DougR

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.

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...

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.

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...

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.