Dave McClure


500 startups founding partner, Dave McClure, is known for his unfiltered opinions and a diverse portfolio of investments that include Twilio, Credit Karma, MakerBot and Wildfire Interactive. McClure started working at PayPal in 2001, doing technology evangelism and education—geek marketing, as he calls it. He’s witnessed Silicon Valley’s rises and falls from the inside for over two decades. Today, he’s not worried about the threat of the putative tech bubble; he’s concerned about the country’s leadership. We sat down with McClure a week after the election and that viral video from Web Summit’s tech conference stage, where he asked the crowd: “If you’re not f—— pissed right now, what is wrong with you?”

What drives you and how is your approach different from other seed accelerators?

A lot of initial inspiration came from folks like Y Combinator, Techstars and First Round Capital. We kind of added our own angle to that. We’ve been investing globally—that’s one of the big things. Our focus is on underdogs… Christine (Tsai) and I wanted to create opportunities for folks who weren’t always white, male, and went to Stanford or MIT.

Are there any standout cases where you bet on an underdog that made it to the head of the pack?

I wrote a small check for Slideshare—a company that was run by a husband, wife and brother team. A lot of people weren’t sure about a family structure for a startup. They eventually raised $3 million—that was all they needed. They sold to LinkedIn for $119 Million. It was a pretty good outcome and efficient use of capital. They were underdogs because they didn’t have the typical founder profile.

Marketing can be overlooked in tech, how did you realize that was valuable?

I was very distrustful of marketing and salespeople too. But realized later in life that this is sort of important… I started doing angel investing. I didn’t know too much about what I was doing, but I knew a bit about tech and a bit about marketing… Then I tried to raise funds in 2008, it wasn’t such a good time for that, but eventually in 2010 my partner, Christine Tsai, who’d been at Google and YouTube, and I got started. Our first fund was $30 million dollars… We’ve grown from about five people to one hundred and fifty people and along the way invested in a lot of companies.

There’s been talk of a tech bubble for over a year now. Do you see cause for concern?

I’m not concerned… there may have been people pricing unicorns or later stage companies at very high valuations for a period of time between 2013 and 2015. But I think that’s quieted down this year. I think there’s substantial capital being deployed in the market. I think there are great companies being put together. I generally think we’re getting better at the business of building startups.

What are the most powerful ways tech is changing the Bay Area; is it unfair to criticize tech for focusing on problems like faster food delivery?

I think sometimes we’re solving very high-class problems. But there are also a lot of business productivity solutions… People may not look at on-demand food delivery as saving the world, but at the same time that’s making things easier for people. It’s not a bad thing.

Which projects are you excited about at the moment?

Some of my founders are working on Debug Politics—a hackathon organized by our founders, (500 Startups Alumni) Jesse Pickard of Elevate and Andrew Maguire of Looksharp. Several hundred people are getting together to solve problems in politics… That may be a result of a lack of attention from a week ago, but whatever the reason they’re going after that right now.

How has the election affected interest in politics in the tech community?

I think people are waking up. I wish it happened before last week… Hopefully now people will be involved personally—either putting money in, creating solutions or even running for office. Maybe last week was a wake up call for people. That’s one of the positives I’m trying to take from that situation.


Text Valerie Demicheva