Tandem Entrepreneurs -- seed investors

http://www.tandementrepreneurs.com/

by vegashacker • 19 years ago

18 29 19 years ago

yubrew• 19 years ago

It would be nice to know more about their portfolio, such as the companies that have gotten funding from them and achieved a liquidity event.

vegashacker2• 19 years ago

According to this post

http://news.ycombinator.com/item?id=40412

the news.yc user "blored" got funding from them. And blored's profile (http://news.ycombinator.com/user?id=blored) suggests that their site is

http://clutterme.com/

Edit: oh, you said "AND achieved a liquidity event". Yeah, don't know.

blored2• 19 years ago

offered funding, we have yet to decide if we want to accept

blored2• 19 years ago

Tandem is relatively new, it is about two months old.

The best thing about Tandem is that they are made up of good people. The venture raising part was very painless, directly a result of Sunil's professionalism.

vegashacker2• 19 years ago

Their FAQ (http://www.tandementrepreneurs.com/html/how_we_work.html) says, "We typically invest $850,000 in a company over three stages."

nickb• 19 years ago

Looks like they offer a lot of value. What percentage of the company do they take and what's the valuation they typically expect? Do they offer more money than YC?

rms5• 19 years ago

If only they did biotech...

davidw• 19 years ago

Convince them why they should:-)

rms5• 19 years ago

They should fund me because my company is a money winning proposition with the $10,000 my partner and I put up but we could scale much more quickly with a real investment.

We can't get any money from the traditional biotech establishment without patents. And we can't get patents until we have some money because most of our patentable ideas will require more expensive lab equipment than we have right now. So for now, we try and make some money by bootstrapping and selling incense, then we get the patents, then we get the real money, then we start the interesting research like curing AIDS which offers a multi-billion dollar payoff.

My company is selling a a genetic test for HIV immunity. With funding, we could expand into other genetic tests very quickly and get FDA approval for as much as we can. FDA approval is not required to sell a "home-brew" genetic test but you can charge a lot more money if you're FDA approved because then insurance will pay for it.It won't take much to dramatically undercut all the existing genetic tests on the market, they're all really overpriced.

For now, I'm enjoying the process of bootstrapping and approaching biotech with the Web 2.0 "make it yourself" ethos.

Seedcamp told me they don't do biotech. Techstars sticks to Web 2.0 function companies. CRV doesn't do biotech. HCP does biotech and has a summer program targeted to college students for it. We didn't get in and they didn't tell us why, though it was still a really nice rejection and they invited us to a barbecue at their office.

YC might fund biotech if they liked you enough but they aren't a good fit for me. The biotech incubator geographically close to me is dumb and I won't give them any control of my company. They're one of those state-subsidized institutions that repeatedly lose money. This is why Pittsburgh sucks for entrepreneurs, because despite the brilliant biotech minds coming out of our universities, there is not nearly enough investment money available.

I should probably email Tandem and ask if they do biotech. Anyone know any seed stage funding firms/incubators that would consider biotech?

myoung8• 19 years ago

Without saying it on their website, Tandem is just another incubator. I would be skeptical of this type of setup.

A friend of mine has dealt with a similar company in Mountain View that shall remain nameless. At first things were going well, then they wanted to outsource the development to India, then they wanted to take 50% of the company. Needless to say he didn't sign with them.

Not all incubators are bad (YC, obviously, isn't), but the bottom line is don't get caught up when numbers with a bunch of zeros on the end get tossed around.

Think hard about their value proposition. If they even mention outsourcing the development, just walk away.

vlad• 19 years ago

Everything they said was nice until I went to their application and read this:

"Tandem backs existing and potential founders who combine strong technical abilities with a keen understanding of their users and a deep passion and energy for building services for fast-growing business or consumer communities."

What the hell is that?

rms5• 19 years ago

They prefer to fund smart people who can build profitable services.

DougR5• 19 years ago

I'm one of the guys at Tandem and am glad to see the discussion here. As some posts have pointed out, we explain our approach in detail on our site: http://www.tandementrepreneurs.com. To clarify things a bit more...

1. We're not a VC. We're all entrepreneurs and love building businesses. We put in our sweat first and foremost and happen to invest sufficient capital as well. We only invest our time and money where we can add value.

2. We offer deep business development and technical skills and an extensive network. We work as the extended team so the startup can stay small but still have the right quality and quantity of talent.

3. We love the YC approach of supporting entrepreneurs and drew inspiration from their model. That being said, there are some key differences. Namely, we get actively involved in each business. We invest funds to carry the company for two years to a potential exit or to a high growth trajectory. And, like YC, we leave open the possibility of a small, early acquisition as exit. As we all know, this is a likely outcome these days, even though the VCs don't like them.

