Welcome to issue #59 of next big thing.
We started Footwork four years ago, and have written annual posts about the journey: at inception, year 1, year 2, year 3, and now this one to mark year 4.
A few highlights from this past year:
As in year 3, we once again made 4 new investments, including Elicit, GPTZero and a few not yet announced, taking our total portfolio to 17 active companies. We partnered with 8 of these companies as their Seed lead, 8 at the Series A, and 1 at the growth stage. Our initial check sizes have ranged from $1.25 to $10 million. Each of these investments is a true commitment for us.
We saw more high quality potential investments than in any other year. We believe this was a function of a) our efforts on sourcing, aided by more talented founders telling one another about Footwork, and b) AI as a “why now” driving exciting fundamentals in so many businesses, led by high-functioning teams. Most of the investments we made in year 4 were in teams we’d gotten to know for months or years, where we built a relationship of trust and mutual excitement to work together, having followed each other’s game films.
We found ourselves going deep in areas such as consumer and enterprise AI, vertical software infused with AI (particularly in legacy verticals like healthcare, life sciences, financial services, professional services, real estate), the consumerization of healthcare, and the retooling of the C-Suite (CMO, CFO, COO), particularly in consumer businesses, with AI.
The Footwork portfolio had a terrific year. The median growth rate in annualized revenue was 250%, and the average growth rate, buoyed by several outliers, was close to 500%. More than 1/3 of our portfolio companies now sit above $10M in annualized revenue.
Beyond the metrics, we’re impressed by the growth of the founders we work with as leaders, and by the teams they are building. Most of our portfolio founders participated in a six-month group executive coaching program that we sponsored. Our group chats feel more active than ever, with founders helping one another in business building. The Footwork community rose to the next level of density and quality over the past year.
We once again spent a lot of quality time together in-person, over dinners and board meetings, and at our office in San Francisco. The highlight of the year was our mini-summit, with an extraordinary group of founders as guests, including Jensen Huang of NVIDIA, Emery Wells of Frame.io, and Jack Altman of Lattice. They did not just show up to speak; Jensen, for example, spent more than two hours meeting our founders to try to better understand what they’re working on.
Jensen Huang, co-founder and CEO at NVIDIA, with Footwork’s founders and LPs in May 2024.
We would be remiss if we did not thank our limited partners this year. They represent causes that we are very proud to support, particularly right now, when several face challenges to their charters from the federal government, and uncertainty based on broader market volatility. While we still have a few investments to make in Footwork Fund I, we closed Fund II swiftly and smoothly in February. Our LPs have enabled us to pursue our life’s work for the next decade and beyond: a small group of equal partners, leading a handful of early-stage investments every year, and partnering closely with those founders as they turn their dreams into everlasting companies. It is a huge privilege to wake up every day to work on Footwork.
I started next big thing to share unfiltered thoughts. I’d love your feedback, questions, and comments!
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Congratulations on Year 4!
yay