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VC at Spark Capital where I focus on disruptive Internet & mobile investments, Husband to Hilary Koyfman, insatiably curious, strategy junkie, brand & design obsessive, art lover.
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spark capital

Sift Science

The Internet has enabled the seamless flow of commerce in an unprecedented fashion. But where transactions go, so do bad actors. We currently estimate online fraud to be a $40B problem, and it’s just getting worse. The few rarified Internet giants like Google & Amazon have built large dedicated teams and sophisticated technology solutions to combat fraud. But what about everyone else? Even our largest commerce and marketplace investments at Spark suffer from fraud and have turned to third parties for help.

I am thrilled today to announce that Spark Capital is leading a $18MM Series B financing of Sift Science, the world’s most advanced fraud prevention platform. Sift Science empowers online merchants with real-time, large-scale machine learning via an easy to integrate API that unlocks deep customer insight and helps businesses large and small prevent fraud on their sites.

Sift launched it’s first machine learning as a service product just over a year ago, and today analyzes more than $1.5 billion of transactions and 600 million events each month. They have grown their customer base over 50x in the past year and today power fraud prevention across the globe for high-growth businesses like Airbnb, Uber, JackThreads, Kickstarter and HotelTonight. With an API that can be integrated in a day, a real-time fraud console, and plugins for Shopify and Magento, Sift is simply the easiest and best fraud prevention service on the planet.

One of the most exciting things about Sift’s machine learning platform is that it continues to get smarter and better as more customers join the Sift network. Each customer brings unique data to the platform that Sift utilizes to identify and weed out bad actors wherever they may appear. In true Internet form, everyone on Sift’s network benefits from everyone else’s collective data and intelligence.

Sift Science is a new style of SAAS business, utilizing easy to integrate APIs for distribution, leveraging a freemium business model and benefitting from terrific network effects at scale. We’ve made a number of investments in this area at Spark and will continue to look for more.

I’m thrilled to join Jason, Fred and the rest of the excellent Sift Science team to help them realize their vision of making the Internet a safer, better and more profitable place.

Storefront

Over the past number of years, there’s been an ad-hoc explosion in ‘pop-up’ retail spaces. We’ve also seen the emergence of meaningful brands being built online that are finding in-person experiences to be massively additive to their businesses. As our world becomes ever more digitally connected, I believe we are increasingly yearning for complementary in-person experiences that are uniquely rich, fresh, integrated and responsive.

I’m thrilled today to announce Spark Capital’s Series A investment in Storefront, the world’s leading marketplace for short-term retail. Storefront makes it easy for any brand, business or artisan to find a space to showcase, market and sell their wares without any of the burdensome, expensive and long-term commitments of the typical lease. Some more details on Storefront’s terrific early progress here.

Whether you’re an Etsy seller, Warby Parker, an aspiring art gallerist, or Samsung launching a new phone, Storefront can help you find the right space for your needs.

On the flip-side, Storefront allows property owners to maintain freshness and flexibility with their spaces while providing higher yields. It also opens up spaces that would have never before been considered easily short-term rentable such as shop-in-shops, street fair booths, restaurants spaces and subway kiosks to name a few.

The seamless connection of online and offline experiences is a big deal, and Storefront is poised to help lead this charge. I couldn’t be more excited to partner with Erik, Tristan, Ron and the terrific Storefront team as they execute on this ambitious vision.

SkillShare

I am proud today to announce Spark Capital's investment in Skillshare along with our friends at Union Square Ventures.

In it’s simplest form, Skillshare is a community marketplace for offline classes. In it’s ultimate incarnation, Skillshare has the potential to become a truly democratized learning platform.

Our passion for the education space at Spark has been no secret. We’ve made investments in Altius Education, 8D World and most recently Peer Transfer.

With Skillshare, we are partnering with a team and platform that is rethinking how education should be delivered and who should deliver it. This is no small task, but Mike, Malcolm & company are certainly up for the challenge.

Michael and I have been building our relationship over the past number of years. I have been consistently impressed by his integrity, clarity of vision and fantastic product instincts. All of these qualities shine through in even this first iteration of Skillshare.

In many ways, Skillshare taps into some of the most important web and mobile trends we are observing today.

Firstly, I’ve made no secret of my love for marketplace businesses. The web was built to connect people and Skillshare does so in one of the most important ways possible. Enabling the teacher and student in each and every one of us is a noble endeavor.

The idea that each of us has something of value to share is a profound one as well. Unlocking this ‘knowledge inventory,’ similar to how Airbnb unlocks latent real estate inventory, is a powerful idea and source of previously untapped supply.

I am also increasingly fascinated by businesses that leverage online platforms to drive offline experiences. Building vibrant online communities that facilitate rich in-person interactions is something I believe the web and mobile devices will do increasingly well over time, making these interactions ever more important parts of our social behavior.

