The Evolution of Foundry
by Seth Levine
When we started Foundry in 2007, our aim was to connect talent with capital, especially in the places and among the people the rest of the technology industry had not yet discovered. We knew that running a nationally focused, early-stage venture fund from Boulder was a trail we had to clear and navigate on our own. But we felt that venture capital had become somewhat stale – almost stagnant – in how funds (and partners) operated. Perhaps it was time for a different approach, new ideas, and new thinking about how to operate a venture fund. We also thought we could have a lot of fun together doing it.
Back then, there were far fewer early-stage venture firms than there are now, and most of the activity in venture capital was concentrated in Silicon Valley or Boston. But we believed that there were advantages to being outside the echo chambers of the coasts. We also felt that many of the accepted ways that venture capital firms operated – from the formats of the ubiquitous Monday Meeting to the way firms sourced and worked on new investment opportunities in silos, to the limited access to resources (and the full partnership) that most portfolio companies had – needed reimagining. Not all limited partners at the time understood our thinking or agreed with us, but we were committed to being innovative and experimental and realizing our vision for a different kind of venture capital firm.
That meant, for starters, that we would support entrepreneurial ecosystems in communities everywhere – we would invest across the U.S. – rather than being a local or regional investor, as most firms were at the time. Significantly, we approached investing in a way that was much more collaborative than others. Gone was the idea that a single partner worked on a new investment opportunity until they decided to bring it to the full partnership for an up or down vote. Instead, we worked collaboratively at all stages of the investment process, providing multiple points of connection for prospective investments; this allowed us to bring different perspectives and skill sets. We aimed to be more fluid than other firms – separating deal sourcing, due diligence, and board work. Often different partners were responsible for each phase of the process and frequently multiple partners worked with a company after we invested. It wasn’t (and still isn’t) unusual for us to shift board seats around from time to time to map best to a company’s needs.
Today, nearly 15 years later, we’re happy to see many of the ideas that we practiced early at Foundry take hold across the industry. Perhaps most important, venture has become much more distributed and has spread to communities not just around the United States but around the world. Boulder itself has a thriving entrepreneurial ecosystem, one we’re proud to have helped to seed. While many venture firms still operate much as they did 15 years ago, many are becoming more fluid and flexible in their thinking and decision-making. We hope we played at least a small role in changing some of these behaviors.
Just as our industry has evolved, we continue to do so, as well. We’ve grown from our four original founders to 15 people, working in multiple locations to support more than 70 portfolio companies. In addition to investing directly in companies, we now invest in other venture funds which we call our “partner funds.” There are 45 partner funds in our portfolio.