NFX is shaking up venture capital by creating software for presentation platforms and warm introductions

  • Five years after it raised its first fund, NFX has emerged as a prolific early-stage venture company.
  • The company is distinguished by its focus on developing software for founders and offering it free of charge.
  • A web series on how to achieve network effects on startup is now being launched at an early stage.

After she sold her education startup in 2014, founder Amy Lynn started talking about going to the dark side of Startupland: venture capital.

She was skeptical. I thought that too many venture capitalists funneled money to companies without having the knowledge to evaluate the technology they were funding. “I have never felt like venture capital is my people,” Lin said.

But something clicked when a friend introduced it to James Courier and Pete Flint, who were just building an invite. accelerator For startups in 2017. The program is designed to connect founders with the right mentors and investors through a combination of hands-on training and programs. The two investors wanted to hire a product team to change the way founders get financing.

They asked Lin, “If you were to build a venture capital software stack, what would that look like?” She knew the pain of fundraising — and she had ideas. Intrigued, she accepted a position as Chief Producer.

Five years later, the company known as NFX — and its name is a play”Network EffectsShe’s accomplished a lot in her short life. She dropped the accelerator shortly after Lin was hired and moved to a more standard project model. But unlike other companies, it employs about three times as many engineers as investors, and provides free software to help founders raise money and run their businesses.

NFX Chief Product Officer Amy Lynn.

NFX Chief Product Officer Amy Lynn.

NFX



With $1.1 billion in assets under management, the company has acquired stakes in hot startup companies like DoorDash, Lyft, Poshmark and Patreon. And while partners “can’t ride on the laurels” of old companies, Lin said, they win founders by delivering value — through cloud-based software and content — before they even write a check.

“The founders reach out to us and say, ‘You’re really building software, you’re like us.’ When we hear that, it’s like they want to work with us before we hear about the idea for the show,” said Flint, general partner.

The company’s main product is SignalIt is a database for early stage investors that allows founders to search by stage, sector and geography. They can also see the connections they have in common and ask for an introduction — or a “warm introduction” — that paves the way for financing.

Screenshot of Signal, a database of early stage venture capitalists created by NFX.

Screenshot of Signal.

NFX



In 2019, the company debuted Link موجز Brief, a web application for sharing slide decks known as “Planned Presentation Sets” used for fundraising. The program shows the founders who opened their platforms, how much time they spent on each slide, and where they stopped reading. A company spokesperson said the founders sent more than 40,000 presentations to investors through BriefLink, and went on to raise more than $5 billion in total.

Screenshot of BriefLink, a cloud application for sharing presentation groups with investors.

BriefLink screenshot.

NFX



These products are free to use and available to any founder inside or outside the company’s portfolio. Lin said Signal and BriefLink count more than 100,000 monthly active users between them.

Master class in Network Effects

Now, the company is taking the wraps off a new streaming service for founders. The service is not originally named, master class, will release episodes where its general partners and guests discuss the details of entrepreneurship, from fundraising to setting up company culture. It debuted on October 11 with 11 episodes about network effects, a phenomenon that describes a user who derives more value from a product as more users join the same network.

“We’ve been thinking about network effects for over 20 years,” Flint said. Before becoming an investor, he founded Trulia, a website to search for property listings and rental property, and expanded it to more than 50 million monthly users. Merged with Zillow in 2015.

Screenshot of Masterclass, a streaming service created by NFX.

A screenshot of Masterclass.

NFX



Lin said NFX plans to add additional “seasons” with new topics and speakers beginning early next year. The service is free to use.

Flint said the master’s classes build on a well-established tradition of helping founders. But it also serves the interests of the company. Programs like Signal and BriefLink increase the company’s brand awareness, while the streaming service does just that and more. He invites founders to settle in with a cup of coffee and listen to their investors for more than three hours, giving them a taste of all the guidance and support the company has to offer.

And in a market where early-stage capital is plentiful, venture capitalists need to do more than just write checks to compete for the most sought-after deals.

With Masterclass, NFX requires founders to try before buying.

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