Speaker 1: M This is mesters in Business with Very Results on
Speaker 1: Bluebird Radio. This week on the podcast, I have an
Speaker 1: extra special guest. Her name is Soriah Durrabi. She is
Speaker 1: a venture capital and impact investor who has an absolutely
Speaker 1: fascinating background working for Verset with the New York Times
Speaker 1: social media group, then with a startup that eventually gets
Speaker 1: purchased by Open Table, and then becoming a venture investor
Speaker 1: that focuses on women and people of color lead startups,
Speaker 1: which is not merely a way to quote unquote do good,
Speaker 1: but it's a broad area that is wildly underserved by
Speaker 1: the venture community and therefore is very inefficient, meaning there's
Speaker 1: a lot of upside in this. You can both do
Speaker 1: well and do good by investing in these areas. I
Speaker 1: found this to be absolutely fascinating, and I think you
Speaker 1: will also if you're at all interested in entrepreneurship, social
Speaker 1: media startups, deal flow, how funds um identify who they
Speaker 1: want to invest in, what it's like to actually experience
Speaker 1: an exit as an entrepreneur, I think you'll find this
Speaker 1: to be quite fascinating. So, with no further ado, my
Speaker 1: conversation with t M VS Soriah Dorobi this is mesters
Speaker 1: in Business with very renaults on Bluebird Radio. My special
Speaker 1: guest this week is Soriah Darraby. She is the co
Speaker 1: founder and general partner of t m V, a venture
Speaker 1: capital firm that has had a number of exits despite
Speaker 1: being relatively young. Six of t MV startups are led
Speaker 1: by women or people of color. Previously, she was the
Speaker 1: co founder of food Spotting, an app named App of
Speaker 1: the Year by Apple and Wire that was eventually purchased
Speaker 1: by Open Table. Soriah Darabi, Welcome to Bloomberg. Oh my goodness, Barry,
Speaker 1: thank you for having me. I've been looking forward to
Speaker 1: this conversation since our previous discussion. We were on a
Speaker 1: Zoom call with a number of people discussing blockchain and
Speaker 1: crypto and it was really quite fascinating, and I thought
Speaker 1: you had such an unusual and interesting background. I thought
Speaker 1: you would make a perfect guest for the show. Let's
Speaker 1: start with you were manager of Digital Partnerships and Social
Speaker 1: Media at the New York Times when social media was
Speaker 1: really just ramping up. Tell us about what that was like. Well,
Speaker 1: tell us what you did in the late aughts at
Speaker 1: the Times. Oh. Absolutely, I was fresh faced at a University.
Speaker 1: A had recently graduated with mostly a journalism concentration from
Speaker 1: Georgetown and did a small stint conte Nast right around
Speaker 1: the time they acquired Reddit for what will soon be
Speaker 1: nothing because red it's expecting to i PO around fifteen
Speaker 1: billion and m that experience it read it really offered
Speaker 1: me um a decent understanding of convergence, you know, what
Speaker 1: was happening to digital media properties as they partnered for
Speaker 1: the first time with nascent but scaling social media platforms,
Speaker 1: and so The New York Times generously offered me a
Speaker 1: role that was originally called Manager of buzz Marketing I
Speaker 1: think that's what they called social media in two thousand
Speaker 1: and six, and then that eventually evolved into Manager of
Speaker 1: Digital Partnerships and Social Media, which in that sence meant
Speaker 1: that we were aiming to be the first media property
Speaker 1: in the world to partner with companies that our household
Speaker 1: named today but back in the day were fairly unknown
Speaker 1: to facebooks and the Twitters, of course, but also platforms
Speaker 1: that really took off for a while and then um plateaued,
Speaker 1: but potentially you know, the Tumblers of the world. And
Speaker 1: it was my responsibility to understand how we could effectively
Speaker 1: generate um an understanding of the thing demographics of these platforms,
Speaker 1: have a kid potentially bring income into The Times for
Speaker 1: working with them, but more importantly, how the journalists could
Speaker 1: authentically represent themselves on new mediums. And so that was
Speaker 1: a really wonderful role to have directly out of university.
Speaker 1: And then you know, introduced me to folks with whom
Speaker 1: I still work today. Huh. That's quite interesting. So when
Speaker 1: you're looking at a lot of these companies you mentioned
Speaker 1: Facebook and Twitter and Tumbler, um, how do you know
Speaker 1: if something is going to be a Facebook or my Space,
Speaker 1: a Twitter or a tumbler, what's gonna survive or not?
Speaker 1: When you're cutting deals with these companies on behalf of
Speaker 1: the Times, are you thinking in terms of, hey, who's
Speaker 1: going to stick around? That wasn't that much earlier that
Speaker 1: the dot com implosion took place prior to you starting
Speaker 1: with The Times. It's true, although I don't remember the
Speaker 1: dot com implosion. So maybe that naive Ka helped because
Speaker 1: all I had was enthusiasm, unbridled enthusiasm for these new companies,
Speaker 1: and I I operated then and now still with a
Speaker 1: data approach to business. You know, testing out new platforms
Speaker 1: and and trying to track the data. What scaling at?
Speaker 1: What velocity is this platform scaling? And can we hit
Speaker 1: your ride on a rocket ship if they will still allow.
Speaker 1: But a lot of our partnerships then and now as
Speaker 1: an investor are predicated upon relationships, and so you know,
Speaker 1: it's most I think terrific investors that I listened to
Speaker 1: who I listened to in your show, like at least
Speaker 1: we'll talk to you about the importance of believing in
Speaker 1: the founder and the founder's vision and um And that
Speaker 1: was the case back then, remains the case today. So
Speaker 1: when you were at the times you your tenure there
Speaker 1: very much overlapped the Great Financial Crisis. You're looking at
Speaker 1: social media? How did that manifest the world of social
Speaker 1: media when it looked like the world of finance was
Speaker 1: imploding at that time? Well, it was a very interesting time.
Speaker 1: I remember having quite literally thirty second meetings with certain
Speaker 1: um as. He would run upstairs to my floor and
Speaker 1: the eighth floor to talk about a deal book app
Speaker 1: that we wanted to launch, and then he would run
Speaker 1: back down to his death to do much more important work.
Speaker 1: I think um in in reviewing the financial crisis to
Speaker 1: the world. So thirty second meetings aside, uh, you know,
Speaker 1: it was considered to be in some ways a great
Speaker 1: awakening for the web two point oh era. Um, as
Speaker 1: the economy was bottling out like any recession, it also
Speaker 1: offered a really interesting opportunity for entrepreneurs, many of whom
Speaker 1: had just been laid off or um, we're looking at
Speaker 1: this as a sizeable moment to begin to work on
Speaker 1: a side hustle or a life pursuit. And so there's
Speaker 1: you know, it's unsettling, of course, any recession or any
Speaker 1: great awakening, but you know, lemonade lemons, when the opening
Speaker 1: door closing, there was a there was a true opportunity
Speaker 1: as well for social media founders, UH, founders focusing on
Speaker 1: convergence in any industry really, many of which were predicated
Speaker 1: in New York to begin, um, you know, tinkering on
Speaker 1: an idea that could ultimately become quite powerful. Because if
Speaker 1: you're at the earliest stage of the riskiest asset classing venture,
Speaker 1: there's always going to be seed funding for a great
Speaker 1: founder and a great idea. And so I think, um,
Speaker 1: some of the smartest people I've ever met in my life,
Speaker 1: I met at the onset of the aftermath of that
Speaker 1: of that particular era in time. So you mentioned side hustle. Um,
Speaker 1: Let's talk a little bit about food Spotting, which is
Speaker 1: described as a visual geolocal guide to dishes instead of restaurants,
Speaker 1: which which sounds appealing to me um and it was
Speaker 1: named app of the Year by both Apple and Wired.
Speaker 1: How do you go from working at a giant organization
Speaker 1: like The Times to a start up with you and
Speaker 1: a co founder and a handful of other coders working
Speaker 1: with you. Well, five or six minutes a week after
Speaker 1: my day job at the New York Times, I would
Speaker 1: go to networking events with technologist and entrepreneurs after hours.
Speaker 1: I saw that as as a priority UM to be
Speaker 1: able to partner from the earliest infancy with interesting companies
Speaker 1: for that media entity, I needed to at least know
Speaker 1: who these founders were in New York and Silicon Valley,
Speaker 1: and so, without a true agenda other than you know,
Speaker 1: keen curiosity to learn what these businesses were all about,
Speaker 1: I would go to the New York Tech meet Up,
Speaker 1: which Scott Hyperman of meetup dot com is now a
Speaker 1: cherished LP and my fund would create and back then
Speaker 1: the New York tech meet up with fewer than forty people.
