This post is part of the Hacker Noon Shareholder Series, where we interview some of the super-investors who made the site you're on right now possible.
Mark Tung is the Managing Partner of Change VC—a seed-stage venture capital firm focused on big ideas that generate positive social or environment impact, alongside financial returns.
"Guidance, experience, resources, relationships are what early stage and first-time entrepreneurs really need."
As an founder and entrepreneur turned VC, we asked Tung for his advice to those batting for either and/or both of those teams.
Q1 How and why did you get into the VC game?
I started off as an entrepreneur and realized money was just one facet of what’s needed to create a successful profitable company. Guidance, experience, resources, relationships are what early stage and first-time entrepreneurs really need. I wanted to offer something that I needed when I first started.
Q2 What does a typical day look like for you?
Wake up every morning to TechCrunch, Hacker Noon, WSJ, and WWD. Meetings, meetings and more meetings throughout the day and brainstorm sessions/recaps of the industries at night. Everyone has money or access to money so maintaining and building new relationships is the most important variable in this industry. Luckily, my first company was in the hospitality business, so eating and drinking is in my DNA.
Q4 What would be your advice to aspiring VCs?
Don’t do it unless you have a competitive advantage or relationships that the bigger VCs don’t have. You need a very specific niche. My specialty was access to athletes/celebrities from being the best in nightlife marketing and branding, which gets me heavy deal flow—especially from consumer product startups.
Q5 What would be your advice to a startup that’s been bootstrapping thus far, about when and how to start raising capital?
If you don’t have money, raise money immediately—I’ve never met a CEO that can properly start a business when they still have to worry about how they are going to pay their bills next month.
When you don’t need money, always only take money from the best people. People will always contribute more when they have money invested.
Q6 In your experience with VCs, what makes them (or you, personally) decide to invest in one startup over another?
Always the people. Smart people with bad ideas can figure it out and pivot to be successful. Not so smart people, even with a great idea, will probably still fail.
Q7 Can you tell us about the best pitch you’ve ever seen, and what made it effective?
Best pitch came from this company called Jason Markk. They came in with great packaging, an engaging before and after demonstration, and left behind samples for us to try. The best pitches will be the ones that stand out, good or bad.
Q8 The VC process can be a waiting game - what’s the best way for a founder to follow-up with a VC who’s probably inundated with opportunities?
Do not follow up unless you have a major update to share. If a VC wants to invest, they will chase you.
Q9 VCs do extensive due diligence, but often the same isn’t true the other way around. Do you have any advice for founders about how to find the right investor/s for their company?
Always ask the VC for the list of their investments and then reach out to the founders of those companies.
Q10 What, specifically, does Change VC look for when it comes to total addressable market, startup metrics, and team composition in deciding whether or not to invest?
Since we are the earliest stage possible and the pitch is usually just an idea, team composition and team experience is the most important factor in our final decision.
Q11 The same question, phrased another way - what are some of the red flags that could lead Change VC to decide not to invest?
No experience in the industry that founding team wants to enter.
Learn more about Change VC, Follow Mark Tung on Twitter, or check out more of the Hacker Noon Shareholder Series.