Sean Brown takes investing personally. As a founder of multiple businesses and venture capital firm GO VC, Brown knows what it’s like to build something real, and profitable, from just an idea. His startups wouldn’t have been as effective, he says, without a personal stake in their success — and he looks for that same commitment from the entrepreneurs he works with today. We asked Sean Brown how he recognizes a good investment opportunity, and why it’s important to provide more than capital when he works with a startup.
What defines your investment process?
Brown started several companies of his own before focusing on investments, and said that his early experiences were one of the reasons he founded GO VC. By connecting with entrepreneurs who share his perspective and vision for growth, Brown is doing more than investing — he’s giving business owners the help that he could have used when he was in their position. “Healthy financials and a strong business plan are obviously important, but I also look for people who have skin in the game, for lack of a better term,” Brown said. “I started investing with my own savings, and even though that’s not a pre-requisite, I like anyone who bets on themselves and believes in what they’re doing.”
How do you work with portfolio companies?
As an early-stage venture capital firm, GO VC has worked with multiple portfolio companies at various points in their funding process. While more stakeholders can occasionally slow things down, Brown says, it’s not a problem as long as everyone’s visions are aligned. “We like to get involved and provide marketing and resources, not just capital,” Brown said. “GO VC investments are more like partnerships, which is what portfolio companies are too, so it’s actually in our wheelhouse to talk to those groups.”
What does your typical investment look like?
How many companies do you invest in annually? Brown’s experience founding tech and marketing companies made those types of businesses an early target for GO VC. But even though Brown says GO VC’s total number of annual investments is usually in the single digits, a few years in the investment world and his own natural curiosity has opened up many more possibilities. “Providing expertise that can apply to lots of different businesses as well as capital has really opened things up,” Brown said. “We know that our support system can foster growth, whether we’re investing thousands or millions in funding. If the people and the ideas are a good fit, we’ll make it work.”
How does the VC funding process work for your firm?
For Sean Brown, the funding and investment process is nothing like Hollywood’s portrayal of Wall Street or Silicon Valley. Brown lives in Orange County, Calif., with his wife, Casey Brown, and their two children, and his approach to investing is about growing companies, not his own reputation. “At GO VC, we can move fast with prospect companies and due diligence, but that’s more about timing a market opportunity than getting press or something,” Brown said. “We’re focused on the work we’re doing, and if we get media attention that’s fine, but it’s not a priority.”
Which is better for a startup seeking funding — a great revenue model but no user traction, or great user traction but no revenue?
Startups with limited resources might feel like they have to choose between building their user base or a sustainable financial plan, but the point of investors like GO VC, Brown said “Our initial focus is usually on revenue, but I’ve seen companies get massive valuations based on user traction,” Brown said. “We consider those aspects and more when we talk to startups, but what always resonates with me the most is entrepreneurs who can balance their excitement for ideas with realistic expectations for growth.”