Heroic Sideqik

Back in 2012, I was a sole GP investing from a windowless office in a shared workspace south of Market. With the backing of several remarkable and patient LPs, I had raised $7M of capital and invested in only 25 companies. I was learning a lot in a very hands-on manner.

The portfolio had its moments of high drama, as portfolios usually do. During this time, Sideqik (Bee I) was on the violent swing of the entrepreneurial roller coaster, with a big personnel change at the top. Co-Founders Jeremy Haile and Tree McGlown and I jumped on a call ... It could have been our last. We were brutally honest about the challenges ahead and the near-certain death as a result of an utter lack of capital and a product that just wasn’t working. On that call, I promised to work with them weekly to help right the ship.  Sometimes daily, on those calls and in those meetings, we would discuss the upcoming opportunities, what was being learned every week, what was being accomplished, and what to do next. After every session, Jeremy and Tree would return to the grind and execute with what limited resources they had.

Through those meetings two things happened. One was that a spark began to be lit in these Founders that gave me measured confidence (hope, perhaps?) that these two were the right people to raise this phoenix from its ashes. The second was the conviction that Bee Partners would dedicate and devote time to any founding team that was truly struggling yet definitely had the functionality, the resource magnetism, the empathy, and the passion to execute for brilliance. And, we had LPs who had co-invested as well—we weren’t about to cut bait as would so many other “rational” VCs. We saw that this was not a situation where they weren’t cut out to be Founders, not at all. They just had their backs against the wall and had to make remarkably difficult choices in that phase of their entrepreneurial journey.

Just like a society should be judged by how it supports its most vulnerable members, so should investors be judged by how we support our portfolio companies in their darkest hours.  

This was by no means a quick turnaround and I have long been inspired by how Jeremy and Tree navigated the very squiggly line of entrepreneurship. Every single time they generated some revenue, they would plow it back into the company, and Sideqik became a steady drumbeat of more customers, more employees, more resources. There were always trade-offs—should they hire for marketing or engineering—and real struggles to determine the best uses of capital. But they were making progress, picking up customers like Coca-Cola, Universal Music, and Procter & Gamble.

And then, in 2017/2018, growth rocketed—they had found product-market fit! Their phenomenal patience finally started to pay off and, as of this week, the company is now capitalized with a $5M Series A, led by Jackson Square Ventures.

So, congratulations to Jeremy, Tree, and the entire team at Sideqik, and to JSV for adding these resilient operators into your portfolio—Next step, $100M in revenue!


Neighborly Launches an Opportunity Fund for Open-Access Fiber Infrastructure

Back in 2014, we invested in a crazy Founder named Jase Wilson, who had the audacious vision to connect capital and local communities to drive investment in public infrastructure like schools, parks and more. Our investment thesis: The inefficiencies in the $3.8 trillion municipal securities market can only be solved through software.
   
Since then, Neighborly has closed more than $30M in funding from investors including 8VC, Emerson Collective, and Stanford University. The company won The Bond Buyer "Deal of the Year" award and has grown to a team of 35.

We recently held a call to invite qualified investors to join Neighborly’s Opportunity Fund which would enable local communities to fund their own open-access fiber network infrastructure. Read more about this uniquely powerful effort here, in Jase’s clever and very wise post, You Drive a 1972 Pinto Because Your Neighborhood Makes You.

Machines Will Win: A Portfolio Company Responds

In Q4 2018, the Team Bee joined forces to write an important treatise, a summary of our beliefs and knowledge about the state of technology and humans, and to explain the critical role of our investment thinking in the future that is upon us. 

The resulting manifesto is on our website. Machines Will Win describes a reality from which there is no turning back: The machines of technology are evolving faster than humans. The future we make, the problems we solve, the opportunities we create will derive less from the human ability to harness machines than from trusting the abilities of the machines that people like Bee Partners' Founders will create.

When we first shared Machines Will Win with our portfolio’s Founders, Rachel Taylor and David Rauschenbach, co-Founders of Nubix, wrote a brilliant and concise response explaining how their technology matches Machines Will Win thinking. You can read their thoughts here.

We share their response as one example of the deep philosophical compatibility between Bee Partners and our portfolio that drives investment success. 

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Congratulations, Dustin, Jesse, BuildingConnected - And Autodesk!

Today, it was announced that BuildingConnected, a Bee Partners II portfolio company, has been acquired by Autodesk. This means a Q1 distribution event for our LPs. And, of course, it's a big win for everyone involved, especially Autodesk, which now has access to brilliant Co-Founders Dustin DeVan and Jesse Pedersen and to a market network technology that connects two sides of the unstoppable construction industry. Read more at Forbes.

Autodesk knows that tomorrow’s companies must have data at their core. That’s exactly what BuildingConnected represents within the construction industry. They’re an at-the-edge messaging platform for sub- and general contractors that simultaneously amasses data for actionable insights and revenue opportunities.

When we first met Dustin and Jesse, they represented exactly the dynamic duo we look for in a founding team, with Dustin's problem-Founder fit and Jesse's measured approach to building the solution. Their deep partnership, a myopic focus on the problem, and self-confidence in their potential as a team and an organization have brought them to this moment.

As we do for all our portfolio companies, Bee avidly engaged in making valuable introductions on BuildingConnected's behalf from day one. Looking back through years of correspondence this morning, I see the scores of customers, service providers, and investors we connected them with.

We were a smaller team then. As we've doubled in size and further proceduralized our approach, we know this is the right way to support Founders toward success. We also know we can do at least twice as much on behalf of our portfolio companies as we did for Dustin and Jesse.

Through BuildingConnected, we built relationships across several new investor groups with whom we celebrate today. And our network of bench participants rallied to support, including Founders within the portfolio that offered their time for reference and diligence calls.

A massive thank you to Dustin & Jesse. This morning I listened to a conference call with Dustin from early 2016 (ping us for replay info). With his usual good humor, he recalls his first failures and the long nights that led him to establishing a successful venture. He serves as a guiding light to the 40+ Founders in our existing portfolio and those to come.

See the stories here:

Forbes

Fortune Term Sheet

TechCrunch

Nasdaq

VentureBeat

MarketWatch

StreetInsider

Global Construction Review