Comprehensive Investor Profile: Susa Ventures

Investment Thesis and Strategic Focus

Susa Ventures' investment thesis is focused on early-stage companies with compounding moats and long-term defensibility, aligning with market trends in scalable business models and AI-driven innovations.

Core Investment Principles

Susa Ventures centers its investment thesis on supporting early-stage startups that possess the potential to develop compounding moats. These moats are characterized by proprietary data, network effects, and economies of scale, which collectively enhance a company's defensibility and scalability over time. Susa's focus on product-market fit ensures that they invest in companies demonstrating tangible traction and solving genuine problems for their target markets.

• Proprietary data that improves with scale
• Network effects that grow stronger with more users
• Economies of scale that lower costs or increase efficiency

Alignment with Market Trends

Susa Ventures' strategic focus is well-aligned with current market trends that favor scalable and defensible business models. Their sector-agnostic approach, with particular interest in fintech, healthcare, logistics, enterprise software, and AI/ML, positions them to capitalize on emerging opportunities in these high-growth areas. By prioritizing AI-driven companies and category-defining founders, Susa aligns itself with the increasing importance of technology and innovation in the venture capital landscape.

Evolution of Strategy

Over time, Susa Ventures has evolved its strategy to include a more hands-on operational involvement with portfolio companies, maintaining a low partner-to-company ratio. This evolution reflects a commitment to providing early-stage companies with the kind of support typically reserved for later stages. Their decision to avoid leading Series A rounds allows them to align incentives with founders and preserve flexibility for follow-on investments, ensuring long-term partnership and growth potential.

Portfolio Composition and Sector Expertise

An analysis of Susa Ventures' portfolio composition, highlighting key sectors and successful companies within their investment strategy.

Susa Ventures has carved out a niche in the venture capital landscape by focusing on diverse sectors such as AI, fintech, healthcare, and more. Their strategic investments have led to significant successes and acquisitions.

Susa Ventures' ability to identify and back companies with strong potential in these sectors has been a key factor in their success.

Portfolio Companies and Investments

Key Sectors of Focus

Susa Ventures has demonstrated sector expertise in AI, fintech, healthcare, supply chain/logistics, consumer, enterprise software, and B2B SaaS. Their investment strategy emphasizes emerging technologies such as alternative AI architectures and TechBio.

Sector Expertise

The firm's focus on sectors with strong compounding moats has contributed to its success. By investing in companies with network effects, data advantages, or defensible technology, Susa Ventures has seen approximately 10% of its portfolio companies reach unicorn status.

Examples of Successful Portfolio Companies

Notable successes include Casetext, acquired by Thomson Reuters for $650M, and Expanse, acquired by Palo Alto Networks for $800M. Robinhood's IPO under ticker HOOD further exemplifies their strategic investment acumen.

Investment Criteria

Susa Ventures focuses on early-stage investments in data-driven startups, with a strong emphasis on defensibility and long-term growth.

Susa Ventures' investment criteria are centered around early-stage, data-driven startups with strong potential for defensibility and long-term growth. They focus exclusively on pre-seed and seed-stage investments, typically writing check sizes between $1M and $5M.

One of their notable investments includes backing a 19-year-old entrepreneur's AI memory startup, Supermemory, which demonstrates their commitment to supporting innovative ideas at an early stage.

Funding Rounds and Typical Check Sizes

Preferred Investment Stages

Susa Ventures primarily invests in the pre-seed and seed stages. They emphasize early-stage investments to align with founders' interests and support the company from its inception.

Typical Check Sizes

The typical check sizes range from $1M to $5M, providing sufficient capital to support early growth and development.

Geographic Preferences

Susa Ventures prefers to invest in U.S.-based startups, with a particular focus on those headquartered in San Francisco, CA. This geographic focus allows them to leverage their network and resources effectively.

Track Record and Notable Exits

An objective assessment of Susa Ventures' impressive track record, including notable exits and successful investments.

