Ben Metcalfe is the founder of Monochrome Capital - a Silicon Valley-based venture capital firm that invests in early-stage software and AI-driven startups. Ben, a passionate technology geek, shares lessons from his unconventional but insightful career journey - from building websites in the mid-90s as a teenager, getting his first job as a software engineer at 18 without a college degree, and co-founding world-famous companies like WP Engine. Ben believes in enabling founders to fulfill their dreams regardless of their background, demographic, or location.
Ben Metcalfe is the founder of Monochrome Capital - a Silicon Valley-based venture capital firm that invests in early-stage software and AI-driven startups. Ben, a passionate technology geek, shares lessons from his unconventional but insightful career journey - from building websites in the mid-90s as a teenager, getting his first job as a software engineer at 18 without a college degree, and co-founding world-famous companies like WP Engine. Ben believes in enabling founders to fulfill their dreams regardless of their background, demographic, or location.
Highlights
[01:31] Self-taught BBC software engineer lands and shines in Silicon Valley
[6:47] Silicon Valley is still the heartbeat of technology, but opportunities to change the world through entrepreneurship are everywhere across the world.
[13:26] Thoughtfulness and genuine passion for solving the problem wins over investors who want to make long-term commitments to your company.
[17:52] There’s no standard checklist for the personality traits or qualities of a potentially successful founder.
Non-profit: Put Me In!
Ben Metcalfe: Sometimes founders are trying to use business lingo and jargon and can get caught, just be yourself. And if you're super passionate about what you're doing, it'll come through. And if you're not as passionate or you're sitting there thinking maybe I'm not that passionate, be thoughtful about it because here's the reality.
I'm going to give you a large amount of money and I'm expecting you to work on this for many, many, many years to come. And you can't fire me as an investor. In theory, you could walk away from your company if you don't want to do it anymore, but that's not going to be good for you. This really is a very long-term commitment.
Gopi Rangan: You are listening to the Sure Shot Entrepreneur.
A podcast for founders with ambitious ideas, venture capital investors, and other early believers tell you relatable, insightful, and authentic stories to help you realize your vision.
Welcome to the Sure Shot Entrepreneur. My guest today is Ben Metcalf. Ben is the founder of Monochrome capital. He invests in B2B software companies and he invested pre-seed stage where the technical challenges are huge.
Let's learn more about Monochrome and Ben's background and how he invests. Ben, welcome to the Sure Shot Entrepreneur.
Ben Metcalfe: Gopi, thank you so much for having me super honored to be invited to join you.
Gopi Rangan: Tell us about yourself, starting with your career. You were a software engineer. That was your first job.
Ben Metcalfe: That's right. I was one of these noxious kids that were programming in basic and C and C++ when I was, I don't know, 12, I think, and discovered the internet in the early nineties and started building websites in the mid-nineties as a teenager. And I launched my first startup in 98' when I was 17. The art of programming and being a developer and product manager has been with me since my sort of teens.
Gopi Rangan: How did you become a venture capital investor? You were a software engineer, and then you were a founder a couple of times, and then eventually became an investor.
Ben Metcalfe: Yeah, happy to join the dots. It's usually an unusual, unorthodox means most of us end up here. I didn't go to university. I don't have a college background. I have dyslexia and I have recently discovered ADHD.
Doing a lot of studying was not really my forte, despite learning programming as a child. I joined the BBC when I was 18 as a software engineer for the BBC news website. I built a bunch of stuff for the BBC, including the BBC's developer platform, which got me out to San Francisco a lot from London. I'm originally from London.
I moved to San Francisco in 2006, became the Director of the platform at Myspace when Myspace was a thing, and have them launch that platform for a year or so, worked on a bunch of other projects and other things in what we might call the web 2.0 community in San Francisco back in the day. And then in 2010, I co-founded a company called WP Engine with Jason Cohen which is a WordPress platform for business.
We've raised about $290 million. Now over many years, majority-owned by private equity at this point about 1500, 2000 employees these days. But so it's a lot about taking an idea and a market opportunity scaling it up technically, but also from a go-to-market perspective and hiring and all of that good stuff.
