I spent nearly 40 minutes on the phone yesterday with Adeo Ressi, or the artist formerly known as “Ted” of TheFunded.com. At issue was the column I wrote about his coming out party, which included some criticisms of both his event and his site. More constructive than contentious, which speaks to Ressi’s genuine desire to make TheFunded more than an aggregator for entrepreneurial gossip. Some notes:
* Ressi says that he removed the curtain because too many people knew his secret. “I had told a lot of people, which means it was bound to leak out… I thought it was best to come out on my own terms.”
* The site will soon include term sheet data, which will be submitted by entrepreneurs (company names redacted). Members will have to submit a term sheet in order to see others, but Ressi doesn’t expect that to be a problem. “The only time an entrepreneur cares about terms is when they’ve gotten a term sheet.”
* My main criticism was that the site’s rankings only use qualitative factors, which is how a new firm with no exits sits atop the list. Ressi isn’t entirely convinced this is a huge problem – under a theory that today’s top-rated firms with get better dealflow and, therefore, become tomorrow’s top-performers – but is clearly giving thought to addressing the issue. We tossed around some ideas, and wrestled with how to account for outliers (a fund whose performance is skewed by one huge win or loss) and new funds (should the aforementioned new fund be penalized just because of its age?). No concrete solutions yet, but I’d expect that there will be at some point soon.
* I told Ressi that something was missing from my original column, so let me share it now: Despite my criticisms, I would bet that TheFunded is acquired by a major business media company within two to three years. Maybe Daddy Thomson, maybe Dow Jones, maybe Forbes. Each of those companies has great exposure to the investor class, but much less to the entrepreneurial ranks (save for some sector verticals). It’s a big group, and TheFunded could provide a valuable gateway – not to mention an expansion of existing data products.