Venture Capitalist

Welcome to Hero City, land of opportunity — and heroic levels of hype

hero cityMarch 5, 2015 - Located directly across from Draper University on 3rd Avenue in downtown San Mateo is Hero City - a large co-working space that is home to roughly 50 startups. Membership to Hero City includes access to conference rooms, meeting space, kitchen and lounge area, mentors, and exclusive events. In addition to the co-working space on the main floor, the bitcoin accelerator Boost VC is located downstairs, along with a large auditorium that is used to host events and conferences. The upstairs floor holds offices for Draper VC funds and desk space for angel investors, dubbed "Angel Landing." Hero City and Draper University are both part of VC Tim Draper's larger Draper Ecosystem where all the pieces - entrepreneurs, startups, angel investors, and VCs - come together as one:

"VCx brings in billionaires (mostly from abroad) who have cash and want to diversify into tech, so they supply the capital. Draper University brings in the talent. Hero City supplies a workspace for the fledgling companies. The executive education program fosters connections with companies that can become valuable partners for the startups. The VCs upstairs invest the capital in the most promising of those companies. And when they grow big enough, these companies migrate to nearby office spaces."

Read the entire Venture Beat article by Dylan Tweney on Hero City here.

Invest Like a Legend: Tim Draper

Tim DraperFebruary 5, 2015 - Tim Draper, founder of DFJ and Draper University, is "one of the grand middle-aged men of Silicon Valley finance" and his investments have been behind successful companies like Hotmail, Skype, and Baidu. In this article, he shares his advice as "Silicon Valley's whackiest investor." Here are the main takeaways:

  • Best investments: Hotmail (1995) and Theranos (2003)
  • Winning traits: An entrepreneurs with big ambition and a unique quality
  • Losing traits: Not thinking big enough or having unique enough technology
  • What to invest in: Bitcoin
  • How to invest: Diversify heavily

Download the entire article on the world's top investors here: Legends 2015

A Brief History of Venture Capital for Entrepreneurs

January 20, 2015 - As the old adage goes, history often repeats itself, and speculators are always trying to figure out when the next bubble will burst. Entrepreneurs have a lot to learn from venture capitalists and the history and trends that inform their investment decisions. In this blog post, we summarize the history of venture capital as written by Jerry Neumann in this article. Read on for main takeaways and trends by decade - all of which may be a hint of what's to come.

1960s

As technology improved, time truly became an item of luxury. If a venture capitalist moved too slow, that VC might miss out on a deal of a lifetime. VCs knew they had to move quickly not only to keep up with the times, but also to secure deals.

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Lessons of the 1960s

Time is a luxury. It not only affects VCs, but also entrepreneurs. The more VCs you know, the better - meet and stay in contact with as many as you can.

1970s

A change in government regulations allowed pension funds to be considered a “prudent” investment. This spurred change within the venture capital community because VCs were now armed with pension funds as extra money, which they then used to invest in early stage companies.

venture-capital-policy

Lessons of the 70s

You better believe venture capitalists stay up-to-date on government policies, and you should too. Information is power, and past, present, and future venture capital will continue to be influenced by government in some way, shape, or form.

As an entrepreneur, you can use the fact that venture capitalists are getting in early on your company to always ask for help and mentorship. Early VCs will be just as interested in your success as you are.

1980s

Venture capitalists realized what were once top returning sectors were no longer the top returning sectors. Something had to give, and VCs started to invest in different directions and new sectors. Many VCs ended up investing in later-stage companies and already-established markets, thereby going against what they had learned in the 70s about investing in early stage and not heavily established markets.

venture-capital-gem

Lessons of the 80s

Venture capitalists are always looking for diamond-in-the-rough sectors to invest in, but sometimes they accidentally miss them or just aren’t positioned correctly.

1990s

The Internet changed everything. After seeing the early successes of Internet companies like Amazon and Netscape and their IPOs, venture capitalists ramped up investments in Internet companies. An influx of VCs looking to invest meant an influx of money so that anybody and everybody associated with the Internet received investment from VCs.

venture-capital-internet

Lesson of the 90s

Venture capitalists are human and follow visible trends. If you stay up on the latest trends, you may literally be "following the money" is those trends become a reality. 