After that I went, Travis Kalanick, a friend of mine at the time, asked me to join his company called Uber, which I did. I became a product lead for an area of Uber for a couple of years and had a great time there, but decided really I'd been doing this for 20 years at that point. And I realized I was an older man now in a younger man's game.
Maybe looking around at my colleagues at Uber. And it felt the right time to move into venture. So I joined a firm here in San Francisco called rich ventures, which was previously IDG Ventures. I joined as a principal, but they let me lead some deals, had a great time. And I learned a lot at that fund for a couple of years before establishing Monochrome Capital.
Gopi Rangan: This is a fascinating journey. You're not even a dropout from college. You just didn't even go to college.
Ben Metcalfe: I never went.
Gopi Rangan: And you had a beautiful career in software engineering and multiple startups along the way. Eventually, you switched to the investing side of the world. How is Monochrome Capital different from other firms?
Ben Metcalfe: Monochrome Capital fund one, it's a new fund. We really only got going in the last quarter. We did the first close in April and at this point, it's just me, but having had a lot of experience and having a lot of privilege and luck to experience a lot of growth and opportunity in companies that I've built and being involved in it gives me an opportunity to spend more time with founders.
And that's why I particularly like investing in founders who perhaps are technical founders or founders who come from a technical background and need help with go-to-market, with hiring. Just kind of the art of the start. I really love partnering with the founders that I invest in. And actually, a lot of VCs say, we'll do hands-on or we'll do something value-add.
I genuinely do love this. This is my passion. It's what I do for a living is building companies and I love spending time with founders to help them do that. I always take the Goldilocks approach, not too hot, not too cold, somewhere in the middle. I don't want to run their businesses by any means, but I'm not the type of investor that says, send me a quarterly update.
Let me know when you sell the business and send me the check. Good luck. That's not really my approach. My approach is to be helpful and do whatever I can for the founders that I have the privilege and honor of investing in.
Gopi Rangan: What kind of companies do you invest in? I understand that you invest at pre-seed seed stage in B2B startups.
What are areas that you focus on?
Ben Metcalfe: The way I kind of pitch it is I'm interested in companies that have a high degree of technology, either in their approach or their market. The market would be cloud infrastructure, cyber security, machine learning platforms, data processing, stuff that just is particularly technical in terms of building anything successfully in that realm.
And also thinking about how you go-to-market and sell that to customers. The other axis I think about is the verticalization or the applied aspects of that. Taking something reasonably technical and perhaps disrupting an existing business market. An example would be Allocate, which is Samir Kaji's new company that connects capital family offices, et cetera, with emerging managers.
He has a great network and experience of first Republic and Silicon valley bank doing this, but wants to build a technical platform a bit like Carter or something like that to solve this friction in this market, he's not technical, but what he's building is a technical implementation. And so helping him and his team thinks about how to do that and successfully is the other axis of where I invest.
Gopi Rangan: Is there a geographical focus for your investments? Do you invest in Silicon Valley or elsewhere in the US or other parts of the world?
Ben Metcalfe: I'm in San Francisco. I'm a firm believer despite the changes we've had in the world, that being here in the San Francisco Bay area is very important.
This is still a pinnacle of where so much of this technology is being built. But no, I invest across North America, Europe, Israel. I have had investments that have at the ridge that have had a principal involvement in Kenya and Uganda. And I'm a big fan of what's going on in Africa. I would love to start making investments there in due course, but I'm not quite ready for fund one to do that.
But right now, the the core areas are North America, Europe, and Isreal.
Gopi Rangan: I understand the high-level details of the firm, what does B2B means for you, and the kind of specific examples that you gave, like Allocate and your geographical focus. Now, I want to go to a little more detail about what the firm is about and how you make investments.
What's really exciting for you? Why do you want to work with founders?
Ben Metcalfe: Founders changing the world, which is a very overused and cliche term, but what it means is they have the ability to do that. I grew up in a not particularly privileged background, my parents were social workers. They were not people of means by any straight of thought of the imagination.
And yet I was able to learn to build websites. I was able to join the BBC at 18 and work on the BBC news website shortly afterward September the 11th happened. You look at the importance of news. I could have this big impact from just this ability that I had to be a programmer and a product manager.
