First Round Capital

Most people describe finding PMF as an art, not a science. We're here to change that. Introducing PMF Method. After 20 years and 500 investments in pre-product-market fit companies, we've drawn on our data and worked with some of the world's most iconic enterprise founders, distilling what they did in their first 6 months into a free 14-week intensive experience that helps sales-led B2B founders build epic companies. In tactical sessions, we help early founders discover what customers really want, build the right v1 product, and close your first sales — all while keeping 100% of your equity. You'll work alongside a tight group of other builders at your same stage, and get to learn from the hard-earned insights from founders of $1B B2B companies, like Vanta's Christina Cacioppo, Looker's lloyd tabb, Plaid's Zachary Perret, Ironclad's Jason Boehmig, Lattice's Jack Altman, and Verkada's Filip Kaliszan. The Summer 2024 session of PMF Method runs from 5/29 to 8/28. Any early founder working on a new B2B SaaS company is welcome to apply — just get your application in by 5/7 (or tag a founder friend below!) More details, FAQs, and application link in the comments below 👇

A common failure mode Tido Carriero has noticed at startups that made the jump into multi-product? Putting too many people behind a new bet before it took off. “You should have a really clear gate before you seek large amounts of funding that show that your customers are super excited about your next product," says Carriero (co-founder Koala and ex-Dropbox and Segment).

When mulling over what to build next, it’s tempting to just go with what the market data is telling you. But Tara Seshan, former product lead at Stripe and Watershed, cautions against falling into this trap. “Instinct can be a huge driving factor in figuring out when you go multi-product,” she says. Sometimes the right strategy is a bet against the tides of current customer trends.

The decision to go multi-product can make or break the growth of a startup. Take the leap too soon and you’ll lose focus. Launch too late and you’ll lose steam. To make things even trickier, there’s no one-size-fits-all approach. The right call of when, what and how to build a new bet will be different at every startup. So we’ve rounded up some of the best advice we’ve heard from founders and product leaders who’ve made these decisions at companies like Atlassian, Stripe and Gong. From contrarian takes to helpful frameworks, they share what worked — and what didn’t — when they launched new products. Link to the full article in the comments.

During the Y Combinator W24 craze of pitch meetings, I had one particular breakfast with a founder, Rahul Behal. He was intense. He painted a huge vision. But the idea was one I heard before — workflow automation with AI. So why was this special? That company was Gumloop (YC W24) (formerly known as AgentHub), and they just announced their Seed round, which I was proud to lead here at First Round Capital. I couldn’t be more excited about the traction, the customer love, and — most importantly — the founders. Here's a few of the reasons we decided to invest: To start, the team is… insane. Max & Rahul are easily two of the hardest working and creative founders I've met. Their idea of "having fun" or "taking a break" is either squashing tech debt, creating customer content videos, or playing GeoGuessr 🤣 . But what really struck me as special was how Gumloop's customers were using the product. I spoke with customers of theirs whose *entire* businesses were built on top of Gumloop. Literally — the entire product these companies were selling to others was just Gumloop under the hood. I was even more convinced at a recent event I attended for AI leaders at some of the largest companies in the Valley. Most shared how they use AI in end-user products, but hardly any had successfully used AI to help drive meaningful internal efficiencies. Gumloop was one of the only products I've seen where customers say it actually does just that. Finally, I won't lie — their traction was also inspiring. Household-name companies are signing up in spades. One even held a company-wide Gumloop hackathon for all employees. I look forward to watching them continue to crush it and drive efficiencies for everyone! 🎉🙌 ... Read more about what they’re up to in the post in the comments! PS We're excited to be investing alongside some incredible Operator Angels and Investors -- like Max Mullen, Gustaf Alströmer / Y Combinator, JJ Fliegelman, Richard Aberman, Arash Ferdowsi, Andrew Ofstad, Immad Akhund, Liquid 2 Ventures, Matthew Mulvey, Kulveer Taggar, WndrCo, Ben Parr, Matt Schlicht, and Ludlow Ventures.

Best advice I heard this week came from Kareem Amin, CEO at Clay, on the importance of narrowing your scope in the journey to product-market fit. 𝐊𝐚𝐫𝐞𝐞𝐦'𝐬 𝐚𝐝𝐯𝐢𝐜𝐞 "When you narrow the scope, it feels claustrophobic. Why are we doing something that’s smaller when we could be doing something bigger? Eventually, we realized that by narrowing down our scope, we were actually increasing our value. It was actually by cutting off all of the different ways that we supported customers that we saw huge growth." 𝐖𝐡𝐲 𝐢𝐭 𝐫𝐞𝐬𝐨𝐧𝐚𝐭𝐞𝐬 The excitement of going after a massive opportunity is what inspires founders and operators to build/join an early stage company. Moving from the massive opportunity to something more targeted might feel less exciting in the short run but creates the focus and efficiency you need to thrive. You can always come back to the bigger opportunity once you've succeeded in the more narrow focus areas. Company building is a marathon, not a sprint. Be sure to check out the article from First Round Capital!