Speaker 1: I believe it's in um, the tens of thousands now
Speaker 1: in New York City alone, and so UM it was
Speaker 1: there that I met some really brilliant people, and in
Speaker 1: a particular a gentleman my age who was building a
Speaker 1: cloud computing company that UM you know it was was
Speaker 1: essentially architraging aws to repopulate consumer facing UH cloud data
Speaker 1: services for enterprises BT BBC play and we all thought
Speaker 1: it would be Dropbox. UM the to be ultimately wasn't.
Speaker 1: But I will tell you the people whom I worked
Speaker 1: at that startup because I left the New York Times
Speaker 1: to join that startup, so this day remained some of
Speaker 1: the most successful people in Silicon Valley and Alley. And
Speaker 1: actually one of those persons is a partner at our
Speaker 1: firm now darsh and he was the co founder of
Speaker 1: that particular company which was called drop TODAYO. So I
Speaker 1: stayed there very quickly. I was there for that six months.
Speaker 1: But as that startup, I observed how a young person
Speaker 1: my age could build a business for his bc UH.
Speaker 1: He was the son of a VC and so he
Speaker 1: was exceptionally attuned to the changing landscape of venture and
Speaker 1: you know how to position the company so that it
Speaker 1: would be attractive to the ore ease of the world
Speaker 1: and the the b f j's and define those for
Speaker 1: us are pardon UM still today very relevant and very
Speaker 1: successful venture capital firms UM and in particular, they were
Speaker 1: backing a lot of the most interesting ideas and a
Speaker 1: whip two point out era when I joined this particular
Speaker 1: startup in in two thousand and ten. Well, that startup
Speaker 1: was acquired by Facebook and I often say no thanks
Speaker 1: to me, but the mafia that left that particular startup
Speaker 1: continues to this day to co invest with one another
Speaker 1: and help one another's idea succeed. And it was there
Speaker 1: that I began to build the confidence I think that
Speaker 1: I really needed to explore my own entrepreneurial ideas or
Speaker 1: to help accelerate ideas. And Food Spotting was a company
Speaker 1: that I was advising UM while at that particular startup
Speaker 1: that was really taking off. This was in the early
Speaker 1: days of when Instagram was still in data and we
Speaker 1: observed that the most commonly posted photos on Instagram were
Speaker 1: of food, and so by following that lead, we basically
Speaker 1: built an app around and activity that continues to take
Speaker 1: place every single day. I still see food photos on
Speaker 1: Twitter every time I opened up my stream and decided
Speaker 1: to match that with an algorithm that showed folks wherever
Speaker 1: they were in the world, and in Greece, I'm I
Speaker 1: want to Bendi Coopka, or I'm in Japan Okinawa. We
Speaker 1: helped people discover not just the Michel unrated restaurants or
Speaker 1: the most popular local kant in New York City, but
Speaker 1: rather what's good dish that they should be ordering. And
Speaker 1: then what the app was extremely good at was populating
Speaker 1: beautiful photos of that particular dish and then mirroring them
Speaker 1: with accredited reviews from the zagats to the world, but
Speaker 1: also popular celebrity chefs like Marcus Damilton in New York.
Speaker 1: And that's why we took off, because it was a
Speaker 1: cult beloved app of its time. Back when there were
Speaker 1: only three geolocation apps in the iTunes app store, it
Speaker 1: was We and Twitter and four Square, so there was
Speaker 1: a first move advantage. Looking back in hindsight, I think
Speaker 1: we sold that company too soon. Open Table bought the
Speaker 1: business a year and a half later, Priceline bought Open Table.
Speaker 1: Both were, you know, generous liquidity events for the founders
Speaker 1: that enabled us to become angel investors. But sometimes I
Speaker 1: wish that that app still existed today because I could
Speaker 1: see it being still incredibly handy in my day to
Speaker 1: day life, to say the least. So so did you
Speaker 1: have to raise money for um Foods spotting or did
Speaker 1: you just bootstrap it? And how did that experience compare
Speaker 1: with what that exit was like we did. We raised
Speaker 1: from tremendous investors like I didn't thinking of Felicia's Ventures,
Speaker 1: whom I think of as being one of the best
Speaker 1: angel investors of the world. He was on the board,
Speaker 1: but we didn't read that much capital before the business
Speaker 1: was ultimately sold. And what I learned in some of
Speaker 1: those early conversations, I would say, but may have ultimately
Speaker 1: led to l Oyes and term sheets, was that so
Speaker 1: much of m and as about whining and dining. And
Speaker 1: as a young person, particularly for me, you and I
Speaker 1: discussed before the show variable from New York. I am
Speaker 1: not from a business oriented family to say the least.
Speaker 1: My mom's in academic my father was a cab driver
Speaker 1: in New York City, and so there are certain elements
Speaker 1: of this game raising venture and ultimately trying to exit
Speaker 1: your company that you don't learn from a business book,
Speaker 1: and I think navigating that as a young person was complicated.
Speaker 1: If I had to speak economically, m quite quite fascinating.
Speaker 1: What is purposeful change? Well, the word purpose, I suppose,
Speaker 1: especially in the VC game, could come across as somewhat
Speaker 1: of a cliche, but we try to be as specific
Speaker 1: as possible when we allude to the impact that our
Speaker 1: investments could potentially make, and so specifically we invest in
Speaker 1: five verticals at our early stage New York City based
Speaker 1: venture fund. We invest in what we call the care economy,
Speaker 1: which is companies making all forms of care of elder
Speaker 1: care to pet care to healthcare more accessible and equitable.
Speaker 1: We invest in financial inclusion, so this is a spin
Speaker 1: on fintech. These are companies enabling wealth creation, education, and
Speaker 1: most importantly literate see for all. Something I think is
Speaker 1: really important the democratization as financed. We invest in the
Speaker 1: future of work, which our companies creating better outcomes for
Speaker 1: workers and employees alike. We invest in the future of work,
Speaker 1: which are companies creating better outcomes for workers and employers alike.
Speaker 1: We invest in purpose as it pertains to transportation, so
Speaker 1: not immediately intuitive, but companies creating transparency and efficiency around
Speaker 1: global supply chain and mobility. I can talk about why
Speaker 1: we pick that category in a bit. And sustainability to
Speaker 1: tech enabled sustainable solutions. This is our companies optimizing for
Speaker 1: sustainability from process through product. With these five verticals combined,
Speaker 1: we have a sub species, which is that diverse founders
Speaker 1: and diverse employee bases and diverse cap tables is not charity.
Speaker 1: It's simply good for business. And so in addition to
Speaker 1: being hyper specific about the impact in which we invest,
Speaker 1: we also make it a priority and a mandate at
Speaker 1: our firm to invest in the way the world truly looks.
Speaker 1: And when we say that on our website, we linked
Speaker 1: a census data and so we invest in men and
Speaker 1: women equally. We invest in diverse founders almost all of
Speaker 1: the time, and um we track this with data and
Speaker 1: precision to make sure that our investments reflect not just
Speaker 1: one zip code in California, but rather America at large.
Speaker 1: And you have described this as non obvious founders. Tell
Speaker 1: us a little bit about that phrase. Well, not obvious
Speaker 1: is a turn you hear a lot when you go
Speaker 1: out to Silicon Valley and uh, I don't know. I
Speaker 1: think it was coined by a well known early Kapal
Speaker 1: employee turned billionaire turned investor who actually have a conference
Speaker 1: centered around non obvious idea And I love the phrase.
Speaker 1: Um I love thinking about you know, investment PC that
Speaker 1: our countrary because when you have a contrary point of view,
Speaker 1: contrarion point of view, you often have outlier results because
Speaker 1: if you're right, you're taking the risk and you're capturing
Speaker 1: the reward. When you're investing in non obvious founders, it
Speaker 1: should be that exact, exact, same outcome. And so it
Speaker 1: always sort of befuddled me as a person with hard
Speaker 1: to pronounce name in Silicon Valley. Why it was that
Speaker 1: we're an industry that prides itself on investing in innovation
Speaker 1: and groundbreaking ideas and the next frontier of X, Y
Speaker 1: and Z, and yet all of those founders in which
Speaker 1: we were investing collectively tended to kind of look at
Speaker 1: the same They were coming from the same schools and
Speaker 1: the same types of families, and so to me, there
Speaker 1: was nothing innovative at all about backing that Wharton g
Speaker 1: SB HBS guy who was second or third generation finance.
