Now we’re expanding, with a new program called Character Labs, designed to help pre-seed founders accelerate progress toward product-market fit. Here’s why.

Timing is everything

As a seed fund, we invest at a specific moment in the life of a startup: After the team has created an early version of the product, when customers are excited and ready to start using it (and hopefully pay for it!), but before the business is validated and ready to scale with more capital. I think of this as “version 0.9” of a startup.

However, our best founder relationships start much earlier, and give us a chance to get to know each other before we reach that specific investable moment and kick off a partnership that could last 10 years or more. In other words, closer to version 0.1.

What’s the best way to build that relationship? The default is a Zoom call and a promise to keep in touch. But I don’t think this is good enough — for us, or for the founder.

Before we invest, I want to show founders what it’s like to work with us. Not just that we can ask good questions on a call, but that we have something unique and valuable to offer. In return, I want to see a founder in action: How do they work with their team? How do they address the big risks in their business?

Most importantly, I want to establish the kind of trust and rapport that can only come from doing real work together.

If there was an obvious better way to build founder-investor relationships from the earliest days of a startup, everyone would do it. The challenge is a classic conflict of depth vs breadth: You can spend a lot of time with one founder, or a little time with lots of founders.

But we think we’ve found a way to avoid this conflict and have the best of both worlds.

Scaling the Design Sprint

A few years ago, Jake began working with Harvard and MIT as a guest instructor. Each January, he leads a group of student founders through a sprint program to help them explore and validate startup ideas. Each group contains 10 founding teams, so the normal approach we take with startups — one team, one sprint at a time — wouldn’t work. Jake had to retool his facilitation approach and figure out how to lead multiple sprints in parallel.

Inspired by Jake’s parallel sprints, I got to thinking: What if we took this approach with pre-seed startups? Next time we meet a promising startup that’s too early for us to invest in, what if we didn’t say “nice to meet you let’s keep in touch” but instead: Join a group of other founders at a similar stage and come sprint with us.

This could be the key to building founder relationships earlier. We could avoid the tradeoffs of depth vs breadth and spend more time with more founders, earlier in the process of building a startup.

We decided to give it a try.

Prototyping and testing Character Labs

As we do with every high-stakes project, we ran our own sprints to figure out how this pre-seed sprint program should work. We ran a Foundation Sprint, an Opportunity Sprint, and a Name Sprint. We sketched different forms of the program and decided which one would be most likely to help us reach our goals.

And we prototyped it, with a live pilot of Character Labs last summer. We recruited founders via existing relationships and communities like Xoogler. We shared a simple Notion landing page and asked founders to apply. We were hoping to find five great startups, but ended up accepting eight. We invested $100k in each startup and ran four weeks of back-to-back sprints with the founding teams.

We got great feedback from founders, who called it “transformational,” full of “gold nuggets of insight,” and a “running start” for their business.

Every team dramatically improved their product-market fit confidence score (yeah, we tracked it!) after repeatedly prototyping and testing with customers.

Fundraising was not our focus (there are plenty of great programs helping founders with that), but six of the eight startups have successfully raised money outside of the Character Labs investment.

In short, the pilot of Character Labs worked really well — even better than we hoped. So, following our successful test, we’re ready to commit and launch it for real.

Announcing Character Labs

Today I’m super excited to announce Character Labs, our new sprint program for pre-seed founders! You can read more and apply on our website, but here’s the gist:

Every company in Character Labs works directly with our team in a sequence of back-to-back sprints that are 100% focused on finding product-market fit.

In these sprints, you quickly test hypotheses and validate your product and GTM strategy. You leave the program with realistic prototypes and a detailed “scorecard” of risks. And you find out whether you’re on the right track in four weeks — not four months or more.

Character Labs combines everything we’ve learned from working with 250+ startups. It expands on the proven method from our book Sprint with dozens of new exercises and techniques that we haven’t shared publicly.

And on a personal level, I’m enthusiastic about Character Labs because the program allows me to extend my personal mission to a whole new category of founders.

The work that matters most to pre-seed founders

When we launched Character, I wrote:

My personal mission is helping people make time for work that matters. By supporting founders, I help create meaningful products and businesses that in turn create meaningful change for their customers. By investing capital along with my time, I can amplify founders’ ability to spend time on this work.

I think that’s why I’ve always found these too-early-to-invest conversations (“let’s keep in touch”) so dissatisfying: I know what matters to these founders. I want to help. But before, I didn’t know how to support them in a way that worked in the context of our goals and constraints for the fund.

Now I do. With Character Labs, we can help founders focus on the most important work — building the right product for the right people — at the earliest stages of a startup.

We are still seed investors at the core. This program is an extension of our strategy, not a pivot. And we’ll continue to invest most of our fund dollars into startups at that “version 0.9” stage. But I think Character Labs makes us better seed investors, by showing us how teams work up close, and allowing us to continue to build pattern recognition for what works and what doesn’t at the early stages.

Most importantly, it gives us a way to engage wholeheartedly with pre-seed founders, and to build authentic relationships from the very beginning. When we invest, we partner with founders for a long time: five, seven, 10 years, or more. This relationship matters, and we want to get it right.

And I can’t think of a better way to begin than by working together, hand-in-hand, on the challenges that matter most to you. I hope you’ll join us.

In 2019, I wrote about how I use a calendar template to balance my schedule and make sure I’m spending time on the things that matter.

The basic idea of a calendar template is simple: Create a repeating schedule of calendar blocks that contain all the elements of a good day. When you start with a template, you don’t need to exercise willpower in the hour-by-hour decisions about what to do. In the words of Annie Dillard, a calendar template acts as scaffolding for your life, freeing you to “stand and labor with both hands at sections of time.”

