An honest insider review of employment at SeedInvest
Pros
In writing this review, my objective is to provide an unbiased and transparent summary of my experience working at SeedInvest. My experience working for this company differed greatly from what I had expected coming into the job and, as a result, I hope to shed some light on the basics of this company for interested job applicants. In my opinion, there appears to be an abundance of misinformation and ambiguity in relation to what a job applicant should expect from their position. I will try to address the most important considerations that a typical job candidate is likely to have. The following is based on my personal observations during my tenure at SeedInvest, as well as opinions based on my overall experience. 1) The CEOs are pretty great. Both CEOs are smart and easy to work with. They have each been in the industry for well over half a decade and are veterans when it comes to equity crowdfunding. They are both clearly extremely busy yet still find time to catch up with employees and to plan fun events. Ryan is considered a pioneer in the field and he does whatever he can to raise the profile of equity crowdfunding. James is more on the ground and tries to juggle the operational aspects of the company. On the negative side, they are definitely overstretched and can occasionally be rude and condescending (something they should work on given how hard they work their employees for a relatively low salary). 2) Freedom to experiment: You are encouraged to experiment and think of new ways to do things. When you want to try something – the answer will more than likely be “run with it” or “give it a try” (unless it costs a lot of money). The company very much encourages out-of-the-box thinking. For the creative types, this is a big plus. 3) Good team members: The majority of the team, during my tenure, was very good. There are a lot of very smart and very talented people at SeedInvest. There are, of course, pockets of incompetence – but that should go without saying. Most of the team are smart, fun and very hardworking. 3a) Some cautionary advice for prospective employees: There are 2 different types of employees at SeedInvest, in my view. 1) The Cheerleaders: these are the employees who are genuinely and unwaveringly committed to SeedInvest and its mission. For these employees, SeedInvest can do no wrong and has few-to-no faults. These employees are usually younger (joined SeedInvest out of, or shortly out of, undergrad), very enthusiastic and very loud about the ‘virtues’ of the company and also very quick to downplay or ignore any ‘downsides’. Be careful when speaking to the cheerleader employees because you will walk away with a very different impression than if you speak with… 2) The Realists: the views of these employees regarding SeedInvest are generally informed by greater financial experience and tend to be more balanced. If you’re considering a position at SeedInvest – my advice is to speak with current employees, but also to seek out ex-employees for the full picture. 4) SeedInvest is probably the most principled equity-crowdfunding portal. While the due diligence performed at SeedInvest is not very close to the due diligence requirements for venture capital funds – the benchmark seems to be higher than at other equity crowdfunding platforms. In fact, the deals SeedInvest rejects sometimes end up on other crowd-funding portals. SeedInvest also takes valuation much more seriously – the company will readily negotiate valuations lower if they believe them to be too high (something I doubt other platforms do on the same level). They take being a broker very seriously and will go the extra mile to be careful and to follow procedure and policy. 5) There is more freedom when working at a startup. From the unlimited vacation to the impromptu events, the independence of working at a startup (vs. a typical fortune 500 job) is notable. It’s one of the main benefits I hear touted and should not be overlooked. That said, these benefits may seem amazing at face-value, but you should be realistic in your expectations. For example, unlimited vacation is obviously not really unlimited – if you take more than an occasional week, the founders will address it and make it clear that they disapprove. Similarly, the events, though fun, I believe turn out to be somewhat expensive - and thus the more extravagant (and really fun) ones are few. 6) Minimal politics & horizontal management structure may appeal to some. Smaller companies will inevitably lead to less politics and less bureaucracy. SeedInvest is a relatively small company, and thus the politics are and bureaucratic BS is minimal. The management structure was horizontal during my tenure [meaning there are no official levels of middle management between the staff and the executives] which many are likely to appreciate. The positives of the horizontal structure are that it likely helps prevent bureaucracy and internal squabbling; The negatives, in my view, are increased micromanagement and less opportunity for advancement (which could be irritating for the more ambitious types).
