✉️ Issue #109: Dear Claremont Founders...
An open letter to the Claremont founders we had the pleasure of interacting with and investing in this past year, and a reflection on the 2023 Claremont startup data we gathered.
💬 Welcome to issue #109 of Between the Lines
Good morning & happy Thursday. We hope the start of the new year is exactly what you need!
Here at StoryHouse, we wanted to let you know that we truly enjoyed our interactions with you this past year and have the utmost admiration for each Claremont founder who charts a course to make their entrepreneurial dream a reality. As founders ourselves, we know the highs are higher, and the lows are lower; the days are long, and the nights uncertain.
Alfred Tennyson wrote in his poem Ulysses (h/t to
), excerpted below:…Death closes all: but something ere the end,
Some work of noble note, may yet be done,
Not unbecoming men that strove with Gods.
The lights begin to twinkle from the rocks:
The long day wanes: the slow moon climbs: the deep
Moans round with many voices. Come, my friends,
‘T is not too late to seek a newer world.
May 2024 hold your newer world! We look forward to reconnecting in 2024 and wanted to share some insights we put together from the Claremont ecosystem this past year. 👇
~ Josh, Miles, Pat
📊 6th Street Stats: 2023 Claremont Startup Data
Authors: Josh Tatum & Miles Bird & Patrick Go
Just about any way you cut it, Claremont startup data in 2023 confirms what we’ve all experienced as founders this past year — 2023 was a really challenging year. Less capital was raised, there were fewer exits, fewer unicorns, and many companies shut down. Mid-to-late-stage Claremont startups were hit the hardest, and we saw far less investment activity and graduations from Seed to Series A and Series A to Series B than what we have seen in past years.
Despite a challenging year, we took a closer look at the data and are excited by some stories we see emerging. While later-stage startups were hit the hardest, the number of companies founded this year stayed similar to years past, and the amount of Pre-Seed capital raised was actually the highest we’ve seen in the past five years. This leads us to believe that Claremont builders were not deterred or scared off by the sour market but were instead motivated to take entrepreneurial leaps this year. The strongest alloys are forged in the hottest fires, and based on historical data, startups are the same.
Some nuggets from our data:
We tracked over 100 new Claremont startups founded in 2023. This is the fifth year in a row that this number has surpassed 100. Claremont alumni continue to take big entrepreneurial swings in large numbers. Healthcare was the most prevalent industry Claremont founders founded businesses in this year. 2023 also had the oldest average founder age at the time of company founding that we’ve seen in the past five years. In 2023, Claremont alumni who founded a startup were, on average, 35 years old.
The VC dollars may have been down from the record heights of 2021 and 2022, but still, 100+ different Claremont-founded startups raised close to $2B in venture capital dollars in 2023. Biotech drew the largest amount of capital, followed by Energy and Healthcare. A few of the most notable Claremont raises n their respective stages:
Sundeck raised a $20M Seed Round from Coatue, Factory, and New Enterprise Associates. Sundeck, founded by Jacques Nadeau (PO), is a data infrastructure and analytics company that rewrites, rejects, reroutes, and enhances snowflake queries.
Living Carbon raised a $21M Series A, led by Temasek Holdings. Living Carbon was founded by Maddie Hall (CMC), and they are genetically enhancing CO2 capture and storage in trees to fight climate change. Maddie is also a StoryHouse CEO!
NOCD raised a $34M Series B, co-led by 7wire Ventures and Cigna Ventures. NOCD, founded by Stephen Smith (PO), is an online therapy platform for the treatment of OCD.
Cytovale raised a $84M Series C, led by Norwest Venture Partners. Cytovale was founded by Ajay Shah (HMC), and they focus on advancing early detection technologies to diagnose fast-moving and immune-mediated diseases.
Glowforge raised a $20M Series E, co-led by DFJ Growth and Foundry Group. Glowforge, founded by Dan Shapiro (HMC), manufactures 3D laser printers intended to offer printing services on a wide range of materials.
The Bay Area, LA Area, New York, Seattle, and San Diego continue to be the top five hubs for Claremont founders, both in terms of companies founded per year and dollars raised per year. The top five industries for Claremont founders in terms of dollars raised and companies founded in 2023, were Biotech, Fintech, Energy, EdTech, and Healthcare.
There were still major exits for Claremont-founded startups, and two new Claremont-founded unicorns were crowned:
Casetext was acquired by Thomson Reuters for $650M. Casetext, co-founded by Jake Heller (PZ), uses advanced AI and machine learning to build technology for legal professionals, creating solutions that help them work more efficiently and provide higher-quality representation to more clients.
Humu was acquired by Perceptyx for $500M+. Humu, co-founded by Laszlo Bock (PO), is an HR Tech startup that uses science and machine learning to help organizations transform at scale and improve their employees’ happiness, retention, and performance.
