Cowboy Ventures

Cowboy Ventures is a small seed fund with an outsized name in Silicon Valley vocabulary. Its founder, Aileen Lee, is the investor who first called billion-dollar startups unicorns. Her firm works from an office on Lytton Avenue in downtown Palo Alto and does one thing: it leads seed rounds for software companies, often before they have a product. It is also one of the few firms that says outright that founders do not need a warm introduction to pitch.

This profile is a neutral explainer for visitors and founders. It is based on Cowboy's website and published reporting. For the basics of how venture funds work, see our venture capital guide.

Aileen Lee and the founding

Aileen Lee joined Kleiner Perkins in 1999 and spent 13 years there before leaving in 2012 to start Cowboy. TechCrunch reported on July 30, 2012 that she was raising a $40 million first fund, called Cowboy Capital Fund I, with Kleiner Perkins as the anchor investor. At that point $36 million had closed.

The name puzzled some observers at first. TechCrunch later added that Lee had explained on social media that Cowboy is her son's name. The firm now leans into the Western theme. Its values include "room around the campfire" and "ready to ride."

Lee is also a co-founder of All Raise, a nonprofit launched in 2018 by a group of more than 30 venture investors to increase the representation of women in venture capital and startups. In 2017 Ted Wang joined Cowboy as a general partner.

The unicorn article

In 2013 Lee wrote a TechCrunch article titled "Welcome To The Unicorn Club: Learning from Billion-Dollar Startups." She used unicorn to describe a privately held startup valued at $1 billion or more, a rare animal at the time. The word caught on. Within a few years it was widely used in venture capital and financial news.

The term now appears on firm websites, including several in this guide, as a measure of success. Our venture capital glossary defines it alongside other common terms.

The office at 525 Lytton Avenue

Cowboy's website lists a single office address: 525 Lytton Avenue, Palo Alto. Lytton runs parallel to University Avenue on the downtown grid, so the office is a short walk from the restaurants, cafes and coworking spaces where early-stage founders tend to work. The Palo Alto Caltrain station is within walking distance.

The office is private and meetings are by appointment. Our guide to downtown and University Avenue covers the surrounding blocks.

What Cowboy invests in

Cowboy's FAQ is specific about its target:

• Geography. US-based companies targeting US customers.
• Type. Software-oriented companies, both enterprise and consumer.
• Sectors. The website lists enterprise, fintech, dev tools and infrastructure, healthcare, consumer, future of work, vertical AI and security.
• Stage. Companies that have not yet raised a seed round. The firm says 70 percent of its investments are pre-product.
• Round size. Its sweet spot is leading or co-leading seed rounds, usually $1 million to $5 million in total.
• Check size. Its first investment is usually $500,000 to $4 million, with money held back for the Series A and later.

The firm adds that not having an investment in your category does not mean it is uninterested. It says it is open to "a wide array of software oriented technology."

How Cowboy evaluates companies

Cowboy describes its diligence around what it calls the four Ps: people, potential, product and plan. It looks for founders with a unique insight into a problem, a large and growing market, an obsession with product and customer experience and a plan to execute.

The firm lays out its process step by step:

1. It reviews any materials a founder shares before a first meeting.
2. After an initial meeting, partners spend more time with the founders and talk to people who know the space.
3. It may ask for customer or professional references.
4. The founder usually meets the whole team.
5. If there is a fit, the firm discusses terms and timing before sending a term sheet.

Cowboy says it keeps time free in its calendars each week so it can move quickly on new deals. Our term sheet basics page explains what a seed term sheet covers.

Support after the check

Seed investors differ a lot in how involved they are after a round closes. Cowboy describes itself as a hands-on partner and lists the areas where it says it helps most:

• Strategy, priorities and honest advice
• Go-to-market planning and customer introductions
• Hiring, HR and culture building
• Financial planning and benchmarking
• Storytelling, marketing and media relationships
• Preparing for the next round and meeting Series A investors

The firm says founders get access to the whole team rather than a single partner. It also stresses the emotional side of company building. In its FAQ it writes: "We don't want to hear that you are killing it. We want to know how you are doing."

A seed fund downtown

Cowboy is one of several investors that chose downtown Palo Alto over Sand Hill Road. Seed-stage companies are often a few people in a shared office or a coworking space. Being downtown puts the firm close to that world and to the Caltrain station. Our coworking and office space guide lists the shared workspaces nearby.

Notable investments

Cowboy features several portfolio companies on its website:

Published profiles of Lee also list investments made through Cowboy in Dollar Shave Club and Accompany. As with any seed fund, many companies in the portfolio will not reach a large outcome. Seed returns depend on a handful of breakout companies.

How founders reach Cowboy

Cowboy's answer is short. Its FAQ says founders "don't need a warm intro." The firm explains that while it appreciates the effort it takes to find a mutual connection, warm introductions "can make it harder for folks to get access to capital." It says it reviews and tries to respond to every cold inbound pitch sent to the general hello address listed on its website.

Our guides to seed and pre-seed funds and pitching investors cover the wider seed market and how to write a first email. For places to meet other founders downtown, see where founders meet.

Frequently asked questions