Speaker 1: And what really excites me about venture is, you know,
Speaker 1: capturing a moment in time that's young, but also the
Speaker 1: energy is palpable around not only the idea in which
Speaker 1: the founder is building, but the categories in which they're tackling.
Speaker 1: And then that sounds vague. I'll be a little bit
Speaker 1: more specific, and so at t MV we try to
Speaker 1: see things before they're even coming around the bend. For instance,
Speaker 1: we were early investors in a company called city Blockhealth,
Speaker 1: which is offering best in class healthcare specifically for low
Speaker 1: income Americans. So they focus on the most most vulnerable
Speaker 1: populations which are underserved with healthcare, and they're offering them
Speaker 1: best in class healthcare access at affordable pricing because it's
Speaker 1: predominantly covered through pay A relationships. And this company is
Speaker 1: so powerful to us for three three reasons because it's
Speaker 1: not simply offering how health care to the elite. It's
Speaker 1: democratizing access to care, which I think is absolutely necessary
Speaker 1: and turnamount for success of any kind. We thought this
Speaker 1: was profoundly interesting because the population which they serve is
Speaker 1: also incredibly diverse, and so when you look at that
Speaker 1: investment over say a comparable company I won't name, means
Speaker 1: that offers for profit health care out of pocket. You
Speaker 1: can see why this is an opportunity that excites us
Speaker 1: as impact investors, But we don't see the diversity of
Speaker 1: the team as impact. We actually see that as their
Speaker 1: unfair advantage because they are accessing the population authentically that
Speaker 1: others might ignore. Let me see if I understand this correctly.
Speaker 1: When you talk about non obvious fine founders and spaces
Speaker 1: like this, what I'm hearing from you is you're looking
Speaker 1: at areas where the mare kid has been very inefficient
Speaker 1: with how it allocates capital. That these areas are just
Speaker 1: overlooked and ignored. Hey, if you want to go into
Speaker 1: Silicon value and compete with everybody else and pay up
Speaker 1: for what looks like the same old startup, maybe it'll
Speaker 1: be successful, maybe it won't. That's hyper competitive and hyper efficient.
Speaker 1: These are areas that are just overlooked and there is
Speaker 1: This is more than just do good ay for lack
Speaker 1: of a better word, There are genuine economic opportunities here
Speaker 1: with lots of potential upside. Absolutely. Um So, my business
Speaker 1: partner and I, you know, she and I found each
Speaker 1: other twenty years ago with undergrads at Georgetown, but we
Speaker 1: went into business after she was successful and being one
Speaker 1: of the only women in the world to take a
Speaker 1: shipping business public with her family and and we got
Speaker 1: together and we said, we have really unique access. She
Speaker 1: and I um and the first STV that we collaborated
Speaker 1: on back in Keen was for a young business at
Speaker 1: the time started by two women that was focused on
Speaker 1: medical apparel predominantly for nurses. Now it's nurses and doctors,
Speaker 1: and they were offering a solution to make medical apparels
Speaker 1: of scrubs more comfortable and more fashionable for nurses. I
Speaker 1: happen to have nurses and doctors in my family, so
Speaker 1: doing due diligence for this business was relatively simply called
Speaker 1: my aunt who's nurse practitioner and nurse for life, and
Speaker 1: she said, uh, absolutely, when you're you know, working in
Speaker 1: a uniform at the hospital, you want something comfortable with
Speaker 1: extra pockets that makes you look and feel good. The
Speaker 1: VCS that they spoke to at the time, and they've
Speaker 1: been very public about this in the beginning. Anyway, we're
Speaker 1: less excited because they correlated this particular business with a
Speaker 1: fashion company. But if you look back at our original
Speaker 1: memo which I saved, it says figs now public on
Speaker 1: the New York Back Exchange, is a utility business. It's
Speaker 1: a uniform company that can verticalize beyond just medical apparel.
Speaker 1: And so we helped value that company at teen million
Speaker 1: back into two thousand and sixteen, and this year um
Speaker 1: they went public at a seven billion dollar market cap.
Speaker 1: And so what is particularly exciting for us, going back
Speaker 1: to that conversation around non obvious founders, is that particular business,
Speaker 1: BIGS was the first company in history to have two
Speaker 1: female co founders public. And when we think of success
Speaker 1: at t MP, we don't just think about financial success
Speaker 1: and I are are you know, cash on cash return
Speaker 1: for our LPs. Of course we think about that, but
Speaker 1: we also think who are we cheerleading and with whom
Speaker 1: do we want to go into business and what's the
Speaker 1: story on the other side of the sense that we
Speaker 1: want to tell And uh, you know, we measure non
Speaker 1: obvious not just based on gender or race, because I
Speaker 1: think it's a little too precise in some ways. Sometimes
Speaker 1: for non obvious is around geography. I was I'm calling
Speaker 1: you from Athens, as you know, and in Greece yesterday
Speaker 1: I got together with a fund manager. I'm lucky enough
Speaker 1: to be An LP and her fund, and she was
Speaker 1: talking about the average size of a seed round in
Speaker 1: Silicon Valley these days, hovering around thirty millions. And I'm
Speaker 1: scratching my head because at our fund TNV, we just
Speaker 1: don't see that. You know, we're investing in Baltimore, Maryland,
Speaker 1: and in Austin, Texas, and the average price for us
Speaker 1: to invest the seed round is closer to five or
Speaker 1: six million, and so we actually can capture larger ownership
Speaker 1: of the pie early on and then developed a very
Speaker 1: close knit relationship with these founders that might not be
Speaker 1: as networked in the valley where there's thirty DC funds
Speaker 1: to everyone that exists in Austin, Texas. And so yeah,
Speaker 1: I think I think you're you're right to say that
Speaker 1: it's about inefficiencies in market, but also just around about
Speaker 1: you know, being persistent and looking where where others are
Speaker 1: not that that's quite intriguing. Your team is female lead.
Speaker 1: You have a portfolio of companies that's about six five
Speaker 1: women and people of color. Tell us how you go
Speaker 1: about finding these non obvious startups. That's a good question.
Speaker 1: You know. TMV celebrates its five year anniversary this year.
Speaker 1: So the way we go about finding companies now is
Speaker 1: a bit different than the way we begin five years ago.
Speaker 1: Now it's systematic. We collectively is a partnership. There are
Speaker 1: many of us take over fifty a month with tier
Speaker 1: one venture capital firms that have known us for a while,
Speaker 1: like the work that we do. Believe in our value
Speaker 1: add because the partnerships them prize to former operators, and
Speaker 1: so we really roll up our sleeves to help. And
Speaker 1: when you've invested with these firms enough times, they will
Speaker 1: write to you and say, I found a company that's
Speaker 1: a little too early for us for X, y Z reason,
Speaker 1: but it resonates and you know, I think it might
Speaker 1: be for you. So we found some of our best
Speaker 1: deals that day, but other times we found our deal
Speaker 1: flow through building our own communities. And so when I
Speaker 1: first started as a as a e M an emerging
Speaker 1: manager of a VC firm, and roughly of LP capital
Speaker 1: goes to e M each year. But that's sort of
Speaker 1: an outsized percentage because when you think about you know,
Speaker 1: the lea fixles of addition capital, taking one point three
Speaker 1: billion of that pie, then you recognize the definition of
Speaker 1: an emerging manager might need to change a bit um
Speaker 1: so when I was starting as an e M, I
Speaker 1: recognized that the landscape wasn't necessarily leveled. If you weren't
Speaker 1: what's called the spin out UM, somebody that has spent
Speaker 1: a few years at a traditional, established blue chip firm,
Speaker 1: then it's harder to, you know, develop and cultivate relationships
Speaker 1: with institutional LPs who will give you a shot, even
Speaker 1: though the data absolutely points to there being a real
Speaker 1: opportunity at capturing lightning in a bottle if you find
Speaker 1: the right e M with the right idea in the
Speaker 1: right market conditions, which is certainly what we're in right now.
Speaker 1: And so I decided to start a network specifically tailored
Speaker 1: around helping women fund managers connect to one another. And
Speaker 1: it began at the WhatsApp group and a weekly Google
Speaker 1: meet and has now blown into something that requires a
Speaker 1: lot of dedicated times. We're hiring an executive director for
Speaker 1: this group. It's called Transact Global UH two D fifty
Speaker 1: women X fund managers globally from Hong Kong to Luxembourg
Speaker 1: to Venezuela, Canada, um, Nigeria, you name it. There are
Speaker 1: women fund managers in our group and we have one
Speaker 1: of the most active deal flow channels in the world.
