Eric Thorenberg It doesn’t exist anymore. The co-CEO of tech company OnDeck is trying to grow its community in a way that brings in founders capital and mentorship. Torenberg, a former Product Hunt employee and founder of investment firm Village Global, took on the role just over a year ago. But now Torenberg is returning to the chairmanship as On Deck returns to its founder-centric roots and runs his second venture.
“Now that we’re an agile company with a focused mandate, it makes sense to return to our roots and operate as we have for much of our history,” an OnDeck spokesperson said in an email. “Eric will be deeply involved in Deck as he has been from the beginning.”
The move with workers last week is the latest shakeup at the business, which has cut a third of its workforce months after cutting a quarter of its workforce. Other changes at the popular startup include the sunsetting of several communities and moving the operations arm to a new separate business entity. Spin-off Cement on Deck’s goal is to be a founder-focused business, rather than a broad platform where anyone in the tech world looking for a community needs more services.
David BoothHe co-founded On Deck with Thorenberg, who will now be the sole CEO leading the business. The company has raised tens of millions of venture capital from investors including Founder Fund, Village Global and Tiger Global. On Deck told TechCrunch that Booth was unable to do a phone interview today due to family obligations.
“A lot of people are very happy because they don’t have to do a lot of amazing business in two businesses, run by two CEOs, following two completely different customer segments, and knowing how this one brand can be stretched to make everyone happy,” says a source. “In the room. Everyone inside is talking about the same person.”
Today, people can apply for the ODF program by going to the On Deck website. It looks like a classic accelerator, but maybe one step ahead of Y Combinator. And instead of an equity exchange or check, founders fork over $2,990 to be part of the program. The next iteration, starting September 27, will include weekly programs on skill development and workshops, starting with an onboarding process where founders are introduced to the community. There are also services that help founders find other co-founders, prepare for the fundraising process, and build small viable products.
This seems to be Deck’s flagship program that takes place over a full year at the moment. Other On Deck programs are eight to 10 weeks shorter and focus on different roles. At Deck Scale for high-growth founders and venture-scale companies, the costs are $10,000, or about $1,000 per week. While it claims to be focused on founders, it still promotes programs for others in the startup world. On Deck Angels, to take another example, operates for Angels who want to expand their network or start a fund, and a $5,000 donation to the On Deck Access Fund (fellows who receive the On Deck Scholarship Fund can apply and receive it accordingly) Funding Need: 2 million from 2021 Dollars have been deployed. Execs On Deck is for experienced leaders seeking VP and C-suite roles at startups and costs $5,000.
While this may seem separate from the founder’s focus, it’s advertising, but On Deck sees it as relevant. “We’re building the world’s most supportive community of angel investors and executives, both of whom are critical partners to founders at all stages of a company’s formation,” the company told TechCrunch in an email.
The revamped and smaller product offering comes after On Deck admitted struggles with offering a focused product. “Over the past two years of tremendous growth, On Deck has launched communities that serve more than ten thousand founders and professionals. Our team has worked tirelessly to expand and cover a wide area,” the co-founders wrote in a blog post about the latest strike. But this broad focus has led to serious tensions. What we always envisioned as a strength – serving multiple user groups and building flywheels among them – broke our focus and brand.
As with any venture-backed startup building in today’s more cautious climate, tensions are common. However, sources explain that the stripped Tiger Global term paper was one of the first dominoes to fall, providing a rare glimpse into the inner workings of a company trying to launch so many things at once.
Deck’s themed pivot is a response to problems created in part by the startup’s biggest investor: hedge fund Tiger Global. According to documents seen by TechCrunch and sources familiar with the company, Tiger Global quietly led a $40 million Series B round with On Deck in August at a valuation of $650 million, which is more than the $175 million funding round that was allocated when the Series A closed — first reported by The Data but not confirmed by On Deck — It looks like an introduction to the official development phase of the startup. An
Sources tell TechCrunch that after leading On Deck’s Series B, Tiger Global has committed additional funding to the startup’s upcoming venture fund. Months later, a $100 million round for AngelList Ventures, which valued the hedge fund at $4.1 billion, was not an out-of-character bet.
Tiger’s investments in both the AngelList and On Deck deals are designed to provide a clear view of the pre-seed and seed world.. In return, On Deck gets a big raise and an anchor investor for its new venture (one that probably has a good name to attract interest from other investors). Tiger Global continues to provide funding through On Deck Vision to ODX Fund, an investment vehicle that will help launch the accelerator. Until then, On Deck charged membership fees to generate income, and a fund traded it for bets on longer-term returns.
According to sources, a word sheet – a document – was placed on the table. On Deck, in turn, began pitching Tiger Fund’s commitment to other investors, eventually planning a $100 million fund that it could use to invest in fast-moving companies.
When it came time to make the capital call, sources say Tiger Global told the startup that the fund’s commitment was still under due diligence. While the company declined to comment on its relationship with Tiger Global at the time, an OnDeck spokesperson told TechCrunch, “Due to the closing of fund LPs, OnDeck Holding Company has made a capital credit call for the ODX fund to enable… To deliver on commitments to portfolio companies.
Finally, Tiger Global has invested in the company and seems close to hedging its bets, sources say, to invest in the On Deck Fund. On Deck did not comment when asked about this situation. TechCrunch reached out to a Tiger Global spokesperson for comment, but did not hear back by press time.
While one round can be devastating, it’s not unusual to see companies issue yank term papers after doing due diligence or in response to poor economic conditions. It’s unclear why Tiger pulled the plug after leading the investment, but the company has certainly had a rough time in the public markets.
In the case of On Deck, sources say Tiger pulled the commitment and put him in a dangerous position on deck. Without Tiger Capital Inf On Deck was taking it off its balance sheet, with only nine months to go. Then came the layoffs.
On the cruise they cut several rounds in May and August. Sources said the first round of layoffs was not enough. The company then launched its career services platform, claiming that some employees are being bullied because of the individuals involved. The spin-off company does not have a name, but plans to launch in October. It is generating revenue.
From the novice to the classic investor
It’s a delayed return to focus. A worker on a ship Erica Bautista He became a general partner of On Deck Fund last month after helping build the company’s European accelerator. The fund, On Deck tells TechCrunch, is $23 million, or about a fourth of its original vision.
When asked about the accelerator, On Deck said it no longer has a regular accelerator. He unveiled a new vision for how to support early-stage startups—perhaps requiring less capital: Startups are now offered $25,000 for 1% or up to 2.5% ownership, compared to the startups’ previous deal. He offered $125,000 to the startup at 7%.
It may not have a $100 million fund to fuel its accelerator, but it has a corporate venture arm that it uses to market deals, now with mature founders who don’t like fixed contracts. “Most equity programs require founders to give up equity or take capital from a specific investor,” the spokesperson said in an email. “Many of our fellows are experienced and repeat founders who have been through traditional accelerators in the past and prefer our highly curated and unbiased program for founders in the early stages of their company’s formation. “
As On Deck has made these moves, Tiger Global has reportedly returned to the portfolio company by shelling out $5 million for the firm’s fund. On deck, instead of basing the entire future on an instant model, it’s returning to monetization programs.
“Tiger Global is a valued LP in our fund and firm. We have no further comment on this relationship,” a spokesperson said in an email.