sameer@morpheusventure.com
mailto:nandini@morpheusventure.com
A morpheus application form looks like below to be mailed to mailto:neo@morpheusventure.com.
http://www.morpheusventure.com/startupinfo/MVP_ApplicationForm.doc
morpheus venture partners – Application Form
Application Deadline:
1. Please provide as much information as possible for us to understand you and your project better and assess you rightly.
2. We will not let anyone outside of morpheus look at this application form, including other startups we work with
3. Even if you have a good product that’s live or a great demo, we suggest you provide as much information in this application as we look at the live product / demo based on information in this application.
email this application to: neo@morpheusventure.com
1
Company Info:
a
Name
b
Company URL (if any)
c
Phone number(s)
d
Address(es)
2
What product or service does your company make?
3
Founding team information (Provide all details for each founder, list the main founder first)
a
Name, age, email address, personal url (if any)
b
Current employer and title OR Current college and name of degree (as applicable)
c
Provide details for each college separately:
· Name of college attended
· Year of graduation
· Subject of each degree
d
Provide details for each company separately:
· Name of company worked at and title
· Month, year of joining and leaving
· Roles played at the company
4
Details about the venture/idea; how, when, where, why was the venture/idea started? Basically, the story behind the venture.
5
What is the problem your venture is solving or trying to solve? Provide an example by describing a typical user who is facing this problem.
6
What is the current status of the venture / business?
a
Status of product (alpha, beta, idea-stage)
b
Lines of code written (if applicable)
c
Revenues (if any)
d
Monthly burn rate
e
Current investments and at what valuations
(Self funded, Friends, Family, Angel, etc.)
f
Current shareholding structure
7
What are you looking to achieve / accomplish in the next 6 months?
8
If you have an online demo, what's the url? (Please provide details of username/ password/ promo codes/ invites etc.)
9
Tell us in one or two sentences about something impressive that each founder has achieved / built/ done
10
Talk about an interesting project, preferably outside of college or work that two or more of you have work on / created together. Include URLs if possible.
11
How long have the team known one another and how did you meet?
12
What is it about your business that is missing from existing solutions/products?
13
Who are your direct and indirect competitors? Who do you think will be most dangerous?
14
How will you make money?
15
Please tell us something surprising or interesting that one of you has discovered. (The answer need not be related to your venture/idea)
16
How long will it take for you to have a beta version? A paid version?
17
If morpheus selects you as one of the companies to work with, which of the founders will commit to working exclusively on this project for the next one year (this means no studies, other jobs or other projects)?
18
Do any of the founders have other commitments between Sep and Dec 2008 inclusive?
19
Are any of the following true? Indicate Yes beside the options that are applicable
a
You are the ONLY founder
b
One or more founders will keep their current jobs
c
None of the founders are programmers
20
What do you expect from Morpheus?
Apply http://www.morpheusventure.com/apply.html
morpheus is now accepting applications for the second batch of 2008. It will take place September through December 2008.
To apply, please download the application form , fill up all the information and e-mail it to neo@morpheusventure.com . Last date for submission is 5 August 2008. Teams that submit early have an advantage because we have more time to read the applications.
We'll review applications as they come in and set-up a 2 weeks interaction with shortlisted companies. This will also include face-to-face interaction.
We'll select 5 companies to work with by August 20 , and will also decide the amount of equity we will take. Equity will be between 4% and 8% of the company. The median will be 6%.
Once we communicate our offer to you, your team will have ONE day to make the decision to accept or decline the offer.
morpheus is not an incubator. We have some space you can use if you need to, but we expect you to work out of your office/appartment/garage. It's the ideal setup for the initial phase.
We have built a panel of Subject matter experts with varied expertise and experiences, who will be available to work with the morpheus companies either on a one-off basis or for a longer advisory role, with specific timelines/deliverables built in.
During the 2 weeks evaluation period, morpheus will engage in detailed discussions about the strategy, vision of the team, the product that will be / is getting built, product roadmap, timelines and the market potential.
During the discussion period, morpheus expects that you evaluate the morpheus team, the value they bring to the table, the fit between your team and morpheus and send out any questions/ queries/concerns that you may have. Note: We strongly encourage you to talk to Founders of other companies we have closely worked with. We will be happy to share their contact information with you.
