We invest in early stage companies (pre-seed, seed, series A).

Our check size is typically between $100k-$200k depending on the round size. We don't lead and instead look to partner with other investors. Often, we will be one of the first checks in and then work with founders to identify a lead investor and strategic angels.

Our fund is $5M, which is often described as a "microfund" or "angel fund."

Our LPs are primarily executives from companies such as Meta, Google, and Coinbase, successful entrepreneurs, and some fund-of-funds such as Foundation Capital, Bain Capital, and Innovation Endeavors.

We primarily invest in enterprise software companies with a focus on developer platforms, AI/ML, and the modern data stack. Most of our investments are in the US, but historically a significant percentage have also been in the growing startup ecosystems of Israel, Latin America, and Europe. 

No. Since we invest in early stage, there is no requirement to have traction (some companies don't even have a product yet).

TL;DR We invest in strong founding teams with clarity on who/what/why.

Since we invest in early stage startups, the single biggest thing we look for are strong, first-principled founders with a bias for excellent execution. In particular, it's critical that founders have a clear direction and can persuasively communicate so they can attract future employees, customers, partners, and investors. We also evaluate if the business model can be successful and if the type of work it entails plays to the founders' strengths.
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At the earliest stage, the "company" might be just the general outline of the space, the problems, and perhaps a Figma prototype of the solution. We evaluate if this is something that can become a big company based on market size, industry trends, intensity and frequency of current user pain points, and whatever other data points we have.
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In parallel, we evaluate founder-company fit. If we could choose who starts this company, would it be these founders? Are their strengths suited to this space? For example, two incredible sales leaders likely have less of an advantage starting a consumer mobile app company than starting another enterprise sales company where they can leverage their skills and industry contacts. Motivation is also critical and something we actively seek to understand: why are the founders starting a company, and why this one in particular. Read more on the founder's "why." 

Companies are built with conviction rather than consensus, and we believe early-stage investment decisions are similar. We do not require multiple partners to "approve" a decision, and instead we seek to have a single partner have full conviction to invest. To get there, typically, one of us will spend the most time with a company with at least one other partner also meeting the founders. All three of us ask questions, do research, facilitate intros, and in general help ensure the decision is well-informed.
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We aim to invest in areas that we know well, and this typically means we can make a decision within a few business days. If we're evaluating a space we're unfamliar with, the research needed for us to understand and build conviction might take longer.

TL;DR Because it feels good to help others and it makes us better founders and operators ourselves. Also, we enjoy the craft and strategy of investing.

Longer version: just like founders should have a clear “why” for starting a company, we believe investors should have a clear “why” for investing. Here's ours:

(1) Being investors helps us be better founders and operators ourselves. As investors, we are continually learning about the latest technology and getting a front-row seat to how exceptional founders build companies. In addition, evaluating other businesses enables us to practice "zooming out" and seeing the big picture, an important skill that we then apply to our own businesses.

(2) We like the intellectual challenge. Being a good early stage investor is harder than it sounds. You have to source, pick, and win allocation in multiple companies that will provide a 100x return. To make things even trickier, the feedback cycle is long (it takes 5-7 years to start getting meaningful signal on your investment decisions). And even once you start getting feedback on your investment decisions, you have to remain flexible because changes in technology and the macro environment both impact the early stage startup ecosystem.

(3) We genuinely enjoy helping other founders. It is immensely rewarding to use our own experiences to help other founders build in a more successful way.

When evaluating founders, we don't just look at your backgrounds. We use a proprietary competencies framework to analyze your abilities and drivers. As just a few examples, we evaluate your communication and decision-making skills, your ability to hire and fire, and your experience building both product and brand (can be split across cofounders).

When evaluating business ideas and execution, we apply a first principles approach to each company. For example, we don't just look at standard measures of success such as user engagement and revenue; we seek to understand your unique strategy and milestones. As founders ourselves, we know that short-term metrics are not always indicative of long-term success, so instead we look for meaningful product and GTM proof points combined with a clear, execution-ready plan for the future.

‍PRODUCT-MARKET-FIT. Having a product that users love is great, but not when the market is too small. Or perhaps the market is huge but you're not sure which part of it to tackle first. What's your wedge? How do you position your product to potential users/buyers? We can help.

‍IDEATION. Are you in the concept stage and trying to go from rough idea to crystallized startup plan? We've been there, and so have dozens of other startups we've worked with. We're comfortable in the ambiguity of that early stage, and we find it particularly fun too.

‍TEAM BUILDING. We'll help you think through comp bands and leveling, equity pool size, and team structure. On the recruiting side, we'll share best practices on outreach, interview process, and closing. We can also help you evaluate different recruiting solutions. Rapha's company sells to Talent and HR leaders, and Kat has personally used 20+ different tools, agencies, and contractors.

‍FUNDRAISING. If you haven't raised a round yet, we'll help you craft your story and give feedback on your pitch deck. We'll then intro you to the best, most relevant investors for your company. If you already have a lead, we can help you fill out your round with strategic angels. We'll also tell you what we're seeing in the market and advise you on when to do your next round and at what terms.

‍HONEST FEEDBACK. We have a trained eye and we believe in direct communication. We'll tell you what your company's strengths and risks are, and give you actionable recommendations. We'll also share anonymized feedback from other investors and users/customers and help you correct any misperceptions.

‍MORAL SUPPORT. Being a founder is challenging. Even the best startups often hear the word "no" and experience setbacks such as employee turnover and user churn. We get it, and we're always here for you. Text or call anytime.

Email any one of us: kat@darkmode.vc , rapha@darkmode.vc, amir@darkmode.vc