Mike Rothenberg’s VC company is young, active and has a lot of cash. Now it all collapsed

After graduating in 2013, Rothenberg opened an office in San Francisco, determined to make Silicon Valley trust him as the head of a new venture capital firm in his 20s: more than just Youthful imitations of mature companies along Sand Hill Road, which is what he perceives as different. In a Harvard Business School case study of his company, he explained this way: “What if you could combine the service modeling approach of Andreessen Horowitz and the online and offline access by First Round Capital’s first community-building founder, with the processing power and reach of Silicon Valley Angels, and Floodgate’s decision and Sequoia’s rulings? No one else can claim that they’re even building those works. That’s what we’re doing. ”

As it turns out, an important component of this paradigm is swagger. That summer, he invited his original employees to the “Crazy Men Day” office. Members of his staff dressed up in the best of the ’60s, and gathered to reenact a photo of the actor on the show, one of Rothenberg’s favorites. In the resulting photo, Rothenberg is no longer an anonymous guy with Mark Zuckerberg.

He has moved to the center of the frame, naturally posing like Don Draper.

In the early days of the company of 2013 and early 2014, employees see Rothenberg as a serious and capable leader. For a while before founding Folsom Street HQ, the team was working in Rothenberg’s new three-bedroom live apartment, which he shared with colleagues. To secure more working capital for a company that was just standing on a relatively small first fund, Rothenberg decided to take an unusual move: he would pay 17.75% of the one-time management fee upfront, instead because the industry standard is two percent annually. fees through a typical 10-year fund. This gave him capital to get started, but not the annual revenue that allowed him to keep his operations running – it took him time to raise money for a new fund each year. I do business. (Management fee has gradually decreased as each fund reached 2% in the fund in 2016.)

Founders appreciate that Rothenberg – the chief (and sole) chief investment officer – loves to act quickly. Kegan Schouwenburg called Rothenberg to invest in her New York-based startup SOLS, a custom shoe insole 3D printer. A 30-minute phone conversation and an hour-long meeting later she had $ 100,000. She said: “Going from the beginning of nothing to something with so much work, and to have someone like ‘I won’t waste your time, I’ll make a decision.’ , she speaks.

By 2014, Rothenberg has been training the company’s capabilities in virtual reality and other emerging areas he calls “pioneering technology”. It is a strategic decision. “Venture capital early-stage is not a good business; the profit is close to zero, ”he said, looking back. “If you are going to beat the market, you have to be different. Have I had more experience than the others? Are not. Do I have more money? Are not. Do I have a bigger network? So I had to choose a different group of companies. That is why I choose pioneering technology ”. The company launched a River accelerator: companies will receive a $ 100,000 investment, Rothenberg Ventures’ 8,000 square foot office space, and the opportunity to gain industry professionals. question, it all culminated in a vibrant demo day.

Earlier that year, Rothenberg also hosted his first Founders Day – renting the AT&T park so that founders and VCs could polish from the home disc while the drone zoomed in on the inner head. a day of speaking and networking, racing through Soma and a private concert that evening at the Fillmore of the Blind Tuesday. It was a bold event, later parodyed by HBO Silicon Valley, to attract attention, network and investments. Rothenberg says he’s never played baseball because he’s too busy with the business. And he emphasized that all the costs that were paid for by the sponsors contributed about 25,000 dollars each, giving or receiving.

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