Redeye VC

Josh Kopelman

Managing Director of First Round Capital.

espite being coastally challenged (currently living in Philadelphia), Josh has been an active entrepreneur and investor in the Internet industry since its commercialization. In 1992, while he was a student at the Wharton School of the University of Pennsylvania, Josh co-founded Infonautics Corporation – an Internet information company. In 1996, Infonautics went public on the NASDAQ stock exchange.

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Monthly Archives for 2010

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We, We, We so excited for our annual holiday video

Over the last few years, one of my favorite holiday traditions has been putting together First Round Capital's annual holiday video.  In the past we have used song, dance and our impressive physiques to work our way into your hearts over the holiday season. This year has gone by fast and we have added a whole new cast of remarkable characters to our community.  We are really inspired by our talented portfolio and lucky to be able to roll our sleeves up and deliver the 2011 edition of the First Round Holiday Video.  


While it's not yet Friday…we hope it brings you a little holiday cheer.  (Although my kids are getting to the age where their Dad's performance in the video has shifted from "cool" towards "embarassing").  




Thanks to Phin Barnes for the lyrics, Brett Berson for masterminding the entire video, and our portfolio company CEO's for honoring the "participation" clause in our term sheets ;-)   

Saving Time vs. Killing Time

Killing-TimeOver the years, we've met with thousands of entrepreneurs who were starting consumer Internet businesses.  And as we listen to them describe their business, I find myself categorizing the opportunity.  One of categorizations I've found most helpful has been to determine whether the company is looking to help people "save time" or help people "kill time".  

Companies like Youtube and Zynga entertain people (and help them kill time)  -- while companies like Google, LinkedIn and are great utilities and help people save time (but users rarely visit them for without intent or for for pure entertainment).  At First Round, we've funded both:

Why create such a distinction?  Well, I think it is helpful in looking at how the businesses will operate -- and what metrics you care about.  It's much easier to measure the impact of a Kill Time company than a Save Time company.  For example, in a kill time company you'd really want to see strong DAU (daily active user) counts and really long session lengths.  Yet short session length might be a good sign in a "save time" company.   If it took longer for Google to answer your question -- and you spent more time on their site searching -- I don't think that Google would view that as successful.   The fact that allows you to manage your finances quickly and easily is a good thing.  

I think it's typically much harder (for me) to indentify which "kill time" companies will be successful at the seed stage.  The Kill Time companies are successful because they are able to entertain users -- and it's very tricky to identify good entertainment from a Powerpoint.   Save Time companies, on the other hand, are a little easier to evaluate pre-launch -- because these companies have a clear value proposition that can be measured in advance.  When we first heard of Uber, for example, we were able to understand the value propisition and user benefit immediately. 

Finally, the monetization strategies of Kill Time companies typically require much larger customer bases / audiences to be successful.  These companies frequently monetize through advertising or low-price virtual transactions -- both of which require significant volume to generate meaningful revenues.  

This is not intended to be a "perfect" framework -- and I can easily identify several exceptions -- yet I've found it helpful to keep in the back of my mind when I'm meeting with entrepreneurs.   (And there are rare times where companies can be in both categories.  Twitter is one such example.  There are use cases where Twitter can be the perfect way to kill time -- yet it has also become on of the most efficient ways for people to stay current on the news.)