Once you put people in an environment that's much more sympathetic to entrepreneur-ism people with the same kind of talents are able to have such a huge impact on the world and it may well be that they're still building B2B software, which is not going to change the world necessarily and in a life or death sense, but you're still making that dent, you're still doing something. It outpaces or outsizes you as an individual, it's having that outsized impact. There's something really exciting about that. And I also just love tech. I'm a geek. I love thinking about the new technologies and what's being built. We're getting much more into blockchain these days and other bits and pieces because it's obviously the next or the next frontier.
I just love getting into stuff, understanding it, looking around the corner, seeing the opportunities once you've done that, the next logical progression is building something to have an impact and being able to enable the next generation of entrepreneurs with the experience that I've had to help them be successful.
It's just really meaningful to me.
Gopi Rangan: I see that you've had a great journey starting with humble beginnings. And you started companies as well. You are a founder at Swordfish and you are the co-founder of WP Engine. How is fundraising different today compared to the times when you were fundraising in 2007, 8, 9, 10, 11, 12? Around that time, compared to where we are today in 2021.
Ben Metcalfe: Yeah, it's not on my LinkedIn. I'm happy to chat a little bit about it here, but actually, I just founded a new company as well in the blockchain space. It's a blockchain developer platform. We're pretty stealth at the moment. So not giving too much away, unfortunately now, but it's a company that I'm incubating within the VC firm, but with a couple of folks that I worked with at Uber and some other people out of Google, we've actually just gone through a raise.
We just raised a seed round. And I can tell you that it's very different now than it was even two or three years ago. The whole process, we raised $4 million and we did that in about two and a half weeks, and it really came down to firms wanting to talk to us pretty quickly, getting the right people in front of us very quickly.
The idea of partners and associates and associates looking at a deal and screening you. And then there's a week before then the partner then talks to you and then they have to go to a committee. Things are moving so quickly now for the right deals, that if they don't have that time. And it was interesting to see the firms that immediately said, let's get you in front of partners now today, tomorrow, and made multi-million dollar decisions within one or two meetings versus a number of funds that took two or three weeks and by the time they even wanted to get to talk to a partner, we'd already made most of the commitment of our round. That's changed a lot. And the amount that you need to have built at this point is a lot. The bar is a lot lower than it was with WP Engine. With WP Engine, we were doing a million dollars in revenue in the first year, and we barely raised any money at all and needed to get that to be a proof point.
Whereas today, If you can articulate a market opportunity and you can explain why you as a founding team have that unfair advantage that some other smart people who have also come up with that idea are going to be less successful or unsuccessful compared to you. If you can do that and you can get the right people to listen, things seem to be moving very quickly. It's about having that story, having a plan, knowing who to talk to, which firms, and getting folks to then introduce you to other firms. But you can move very, very quickly and raise a lot more money than any time that I've ever been on either side of the table.
Gopi Rangan: Yeah, the market is very different compared to a few years ago, there are many more investors and they are able to make faster decisions. As a founder, did you have to change anything in your mindset and how you're thinking about investments? How is being a founder helpful to you now that you're an investor?
Ben Metcalfe: Yeah, I've learned a lot as an investor and a founder from this ground, I've learned that really the deal flow between folks, who sends who a deal, who advocates for that deal. And then how quickly a decision is made because it's such a warm introduction. That's always been the case, but it's so clear or it's, even more, the case now than it's ever been.
We definitely saw that firsthand. Once the first round of folks we went to with this opportunity, started introducing us to more people the flywheel turned very quickly. I'm very thoughtful if you take a step away from that, that insider in-network or getting to the right people and then growing that interest is a privilege.
And that is difficult for people who maybe are on the outside or maybe are raising for the first time, or maybe come from a background or geographically placed where they wouldn't have access to that it's changing and there are ways around it. But I'm thoughtful to the fact that it's definitely difficult to penetrate and get that first foot in the door.
But once you do get a few people interested in you to want to take an interest, my advice to founders is to get that person to advocate for you to other people in their network, and then use that as your springboard to get that network, which maybe you wouldn't otherwise have had at the moment when you started raising.
