From Inception to Iconic: All Raise x Mayfield

It is never a straight line from inception to achieving breakout status for companies.

Entrepreneurs navigate many stages of getting the world to share their vision – inspiring employees with their mission, getting investors to write the check, propelling customers to buy the product and most importantly, growing as a CEO.

In this session, entrepreneur whisperer and investor Rajeev Batra (Marketo, Servicemax, Outreach) chats with three founders that Mayfield has invested in – Sandi Lin, CEO of Seattle-based customer training leader Skilljar, Christina Ross, CEO of New York-based modern FP&A software provider Cube and Janice Chen, Co-founder & CTO of Bay Area-based CRISPR platform Mammoth Biosciences – to share their learnings and highlights from their journey.

Transcript

Rajeev:
Thanks everyone for coming and attending. I don’t do these that often, and it’s a pleasure when I get to, especially with guests like Christina Ross, Sandi Lin, and Janice Chen, three female founders… Actually, I should stop using the word female founders because I believe they’re just founders, and I have a certain philosophy about these things. And, Sandi and I often talk about this when I tell her that I truly approach the world being blind to color, gender, race, et-cetera. And, life circumstances, because I’ve, myself, wanted to be treated that way, but I also recognize that that’s not how the world works always. And so, it is all of our responsibilities to promote and work hard at creating equality at every single level and do what we can do.

So, I take that responsibility very seriously, and I hope it’s a lifetime of work that I can continue to dedicate myself to. And so, I’ve had the pleasure to work with Sandi and Christina, and other CEOs in the portfolio who are not men, not of traditional backgrounds. As a matter of fact, I’ve also worked for two venture capitalists who are not men. I’ve worked for a number of venture capitalists who are males, but I’ve also had the pleasure of working for Virginia, who was a great mentor and Heidi Roizen as well. She’s one of the key people who was responsible for having me come out to Silicon Valley and had me put on this path of pursuing venture capital. So, I’d like to thank everyone for being here and giving me this platform to have a fun conversation with Sandi, Christina, and Janice.

I’ll just kick off with quick introductions. I’m one of the partners at Mayfield, I help lead the enterprise software practice and I focus and specialize on application software, SaaS. And that’s what I’ve been doing, supporting entrepreneurs in that area for 14 years here at Mayfield, and I did venture capital at a couple other places before this. I have been in the enterprise software industry for a while, both as an entrepreneur and as an executive. So, with that, I’d like to introduce the panel. We have Christina Ross, the Co-founder and CEO of Cube Software, and Christina, maybe you can just give a… Maybe, I’ll just do a quick round table, and then you guys can talk more about yourselves and introduce yourself. So, we have Christina Ross, the Co-founder and CEO of Cube Software based out of New York. Sandi Lin, the Co-founder and CEO of Skilljar based out of Seattle. And, we have Janice Chen, the Co-founder and CTO of Mammoth Biosciences. And Janice, you are in San Francisco, or Berkeley, or where are you based these days?

Janice:
San Francisco, these days – the company is in Brisbane, which is just north of south San Francisco.

Rajeev:
Great, so why don’t you go ahead and introduce yourself and a bit about why you’re here and what do you hope to share with the audience today?

Janice:
Sure, thank you so much, Rajeev, for the introduction, and thank you to All Raise for giving me the opportunity to be on this panel with these amazing founders. It’s truly a privilege to be able to talk about our journeys. And so, my name is Janice Chen, I’m the co-founder and CTO of Mammoth. I actually consider myself a scientist founder, so coming in from the life sciences biotech industry. A little bit about my background – I did my PhD in Jennifer Doudna’s lab at UC Berkeley. And, you may know her from her recent Nobel prize on the discovery of CRISPR as a gene editing tool. So, I know part of our goal here is to tell you a little bit about our stories and how we got to where we were to hopefully inspire others who are considering this path.

But for me, I never really considered starting a company. Part of considering my career options was really just talking to people, attending panels like these, and learning about what PhDs did and the next step in that career, both in academia and industry. And, I think a lot of what motivated me was having someone like Jennifer be a really strong mentor and really pushing me to think big. For me, the breakthrough moment was sort of near the end of my PhD when we discovered that CRISPR could not just edit DNA, but also detect DNA. And then, being able to show that the technology could detect cancer-causing HPV in patient samples was really what unlocked me and my co-founders to realize, okay, we have something really powerful here to be able to transform it into a company.

