Posts from Union Square Ventures

USV Identity Talent Audition

As we have blogged about, we are working internally to update our web presence. We've hired a part time software engineer who is helping us build something that we hope will better leverage the network that exists inside and outside of our firm, portfolio, and relationships.

As part of that work, we have decided that our identity could use a refresh too. So we've partnered with our portfolio company Behance and are conducting an online talent audition to design our new identity.

Here's how this design competition works:

To participate, simply submit your best brand/identity design work from your portfolio for consideration by our panel of judges (Note: this is NOT a “spec contest,” just submit a past project that best exemplifies your brand/identity work). The top 5 projects will be deemed “winners,” and their owners will be invited to take on USV as a client, proposing a new identity for USV, with a $1,500 guaranteed payment for responding to the brief. If your initial proposal is selected, USV will provide an additional payment of $12,500 for the completed work.

If you are interested, please visit the Behance page and click on the big green "submit your project" button. If you know someone who might be interested, please send them the link and ask them to submit their project for consideration.

My partner Albert, who is on the Behance board, has a longer post on the USV blog explaining why we are doing this and why we partnered with Behance to run this competition.

#VC & Technology

Networks And The Enterprise

Many think that USV is a consumer web investor. We don't think of ourselves that way. We invest in networks and for most of our short history, that has meant investing in networks of individuals connecting with each other. Thus the consumer web investor moniker.

But if you go back over the past four years and analyze the roughly thirty investments we have made in that time period, you will see that a good portion, maybe a third, have been in networks where enterprises participate.

I like to think that our first foray into this kind of network was 10gen, the company behind MongoDB. MongoDB is an open source datastore for web scale applications. The first users were developers who wanted a simple, easy to get started datastore. It was perfect for hackathons and such where the developer needed to get something up quickly. This post I read yesterday does a good job of explaining why MongoDB took off. These developers became a network of users and contributors to the open source project. Many of them worked in enterprises and brought MongoDB into their teams. Soon enough 10gen started getting calls from executives saying something like "I just learned that we have 50 instances of MongoDB in production and I'm eager to get a support contract". That's where the enterprises joined the network.

A year later we invested in Twilio. It's a similar story. Twilio build a dead simple API and cloud service that allowed developers to quickly connect their apps to the world of telephony and SMS. The early users were the same kinds of developers who adopted MongoDB. The classic Twilio story is where the two founders of Groupme built the initial version of their app at the TechCrunch hackathon using Twilio. But again, these developers became a network and the adoption spread into the enterprise.

When an enterprise plugs into a network of developers and tools built in this way they get more than functionality. They get a platform that a lot of engineers know how to use and is becoming a standard in the market. There is tremendous value to the enterprise in these networks over time.

A year later we invested in WorkMarket. WorkMarket built a platform that allows enterprises to take their freelance workforces and put them onto an open shared network. But of course, once a bunch of enterprises do this there becomes a large supply of freelance workers on the platform that can be shared amoung the various enterprises. When an enterprise joins WorkMarket, they don't just get functionality. They get access to skilled workers. Lots of them.

Around the time we invested in WorkMarket, we also invested in Edmodo. Edmodo is a platform that allows teachers and students to connect to each other and communicate, share reading assignments, homework, practice tests, and such. Edmodo currently connects 9.3mm students and teachers worldwide.The Edmodo platform was adopted initially by teachers looking for a better solution to communicate with their students. But like the 10gen story, Edmodo started getting calls from Principals and School Systems looking to deploy the Edmodo platform across their entire enterprise.

One of our favorite kind of networks are marketplaces. And a particularly interesting category of marketplaces are lending marketplaces. We have invested in one called Funding Circle that connects enteprises, mostly small businesses, in the UK with a network of lenders. The more lenders that come into Funding Circle, the more attractive it is to borrowers. And the more high quality lending opportunities that come into Funding Circle, the more attractive it is to lenders. A classic network effect that drives value for small business borrowers.

Our two most recent investments, one of which is unannouced, are networks where enterprises play a big role. The one I can talk about, Behance, is a network of creative professionals, many of whom work in enterprises like agencies. Behance started out as a place where creative professionals could come and showcase their work. But quickly organizations like schools, publications, associations and the like asked Behance to power their networks. These enterprises plugged into the Behance network and created a network of networks.

