I joined Genacast in January 2013 as a Partner. Previously, I was a partner at Comcast Ventures where I was one of the first employees in 2000 and remained for nearly 13 years. (I still manage portfolio investments for Comcast Ventures).
I’d like to talk a bit about the birth of Genacast, one in which I was proud to be closely involved with. I first met Gil Beyda in 2007 when he was with Tacoda running their financing process for their Series D. Comcast Ventures was very excited about Tacoda and had considered leading the Series D until I got a phone call one day from Gil that Tacoda was being sold to AOL. That was a big disappointment to us at the time given the amount of time we spent getting to know Gil and team at Tacoda and our excitement about Tacoda’s business prospects. Gil was one of the best entrepreneurs I had met and I made it a point to keep in touch with him throughout rest of 2007 into 2008. After numerous sessions brainstorming on how we could work together, Comcast Ventures partnered with Gil in 2008 to form Genacast, a seed stage investment fund focusing on technology companies in the Northeast. Today, I am proud to call Gil my partner even though we have been working closely together since 2008 as we have collaborated on many deals over the years. This has made this a very smooth transition for me.
Over the past 13 years in venture capital I have noticed a significant shift in early stage financing requirements. When I first joined Comcast Ventures in early 2000s, we would get pitched by early stage companies who needed $5M to hire a dozen engineers and build a prototype for a proof of concept. That was called a Series A and was typically split $2.5M each by two venture capital firms. The proceeds were used to buy servers, rent space in a data center, build layers of the software stack, buy an exchange server for e-mail, etc.
Fast forward to 2013, at Genacast we are getting pitched by entrepreneurs and teams that on little to no capital have already developed a prototype, may have already validated their product with customers and in some cases already have revenue. Instead of seeking $5M, these companies may only be looking for $1M to scale their product or for sales and marketing. These companies are leveraging cloud computing with Amazon, open source software, Google apps, Gmail, etc.
This is an unbelievable shift and change in how companies start and their capital requirements. I believe this is very positive for the entrepreneurs – they can operate more capital efficiently and lower capital requirements generally means less dilution to their founders’ equity. I also believe this is very positive for seed stage investors as with a smaller amount of capital invested we are seeing a significant reduction in the amount of risk of seed stage investing.
I don’t believe the seed stage phenomenon is a bubble or a fad. If anything I think we will continue to see great entrepreneurs start new businesses needing less capital to achieve milestones such as first revenue and shipping their beta product.
I am thrilled to be joining Genacast and working closely with Gil to invest in the next generation of disruptive technology-oriented, capital efficient start-ups.