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Don’t Write Off Bizarre Startups
A few of the finest startup investments I’ve made — and a number of the finest that I’ve missed — have been “loopy” or “bizarre” concepts.
Take Density, one of many first startups I invested in again in 2014. Density’s mission is to make sensors that rely folks. Its first product was a door counter that stored monitor of the quantity of people that entered or left a constructing. It appeared like a wierd thought at first.
Once I invested in Density, the corporate was very early-stage. Density was getting turned down left and proper by VCs. It was rejected by Y Combinator too. I invested by Jason Calacanis’ syndicate, which was on AngelList on the time (he now has his personal website —TheSyndicate.com).
The thought appeared each troublesome to tug off technically and never very helpful. However seven years later, Density is flourishing. First, it constructed a big enterprise promoting digital door counters. Seems individuals who personal workplace buildings and airports and different sorts of actual property actually need to know concerning the site visitors coming out and in of their buildings.
And now Density has a brand new product line that tracks motion inside buildings (anonymously), which individuals are discovering all types of makes use of for. For now it’s largely used to make it possible for individuals are staying correctly socially distanced inside buildings. However this received’t be the one use case for this new expertise.
The humorous factor is that no one had thought to construct a sophisticated, networked door counter till Density got here alongside. The thought appeared form of bizarre. After all, the weirdness isn’t what made the corporate succeed. However I discover that nice investments are sometimes like this. The thought is new and slightly completely different, which may make it onerous to evaluate. I’ve handed on a number of offers that appeared too bizarre (even for me) — equivalent to Calm, the meditation app. That turned out to be an enormous mistake, because it could possibly be a tremendous return.
Anyway, the ethical of the story is easy — don’t write one thing off as a result of it appears slightly completely different or bizarre. We regularly attempt to say, “why hasn’t another person carried out this but?” However determining the helpful issues that haven’t been made but is likely one of the principal strengths of a great startup. And the concepts that haven’t been carried out but can simply look bizarre at first look. However bizarre isn’t the identical factor as ineffective — and that’s a lesson each investor ought to take to coronary heart.
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