Fred Wilson Tells The Secret To Landing His Investment

LE WEB PARIS 2013 - CONFERENCES - PLENARY 1 - FRED WILSON

When you’re talking about top tier venture capital firms, you can’t really leave out Union Square Ventures. The New York firm has invested in some pretty big names: Twitter,  Foursquare, Etsy, Kickstarter…

Actually, that list could continue for the rest of this article, and I still wouldn’t name all the strong companies USV has invested in. Yet, despite a long list of impressive investments, the firm only hands out money to roughly 8-10 companies a year.

So, how does a startup get the attention of a top tier VC firm like Union Square?

Thanks to blogging, speaking investors like USV’s Managing Partner Fred Wilson, that’s actually not hard to discover anymore. But, last week, Wilson gave a talk at Le Web that outlined their investment strategy.

Ok, so he was supposed to talk about his predictions for the future.

“As if I had a crystal ball or something,” he told the audience.

Instead, Wilson outlined the 3 major trends he is watching and the 4 areas within to those trends that he’s particularly interested in. Right there, on the stage of LeWeb, Wilson made it very clear what his investment goals are. And, since he’s investing real money in these areas, it’s safe to assume they are where he expects to see massive growth in the next 10 years.

Wanna know what they are?

  • Networks
  • Undbundling
  • Smartphones

Networks:

Wilson is very bullish on networks, and he started with the analogy of old newspapers. Editors decided what to cover, assigned reporters, and reporters got the stories. Now, thanks to networks like Twitter, people decide what’s news and what isn’t.

Besides media and content, though, he points out other industries that are now being disrupted by networks: hotels by Airbnb, Hollywood by Kickstarter, and education by Codecademy and the like.

Unbundling:

“People are starting to deliver much more focused services–best of breed services–and you can buy them a al carte.”

Wilson pointed again to newspapers, which used to house all the global, national, and local news one person could want in a day. Now, of course, we go to many different sites that focus on being the best in their given vertical.

He then talks about several industries that are experiencing unbundling: banking, education, and entertainment.

Smartphones:

Well, obviously. Mobile is exploding (well, maybe not yet). But, it’s going to. Wilson calls us all a “node on the network,” and in a hand-raising poll of the audience, most attendees would choose to have only their smartphone, if they had to choose between that and a computer.

The connection of the “nodes on the network” impact industries like transportation (Hailo), banking (Dwolla), and even dating (Tinder).

There, on the stage of Le Web, Wilson laid out all the “secrets” to getting in with Union Square Ventures. If you have a startup that’s innovating in one of these big trends, it looks like you have some phone calls to make.

The Startup Fred Wilson And Union Square Ventures Would Back Right Now

Fred Wilson, Union Square Ventures, avc.com, investor, startups, New York startupThe startup and venture capital world breathed a sigh of relief earlier this month when New York based venture capitalist, blogger extraordinaire and managing partner at Union Square Ventures, announced he was investing in Coinbase a startup that helps facilitate Bitcoin transactions. Sure Bitcoin is a hot commodity these days, just ask Ashton Kutcher, but there was more to it than that.

For many, Wilson’s investment in Coinbase was one of those big “signaling issues”. As most know, Wilson has been in a two year slump with investments while he tried to figure out what the next big thing was.

His firm, Union Square Ventures, did just fine with investments and made some great bets during Wilson’s cool period.

So what’s next more Bitcoin startups? Wilson has always been one to go ahead of the curve, so undoubtedly whatever he invests in next will go to that record. Wilson just saw an exit with Tumblr, for which he was an early investor.  Some of their other great investments include Boxee, Turntable.fm, Twitter, Twilio and countless others.

Regardless of what’s actually in the pipeline, we can tell you for certain, if you read Wilson’s personal blog, avc.com, if you’ve got a team of college graduates who’ve developed the next thing that’s going to stop Google, and big hint here’s it’s not Bing, Wilson would go all in.

In a tribute to his daughter Jess who just graduated from College earlier this week, Wilson acknowledges the fact that he and USV often bet on college drop outs but he writes;

“Dropping out of college is all the rage today in startup land (even dropping out of high school). And when it comes to our business, we really do not care if someone went to or graduated from college. We have funded many college dropouts and will continue to.

But there is also something to finishing something you started. ”

So just to be clear, Wilson will still bet on dropouts but I’m willing to bet a college graduate team may have a special place in his heart these days.

As for what’s stopping Google, Wilson also wrote a short, sweet and to the point post called “Running the table”. In the post he talks about how Microsoft “ran the table” with desktop computing, Apple did it with mobile computing and Facebook did it with social networking. That was until Apple and the internet stopped Microsoft and Twitter stopped Facebook.

As for Google, Google is trying to run the table with the “entire fucking internet” and Wilson wants to know “Who Will Stop Google”.

So if you’ve got a college graduate team ready to stop Google, you better get that deck in front of Wilson.

Read Wilson’s blog avc.com daily.  Got that startup ready, make sure your business plan submission includes a clear description of your operations and current progress and take it on over to Union Square Ventures, 915 Broadway, 19th Floor, New York, NY 10010, make it interesting, Wilson’s a busy go.

Here are Wilson’s Venture Capital Do’s & Dont’s 

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