There is absolutely no monitory fee that morpheus charges from the startups it works with. We are willing to wait, the long haul, for 4-7 years – the timeframe a startup may need to reach exit point.
morpheus does not invest money in ventures at this point in time.
We encourage you to ask the founders of other morpheus companies for help. There will be about 20 of them starting September, and they're usually very willing to give advice or make introductions.
About 3.5 months into the program morpheus will organize an one day event where you can present to investors. You can of course seek additional funding from any investor whenever you want.
morpheus program doesn't end after four months. We will continue to provide advice and make introductions as long as founders need and so does the informal network of morpheus companies.
How do we choose who to work with? The people in your team are the most important aspect. We look for intelligence, passion, motivation, a sense of design and the attitude where teams refuse to fail.
The ideal company would have two or three founders. We'll consider those with four or five.
You dont need to have a formal business plan. Just fill the application form with sufficient information.
The original motivation to start morpheus was to work with startups and provide required advice, introductions, etc. but this is not a charity. If startups we work with become successful we will be able to work with more startups in coming months, if they dont, we wont be able to keep doing this indefinately. So we are looking for startups that will be successful.
© 2008 morpheus venture partners
http://www.contentsutra.com/entry/419-morpheus-ventures-on-their-funding-model/
Sameer Guglani and Nandini Hirianniah recently announced the launch of their Y-Combinator modeled Morpheus Ventures. Guglani had sold Madhouse for an undisclosed sum to SeventyMM around the same time last year. More on their funding model in the interview below:
CS: Are you completely out of Madhouse and SeventyMM now? SG: Morpheus has been started by two partners: myself and Nandini Hirianniah. Both were us also founders of madhouse, so we have worked together as a team before. Nandini left seventymm a couple of months back and my last day as a Seventymm employee will be 31 July. Both us will be working full time on morpheus venture partners CS: Are you going to relegate Morpheus to start-ups or build it into a more generic web consultancy? SG: Morpheus will be be focused only on early stage startups, our goal is to work with teams who are 0-12 months old or may be even at the idea stage. Teams who can build scalable and fundable businesses
CS: Why the YCombinator model as opposed to an Angel or Seedfund? SG: Because thats where we believe the gap is most wide. Today there is enough supply of capable entrepreneurs, folks who are taking the plunge - quiting their jobs, putting together a team, building prototypes and dreaming to build a big business. At the same time the supply of money to be invested in startups is also quite enough. Many VC funds, seed stage funds and plenty of angels. These guys are happy to consider investing in companies who are at the right stage, with the right team and the right model. So we add value to both the parties i.e. the entrepreneur and the startup investors using the morpheus/Ycombinator model. For about 4-6 months we work closely with the founders to build the right product, getting the right team, getting initial customer traction and have something impressive ready which will allow them to raise professional funding. To investors our value add is that we are helping in building high quality fundable startups,we will also be conducting demo events where all our portfolio companies will demo their products and the investors can interact with bunch of high quality startups.
CS: What value does Morpheus Venture bring to a start-up? SG: For about 4-6 months we work closely with the founders to build the right product, getting the right team, getting initial customer traction and have something impressive ready which will allow them to raise professional funding. We make introductions to potential investors, partners, lawyers, accountants, domain experts. These are only few main things, the real collaboration will include many more things, needs of each startup are unique and we will adapt to them.
CS: What is the average equity you look at obtaining? SG: Morpheus will be looking at taking 4-8% equity, there is absolutely no monitory fee that we charge. We are in for the long haul and willing to wait for 4-7 years, which a startup may need to each the exit point. CS: What is the average exit period Morpheus is looking at? SG: I would say average would be 5 years, assuming the M&A market continues to develop.
CS: Can you share some start-ups and their products with whom you have been working off late? SG: “We currently have three portfolio companies, two of whom have already raised venture funding
http://ycombinator.com/about.html
What We Do
Y Combinator does seed funding for startups. Seed funding is the earliest stage of venture funding. It pays your expenses while you're getting started.
Some companies may need no more than seed funding. Others will go through several rounds. There is no right answer; how much funding you need depends on the kind of company you start.
At Y Combinator, our goal is to get you through the first phase. This usually means: get you to the point where you've built something impressive enough to raise money on a larger scale. Then we introduce you to later stage investors—and in some cases even acquirers.