I still use a calendar template—it’s one of my most valuable tactics for making time—but a lot has happened since I first wrote about this idea three years ago!

Evolving my calendar template

First, the Covid pandemic made my calendar template even more valuable. During lockdowns and the initial WFH period, my template gave structure to days that were unstructured and full of stressful distractions. And as I began to resume work and play IRL, my template evolved, helping me maintain the rebalanced priorities and norms I wanted to continue.

Then in 2021, I launched Character, my new venture capital fund. My schedule changed—I still needed time for deep work (writing, design sprints, etc), but now I have a lot more meetings and emails. My template evolved again.

But there was a problem: With more meetings, there were more people who could affect my calendar. I began spending more and more time managing my calendar. My calendar template was now more like a rough sketch than a template.

Around this time, I learned about Reclaim. (Founder Patrick Lightbody actually emailed me about it in response to a Covid-themed newsletter about templates as scaffolding! Full circle!)

Reclaim, which is now a Character portfolio company, is a smart calendar assistant that dynamically schedules habits, tasks, and meetings, and makes adjustments when things change.

In other words, Reclaim automates my calendar template. I love the product and consider it an essential part of my daily tool stack. Reclaim helps me focus on what matters, and it saves me tons of admin time (scheduling, rescheduling, etc).

And with the beta launch of Reclaim scheduling links a few weeks ago, I realized I could get pretty close to giving Reclaim complete control of my calendar. So, a few weeks ago, I had my first “all-Reclaim week” and it went really well.

I thought this was a good opportunity to share how I use Reclaim to automate my calendar template and help make every day a good day.

(This post reads like an ad, but it’s not an ad, although my VC fund Character is an investor in Reclaim, so I’m biased 😌)

How I use Reclaim to automate my calendar template, step by step

Step 1. Build a foundation

I started by getting all of my calendars in one place using Reclaim’s Calendar Sync. If you have multiple calendars (work, personal, family, etc), it’s essential to see everything together before you can begin to design your days.

Next, I set my Working and Meeting Hours in Reclaim. This is the most direct representation of my calendar template, giving me the ability to define when I want to work and when I want to meet.

Step 2: Create structure with habits and tasks

Now it starts to get interesting. I set up a handful of Reclaim Habits to ensure I make time for the most important building blocks of every day.

If I schedule a meeting at 12:30, Reclaim moves lunch to 11:30 so I still have time to eat. When my afternoon starts to fill up, Reclaim automatically schedules a 15–30-minute afternoon break. For some reason, I seem to organically have fewer meetings on Thursday afternoons 🤷‍♂️, so I specified a “Soft Hold” with low defensiveness that Reclaim schedules if things are looking light.

Not every habit is managed by Reclaim. I have four workouts a week, plus a weekly review and lunch with Eli on Fridays, that always happen at the same time—those are just regular repeating events in my calendar.

Finally, I tell Reclaim which Tasks I need to get done and how long they’ll take to complete. Reclaim takes over from there, scheduling these tasks within my Working Hours and around my Habits and meetings.

For long-standing Time Dorks readers (hello 🤓), this level of detail—narrowing defining tasks and estimating duration—may sound like the sort of overly-precise productivity optimization I hate.

And it is. The truth is, I rarely use Reclaim Tasks. Normally, I schedule my projects (like writing blog posts) manually and try to build in a certain amount of slack.

But some weeks, I simply have lots of small tasks to complete—Reclaim shines in those scenarios, and helps me avoid the schedule paralysis that can sometimes accompany “busy” weeks.

So far, all of the above is relatively straightforward—Habits and Tasks are solo events, and repeating events certainly don’t require Reclaim.

A smart software assistant that dynamically adjusts my calendar is super handy, but the real Reclaim magic didn’t start until I began using it for meetings.

Step 3. Get smart about meetings

Late last year, Reclaim launched Smart 1:1s, a mind-blowing feature that automatically schedules recurring 1:1 meetings on a frequency you define. Reclaim looks at both participants’ calendars, finds available time within their Meeting Hours, holds the slot, then locks it in as the time approaches or the day gets busy.

A few months ago, they added the ability to create a Smart 1:1 with any person—not just Reclaim users—as long as you have the ability to see free/busy status on their calendar.

Character is very small (only two of us full-time!) so I don’t have a lot of internal meetings, but Smart 1:1 is still a tremendously useful feature. And on bigger teams with lots of internal 1:1s, it’s a game-changer.

From here, we can imagine two ways for Reclaim to expand their meeting capabilities:

1. More powerful tools for 1:1 meetings, both internal and external
2. Bring these tools to group meetings, not just 1:1

For now, Reclaim is focused on #1, and they recently launched Scheduling Links, making it easier to schedule one-off meetings with people inside or outside your company. (Although I am practically giddy for #2; imagine an automatic Doodle poll!)

Reclaim Scheduling Links are like a smarter Calendly, incorporating everything Reclaim knows about your priorities. For example, I have a high-priority scheduling link I can give people in certain situations—it allows them to book over any Habits or Tasks that Reclaim controls, knowing they can be rescheduled.

Putting it together

This is a lot of steps, but most of it is one-time setup. In the language of Make Time, it’s creating new defaults for your time so you don’t have to rely on willpower to make the right decisions about what to focus on.

Once the system is running, it creates a magical, dynamic, intelligent, automated calendar template that I could only dream about when we wrote Make Time. (And that was only five years ago!)

Here’s how it looks in practice—my actual calendar for this week, November 28, 2022. (Since it’s only Monday, I expect a few more meetings to get scheduled throughout the week.)

