When I started Ascend in 2019, I realized even though I was o-l-d OLD, I had more in common with the folks in town who were earlier in their professional investing journeys than the venerable VC’s I’d pitched as a founder. I admire and respect the new wave of Seattle/Pacific Northwest venture capitalists, and thought it would be fun to profile some of our region’s up and coming VC talents in these pages. —KW
You may not know it, but Ben Gilbert is Seattle’s most famous venture capitalist. His podcast (with David Rosenthal) is the #1 technology show on Apple’s Podcast charts. The startup studio he co-founded is the most prolific in the region. His wit and his voracious appetite for knowledge make him a formidable conversationalist and incredible analyst and investor. And for all of that, he’s always had time for a novice like me, and for founders across Seattle. What’s his story?
What made you decide to be a professional investor?
I'll first answer for Pioneer Square Labs. With our startup studio, PSL Studio, we started 25 companies in the past five years. While we are super excited about the impact we're making in the ecosystem, we recognize that most companies will be started the old fashioned way, and it seemed silly to tell entrepreneurs, "sorry, we can only work with you in this one particular way." PSL Ventures exists so we can work with all great founders in the Pacific Northwest, regardless of how they chose to start their company.
For me personally, I had helped to start several companies from PSL Studio, in addition from the two earliest companies from Madrona Venture Labs (MightyAI and MessageYes, selling to Uber and Nordstrom respectively). I had also bootstrapped several mobile apps over the last decade, some of which had millions of users in the early days of the App Store. I found that my passion over time had become working with entrepreneurs to build their business rather than needing to be the one who had the idea or was running the ship.
What did you do before becoming an investor and how does that benefit your founders?
Quick Resume:
- 4 Years: Indie iOS and web developer
- 1 Year: Microsoft PM, Office for iPad
- 1 Year: Head of the Microsoft Garage
- 2 Years: Madrona Venture Labs (Worked on MightyAI and MessageYes)
- 5 Years, PSL Studio (helped start 25 companies, CEO of one for a year)
- 2 Years, PSL Ventures
- Side projects over the years: Facilitating ~30 Startup Weekends, Building 4 iPhone apps (SeizeTheDay, Zero, RedRide, ThisWeekend), building the Acquired Podcast
See below on benefit to founders.
What are your most successful investments so far?
There are a lot of great PSL companies — some that have gotten more attention than others. Keep an eye out over the next few years! :)
Why should founders want you on their cap table?
For the "me" answer, I am the co-host of Acquired.fm, a podcast that now reaches over 100,000 people a month in the technology and venture ecosystem. That comes with a few things. First, the lessons learned, both from the 150+ businesses we've analyzed, and in building Acquired itself as a business. Second, the relationships with guests and high-profile listeners. Third, the show's reach is an unfair advantage for the founders I get to work with. Of course, I also have the operating experience from helping to start many of the 25 PSL spinouts, stepping into the CEO role for a year of one of our spinouts, and building apps as a bootstrapped developer in my early twenties.
For the "PSL Ventures" answer, we aren't your run-of-the-mill VC. Our team is 25 people, most of which are engineers, designers, digital marketers, and other operational company-builders. We are actively working every day on starting new companies in the PSL Studio. It's a totally unfair superpower for early-stage entrepreneurs to have such a strong "builder" team at their back. Of course, in addition to that, my partners are also wildly talented, having started and sold multi-billion dollar companies, starting other large venture firms, and angel investing in hundreds of companies. When you raise money from PSL Ventures, you have all of us on your cap table.
How many new pitches (actual calls/zooms) do you take per month?
I would guess the number is around 10-15. But really, the goal is to do less meetings and be able to give the highest-density, earliest feedback I possibly can in a process to make the best use of a founder's time. Ideally, if I do a meeting or two with an entrepreneur, it's something I'm excited about intend to purse seriously as an investment for PSL Ventures.
How many new investments do you make per year?
In addition to PSL Studio companies (where PSL Ventures invests in every spinout), we have historically invested in 4-6 external companies per year. It's not a high number. The flip side of this is that we do invest, we're all-in.
What's your sweet spot(s) in terms of check size, valuation, and vertical?
We love to lead, we love to be early, and we love to be a part of building the company. When we invest, we're really invested (both with our dollars and our whole partnership's time). Our check size ranges from $500k to $3m, and we'll look at any company whose primary value proposition is based in technology (though we have a strong bias for software businesses). I in particular like to invest in obsessed founders running pre-launch B2B businesses, or post-launch B2C companies with signs from customers/users that they're really onto something.
What one portfolio company do you want to hype for us here?
Check out Joon Care! Josh Herst, Amy Mezulis, and the team are on an an important mission to treat depression and anxiety in teens and young adults. As many folks know, there is a mental health crisis in our country right now. Joon's product provides a new model for mental health care, combining one-on-one teletherapy sessions with a mobile app-based experience, with support and resources for parents. We had the privilege of co-founding the company in the PSL Studio with Josh and Amy and I'm personally inspired by their dedication to help ease this enormous problem felt by so many.
What do you think the next ten years looks like for Seattle/Pacific Northwest startups?
An increase in every trend we're already seeing — incredible talent not only spinning out of Big Tech™ companies, but also from the mini mafia's we've seen from Convoy, Rover, Zulily… not to mention all the second offices of Bay Area companies. I think the "Cloud City" thing is real and we'll continue to see a boom of great companies involved in internet plumbing. I also think software markets are even bigger than we all thought (which is so widely-believed now, it's a meme), and Seattle companies are great at bringing technology to legacy markets (real estate, lumber, immigration, healthcare, etc.). We're certainly going to keep doing that at PSL.
What song is currently getting the most run on your Spotify/Apple Music?
My top album of 2020 was Taylor Swift's folklore, so there's that.
Favorite shoes?
Nike Free Rn Flyknit 2018 Black/White
Favorite cooking ingredient?
Garlic
Anything else to say?
To founders: keep going. The early part of a compounding graph looks linear — and like a very low-slope linear at that. I'm a big believer that you should be as thrifty as possible in the early days and give an idea the time and breathing room it needs to develop customer love.
As an example, for the first 50 episodes or so of Acquired, growth looked modest and nobody ever talked about us. That didn't really change until 3-4 years in, and all of the slow-burning "goodwill" we had built up among listeners felt like it showed up all at once. Brands and trust take a long time to build.
Lastly, most businesses shouldn't raise venture capital and that is more than okay. If you have the possibility of a nice business on your hands, don't optimize for fundraising milestones… optimize for building the great business! Raise capital if you find yourself in a competitive situation, a winner-take-all-market, or you see a near-term opportunity for hyper-growth. It's harder to build a bootstrapped business early days, but it forces discipline you'll be glad you have no matter which path you choose.