More Than Money
We make small investments (rarely more than $20,000) in return for small stakes in the companies we fund (usually 2-10%).
All venture investors supply some combination of money and help. In our case the money is by far the smaller component. In fact, many of the startups we fund don't need the money. We think of the money we invest as more like financial aid in college: it's so people who do need the money can pay their living expenses while Y Combinator is happening.
What happens at Y Combinator? The most important thing we do is work with startups on their ideas. We're hackers ourselves, and we've spent a lot of time figuring out how to make things people want. So we can usually see fairly quickly the direction in which a small idea should be expanded, or the point at which to begin attacking a large but vague one.
The questions at this stage range from apparently minor (what to call the company) to frighteningly ambitious (the long-term plan for world domination). Over the course of three months we usually manage to help founders come up with initial answers to all of them.
Though we fund all types of computer startups, we're especially interested in web-based applications. We've been thinking about that problem longer than anyone else, and by now can visualize much of the space of possibilities.
The second most important thing we do is help founders deal with investors and acquirers. Yes, we make introductions, but that part is easy. We spend much more time teaching founders how to pitch their startups, and how to close a deal once they've generated interest. In the second phase we supply not just advice but protection; people are more likely to treat you well if you come from YC, because how they treat you determines whether in the future we'll steer deals toward or away from them.
We also get the startups we fund incorporated properly with all the right paperwork, avoiding legal time-bombs that could kill them later. We introduce founders to lawyers who will often, because of the YC connection, agree to defer payment for legal work. We regularly help startups find and hire their first employees. We advise about what to patent, and when. One of the least publicized things we do, for obvious reasons, is mediate disputes between founders. No startup thinks they're going to need that, but most do at some point.
The kind of advice we give literally can't be bought, because anyone qualified to give it is already rich. You can only get it from investors.
Format
Y Combinator has a novel approach to seed funding: we fund startups in batches. There are two each year, one in the summer in Cambridge, and one in the winter in Mountain View. During each cycle we fund multiple startups. We've funded a total of 102 so far.
Applying for funding is also different at Y Combinator. Instead of submitting a business plan or making a slide presentation, you just fill out an application form. We invite the most promising groups to meet us in person, and we make funding decisions immediately afterward.
Most of the founders in each startup we fund are expected to move to our location for at least three months: the Bay Area January through March for startups in the winter cycle, and Cambridge June through August for summer ones.
During those three months we host a dinner once a week at Y Combinator, and at each dinner we invite an expert in some aspect of startups to speak. Typically speakers include startup founders, venture capitalists, lawyers, accountants, journalists, investment bankers, and executives from big technology companies.
About ten weeks in, we host an investor day where all the startups can present to potential investors. Ten weeks turns out to be enough for most groups to create a convincing prototype. In fact, many launch in less than ten weeks.
Y Combinator is sometimes described as a boot camp, but this is not really accurate. We probably get called that because we fund a lot of startups at once, and most have to move to participate. But the similarities end there; the atmosphere is the opposite of regimented.
Funding startups in batches works better for everyone than the usual approach. It's more efficient for us, but also better for the startups, who probably end up helping one another at least as much as we help them.
Because we fund such large numbers of startups, Y Combinator has a huge "alumni" network, and there's a strong ethos of helping out fellow YC founders. So whatever your problem, whether you need beta testers, a place to stay in another city, advice about a browser bug, or a connection to a particular company, there's a good chance someone in the network can help you.
Philosophy
We think hackers are most productive when they can spend most of their time hacking. Our goal is to create an environment where you can focus exclusively on getting an initial version built. In any startup, the first couple months tend to be the most productive of all. Those first months define the company. So anything you can do to maximize their effects is probably a good idea.
We seem to have succeeded in creating a good environment, because many founders have told us that the first ten weeks of Y Combinator were the most productive period of their lives.
We try to interfere as little as possible in the startups we fund. We don't want board seats, rights to participate in future rounds, vetoes over strategic decisions, or any of the other powers investors sometimes require. We offer lots of advice, but we can't force anyone to take it. We realize that independence is one of the reasons people want to start startups in the first place. And frankly, it's also one of the reasons startups succeed. Investors who try to control the companies they fund often end up destroying them.