Sometimes consumer networks can get pulled into the enterprise. A good example of that is Disqus, which started out as a network of bloggers and commenters talking to each other. But a year or so into its life, Disqus started hearing from big media companies who wanted to deploy the Disqus comment system. So slowly but surely Disqus has built a large user base among commercial publishers. And these commericial publishers get way more than functionality when they plug into the Disqus network. They get access to hundreds of millions of monthly viewers and the engagement they create.

We also occaionally invest in data networks in addition to networks of people. I've been involved in one of those for over a decade. It is called Return Path and I invested in it at both Flatiron Partners and Union Square Ventures, the only company that has that distinction. Return Path has constructed a very large data network where all the various participants in the email ecosystem (mailers, intermidiaries, recievers, consumers) contribute data to their system. That data is used to power a bunch of value added products that all go toward making sure the right mail gets to the right person and spam and related bad stuff don't. Every time a new participant in the ecosystem joins the Return Path data network, their systems and tools get smarter, making the service more valuable for everyone. That's a classic network effect and it is very powerful.

This post has gone on longer than I would normally like. And I am certain that I've left out a number of USV portfolio companies that are building networks where the enterprise is a participant. I am sorry if I failed to mention your business in this post.

My uber goal of writing this post is to explain that the wired and mobile internet is a global network and it powers all sorts of smaller networks to get built on top of it. These networks can often include small and large enterprises in them. And we like to invest in networks regardless of whether the enterprise is engaged or not. Increasingly it seems we like to invest in ones where the enterprise is part of the story.

#VC & Technology


Back in 2004, when my partner Brad and I started Union Square Ventures (USV), we decided to make our website a blog. It took us a year to do a final close on our first fund, so when we had finally finished the marketing period for that first fund, we put a blog onto and Brad wrote a Hello World blog post. In that post, he said:

We realized that our thesis evolves incrementally as a result of our dialogue with the market, and that the best way to manage that was to accept that we would never get to an answer, so we should just publish the conversation. The best way to do that is with a blog. So here it is.

That strategy has worked well for us and hopefully for entrepreneurs doing their homework on us. We have published the conversation on for about seven years now as our strategy and role in the startup world has evolved and grown.

But a funny thing happened on the way to the forum. We started having the conversation all over the place. We've been having the conversation here at AVC since 2003, so going into the experiment, we knew that would be an issue. But we also have the conversation at,, unfinished work,,, and on countless tumblrs, twitters, disqussions, and elsewhere around the web.

The footer to Christina's home page says it all:

Christina's page footer

So last week Andy wrote a post on asking the question I asked in the title of this post. In that post Andy said:

our instincts are telling us it may look and feel more like an application or web/mobile service that aggregates content rather than strict content publishing

So Andy went on to say this:

We are therefore looking for someone who can help us build this specific project. Someone who is well versed in web and mobile and design methodologies but who is also a creative thinker. We have some basic ideas of the application we would like to build, but these are not set in stone; we value someone who can not only design and build but also help with the initial brainstorming, ideas, scope and prototyping.

We imagine this opportunity will be of a few months duration. If this sounds like fun to you please tell us a little about yourself in the form below.

Union Square Ventures – Help us build the next version of our internet presence

If you are interested in working with USV to imagine and then help build the future of, please go to that link and let us know.

#VC & Technology


With all the talk of massive amounts of cash sloshing around the web/mobile startup ecosystem (including things I've said recently), you would think that nobody bootstraps anymore. But that is not true at all.

Last week my partner Albert blogged about our most recent investment in Behance. Behance was bootstrapped for its first five years. As Scott Belsky, Behance's founder and CEO, wrote on the Behance blog:

For the past five years, Behance has been a bootstrapped enterprise. We’ve sold Action Pads, books, job postings, conference tickets, and even banner ads (horror!) to generate the income to build Behance. It’s been amazing, and we’ve developed as a team and company in extraordinary ways.

Behance isn't the only recent USV portfolio company to bootstrap its way into our portfolio. Wattpad launched in 2006 and bootstrapped for five years before we invested.

Gabe at DuckDuckGo launched in the fall of 2008, and bootstrapped for three years, working by himself to build DDG, before we invested.

Stack Overflow also launched in the fall of 2008. Joel Spolsky, Jeff Atwood, and the Stack team worked on the project without outside funding for several years before USV invested.

Dwolla launched in the 2010 and operated in bootstrap mode for eighteen months before we invested earlier this year.

Three of the six portfolio companies in our new fund, raised late last year, were bootstrapped for an average of 3 1/2 years before we invested. And at least half of the most recent twenty investments we have made were bootstrapped for well more than a year, and often for a lot longer, before we made our initital investment.

