digital Innovation Labs, this 4-day intensive course will teach digital innovation leaders how to tap into the startup ecosystem.

Attendees will:

  • Identify emerging technologies & trends that are redefining consumer & market behaviors
  • Discover state-of-the-art solutions to address evolving business challenges and opportunities
  • Learn how to partner and pilot with startups to accelerate tangible innovation outcomes

The course is designed for corporate digital technology drivers looking to innovate in a complex corporate environment. Participants will walk away with the skills and methodology needed to support an agile, startup-driven approach to innovation within their organization.

“While leading P&G’s open innovation effort in Silicon Valley for a number of years, I saw firsthand a huge opportunity for corporations and startups to work together. The opportunity and potential upside is clear, yet few have been successful delivering meaningful outcomes.   We built this course to teach corporate innovators proven approaches and the skills required to capitalize on all that these types of partnerships have to offer”  – Andrew Backs, Founder at Pilot44 Labs

In a recently published 500 Startups report, we found that more than half of the world’s biggest public companies in the Forbes Global 500 are currently engaging with startups. Pilot44 has spent the last 2 years in the trenches with a number of these brands, including P&G, Nestle, Cox Enterprises, and Marks & Spencer; tackling new challenges with a hands-on approach to innovation that drives actionable solutions. It’s not about merely exposing brand managers to the startup space and hoping they walk away inspired. Pilot44 has found that data-driven solutions come from a direct tie to the technology that drives today’s consumers–a relationship that moves from ideation to pilot and execution in a few short months instead of years.

With this course, we want to introduce participants to the Silicon Valley. But more importantly, we want them to walk away with the skills to identify and engage with today’s best startups, and drive actionable results in their own corporations.

“Maybe there are just not enough stories of corporate + startup collaborations in mainstream consciousness. Or perhaps corporations who are doing all the right things simply don’t want you to know about it.” -Khailee Ng, Managing Partner at 500 Startups

Catch the brass ring– join this “hidden” class of innovators, and learn what it takes to lead your company into the future of connected consumerism… the right way.

If you are  a corporation interested in partnering with us  OR  an executive looking to bring innovation and startup connections to your company, connect with us here.


Growth Case Study: StudyPool on Growth for Fundraising & Increasing Revenue by 25% — monthly

Studypool is an online marketplace that has seen 25% month over month revenue growth — 90% of which comes through organic acquisition.

In the 3-month period that they worked with 500 Distro, the company also increased site traffic by 46% and grew customer conversion rate by 18%.

I recently spoke with Studypool cofounder Richard Werbe about growth, fundraising, and the “obvious” things that every founder should know (but often doesn’t).


Give us a summary, Richard. Where are you at, and what did you do with 500 Distro?

We raised 2.3 million dollars, 1.2 of that on the morning of Demo Day and the rest shortly thereafter.

We went that route because it looked like the market was going to be tough so we decided to raise the next million shortly thereafter.

Later, we worked with Andrei Marinescu on the Distro Team as part of a Distro Fund (seed stage) deal, which was a combination of getting a part-time VP of growth plus the investment side.

Andrei is a boss.

He worked with us for over three and a half months, it ended up helping hugely.

As a founder, you miss things. It can be game-changing to work with someone who has seen dozens of companies at your stage and have them spell it out for you.

What’s your One Metric That Matters and your 3-month growth on that metric?

For us, it’s about revenue.

We’ve achieved a consistent 25% month-over-month growth on revenue, mainly from improving tutor quality and engagement, and increasing student acquisition.

What’s the single biggest WIN you’ve seen?

One thing that was really huge for us that came out of our time with Andrei and the Distro Fund turned out to be a very simple change (I know, but really!).

We added an SMS functionality for our tutors. So that means when there are new questions coming in, we now notify our tutors in real time.

It seems obvious but it was one of those things that we hadn’t gotten to yet.

Our tutor activity grew 3X, which means that overall we now have more high quality tutors interested in helping out students. And when that happens it allows us to make a better match for that student which creates a higher quality marketplace.

Aside from that, we also did a lot of work on SEO and organic traffic (which has grown a lot, conversion rate optimization, email marketing, new user activation, analytics, and improving our payments flow.

How do growth and fundraising go together?

When you’re fundraising, it’s important to know — and to be able to communicate — your vision in one or two sentences. You need to be able to succinctly talk about why you’re unique, why what you’re doing is unique, and why it’s working.

Those second two areas are where growth comes in.

Growth is the most essential piece of it because everyone can have a big vision and everyone can be unique. Growth is the proof of why your vision and your “uniqueness” is working. Growth makes the story real.

And it’s not about saying, “We have a $10M on run rate” or some general number like that.

It’s about showing how you got there over time and how you consistently were able to do that month over month.

You don’t want to just do 100% monthly growth for 2 months kind and then flatten out. That’s not actually impressive.

What’s better is to consistently do the same growth month over month for 6 months or nine months; even if it’s not “100% MoM,”  it’s actually much more compelling.

