Dan Levitan, the cofounder of venture-capital firm Maveron, backed eBay a decade and a half ago.
He says it’s still a good time to invest in consumer startups, despite a vogue in the industry for enterprise startups that primarily sell to businesses.
Maveron, which only funds early-stage consumer startups, is doubling down on the number of companies it will seed, Levitan told Business Insider.
Maveron wants to make at least one seed investment per month in a new consumer startup.
It has already funded three companies so far in 2013, and more than 15 in the last two years, including Everlane, CircleUp, Julep, and CourseHero. It has a long history of success, too. Besides eBay, Maveron funded Shutterfly, Drugstore.com, and others.
Why are so many of Levitan’s peers sour on the startups he believes in?
In 2012, after Facebook’s IPO stumbled while Splunk and ServiceNow soared, enterprise startups became a hot commodity for venture funds.
That happened for a number of reasons, venture capitalist Jamie Goldstein told Business Insider at the time. The venture industry was reacting to 2010, when the “world was gaga for social media,” he said. By 2012, Facebook, Groupon, and Zynga “began to show weakness,” he said—and Box, an enterprise startup, raised $125 million.
“Enterprise isn’t going away,” Levitan said. “I’m saying there’s plenty of money out there for great consumer entrepreneurs with great consumer products attacking really big markets.”
He offers Zulily as an example. Zulily, a daily-deals site for mums, launched in 2009 with $4.6 million from Maveron. In November, Andreessen Horowitz invested $85 million on a $1 billion valuation.
Levitan is looking for more e-commerce sites like Zulily as well as education and consumer health-care startups.
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