None of this is to suggest that going the accelerator, seed, angel, or some other more fashionable route is a bad idea. They all work just fine. And we are investing in plenty of companies that choose that route. But for some reason our firm is drawn to the bootstrapped model, and increasingly so.

#VC & Technology#Web/Tech

Hacking Society Highlight Reel

Hacking Society is a discussion about how networks are transforming our economy and society, and what this means for the future of innovation, regulation, advocacy and politics.

Two weeks ago, a small group of activists, thinkers, investors and entrepreneurs gathered at Union Square Ventures in NYC to discuss this topic, joined by online listeners & tweeters from around the world.

We are still working on the full transcript, audio recording, and video clips from the event. If you would like to be notified when they are avaialble, click here and leave us your email address. We plan to keep the Hacking Society website live and there is a disqus comment stream there if you'd like to engage in the discussion with us.

In the meantime, here is a Storify "highlight reel" from Hacking Society. It gives a good sense of what was said, who said it, and where this discussion is headed.


Building The Ecosystem

I've always seen the work that my colleauges and I do as more than venture capital investing. That is our main job and we need to do it very well. But we also need to work to make sure the macro environment for our investing activities remains attractive.

There are two primary activities that Union Square Ventures focuses on in addition to our core venture capital activities of backing and then working closely with entrepreneurs and their teams. They are policy advocacy around protecting the freedom to innovate and efforts to build the ecosystem for startups and entrepreneurship. Longtime readers of this blog understand this from the many many blog posts on these two topics.

I'd like to talk a little about building the ecosystem this morning. We view "the ecosystem" both globally and locally. We want to work to build a world where entrepreneurship is available everywhere. But we also want to do everything we can to grow and nurture the entrepreneurial community in New York City. And we believe that the things we support in NYC can and will be copied throughout the world so that our local ecosystem efforts support our global ecosystem efforts.

I've talked at length about many of our local ecosystem efforts and I don't want this post to be a laundry list of the things we are working on. Many of you are quite familiar with them. I would like to talk about a specific thing that two of my colleagues are doing that inspires me.

Last week, Gary and Christina asked me to stop by our event space late one afternoon and spend 45 minutes talking to a group of a dozen or so interaction designers. I talked to them about writing, the importance of taking the time every day to put words down "on paper" and how that forces you to think crisply and clearly. It was a great discussion.

This was part of a three hour class that Gary and Christina teach master students at the School Of Visual Arts (SVA) here in NYC. The class is a requirement for the Interaction Design program and it is called Entrepreneurial Design. Gary blogged about the class here and Christina blogged about it too.

The idea to teach this class came out of Gary's observation that almost all of our portfolio companies are suffering from a dearth of talent in interaction design and that we needed to do something to help produce more talent in this area. Gary and Christina didn't ask for permission to teach this class from anyone in our firm. They just did it. Freedom to innovate in action. I love it.

Things like this make a difference. They add up and build on each other. USV is not alone in this effort. Our colleagues in the startup and venture community in NYC and our colleagues around the world are actively doing things just like this. And the result is a thriving global startup movement that is getting stronger every day.

#VC & Technology

Our Partner Andy

Andy Weissman is a name that is surely familiar to many of you. He co-founded Betaworks, one of the crown jewels of the NYC startup scene. And his writing, his coaching, and his insights have been valuable to so many entrepreneurs in NYC and around the world.

Today Andy is announing his arrival at Union Square Ventures on the USV blog (where else?). Go give it a read and give Andy a big welcome in the comments.

#VC & Technology

Required Reading For The Carlota Perez Interview

I blogged about the interview I'm doing with Carlota Perez tomorrow. I'm super excited about this. The details are in the post behind that link.

We only have 15 minutes so as Carlota and I have talked this over, we've decided that we can't do a deep dive into her research and her theories. Instead we will spend the time trying to make sense of where we've been over the past ten years and where we are heading now.

So, if you plan to attend the interview or watch via livestream, please review these slides in advance. They are from her talk this summer at Stanford at the Triple Helix conference at a session in memory of Chris Freeman, another brilliant economist whose work inspired much of Carlota's work.



#VC & Technology

My Interview With Carlota Perez

There are many people who should get credit for Union Square Ventures' investment strategy.  The community here at AVC is certainly on that list. But possibly at the top of the list is Carlota Perez. Her book, Technological Revolutions and Financial Capital, was responsible for much of the foundational thinking Brad and I did at the start of Union Square Ventures back in 2003, which in turn led to our initial investment thesis.