Speaker 1: And so two of our TMV deals over the last
Speaker 1: year a fintech company combatting student debt and helping young
Speaker 1: Americans day for retirement at the same time, as an example,
Speaker 1: came from this WhatsApp deal flow channel. So I think,
Speaker 1: you know, creating the community, being the change, so to speak,
Speaker 1: has been incredibly effective for us as a proprietary deal
Speaker 1: flow mechanism. And then last and not least, I think that,
Speaker 1: you know, having some sort of media presence really has helped.
Speaker 1: And so um, you know, I had posted a podcast,
Speaker 1: and I worked on building up what I think to
Speaker 1: be a fairly organic Twitter following over the years. And
Speaker 1: you know, we we surprise ourselves by getting some really
Speaker 1: exceptional founders called pitching us on LinkedIn and on Twitter
Speaker 1: because we make ourselves available as next gen e M.
Speaker 1: So that's that's a sort of long winded answer to
Speaker 1: your question, but it's not the traditional means to say
Speaker 1: the least are you the companies you're investing in? Are they?
Speaker 1: And and I'll try and keep the simple for people
Speaker 1: who are not all that world versed in the world
Speaker 1: of venture. Is it seed stage, is it the A round,
Speaker 1: the B round, how far into their growth process do
Speaker 1: you put money in, So it is a dominantly seed fund.
Speaker 1: We call our investments core investments. So these are checks
Speaker 1: that average between and one and one point five million,
Speaker 1: for about one point to five million on average, we're
Speaker 1: capturing ten to fiftent of a cap table and in
Speaker 1: this era that's called a seed ground. It would probably
Speaker 1: be called a series A ten years ago. And then
Speaker 1: we follow on through the Series A and it macs
Speaker 1: um take our pread at the B. So our goal
Speaker 1: by a Series B is to have on average ten
Speaker 1: percent at a cap. And then we give ourselves a
Speaker 1: little bit of wiggle room with our modeling. We take
Speaker 1: mars and moonshot investments with smaller checks, so we call
Speaker 1: these initial interest checks, and initial interest means I'm interested,
Speaker 1: but your idea is so audacious it won't prove itself
Speaker 1: up for three or four years. Or to be very honest,
Speaker 1: we weren't the first to get into this cap. Or
Speaker 1: you know you're picking us a court over us, and
Speaker 1: we understand, but let's see if we can just promise
Speaker 1: you a bit of value add to edge our way
Speaker 1: into your business. And oftentimes when you speak as a
Speaker 1: former founder yourself at a high level of compassion, and
Speaker 1: you promise with integrity that you're going to work very
Speaker 1: hard for that company. They will increase the size of
Speaker 1: their round and they will carve out space for you.
Speaker 1: And so we do those types of investments rarely ten
Speaker 1: times in any given portfolio. But what's interesting in looking
Speaker 1: back at some of our outliers from fund one, it
Speaker 1: came from those initial interest checks. So that's our model
Speaker 1: in a nutshell. We're pretty transparent about it. What we
Speaker 1: like about this model is that it doesn't make us tigers.
Speaker 1: Were off the board by the b but we're still
Speaker 1: owning enough of the cap table to be a meaningful
Speaker 1: presence in the founders live and in their business, and
Speaker 1: it allows us to feel like we're not spraying and praying.
Speaker 1: Spraying and praying is an amusing term, but I'm kind
Speaker 1: of intrigued by the fact that we used to call
Speaker 1: it's smart money, but you're really describing it as value
Speaker 1: added capital. When a founder takes money from t MV,
Speaker 1: they're getting more than just a check. They're getting the
Speaker 1: involvement from entrepreneurs who have been through the process from
Speaker 1: startup to capital raised to exit. Tell Us a little
Speaker 1: bit about how that works its way into the deals
Speaker 1: you end up doing, who you look at, and what
Speaker 1: the sort of deal flow you see is like. Well,
Speaker 1: years ago I had the pleasure of meeting a world
Speaker 1: class advertiser and I was at his incredibly fancy office
Speaker 1: down the wall street to that agency, and he described
Speaker 1: to me with pride how he basically bartered his marketing
Speaker 1: services for one percent of the unicorn and he was
Speaker 1: sort of showing off a bit about how for very
Speaker 1: little time and effort a few months he walked away
Speaker 1: with a relatively large portion of a business. And I thought, yes,
Speaker 1: that's clever, but for the founder, they gave up too
Speaker 1: much of their business to right And yeah, I came
Speaker 1: up with an idea that I floated by Marina back
Speaker 1: in the day where our original deck for TMV Fund
Speaker 1: one began with the slide marketing is the future of venture.
Speaker 1: Adventure is the future of marketing, meaning e f A
Speaker 1: VC fund were to position itself more like an ad agency,
Speaker 1: but rather than charging for its services, it's go to
Speaker 1: market services. You offered them free of charge, but then
Speaker 1: you were paid in equity and you could quantify the
Speaker 1: value that you were offering to these businesses, and back
Speaker 1: then people laugh at us, even though all around New
Speaker 1: York City ad agencies we're really doing incredible work and
Speaker 1: benefiting from the startups in that ecosystem. And so we
Speaker 1: sort of changed the positioning a bit and now we
Speaker 1: say to our LPs into our founders, you're both clients
Speaker 1: of our firm. So we do think of ourselves as
Speaker 1: an agency. But on one side of our marketplace you
Speaker 1: have LPs and what they want is crystal clear. The
Speaker 1: value that they derived from us is through community and
Speaker 1: connect ativity and co investment, and that's it. It's it's
Speaker 1: pretty cut and dry. Call me up once a year
Speaker 1: when you have an exceptional opportunity, let me invest alongside you.
Speaker 1: Invite me to dinners four times a year, give me
Speaker 1: some information and a point of view that I can't
Speaker 1: get elsewhere. Thank you for your time, and I love that.
Speaker 1: It's it's a great relationship to have with incredibly smart people.
Speaker 1: It's cut and dry. It's so different. What founders want,
Speaker 1: it's something more like a family. They want a VC
Speaker 1: on their board, you know that they can turn to
Speaker 1: during critical moments. Two am on a Saturday is not
Speaker 1: an uncommon time for me to get a text message
Speaker 1: from a founder saying what do I do? And so
Speaker 1: what they wanted more like seven services for a period
Speaker 1: of time, and they want to know when that relationship
Speaker 1: should start and finish. So it's sort of the Montessori
Speaker 1: approached adventure. We're going to tell them what we're going
Speaker 1: to tell them, tell them what they're telling them, tell
Speaker 1: them what they told them. We say to founders with
Speaker 1: a reverse pitch deck, so we pitch them as they're
Speaker 1: pitching us. Here's what we promised to deliver for you
Speaker 1: for the first each and twe four months of your infancy,
Speaker 1: and then we promise you will mostly get lost. You
Speaker 1: can come back to us when your business is growing
Speaker 1: if you want to do a tender and and we'll
Speaker 1: operate an SPV through you, or if you simply want advice.
Speaker 1: We're never going to ignore you. But our specialty are
Speaker 1: our black belt, if you will, bury is in those
Speaker 1: first twenty four months of your business that go to market.
Speaker 1: And so we've staffed up TNV to include, well, it's
Speaker 1: punching above our weight, but the co founder of an
Speaker 1: exceptionally successful consumer marketing business, a growth marketer, a recruiter
Speaker 1: who helps one of our portfolio companies higher forty of
Speaker 1: the earliest employees. We have a pr woman you've met
Speaker 1: the as she's exceptional, who whom I don't know how
Speaker 1: we would function sometimes because she's constantly writing and re
Speaker 1: editing Prince releases for the founders with which we work.
Speaker 1: And then u Anna our copywriter who came from I
Speaker 1: A C. And Sean our creative director, used to be
Speaker 1: the design director for Rolling Stone, and I could go
Speaker 1: on and on. So some firms called this a platform team,
Speaker 1: but we call it to go to market team. And
Speaker 1: then we promised a set number of hours for every
Speaker 1: company that we invested into that and as a result,
Speaker 1: UM No, that's just I'm I'm completely fascinated by that.
Speaker 1: Um But I have to ask, maybe this is an
Speaker 1: obvious question or maybe it's not. So you you sound
Speaker 1: very much like a non traditional venture capital firm. Who
Speaker 1: are your limited partners, who are your clients and what
Speaker 1: motivates them to be involved with TMV because it sounds
Speaker 1: so different than what has been a pretty standard model
Speaker 1: in the world of venture one that's been you know,
Speaker 1: tremendously successful for the top tier farms. Our LP set
Speaker 1: is UM crafted with intention. It's of our investors are institutional.