Humans are great at lots of things, but fiddling with calendars is not one of them. With Reclaim, I can let software take over. It’s already super smart, but will only get smarter as the Reclaim team continues to build the product. I can only imagine what it’ll be capable of in five years … who knows, maybe by then it’ll be able to attend my meetings, too? 😉

— JZ

A few weeks ago I was chatting with my friend Ned Dwyer, co-founder and CEO of Great Question. (They make an excellent all-in-one customer research platform that’s used by Brex, O’Reilly, MainStreet, and tons of other companies.)

I’m always looking for better ways to capture and understand lessons from customer research—indeed, much of what we do in Design Sprints at Character is exactly that!—so I was excited when Ned shared this visualization of customer feedback that they use internally.

It’s intentionally blurry, but hopefully you can see that the each piece of feedback is captured in a digital “sticky note”, color-coded, and organized by key customer.

It’s not perfect as a data visualization, but it tells a clear story: The cyan, light gray, and dark gray customers have more to say than the others!

This alone is valuable, because questions, feature requests, usability issues, and bug reports from customers indicate both the intensity and quality of their experience with the product.

But then it got really interesting…

Ned flipped into a different view, where each bit of feedback across customers was clustered by product area.

Now we have a much more valuable picture, showing that most of the feedback comes from just three or four product areas—across all of the major customers.

Then Ned took one step further and showed me a version where feedback was sub-clustered by theme within each product area.

I was really excited about these views, because I immediately saw that you can use an Opportunity Sprint or Cost-Risk Matrix to evaluate each problem area, then a Design Sprint (if needed) to figure out how to fix it.

As far as I know, Great Question designer Sean Langton made these visualizations manually in FigJam.

But I can imagine a powerful tool that makes and manages similar views automatically, helping product teams understand and prioritize opportunities—both negative and positive—based on customer feedback.

Perhaps Great Question themselves will build it…

— JZ

Here’s the 3-step process I use when helping startups evaluate and prioritize opportunities

Startups are super risky, never have enough time, and are obsessed with speed. As a result, the biggest question they face in any given moment is: “What should we do next?”

At Character, I talk to startup founders every day. When the subject turns to prioritizing opportunities — essentially trying to answer that “what next” question — I always follow the same three-step process…

Step 0: Is this opportunity valuable?

Just kidding, there are four steps because I started at zero! Gotcha! See, I still remember something from CS classes in college 🤓

This is an important pre-question. None of us should spend time on things that aren’t valuable. We may not always have that ability, but startups do: They are structured to focus on valuable opportunities all the time!

The answer to this question can be easy. The team may already know whether a given opportunity is valuable, or it may be obvious.

When it’s not easy, we sometimes run an Opportunity Sprint with the team to decide which opportunities to pursue. I promise to one day share our detailed guide and Miro template for the Opportunity Sprint, but for now I’ll summarize the process as:

1. Establish what we care about as a company and as individuals (our customers, goals, etc).
2. Capture all opportunities under consideration in a format that’s sufficiently detailed and concrete.
3. Get a gut check from the team on which opportunity is most promising.
4. Gather criteria we can use to prioritize each opportunity (“we should prioritize this opportunity because it’s ___________”).
5. Evaluate each opportunity with each of the criteria — the “winning” opportunities are those that score most highly on the most criteria.

Once we’re sure a particular opportunity is valuable, we have to figure out what to do with it. This is where I like to look at the relationship between cost and risk.

Step 1: What’s the cost-risk relationship?

Cost-benefit is the classic first way to evaluate an opportunity, but I don’t think it’s super helpful for startups.

Much more interesting to me is the cost-risk relationship.

There’s a two-axis plot I’ve been using for years to evaluate this. I think I originally picked it up from Braden Kowitz, my longtime colleague and mentor at GV.

It’s super simple:

To start, position one or more opportunities on the plot.

You may be wondering, How do I evaluate cost and risk for each opportunity? Here’s some advice:

• Use your gut.
• Don’t overthink it.
• Remember, at a startup, cost = time (you’re likely not spending money on anything but salaries!)

As a founder or early employee, you probably have a deep and well-tuned intuition about cost and risk, so lean on that and drop your pin.

You can plot multiple opportunities at a time, but even one is illuminating.

Step 2: What zone are you in?

Imagine you’re considering an opportunity in the low-cost band…

This is the “just do it” zone. Risky or not, if the cost (= time to complete) is low enough, you can just do it and find out.

In the lower left are mythical “low-hanging fruit” or “quick wins”. The lower right is where the hardcore lean-startup/MVP people hang out— though they often learn that most things take way longer to build than expected, bumping them out of the Just Do It zone 😇

Sometimes you’ll consider opportunities in the upper-left quadrant: High cost but low risk.

These are somewhat rare, but do exist. Some examples:

• “Table stakes” features (which you need to build because all of your competitors have them)
• Direct customer requests (which are so overwhelming and consistent you feel like the risk is low)
• Infrastructure or “technical debt” projects (maybe you need to rebuild your back-end to scale more efficiently; it’s valuable, it’s going to take a while, and it’s pretty low risk as long as your engineers are good!)

This is the “decide and commit” zone — probably the least sexy part of this plot, but where a lot of important startup work happens.

Our portfolio company House Rx thrives in this zone. They enable specialty medical clinics to launch in-house pharmacies. To deliver on this, they built modern pharmacy management software and a scalable pharmacy operations team. Both are tough to get right, and very costly, but neither one is totally risky from a product or technology standpoint.

The upper-right quadrant is the most important for startups — but it’s also the least understood. It’s where cost (and remember cost = time at startups) and risk are both high.

It’s pushing into a new market. Speculative new features. New applications for frontier tech. When we think about the startup dream and industries transformed by technology, we’re in this zone. The moonshot. The hail mary. The grand slam.

But when costs and risks are high, great founders resist the urge to step to the plate and take a powerful swing.

Instead, they know it’s time to methodically validate their assumptions and de-risk the opportunity. Because the cost is so high, they may only get one at-bat.