I am super excited about an interview I am doing with Carlota next week in NYC at the Web 2.0 Expo. Carlota is from Venezuela and lives in the UK and doesn't visit the US very often so this is a pretty special event. The interview will take place next Tuesday, Oct 11th, from 5:05pm to 5:20pm in the plenary session of the event. Web 2.0 Expo is at the Sheraton Hotel and Towers in NYC.

I plan to talk to Carlota about bubbles, golden ages, where we are right now, and plenty more. I've written a fair bit about Carlota and her theories on this blog so if you have any suggestions for questions, please leave them in the comments.

If you'd like to attend in person, you can get a 25% discount on a admissions pass by using the discount code "webny11fos" when you register. You can register here.

The entire event will be livestreamed, including the interview, at in case you want to see it but cannot make it there live.

I'm really looking forward to this.

#VC & Technology

This Week In Startups

A few weeks ago Jason Calacanis stopped by our new offices and recorded an episode of This Week In Startups. It was a fun chat, almost an hour long. My audio is not as good as the audio on Jason so it's a bit hard to hear me unless you want to hear Jason shouting.

If you want to fast forward through the sponsorship message, go to 6:30 and start there.

If you want to fast forward through parts of the discussion, here is the breakdown:

0:00-1:00 Welcome to TWiST from NYC in the Union Square Ventures' offices.
1:00-2:00 Thank you to iStockphoto for sponsoring the show.
2:00-6:30 Demonstration of how easy it is to purchase high-quality photos within iStockphoto.
6:30-8:00 Welcome to Fred Wilson, principal at Union Square Ventures.
8:00-8:30 Jason: The biggest mistake of my career was not listening to [Fred’s] wife when she advised me to go national with Silicon Alley Reporter.
8:30-9:30 How much of being a VC is being a therapist to the entrepreneurs?
9:30-10:30 You’ve worked with Mark Pincus, what was that like?
10:30-11:45 You invested in all four of Mark’s companies, yes?
11:45-14:00 When Mark came to you for the fourth time with Zynga, what did you say?
14:00-15:15 The same sort of situation happened with Twitter, didn’t it?
15:15-16:30 If a VC flies out to see you–the entrepreneur–you know there’s serious intent.
17:45-19:15 So speed is the big difference between web 1.0 and now?
19:15-20:15 Have you ever spoken for your companies too much on your blog?
20:15-20:45 Your blog has really made you into one of the most well-known east coast VCs around today.
20:45-22:30 How much of your success this time around has been because of the blog?
22:30-23:30 Did you enable too much transparency and lose some of your power?
23:30-24:30 If money’s not an issue, why go to a VC?
24:30-25:00 Are there funds that are now following Union Square Ventures?
25:00-26:00 Thank you to MailChimp for sponsoring the show.
26:00-29:30 Demonstration of how you can segment your lists to target your emails using MailChimp.
29:30-30:00 Fred explains why he would like to see entrepreneurs work backwards and think about who they would like to invest in them.
30:00-32:15 How do you reconcile this, the new golden era of Internet companies, with the scars you have from past fund failures?
32:15-33:00 When do founders start thinking, “I should start a new company?”
33:00-35:15 Let’s talk about entrepreneurs. What are you looking to see in the eyes of an entrepreneur?
35:15-37:00 So you’re looking for a persuasiveness that is so strong, people can’t help but follow that person?
37:00-38:15 Do you find that this new generation of founders has an entitlement issue, thinking that they’re owed success?
38:15-39:15 Does that make that person impossible to manage?
39:15-42:15 Are you on the secondary markets? What’s your take on that?
42:15-43:45 Fred: Are Mahalo shares being traded?
43:45-45:30 Are limited partners stoked about the secondary market?
45:30-46:15 Why does a venture firm put money into a single established company and not into several startups?
46:15-48:30 What does an opportunity fund mean?
48:30-49:00 Fred: In the private equity business, you buy one and you’re done. In the venture business, you make multiple investments and the risks are mitigated.
49:00-50:40 What’s your advice for a young entrepreneur who wants your money?
50:40-51:15 Fred, it’s been great to watch you rise over the years. Thank you so much.
51:15-51:45 Thank you again to our sponsors. We appreciate all of your support!

#VC & Technology