Speaker 1: This concludes institutional sized family offices, the family offices, and
Speaker 1: the multi billions UM. We work with three major banks
Speaker 1: fort of five hundred banks. We work with a couple
Speaker 1: of corporate fortune five hundreds as investors or LPs, and
Speaker 1: a couple of fund of funds, so that that's really
Speaker 1: run of the mill for fifty of our investors. And
Speaker 1: that's why I'm in Athens today. Our family offices global
Speaker 1: family offices that I think are reinventing what venture is
Speaker 1: going to look like in the future because wealth has
Speaker 1: never been greater globally, there's a trillion dollars of assets
Speaker 1: that are passing through the hands of one generation to
Speaker 1: the next. And what's super interesting to me as a
Speaker 1: woman is that historically a lot of that asset transfer
Speaker 1: was from father to son, but actually, for the first
Speaker 1: time in history, over fifty of those assets inheritors actually women.
Speaker 1: And so, as my business partner could tell you, because
Speaker 1: Sheet herself as the next gen. In prior generations, women
Speaker 1: were encouraged to go into the philanthropic or nonprofit side
Speaker 1: of the family business, and the sons were expected to
Speaker 1: take over the business with a family office, and all
Speaker 1: of that is just comple weekly turned around in the
Speaker 1: last ten years. And so my anchor investor is actually
Speaker 1: a young woman. She's under the age of thirty five.
Speaker 1: There's a little bit of our firm that's Indie rock
Speaker 1: because we're not playing by the same rules of the
Speaker 1: establishment is played by. But certainly we're posturing ourselves to
Speaker 1: be able to grow into a blue chip firm, which
Speaker 1: is why we want to maintain that balance of fifty
Speaker 1: percent institutional and fifty percent. I would call it the
Speaker 1: spoke capital. And for the LPs that are the spoke,
Speaker 1: we work with an Australian family office, and UM Venezuela
Speaker 1: and family office, and the Chilean family office, and a
Speaker 1: Mexican family office, and and and so on. For those
Speaker 1: family offices, we come to them, We invite them to
Speaker 1: events in New York City, We give them personalized introductions
Speaker 1: to our founders, and we get on the phone with
Speaker 1: them whenever they'd like. We host zooms. We call them
Speaker 1: the Future of Everything series. They can learn from us
Speaker 1: and we get to know them as human beings. And
Speaker 1: I think that there's a reason why UM two thirds
Speaker 1: of our Fund one LPs converted over into Fund two
Speaker 1: because they like that level of access. It's what the
Speaker 1: modern LPs is really looking for. Let's talk a little
Speaker 1: bit about some of the areas that you find intriguing.
Speaker 1: What sectors are really capturing your attention these days. What
Speaker 1: are you most excited about. Well, there i am. I'm
Speaker 1: most excited about five categories for which we've been investing
Speaker 1: for for quite some time, but they're really being accelerated
Speaker 1: due to pandemic and um a looming recession, and so
Speaker 1: we're particularly fascinated by not just health care investing has
Speaker 1: it been called in the past, but rather the care economy.
Speaker 1: I'm not a huge fan of the term fem tech.
Speaker 1: It always sounds like fembot to me. But care as
Speaker 1: it pertains to women alone is a multi trillion dollar opportunity.
Speaker 1: And so when we think of the care economy, we
Speaker 1: think of healthcare care, elder care, community care, personal care
Speaker 1: as it pertains to young people, old people, men, women, children.
Speaker 1: We buy for CAPE and we look for interesting opportunities
Speaker 1: that don't exist because they've been undercapitalized and undervalued for
Speaker 1: so long. Cave in point, we were early investors in
Speaker 1: kind body, a reproductive healthcare company focused on women who
Speaker 1: want to preserve their fertility, because if you look at
Speaker 1: twenty ten cents is data, you can see that the
Speaker 1: data has been there for some time that women in
Speaker 1: particular were glaying marriage and childbirth. And there are a
Speaker 1: lot of world famous economist who will tell you this.
Speaker 1: You know, the global population will decline because we're aging
Speaker 1: and we're not necessarily having as many children as we
Speaker 1: would have in the past. Plus it's expensive, and so
Speaker 1: we saw that as investors as a really interesting opportunity
Speaker 1: and UM jumped on the chance to back China Bartosi,
Speaker 1: who's incredible when she came to us with a way
Speaker 1: to make fertility preservation less expensive. So she followed the
Speaker 1: DTC playbook and she started with a mobile clinic UM
Speaker 1: that helped women freeze their eggs etensively. That company has
Speaker 1: gone on to raise hundreds pretty and that company is
Speaker 1: now valued in the hundreds of millions UM. And for us,
Speaker 1: you know, it was as simple as following our intuition
Speaker 1: as women fund managers. Now we know what our tears
Speaker 1: are thinking about because we talked to them all the time.
Speaker 1: And uh, and I think the fact that you know,
Speaker 1: we're bringing a new perspective to venture means that we're
Speaker 1: also bringing a new perspective to what has previously been
Speaker 1: called STEMPEC. We invest in financial inclusion. Everyone in the
Speaker 1: world is investing in fintech um the self directed financial
Speaker 1: mobile apps are always going to be capitalized, especially in
Speaker 1: a post Robin Hood era. But we're specifically interested in
Speaker 1: the democratization of access to financial information. And we're specifically
Speaker 1: interested in student debt um and alleviating students debt in
Speaker 1: America because not only is it going to be one
Speaker 1: of the greatest challenges are our generation will have to overcome,
Speaker 1: but it's also you know, prohibiting us from being out
Speaker 1: the American dream. One point seven trillion dollars a student
Speaker 1: that in America that needs to be alleviated. And then
Speaker 1: we're interested in the future of work and long have been.
Speaker 1: This certainly was very much accelerated during the pandemic, but
Speaker 1: we've been investing in the ten economy and remote work
Speaker 1: for quite some time and so really proud to have
Speaker 1: been the first check into a company called Braveley, which
Speaker 1: is an HR chatpot that helps employees inside of a
Speaker 1: company chat anonymously with hr reps outside of that company.
Speaker 1: So that's ten ninety fine about issues like the EI
Speaker 1: and inclusion and upward mobility and culture setting and what
Speaker 1: to do when you're all of a sudden working from home.
Speaker 1: So that's an example of a future of work business.
Speaker 1: And then in the tech enabled sustainable solutions category, it's amountful.
Speaker 1: So let's call that sustainability. We are proud who have
Speaker 1: been early investors in a company called Riddwell out of Seattle, Washington,
Speaker 1: focused on not just private privatized recycling, but upcycling and reconnaissance.
Speaker 1: Where are our things going when we recycle them? You know,
Speaker 1: for me, always been a pretty big question. And so
Speaker 1: Ridwell allows you to re and up cycle things that
Speaker 1: are hard to get rid of that of your home,
Speaker 1: like children's eyeglasses and paint, battery and you know, single
Speaker 1: use plastic, and it shows you where those things are going,
Speaker 1: which I think is super cool and there's good reason
Speaker 1: why it has one of the highest MPs scores net
Speaker 1: promoter scores of any company either were worked with people
Speaker 1: are craving this kind of modern solution. And last but
Speaker 1: not least, we invest in transportation in part because of
Speaker 1: the unfair advantage my partner, Marina brings to t MV.
Speaker 1: She comes from a maritime family, and so we can
Speaker 1: pilot transportation technology within her own ecosystem. That's pretty great.
Speaker 1: But also because we're just fascinated by the fact of
Speaker 1: the world commodities move on ship and the biggest contributor
Speaker 1: to emissions in the world outside of you know, corporate
Speaker 1: is coming from transportation, and so if we can sort
Speaker 1: of figure out this industry, we can solve a lot
Speaker 1: of the problems that our generation are inheriting. Now, these
Speaker 1: categories might sound massive, and we do consider ourselves a
Speaker 1: generalist firm, but we stick stick to five core sectors
Speaker 1: that we truly believe in, and we give ourselves room
Speaker 1: to kick out a sector or to add a new
Speaker 1: one with any given new fund. For the most part,
Speaker 1: we haven't needed to because these remain the categories that
Speaker 1: are not only most appealing to us as investors, but
Speaker 1: I think paramount to our generation. That's that's really intriguing.
Speaker 1: Give us an example of a moon shot, or what
Speaker 1: you called earlier a mars shot, a technology or a
Speaker 1: company that can really be a game changer but may
Speaker 1: not pay off for for quite a while. We just
Speaker 1: backed a company that is focusing on uh food science.