Susa Ventures has established itself as a leading seed-stage investor with a strong track record of successful investments and notable exits. Since its founding in 2013, the firm has raised over $600 million across multiple funds, emphasizing a concentrated seed strategy that often involves leading investment rounds independently.

The firm boasts a portfolio with numerous unicorns, achieving a tenfold increase in unicorn status compared to the industry average. Susa Ventures' approach has led to several high-profile exits, including Robinhood's IPO and acquisitions such as Casetext by Thomson Reuters and Expanse by Palo Alto Networks.

• Notable exits include Robinhood IPO, Casetext acquisition, and Expanse acquisition.
• Investments span sectors like AI, fintech, healthcare, and logistics.
• Portfolio companies often secure Series A funding at twice the industry average valuation.

Performance Metrics and KPIs

Timeline of Key Exits and Performance Trends

Team Composition and Decision-Making

An analysis of the team composition at Susa Ventures, focusing on the expertise of key members and their decision-making process.

Susa Ventures is composed of a team of experienced investors and partners with diverse backgrounds in technology, engineering, and entrepreneurship. The team's collective expertise significantly influences their investment decisions, focusing on companies with strong potential for growth.

• Chad Byers: Co-founder and General Partner, specializes in marketplaces, fintech, and healthcare.
• Derick En’Wezoh, MD: Partner with a background in healthcare and venture.
• Misha Gordon-Rowe: Partner.
• Pratyush Buddiga: Partner.
• Shaheer Sandhu: Investor.
• Courtney Buie Lipkin: Venture Partner.

Emeritus Team

Decision-Making Process

Susa Ventures employs a structured, partner-driven decision-making process. Investment opportunities are sourced by partners, with a focus on companies possessing 'compounding moats' such as network effects or proprietary data.

• Sourcing and Preliminary Review: Focus on pre-seed and seed stage companies.
• Diligence and Deep Involvement: Preference for companies with product-market fit.
• Partner Meetings: Open discussion to evaluate investment opportunities.
• Voting and Decision: Consensus-based voting with weighted votes.

Collaboration with Portfolio Companies

The Susa Ventures team collaborates closely with their portfolio companies, leveraging their extensive experience to provide strategic guidance and support. This collaboration helps in refining business models and scaling operations effectively.

Value-Add Capabilities and Support

Discover how Susa Ventures differentiates itself through tailored support, mentorship, and strategic resources for its portfolio companies.

Value-Add Resources

Susa Ventures stands out by offering a highly involved operational model tailored for early-stage companies. This approach focuses on providing support during critical 'crux moments' rather than constant oversight. Susa believes that successful companies require minimal interference and instead benefit from strategic frameworks and historical insights.

• Capital investment ranging from $500,000 to $5 million.
• Access to a network that assists in securing early customers.
• Support in recruiting key talent for growth.

Mentorship and Networks

Susa Ventures maintains a low partner-to-company ratio, allowing deep engagement with each portfolio company. This structure brings the operating model of late-stage venture capital to early-stage firms, a niche often underserved in the market. The firm focuses on companies with established product-market fit, ensuring that their support enhances proven business models.

• Access to Susa Venture Fellows for mentorship.
• Collaborative community fostering shared learning experiences.
• Guidance through non-prescriptive advice, emphasizing founder autonomy.

Testimonials from Portfolio Companies

Portfolio companies consistently highlight Susa Ventures' unique approach and the tangible benefits they experience. One such company noted the invaluable access to strategic guidance during pivotal growth phases, crediting Susa's frameworks with helping them navigate complex scaling challenges.

Application Process and Timeline

Guidance for entrepreneurs applying to Susa Ventures, outlining application steps, required documentation, and timeline.

Entrepreneurs seeking investment from Susa Ventures must follow a structured application process that involves several key steps. It is crucial to prepare all necessary documentation and understand the timeline for a successful application.

Application Process and Funding Decision Timeline

Application Steps

The application process for Susa Ventures involves submitting an online form. This includes providing a résumé, a one-page market thesis, and two warm founder introductions. Candidates are then selected for interviews based on the initial screening.

