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Introducing Calm Company Fund

What is Calm Company Fund?

We invest in profitable, sustainable, calm businesses. We invest early in profitable businesses that want to maximize their chances of success and build for the long-term and retain control.

Who is Calm Company Fund?

Tyler Tringas, general partner (GP) at Calm, founded Calm Company Fund in 2018. The first check he wrote was in February 2019. We are now a fully remote team of eight people who love supporting and building calm businesses. You can find out more about all of us here.

What is a Calm Company?

Calm Companies grow sustainably in every sense of the word. They don't believe in hyper growth or nothing. They aim for profitability as soon as possible — their Plan A after raising from us is to get to break-even and grow the business through cashflows. They believe success shouldn't create detrimental social, environmental or team impact. Calm Companies build companies their own way and we love that.

Where are you based?

We can be found working remotely around the world — from Mexico City and London, to LA, New York and Montana and further. It's one of the reasons we are interested in remote tools for remote teams.

Who is Earnest?

You may have known us as Earnest Capital — we had a lot of fun with that name — but we decided we needed something new, a rallying cry to get behind, a name to reflect a new kind of a startup capital that aligns with the overwhelming majority of entrepreneurs who want to build sustainable profitable long-term focused businesses. You can read more about the change here.

Investment Questions

How do you invest?

We primarily invest on a rolling basis using a financing structure that we created called the Shared Earnings Agreement (“SEAL”) that allows us to back founders who want to build sustainable profit-focused businesses without the pressure of having to continually raise capital or sell.

What is a SEAL agreement?

Short for Shared Earnings Agreement, a SEAL is a financing structure created by us to invest into calm companies to create a win-win situation all round. It is not debt, doesn’t have a fixed repayment schedule, and doesn’t require a personal guarantee. Investors make an upfront capital investment and then are entitled to receive Shared Earnings which is a percentage of Founder Earnings (a mix of founder salaries, dividends and retained earnings). Shared Earning payments only kick in once founders are able to pay themselves at least the amount agreed before hand (we call this the Founder Earnings Threshold) — we want you to thrive not just survive! To understand more about SEALS, check this out.

Oh, so you're basically revenue-based financing?

Nope. But an easy mistake to make. Revenue-based debt products are repaid as a percent of top-line revenue. By using Founder Earnings plus a threshold, a SEAL is much closer to a profit-share. Investors expect a growth period after the investment before any Shared Earnings begin to be paid.

Are you making investments right now?

Yep. You can apply for funding here.

What is the ideal stage for investment?

We love bootstrapped companies! You've launched, have some paying customers, and some feedback. We don't invest in idea stage, pre-product companies — that is not our realm of expertise. We invest in MVPs, not proof of concepts. Loads more on this here.

What does a typical investment look like?

We invest between $75k – $250k and can lead rounds of $500k-$1m.

Where do you invest?

Currently, we are able to invest in the US, Canada, most of the EU, Australia and New Zealand. Probably a few other places. Apply for funding and we'll try and figure it out.

If you would like to start a US-based entity, our portfolio company FirstBase is the easiest way to launch a US LLC or C-Corp. Use the code “earnest” for $20 off.

Does my business need to be C-Corp, LLC, etc?

We have a preference for C-Corps and believe they are frequently the best option for founders as well, but LLCs are not a dealbreaker for us. We've invested in a number of non-US businesses and are happy to continue doing so. There is a little bit extra diligence and legal work required but it is truly just a little and not a big deal.

If you would like to launch a US C-Corp our portfolio company FirstBase is the easiest way to do that. Use the code “earnest” for $20 off.

What do I need to send you?

An application! Our custom application tool that lets you apply to us for funding at a pace that works for you. Check it out.

Do you cap my salary as a founder?

That is not our vibe. Our terms have something called a Founder's Earnings Threshold which is explained more here, but the gist of it is that founders have full control over their salary. It is actually a minimum earnings floor. The opposite of a cap.

What types of businesses are you looking for?

Our center of gravity is B2B software-as-a-service (SaaS). Recurring revenue, high margin, software businesses are our bread and butter and represent the bulk of our investments.

Some things we are particularly interested in right now are:

  • B2B SaaS targeting niches or specific industries
  • Developer tools
  • Remote tools for remote teams‍
  • Software that enables building online businesses
  • Online education and personal development communities, membership models, platforms

Read more about what we invest in.

Who have you invested in?

You can check out all of our investments here.


Do you provide mentorship?

Yes! We’ve put a ton of thought into structuring a mentorship program that listens to what founders need. You can learn more about it here.

What other support is there?

In no particular order: a Private Slack community of 200+ founders, mentors, and investors; closed-door tactical workshops led by operational experts limited to six companies at a time; exclusive partnerships with leading brands like AWS, Webflow, Notion, and more; community-wide licenses to books, courses, tools that our founders can use ad-hoc; operating playbooks designed to used off the shelf for key needs; personal "Calm Boards" comprised of knowledgeable mentors centered around your needs and ideas of success; and a lot more stuff.

is this stuff obligatory?

We treat you like grown-ups. Calm Company Fund is, at its core, a service business. Our job is to make world-class mentors available to you and provide you with as many helpful resources as we can...but we are not here to tell you how to run your business. We understand that everything we provide is optional — to earn the right to engage with you we are intentional about what we provide.

Every fund says they're founder friendly, why should I believe you?

