- Investors have been cheering Pinterest, especially since it surpassed Snapchat to become the third-largest social media network in the US.
- But the idea-board company wasn’t seen as a competitive investment in its early days, according to Benchmark partner Sarah Tavel, who appeared as a guest on Angel, a podcast series hosted by Jason Calacanis to talk about her venture capital experience.
- Tavel said her firm at the time, Bessemer Venture Partners, was the only investor to offer a term sheet expressing interest in financing the Series A round.
- “It was the first moment where I realized being a woman could be an edge,” Tavel explained.
- Pinterest went on to raise a total of $1.5 billion in funding over 18 rounds, and eventually made its debut on the public market in April last year.
- Visit Business Insider’s homepage for more stories.
Investors have been cheering the Pinterest, the idea-board company that overtook Snapchat in popularity last year and became the third-largest social media network in the country.
But one of its earliest investors says that venture capital firms in Silicon Valley had initially failed to understand the company, which became one of Silicon Valley’s better-performing unicorn IPOs on the stock market last year.
Benchmark partner Sarah Tavel appeared as a guest on Angel, a podcast series hosted by Jason Calacanis to talk about her experience in the Silicon Valley ecosystem, the venture capital firms she’d previously joined, and her early experiences as a tech investor.
Tavel considers Pinterest a milestone in her investment career, because she was one of the first investors to grasp the full potential of the website.
At the time, Pinterest was still less than a year old. It had 4-5 members, around 30,000 users, and as an early user of the product who “just loved it,” Tavel expected Silicon Valley venture firms would be buzzing about it.
“I thought it was the most competitive deal ever, like I just assumed it would have multiple term sheets,” Tavel said. As a result, Tavel pitched leading Pinterest’s Series A round to her firm at the time, Bessemer Venture Partners.
Only later did she find out that their company was in fact the only venture capital firm to offer Pinterest a term sheet.
“It was the first moment where I realized being a woman could be an edge,” Tavel explained.
“Pinterest was a product that none of the men got,” Tavel said, explaining that even its early days, the user retention rate was “undeniable,” and the usage rate of the site was “extraordinary.”
Those metrics helped Tavel convince Bessemer to lead the company’s Series A round in 2011. “Everywhere else, it was one of those things where people just thought it was going to be a real niche site,” she said.
Pinterest would go on to raise a total of $1.5 billion in funding over 18 rounds. It debuted on the stock market last year with a valuation of $10 billion, and its stock jumped 25% that day.
The company has continued to pick up momentum in the months since then. Most recently, it reported over $1 billion in sales through 2019, prompting CNBC’s Jim Cramer to say the company was “giving investors everything they want: strong revenue growth with steadily rising profitability.”
Join the conversation about this story »
NOW WATCH: Most maps of Louisiana aren’t entirely right. Here’s what the state really looks like.