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you're seeing people talk about revenue based financing and I would say that you know that is something that is very exciting as well you you can think about all kinds of new accelerators for areas that are completely untapped
y combinator certainly has a strong brand but you've even seen them rise in the number of positions they've had and then pair it back down
we actually have automated rejections as a first pass so about 50 of our applicant pool gets an automated email response and then of the remaining 50 we do go through it but then we do have you know templated responses basically just very quickly at first glance of the idea is this differentiated
from my time at 500 startups and then also at hustle fun just to share some of our numbers we see about a thousand applications a month so 12 000 across the year and we'll take about a hundred in the year so i think you do want to be sort of under that one percent number obviously just a rule of thumb who knows what the rough quality is of the applications but i think if you're above that then it starts to get a little
it's a bit akin to jason's model as well although he gets wonderful economics with the accelerator and i think that you know we we don't know like everyone else who's going to be the winner when we meet them right there's no data there's no revenue it's two people in a garage so i think if you're going to invest at pre-seed almost by definition unless you want to chuck it up to luck you have to put a lot of bets and so we're investing a small amount of money into a lot of companies that's about
Of course, some companies will end up becoming a thousand X or 10,000 X in the case of Uber or Airbnb or Dropbox.
If you had put 5k into Uber and you had waited until the IPO, supposedly you would get $25 million or thereabouts, which is pretty incredible.
So we decided to start Hustle Fund starting with capital in helping founders at those earliest stages, who had pretty much nothing, get them going in business with a 25K check. So it sounds kind of ridiculous, a VC writing a 25K check, but that's how we started this fund. Fast forward to today, you know, our mission involves helping founders with all three of those things. So we are now just starting Fund 3 with Hustle Fund. We are in process of actually launching a late-stage fund as well to he
I know for sure we have invested in over 400 companies, probably closer to 500 at this point across funds one, two, and three, which were at the beginning of with hustle fund.
When you think about all the things that a great founder needs to be successful, they need capital, they need knowledge, and they need networks. ... And when we were thinking about things at Hustle Fund about six years ago, in particular the capital piece we felt had a real, a real empty spot.
our mission at Hustle Fund, funny enough, a lot of people see us as a VC fund, but I actually see that as my startup. And our mission is to democratize wealth through startups.
we have done introductions for almost all of our companies sometimes as many as even 30 introductions so we do a lot of introductions
we have had a lot of Angels cold email us and you know we have we actually keep an air table list of all of the active ambassadors whether they're VCS are angels so if anyone just in general is listening to this and is interested in particular things shoot me a cold email at Elizabeth at hustle fund VC and yeah you know we would obviously love to you know get some of our startups who are relevant to you like in front of you
we don't have an online demo day and in general I would say we we don't have the bandwidth to actively promote our startups in the public like we as in people often ask us if we have a page of logos and I find that exercise to be constantly challenging for example I did six investments last week so I think constantly keeping an updated page would be hard
yes apply on our website and then you know if you end up getting a call whether it's with me or one of my other business partners and then we make a decision within 48 hours in most cases unless there's something unusual about your situation and so that that's actually pretty fast I would say the slow part is in actually you know we go through every single email that comes through our site and I would say that in general though we you know it's been a bit splotchy but we do try to get back to pe
we have a hundred over a hundred thirty-five companies to date and that that is a lot of companies ... we have a model that's very different from some of the big Sandhill funds ... we will not be on your board we will not be meeting with you regularly ... the way that we've kind of structured things is a couple one is we have a very active and engaged community of smart people ... the second thing is also around we do more scale programming so we do a lot of growth schools around tactical custom
most social media companies we probably wouldn't be able to invest in if it's you know something that you need to monetize with ads like five years down the road and it's not to say that's a bad business it could be actually an incredible business it's just not the right business for a small fund like our so it's more about you know what are certain the monetization you know bumpers around this problem like what are what amount of capital is needed to be able to let's just say you get to profita
for us like historically we have not uh you know funded European companies and the reason actually is not what anyone would think ... at this point in time for Hussle fund we may make a couple of global bets with some pretty you know stringent restrictions around where the incorporation is from just a legal fee standpoint and and kind of learn from those bets because I think that you know depending on the country in the particular area there's a lot that we don't know yet that we need to learn b
