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Illustration: Sarah Grillo/Axios

Carey Smith founded a company, sold it for a ton of money and became a full-time venture capitalist. Pretty standard evolution. But that's where the ordinary ends.

The intrigue: Smith, who runs Austin-based Unorthodox Ventures, doesn't invest in software. He doesn't think entrepreneurs should give up much equity, and that they should seek to become profitable as soon as possible. He doesn't have return expectations, nor does he have interest in managing anyone else's money.

  • In short, he's an iconoclast in an industry that worships at the altar of pattern matching.

"I'm not a finance guy," says Smith, who bootstrapped Kentucky-based Big Ass Fans before selling it for $500 million to private equity firm Lindsay Goldberg.

  • "With the fan company we always said we had to make money to stay in business, but that wasn't our primary interest."

The backstory: Unorthodox Ventures includes many of his former Big Ass Fans colleagues — with expertise in areas like industrial engineering and marketing.

  • Its portfolio companies range from a startup that makes bidets to an underwater fishing camera to spiked seltzer. Plus, Awkward Essentials, which makes after-sex cleanup sponges.
  • Smith says he wishes there were more industrial manufacturing startups, but has struggled to find them.

Behind the scenes: "Sometimes it's a good idea that really needs help with engineering," says Smith, whose firm can invest up to $10 million per company.

  • "Some entrepreneurs have a tendency to outsource everything ... which can make quality control very difficult and, if you do it in China, you lose your IP rights."
  • He bristled when I asked why he doesn't just run a consultancy, given his philosophies on ROI and founder equity maintenance: "You can... get a prostitute or get married. They involve the same thing, but there's a difference in approaches. We want to be partners with our companies."

The bottom line: Smith's fan company was known for doing things differently, from compensation to pricing to where it manufactured its products. He's now carried that over to venture capital.

Go deeper

Why one startup CEO lets employees cash out every year

Illustration: Lazaro Gamio / Axios

Pipe, a marketplace for revenue-based lending, has started to let its employees sell some of their equity each year through company-managed secondary sales on the AngelList platform.

Why it matters: Shareholder liquidity continues to be a challenge for tech startups as companies remain private longer than ever before.

Updated 2 hours ago - World

Over 3,000 detained in protests across Russia demanding Navalny's release

Russian police officers beat protestesters at a rally against of jailing of oppositon leader Alexei Navalny in Moscow on Saturday. Photo: Mikhail Svetlov/Getty Images

Police in Russia on Saturday arrested more than 3,300 people as protesters nationwide demanded that opposition leader Alexey Navalny be released from jail.

Details: Demonstrations began in the eastern regions of Russia and spread west to more than 60 cities.

Updated 4 hours ago - Politics & Policy

Arizona Republicans censure Cindy McCain and GOP governor

Combination images of Cindy McCain and Gov. Doug Ducey. Photo: FilmMagic/FilmMagic for U.S.VETS/Michael Brochstein/SOPA Images/LightRocket via Getty Images

Arizona Republican Party members voted on Saturday to censure prominent GOP figures Cindy McCain, Gov. Doug Ducey and former Sen. Jeff Flake (R-Ariz.), who've all faced clashes with former President Trump.

Why it matters: Although the resolution is symbolic, this move plus the re-election of the Trump-endorsed Kelli Ward as state GOP chair shows the strong hold the former president has on the party in Arizona, despite President Biden winning the state in the 2020 election.