Seed Capital From Angel Investors: Mike Hirshland, General Partner, Polaris Ventures (Part 2)

By guest authors Irina Patterson and Candice Arnold

Mike: We do quite a bit of seed investing. We’ve been doing seed investing since Polaris was started.

Irina: When was Polaris founded?

Mike: It was founded in 1995. That’s when they started raising the first fund, and they started investing in 1996.

Irina: What is your specific role?

Mike: I’m a general partner. There are a handful of us who are partners and we all do the full gamut, you know, investing, board work, firm management, the range of VC activities.

Irina: What is your personal geographical focus?

Mike: Mainly the San Francisco Bay Area.

Irina: And for the entire firm?

Mike: The entire firm is national. We don’t really do much international, but we do investing across the United States with particular focus on the Boston area and the San Francisco area. We have a growing practice and presence in New York City as well, primarily in media and digital media related opportunities. And then we have a smattering of investments across the country.

Irina: What are your current sources of deal flow?

Mike: I would say more than 90% comes from our network broadly – entrepreneurs whom we know, whom we backed before, current portfolio entrepreneurs, folks who we work with a lot in various capacities in this startup eco-system. And then, over the two years, increasingly a source of our deal flow has been Dogpatch Labs.

We started Dogpatch about a year and half to two years ago, originally in San Francisco. I pulled together the first Dogpatch in San Francisco as an experiment. We were seeing a lot of activity, particularly in the social Web space, very young entrepreneurs, bootstrapped, who were doing really interesting things.

We thought it was a promising category of entrepreneurs to be following and getting to know. The thing that we became aware of was that for most of them, the founding stage was usually their laptop and their kitchen table or Starbucks for a meeting.

It was a painfully lonely process we started to hear from these people. We got the idea that it would be pretty compelling to the startup community if they had a home base, a place where people could go for meetings, could work out of, use as an office, could have events at, and even just go to socialize and have a little bit of a community place.

In full disclosure – giving credit where credit is due – the idea actually came from Mark Pincus, the founder of Zynga. I was on a plane ride with him, and he was telling me that he was just starting Zynga and he had bought a building called the Chip Factory in Potrero Hill in San Francisco.

His plan was just to use a portion of the building for his own company and then to use the rest as what I described as a home base, a hangout, a community center for entrepreneurs in the San Francisco area.

And then what happened was he said, “You guys should take an office here and be a part of it.” I loved the idea. My partners loved the idea, so we did. But in pretty short order, Zynga started taking off and Mark decided he needed the whole building, so we moved out.

Mark didn’t have the time or space to pursue the idea, but we loved the idea and thought that we would do it. That’s when we started Dogpatch Labs.

Irina: How does it work?

Mike: We provide the space and the infrastructure around the space, bandwidth, power, kitchen, you know, all that stuff.

We invite entrepreneurs whom we meet and are impressed with to spend six months at the lab. We have two different tiers. There’s a fairly nominal fee that covers our costs, but we also have a scholarship program for entrepreneurs who aren’t yet funded and maybe can’t afford that, who come in free. It’s typically a six-month stint there.

Very deliberately, we don’t have a contractual relationship with the entrepreneurs in the lab. We don’t have an ownership stake in any way, we don’t have any contractual rights for future financing or otherwise.

What we’re trying to do is create a hub of entrepreneurial energy in the Dogpatch Labs where we have a great group of entrepreneurs. In addition to work space, they have each other. It’s the notion of a community where different teams help other teams out.

This segment is part 2 in the series : Seed Capital From Angel Investors: Mike Hirshland, General Partner, Polaris Ventures
1 2 3 4 5 6 7 8 9