Apptentive, co-founded by Robi Ganguly (PO), Mike Saffitz (PO), and Andrew Wooster (PO), was acquired by Alchemer for $100M+. Apptentive is a software development company that allows businesses to measure shifts in customer emotion and gather feedback across their mobile customer journeys.
Kobold Metals, founded by Kurt House (CMC), raised a $200M Series B led by T. Rowe Price at a $1.7B valuation. Kobold is pioneering digital exploration by applying statistical modeling, big data aggregation, and foundational ore-deposit science to materially improve the pace and efficacy of natural resources exploration.
Headway, founded by Daniel Ross (PO), raised a $125M Series C led by Spark Capital, at a $1B+ valuation. Headway is making mental healthcare more accessible to everyone by building the first software-enabled network of therapists who accept health insurance. We’re investors in Dan’s new business, which we’ll be able to share more about in the future!
With Headway and Kobold Metals, there have now been 20 different Claremont startups that have reached unicorn status in the last three years!
Finally, and perhaps the most important thing to share, though we have no empirical data point to quantify the unquantifiable, countless founders are rising to the occasion who aren’t listed above. They’re keeping their businesses alive; they’re refining their product and closing their first customers. We know this because we’ve spoken to hundreds of you this past year. Between Miles and I, we had 728 different meetings and calls with Claremont founders in 2023. 😱
A down and difficult year? Absolutely. But it was a necessary one. You can’t have the peaks without the valleys. The Claremont startup ecosystem is one of the strongest university ecosystems in the world and will be stronger on the other side of these challenging years.
We’ve now tracked ~1,600 Claremont-founded startups that have raised $55B+ in VC: ~1,000 of them are still private with a combined approximate value of ~$65B. ~200 of them have been acquired over the years for ~$50B, 22 of them have IPO’d for ~$260B in combined market cap value, and 20 of them are currently valued at over $1B each in the private markets.
The Claremont startup ecosystem continues to grow, and we are lucky to be at the center of it, spending our days and nights working for our founders and building connectivity for the larger ecosystem with StoryHouse Ventures — the first-ever venture firm dedicated to Claremont Colleges alums.
This was our second year deploying capital out of StoryHouse Fund I, and we evaluated 249 Claremont financings this year. We invested ~$2M in 15 different Claremont-founded startups at inception, pre-seed, and seed, and invested ~$900K in follow-on investments in 4 of our existing portfolio companies in Seed and Series A rounds. Across these 19 investments, our co-investors included a16z, Madrona, Greycroft, Felicis, Google Ventures, Khosla, 8VC, and Quiet Capital.
The bulk of our focus continues to be on investing in the best Claremont founders from as early as inception through the Seed stage. Our ownership targets are between 2-5% with every investment, with check sizes ranging from $50K-600K. The portfolio is now 27 companies strong, and we have primarily invested in BioTech, Dev Infrastructure, Healthcare, and Enterprise Software.
We believe pretty strongly in the value of emerging and smaller funds like StoryHouse and don’t think there is a better value per dollar investor on the cap table for Claremont founders. Despite taking up much smaller ownership than most VCs, StoryHouse has still been able to drive outsized value for our portfolio companies. Our biggest assets to our portfolio companies continue to be our help with talent, downstream capital, and supercharging our Claremont network:
Talent: We have been able to consistently help our portfolio companies make many of their first key hires through our networks and our resources like our Newsletter and StoryBoard. For three of our portfolio companies, we actually introduced the co-founders to one another. Just recently, we helped one of our portfolio companies Delos, founded by CMC and HMC alumni Frederic Huynh and Georgi Dinolov, make their founding engineer hire through the HMC network and our LP, Josh Jones.
Capital: Through our VC network and introductions so far, we have helped 7 of our portfolio companies raise subsequent rounds of financings at increased valuations since our initial investment. We help our founders close out their current rounds of financing when we invest, with our investor network, and we make countless introductions for the subsequent financing rounds. Recently, we also helped one of our investments, Terra AI (founded by HMC alum Anthony Corso), negotiate their term sheet with Khosla Ventures.
Claremont Network: Our ability to be the connector within the Claremont ecosystem has continued to drive positive outcomes for our portfolio companies. We make numerous customer introductions, advisor introductions, and investor introductions for all of our portfolio companies. These introductions often lead to advisors joining the team, paying customers, and future investments. Most recently, we introduced PO alumnus and StoryHouse LP Matthew Estes to one of our portfolio companies, Edulis (founded by PO alum Nina Warner), and this introduction ended in Matthew joining Edulis as a Co-Founder.
We provide institutional-like support and outcomes but only take angel-type check sizes. We are very excited for 2024 and plan to make another 10-15 investments to round out our StoryHouse Fund 1.
So, as we jump into 2024, please don’t hesitate to reach out. We’d love to stay in touch.
If you are planning on raising, want to have a check-in call with us, are looking for your next startup to join, want to get more plugged into Claremont and the work we are doing, or whatever else, we’d love to continue engaging.
Feedback? We love to hear it. Hit us with an email. 👊🏼