So, sort of after that moment, it was sort of an obsession for all of us to think about how can we actually build these CRISPR technologies to address unmet needs in healthcare and really building the technologies beyond just the academic lab. Coming out of grad school, there really wasn’t much to lose, and we just decided to take the leap of faith. So myself and my co-founders Lucas, Jennifer, and Trevor decided to come together and start the company. At Mammoth, we are developing this Nobel prize-winning CRISPR technology as a programmable search engine for the genome. And today, we are discovering and developing these novel CRISPR proteins to diagnose and cure diseases. And in the future, a platform will enable industries beyond healthcare, such as agriculture, bio-security research, and more. So with that, I’ll hand it over to Rajeev to introduce the next speaker.

Rajeev:
Janice, thank you so much. That’s a really inspiring, and I’m sure we’ll learn more about how you guys are as a team, sort of taking the journey, have taken the journey forward to truly building a groundbreaking platform company. Sandi, why don’t we go next with you?

Sandi:
Sure. I’m Sandi Lin, the CEO and Co-founder of Skilljar. We build customer education software for companies to deliver product training, and specifically we’re best at end users, customers and partners or people outside the four walls of your HR and employee system. I am an engineer by training, civil engineering actually, with a focus on transportation, and supply chain, and large-scale systems. Worked for that for a few years after undergrad then went to business school. I did not identify as somebody that would ever go to business school, so I’m happy to share that experience as well. And then, after finishing my MBA, I joined Amazon as a Product Manager in 2009. So, I have some pretty large company experience as well. I kind of always wanted to be an entrepreneur, my dad was an entrepreneur, I always had that little voice inside of me that said, can you do it? Can you do it?

But honestly, I was terrified about the career risk, the financial risk, the throwing myself off the cliff to all these things I wouldn’t know, and be responsible for. And, it actually has been terrifying, so I’m happy to talk about that as well. Skilljar now, we’re about 170 people, we’ve raised over $50 million in venture capital, 400+ customers. So, it’s been quite a journey and we pivoted a few times early on, but our mission is to create the win-win-win: where anyone can get the skills they need to succeed in a changing economy; where customers can get the full value of the products and services they’re trying to use; and where companies can also drive business outcomes through learning.

Rajeev:
That’s great, Sandi, thank you for that. And, you are changing the world in many, many ways, by enabling people to really be equipped in this new digital economy. I call it the new digital economy, but because today’s software is only, still 2% tech, still only sort of 2%, 3% of the GDP. And, equipping the next generation workforce, with the ability to use the products and services to do their job better is a pretty incredible thing to do. And while doing that, you’re also enabling incredible business success. And, it is pretty remarkable, all the wonderful things you’ve been able to do in the last few years. And, I think you’ve only gotten started. So Christina, you’re up next, you have a wonderful story as well. And both of you, Christina and Sandi share something in common that you both were Techstars entrepreneurs. And, I know there was some questions around advice on sort of getting into accelerators, incubators, et-cetera. And so, maybe you guys can share that too as well when you talk about this. So Christina, with that, please.

Christina:
So, my name’s Christina Ross, I’m Co-founder and CEO of a company called Cube. We’re a real time FP&A platform for modern finance teams and businesses to make faster, smarter decisions. And, I’ll start by saying that I know not everyone thinks of finance as the type of company, or finance centric company, as being mission-driven, but we very much are. Our mission is to elevate the role of finance in an organization. When you think around the corporate table, who often has the seat that’s thought of as the back office, and that’s typically the finance persona. It’s ready for a rebranding, it is still thought in many ways, if you know the movie Office Space, stapler in the basement. But, the reality is the future of finance is incredibly strategic. And, it’s the difference between companies that do not do well or fail, and the companies that really excel.