This is the “test and learn” zone.

We love to run Design Sprints here, to help startups make sure they’re on the right track before going all-in on execution.

Our portfolio company Phaidra is a great example, who used Design Sprints to de-risk their AI for factory controls. Or Fathom, where we ran sprints to design and test a dramatically simpler new product experience (including AI summaries) before rolling it out to all customers.

There are lots of other ways to test and learn (I summarized a bunch here), but the key thing is knowing which zone you’re in before pushing forward.

Step 3: Act accordingly

Most big startup mistakes come from prioritizing opportunities in one zone, but acting like you’re in another.

I’ve seen over and over — both in pitches and in working with startups — that many founders think they are in the “Just Do It” or “Decide & Commit” zone when in fact they are in “Test & Learn.”

In other words, they think the cost is low (we’ll have this live next week) or the risk is low (we know people want this) — when one or both is untrue.

At GV, I worked briefly with Juicero, which became a ludicrous warning about what happens when you Decide & Commit instead of Test & Learn.

At Character, we have one portfolio company (sorry, I can’t say which!) who over-committed to building features, thinking each one was low-cost and low-risk. Later, they had to pause and go back to clean up.

Stay in the zone

These frameworks are never perfect and always over-simplify, so your mileage may vary.

But I’ve found this one useful in helping startup teams understand how to approach the opportunities in front of them. In other words, helping them figure out what to do next — the most important decision for every startup.

— JZ

All startups have a product roadmap, but at the earliest stages, most of them don’t need one. That’s because a product roadmap is a plan for what you’ll build—but as a startup, you probably don’t know quite what you need to build.

On the other hand, you probably know exactly what you need to learn.

Remember, startups are learning machines, and the work you do as a founding team—talking to customers, prototyping, running experiments, etc—makes the machine go.

That’s why having a clear Risk Roadmap is so important for every startup.

“Risk Roadmap” is how I often describe your plan for what you need to learn. It should cover:

• What risks does your startup face? (Sometimes phrased as “what needs to be true?” or “what do we need to believe for this to work?”)
• What questions can you answer to de-risk your startup? (Essentially translating risks into testable hypotheses)
• What techniques will you use to answer these questions?

Let me share a few examples of how this looks and how you can use it.

Digit’s one big risk

Digit is an app that automatically budgets, saves, and invests for you, so you don’t have to think about it. We invested in Digit at GV and ran a Design Sprint with the team in 2014—right before they launched their initial savings product.

From talking with customers, the Digit team decided that trust was the major risk for the product. This was still early in the days of consumer fintech, and most people weren’t comfortable giving an app the ability to move money into and out of their bank account.

We decided the most important thing to learn was: Will users trust us enough to link their bank account? If not, nothing else on the roadmap would matter.

Experiments with copywriting, product, and marketing design helped us answer these questions, and the launch went really well. Digit eventually helped their customers save nearly $8 billion and was acquired by Oportun in 2021.

Building your Risk Roadmap in Design Sprints

Digit was focused on one major risk that would unblock everything else, but most times, a Risk Roadmap should contain a sequence of risks that need to be addressed.

Some teams are already doing this (we love to see it in a fundraising memo 😉) but many times, we build the first version of a startup’s Risk Roadmap together in a Design Sprint.

Here’s a rough example, with the risks phrased as “assumptions” here…

Here’s how we do this in Miro… (sorry it’s so heavily redacted!)

Marking progress with your Risk Roadmap

The best part of The Risk Roadmap — very much like a regular product roadmap—is that it’s so actionable. You can use your Risk Roadmap to plan what experiments you’ll run, and to keep track of progress toward de-risking your business.

For us, this often starts by connecting results from customer testing directly back to your risks.

Here’s how this looked in a Design Sprint with Phaidra…

And here’s an example of how you can summarize what’s been de-risked, and which risks are still open, as we did recently after a sequence of Design Sprints with a portfolio company…

The learn-to-build pipeline

Look, it’s definitely more fun to focus on building product than on answering these tough questions, and if you read enough VC tweets and blog posts 👀 it might seem like the only thing worth doing. (I’m still waiting on that Andreessen sequel, It’s Time to Run Experiments and De-Risk Our Startups.)

And product roadmaps are part of the fun—as a founder, there’s nothing more exhilarating than mapping out your vision for the future.

But if you don’t start by learning, you may end up building a future that doesn’t make sense for your customers or your company.

That’s why I think it’s so important to build a Risk Roadmap—to deeply understand the risks your startup is taking and make a plan for figuring out whether you’re on the right track.

There’s no perfect way to do this—it can be as simple as a list on a whiteboard—but it’s worth going slow now so you can go fast later.

After all, the only thing more fun than building your vision is going all-in building a vision that you know the world wants and needs.

Learn, then build.

And use The Risk Roadmap to find your way there.

— JZ

How the best startup teams combine the discipline of craft with the mindset of invention

A few months ago, I read The Wright Brothers for the second time.

It’s such a fun book, but what really struck me was the relationship between craft and invention in Wilbur and Orville’s story. To succeed as an innovator, like the Wright Brothers did so dramatically, you need to combine the discipline of craft with the mindset of invention. This is true whether you’re making software or flying machines. But craft and invention are not the same thing, and for startups, I think there are important lessons we can learn from understanding the differences.

Cycle Craft

Before flying machines, Wilbur and Orville Wright made bicycles. They weren’t bicycle innovators, but they made high-quality bikes, one at a time, to the highest standards of the industry. Their bikes were expensive, ranging from $30 to $100 — in 1890s dollars. If you wanted a great bike and you weren’t afraid of paying for it, the Wrights were your guys.

In other words, they were craftsmen. Buying a bike from The Wright Brothers was like hiring a furniture maker, calligrapher, or graphic designer — you’re paying for quality and reliability, but you probably don’t expect radically new ideas.