A great breakdown for founders who want to understand how investors are evaluating you and your startup by Meka Asonye. The call-out on deep customer discovery work is on point. I was coaching a team yesterday on this. Builders are guilty of this - they want to get a product out the door and fast! However, the time spent on understanding the customer and the problem is critical for founders to ideate with a deep, 360 view of the problem. Customer discovery helps unveil blindspots in how you are building the solution (or viewing the problem), clarifies the scope of your MVP, and guides initial messaging to align with the target customer. For builders, there is less resistance to staring at your computer and writing code; I get that. It can feel daunting to spend time doing interviews, customer observation, and research, but it is the work of being a founder. Founders, yes, you have a vision, but fuel it with the voice of the customer!

Founder-led sales with Emery Rosansky (PMF Method Session #6 at First Round Capital). Emery is the GTM 🐐 !

Bold ambition. Strong founding team solving a personal pain point. Compelling why now. Painkiller not a vitamin. Deep diligence work to validate the problem. Early momentum. Out of all of these traits that investors look for, it’s rare to find an early-stage startup that ticks each box. Didero does — this team is the real deal. ✅ Super pumped to be leading their $7M seed round here at First Round Capital. I thought I’d mark their launch day news (TechCrunch article in next post) by digging more into the details of a few of these, in case it’s interesting for founders who are fundraising: 𝗩𝗶𝘀𝗶𝗼𝗻: Didero is an AI procurement agent that automates the most common supply chain workflows for mid-market manufacturers. Their vision? 𝘔𝘢𝘬𝘦 𝘵𝘳𝘢𝘥𝘪𝘯𝘨 𝘸𝘪𝘵𝘩 𝘤𝘰𝘮𝘱𝘢𝘯𝘪𝘦𝘴 𝘢𝘤𝘳𝘰𝘴𝘴 𝘵𝘩𝘦 𝘸𝘰𝘳𝘭𝘥 𝘢𝘴 𝘦𝘢𝘴𝘺 𝘢𝘴 𝘵𝘳𝘢𝘥𝘪𝘯𝘨 𝘢𝘤𝘳𝘰𝘴𝘴 𝘵𝘩𝘦 𝘴𝘵𝘳𝘦𝘦𝘵. Boom. The world of supply chain logistics may be a “dusty industry” as my partner Bill Trenchard likes to say, but this framing of the impact they hope to make on the world doesn't have to be. 𝗖𝗼𝗺𝗽𝗲𝗹𝗹𝗶𝗻𝗴 𝘄𝗵𝘆 𝗻𝗼𝘄: The “why now” piece is one that too many founding teams rush over IMO. Here’s Didero’s: Supply chains are only getting more complex. China used to be a one-stop shop, but now companies are looking to diversify their supply chain — good for the overall resilience of the system, but leads to significant additional work. Before advances in generative AI, this was tricky to solve — communicating in natural language is important here. It’s a smart application of AI to a legacy industry that’s running on 1990s software (at best). 𝗗𝗲𝗲𝗽 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗱𝗶𝘀𝗰𝗼𝘃𝗲𝗿𝘆 𝘄𝗼𝗿𝗸: Tom Petit, Lorenz Pallhuber, and Tim Spencer are truly students of the space. They’ve gone what we at First Round like to call “unreasonably deep” in their pursuit of understanding the problem from every angle. When they pitched us earlier this year, they’d already done calls with 200 supply chain/procurement professionals and industry experts to validate the problem, and were already working with more than a dozen design partners. I don’t see too many pitches where founders walk in having done that amount of homework. 𝗣𝗮𝗶𝗻𝗸𝗶𝗹𝗹𝗲𝗿, 𝗻𝗼𝘁 𝗮 𝘃𝗶𝘁𝗮𝗺𝗶𝗻: This framework is a cliche for a reason — it’s definitely something that will be on investors’ minds as you tee up the problem you’re solving. Didero’s discovery work (and our own diligence) revealed a ton of pain and manual work, specifically in the mid-market segment. Right now, most procurement folks are drowning in manual tasks. By helping people focus less on that and more on the higher order work these employees want to be doing, like building supply chain resilience and deeper relationships, Didero is solving a real pain point (and saving teams real $$$). Confident that there will be even more to share in the months and years ahead — watch this space. 👀

The In Depth podcast by First Round Capital is perhaps one of the top three product strategy podcasts, along with Lenny Rachitsky's podcast and Unsolicited Feedback by Reforge. I recently read the episode featuring Adam Nash co-founder and CEO at Daffy, in conversation with Brett Berson of First Round Capital. Adam shared refreshing takes on product management/development, drawing from his experience at companies like LinkedIn, eBay, and his current venture. Here are 3 of my favorite snippets and the link to the episode 👇