We’re also moving finance from being a cost function to being a growth function. I’m a former CFO, I very much have been a startup groupie in many ways, for most of my career. After being at big companies like GE and a consultant with Deloitte, I found this little company, no one had heard of called Rent the Runway. There were maybe 30 people at the time, and I joined as their first head of finance. And, I repeated that journey a couple of times through different startups. And, one thing I learned in that journey was how important the finance role is to survival in companies, in stages like these and how misunderstood they were. And, one of the reasons why they were misunderstood is they weren’t empowered to do the work that they were there to do because they spend all their time manually aggregating data on all these different spreadsheets.

So, I’m sure some of you are dealing with that now or have seen it. And, what we built at Cube is a financial planning and analysis platform to not only take away all the manual pain, but empower these finance users to make faster smarter decisions and be heroes within their own organizations. So, I’m super excited to join the panel today because I felt like when I was first fundraising, there was this unwritten playbook that I didn’t have access to. And, if someone had opened up that playbook for me, it would have saved a lot of challenges. There’s so much growth and so much journey ahead still, but hopefully we can share some of those pages with you all today.

Rajeev:
That’s great, Christina, and I think it’s important to underscore again that it’s hard to get inspired by boring software – what’s software? What can it possibly do? But if companies can make better decisions about where to allocate their resources, both financial, human, and other resources, they can drive better outcomes, right? Innovate, create better products and services that actually make an impact and change the world. So that’s the connection between that and really bringing things to life. And of course, Janice, your company is at the forefront of transforming so many things. And, it speaks very closely to me and some of the causes I’m involved with given I have a special needs child.

A lot of the research that is being done around finding a cure for his condition and the condition of many children like him has benefited from CRISPR technology to create, for example, mice models and other things. And, it may even have efficacy and the eventual therapies that they might come across. So, I think there’s a few questions that came from people, and then there are some questions I think we have discussed together as a group and in our conversations. In terms of some of the opportunities and challenges you face as entrepreneurs in raising capital, hiring people, building companies, creating winning cultures. Maybe, we start with a topic around fundraising. I think that’s, that’s probably a pretty key and important one, all of you have sort of touched upon it.

I have two questions I really want to dig into – one is fundraising, there’s a few questions here. I’ll just rattle them off, and then let’s sort of make more of a dialogue around this. How do we fundraise when we don’t have product market fit? If the MVP is primitive, is their a chance to get funding? Do VCs invest at the early stages, pre-seed seed, et-cetera? And so, if you are in beta and pre traction, what are the most important data points to share when applying for grants and accelerators? Is it market size, potential revenue? Are there tools and services you recommend that can help guide a new founder estimate that stuff?

So, the point is, it feels like there’s questions around what stage do I need to be in order to engage in a fundraising process and what are some places to start? Do I go to VCs? Do I go to Angels? Do I go to friends and family? Do I go to incubators? Why don’t we start with you, Sandi.

Sandi:
All right, cut me off if I’m going too long because I have opinions. So, I think first of all, for kind of less demographically advantaged founders, this is actually a more important issue because often we don’t have the same access to generational wealth or high net worth individuals. My parents were immigrants that came to this country with nothing. So the, oh, you can self-fund yourself financially or hire a team that can self-fund themselves financially often becomes a more acute issue, I think for less represented founders more than others. And then, also I can say for me personally, I very much upfront decided I was not willing to go into credit card debt and/or sleep on people’s couches, or all the sort of war stories you hear about fundraising.

And that was a decision that I made for myself early on. So, I think one of the secret playbooks or pages that Christina mentioned is that all of the dialogue for early stage fundraising, prototypes and traction, a lot of that is just a way for the investor and the entrepreneur to get to know each other, because there are angels through VCs that will fund on a PowerPoint and there are angels and VCs that will not fund through a PowerPoint. And, the same fund, or person, or partner will say one thing and do another in any given situation, so it’s all situational. And so, a lot of the dialogue around these very fundamental business questions is more around kind of getting to know you, get to know you as a person, get to understand how you think about the space.

So for me, and I started this company in 2013, so the environment was very, very different, and I was also terrified by the fundraising process and asking for money. So, the idea of applying to an accelerator made a lot more sense for me because I kind of understood that process, right? I’ve applied to schools, I’ve applied to jobs, I kind of knew how to get through that. And then, it doesn’t hurt to apply, and if you get in that gets you along another milestone to the journey. So, I think the accelerators were much more prominent in the early stage fundraising ecosystem back in 2013 than they are now. But I’m very glad that I did so in hindsight, because I think it helped get… There’s a big difference between having zero money and having $100,000, or what it was at the time, because it’s a huge difference in terms of just being able to pay your annual bills, out of something that’s not your own pocket.