Everything changed when they focused on flying machines. They tried to build on the work of others (famously writing to The Smithsonian to ask for records), but found that most of it was theoretical pseudo-science—so they had to come up with their own solutions for everything from wing shape to lightweight construction to engine and propeller design.

When Wilbur and Orville flight started working on airplanes, they became inventors.

The Mindset of Invention

Invention is totally different from craft. You learn from others, but create your own solutions when necessary. You build lots of prototypes, expecting that most will fail to work but succeed in teaching you something anyway. You’re not building to the existing standards of an industry, so most people won’t understand you—and they might think you’re crazy.

The Wright Brothers embraced the mindset of invention when they created the first airplane, but they needed their skills as craftsmen to make it work. They needed technical skills and a well-equipped workshop. They needed to actually build things. But most importantly, they needed resilience — the dogged determination that comes from practicing your craft day after day.

For startup founders, investors, and early employees, there’s a lot we can learn from The Wright Brothers’ relationship with craft and invention.

Craft & Invention in Startups

First, I think we should remember that startups are in the business of invention. They take risks in the pursuit of innovation, with the goal of creating value by making things better for their customers.

But the best startups are full of people who have mastered their craft. Just like The Wright Brothers, honing their craft as bicycle builders before inventing the airplane, the best startup teams spend years building technology as craftspeople before starting a company.

This combination is essential. It’s why we look for complete teams when we invest in startups at Character — people who bring ideas and insights, of course, but also the hard skills needed to build the product and bring it to market. It’s why I’m wary of “idea founders” and innovation projects that separate the thinking from the doing. (Yes I’m looking at you, design thinking 😒)

Most important, remember that—especially if you come from a “craft” background as a builder—you need to deliberately shift into an invention mindset if you want to succeed at a startup. It can be painful, but it’s the only way.

From Craft → Invention

The best startup teams I’ve worked with (like Flatiron Health, Slack, Phaidra, etc) have demonstrated these shifts:

• From building → learning
• From shipping → prototyping and testing
• From feature roadmaps → risk roadmaps
• From perfect → good enough to learn
• From slow → fast

It can help to have a framework or method for making these new defaults stick. That’s why we run Design Sprints with the companies we invest in at Character, and why so many other startups have embraced the process.

The real magic comes from embracing the connection between craft and invention. If you’re a software startup founder but don’t know how to make software, you won’t find that magic. If the Wright Brothers tried to build an airplane before learning the craft of making machines by hand, they would have failed like everyone who came before them.

Once your startup gets airborne, you’ll gradually shift your focus back to the craft of optimizing a growth engine, scaling operations, and improving margins. But until then, be like the Wrights—be an inventor.

— JZ

That’s why I’m so excited to announce Character, my new VC firm. I teamed up with Eli Blee-Goldman and Jake Knapp to invest in seed-stage startups and support them with the Sprint method we developed at Google Ventures (GV). This is my dream job — leveraging my interests in design, time dorkery, and investing to help founders focus on the work that matters.

People want to make startups more complicated than they have to be. There’s a lot of highfalutin talk out there, but startups are really about just one thing: Creating new products that make life better for the customers you serve. Our mission is to help founders do that with focus, speed, and purpose.

If this sounds good to you, we’d love to talk.

The power and potential of the Design Sprint

I started my career in normal product design roles (to the extent “normal” existed in the industry back then). First at FeedBurner (where I was an early employee), then at Google (which acquired FeedBurner), and finally at YouTube, where I led product design for creator tools and the YouTube Channels platform.

In 2011, Google Ventures recruited me to join their team as a design partner. The premise was simple, but the opportunity was extraordinary: Use my design skills to help our portfolio companies be more successful.

At first, we took an ad hoc approach. We would show up, figure out what design problems needed solving, and get to work. In the first year, we redesigned RetailMeNot’s coupon site and Foundation Medicine’s cancer diagnostic report. It was fun and challenging work, and very rewarding. (Both companies went public and produced great returns for GV.)

But as our investing pace accelerated, we needed a scalable, repeatable system if we wanted to continue delivering hands-on design help to our portfolio.

We got in touch with Jake Knapp, who had created the Design Sprint at Google. He was running sprints with internal “startups” there, including Chrome, Google Meet, and Google X, and we thought this approach would work well for the startups we were funding.

Jake joined our team at GV in 2012, and we embraced the Design Sprint as our engagement model for working with the portfolio. With each sprint, we improved the process itself, adding, subtracting, and refining exercises until it worked reliably. Over the next five years, we ran more than 100 sprints with startups, including Flatiron Health, Gusto, 23andMe, Uber, HubSpot, Blue Bottle Coffee, One Medical Group, and Slack.

During this time, two interesting things happened.

First, we realized that the power of the Design Sprint was much more than just doing design at scale. Our sprints empowered teams to focus intensely on the core challenges of their business and accelerated time to product-market fit. For many of the startups we worked with, it was transformative.

Second, as word began to spread about our sprints, we realized that this kind of support — tactical, hands-on help with a startup’s most essential challenges — was more than just a nice-to-have. We began seeing evidence that startups actively wanted to work with us. Our team and our sprints made GV a more desirable investor to startups. And in the world of competitive startup fundraising, that’s valuable.

We decided to double-down on this value by investing in a public brand and audience for the Design Sprint. We wrote articles and created resources that were freely available. We gave hundreds of presentations, at conferences like Google I/O, The Code Conference, and Singularity University, and at schools like Stanford, Harvard, and MIT.

And we decided to write a book.

Sprint came out in early 2016 and was an instant New York Times bestseller. It was a calling card for GV, a step-by-step guide to the Design Sprint, and a behind-the-scenes look at the sprints we had run with startups.