Early 2000s

The hype caught up to venture capitalists. Unfulfilled promises sent stock prices tumbling thus defining the 2000s as the era of the dot com crash. However, because of their investments, VCs helped usher in a new era of technology, and their failed investments may have actually helped humanity in the long run.

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Lesson of the early 2000s

Venture capitalists, entrepreneurs, and humans in general make mistakes all the time. Was believing the Internet hype justifiable? In a way, yes, but it did cost a pretty penny. By using and learning from your own and others' mistakes, you can bounce back and ultimately help others.

Late 2000s

Not all was lost in the 2000s. Social media took off like a rocket and created another market for venture capitalists to get into. VCs have backed well-known social media companies that now shape our daily lives and habits.

venture-capital-rebound

Lesson of the late 2000s

Just like entrepreneurs, venture capitalists will fail and fail again until they succeed. VCs were willing to give Internet companies another chance, and it was a good thing they did or we may not have Facebook and Google was we know them today.

Today

There are thousands and thousands of companies in already established markets seeking funding from venture capitalists. If this trend continues, VCs, entrepreneurs, and the rest of the world may face stagnation. VCs are in danger of returning back to the ways they invested in the 1980s.

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Lessons from Today

History seemingly repeats itself at will. Entrepreneurs and venture capitalists must be aware of history and use it to their advantage.

Recap of Lessons Learned by VCs

  • 1960s: Use time wisely
  • 1970s: Information is power and success is more likely with a team
  • 1980s: When opportunity knocks, open the door
  • 1990s: Trends might become future reality - stay at the forefront
  • Early 2000s: Learn from your mistakes
  • Late 2000s: Fail and fail until you succeed
  • Today: Be brave

Silicon Valley Predictions for Entrepreneurs, Startups, and Venture Capitalists in 2015

January 14, 2015 - Humankind has been trying to predict the future since the beginning of time. Let’s look at some of the Silicon Valley predictions for entrepreneurs, startups, venture capitalists in 2015:

1. Bitcoin/Blockchain will continue to play an important role in our lives.

Venture capitalists and angel investors invested more than US$250 million in 2014, and you can expect even more in 2015.

2. There will be a growing need for better data utilization.

You've got your CEOs, CFOs, CTOs, and now: CDOs?

3. Machine learning will leave everybody wanting more.

With mass adoption of Google Now and Siri, consumers and venture capitalists can only expect more goodies.

4. Two industry titans are beginning to sweat...profusely.

Xiaomi, the world’s most valuable startup, will scare the pants off Apple and Samsung in 2015.

5. Cybersecurity budgets will grow, and possibly explode.

Being “Sony’d” is a verb now. To all entrepreneurs and startups working on this issue: take the publicity with Sony and run with it!

6. Silicon Valley fully wakes up to health care.

“Healthcare represents nearly 18% of US GDP (and rising), making it perhaps the biggest market opportunity for venture capitalists and investors anywhere.”

2015-silicon-valley-predictions

These trends are changing the world as we know it. Stay ahead of the curve and come to Draper University's entrepreneurship program where you'll meet the movers and shakers behind these predictions. Apply now for our Spring 2015 class at http://draperuniversity.com//apply-2/.

Draper University & Ugly Brother Studios now casting for TV Show - Apply Now!

Draper University is proud to announce we are now casting for our upcoming TV show. We've partnered with Ugly Brother Studios for a TV show that will follow selected students as they build and launch their startup in Silicon Valley. Together, we are seeking young entrepreneurs with brilliant business ideas who would like to enter the Spring Residential Program and be featured on the series! Selected students will be followed as they enter the hands-on curriculum of the Draper University program and apply their new knowledge, network and skills to their startup businesses.

Hear what Tim Draper, Founder of Draper University has to say about the show:

Draper University alumni have started more than 60 companies, raising over $7.4 million in capital. Some left to join other start-ups or large companies including Tesla and Google.

To be considered, please send the following information to: casting@draperuniversity.com Name: Age: Contact Information: Brief Bio: Tell us why you would be a great candidate & Please attach a current photo of yourself

Draper University in the Taiwanese Media!

November 26, 2014 – Check out this great piece on Draper University out of Taiwan - personal interviews with DU alumni Hua Zhao and Ryan Moon from the Fall 2014 Class and another awesome interview with Tim Draper!