One concrete consequence is that Y Combinator funding lets you sell early, if you want to. It can sometimes make sense to sell yourself when you're small for a few million, rather than take more funding and roll the dice again. Google likes to do early-stage acquisitions, and we expect them to become increasingly common as other companies learn what Google has.
If you take a large amount of money from an investor, you usually give up this option. But we realize (having been there) that an early offer from an acquirer can be very tempting for a group of young hackers. So if you want to sell early, that's ok. We'd make more if you went for an IPO, but we're not going to force anyone to do anything they don't want to.
Why are we so flexible? Not (just) because we're nice people. We realize that, as it gets cheaper to start a company, the balance of power is shifting from investors to hackers. We think the way of the future is simply to offer hackers the best possible deal.
Our goal is to be the preferred source of seed funding, and to be that we have to do right by everyone. The good hackers all know one another, so if the groups we fund feel they're getting a bad deal, no one will want funding from us in the future. And later stage investors (especially VCs) also tend to know one another, so if the companies we seed end up being broken in any way, no one will want to invest in them in the future.
So far we seem to be on track, because both the startups we've funded and their next round of investors seem happy with us.
What We Do
Y Combinator does seed funding for startups. Seed funding is the earliest stage of venture funding. It pays your expenses while you're getting started.
Some companies may need no more than seed funding. Others will go through several rounds. There is no right answer; how much funding you need depends on the kind of company you start.
At Y Combinator, our goal is to get you through the first phase. This usually means: get you to the point where you've built something impressive enough to raise money on a larger scale. Then we introduce you to later stage investors—and in some cases even acquirers.
More Than Money
We make small investments (rarely more than $20,000) in return for small stakes in the companies we fund (usually 2-10%).
All venture investors supply some combination of money and help. In our case the money is by far the smaller component. In fact, many of the startups we fund don't need the money. We think of the money we invest as more like financial aid in college: it's so people who do need the money can pay their living expenses while Y Combinator is happening.
What happens at Y Combinator? The most important thing we do is work with startups on their ideas. We're hackers ourselves, and we've spent a lot of time figuring out how to make things people want. So we can usually see fairly quickly the direction in which a small idea should be expanded, or the point at which to begin attacking a large but vague one.
The questions at this stage range from apparently minor (what to call the company) to frighteningly ambitious (the long-term plan for world domination). Over the course of three months we usually manage to help founders come up with initial answers to all of them.
Though we fund all types of computer startups, we're especially interested in web-based applications. We've been thinking about that problem longer than anyone else, and by now can visualize much of the space of possibilities.
The second most important thing we do is help founders deal with investors and acquirers. Yes, we make introductions, but that part is easy. We spend much more time teaching founders how to pitch their startups, and how to close a deal once they've generated interest. In the second phase we supply not just advice but protection; people are more likely to treat you well if you come from YC, because how they treat you determines whether in the future we'll steer deals toward or away from them.
We also get the startups we fund incorporated properly with all the right paperwork, avoiding legal time-bombs that could kill them later. We introduce founders to lawyers who will often, because of the YC connection, agree to defer payment for legal work. We regularly help startups find and hire their first employees. We advise about what to patent, and when. One of the least publicized things we do, for obvious reasons, is mediate disputes between founders. No startup thinks they're going to need that, but most do at some point.
The kind of advice we give literally can't be bought, because anyone qualified to give it is already rich. You can only get it from investors.
Format
Y Combinator has a novel approach to seed funding: we fund startups in batches. There are two each year, one in the summer in Cambridge, and one in the winter in Mountain View. During each cycle we fund multiple startups. We've funded a total of 102 so far.
Applying for funding is also different at Y Combinator. Instead of submitting a business plan or making a slide presentation, you just fill out an application form. We invite the most promising groups to meet us in person, and we make funding decisions immediately afterward.
Most of the founders in each startup we fund are expected to move to our location for at least three months: the Bay Area January through March for startups in the winter cycle, and Cambridge June through August for summer ones.
During those three months we host a dinner once a week at Y Combinator, and at each dinner we invite an expert in some aspect of startups to speak. Typically speakers include startup founders, venture capitalists, lawyers, accountants, journalists, investment bankers, and executives from big technology companies.