Speaker 1: Oh gosh, I can't really too much because they haven't
Speaker 1: they haven't truly launched in the US, but maybe maybe
Speaker 1: I'll kind of allude to it. They use crushed produce
Speaker 1: like crushed potato skins to make plastic but biodegrades. And
Speaker 1: so it's a Mars shot because it's a materials business
Speaker 1: and it's a food science business rolled up into both
Speaker 1: a CpG business and enterprise business. This particular material can
Speaker 1: wrap itself around industrial plates. Even though it's audacious, it's
Speaker 1: not really a Mars shot when you think about the
Speaker 1: way the world is headed. Everybody wants to figure out
Speaker 1: how do we consume less plastic and recycle plastic better.
Speaker 1: And so if there are new materials out there that
Speaker 1: will not only disintegrate but also in some ways feed
Speaker 1: if the environment, it would be a no brainer. And
Speaker 1: then if you add to the equation the fact that
Speaker 1: it could be maybe not less expensive, but of comparable
Speaker 1: pricing to be alternative. I can't think of a company
Speaker 1: in the world that wouldn't switch to this solution. This
Speaker 1: is plastic that you don't throw away, you just toss
Speaker 1: in the garden and it becomes exactly exactly it should
Speaker 1: help your guard and grow. Um. So yeah, so that
Speaker 1: that's what I would call them mars shot in some ways,
Speaker 1: but in other ways, it's just common sense. Right. So,
Speaker 1: so let's talk a little bit about your investment vehicles,
Speaker 1: you guys run. I want to make sure I get
Speaker 1: this right to funds and three vehicles. Is that right?
Speaker 1: We have two funds. They're both considered micro funds because
Speaker 1: they're both under a hundred million, and then we operate
Speaker 1: in parallel four SPVs UM that are relatively evergreen and
Speaker 1: they serve as opportunistic investments to continue to double down
Speaker 1: on our winners. SPVs special purpose investment vehicles. Yes, in
Speaker 1: in UM the PE world, they're called side cars. That's
Speaker 1: that's that's really interesting. UM. So how do these get structured?
Speaker 1: Does everything look very similar? UM? When you have a fund,
Speaker 1: how quickly do you deploy the capital? And typically how
Speaker 1: long are you locked up? For our investors luck up?
Speaker 1: For well, investors are usually in private equity or we
Speaker 1: see funds locked up for ten years. That's not unusual. UM.
Speaker 1: We have shown liquidity faster, certainly for fund one, it's
Speaker 1: it's well in the black and uh and it's only
Speaker 1: five years old, less four and a half years old.
Speaker 1: So um, you know how do we make money. We
Speaker 1: charge standard fees two on twenties is you know, the
Speaker 1: rout brick that we operate by, and then lesser fees
Speaker 1: for sidecars or direct investments. So that's that's kind of
Speaker 1: how we stay in business. When you think about an
Speaker 1: emerging manager starting their first fund, you know, management fees
Speaker 1: are certainly not so we can live a lavish rock
Speaker 1: and world life on the ten million dollar fund with
Speaker 1: a two percent management. See, you're talking about two k
Speaker 1: for the entire business to operate. So Marina and I
Speaker 1: not only you know, anchored our first fund with our
Speaker 1: own capital, but we didn't pay ourselves for four years.
Speaker 1: It's not glamorous. I mean there's some friends of mine
Speaker 1: that think the venture capital life is glam and it
Speaker 1: is if you're on Sandhill Road, But if you're an
Speaker 1: e M, it's a lot more like a startup where
Speaker 1: you're burning the midnight oil. Um, you are bartering favors
Speaker 1: with your friends, and you are begging the smartest people
Speaker 1: you know to take a chance on you and to
Speaker 1: invite you into their cap table, but it somehow works
Speaker 1: out because we do put in that extra effort. I think.
Speaker 1: I think the metrics, certainly for Fund one, have have
Speaker 1: shown us that you know, we're in this for the
Speaker 1: long hall now, so you have FUN one and FUN too.
Speaker 1: Are there any plans of launching Fund three? Yes? Um,
Speaker 1: I think that you know, given the proof points between
Speaker 1: Fund one and Fund two, um, and a conversation that
Speaker 1: my partner and I recently had, you know, five years
Speaker 1: out early in this do we love this? We do? Okay,
Speaker 1: this is our life's work. So you can see larger
Speaker 1: and more demonstrable sized funds, but not in an outsized way,
Speaker 1: not just because we can raise more capital now, but
Speaker 1: because we want to build out a partnership and the
Speaker 1: kind of culture that we always dreamed of working for
Speaker 1: back when we were employees. So we have a very
Speaker 1: diverse instead of colleagues with whom we couldn't operate. And
Speaker 1: we'll be adding to the partnership in the next two
Speaker 1: or three years, which is really exciting to say. UM.
Speaker 1: So yes, the T and V will be around for
Speaker 1: a while. That that's really interesting. I'm going to ask
Speaker 1: you the question I ask any venture capitalists that I interview.
Speaker 1: Tell us about your best and worst investments, and what
Speaker 1: did you pass on that perhaps you wish you didn't.
Speaker 1: Oh gosh, the film all list is so long and
Speaker 1: so embarrassing. UM, let me start with with you know
Speaker 1: what I passed on that I regret. Well, I don't
Speaker 1: know if she really would have invited me to invest,
Speaker 1: but only I had a wonderful conversation with a peer
Speaker 1: from high school, Katrina Lake, when she was in beta
Speaker 1: mode for spitch Fix. I think she was still at
Speaker 1: HBS at the time or had just recently graduated from Harvard,
Speaker 1: and Katrina and I had coffee in Minneapolis, where we
Speaker 1: went to high school, and she was telling me about
Speaker 1: the Netflix for clothing that she was building, And certainly
Speaker 1: I regret um not really picking up on the clues
Speaker 1: that she was offering in that conversation. UM, ditch Fix
Speaker 1: had an incredible IPO and I'm a proud shareholder today.
Speaker 1: And UM. Similarly, when uh, my friends were starting cloud Flare,
Speaker 1: which luckily they did bring me into pre I PO
Speaker 1: and I'm grateful for that. But when they were starting
Speaker 1: cloud Flare, I really should have jumped on that moment
Speaker 1: or UM when my my buddy Ryan Graves, whom I
Speaker 1: still chat with pretty frequently, UH was starting out uber
Speaker 1: in beta with Travis and Garrett as another opportunity that
Speaker 1: I definitely missed. UM I was in Ireland when this
Speaker 1: year is a term sheep assigned. So there's such a
Speaker 1: long laundry list of name dropped, name dropped, missed, missmissed.
Speaker 1: But in terms of what I'm proud of UM, I'd
Speaker 1: say far more. You know, I don't like Sophie's choice.
Speaker 1: I don't like to cherry pick the certain investments to
Speaker 1: just brag about them. But we've we've talked about someone
Speaker 1: the call today, I'd rather kind of shine a light
Speaker 1: look at my track record. Right there's there's a large
Speaker 1: realized I r R that I'm very proud of. But
Speaker 1: more on the opportunity of the companies that we more
Speaker 1: recently act Preventive, which is a CRM for oncology patients
Speaker 1: that helped them navigate through the most strenuous time of
Speaker 1: their lives and by doing so, get better access to healthcare.
Speaker 1: You know, we just wrote that check a couple of
Speaker 1: months ago, but already it's becoming a company that I
Speaker 1: couldn't be more excited about because if they execute the
Speaker 1: way I think surely and Victor will, this has the
Speaker 1: power to help so many people in you know, profound way,
Speaker 1: not just in the Silicon Valley cliche way of this
Speaker 1: could change the world, but this could actually, you know,
Speaker 1: help people receive better care. UM. So so yeah, so
Speaker 1: I'm I'm I'm proud of having been an early investor
Speaker 1: in you know, the Caspers of the world. Certainly we're
Speaker 1: all getting better sleep. There's no shame there. But I'm
Speaker 1: I'm really excited now today and investing in financial inclusion
Speaker 1: in the care economy and so on. M And let's
Speaker 1: talk a little bit about impactful companies. Is there any
Speaker 1: different when you're making a seed stage investment in a
Speaker 1: potentially impactful company versus traditional startup investing. Well, pre seed
Speaker 1: and seed investing UM isn't a science, and it's certainly
Speaker 1: not a science that anyone has perfected. There are people
Speaker 1: who are incredibly good at it because they have a
Speaker 1: combination of luck and access. But if you're a discipline
Speaker 1: investor in any such class. And I talked to my
Speaker 1: friends who were in hedge funds and work for hedge
Speaker 1: funds about you know, the ten bets that they take
Speaker 1: a day, and I think that's a lot trickier than
Speaker 1: what I do. Because our due diligence process, on average,
Speaker 1: picks an entire quarter of a year. We're not making
Speaker 1: that many investments each year. So even though it sounds
Speaker 1: sort of fruity when you look at a white combinator
Speaker 1: your demo day, why Com is, you know, the biggest
Speaker 1: accelerator in Silicon Valley, and they produce over three D
Speaker 1: companies three or four times a year. When you look
Speaker 1: at the outsized valuations coming out of why Com, it's
Speaker 1: easy to think that starting company is as simplest sort
Speaker 1: of downloading a company in a box Excel and and
Speaker 1: and running with it. But from where we sit, you know,
Speaker 1: we're scorching the earth for really compelling ideas in areas
Speaker 1: that have yet to converge. And we're looking for businesses
Speaker 1: that may have never pitched a VC before. Maybe they're
Speaker 1: not even seeking capital. Maybe it's it's a company that
Speaker 1: you know, isn't so interested in raising a penny of
Speaker 1: venture because they don't need to. They're profitable from day one.