Rajeev:
And that, was Techstars Seattle, correct?

Sandi:
Correct.

Rajeev:
Great, okay. And Janice, how about you, how did the fundraising process start for you, or how did you even think about it?

Janice:
Yeah, so first of all, for us, fundraising has been a team effort. I’m not the CEO, so I didn’t lead the fundraising effort. Our CEO, Trevor Martin, is the one that led that effort, but it really was a team effort between the founders, and sort of the core employees at Mammoth. And certainly in the early stage, like Sandi said, I mean, everything’s so vulnerable, right? It’s kind of a chicken or the egg problem, I think is what a lot of the questions I think we’re getting at. You don’t have the capital, so how do you get to showing your prototype works, but you also need to show your prototype works to get the capital, right? So, there is kind of this dilemma, certainly in the early stages. I think, I can speak really only to my experience in the biotech industry.

And, this is my first startup and really my first real time job. So, I come from a unique, I guess, background where I came to this with completely fresh eyes, which has been great, but also has also been really challenging. For our industry, biotech is extremely capital intensive, it’s really hard to bootstrap. You need lab space. A lot of what’s great about coming from academia is that you do… At least in my case, we were able to do a lot of that proof of concept work as part of our research as PhD students. So, a lot of the early prototypes, if you will, were done as an academic graduate student, and we’re able to out license that technology or in license that technology to Mammoth from UC Berkeley. We had, again, a lot of great networks being in the Bay Area, being in Jennifer’s lab, connecting with Trevor, ultimately connecting with Mayfield and getting a lot of momentum around, okay, getting alignment on what is the mission of the company? How can we continue to build this platform and kind of leveraging, again, the resources as well.

Particularly, with incubators, I think for biotech companies, that’s really critical to get the lab space and show initial proof points early on. And ultimately kind of lay out a plan that you can execute on. I think, the other piece for fundraising is, for us, it was really important to make sure that we were in a position of strength when we were to go out fundraising, just to make sure that we could really leverage kind of the value creation that we had been developing at the company. But certainly, in the early days it’s hard and there’s a lot of uncertainty, but it is just being super thoughtful about who you’re talking to and making sure that the investors that you’re interested in are really aligned with you, the founder, and the company, and the mission.

Rajeev:
That’s great, and Christina?

Christina:
All right, I have a few thoughts, so let me just cover some of them. First, is I’ll start with a warning, which is, you’ll get a lot of, “why don’t you just” advice, which is what I got during the finance journey of, oh my buddy, so-and-so started a company, and he raised like $15 million before he had anything. It’s okay if that doesn’t happen to you, because you’ll hear the stories of the one-offs, you’ll hear the stories of the 1% of deals that make it worth talking about. So, fundraising is hard despite the fact that you’ll hear lots of stories about how easy it was for some people, it’s hard. Two, my fundraising strategy was to play Moneyball because the beginning is the absolute hardest, in my opinion. And then, it gets a little easier, and a little easier, and a little easier.

And if you know Moneyball, the idea is to get on base. And so each step of the way is you’re making progress in your journey, in your startup, it’s to get on base, it’s to get the next win. And, getting my first dollar of funding was moving a boulder up a mountain. So, I really resonated with Sandi’s point of, zero money and $100,000 is such a big difference. And at later, stages of fundraising, $100,000 is nothing. At early stages of fundraising, $20,000 would have made all the difference in the world. So, just make that incremental progress to get on base because that’ll allow you to go further and further. I think, the other really important thing is your fundraising, that it took me a while to figure out, is it’s all about fit.

So now, that I’m a lot more involved in things like sales and marketing, everything I relate to a funnel or a funnel exercise of what comes in at the top of the funnel and at the bottom. And, when you’re fundraising, you’re thinking about your investor funnel, they’re looking you just as much as you’re looking for them. So, one thing that changed my mindset on things was actually being in a dinner where it was mostly investors and a couple of founders, and the way they were talking about founders, how do we get in these good deals? And I was like, wait a minute, they’re all fighting over us, I thought we were fighting over them. So, get your mindset in, they’re looking for you, you’re not just looking for them.