Gopi Rangan: Now like you, I also invest in scary early stages pre-seed and seed stages often. I'm the champion for the startup advocating for them in various avenues at conferences when I speak and when I talk to other investors, I can relate to the experiences that you're sharing. I want to go a little deeper into the conversations that you have with founders.
What do you ask them when you first meet them? What are you looking for and what really gets you excited?
Ben Metcalfe: I asked him a couple of things. I always like to understand why somebody wants to build this business. Often you look people in the eyes, whether it be in person or over a zoom window these days, and you can see that this is their life's work, that they are incredibly passionate about solving a problem or righting a wrong, or just some interesting challenge that they have themselves, that they now want to scratch that itch.
I also meet people and you can see that they're not that interested really in doing it. The word that sometimes comes up is play, or I'm doing a play in the data space. And it just means they're being opportunistic. I don't like making those investments and indeed I don't make those investments. When I can see that somebody is really passionate about something they're waking up in the morning, thinking about it.
They're in the shower, thinking about it, whatever it might be. I love that because, and it's not just for the capitalistic, oh, they're going to make a great return because they're working so hard. It's me enabling somebody to fulfill their passion. And the other question I ask people is what is your unfair advantage?
Because no idea is really new. And if you've got an idea, there are five other people out there that probably have the same idea. What gives you the reason to be successful? Those other people who are super smart, like you, may not have that degree of success and people give me different answers. And sometimes it's a challenging question if they haven't prepared, but it's great to see how people answer that.
Gopi Rangan: Yeah, when people say this is a play or some play to me, it gives the feeling of there's some arbitrage opportunity here that's short term, let's go capture that. It doesn't give the feeling of I'm building this because this is going to last for a long time. This is going to turn into a huge phenomenon that could even go worldwide.
I don't get that feeling when the nomenclature and the phrases people use often indicate what they're really building.
Ben Metcalfe: Yeah. If you're a founder listening to this, and you're really passionate about your business, don't say that sometimes founders are trying to use business lingo and jargon and can get caught.
Just be yourself. If you're super passionate about what you're doing, it'll come through. And if you're not as passionate or you're sitting there thinking maybe I'm not that passionate, be thoughtful about it because here's the reality. I'm going to give you a large amount of money, and I'm expecting you to work on this for many, many, many years to come.
And you can't fire me as an investor. In theory, you could walk away from your company if you don't want to do it anymore, but that's not going to be good for you. This really is a very long-term commitment. The majority of startups fail as we know, and even the ones that are successful, and hopefully they're the ones that we're investing in could take 10, 15 years to exit.
Hopefully not that long, but they could take a long time before they either are successful or indeed they peter out. And you really need to be clear, not only with the investor but with yourself. That you're actually down for that. You see folks now the average age of being in a job is 18 months. These days are I read recently, this is not an 18-month career move.
This is a multi-year commitment. And again, I really liked it particularly with first-time founders looked them in the eye and be clear that they're really down for that commitment.
Gopi Rangan: Yeah, this is indeed a long-term journey. And I often say that the relationship with the investor goes beyond that one company.
Sometimes these companies don't work out when you come back and start another company, it's the same investors that you want to work with. It's a very important relationship between the investor and the entrepreneur. How many investments do you make in a year on average?
Ben Metcalfe: The fund is expected to do about 24 or 25 investments over the next two years.
But I want to do about three every quarter, maybe one a month. That gives me the ability to spend time with each of those investments and make sure I'm able to give them the bandwidth that they need. Obviously, there are lots of people out there who make lots of small investments and they're just doing two a week or something like that is absolutely crazy.
I don't know how they are able to spend any time with any of these investments. There's nothing wrong with that it's a different philosophy. I'm trying to pace myself and make sure that I'm investing in a way that I can spend the time with those people that I invest in.
Gopi Rangan: What qualities are you looking for in entrepreneurs? You make about two to three investments per quarter.
Are there certain types of qualities you like to find in these entrepreneurs, so you can form that conviction very quickly? Are there any personality traits or any examples from their past that you look for that give you a signal that this is a kind of company? These are the kinds of founders I want to invest in.
Ben Metcalfe: I've thought a lot about this, and I'm really glad you asked me this question because I've tried to be quite reductive about this and think about of all the companies that I've invested in or been involved in when I was at the bigger firm, what is the single common thread of all of them, or at least all of the successful ones.
