Exploring Powerset: A Revolution in Investment Strategy
Powerset, born in the twilight of 2022, is reshaping the investment landscape with a radical hypothesis: what if the best investors are not venture capitalists, but fellow founders? Imagine founders scribbling investment checks amidst their coding marathons and boardroom deliberations. This avant-garde approach, spearheaded by AngelList veteran Jake Zeller and Athena founder Jonathan Swanson, dispenses $1 million annually to five to ten founders, empowering them to invest in promising startups. If these founders make astute investments, they stand to gain millions more.
- Notable past participants include Paul Copplestone, cofounder of Supabase.
- Jordan Tigani, cofounder of MotherDuck.
- Wes McKinney, the mastermind behind Python’s pandas project.
This week marks the opening of applications for the third cohort. Zeller describes Powerset as a decentralized venture fund without traditional constraints. There’s no rigid curriculum to instruct founders on investing, no deadlines for capital deployment, and no managing partners wielding veto power over deals. Founders earn a fifteen percent profit share on successful investments.
“It’s an experimental model that bridges angel investing — yet without founders spending their own money — and traditional VC scout programs,” Zeller explains.
{Jake Zeller}
The Unique Approach of Powerset
Participants are encouraged to mentor and advise the portfolio companies they invest in. Unlike typical investors, these founders juggle their own ventures alongside new investments. “Some founders are so occupied with their businesses that they rarely invest,” Zeller notes. Conversely, a founder might transform from a non-investor to a prolific one swiftly.
Zeller firmly believes in Powerset’s potential for massive returns, asserting that the best founders often become exceptional investors. Founders possess an intrinsic understanding of startup intricacies and constantly scout for top talent. “I’ve never met a technical genius building an extraordinary company who struggles with investment,” he adds.
Who Qualifies for Powerset?
There are no rigid prerequisites for joining Powerset—participants need only be entrenched in building a tech company. “Ideally, your company reaches a scale where you’re organically connected within the ecosystem,” Zeller suggests. This means other founders appreciate your product and naturally engage with you.
Zeller emphasizes one critical disqualifier: he’s uninterested in individuals viewing Powerset as a stepping stone to venture capitalism. “Those people will perform terribly,” he warns. The most successful Powerset participants are those committed to growing their companies over five to ten years.
“If you’re dedicated to creating something significant that aligns with your life mission, you won’t invest in mediocre ventures,” Zeller concludes. “Such endeavors don’t warrant the effort.”
{Jake Zeller}