1. Submit an online application form.
2. Include a résumé and market thesis.
3. Provide two founder introductions.
4. Undergo interviews if selected.

Required Documentation

Candidates must prepare and submit a comprehensive application package. The necessary documents include a detailed résumé, a market thesis outlining your business vision, and introductions from two founders to support your credibility.

Funding Decision Timeline

The timeline from application to funding decision spans several months. Applications open in June and close by July 31, with interviews conducted shortly after. Selected fellows will commence the program in September.

Portfolio Company Testimonials

Testimonials from portfolio companies of Susa Ventures highlight the firm's deep involvement, operational support, and founder-first approach. These are demonstrated through specific experiences and outcomes that emphasize their high-touch support, founder-centric approach, and strategic investing.

Specific Experiences and Outcomes

Susa Ventures' portfolio companies often emphasize the firm's hands-on approach and strategic guidance. Flexport and Robinhood are notable examples where Susa's early and consistent investments helped the companies achieve significant valuations. Susa's commitment to operational support is evident through their involvement in multiple funding rounds, demonstrating trust and confidence in the companies' growth trajectories.

Common Themes in Feedback

• High-Touch Support: Susa's low partner-to-company ratio allows for significant time and operational involvement, which is often highlighted in testimonials.
• Founder-Centric Approach: Emphasizing substantive help over PR or high-profile events, Susa builds its brand through genuine support and strong founder referrals.
• Strategic Investing: By investing once product-market fit is achieved, Susa provides targeted advice and validation, crucial for early-stage success.

Balanced View of Strengths and Areas for Improvement

While Susa Ventures excels in providing deep operational support and fostering strong relationships with founders, there is limited public availability of direct testimonials from portfolio companies. This suggests an area for potential improvement in transparency and public communication of their impact.

Market Positioning and Differentiation

An analysis of Susa Ventures' market positioning and differentiation strategies in the venture capital market.

Susa Ventures positions itself as a sector-agnostic, founder-first specialist in pre-seed and seed-stage venture investing. By focusing on early-stage tech startups with a proven or emerging product-market fit, Susa differentiates itself through a unique combination of founder support, capital, and talent, rather than prescriptive operational control or board seats.

Competitive Comparisons and Unique Selling Points

Unique Selling Points

Susa Ventures distinguishes itself with a founder-first and non-prescriptive approach, investing exclusively at the pre-seed and seed stages. They maintain a sector-agnostic strategy while focusing on software and emerging technical categories. Their selective investment cadence allows each partner to back only a few startups annually, ensuring deep engagement and support.

Competitive Advantages

Susa Ventures boasts a top-tier seed performance, with a significant portion of its portfolio achieving unicorn status. Their investments typically raise Series A rounds at higher valuations, resulting in lower founder equity dilution. The firm’s dedicated focus on seed-stage investments, supported by aligned fund structures, enhances their specialized expertise for early-stage founders.

Comparison with Competitors

Compared to larger seed VCs, Susa Ventures emphasizes a high-touch, founder-centric approach, avoiding board governance and preferring to build independent conviction in investments. This contrasts with firms like Sequoia Capital and Andreessen Horowitz, which have broader investment stages and sector focuses, often involving more prescriptive guidance and board participation.

Contact and Next Steps

Information on how entrepreneurs can contact Susa Ventures and the next steps to take.

• Email: ops@susaventures.com
• Mail: 660 York St, Ste 201, San Francisco, CA 94110
• Phone: (310) 413-7398

Next Steps for Entrepreneurs

After making initial contact with Susa Ventures, entrepreneurs should give the firm about two weeks to respond. If there's no reply, a polite follow-up email can be sent. It's beneficial to share any updates or progress about your business in this follow-up.

• Wait for a reasonable timeframe before following up.
• Send a polite follow-up email if no response is received.
• Share updates or progress about your business.
• Prepare and attach additional materials such as a pitch deck.
• Request a meeting to discuss your business in detail.
• Consider alternate channels if no response is received.