And there isn't really one. I don't care what your background is. I don't care about where you went to school or indeed if you went to school at all. I don't particularly care where you're based. I definitely want to understand, if you need to have some reason why this particular problem that you're solving, you're the right person.
If you want to put satellites up in space and do something interesting with satellite technology, hopefully, you have some connection with the satellite or space industry somewhere, because if you've only ever done social networking product development, you might ask, well, why are you able to do this or be successful?
But yeah, other than that, the only one, and I know this is strange. The only one is everyone I can think of that I've ever invested in of all of the entrepreneurs that I know are successful. People are typically very smart and engaged with what they're doing. But other than that, I don't think there is a lot of commonalities.
Successful entrepreneurs look like all sorts of different people. It's really important as investors that we're thoughtful of that. And we're not putting biases, whether they be conscious or unconscious into thinking that an entrepreneur needs to look a particular way or have a particular background or speak in a particular way.
It's just not how I approach my investment. And I don't think it's how other people should either.
Gopi Rangan: That's beautifully articulated. There is no preset way. There is no template or a formula. You don't have preconceived notions of, these are qualities that I look for, and these are qualities that make an entrepreneur successful.
They can come from any background. They may have gone to a college, not gone to a college at all. Those things don't really matter to you.
Ben Metcalfe: Of the founders that I've backed. I don't even think I could tell you where they even went to university, assuming they even did. I have no idea. And that's not to say that an education isn't important.
If you have the opportunity to have an education and it's right for you, then go and do that. And I want my son to have a good education, but I don't think it's a requirement. As I said, spending time with people, knowing what they're about, what motivates them, their integrity. Far more important to me than what they look like or where they've been or where they're from or whatever.
Gopi Rangan: Can you give an example of a startup that you met either at Monochrome or previously? What did you talk about in the first one or two meetings? What questions did you ask them? What was the interaction like?
Ben Metcalfe: Definitely wanting to understand why they want to build this business. Why they're the right fit for this business.
I was at South by Southwest and I was in the line for a coffee somewhere. Somebody in front of me started chatting with me and he pitched me this startup that he was doing. And this was in 2007, 2008. It was fascinating. And by the time we got to the front of the line, I bought him the coffee and we chatted a bit more.
I ended up being an advisor. I don't think I had any money at the time to be in investing, but just from a coffee meeting or being in the line of a coffee that came out and that company ended up exiting and being sold to constant contact and actually made a great return for everyone involved. I can also think of times when I've had a 30-minute call with somebody and just getting into really haven't even gone through the business.
I always like to read the deck ahead of time. If I look through the deck and it's not the right type of business, I'm not going to take the time and waste anyone's time. But I knew that this was a company I was interested in, and we only had a half-hour call and I ended up just chatting with them about their background, about why they were interested in this particular problem space, but we never even talked about the business and they revealed a lot more about why this was important to them and the team they had and why they'd picked certain people.
And through that, I got to know that they were smart, hardworking, that they had integrity. There were some things that were shared that showed that things hadn't been easy for them and they hadn't given up. And that first meeting, we didn't even get into the market opportunity or how they were going to sell their products or who the next hires were or any of the usual stuff like that.
It was just getting inside their head and understanding what they were seeing and why they were wanting to do this business and really created a lot of rapport and empathy with the work that they were doing.
Gopi Rangan: You look for that personal connection with the founders and then comes the other details about market sizing and unit economics and all the other things.
The first step of the way is to connect with you at a human level. And when that happens, then the rest of the congregation has an opportunity.
Ben Metcalfe: Yeah, that's in an ideal world that doesn't happen every time. And I wouldn't want an entrepreneur to leave this interview and think they've got to do that every time, because they may not have the opportunity.
Different firms end up working different ways. But I do think that building that rapport on both sides, because at the end of the day, if you're an entrepreneur, you're doing the investor a favor by giving them an opportunity to invest in you, we're paid to do this. You've got to build up the rapport on both sides.