Cons
1) SeedInvest is unlikely to help you “break into VC”: This is likely the biggest misconception I hear. The way an equity crowdfunding company operates is fundamentally different from the way most traditional venture capital firms operates. Critical differences include: The amount of due diligence performed, the quantity of deals, closing funds, the amount of capital raised, the system of raising capital – to list just a few. Traditional venture capital positions are highly competitive and the skills you develop at SeedInvest are unlikely to directly transfer to those positions, in my view. During my tenure at SeedInvest, I was not aware of a single employee who successfully lateraled from SeedInvest to a venture capital firm. 2) You don’t really learn very much about the companies or industries: Traditional Venture Capital firms often spend months performing due diligence on a single company, culminating in a fairly comprehensive understanding of industry and internal fundamentals. At SeedInvest, in my experience, most companies are typically reviewed for some hours before they are taken to Investment Committee (though the volume of companies examined at SeedInvest is also likely to be much higher than a traditional venture capital firm). During my tenure, internal models and comparables were rarely utilized. Similarly, during my tenure, Industry reports or industry analyses were rarely obtained or utilized. 3) You’re essentially a glorified salesman: Relating to #2 above – A huge portion of your time is (or should be) spent on the phone reaching out to entrepreneurs – educating them and persuading the seemingly better companies to fundraise through SeedInvest. In my experience, you have very little time to develop a strong understanding of industry fundamentals or to perform any kind of deep company analysis. Some of your performance is measured on how many companies you can bring and pass through investment committee every week. As a result, a substantial portion of your time is spent performing outreach and ‘explaining/selling the platform’. Most of the team seem to enjoy calling themselves ‘venture capitalists’ – but its hardly a fitting title. In reality, it’s more of a ‘sales team facing entrepreneurs’, in my opinion. 4) Your pay is very low for New York City: Be prepared for this. Unless this has changed recently, your starting salary is likely to be very low (barely livable for New York City, IMO). Furthermore, your hours are high – relative to the salary (be prepared to head home around ~7:30 – 8:00 PM) and a good deal of your time is spent performing what I consider to be tedious activities. This would be sufficient if the company were not somewhat stingy with their equity. Even the low pay & low equity position would be acceptable if the company were a unicorn or on its way to becoming a unicorn, which leads me to my next point… 5) This company probably isn’t a unicorn. No one can predict the future, but my personal opinion is that this company is not going to be a unicorn and seems more likely to tread water for the foreseeable future. It’s not necessarily through any major fault of their own, but rather due to equity crowdfunding simply not taking off as many had expected. 6) Addressing the “Disrupting venture capital” claim. You’re probably going to hear a lot about how equity crowdfunding is “disrupting venture capital”. While buzzwords and feel-good mission statements like this are staples of startup companies – a cursory glance at the investment stats shows that “disrupting venture capital” is more of a hopeful dream than reality. Since the launch of Reg CF in mid-2016, the total amount raise through this vehicle is a bit over $100 million, while the venture capital industry invested over ~$84 Billion in 2017 alone. That’s not to say that things cannot change – but as of yet (and probably without significant adjustments to various regulations) equity crowdfunding does not seem to be disrupting anything. 7) This company enjoys talking themselves up. This isn’t unique to SeedInvest; my experience is that most startups talk themselves up – they need to, in order to attract interest, funding, clientele and employees. I’m only noting this as a disclaimer for potential applicants. As an example, you may hear phrases similar to “We’ve increased our user base X amount over the last Y years” or “We’ve grown our revenue by X over the last year” or “We only accept X% of all applicants”. Phrases like this are likely to be accurate, however they are very broad and do not provide you with all of the necessary information needed [ie. How much of that userbase actually invested in a startup or more than 1 startup? Is that revenue growth rate characteristic of startups that are able to exit successfully? How many of all of your applicants were serious companies that were actually taken up by the venture team and how many of those applicants were accepted but then decided not to proceed with SeedInvest? etc.]. To reiterate, embellishing is something that most startups seem to do. If you’re considering a career switch – my advice is to dig beyond the sound bites. TLDR: When to join Venture at SeedInvest, IMO: - If you believe in equity crowdfunding – definitely consider joining. - If you want more freedom and less bureaucracy – consider joining. - If you want to work closely with smart CEOs and a hard-working team – consider joining. - If you want to have more fun than your current job (probably) – consider joining. - If you want to work at a start-up – consider joining. - If your priority is living in NYC and working at a fun office – consider joining. TLDR: When not to join Venture at SeedInvest, IMO: - If you’re looking to use SeedInvest to launch a career in a more established space (venture capital, private equity, etc) – definitely look elsewhere. - If you’re looking for wealth (whether through pay or equity) – look elsewhere. - If you are looking to progress your career in finance outside of working at other early stage companies (equity crowdfunding is a very specialized space) – look elsewhere. - If you are interested in learning, in depth, about various industries and companies – look elsewhere. - If you hate being on the phone a lot - look elsewhere. - If you want to join the next Uber (or Microsoft) – look elsewhere.