you are not looking for in generalist investors you need to be talking to investors who really pretty much only invest in this and understand that and and so for example if it's FinTech like you want to be going all the FinTech investors because these people will actually invest protraction because they all know this as well
I have done three offers like in call like you know right on the spot in my life and we'll see about them but one of them has already yielded a successful exit super excited about that and actually it was such a fast cycle we invested it on hustle fund one and now the founder is an LP and hustle fund to
I think in general we are quite fast I think I've gotten back to almost everybody like from the call stage within 48 hours where there was a yes or no
you're seeing people talk about revenue based financing and I would say that you know that is something that is very exciting as well you you can think about all kinds of new accelerators for areas that are completely untapped
at hustle fund we have a mission as well in fact our mission for hustle fund is that we believe that people who need you know called quote hustlers people who can execute with velocity and really focus ought to be able to get access to resources that could be and and primarily I'm talking about funding
I do think also that in part because of coab it there will be more first meetings done online it's just I'm not sure I am conviction that many and my fellow B C's will be able to write checks without meeting people in person at some point
I do think that just from talking with a lot of my fellow B C's certainly raising funding now is a lot harder in part it's because a lot of B C's are not used to investing over zoom or video conferencing
the number of deals that we're doing in those areas has increased but those are not new areas for us at all
we have also increased both our look and also we've seen an increase in the number of startups going after opportunities that in some sense have benefited from COBIT whether it's you know working remotely or education or healthcare
we're a small fund and we need startups to more or less start making money right away like we're not investing in areas where basically the industry is at least dead for the current being
we want to see something built we do not invest in idea stage companies
we invest in both I would call it US and Canada as one bucket and then also Southeast Asia as a second pocket
we have hustle fund have a lot of companies in our portfolio and so we've actually shared all of our deals with with all of our LPS
we have also gone against the grain and invested in areas that nobody's looking at as well so it's more about the founder spotting an opportunity and then we believe the reasoning of the founder
we've been looking at a fair number of eSports companies but admittedly we have not pulled the trigger yet on on any of those but definitely an area of interest
I think our perspective is that we are pretty vertical agnostic in fact if you look at our portfolio we are kind of everywhere for better for worse and in that sense we are jack-of-all-trades and masters of none and we very much rely on the founders we back to spot trends
I mean certainly b2b whether its SAS or even just you know annual contracts are great because margins are great and also the dollar amounts can be also quite high but we're not tied to that we've invested in many other models whether it's insurance companies paying for digital health or marketplace models or whatever we we definitely have invested in a whole variety of models
for us like as a small fund and we are writing 25k first checks the company more or less has to be able to monetize right away we have to believe that the company can survive and thrive even if they can't raise any more capital so we actually tend to prefer companies who are more bootstrapped in mentality as well as in you know cash management because we very much aligned with that given that our investment checks are so small
we are very much per the size of our fund not looking at ad revenue models right now where you have to get tons of eyeballs to be able to monetize so I would say that you know depending on the specifics of your idea like that that may or may not fall into can you start to get sales pretty quickly
I think having a high-touch and strong rapport with potential customers or would-be customers is great whether it's in person or over the phone or whatnot and and so in those beginning stages what you're really looking for is what is the specific problem than they have are you thinking about a solution that is going after that problem and actually not just is it a problem but like how big of a priority problem is it for them would they drop everything to look for a solution for that
we very much gravitate towards customer acquisition and how how are the margins going to be how easy or hard is it going to be to get customers and so whatever it is you're working on it's less about the underlying technology for us and more about ok what is the solution and the particular problem that you're trying to solve
we don't do physical products or e-commerce because that actually requires a lot of capital so unfortunately we wouldn't be able to get involved in any actual products whether it's actual weed or you know hardware products and sex tech but I think the you know the line is rather blurry or nebulous like we will look at infrastructure software for any of these and you know I think and I also think that there's a judgement call around what is considered by Slyke just from an ethical perspective we
one of the things that we do is actually running out of slots is our bigger problem rather than you know if I could if I could I would just like sort of crowd fund this and ask everyone to chip in 5,000 bucks right and and so what we do is we actually start with a quote small or minimum in the beginning and we say that we're only going to have a certain number of slots be that smaller minimum because we obviously cannot have everybody come in at that smaller minimum if we want to hit a target of