Startups

Amazon’s $200 million venture-capital arm has backed over 100 startups. The head of the Alexa Fund shares 4 tips for founders to land its backing.

  • Amazon oversees a $200 million war chest set up to fund promising startups.
  • The Alexa Fund has poured money into more than 100 companies since launching in 2016.
  • Insider sat down with its director to learn what it takes win investment from Amazon.

Amazon introduced its first concerted effort in venture capital, the Alexa Fund, in 2015 to find companies and developers building products around voice technology.

Alexa Fund director Paul Bernard

Alexa Fund director Paul Bernard. Amazon

With a $200 million war chest, the Alexa Fund writes checks worth up to $150,000 to secure a stake in promising tech startups. The fund offers founders the “tools, resources, and connections they need to build a successful company.”

Insider sat down with Paul Bernard, the director of the Alexa Fund, to find out what it was like investing Jeff Bezos’ money and what entrepreneurs needed to do to win a spot in his portfolio.

Bernard said it had been interesting to see how the working environment had changed so much over the past 18 months.

“Working virtually has forced us to learn new behaviors. I never thought I would have made an investment without having met a founder in person,” he said. “But you adapt. … Speaking personally, there isn’t a substitute for the connection you get from being in a room with somebody.”

1. Be customer-obsessed

The fund, Bernard said, is focused on companies that are obsessed with their customers, in keeping with Amazon’s stated customer obsession. Among the raft of startups it has backed is the interactive music service Musician and the microphone manufacturer Vesper.

“We’re looking to invest in compelling startups that are on the forefront of voice innovation, ambient computing, and the future of the digital consumer,” Bernard said.

“And we’re also customer-obsessed — we’re looking to work with mission-driven founders who have ideas for how technology can improve everyday life,” he added.

2. Think about smart use cases

The Alexa Fund is focused on “ambient” technology — devices that are built to integrate with their environment and be responsive to humans’ presence, much like the device the fund was named for. Bernard said they were “technologies that work on your behalf without occupying a user’s attention all the time.”

“Alexa is a good example of this, but it’s not the only example,” he said.

A startup may be working on devices like this themselves or “the underlying science and technology” that powers ambient tech, Bernard said — either way, the Alexa Fund is interested.

“Try to solve an unmet need or solve a need that’s already being met, but in a better or more efficient and convenient way,” Bernard added.

3. Lead with a vision

Blue Origin founder Jeff Bezos wears a pair of reflective aviation glasses under a cowboy hat

Blue Origin founder Jeff Bezos with aviation glasses that belonged to Amelia Earhart. Joe Raedle/Getty Images

The founders and CEOs of the best-known tech companies all have visions for their success.

Bernard said any founder hoping to win investment from the Alexa Fund needed to be “passionate and purposeful about the problem you are trying solve … and make it a big one.”

“Be prepared to fail big in pursuit of that objective. Be less worried about being the next unicorn or collecting vanity metrics. That will follow,” he said.

4. Consider how your tech could work with Alexa

amazon alexa

The Alexa Fund is naturally interested with companies that it can dovetail with. Shutterstock

“We are pretty interested in where things are going with synthetics, virtualization, and creators,” Bernard said.

One of the fund’s portfolio firms, Endel, has been creating “personalized soundscapes” in collaboration with artists like Grimes and Plastikman to help users sleep or relax.

Another portfolio firm is Labrador Systems, which is developing assistive and autonomous robots that ensure older people and those with mobility challenges can “maintain independence.” Bernard said the concept was “very much complementary to how technologies like Alexa can increase peace of mind for seniors and their caregivers.”

Insider sat down with Paul Bernard, the director of the Alexa Fund, to find out what it was like investing Jeff Bezos’ money and what entrepreneurs needed to do to win a spot in his portfolio.

Source: https://www.businessinsider.com/amazon-alexa-fund-technology-startup-funding-2021-10?op=1

Donovan Larsen

Donovan is a columnist and associate editor at the Dark News. He has written on everything from the politics to diversity issues in the workplace.

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