FounderPool is running two early-stage pools and a late-stage pool, and plans to ramp up entrepreneurs admitted to the program in early 2021
Your startup may become the next great company. It’ll take years and sacrifice and opportunity cost to find out.
FounderPool allows you to unlock the value of your equity and diversify your risk before an exit.
Advisors who rarely help you are dime a dozen. Founders who are in your shoes are the best resource. Share the best insights from the people in the trenches like you.
Meet the other qualified founders in your category if you pass screening. Categories are by stage of company (post seed, series A, B) or by vertical (Fintech, SaaS, Biotech, Space tech etc) or a mix of verticals.
You interact with your favorite founders and rank qualified startups. So does everyone else. FounderPool’s algorithm invites you into a pool based on the Gale-Shapley algorithm for stable matching. Once you’re invited to join, you contribute upto 5% of the equity you own (not % of company) to the pool and get a proportionate amount of pool shares in return.
You get pool membership which proportionately represents equity in all startups in the pool. You can focus on your startup and we take care of community and pool management. Once a pool is formed, new companies may be allowed in, with consent from all existing members.
This is your own version of the Paypal mafia. Investor introductions, growth tactics, customer relationships and whatever else you need, your personal support group helps, inspires, and supports you. Think of it as your team of Avengers.
and why they believe in the FounderPool vision
"I’ve done equity swaps before with friends that trusted and who were building companies at the same stage as me. It’s the best way to hedge startup risk and get an advisor with a different skill set in your company. It provides a great incentive to help each other be successful as you scale out your companies"
"If founderpool had been available back in W16 when I went though YC, I would absolutely have participated. I also think this is a tremendous way to really bring the batch together and learn more about different businesses / maintain relationships for the long term. My perspective is something like this could also offset risk and incorporate diversification into a founder's future wealth pool while maintaining a strong founder community."
"The greatest trade-off with being a founder is to let go of opportunities to invest in other companies is due to lack of cash & time. Over the period of 5-10 years, there are at least a dozen life-changing opportunities that do incentivize a founder to go-to freelancer or investor round. My batch had at least 10-20 companies that I really wanted to invest time or cash but it wasn't possible due to resource strain but if there was an option to swap equity with the pool, we would've been very glad to do it. Like, give out 20% of my equity to other startups in exchange for theirs. This'll create a massive pool of strong founders who are able to grow"
"Starting a company should not be all or nothing. De-risking will open up entrepreneurship to under represented demographics, especially people who grew up in lower income households."
"I believe that in order to succeed as a startup founder, you need to be incredibly hard working and creative at the same time. Hard work - that's on you, but creativity... Creativity is largely collaborative. I believe FounderPool can help me and founders like myself to be more creative, therefore find unique solutions to problems which we (mostly) can't solve by ourselves."
"I've always been a zero-hedge all-in kind of guy because I get max performance with that kind of commitment. I hope to connect with others like me and I can't think of a better way than to pool equity and invest along side fellow peers."
Founders pledge a small portion of their vested equity to a pool consisting of equity contributed by other similarly situated, mutually selected founders. This group becomes jointly vested in each other’s success, and each member has a long-term hedge provided by the overall performance of the pool’s equity.
Your transfer of a portion of your personal equity stake in your own startup is governed by the transfer rules that your company has in place. In some cases, this could require approval by your board of directors. We can help explain to your board why participation in FounderPool is a win/win that helps ensure that you as a founder remains aligned with the interests of your company’s investors (by providing some measure of hedging against a loss that allows the founder (you) more flexibility in pursuing an ambitious, long-term, high-value exit for the company — while building a helpful network and focusing on your company instead of financial worries).
Big misalignment between founders & VCs:
VCs take dozens and dozens of shots on goal, founders only take one.
Founders should band together & share upside. VCs should facilitate this.
If VCs can raise new funds off the back of paper markups and stack new mgmt fees, why is it taboo for founders and team to do similar via secondary if they’re all in & need to spend 10 yrs building one thing while potentially getting married, having kids etc. along the way.
"The great majority of investments I made, I don't expect them to make it honestly through this trough. I just don't.”
“ ...the best safety net is the wisdom of the community and the experience of fellow entrepreneurs.”
"Everyone claims that they understand the power law in angel investing, but very few people practice it. I think this is because it’s hard to conceptualize the difference between a 3x and a 300x (or 3000x) return.
It’s common to make more money from your single best angel investment than all the rest put together. The consequence of this is that the real risk is missing out on that outstanding investment...
Instead of downside risk... think about upside risk—not getting to invest in the company that will provide the return everyone is looking for. "
The average founder is finished. Only the most resourceful and resilient will survive. Using a “crazy” number like 36months should reset your timeframe. This isn’t a 3-6month thing. It may be measured in years...
Investors say "Don't take the early M&A offer. Build the business". But sometimes it's so tempting to take the security. .......partial founder liquidity can relieve that and get investors and founders on the same page to say "Let's go for the dream. Let's go for the big opportuity and not worry that it'll be ruinous."
If company management companies existed, there would be an additional service they could offer clients: they could let them insure their returns by pooling their risk. After all, even a perfect manager can't save a company when, as sometimes happens, its whole market dies...
When you signed up, you'd trade your company's stock for shares of this pool, in proportion to an estimate of your company's value that you'd both agreed upon. Then you'd automatically get your share of the returns of the whole pool.
Startups require luck.
All successful founders (those that have built “Unicorns”) had great skills and great luck. Skills need no definition, as they are widely understood and recognized. We know them when we see them, be it in engineering, product development, sales, marketing, or operations.
But luck is hard to define, so I use Michael Mauboussin’s definition. According to him, luck has two key attributes:
TL;DR: The world appears to be suffering from a shortage of entrepreneurs. The main reason is the very risky nature of entrepreneurship: Society pays average founder millions of dollars but pays nothing to the median founder. We could build a financial fix (a founders’ mutual) to ever so slightly reduce this risk. This would move hordes of talent from their safer BigCo jobs into entrepreneurship. It could also give society more innovation per venture dollar risked.
Interested in partnering with us? Send us a message