Despite an active and ever-growing entrepreneurial community, Colorado doesn’t quite boast the same venture activity as the traditional coastal powerhouses.
But that doesn’t mean venture capitalists from across the country aren’t keeping an eye on the Centennial State.
During a Denver Startup Week panel on ‘Why the Top VCs Are Taking an Interest in Colorado,’ venture capitalists from outside the state shared their experiences and keys for success in the state.
Natty Zola of Techstars Boulder and Josh Dorsey of Silicon Valley Bank moderated the panel that included Ted Wang of Cowboy Ventures, Andy Jenks of Drive Capital, Arsham Memarzadeh of Lightspeed Venture Partners and Parsa Saljoughian of IVP.
Although each of the panel members work outside of Colorado, they’ve all done deals here in recent memory. They each commented that they’re spending more time here than ever before, due to the rapidly growing startup scene.
“It reminds me of what San Francisco was like in the late 90s, I think this is going to be a tremendously fast-growing ecosystem,” Wang said.
As a seed-stage investor, Cowboy recently invested in Guild Education’s $40 million Series C that was announced in July 2018.
The panelists agreed that startups will always have access to capital if the idea is strong enough, no matter where they’re located.
Jenks cautioned founders not to focus exclusively on raising capital, instead encouraging them to build a great product or service first.
“The goal is not to raise capital, that is not your success metric,” he said. “Capital will come to you if you’re building a great company.”
While Colorado’s growing capital scene has forced some companies to get creative with their growth, Memarzadeh said it has created a scrappy ecosystem. When comparing Colorado to the Bay Area, he encouraged local startups to embrace it.
“Companies built outside the Bay Area are naturally scrappier, so keep that,” he said.
In addition to its scrappiness, the give-first ethos that surrounds Colorado’s innovation scene was evident to the out-of-town investors.
“What Denver has is that strong community and willingness to help,” Saljoughian said. “Make sure to keep that, because that’s what helps drive the industry forward.”
“Keep it relationship driven,” Memarzadeh added. “It’s gotten way too transactional in the Bay Area."