It’s telling investors, this founder and team know what they’re doing. They can control their growth.

That’s something specific that I learn from Andrei, how to build growth as a process not just as one or a few one-off lifts.

Now we’re much more robust now how we approach growth and how we test it.

What does it mean to build “growth as a process”? Is it all about spreadsheets?

The spreadsheet is just basically to document the genius of what’s going on the team.

But basically our process was to come up with a growth hypothesis, and then break it down with these questions:

– What’s the efficiency of this?

– How long will it take us to do this?

– What’s the potential if this succeeds on the test scale? On a larger scale?  

and then you measure that and give it a grade. It’s actually fun.

When ranking the experiments, you could find, for example, something that takes a very little amount of time for our future of our lives.

So that could be a high priority because it’s easy.

And then you might have something that’s extremely hard to make and also may do a lot of good in our lives. In the past, we probably wouldn’t have pushed aside everything for that, made it number 1 on our priority list.

But Andrei made us much more rigorous about ranking things ruthlessly and doing the experiments systematically.

Speed is important.  


Studypool is an online marketplace that connects students with questions with tutors that can answer them.

Getting stuck on difficult problems is at the heart of the learning process, yet a lot of students can get so frustrated that they give up and lose their passion for academic subjects. Studypool aims to address this issue and keep the learning process going.

Studypool was founded by two college students Richard Werbe and Jimmy Zhong in march of 2014.

In classic startup fashion they dropped out of school and headed to California to build Studypool… (Don’t follow their example, kids. Or better yet, maybe DO).

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How We Used Poker to Meet Investors & Do Sales Prospecting

Live events can be a great way to do leadgen. Case in point, our events here at 500 Startups have been very effective in building out our lead pipeline for investors and founders alike (yes we are running a business too).

It seems like a simple formula: throw a good event, meet people, make $$. But there are a few simple additional ways to make sure you actually collect on all those parties.

The following is a guest post from Frank DeGeorge, founder of 500 Accelerator Batch 16 company YouStake, who recently hosted a poker tournament for fun and for profit.

Last week, the first ever YouStake Invitational at 500 Startups HQ in San Francisco brought together founders, staff, mentors, friends and some friendly investors.

YouStake is a marketplace for fans to invest in poker players and share in their winnings. Recently, we held a special event at the 500 office — a championship poker tournament that (not accidentally) ended up netting leads for both fundraising and customer acquisition.

The Poker Event



40 seats were pre sold and 5 more chairs were added to accommodate an additional 5 players.  They all came to play with two of the very best poker players in the world, Jamie Gold (WSOP Main Event Champ) and Anthony Zinno (Card Player, WPT & APA Player of the Year).

Buy-in: $50
Players: 45
Prizes: 1st place, $400 plus private coaching lessons by Jamie Gold, winner of the largest WSOP Main Event Championship prize pool in history at $12 million. 2nd place, $260 plus paid entry to the 2016 WSOP Colossus II $1 million guaranteed first place prize. 3rd place, $140 plus a bottle of ONEHOPE Champagne donated by Batch 16 company Bottles Tonight. 4th to 8th place, YouStake swag bag and hat plus a $50 promo credit to Bottles Tonight.

How to Do Leadgen from Small-Scale Live Events

In this section, we’ll share 3 Simple Steps for how to use small-scale live events plus your existing product and network to get quality leads.

Step 1: Create Demand.

First, you must create something with high demand that a lot of people will want to do.

For us, this was easy; we’re a marketplace for fans to invest in poker players – so of course we focused on a Poker Event.

  • Bring the (poker) stars – Be lucky enough to have the connections, and make sure it’s worth their time. Otherwise, keep costs low and do something that will cover those expenses.

  • Invite the investors – Build a list of target investors, ask for warm intros, and worst case begin to cold email. Don’t worry if not everyone responds, people are busy.

  • Fill in with founders – Get others involved, whether it’s other founders or partners; this will create a buzz and others will want to join.

Step 2: Host a FUN event.

Next, make sure you are prepared and can execute, don’t worry if you make small mistakes because no one will know.

Think about the audience and make sure you accommodate them.

  • Location is key – Find a place with easy access and plenty of space. 500 Startups was gracious enough to let us use their SF office.

  • Timing is key – Not every event needs to be an all-day extravaganza. Sometimes night events work better especially if it’s after work hours and people are available.

  • Don’t forget the alcohol – Or the food, the latter is a mistake we made but we quickly corrected. Bonus points: go out afterwards for drinks and close down the bar.

Step 3: Follow up religiously.

Following up religiously is the last, and probably the most important, step. Make sure you follow up with everyone who showed up, and even those that couldn’t make it.

  • Blog post – An event recap is one easy way to document the results and continue to create that demand; FOMO.

  • New leads – If you did everything right, you created a list of names and emails; for us we funneled every entry through our site (they had to create an account with us to participate in the event).

  • Do it again – Was it a success? If yes, figure out if people would show up again, and as they say, “rinse & repeat”.

For a quick recap about the poker event itself, see our post about it here.