Joining Mike, Malcolm, ZachAlbert and the entire Skillshare family is a privilege. I couldn’t be more excited to head on this journey with them.

Spark Capital is Hiring

thegongshow:

We are hiring for two new positions at Spark Capital.  

One new role is an Analyst position.

We’re looking for someone to help us organize the collective knowledge of the firm and the portfolio using a combination of web services and entrepreneurial grit.  

The gig is probably most similar to a Product Manager role inside a small startup.  Being only eight people on the investment team, Spark is a bit of a startup of its own, and the analyst’s role would be to find help us scale our network, our internal reporting, and our effectiveness with portfolio companies’ management.

This role is a great way to learn what venture capital is all about.  It’s also a role that would require taking on incredible responsibility outside typical experience one day, and also handling very administrative basic tasks the next day; each of which are critically important to success in this job.

Learn more about the Analyst role…

The other new role is an Associate.

The term “associate” means different things at different firms.  At Spark, here is how we define the role:

An associate at Spark is part of our investment team in our Boston office. He or she will help our team with market & competitive analysis, process deal flow, source new investment opportunities, due diligence potential investments, assist our portfolio companies, attend & organize meetups as well as various other firm responsibilities such as annual reports and portfolio analysis.

This is not a classic two year and out program. We are looking for someone that will grow with us or possibly join one of our portfolio companies over time. The investment team at Spark is small so there is no clearly defined path or mentorship. You need to be ready to make your own way.

Learn more about the Associate role…

How to Apply:

If you’re interested in the Analyst position, throw your hat in the ring via this form.

If you think the Associate gig is your cup of tea, then get in touch with us here.

If you apply for one job and we think you’re a better fit for the other job, we will let you know and shift things around appropriately.  A good way to think about which role you fit best is work experience.  0-1 year experience is likely best for the Analyst role whereas 2-4 years is likely best for the Associate role.

I’m happy to answer any questions about these jobs in the comments, so hopefully the answers will benefit everyone.

We look forward to hearing from you…

GDGT

I’m thrilled to announce Spark’s investment in gdgt and welcome Peter, Ryan and the entire gdgt team to the Spark family.  You can find me on gdgt here.

The technology & gadget category has rightfully been core to the web from it’s inception. Naturally, the early web participants were tech enthusiasts and the web flourished with sites oriented around their needs.

CNet led the way on users reviews and price comparison. Engadget and Gizmodo led the way in content, which Peter and Ryan themselves helped pioneer.

Like in many of the early web verticals however, innovation has not always kept up. gdgt is attempting to bring the best of what the social, user-driven web is all about to this incredibly large category.

At the core of gdgt are real user profiles, gdgt lists and user contributed content. Connecting people with relevant user created content when they are looking to make a purchase or need help with gadgets they already own is where the power of gdgt lies. Ultimately it’s a place where the hard-core gdgt geeks and casual consumers can meet to share information, get advice and help make purchase decisions.

We at Spark are lucky enough to be in business with two of the web’s true gadget pioneers and a phenomenal group of investors. We’re just at the beginning of this journey and very excited for what lies ahead.

Staying The Course

There’s been a lot written lately about VC seed programs and some of the issues they present for entrepreneurs.  Most notably, Chris Dixon has written a number of excellent posts on the topic.  See here and here.

We’ve approached seed investing at Spark a bit differently, and we think it helps alleviate some of the concerns Chris and others have raised.

The basic premise of Start@Spark is that we want companies who ‘start’ at Spark to ‘finish’ at Spark.

This first principle is the key driver of how we think about seed investing, and it has a number of very important implications for the firm as well as entrepreneurs:

1) We approach seed investments with the same level of scrutiny that we do all investments.

2) We take active roles in all the companies we seed.

3) We go into seed investments expecting to fund companies in subsequent rounds.

4) We are flexible in how we structure seed investments as well as subsequent rounds of financing to not disadvantage the entrepreneur.

This ultimately results in only a handful of seed investments to which we bring everything Spark has to bear.  While we may be giving up the option value of having many small seed investments from which to cherry pick, we in turn gain a much closer relationship with the companies that we do seed which goes a long way towards ensuring that they get subsequent financing.

So why do we do seed investments?  Fred Wilson wrote an excellent post recently on slow capital.  There are many benefits to taking a staged approach to investing.  It gives everyone a chance to learn, get to know each other better, understand business and capital needs more clearly, create a disciplined, milestone-based culture and generate results that help attract new investors.  And in the off-chance it becomes apparent that the business prospects are not what everyone hoped, reach the appropriate but difficult conclusions together.

There is also the macro reality that capital requirements for many web services businesses have come down precipitously.  It is important that venture firms adapt to this landscape and continue funding the best and the brightest at the earliest stages of development.

There are many advantages to taking seed money from a quality venture firm.  It just needs to be done right.