Deals

One of venture capital’s harshest critics — Adeo Ressi — is launching a VC firm

Above: Expansive Ventures founders Adeo Ressi and Jon Soberg.

Image Credit: Expansive Ventures

Adeo Ressi launched his reputation in Silicon Valley in 2007 with TheFunded, a website that was (and is) harshly critical of venture capitalists, with specific — and often damning — reviews of firms and their partners.

Now, six-and-a-half years later, Ressi is becoming a venture capitalist himself, starting an investment firm called Expansive Ventures.

Together with partner (and VentureBeat contributor) Jon Soberg, who was formerly with Blumberg Capital, Ressi’s new firm will focus on early-stage companies, leading and participating in seed rounds of $500,000 to $2 million with proven entrepreneurs — those who have a track record. For promising but as-yet-unproven entrepreneurs, Expansive will participate in (but may not lead) investment rounds.

Expansive did not say how big the fund would be. It plans to begin looking at potential investments this summer.

It will benefit from Ressi’s role as the CEO of the Founder Institute, a training program and network of startups and executive mentors with global reach. However, Expansive will be a separate entity.

Ressi has come a long way since he first arrived in Silicon Valley in 2007. The Founder Institute has now expanded to 78 different cities around the world, in a kind of franchise model that identifies local executives and entrepreneurs with experience and matches them up with new founders.

More than 3,100 CEO mentors are part of the network, and the Founder Institute claims it has graduated over 1,100 companies from its program so far. Mentors at Founder Institute include the CEOs of Uber, Evernote, Zipcar, and Mint. Graduates from the program include Retailigence, Udemy, Appota, and Zirtual.

Mentors will play a key role in Expansive Ventures, too, as each one will have one “invite” they can use to get Expansive to consider a company for potential investment.

As soon as they use the first invite, mentors will be given two more. Those who make introductions that result in an investment will receive compensation —  in some cases with equity, by being added to the team, or other mechanisms.

“We’re committed to finding a way to compensate people for helping us,” Soberg said.

Companies don’t have to be part of Founder Institute for Expansive to consider them for investments.

The firm hopes to invest in 10 to 15 companies per year, with about 35 percent in the U.S. and the rest outside the country. Notably, it has no plans to take board seats.

“The best value you can provide as an investor at early stage is to provide the CEO with a good mentor and not to saddle them with a board meeting every month,” Soberg told me. Plus, he added, “It just doesn’t scale.” In his previous gig, Soberg held 18 board seats at one time — which put enormous demands on his time and travel budget.

For entrepreneurs, Soberg said, “We’ll be one of the friendliest investors out there.” In fact, Expansive prefers using the term “founder-centric,” not just founder-friendly. Ressi’s track record as an advocate and mentor for startups certainly bolsters that claim.

“We believe that founders build great companies and we want to support founders who are doing that,” Soberg said.

 

 

 

 

More about the companies and people from this article:

Blumberg Capital is a classic, early-stage venture capital firm focused on investing in innovative and disruptive Digital and Social Media, SaaS/Technology Enabled Services, Mobile Technology and Internet companies. We strive to collab... read more »

Jon Soberg has over 17 years of experience as an investor, entrepreneur, and operational executive. Prior to joining Blumberg Capital, Jon held CEO, COO and CFO positions at several startups, and has built large organizations from the... read more »

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