And then, when you think of that funnel, it’s all about the right fit. If someone rubs you the wrong way, you don’t have to work with them. If, someone doesn’t understand your space, then that’s their loss. I spent so much time trying to get people to understand what our company was and how it worked, they weren’t going to be the believers because they didn’t understand it. And so, what I should’ve done is moved along earlier rather than trying to get them to see my side. So remember, it’s ultimately a fit exercise, I’m sure there’s lots of other nuggets, but those are a few things for me.

Sandi:
I was going to add also, there is a deal out there for you, especially now with AngelList and all kinds of virtual ways. You no longer have to just pitch local people in their area. So, I completely agree with Christina, I think for my first round, I pitched over a hundred potential funders, and I had actually set myself a quota where even before I was fundraising, I said, every week I’m going to meet with one new person that could be an investor in my company. And, I held myself to it, because it was very uncomfortable for me. So, there is a deal out there for you, and it’s like work.

Rajeev:
That’s some great advice. I think, a couple key things I heard here, there’s some questions around what stage should I be fundraising? At what point should I go out and start fundraising? And, I think fundraising in a way, it is a state of mind because you need capital, some sort of capital to develop your product or service and get it out there. And so, there’s an old adage that says, entrepreneurs or founders should always be fundraising. And, I don’t mean that in the sense of, you have your business to run and your product to build, but there’s this concept of you do need capital, so you always have to kind of be attuned for the fact that you are open to capital or capital conversations, especially in the early days. Because let’s face it, it’s hard, right?

So, you kind of have to have almost this subconscious background process running in your mind that this is something you have to do. Because it is not one of these things that you’re going to do all this stuff, and then you’re going to go fundraise sort of in a serial fashion, right? Yes, at some point that’s what it becomes. But, I think it is a bit of a state of mind, because in the early days, it’s the people who believe in you, they really have to believe in you and they have to believe in what you are trying to do. And, they have to be comfortable with the fact that whatever it is that you’re going to do will also change, and evolve, and morph. And so, it’s a little bit of both of those things.

And, it is a bit of a, sort of this somewhat amorphous exercise, but it’s a state of being, state of mind. And like Christina said, hey, you’re at a dinner, there’s like eight, nine people and their investors. If, you have that sort of background process running in your mind, you’re like, wait a second, these are potential investors. Now, one of them might be interested in what I’m doing or none of them might be, but they like what I’m doing, or who I am, and what I represent. They might say, listen, it’s not for me, but I know somebody else who’s really looking for something like this. So, I think that’s an important part, and the other thing I would say that I’ve observed is, there are a lot of people out there who want to support entrepreneurs. Especially, in today’s day and age, I think, A, they want to do that, B people have a lot of money.

If people haven’t noticed, the Fed’s been printing money at a prodigious pace. And so, there is that opportunity, one just has to also believe it’s possible, right? I think, yes, it’s hard, and the statistics are not very encouraging always, but I think first of all, one has to believe that it’s possible. And, that’s an important component. One question I have for all of you: at what point, and this is connected to fundraising in a way. Was there a specific point in time at which you said, I’m going to go start this, I’m going to be an entrepreneur – there’s a shift that happens in your mind.

And, was there a shift that caused you to say, this has to happen, I’m going to succeed at this and you crossed a threshold? Because, I think that’s an important part to making a commitment to becoming an entrepreneur, and then sort of raising capital then becomes part of it, right? It’s this moment that you cross this threshold. I’d love to hear that from the group here. And, did that conviction help in sort of saying, I have to find capital now, and now I’m going to go execute on some strategy?

Christina:
I can answer that. I knew I always wanted to be an entrepreneur because I became this entrepreneur groupie where I was doing startups, but I wasn’t the one in charge, so something was always inside. The way I made it happen though, that was the hardest part. So, the mind shift for me was how do I now move my life around this thing that I really want to do? How do I take what’s in here and make it part of my environment? My story was I had a full-time job as a CFO, I was making good money. I had two and a half year old twins at home, I was in my mid thirties, this isn’t really the time you start a company and take no income in. But for me, if I didn’t do that at that moment in my life, there’s no way I would have done it 10 years later.