4. Because of our involvement we can get involved with founders whose plans are still nascent, and sometimes we'll help put founders together on a business. To us the entrepreneurs are more important than the idea itself.

5. We typically look for technical founders who have a knack for understanding what their users want and then delivering it quickly. We don't encourage outsourcing development unless it's just for commodity components of the overall service.

6. We don't consider anyone a "reject" because a fund passed them by. We'll evaluate each team and business on its own merits and go for it if we like the people, think we can add a lot of value, and believe we can build a valuable business together. Obviously, each group of founders has to decide the same on its side.

7. Tandem is brand new, but we have a lot of experience at building startups. We've made two investments thus far and with three principals only plan to do about 6 per year. In many ways, Tandem is a startup itself in that we're breaking the traditional model, having a blast, taking encouragement and support with open arms, and proceeding full steam ahead regardless of what certain "established" parties in venture finance say.

8. We are happy to entertain folks that have gone through the YC process as well as those that are entering it. In fact, we're attending the YC demo day next week.

Best of luck in building your own startups, and we'd love to hear what you think about Tandem. Feel free to contact us if we can help.

gibsonf1• 19 years ago

Your new business model sounds interesting. I went to your website and noticed the many disclaimers about using email to get in touch with you. What is the best way to make contact with you? (I'm a cofounder of streamfocus.com)

DougR5• 19 years ago

The best way to reach us is by email. If you send something to apply@tandeme.com or info@tandeme.com, we'll all get it. And we try to read everything and respond.

pg3• 19 years ago

Leaving open the option of an early acquisition is a difference from YC?

DougR5• 19 years ago

No, didn't mean to imply that. I know YC enables early exits and is different from a VC in this regard, just like us. I think the difference is our very active involvement and funding level. I was trying to point out that we leave open the early exit option even while providing approximately two years worth of funding. Will make a small edit to clarify...

staunch• 19 years ago

Sounds very positive. The really important thing that isn't addressed very well is how you want to add "sweat".

Most entrepreneurs are interested in having the final say. Real control over product development, marketing, etc. Is your attitude that your team is there to help when necessary but otherwise hands off or do you insist on being involved in day to day operation?

Would you mind clarify this a bit more?

DougR5• 19 years ago

Sure. How we add sweat is very subjective and is much easier to answer in context of a particular business. It tends to be very clear on all sides by the end of our first meeting. That being said, here is a high level answer and a couple of examples...

We are entrepreneurs, and as such just do what is needed. If we don't believe we can add value to a business, we don't get involved. We insist that the founders control the various aspects of the business, but we also look for opportunities that need our support on a day-to-day basis in the beginning. Once the business has some level of traction, we step back and make ourselves available when and where you need us (including help on large strategic deals or even to sell the business). If you don't need or want our help and are only looking for money, we are not the right fit.

The key elements in execution are - the right thing to do, the right time to do it and the right way to do it. We participate with the founders to help make these decisions on both the technology and business sides. We help where needed on strategy, marketing, bus dev, and tech architecture and provide the infrastructure needed on the administrative side (legal, finance, pr, etc.).

Couple of real life examples. In one of our businesses, certain technical scalability issues were identified and the question was how to solve them and when to solve them. We got involved and were a valuable resource for the founders as we understood the business objectives, development resources and the underlying technology. If need be, we can tune queries and look at code, but most of the time acting a good sounding board is all that's required.

In another case, there was a key question on the initial go-to-market approach for the business. Here, we brought people from other related organizations to the table to help in our decision. We worked with them and the founders to make an informed choice. So far, the results have been very positive...

joshwa• 19 years ago

What percentage of a company do you look to take?

DougR5• 19 years ago

As entrepreneurs, we value our sweat and take a founder-like common stake for our participation. In a way, you can view working with us as adding another founder to your team, although you drive the day-to-day operations, and we help where and when needed. The exact common stake we take varies by opportunity. The $850K is invested at standard valuations in exchange for preferred stock. Again, if you don't need or want our help and are only looking for money, we are not the right fit.

richcollins• 19 years ago

Tandem is funding our company. At first I had reservations about a hands-on approach: "I'm an independent, iconoclastic programmer! Just give me my money and get out of my way!"

Now that I am over my ego, I have really come to appreciate the fact that I have to give minimal thought to legal, accounting ... etc. It is also really nice to get immediate assistance with strategic, technical and networking (social, not computer) issues.

I would be happy to answer any questions people have about our experience with them. Either here or via email (richcollins@gmail.com).

Tandem Entrepreneurs -- seed investors

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