We're not aiming to be founder friendly. We are founder aligned. You can check out what people are saying on our Wall of Love.

Calm Company Scouts

How to Scout

Where can I find companies to scout?

The whole point of Calm Company Scouts being open to all is because we know companies that are a fit for us can come from unexpected places. We can’t be everywhere — the communities and networks that you're operating in are your USP. In short, Calm Companies can be found everywhere and anywhere.

Where can the companies be based and what type of companies do they need to be?

This is an evolving answer. In an ideal world, we would be investing anywhere and everywhere. In practice, we are somewhat constrained. We definitely have a slight preference for US based corporate entities. We have expanded our scope of that to US, Canada, Australia, Singapore, UK, and most of the EU — we can work with any corporate entities in any of those regions and have made investments already in those spaces. We don't care where the founders are physically located.

What are the red flags I should be looking for?

We are looking for people that you trust, building brands that you personally would want to invest in. Ensuring that the product exists, that the revenue is actually associated with the product you’re scouting, and that you’re comfortable scouting that company. 

Also is the company values aligned with what we're trying to do, is this the right financing for them?

Can you share strategies on how to reach out to founders?

Ideally, you are recommending companies that you already know.
A message like “Hey Lisa, have you thought about investment from Calm Company Fund to get the company to sustainable growth? I know you’re not feeling the VC route...Happy to chat to you about it if you want more info,” should be enough.

As a company, why would I go through a Calm Company Scout and not directly?

If you already know about us and are ready to apply for funding, please do so! We go through every single inbound application. The value add for a company that comes through a scout is

  1. They may not have been aware of us beforehand.
  2. Scout endorsements from Calm Fund LPs and, over time, from "anyone who's successfully scouted deals for us in the past" will add extra weight to an application.
  3. If the scout writes an investment memo, it will provide extra validation for us to understand why the company is a good match. 

How many companies do you expect Calm Company Scouts to scout?

We have no expectations of how often a scout will scout a deal for us. We launched the Calm Company Scouts program at the beginning of November so we don’t have enough data yet to share how many are scouted.

If a scout hasn't been able to find any companies, what happens?

Nothing. There is no obligation or minimum number of companies you must refer to us. We will check in to see if you still want to be part of the program.

Investment Memo

Are you able to share a sample investment memo?

The best way to write us a memo is to answer the questions here — that will be the best guide for what we are looking for. 

At Calm Company Fund, we want to know some of the metrics that signal growth. We want to get an idea of the momentum of growth. A good example of this would be “MRR growth was averaging ~5% monthly from Sep 2020 – Jan 2021, but is averaging 11% monthly for the last 4 months which is around $900 in net new MRR each month”.

Do you look at each memo? Do you reply to all of them?

Yes, we definitely look at and reply to every memo sent our way. Response time is currently within a week but it will be vary depending on things like quantity of referrals and waiting on the companies themselves — sometimes, a memo comes in before the application from the company. The ideal order is the application comes in first, and then the memo arrives afterwards.

How quickly do you reply?

Response time is currently within a week but it can vary.

How much due diligence should the scouts be doing before submitting a memo?

If you’re asking if you should be reviewing financial statements, P&L sheets and things like that, the answer is almost always no. The time commitment to scouting should be proportional to the upside so you spending an entire week working on a deal doesn’t make sense. We’re looking for an understanding of the basic metrics of the company, so you can ask them ‘What is your recurring revenue? What's your churn?’ If it makes sense and sounds good to you, send it over. Our job is to check it all diligently.

What should be sent first; the memo from the scout or the application from the company?

The ideal order is the application comes in first, and then the memo arrives afterwards. We won’t reply to the scout until we’ve reviewed the company’s application.

Our relationship with Scouts

How will you keep me in the loop about a deal I’ve scouted?

It’s early days and we are currently working on figuring out what the process looks like. Watch this space. Right now, in your Scout profile, you can see if we have invested or not.

Are you providing feedback to Calm Company Scouts?

Yes, we are taking more time to provide feedback to those who write memos as we hope they will, in the future, be a bigger part of Calm Company Fund. We will let you know why the company you scouted isn’t for us so that you can start to iterate to find companies that fit our thesis. But also, this opens up a two way dialogue – if you think we’re wrong, convince us as to why this is something we should be investing in.

What is the contractual agreement between Calm Company Fund and a Calm Company Scout?

It’s as if you've done a one-off consulting project for us where you provided one off advisory services in diligence whilst recommending this one deal — you're not an employee and you don't necessarily have an ongoing relationship with us. We will wire success fees to the account you provide us with and it’s your responsibility to do the research needed on how to declare it which will depend on the jurisdiction you live in.

Can I co invest with Calm Company Fund?

We have not built something into the scout agreement yet but we are open to the discussion. Let us know in your memo that you’re also interested in investing alongside — this is also another great data point for us of your belief in a company. 

Can I invest my success fee from a deal?

If you write a memo, you have the option of a $5k check or carry in the deal. Having carry in the deal provides the same opportunity for upside, and downside, as if you had invested in the company directly

How quickly do you pay scouts?

As quickly as possible, within a week after making the investment is our goal.

Will I be given a Calm Fund email address?

No. As a Calm Company Scout you represent yourself, not Calm Company Fund or any of its affiliates.

How can the Scout community work together?

We’re looking into how we can support that. In the meantime, people are connecting already via Twitter, DMs, LinkedIn.