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20VC: Accel's Dan Levine on The Current State of Seed & Series A, The Rise of Pre-Emptive Rounds, Solo Capitalists and Multi-Stage Funds Entering Seed & Market, People and Product; What To Prioritise?

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Nov 12, 2020

Dan Levine, a Partner at Accel and former Dropbox executive, shares his insights on the evolving landscape of seed and Series A funding. He discusses the rise of pre-emptive rounds and how to navigate them, revealing the biggest myth about securing Series A capital. Levine examines how multi-stage funds are impacting seed investments, sharing critical data on portfolio outcomes. He emphasizes the importance of balancing people, product, and market in assessing startups, while discussing the risks associated with market timing.

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ADVICE

Investment Evaluation

Focus on people, market, and recent progress when evaluating investments.
Look for efficient initial market insertion and consider team capabilities.

ADVICE

Market Timing Risk

Avoid market timing risk if possible, especially if it relies on outsmarting others.
Great people can make markets larger, but not all markets are suitable for VC.

INSIGHT

Software Thesis

Dan Levine's core thesis is software's transformative power, leading him to invest in developer tools and infrastructure.
He believes software is making everything more efficient.

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Dan Levine is a Partner @ Accel, one of the world's leading venture firms with a portfolio including the likes of Facebook, Slack, Qualtrics, UiPath and Deliveroo. As for Daniel, he actually joined Accel in 2010 before leaving to join Dropbox. At Dropbox, he worked on the platform team helping open the platform to third-party developers and launched and managed many of the company's developer-facing initiatives. Following Dropbox, he rejoined Accel and has led investments in Scale.ai, Mux, Vercel and Sentry to name a few.

In Today's Episode You Will Learn:

1.) How Dan made his way into the world of venture with Accel? How that led to his joining Dropbox? What led to his re-joining Accel 3 years later?

2.) How does Dan assess the current state of the seed and Series A landscape? How does Dan analyse the rise of pre-emptive rounds? How does Dan determine when to lean in and pre-empt vs when not to? What does Dan think is the biggest myth about raising a Series A?

3.) How does Dan analyse multi-stage funds so actively entering seed? What has Accel's seed portfolio data shown? How many went on to raise a Series A? How many did Accel lead? How many companies died? What is the biggest problem this portfolio presents?

4.) How does Dan analyse the trio of people, product and market? How does Dan approach market sizing? How does Dan approach the risk associated with market timing? What risk is he willing to take? What is he not? When can one stretch on market? When is it a stretch too far?

5.) How does Dan evaluate the rise of solo capitalists? What does he see as the core pros and cons of the model? What are the pros and cons of the partnership model like Accel has? How does Dan evaluate the rise of investor personal brands today? What worries him?

Item's Mentioned In Today's Episode

Dan's Favourite Book: Titan: The Life of John D. Rockefeller, Sr. (Vintage)

Dan's Most Recent Investment: Altinity

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