They've got to build up the rapport with you as the investor, talking to you as the entrepreneur, but that is really important, whether it happens initially. Whether it's in the second meeting. If you're back in the physical world and being able to take coffee meetings or lunches with investors, just finding out about them as well and them finding out about you is super important.
Gopi Rangan: You've been in Silicon Valley for more than 15 years, you've been a founder, a venture capital investor. You have seen the market evolve. If you were to change one thing about venture capital, what would you change?
Ben Metcalfe: One of the things I would change, which is changing, is the geographic element.
I sacrificed a lot to move from London to San Francisco, 15 years ago. I had to do that because I felt that being in London, wasn't going to get me the opportunity to build the startups that I wanted to build. And even now it's better than it was, but it's still not great raising money in Britain and in London is still tricky.
That's what many people come into San Francisco to do tours or fundraising. And that's why it's great to be here. If you've ever been to San Francisco, it's a beautiful part of the world. It's a beautiful part of America. I quite like living here now, but the fact that I could potentially invest in somebody in a different part of America.
WP Engine is based out of Austin. At the time, Austin was not quite the tech ecosystem for startups that it is now, but I went to Columbus Ohio a few months before all of the lockdowns to visit a company and saw all of the stuff that was going on there. And they've got a great ecosystem. The fact that the capital is now flowing a lot more freely because of the zoom world and in the pandemic is a great thing. If we can continue to break down those geographic barriers and capital can flow more freely into where there are ideas and innovation. That's wonderful for everyone from the founders, investors, LPs, and even the customers and users of these new companies. So I'd like to see that. The challenge now is still, the opportunities are not equal.
It's still difficult for me to justify making an investment in Africa, for example, or parts of flat AM, because the exits aren't there. We need to support those ecosystems as well. So that then capital can truly freely be placed where people have the best ideas working the hardest, regardless of not only geographic borders, but international borders as well.
And not just where you are in America or Europe, but where you are globally. I know that's a lofty answer, but there's so much privilege and so much gatekeeping around geography in entrepreneur-ism and adventure, which enables it that we need to continue the work that has already happened during the pandemic to break a lot of this down.
Gopi Rangan: Yeah, the barriers of geographical constraints are breaking and we're beginning to experience that already. It's no longer necessary for entrepreneurs to have to be in Silicon Valley. There are still some advantages, but if entrepreneurs are in their ecosystem where they are supported well, they have a better chance of building a greater, bigger business, more successful business.
We hope to see more of that in the future. I want to switch to the next part of our conversation and ask you about your community activity. Is there a nonprofit organization you are passionate about? Which one?
Ben Metcalfe: Absolutely. My wife and I are very honored to be able to support a nonprofit organization called Put me in, Putmein.org. Put me in, provides children with incarcerated parents, sporting equipment, and more recently travel bursaries as well so that they're able to focus their energies on sports activities.
It was founded by a friend of mine, Matt Blodgett, who actually was a managing director at Vector Capital and also was at North Bridge previously as well, but he himself was a child of an incarcerated father and the ability to be a college athlete. He was an American football player and got a scholarship to Yale is basically what enabled him to get the track that he ultimately had out of some difficulties early on in life into becoming a very successful investor and a wonderful human being.
I'm not a particularly sporty person, but it's been interesting to see the comments from children who say I have a lot of anger. I have had a lot of difficulties in my life. And when I play sport, when I kick the ball, when I hit the bat, that anger goes away and I'm able to focus. And many of those kids are now doing sport at a state level or a national level. It's enabled them to really see something, some success. And so Put me in also provides the travel opportunity for those kids to be able to travel to the meets, et cetera. My wife and I are very humbled to be able to support a great organization that's pretty new but doing some really amazing work.
Gopi Rangan: Ben, thank you very much for sharing that. And thanks a lot for sharing authentic stories, including your current company that you are co-founding and still in stealth mode. You were able to share some highlights on your career and what you've done in the past. Thank you so much for sharing insightful nuggets of wisdom. I look forward to sharing your wisdom with the world.
Ben Metcalfe: Gopi thank you so much for the time, really appreciate it.
Gopi Rangan: Thank you for listening to The Sure Shot Entrepreneur. I hope you enjoyed listening to real-life stories about early believers, supporting ambitious entrepreneurs.
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