I liked Bob Buderi’s interview with Rich Levandov found here . He discusses his early investment in Zynga, however two points stand out to me:
1. The Hunt for the Next New Platform—In Levandov’s view, there have been a couple of really significant platforms in the modern history of IT—namely, the PC and the Internet. “All sorts of companies,” he says, were built around each platform. With the PC they ranged from Lotus to Electronic Arts—not to mention Microsoft, which provided the operating system. With the Internet, Levandov says, “The real jewels that were built on that platform were companies like eBay and Amazon and Salesforce.com.”
Levandov goes on to describe Facebook as a platform to itself (which I agree with) and a core part of his thesis in betting on Zynga.
2. Seed Investing Philosophy—Of seed investing, Levandov says, “It’s important to do it quick.” The old venture model of thinking about a deal for several months just won’t work in this day and age, he says. That’s because “you can form companies quicker, and they build faster—so a lot of times the entrepreneurs need to keep going,” he says. “The process of three to six months of getting through big partnership meetings is just not market appropriate anymore.” Or, put another way, he says, “Due diligence is information you studiously gather if you want to kill a deal—or information you avoid if you want to do a deal.”
He chose avoidance. “When I saw Zynga, from the time I saw Mark to the time I decided to invest, was probably like an hour. You don’t see that level of passion that often.”
Chris: I couldn’t agree more and that is why James and I are very active in making quick decision, small pre-seed/seed investments. It doesn’t mean being undisciplined, but when you come across a great entrepreneur and idea particularly in the internet and mobile space, moving quickly and being helpful makes a world of difference.