Anything is Possible at Draper University of Heroes

Student Post  July 18, 2013 – They say that Silicon Valley is the place where things happen. Where overhearing a conversation about two guys working on their newest startup at a coffee shop is common place, and where people often reply to your pitch with a "Yes, AND" instead of a "Yes, BUT" or even worse, with a straight up "NO." Yes, Silicon Valley is the place where anything is possible, and this became clear when I convinced renowned venture capitalist Tim Draper to auction off a one-on-one lunch meeting to the highest bidder.

Ana DuranThinking Outside the Box at Draper University

Regardless of whom you are and what position you hold, don't be afraid to fail. However, having a strong network is always useful, and I must confess that being a current student at Draper University in San Mateo, CA might have helped a little to secure the lunch. Draper University is an unconventional boarding school for young entrepreneurs created by Tim himself. In fact, the auction is taking place because my team, the Wonders, is fundraising for "Survival Week" which involves being in a secluded area for five days as part of the innovative curriculum. Fortunately, Tim agreed to help my team out with our wacky idea to auction him off, and we look forward to going off in the wild and surviving from the resources we gathered and the team strategy we devised while he has lunch with the lucky winner.

Be Surrounded by Like-Minded Entrepreneurs

Being at Draper University is about more than just going off on survival adventures or having talks led by top CEOs like Aaron Levie who created Box, or industry leaders like Robert Metcalfe who co-invented the Ethernet. To be here means to be surrounded by a group of thirty-eight brilliant peers from different corners of the world who share a passion for entrepreneurship and disruption, and who will eagerly give you feedback on your business idea regardless of how many times you change it. To be here means to think outside the box like how to drop an egg off from the eight floor without breaking it, and to be prepared to change the rules at any given point like playing volleyball with two balls and no net. To be here means "to do everything in my power to drive build, and pursue progress and change" as our superhero oath constantly reminds us. Most importantly, to be here means to be a hero.

What Does it Mean to be a Hero?

Through Draper University, I have come to redefine my definition of this word. Four weeks ago I would have said that to be a hero means to do something extraordinary that will benefit society. Today, I believe that a hero is someone who is not afraid to fail and who helps raise others up so that together they can do something even more extraordinary. Yes, at DU it is all about the teamwork and helping each other out in order to achieve a common goal. After all, every one has something to contribute to the table, and it is only when we pull all of our strengths together that we become more creative, more valuable, and completely indestructible. And if we fail, we fail together, we help each other up, and we try again until we succeed.

Don't be Afraid of Failure

That is the biggest lesson I have learned since being here, and as obvious and cliché as it may seem, you really need to live it in order to understand it. Regardless of whom you are and what position you hold, don't be afraid to fail. In fact, the only thing that should really scare you is failing and not learning anything from the experience. Everything else, regardless of how bad it is, holds some sort value if you know where to look for it. For example, when I was ten I was diagnosed with leukemia, and as bad an painful as dealing with cancer was, I was surrounded by the best team possible: my knowledgeable doctors, my loving parents, and my supportive school friends. Together, they made chemotherapy more bearable, and when the roughest days arrived and I wish I would die, my team was there to hold my hand and lift me up.

Also, always try to help others and form teams with your family, friends, coworkers, and even strangers. They all have the potential to inspire you and to help you see the world with a new perspective, and you of course can do the same for them. So dream together, execute together and fail together. I believe this mentality is what makes places like Silicon Valley and Draper University so special. I only hope that all the heroes out there will help me share and implement this idea with the rest of world and start working together to do something extraordinary. And even if it fails, it will still be extraordinary.

~ Guest post by Ana Duran who is from Colombia and was part of DU's Summer 2014 Class.

Tim Draper Interview with Raj Mathai of NBC News Bay Area

NBC News Tim Draper InterviewJune 1, 2013 – Tim Draper, Draper University's "zany" founder was interviewed last week by Raj Mathai of NBC News. The interview took place at Draper University, Raj and his crew spent a good amount of time hanging out with us and getting to know some of our students. Check out "The Interview with Venture Capitalist Tim Draper" here: http://www.nbcbayarea.com/video/#!/on-air/as-seen-on/The-Interview-With-Venture-Capitalist-Tim-Draper/209751091