Building a VC Fund – When Change Gets Real

Part 15

Facing the First Obstacle Together

Good morning, thirsty friends. Today, it’s all about the importance of change—especially the hard kind that comes with tough conversations and even a little anxiety. This is founder reality: if you want to make progress, you can’t avoid it.

We’ve officially run up against our first major challenge as a syndicate, and I’m going to be more transparent than some might be comfortable with. That’s why I started this whole thing. Truth matters. Our mission was simple: invest in early-stage food and beverage CPG brands. Early means early. Some of these brands have no revenue, or revenue that isn’t always tied to valuation. I’ve always been fine with that because I care more about traction, concepts, and early signals the rest of the world hasn’t seen yet.

What became clear, though, is that the group really values revenue when it comes to valuation. That’s reasonable and valid. Some people trust the vision, others lean hard on the numbers, and we need both.

What Didn’t Work (And Why)

From the start, my plan was to wait for the syndicate to hit about 50 members before bringing our first deal, because not everyone wants to invest in every category. Some folks want only food, some only beverage. That means full participation will never happen, and that’s fine.

That said, I took a swing on Smearcase and was genuinely excited about the brand and the founders. But what I predicted came true: participation was low. If our group size had been double, we might have hit the target, but here’s where we landed.

There are significant costs and legal requirements for each deal, and these investments can take a decade to materialize. That’s why we set a $50,000 minimum. I thought with 50 members and decent participation, we’d easily cross that line. It turns out, for this first deal, that assumption was wrong. I’ve always been transparent with founders: “I love what you’re doing, but our group isn’t big enough yet.” I’ve been careful not to push investments that aren’t a fit, because I don’t want members to lose interest if early deals flop.

Learning and Moving Forward

The right call here is to pause. This deal isn’t hitting the mark. Joe and Drew at Smearcase are incredible, and if this were a fund, I’d write the check myself. But right now, I can’t. Wanting something isn’t enough if you can’t execute. We’ll keep searching for great brands, keep talking to founders honestly, and I’ll keep growing the syndicate. We passed 30 members, and 50 is still the goal, but hitting it means getting louder, being more consistent, and bringing in more of the right people.

Next up, we’re looking at a new opportunity with HY.Q

If you know me, you know I’ve been talking about them since day one. Rick and his team have a great product, strong strategy, and the deal might just align better with the group’s appetite this time.

I’ll own it: I made a mistake on this first deal. But mistakes are only wasted if you ignore them. I’m not discouraged. I’ve grown a lot these past five years adapting, failing, learning, and getting back up. Smearcase just wasn’t the match right now.

The Opportunity Ahead

We’re not at the finish line. Everything up to now is only the beginning. If you’re reading this, I need your help to build this. Share, invite, connect. We’re trying to do more than talk brands—we want to actually invest and make a difference.

Each failed deal is proof of just how many founders and brands are out there, hustling and waiting for a believer. It’s tough. It’s supposed to be. But the ones who push through, who take all those setbacks and keep showing up, those are the builders who change culture and categories.

Thank you for following along, for supporting, for sharing. More updates soon. Have a great day and a great week. Your participation is what makes this possible.

Stay thirsty.