About ten weeks in, we host an investor day where all the startups can present to potential investors. Ten weeks turns out to be enough for most groups to create a convincing prototype. In fact, many launch in less than ten weeks.
Y Combinator is sometimes described as a boot camp, but this is not really accurate. We probably get called that because we fund a lot of startups at once, and most have to move to participate. But the similarities end there; the atmosphere is the opposite of regimented.
Funding startups in batches works better for everyone than the usual approach. It's more efficient for us, but also better for the startups, who probably end up helping one another at least as much as we help them.
Because we fund such large numbers of startups, Y Combinator has a huge "alumni" network, and there's a strong ethos of helping out fellow YC founders. So whatever your problem, whether you need beta testers, a place to stay in another city, advice about a browser bug, or a connection to a particular company, there's a good chance someone in the network can help you.
Philosophy
We think hackers are most productive when they can spend most of their time hacking. Our goal is to create an environment where you can focus exclusively on getting an initial version built. In any startup, the first couple months tend to be the most productive of all. Those first months define the company. So anything you can do to maximize their effects is probably a good idea.
We seem to have succeeded in creating a good environment, because many founders have told us that the first ten weeks of Y Combinator were the most productive period of their lives.
We try to interfere as little as possible in the startups we fund. We don't want board seats, rights to participate in future rounds, vetoes over strategic decisions, or any of the other powers investors sometimes require. We offer lots of advice, but we can't force anyone to take it. We realize that independence is one of the reasons people want to start startups in the first place. And frankly, it's also one of the reasons startups succeed. Investors who try to control the companies they fund often end up destroying them.
One concrete consequence is that Y Combinator funding lets you sell early, if you want to. It can sometimes make sense to sell yourself when you're small for a few million, rather than take more funding and roll the dice again. Google likes to do early-stage acquisitions, and we expect them to become increasingly common as other companies learn what Google has.
If you take a large amount of money from an investor, you usually give up this option. But we realize (having been there) that an early offer from an acquirer can be very tempting for a group of young hackers. So if you want to sell early, that's ok. We'd make more if you went for an IPO, but we're not going to force anyone to do anything they don't want to.
Why are we so flexible? Not (just) because we're nice people. We realize that, as it gets cheaper to start a company, the balance of power is shifting from investors to hackers. We think the way of the future is simply to offer hackers the best possible deal.
Our goal is to be the preferred source of seed funding, and to be that we have to do right by everyone. The good hackers all know one another, so if the groups we fund feel they're getting a bad deal, no one will want funding from us in the future. And later stage investors (especially VCs) also tend to know one another, so if the companies we seed end up being broken in any way, no one will want to invest in them in the future.
So far we seem to be on track, because both the startups we've funded and their next round of investors seem happy with us.
What We Do
Y Combinator does seed funding for startups. Seed funding is the earliest stage of venture funding. It pays your expenses while you're getting started.
Some companies may need no more than seed funding. Others will go through several rounds. There is no right answer; how much funding you need depends on the kind of company you start.
At Y Combinator, our goal is to get you through the first phase. This usually means: get you to the point where you've built something impressive enough to raise money on a larger scale. Then we introduce you to later stage investors—and in some cases even acquirers.
More Than Money
We make small investments (rarely more than $20,000) in return for small stakes in the companies we fund (usually 2-10%).
All venture investors supply some combination of money and help. In our case the money is by far the smaller component. In fact, many of the startups we fund don't need the money. We think of the money we invest as more like financial aid in college: it's so people who do need the money can pay their living expenses while Y Combinator is happening.
What happens at Y Combinator? The most important thing we do is work with startups on their ideas. We're hackers ourselves, and we've spent a lot of time figuring out how to make things people want. So we can usually see fairly quickly the direction in which a small idea should be expanded, or the point at which to begin attacking a large but vague one.
The questions at this stage range from apparently minor (what to call the company) to frighteningly ambitious (the long-term plan for world domination). Over the course of three months we usually manage to help founders come up with initial answers to all of them.
Though we fund all types of computer startups, we're especially interested in web-based applications. We've been thinking about that problem longer than anyone else, and by now can visualize much of the space of possibilities.
