Richard Wolpert of Mail Room Fund: Part Deux

Yesterday, I chatted with Richard Wolpert, the affable managing director of the seed-stage Mail Room Fund — a joint venture by Accel Partners, Venrock, AT&T and talent agency William Morris. I posted part of our conversation yesterday. Below is more from that discussion.

Are you the only person involved in Mail Room Fund who would take a seat on a board?

I’m the managing director, but we have people dedicated at each of our investor firms who work on our deals. There are a couple of guys at William Morris who are involved on daily basis who I can easily imagine taking board seats. There are people at Venrock and at Accel who are involved, too, though I doubt they’d sit on a board [on behalf of Mail Room Fund]. Overall, we’re actually getting a tremendous amount of leverage — not just from the financial resources they’re dedicating but the staff. And it eliminates the need to build up a big organization.

You recently made your first investment in Sometrics, a company offering a free data analytics tool to the many developers focusing on social networks. Does that in any way suggest that you’re less interested in direct-to-consumer companies?

Not really. We’re still seeing plenty of very interesting opportunities in the consumer space, though you have to find a niche, and you have to find a company that can get distribution without having to buy it for a lot of money.

I’m guessing that’s grown tough, with so many look-alike companies out there. Are there some categories that you’re avoiding?

One category that’s extremely difficult because it’s highly competitive is aggregated video search. You have two or three dominant players and hundreds of companies trying to do the same thing.

We’re also leery of — and this will be controversial because of William Morris — but people who are trying to do original content for the Web, which will be a hits-based business, and is a market that I view as too premature and risky. One of out X million shows or series will be a success, but the rest will go nowhere, so that’s not something where we’ve seen something so unique or so solid that it’s we’re focusing on it.

That is interesting, especially when a lot of high-profile seed investors like Marc Andreessen and Ron Conway are backing related companies, like Eqal [producer of cult YouTube video series Lonelygirl15].

Well, with Ron and [his affiliate firm] Baseline Ventures, their strategy is to put to work relatively small amounts of money in dozens to hundreds of deals. We’re really going to do only the best deals we can find in southern California.

Meaning you’re happier to take a wait-and-stance?

No, I mean that we’re not operating at a particular pace. We don’t have an expectation that we’ll do X number of deals a year. We could do two this year; we could do eight. We did first deal in first 30 days of our existence, so we’ve shown we’re willing to move fast. But we haven’t found the right combination of deal and team to close on a second yet.

Any other categories that you’re shying from? Is there any way you could be convinced to back a new social network at this point?

No, in terms of a brand new one that will become a big business, I think that market has closed up. You’ve got several big successful audiences: MySpace, Bebo, Facebook. Then you have the tools to create niche social networks, thanks to KickApps and Ning. I just don’t see another play, though I do see tremendous business opportunities thanks to those companies. Sometrics is only interesting because application developers on social networks are doing so well.

What do you really like?

In terms of what we’re looking at, we’re paying attention to what’s being done for the iPhone — not just because we’re interested in the iPHone but we think what it’s done with the Web browsing experience on mobile phones, and just its [software developer kits] opens up the ability to more interesting things on mobile.

We also see as a big shining star ad businesses in one form or another. The dollars spent on an annual basis on TV print and radio are making a big transition to the Web, and a lot of people are still struggling to figure out how to make that transition. It’s a great opportunity, because you know the money, those budgets, are already there.

Honestly, though, what we’re looking for simply isn’t that concrete. We’re looking for a team that we can believe it and that has already received a respectable amount of traction for a small amount of investment. Sometrics had only received $300,000 prior to our investment, and it already had a team of 8 people, and 400 hundred people using its platform. We liked that a lot.