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Yesterday, at Startup Grind, an event series that’s aimed at new founders and people contemplating becoming entrepreneurs, we sat down with Joe Kraus, a partner for the last eight years with Google’s early-stage investing arm, GV.
Kraus, who’d earlier cofounded two companies — Excite and Jotspot — shared a range of founder-friendly advice, including what GV and Kraus in particular look for in founding teams (“irrational persistence”), along with some of the missteps that Kraus sees founders make, including “wanting to do everything at once.”
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In fact, Kraus said there are three very specific steps that founders should do and in sequential order if they expect to raise seed, then Series A and Series B funding, beginning with “finding a product that serves a need in a market that matters.”
By “matters,” Kraus really meant “big.”
Kraus - GV - Plenty - Founders - Markets
It may sound like a no-brainer, but Kraus suggested the GV sees plenty of founders who think they can win by dominating smaller markets. The problem, in his view: a mistake in a smaller market often means certain death, “whereas with a big market, you can make a mistake and the market carries you along.”
Kraus also advised focusing a lot less on “top-line growth” and instead on positive unit economics. (Despite the “obsession” of many founders to sell more to more people, often by throwing more product features into the mix, he proposed that VCs right now are far more interested in startups that make more money off the sale of their products.) And Kraus stressed the importance of squeezing returns out of customer acquisition...
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