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Digg"I am on a mission, and I will not rest until there is balance in the force," TheFunded.com founder Adeo Ressi, tells Tech Confidential, joking only slightly... we think. "The symbiotic relationship between entrepreneurs and venture capitalists is at an all-time low, and my goal is to fix that."
The former CEO of Game Trust Inc., a casual gaming software company sold last month to RealNetworks Inc. in what Ressi describes as a "sizable eight-figure acquisition," certainly has a sense of humor, and drama. After months of intrigue, the New York entrepreneur stripped off his mask and revealed himself as "Ted," who'd left his mark on various VCs by starting a service that lets people rate them and their firms.
As Tech Confidential (and lots of others) predicted, Ressi is exactly who he said he was--a modestly successful serial entrepreneur who, while not famous, will be familiar to some readers of The Deal and Tech Confidential. Before founding Game Trust in 2002, he launched and sold two successful companies, an online city guide called Total New York, which was acquired in 1997 by a joint venture of AOL and The Tribune Co. (renamed AOL Digital City), and Web developer methodfive, purchased by Xceed in 2000 for $88 million.
"He's a good guy, smart, scrappy," says Union Square Ventures co-founder Fred Wilson, echoing comments made by others in the New York investment community, where Ressi is well-known. Incidentally, the 3,480 registered members of TheFunded.com, which includes more than 3,200 CEO's, gave Wilson top honors when voting for their favorite venture capitalists.
As you'd expect from the man behind TheFunded, Ressi has had his share of bad experiences with investors. To wit, Softbank Capital a couple years ago required him to sign a term sheet with a mandatory no-shop clause, only to pull out of the deal at the last minute. Game Trust "almost went bankrupt," Ressi says.
In another run-in, in 2005 he succeeded in raising a $9.2 million Series B round led by TWJ Capital and NJTC Venture Fund, only to have TWJ's Tom Jones make a "take-over play," Ressi says. That involved ousting PayPal founder (and former college housemate of Ressi's) Elon Musk and replacing him with Jones' son, and asking Ressi to step down as CEO.
Although Game Trust investors ultimately persuaded Ressi not to leave, he found himself with time on his hands at the end of last year. Believing that Game Trust would need to raise more money and that he would likely still be involved in some role, Ressi started TheFunded as a personal project. The idea was to help him vet investors by swapping stories with a dozen of his CEO friends, including Mahalo Inc. CEO Jason Calacanis and MySpace vice president Shawn Gold.
Today, Ressi insists he's not out for revenge (although someone appears to be, given the anonymous email I received Friday morning from "Snarky Source" urging investigations into Jones' alleged bad behavior, an email Ressi says he suspects may come from a shareholder who feels burned). Ressi, who's in the middle of relocating from New York to Palo Alto, Calif., has cut ties with Game Trust and is focused solely on TheFunded. He says he wants to concentrate on providing entrepreneurs with information and tools that will help them evaluate potential investors. His broader goal: to simplify the process of getting funded.
"Today, many companies have to pitch 50 to 100 funds, and it takes six months or more, and the term sheets are filled with arcane, complex terms," Ressi says. "My vision is that you should be able to close a deal by pitching less than 10 funds in two months with reasonable deal terms."
What about funding for TheFunded itself? He says with a laugh that VCs are beating a path to his door, eager to capitalize on the site's popularity and recent notoriety. But Ressi, who is clearly enjoying his 15 minutes of fame, says he's content being TheFunded's sole employee--and its sole investor. - Mary Kathleen Flynn
See previous post on Ted from Tech Confidential
See interview with Adeo Ressie from Wired
For more see Common Stock Not, iMac Blog, ValleyWag, VentureBeat, iMac Blog