Speaker 1: Those are the companies that we find most exciting because
Speaker 1: as former operators. We know how to appeal to them,
Speaker 1: and then we also know how to work with them.
Speaker 1: M hm, that's really interesting. Before I get to my
Speaker 1: favorite question, let me just throw you a curveball. Tell
Speaker 1: me a little bit about business school. The podcast you
Speaker 1: hosted for quite a while, So Synchrony thanks Um came
Speaker 1: to me a few years ago with a very compelling
Speaker 1: and exciting opportunity to host a podcast with them that
Speaker 1: allowed me a fortunate opportunity to travel the country. I
Speaker 1: went to just under a dozen cities to meet with
Speaker 1: founders who have persevered past their startup pace. And what
Speaker 1: I loved about the concept of business school is that
Speaker 1: the seasons that I hosted were really focused on founders
Speaker 1: who didn't have access to BC capital. They put money
Speaker 1: on credit cards or took out SBA loans or you
Speaker 1: know as friends and family to give them starter capital,
Speaker 1: and then they made their business work through trying times.
Speaker 1: And when you passed a five year marks for any business,
Speaker 1: I you know, I'm passing it right now for t
Speaker 1: n B, there's a moment of reflection where you can say, wow,
Speaker 1: I did it. You know it's it's incredibly difficult to
Speaker 1: be a startup founder. More than fifty of companies fail
Speaker 1: and probably for good reason. And so um, Yes, I
Speaker 1: hosted Business School seasons two and three and potentially there
Speaker 1: will be more seasons um and I'm very proud of
Speaker 1: the fact that, you know, at one point we we
Speaker 1: cracked the top twenty business podcasts, and people seem to
Speaker 1: be really entertained um through these conversations with you know,
Speaker 1: insightful founders who were vulnerable with me about you know,
Speaker 1: what it was like to build their business. And I'd
Speaker 1: like to think they were vulnerable because I have, you know,
Speaker 1: a good amount of compassion for the experience of being
Speaker 1: a founder, and also because I'm a New Yorker and
Speaker 1: I just like to talk. You're also a founder, so
Speaker 1: there's gonna be some you know, empathy that's genuine. You'r
Speaker 1: you went through what they're going through exactly exactly, and
Speaker 1: so um. You know, what you do, Barry is quite similar.
Speaker 1: You're you host an exceptionally successful business podcast and you're
Speaker 1: also an allocator. You know that it's it's interesting to
Speaker 1: do both because you have I think that being an
Speaker 1: investor is a lot like being a journalist. You know,
Speaker 1: in both professions, you won't succeed unless you are confidently
Speaker 1: curious and if you are having conversations to listen more
Speaker 1: than you speak. Well, I'll let you in on a
Speaker 1: little secret. Since it's so late in the podcast and
Speaker 1: fewer people will be hearing this, the people I invite
Speaker 1: on the show are essentially just conversations I want to have.
Speaker 1: If other people come along and listen, that's fantastic, But honestly,
Speaker 1: it's for an audience of one, namely me. The reason
Speaker 1: I wanted to have you on is because I'm intrigued
Speaker 1: by the world of venture and alternatives and impact. I
Speaker 1: think it's safe to say that a lot of people
Speaker 1: have been somewhat disappointed in the result of E s
Speaker 1: G investing and impact investing that for it's captured a
Speaker 1: lot more mind share than it has captured capital, although
Speaker 1: we're seeing signs that's starting to shift. But then the
Speaker 1: real question becomes, all right, so I'm investing less in
Speaker 1: oil companies and more in other companies that just happened
Speaker 1: to consume fossil fuels, what's the genuine impact of of
Speaker 1: my E s G investing? It feels like it's sort
Speaker 1: of diminimus, whereas what you do really feels like it
Speaker 1: has a major impact for people who are interested in
Speaker 1: having their capital make a positive difference. Thank you for
Speaker 1: saying that, and I will return the compliment by saying
Speaker 1: that I've really enjoyed getting to know you on our
Speaker 1: Wonky Economists zooms um and I think that you're right.
Speaker 1: I think that E s G investing, certainly in the
Speaker 1: public markets, has had diminished returns historically because the definition
Speaker 1: has been still bizarre and so all over the place.
Speaker 1: And I've read incredible books from people like company Book Levine,
Speaker 1: who helps coin the term Rockefeller Foundation originally can coin
Speaker 1: the term you know, you read about lower case higher
Speaker 1: are and iris plus measurement, and it's so hard to
Speaker 1: have just a standardization of what it means to be
Speaker 1: an impact investor, and so it can be the bother.
Speaker 1: But we don't bother. Rather, we kind of come up
Speaker 1: with our own subjective point of view of the world,
Speaker 1: and we say, what is impact mean to us? Certainly
Speaker 1: it means not investing in sin stocks, um, But then
Speaker 1: those sin stocks have to begin somewhere. It has to
Speaker 1: begin with an idea that somebody had once upon a time.
Speaker 1: And so rather we are investing in the way the
Speaker 1: world should look from our perspective. UM. And with that
Speaker 1: in mind, it doesn't have to be impact like your
Speaker 1: grandpa's dc UM. It can be impact for a modern
Speaker 1: generation but simply thinks and behaves differently their votes with
Speaker 1: their dollars. UM. You know, people often say, oh, well,
Speaker 1: my E S G portfolios under performing, But then if
Speaker 1: you dig into the specifics, are you investing in Tesla?
Speaker 1: It's a pretty good year. Did you back beyond Meat
Speaker 1: had a great year. And so when you kind of
Speaker 1: redesign the public market not by a sleeve in um,
Speaker 1: you know, a bank's version of a portfolio, but rather
Speaker 1: by companies that you think are making demonstrable change in
Speaker 1: the world, then you can walk away realizing, oh, had
Speaker 1: I only invested in these companies that are purpose driven,
Speaker 1: I would have had outside returns. And that's what we're
Speaker 1: trying to deliver on at TMV. That's that's the promise,
Speaker 1: really really very very intriguing. I know I only have
Speaker 1: you for a few minutes, so let's jump to my
Speaker 1: favorite questions that I asked all of our guests, starting
Speaker 1: with tell us what you're streaming these days? Give us
Speaker 1: your favorite Netflix, Amazon Prime or any podcasts that are
Speaker 1: keeping you entertained during the pandemic. While my family has
Speaker 1: been binging on on ft Wave on HBO Max, which
Speaker 1: is the story of Big Waves surfer Barrett McNamara, who
Speaker 1: is constantly surfing the world's largest waves. And I'm fascinated
Speaker 1: by people who have a mission that's sort of bigger
Speaker 1: than success or fame. Um. But they're driven by something
Speaker 1: and part of that something is curiosity, and part of
Speaker 1: it is insanity. And so not only is it visually
Speaker 1: stunning to kind of watch these big Waves surfers in Portugal,
Speaker 1: but it's also a mind trip, you know, what motivates
Speaker 1: them to get out of bed every day and potentially
Speaker 1: risk their lives doing something so dangerous and and so
Speaker 1: nannas but also at the same time so brave and heroic.