Most of the startups we featured in the book went on to become big businesses and successful investments for GV. For example:

• We helped Blue Bottle Coffee find product-market fit for their online business. They were acquired by Nestlé for more than $700 million in 2017.
• We helped Flatiron Health find product-market fit for their OncoTrials product (and several others). They were acquired by Roche for $1.9 billion in 2018.
• We helped One Medical Group find product-market fit for their online patient services. They went public in 2020 at a valuation of $2.7 billion.
• We helped Slack expand product-market fit from early adopters to the broader enterprise market. They went public in 2019 and were subsequently acquired by Salesforce for $27.7B in 2021.

Why I’m getting back into startup investing

In 2017, I decided to take a mid-career break and left GV. I loved my time there, especially working closely with startup founders, but I was ready for a new adventure. So for the next couple of years, I enjoyed my time “off” and dabbled in a bunch of projects. I wrote another book, Make Time, with Jake. My wife and I took a long sailing trip. We moved to Milwaukee. I consulted with corporate clients and worked with startups as an advisor and angel investor.

This period gave me a lot of time to reflect on my experience with all those startups. Now that I had some space, I couldn’t stop thinking about three lessons that stood out from my career.

First, I became convinced that time is our only finite resource, and how we spend it matters more than anything. This truth is amplified at startups, who have a finite amount of time to build the right product and find the right customers before they run out of money.

Second, I realized that this pursuit — of product-market fit — is the essence of entrepreneurship. There’s a lot of fancy talk about startups, but they’re actually quite simple: Make something new that helps customers live better lives, and do it as quickly as possible. Simple doesn’t mean it’s easy, but it’s very inspiring to be in this position, with clarity of focus and purpose.

Finally, there was the Design Sprint itself. As the book continued to sell, and stories poured in from around the world (including teams at Nike, LEGO, the United Nations, and Harvard), I reflected on just how well the process works. The impact of the Design Sprint exceeded even our expectations, and we created the darn thing!

We continued to improve the method. A global community of sprint facilitators took shape, and we learned from their case studies and ideas. We taught more than 3,000 people how to run Design Sprints in training workshops and used their feedback to further tweak the process. And in early 2020, when the world went into Covid lockdowns, we gathered input from the community and shared our own advice on how to run remote sprints.

Meanwhile, GV continued to rack up wins, with great returns from early investments and splashy deals with late-stage startups like GitLab, Plaid, Toast, Opendoor, and Stripe.

In 10 years, GV had started from zero and become one of the most credible and desirable brands in VC — and Sprint is integral to that brand. But the reality is that the Design Sprint isn’t perfectly suited for the types of operational challenges that late-stage startups face. It’s useful for all kinds of teams, but it’s a true game-changer for early-stage startups.

So as GV focused more on late-stage investing, and we moved on to new projects, it created an odd situation. Jake and I were leading the Design Sprint movement, but we didn’t have a vehicle for running sprints where they work best: with early-stage startups.

I realized that my work — as a designer, facilitator, and writer — remained mostly the same, but the business model changed. I was now a consultant, not an investor. I missed the alignment and shared incentives of investing in startups and working together over time. My experience at GV had been transformative, and I began thinking about how to recreate the best parts of that magic. I saw an opportunity to do something truly unique in venture capital; something that built on my experience at GV.

There was only one problem: I didn’t know how to run a venture capital firm.

Creating a VC strategy based on the Design Sprint

Fortunately, in late 2019, I met Eli Blee-Goldman and we became friends. I felt like I had won the cosmic lottery. There aren’t many VCs in Milwaukee, yet here was a brilliant under-the-radar investor who had built a fantastic portfolio. Even better: As an apprentice at a small firm, he had learned the brass tacks of venture investing — from internal process design, to fund administration, to portfolio construction, and fundraising.

In early 2020, we talked about starting a VC firm together. We talked a lot. We spent months trading notes and ideas and lessons. We made Google Docs, slide decks, and Notion pages.

From our earliest conversations, Eli helped me understand the opportunity to build a VC firm around the Design Sprint.

He shared his experiences as a traditional startup investor, where he often joined company boards and supported founders with coaching and advice. But he saw the limitations of that approach, and told me that “value add” can easily become “value destroy” when you’re not working hand-in-hand with the team.

The Design Sprint is an antidote to that model, providing a format for investors and startups to truly collaborate on solving problems together. What if we supported our portfolio companies by running sprints together, like we had done at GV? But what if we embraced this model as the core of our strategy, not just one thing on a menu of offerings?

Eli helped me see how unique this approach would be. The market for seed capital is crowded and commoditized. We looked at dozens of our peers and realized they were all saying the same things. Every investor is going to be your trusted partner from day one. They’ll pick up the phone when you call. They’ve been in your shoes, so they get it. You can almost copy and paste the text between websites.

In any market, sameness — when all the competitors look the same and do the same things — creates an opportunity for new companies to succeed by offering something different.

But this is especially true in venture capital, where the ability to invest must be earned and not taken for granted.

Startups do not need to take our money. They can bootstrap, raise other financing, or work with more established investors. At GV, I learned that the most successful companies get to pick and choose their investors, based on who they want to work with and what those investors are offering.

As a result, we know we need to earn the ability to invest in the most promising companies. And we do this by making founders an offer: We will work hand-in-hand with your team, running sprints to help you find and expand product-market fit.

Startup founders are our customers, and we’ve built our firm around the Design Sprint because we believe it’s a “product” that our customers want. From our experiences at GV and beyond, we know how well the process works. We know it creates positive word-of-mouth and opens the door to competitive deals.