That’s the story that I told myself to make the change. And, I had a conversation with my husband, there’s actually a very specific story where we were going to buy a house. And, we said, well, if we buy this house, we have to get a car, maybe two. And, we have to maybe have someone to watch the kids during the day. Anyway, I’ll make a long story short, we realized we would be tied down financially and I would never be able to do this. And so, we made a decision that in order to be the entrepreneur that I felt up here, I was going to have to change my life. And so, like Sandi said, I didn’t want to sleep on someone else’s couch. But for us, that meant some other sacrifices. And, I gave myself a time limit of a year, of, if I’m not making the right amount of progress in a year, I’ll revisit this.

And then, it was off to the races. So, I spent a good six months of time before I quit my job, really understanding what it meant to be an entrepreneur, reading every single book. Not about how awesome certain people are, but literally how hard it is. Because, if you prepare yourself for how hard it is, I don’t want to say it’s not hard, but it doesn’t surprise you. So again, I’ll use the example again, that I had twins and everyone told me it’s the hardest thing that ever happens to you having two babies the same age. And, when I did it, it wasn’t that bad because I was prepared for it to be the worst thing that ever happened in my entire life. And of course it was wonderful, but same thing with being an entrepreneur, everyone’s like, it is the hardest job in the entire universe. But, once you get yourself there mentally and get your environment there, then there’s no stopping you.

Rajeev:
And Christina , and how your first check come about? There’s a lot of conversation here, I’m seeing a lot of comments on, what was your first check that gave you that confidence and that allowed you to… And, did things accelerate after that? And, how many people did you raise capital from in your sort of early, early phase? And, was that before Techstars, after Techstars? And, you were in Techstars New York, right? And so, when did that first capital show up, and where did Techstars fit in? And, maybe we talk about a little bit about how you seed happened, and how you series A happened, so people get a little bit of a full picture here?

Christina:
Yeah, I had a lot of, “why don’t you just” advice in the beginning. And everyone’s like the market’s so frothy, everyone’s so wealthy, just have 10 people write you a $50,000 check, you’re all done. I’m like, okay, who are these people who are going to be writing a $50,000 check? I didn’t have the network of wealthy people, I knew a couple. I have like a rich cousin and I got a check from him, but this was a friends and family round. And, you can only pull together so much in a friends and family. But, I wasn’t getting the $250,000, $500,000 that I would need to hire people who were really going to commit to building this product with me. So, I actually started cold calling or cold emailing, I looked out on LinkedIn for people who were associated with my somewhat niche-y industry, and pitch them, literally just live pitch them.

And, I got some initial interest, but I also didn’t know how to close at the time, how to close an investor. And so, I had a lot of people sort of waiting for the round to come together before they commit their checks. And, it really took one final yes, so by the time I got the yes from Techstars, if you’re in the program, every other check… Once people heard this one signal from the market, my round literally closed immediately. So, I went from maybe having 150K to 600K in two days, covered. And then, once I had that, I was oversubscribed for my round, before I knew it, I was picking which investors I wanted or not in my pre-seed. And, we ended up having to cut it off at 1.25M.

So, it was a waiting game for the signaling. I see in the comments here, “What does good at closing look like?” So, I saw this in some of the other questions before, I was new to asking for money, and the first problem with what I just said is, I’m asking for money. I’m not asking anyone for money, I have a really amazing business that, if you’re lucky, you have the opportunity to invest in. That’s a mind shift change. So number one, I had to get out of the, I’m asking you for money for my business, and instead it’s, I have a really cool opportunity, I might have some space, maybe I can let you in. And, one piece of coaching that Techstars gave us was the language you’re using. It’s maybe I can squeeze you into the round, how much do you have? We have a certain amount to allocate.