Speaker 1: So highly recommend um. I am um listening to too
Speaker 1: many podcasts. I listened to I don't know, a stream
Speaker 1: of things from I'm a Big You know carriswsher fan
Speaker 1: as reclient fan, so they're both part of the New
Speaker 1: York Times these days, Um, and of course your podcast,
Speaker 1: Mary Well, well, thank you so much. Let's talk a
Speaker 1: little bit about who your early mentors were and who
Speaker 1: helped shape your career. It's gonna sound ungrateful, but I
Speaker 1: don't think in like a post lene and definition of
Speaker 1: the word, I've ever truly had a mentor or a sponsor. Now,
Speaker 1: having said that, I've had people who have really looked
Speaker 1: out for me and been incredibly gracious with their time
Speaker 1: and capital, and so I would absolutely like to acknowledge
Speaker 1: that first and foremost. You know, I think about how
Speaker 1: generous Adam Grant has been with his time and his
Speaker 1: investments for TMV and Fund one and Front two, and
Speaker 1: he's the best selling author and worked in his highest
Speaker 1: rated business professor. Um So, shout out to Adam if
Speaker 1: he's listening, or back Comstock, the former vice chair of
Speaker 1: che who has been instrumental in my career for about
Speaker 1: a decade and a half now. Um and she's also,
Speaker 1: um you know, really leaning into the t m V
Speaker 1: portfolio and has become a patient of Parsley Health and
Speaker 1: early investment of ours and and also an official advisor
Speaker 1: to the business. Um So, people like Adam and besth
Speaker 1: certainly come to mind. But I don't know. I just
Speaker 1: I'm not sure mentors really exist outside of corporate America anymore.
Speaker 1: And part of the reason why we started Transact Global
Speaker 1: is to kind of foster the concept of the peer
Speaker 1: mentor people who are going through the same thing as
Speaker 1: you at the same time, and allowing that high mentality
Speaker 1: with an abundance mentality to catalyze people to kind of
Speaker 1: go further and faster. Let's talk about some of your
Speaker 1: favorite books and what you might be reading right now. Okay,
Speaker 1: so in the biz book UM World, the as I
Speaker 1: know your your listeners are creating UM. I'm a big
Speaker 1: fan of negotiation Genius. I took a crash course with
Speaker 1: one of the authors, Max Bagamin, at the Kennedy School,
Speaker 1: and it was illuminating. I mean, he's one of the
Speaker 1: most captivating professors I've ever had the pleasure of hearing lecture.
Speaker 1: And this book has really helped me understand the concept
Speaker 1: of the ZOPA, the zone of possible agreement and how
Speaker 1: to really negotiate though UM. And then for Adam, whom
Speaker 1: I just referenced UM, of all of his incredible books,
Speaker 1: my favorite is given Take because I try to operate
Speaker 1: UM with that approach in business. You know, give more
Speaker 1: than you take and maybe in the short term you'll
Speaker 1: feel depleted, but in the long term, you know, karma
Speaker 1: pays off. But mostly very I read fiction. UM. I
Speaker 1: think the most interesting people in the world, or at
Speaker 1: least the most entertaining at dinner parties, are all avid
Speaker 1: readers of fiction and history. So I recently reread, for instance,
Speaker 1: all of my favorite short stories from college, from those
Speaker 1: Dioskis in Gentile Creature to Drown by one Odeas um
Speaker 1: Passing by Millah Larson, the Diamond, as Big as the
Speaker 1: Risk that This Gerald. Those are some of my very
Speaker 1: favorite stories of all time. And my retirement dream is
Speaker 1: to write a book of short stories. M really really
Speaker 1: quite intriguing. Are they all available in a single collection?
Speaker 1: Or these just going back to your favorites and and
Speaker 1: just plowing through them for fun? Those are just going
Speaker 1: back to my favorites. UM. I try to reread Passing
Speaker 1: every few years. It just somehow seems to be more
Speaker 1: and more relevant if I get older. Uh and uh.
Speaker 1: One ideas has become so incredibly famous. Um. The first
Speaker 1: read Drown about twenty years ago. But it's his original
Speaker 1: question of short stories that you know, brought in my
Speaker 1: perspective of why it's important to think about a broader
Speaker 1: definition of America, I guess. And yeah, now that's just
Speaker 1: that that was just sort of off the top of
Speaker 1: my head. Is a toil ring us few stories that
Speaker 1: I really love. That's a that's a good collection. Um,
Speaker 1: And we're down to our final two questions. What sort
Speaker 1: of advice would you give to a recent college grad
Speaker 1: who was interested in a career in either venture capital
Speaker 1: or entrepreneurship. Venture capital or entrepreneurship. Uh well, I would say,
Speaker 1: learned as early as possible how to trust your gut.
Speaker 1: So this could mean a myriad of things as an entrepreneur,
Speaker 1: could mean under the halo effect of an institution university
Speaker 1: or high school, or maybe having a comfortable day job,
Speaker 1: tinker with ideas, get feedback on that idea, don't be
Speaker 1: afraid of looking or sounding dumb, um, and build that
Speaker 1: peer network that I described people who are rooting you
Speaker 1: on um and are also insatiably curious about wonky things.
Speaker 1: And I would say that for venture capital, similar play
Speaker 1: on the same theme. But you know, whether it's putting
Speaker 1: small amounts of money into new concept block chain investing,
Speaker 1: or whether it's meeting with entrepreneurs and saying maybe I
Speaker 1: only have three thousand dollars saved up that I believe
Speaker 1: in you enough to bet a month's rent in Brooklyn
Speaker 1: on your concept if you'll have me as an investor.
Speaker 1: So play with your own money, because what it's really
Speaker 1: chief teaching you in return is how to follow instincts
Speaker 1: and to base Petter recognition off of your own judgment.
Speaker 1: And if you do that early on, over time these
Speaker 1: all become data points that you can point to, and
Speaker 1: there are lessons that you can glean while not taking
Speaker 1: the risk of portfolio management. So I guess the real
Speaker 1: advice to your listeners is you know, more action, please,
Speaker 1: really very very intriguing. And our final question, what do
Speaker 1: you know about the world of venture investing today that
Speaker 1: you wish you knew fifteen or twenty years ago When
Speaker 1: you were first getting started. Twenty years ago, I was
Speaker 1: a bit of a Pollyanna and I thought every wonderful
Speaker 1: idea that simply is built by smart people and has
Speaker 1: times the market correctly will work out. And I will
Speaker 1: say that I'm slightly more jaded today because of the
Speaker 1: capital structure that is systematically allowing the biggest firms in
Speaker 1: the world to kind of eat up the generous portion
Speaker 1: of what's called the lp PI, which leaves less capital
Speaker 1: available through the young, upstart VC firms. And of course
Speaker 1: I'm biased because I run one that are taking outside
Speaker 1: risk on those non obvious ideas that we referenced. And
Speaker 1: so what I wish for the future is that institutional
Speaker 1: capital kind of reprioritizes what it's looking for. And in
Speaker 1: addition to having a bottom line of reliable and you know,
Speaker 1: demonstrable return on any given investment, there are new standards
Speaker 1: put into place saying we want to make sure that
Speaker 1: a portion of our portfolio goes to diverse managers because
Speaker 1: in turn, we recognize that they are three times more
Speaker 1: likely to invest in diverse founders. Or we believe an
Speaker 1: impact investing can be broader than the s G e
Speaker 1: s G definition of a decade ago. So we're coming
Speaker 1: up with our own way to measure what sustainability or
Speaker 1: what impact means to us. And if they go through
Speaker 1: those exercises, which I know is hard because certainly I'm
Speaker 1: not trying to add work to anyone's plate, I do
Speaker 1: think that the results will more than make up for it.
Speaker 1: Quite intriguing. Thank you so Ria for being so generous
Speaker 1: with your time we have been speaking with Soriah door Abi,
Speaker 1: who is the co founder and general partner at t
Speaker 1: MV Investment. If you enjoy this conversation, we'll be sure
Speaker 1: and check out any of the prior three and seventy
Speaker 1: six conversations we've had before. You can find those at
Speaker 1: iTunes or Spotify or wherever you buy your favorite podcasts.
Speaker 1: We love your comments, feedback and suggestions right to us
Speaker 1: at m IB podcast at Bloomberg dot net. You can
Speaker 1: sign up for my daily reads at Hults dot com.
Speaker 1: Check out my weekly column at Bloomberg dot com slash Opinion.
Speaker 1: Follow me on Twitter at rid Halts. I would be
Speaker 1: remiss if I did not thank the crack team that
Speaker 1: helps me put these conversations together each week. Tim Harrow
Speaker 1: is my audio engineer, Paris Wold is my producer. Atika
Speaker 1: val Bron is our project manager. Michael Batnick is my
Speaker 1: head of research. I'm Barry Rihults. You've been listening to
Speaker 1: Masters in Business on Bloomberg Radio.