Entrepreneurs Roundtable With Howard Morgan from First Round Capital – Recap

Tonight I attended the Entrepreneurs Roundtable monthly event in NYC. If you are an entrepreneur working in the tech sector in NYC, you should attend this event. Murat Aktihanoglu from Unype organizes the event and the law firm of Fulbright & Jaworski host. There’s no charge to attend and there’s free snacks and I thought the discussion was lively and well-received.

The discussion featured Howard Morgan, Ph.D from First Round Capital. Here are my notes:

• The amount of venture capital needed to go from idea to first shipping customer has continued to drop. Ten years ago one of their companies needed $20 million, five years ago $2 million and many of their companies today need less than $1 million.
• They hired someone in China to design the First Round Capital logo for $30. They use Rent-A-Coder often for development projects.
• They focus on six items when reviewing a company for investment: People, Product, Plans, Profit, Patience and Persistence
• They like when the founders/execs are located in the same city and work out of the same office. It’s ok if the development resources are located elsewhere.
• First Round Capital receives 2,000 plans a year; meet with 500; invest in 20
• Morgan noted that the mobile and enterprise markets are currently exciting; local hasn’t been cracked yet
• Areas that benefit from the current economic downturn: jobsites and retraining organizations
• Morgan noted that many early stage VCs are slowing their pace as many need more money for their existing portfolio. He said it is definitely tougher out there but there is money out there as well.
• One important note: Morgan said that they will not fund unless the funding will last to the 2nd quarter of 2010.

I will have some videos from the startup pitches over the next couple of days.