The second most important thing we do is help founders deal with investors and acquirers. Yes, we make introductions, but that part is easy. We spend much more time teaching founders how to pitch their startups, and how to close a deal once they've generated interest. In the second phase we supply not just advice but protection; people are more likely to treat you well if you come from YC, because how they treat you determines whether in the future we'll steer deals toward or away from them.
We also get the startups we fund incorporated properly with all the right paperwork, avoiding legal time-bombs that could kill them later. We introduce founders to lawyers who will often, because of the YC connection, agree to defer payment for legal work. We regularly help startups find and hire their first employees. We advise about what to patent, and when. One of the least publicized things we do, for obvious reasons, is mediate disputes between founders. No startup thinks they're going to need that, but most do at some point.
The kind of advice we give literally can't be bought, because anyone qualified to give it is already rich. You can only get it from investors.
Format
Y Combinator has a novel approach to seed funding: we fund startups in batches. There are two each year, one in the summer in Cambridge, and one in the winter in Mountain View. During each cycle we fund multiple startups. We've funded a total of 102 so far.
Applying for funding is also different at Y Combinator. Instead of submitting a business plan or making a slide presentation, you just fill out an application form. We invite the most promising groups to meet us in person, and we make funding decisions immediately afterward.
Most of the founders in each startup we fund are expected to move to our location for at least three months: the Bay Area January through March for startups in the winter cycle, and Cambridge June through August for summer ones.
During those three months we host a dinner once a week at Y Combinator, and at each dinner we invite an expert in some aspect of startups to speak. Typically speakers include startup founders, venture capitalists, lawyers, accountants, journalists, investment bankers, and executives from big technology companies.
About ten weeks in, we host an investor day where all the startups can present to potential investors. Ten weeks turns out to be enough for most groups to create a convincing prototype. In fact, many launch in less than ten weeks.
Y Combinator is sometimes described as a boot camp, but this is not really accurate. We probably get called that because we fund a lot of startups at once, and most have to move to participate. But the similarities end there; the atmosphere is the opposite of regimented.
Funding startups in batches works better for everyone than the usual approach. It's more efficient for us, but also better for the startups, who probably end up helping one another at least as much as we help them.
Because we fund such large numbers of startups, Y Combinator has a huge "alumni" network, and there's a strong ethos of helping out fellow YC founders. So whatever your problem, whether you need beta testers, a place to stay in another city, advice about a browser bug, or a connection to a particular company, there's a good chance someone in the network can help you.
Philosophy
We think hackers are most productive when they can spend most of their time hacking. Our goal is to create an environment where you can focus exclusively on getting an initial version built. In any startup, the first couple months tend to be the most productive of all. Those first months define the company. So anything you can do to maximize their effects is probably a good idea.
We seem to have succeeded in creating a good environment, because many founders have told us that the first ten weeks of Y Combinator were the most productive period of their lives.
We try to interfere as little as possible in the startups we fund. We don't want board seats, rights to participate in future rounds, vetoes over strategic decisions, or any of the other powers investors sometimes require. We offer lots of advice, but we can't force anyone to take it. We realize that independence is one of the reasons people want to start startups in the first place. And frankly, it's also one of the reasons startups succeed. Investors who try to control the companies they fund often end up destroying them.
One concrete consequence is that Y Combinator funding lets you sell early, if you want to. It can sometimes make sense to sell yourself when you're small for a few million, rather than take more funding and roll the dice again. Google likes to do early-stage acquisitions, and we expect them to become increasingly common as other companies learn what Google has.
If you take a large amount of money from an investor, you usually give up this option. But we realize (having been there) that an early offer from an acquirer can be very tempting for a group of young hackers. So if you want to sell early, that's ok. We'd make more if you went for an IPO, but we're not going to force anyone to do anything they don't want to.
Why are we so flexible? Not (just) because we're nice people. We realize that, as it gets cheaper to start a company, the balance of power is shifting from investors to hackers. We think the way of the future is simply to offer hackers the best possible deal.
Our goal is to be the preferred source of seed funding, and to be that we have to do right by everyone. The good hackers all know one another, so if the groups we fund feel they're getting a bad deal, no one will want funding from us in the future. And later stage investors (especially VCs) also tend to know one another, so if the companies we seed end up being broken in any way, no one will want to invest in them in the future.
So far we seem to be on track, because both the startups we've funded and their next round of investors seem happy with us.
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