And nobody has more experience with sprints at early-stage startups than we do. We know how to maximize the impact of the Design Sprint, and we know how to scale it — because we’ve done it before. When founders partner with us, they’re not just getting access to the creators of the Design Sprint. They’re getting world-class sprint facilitation (from us) and hands-on contributions from designers (also us!) who have coached some of the world’s most successful startups through pivotal moments.

In the right hands, the Design Sprint can help founders solve the high-stakes problems they wrestle with every day. We’re excited to solve those problems together.

Turning plans into action

Of course, I couldn’t imagine doing this without Jake Knapp, who invented the Design Sprint at Google and has been a close friend and collaborator for nearly 10 years. So I began to talk with Jake about what we were planning.

He was excited — in particular, for the opportunity to run Design Sprints with early startups. We’ve worked with companies of all sizes, but the sprint process always worked best at early-stage startups, which are relentlessly focused on testing hypotheses in pursuit of product-market fit. Our new firm would give us the ability to focus exclusively on those kinds of projects.

Jake pointed out that having our own fund could make sprints even more effective. At GV, we helped companies post-investment. We collaborated with our partners on the investing team, of course, but there was a hand-off from investors to designers after the funds were wired. Jake believed that running sprints as investors would allow us to partner more deeply with founders and provide even more effective help.

Our first sprint collaboration as a founding team was actually an internal project. We needed a name for our new firm!

So, in the somewhat-gross parlance of vintage Silicon Valley, we “ate our own dogfood” and ran a Name Sprint — an 8-hour process that combines the Brand Sprint with a series of Note-and-Vote naming exercises. We came up with 38 themes, which resulted in 92 names, including Lantern Ventures, Query Capital, and Likely Ventures.

After several rounds of evaluation, a thorough check of domain names and trademarks, and an extra night to sleep on it — just in case — we had our name: Character.

Why Character? The word has a lot of great meanings: It’s about people, growth, and integrity, and it even relates to coding (symbology) and design (typography).

We were tempted to choose something lighthearted, but we like the weight of Character. We like the responsibility of what the brand implies. Our name is a promise (to you) and a standard (for us) to invest with honesty, integrity, and transparency.

But the most important meaning is a bit more personal…

In this post, I’ve written about why I got back into startup investing four years after leaving GV. The basic reason is this: My personal mission is helping people make time for work that matters. By supporting founders, I help create meaningful products and businesses that in turn create meaningful change for their customers. By investing capital along with my time, I can amplify founders’ ability to spend time on this work.

How we spend our time is the most personal of decisions, because time is our only finite resource. An hour spent at work is an hour we can’t spend with family or friends, or taking care of ourselves, or serving our communities. That’s why it’s so important to focus our time deliberately, intentionally, on work that matters.

Character is about your actions, not your intentions. It’s about doing what you say you’ll do. About closing the gap between your goals and the specific steps you take to get there. Character is personal, because your actions define who you are. Not just how you conduct yourself, but what you spend your time on.

By investing capital to buy you time, and running sprints to help you focus, we’re here to help you translate your plans into action. We’re here to help you and your team spend time on the work that matters.

Character is a new VC firm founded by John Zeratsky, Jake Knapp, and Eli Blee-Goldman. Character builds on Zeratsky’s and Knapp’s work at Google Ventures (GV), where they developed the Design Sprint, worked with 100+ startups including Flatiron Health, Blue Bottle Coffee, and Slack, and wrote the bestselling Sprint book. Blee-Goldman brings a strong track record in software investing and broad experience in fund management after 10 years as a VC at Capital Midwest.

Character invests up to $1M at seed stage into startups betting on big shifts in customer behavior. They are a remote-native firm investing in companies located anywhere in the USA. They work hand-in-hand with founders, using the sprint method they created at GV, to help startups find and expand product-market fit.

The pursuit of innovation is inherently risky. Innovation is about creating value by doing new things, which implies a built-in risk that the new thing won’t work as well as the old thing.

For me, this is a helpful connection to keep in mind when I’m evaluating or working with startups.

The question I try to answer is: What type of innovation is this company betting on?

From that answer, I can understand what type of risk they are taking.

When I understand the risks, I can:

1. Make a judgment about whether I think the risk is going to pay off, and
2. Help the team address those risks with Design Sprints or other forms of discovery and validation work.

In the world of tech startups, most of us think about product and technology risk. This makes sense, because products are very salient (we all use them every day) and because technology innovations have enabled most of the big changes to our world in the last 150 years.

But product and technology risk are simply the most visible — they are far from the only ways in which startups take risks when pursuing innovation.

Here’s the list I run through when evaluating or working with a company:

Product Risk — Will our product be better than what exists? Will it be more successful in helping customers reach their goals? Will it be more useful, more usable, more fun, etc?

Technology Risk — Will it work? Will the new technology be reliable enough, fast enough, good enough? Will the technology be financially and operationally sustainable?

Team Risk — Do we have the right people? Can this team fund the company, hire well, validate the other risks, and execute?

Market Risk — Will anyone care? Will people use the product? Will we be able to reach customers? Will the market trust us? Is the market as large as we think it is? Is it growing?

👆 This one also includes marketing and go-to-market risk. You could unpack this risk a bit more and dig into the components if necessary. (That’s actually true of all of these.)

Business-Model Risk — Will the business make money? Is the model financially sustainable? Can we achieve the costs (via technology and operations) and revenue (via customer acquisition) to make the model work?

👆 This one doesn’t get as much attention, but as the tech industry matures, we are seeing more and more business-model risk. A whole generation of startups adopted and proved SaaS, for example, and then giants like Adobe, Microsoft, etc pivoted their businesses to this model. Startups like Airbnb and Uber have taken huge business-model risks. And some startups are basically all business-model risk. Cashdrop comes to mind, and indeed, founder Ruben Flores-Martinez has shared how economics, not technology, are at the core of his strategy.

