I'm considering investing through Wefunder instead of waiting for the next Funders Club YC fund. First, I want to learn more about how you think you compare to them. What's the difference? Are you as good at picking winners? Is your investing thesis different?
FundersClub is also great at picking winners. We’re offering the same level of service and access to the same pool of startups with no fees, where FundersClub shares 20% of your profits and charges up to a 12% up-front admin fee.
We share a lot of the same deals; 50% of the YC startups we’ve funded have also been invested in by FundersClub. For instance, we’ve both funded Goldbely, StatusPage.io, One Month Rails, StatusPage.io, Regalli, and 7 Cups of Tea. It’s easier for insiders to pick the top 10% after they’ve had three months to make progress during the Y Combinator program.
In 2013, FundersClub had an advantage because they were able to invest in companies earlier than us, as we previously did not offer an investment vehicle like The Orange Fund. This means they were able to get in on “hot deals” well before they were oversubscribed on demo day. For this reason, we lost out on great companies that we knew were awesome, like Thalmic Labs and Teespring. We fixed that disadvantage with this fund.
We put more focus on evaluating startups by being very active users and customers of their products, and seeing how quickly they respond to detailed feedback. For instance, we funded Zenefits, the biggest win in our portfolio ($15m Series A after 6 months), because it was obvious through all our interactions that the product was vastly superior to anything anyone else could offer and the founders were A+ players.