codingvc.com

Coding VC Startups and startup investing from the perspective of a software engineer turned VC. I'm a software engineer who recently moved into the world of venture capital. As one of the four partners at Susa Ventures, I spend my days meeting and talking with founders, doing technical and non-technical due diligence to decide if specific startups are a good match for Susa, and offering technical advice to companies that we invest in. This blog will cover topics relevant to angel investors (e.g. tips for doing technical due diligence), entrepreneurs (e.g. tips for more effective pitches), and anyone who is interested in how startup investing works (e.g. how seed funds work, what kind of questions get asked during due diligence, general observations about investing, et cetera).

For example, a typical angel might seek to invest $50k in 20 different companies, but each of those companies will be looking for $400k or $800k or some other amount that much higher than $50k. The site frequently features startups that are looking to raise money, and it's a great place to learn about what's new in the startup world. The investor's goals are to understand the startup's mission, the problem that they're trying to solve and how they plan to solve it, who the competitors are, and so on. For example, if a startup is raising $1m at a valuation of $10m, then that means they're claiming to be worth $10m and are selling approximately 10% of the company for $1m.

These might be connections in the press, connections to bigger investors and venture capitalists (when you find yourself needing to raise more money), connections to companies (especially if your startup sells something to other companies instead of to individual consumers), connections to influential people in your domain, and so on. After all, if you own 3% of this $3m company, then wouldn't it be great if the company's value skyrocketed to $500m in a few years? This comes back to value-adds I just mentioned: you introduce the founders to useful connections, you give them advice on how to approach problems they face, you share your experiences with them so that they don't make mistakes, you ask them for progress reports every month or two to help them stay disciplined and on track, and you generally do whatever you can think of to do be helpful. To summarize, what angel investors actually do is talk to tons of startup founders, decide which startups are the most promising, invest in those startups (which often requires competing with other investors), and then do whatever they can to help their investments grow and succeed.

While at LinkedIn, I worked on the first versions of products like LinkedIn Groups and LinkedIn Jobs and also implemented some of the core graph algorithms. After two years at LinkedIn, I spent 3+ years at Google, where I spent most of my tenure working on real-time payment fraud detection. I wrote a large portion of the software infrastructure for that project and also designed and implemented some algorithmically complex fraud signals. While there, I built many components from the ground up including an in-memory distributed search engine; a logging and analytics service; and the bulk of the data cleaning, deduping, and normalization pipeline.