Funding Risk — Can we finance the company until it’s sustainable? Can we raise adequate and appropriate funding? Do the capital requirements match the other assumptions about the business?

👆 This is not 100% tied to innovation, but it’s super important. The risk is not just that you’ll run out of money — plenty of startups have been ruined because they raised too much too fast, or because they financed the company in the wrong way. These are very real risks that should be surfaced and addressed in every startup.

What did I miss? Any other big risk categories I’m not thinking about?

Finally… I believe it’s possible to build a successful company (and generate venture-scale returns) by betting on one or two of these risks — you don’t have to innovate in every single category.

But I think it’s true that some of the biggest blockbuster startup successes have embraced most or all of these risks: Product, Technology, Market, Business Model, etc. After all, taking bigger risks generally leads to the possibility of bigger rewards. (It also leads to the possibility of failure. And most startups, in fact, fail.)

An obvious example of this “all in” approach to risk is Google’s original Search and Ads business:

• Google Search began as a research project about new technology for determining the quality of a webpage. There were risks in the validity of the approach as well as the execution of that approach at scale. (Technology Risk/Innovation)
• Google bet that a simpler, cleaner, quality-driven search engine would win, even though search was considered “solved” and the “search wars” were over. (Product Risk/Innovation)
• They bet that the aggregation of attention would be extremely valuable and that an auction could be used to price that value for advertisers. (Business-Model Risk/Innovation)
• They bet that advertisers (mostly small ones at first, and then larger ones) would buy ads to send traffic to their websites, and that the overall trend of ecommerce would accelerate. (Market Risk/Innovation)
• They bet that transparency, near-realtime reporting, and precise targeting would be killer features in their advertiser products. (Product Risk/Innovation, again)

There are others that come to mind: Stripe, Apple, Netflix, Spotify…

At some point I’ll write a follow-up about how to mitigate each of these risks and validate potential solutions rapidly. Until then, thanks for reading!

— JZ

A spotlight for every stage

The other day I wrote that startups are learning machines, and shared some of the most common techniques I see startups using to learn.

(Dave Ambrose reminded me of a great quote from Josh Kopelman, from his interview with Patrick OShaughnessy: “A startup’s job is to learn.” Yep!)

That post prompted a couple questions, about whether this always true, and where the types of learning change at all as a startup evolves.

Here’s the simplistic way I look at it:

• Pre-seed, a startup is focused on discovery — What opportunities exist for us to solve big problems with the product or service we’re imagining?
• At seed stage, a startup is focused on validation — Is our product/business working? Are the risks we are taking (on product, marketing, business model, technology) paying off?
• At Series A, a startup is focused on growth — The playbook for the core business is set, and the learning is all about how to grow. Are we growing at the right rate? Is our growth engine running the way we thought it would? What’s working or not?
• At Series B and beyond, a startup is focused on operations — Can we do this at scale? How can we optimize our margins and growth rates?

Of course, the previous focus doesn’t totally go away. The new focus just stacks on the old one. A startup never stops caring about growth. The questions never go away, so validation continues to be an essential function. Even startups can get complacent, so you have to reinvest in discovery of new opportunities.

But it’s sort of like a spotlight on stage: The focus may change as the company evolves, but the rest of the stage never goes completely dark. It’s just not front and center anymore. And that’s okay.

— JZ

The best early-stage startups are optimized for learning — about their customers, whether their product will work, how to get people to use it, etc.

Oh sure, there’s plenty of other stuff that startups have to do. And like all businesses, they exist to create value for their shareholders, customers, and communities (ideally 🙏).

But none of it matters to a startup if they can’t figure out what’s going to work. And… “figuring out”? Well, that’s just a folksy way of saying “learn.”

There are lots of ways for startups to learn. Here are a few that almost everyone uses:

• Talking to experts, whether those are industry insiders, other startup founders, successful executives, or investors (although I don’t know if investors always have quite as much expertise as they’d like to think 😉)
• Interviewing customers, often without showing them a product or prototype. I’m not sure why, but chatting with customers pre-product is considered “customer development” and it’s a high-status activity at startups, while showing a prototype to customers is called “user research” and is foolishly given low status. </rant>
• Building and shipping an MVP, which has become the default learning tool thanks to The Lean Startup, Y Combinator, and a few other influential voices. This is good because it gives startup teams a reality check; bad because it still takes a looong time to build an MVP and the learning usually happens via data, which is necessary but not sufficient (you need to talk to people!).

There are other, less frequently used techniques, like surveys and fake door tests and data analysis — and probably a million others that I don’t know about.

There’s one new technique that I really like: 1-on-1 onboarding for every new customer. As a founder, you can learn a ton, make your customers feel special, and increase their success with the product. There’s one big challenge, though: You need a real product for this to work.

(AFAIK this approach was popularized in the startup world by Superhuman. Vimcal is doing it now for their new calendar app, which is wonderful. (I’m a total calendar nerd, did you know?) Again, I’m sure lots of people are doing this and have done this that I don’t know about 😇)

And of course, I’ve got a horse in this race: The Design Sprint is a high-bandwidth 5-day process for learning through rapid prototyping and moderated customer testing. I’m biased, but I think it works really well: We’ve run sprints with Slack, 23andMe, Medium, Flatiron Health, Nest, Digit, Blue Bottle Coffee, Foundation Medicine, and tons more startups. (Fun: I got a note from Atoms founder Waqas Ali that they used design sprints in the development of their amazing sneakers.)

But this post is not an ad for the Design Sprint process, I promise 🤓

Mostly, I wrote it to organize my thoughts around how startups learn, and to ask for your input:

• What did I miss? What other ways do startups (internal or external) figure out whether they are on the right track?
• What works for you? Last time you were doing something big and new, how did you learn whether it was working?

— JZ