So again, you’re thinking of it like a constraint and resources is part of it. And then, when it comes to closing, people might have some objections. So, it’s like closing a sale, too. You might ask them, they were like, oh, this is interesting, I could be interested in investing. And then, I used to leave it there and be like cool, I’ll call you later. Instead, now I asked them, well, what would it take for you to get to say 25, 50K? And, they might say, well, I really want to see another small fund in the round. Okay so, assuming there’s another small fund in the round you’re in. So get their specific objections. And then, when you get that fund and you call them, then you come back, so that’s the soft close. And then, when you want them to write the check, say, I needed in 24 hours, give them a time limit, and the round is closing.

So, you get them from whatever objective they have to saying, assuming that objective is met, we have a deal basically, and then get them to the other side. Because, everyone wants to sort of commit, but never go all the way. And then finally, the seed and series A are longer stories. And we want to give them more time to Sandi, and Janice to cover.

Rajeev:
Christina, that’s wonderful, and I can testify to Christina’s approach because she worked this magic off of the fundraising, painting an amazing vision for the company that she was building, her background, why she is committed to it, and the product that we’re building. So much so that Mayfield preempted the series A. We preempted the Series A by probably, I don’t know, 12 to 18 months, is that fair?

Christina:
Yeah.

Rajeev:
And so, she did do this Jedi mind trick on us as well, and we’re glad that it worked out. Sorry for the Star Wars reference, but Christina’s starting to do sports references and Christina’s not a sportsperson, so I’m really excited to see that. And I think, one thing that Christina, you’re describing here and Sandi you’ve described this as well, is that fundraising is a sales process. It is a sales skill, and I believe that every person in the world is in a way a salesperson. You have to embrace selling a little bit, and especially as an entrepreneur, you’re always selling, right? You have to attract capital, you have to attract customers, you have to attract employees. And oftentimes, I find entrepreneurs, especially product entrepreneurs – and I apologize if I sound a little judgy here – but there’s a little bit of aversion to, I’m not a salesperson, I’m a purist, I’m creating a product and this is going to change the world.

But, deep down we’re all salespeople, and selling done right is a good thing, because selling is about solving somebody else’s problem. And, it’s a very empathetic act because it implies that you listen, you pay attention and that person is trying to solve a problem and you have a solution for them. And, in the case of Christina, the way Christina has described this is they want to invest in you. They want to invest in an innovative company, they want to invest in entrepreneurship and entrepreneurs. And yes, they want to make a return, but this is really risky stuff. So, they are seeking a company and a founder to invest in. And so, if you tap into that, sort of think about it from that standpoint.

I think it is about understanding their needs and seeing whether what you have to offer them fits that. And so, thinking about it as sales and developing your inner salesperson, I think is something that I would encourage people to really think about and embrace. And, if it’s a place where you need help, get some skills around that, or even role-playing and working with your friends, et-cetera, it’s okay to do that.

Sandi:
Especially if we’re talking about angels, a lot of time, their goal isn’t necessarily to make money from an investment, it’s around what they can say to their friends about what they did lately, who else is in the company – I co-invested with so-and-so. And so, this is where they kind of hoard to the close, especially early stage investors are a little bit driven by fear of missing out and what else is going on. And so, to me, a lead, our quote unquote lead was not the biggest check at all, but it was somebody I knew had a lot of cache with the other, in my case, Seattle investors. And so, nobody has to know how much somebody else is putting in. Yes, it’s going to come out on the closing docs eventually, but your lead can be somebody put in $5,000, $10,000 in, but you say so-and-so is leading the round.

If, they have the right brand reputation, that will get other people to move too, especially when they want to co-invest with so-and-so, right? And then, I’m not familiar enough with the actual transaction vehicles anymore, but I think there’s SAFE and other types of convertible things where… I mean, part of Techstars coaching is also set your first goal really well, so you’re always 50% full. So, if keep your first, we’re raising 200,000, from friends and family. Even I was able to cobble down, I think a 100K of commitments from my own savings, and like Christina, I had also given myself a year. I had saved to make this possible, I had every moderately non-poor person I knew was asked to participate. Of which, you’ll be able to hustle up, with enough effort, some degree of funding, and then you’re 50% closed. And then, all of a sudden, the next day you’re oversubscribed. So, you’re expanding the round and that’s a bit of the psychology.

Rajeev:
Yeah, that’s great. And look, there’s a balance, look fundraising is difficult, especially in the early days. But, with difficult things also comes appreciation for the resources that you acquire. And then, how you think about spending them. I do wish that fundraising were a bit easier for entrepreneurs, especially for, entrepreneurs of diverse backgrounds and women. It needs to be easier, but there is something to be said about fundraising. The barriers to fundraising actually do create an appreciation for the capital you have and how you’re going to go spend it. And, because overcapitalization does create a lot of problems as well. And so, I do believe that when founders do have a tougher time raising capital, they build different types of companies. I’m not suggesting that fundraising should be made difficult, but I always think about silver linings – anything that’s hard usually produces, right? Like diamonds are created by putting a lot of pressure on things.

Let’s shift a little bit from early stage fundraising to a little bit about sort of the company building side of things. You have capital now, I guess one last thing on capital would be, is in the beginning, all capital is the same, it’s green, dollars are green and you just need the money. How do you think about the quality of the investors that you bring on board, whether they helped create a domino effect, or people who are helpful and provided you advice? And, how has that sort of affected your thinking as you built your company? Because, you need capital, but then you need things beyond capital. How do you think about investors and quality of investors as a component of fundraising and building your business?

Sandi:
I think, I might’ve gotten some advice from Rajeev once, that do no harm is a good place to expect from your investors, in the full range of things, right? Because for the most part, your choice of an investor, as long as they do no harm is not going to make or break your business. And, if you’re expecting them to transform your vision or whatever, you’re probably expecting too much. And, many investors can actually be destructive in terms of taking your time resource, kind of meddling with what should be management decisions. So, I think the first bar is do no harm. And then incrementally, I mean, it’s also true that there’s very few… And, what I appreciate, Rajeev and Mayfield is, that they can go the distance from early stage through IPO, but also realistically many investors have a sweet spot of, maybe they’re helpful in the early stage, but they’re not going to be so helpful in scaling the business later.

So at least for me, finding people that I could really kind of trust at the core value level. And, I don’t think it’s, for me at least, both my series A and series B leads had tried to invest multiple times, several years prior to actually allowing them to do so. And so, by the time that the timing was right, I always knew they were in it for the right reasons, that they were true believers in both me and the company. And I think for me, that felt really important. And, here’s where reputations with institutionals – both the partner and the firm – do matter. Because, there’s also cases, and you know what happened already to Skilljar, where sometimes a partner moves on for whatever reasons. And so, what is the firm’s reputation in those circumstances too, of standing by the company and standing by the entrepreneur?

Rajeev:
Yeah, we met Sandi when there were eight people in the company and I tried to preempt an investment in the company, I think, twice. And then, she finally relented and said, “Okay, fine, let’s do this.” So, thank you for that, Sandi.

Sandi:
Well, see, I had such a low view of investors, I didn’t trust any of them. Very bruised from pitching 100s, and especially being in Seattle, which is not an early stage capital rich environment. I think, the good advice is always run a process. And so for me, preempting was hard because I really believed I had to run a process. And then, for a series A, I said, I’m going to have undeniable tractions, so I’ll never have to go through this pain and suffering again. So that being said, I think when I spoke to Christina, I was like, “Take Rajeev’s money, because you can actually trust him.”

Rajeev:
So, let’s talk a little bit about once you have capital, how do you really think about deploying that capital? What are the things that are important to you? How do you sort of think about what’s next? So, you have capital, so what do you do? I mean, what are some of the biggest challenges that you face in starting to build your company?

Janice:
Yeah, I think that’s the most exciting part now that you have the runway, right? You have to think really critically about how you’re going to deploy the resources. I think, probably first and foremost, it’s really focusing on the product and the opportunity. It’s about building evidence for the vision, making sure you can really execute on the value proposition that you’ve defined for the company. I think, that it takes a lot of discipline, I think, as well to define sort of what the roadmap looks like for the company. I think, really being clear on what your value inflection points are. Again, I think it’s really critical to be in a position of strength when you are going to go into that next fundraising round, because as Rajeev pointed out, and Sandi and Christina, I mean, not all money is the same.

It’s really important that you have the leverage to talk to quality investors who will be able to… You have the ability to select your investors, I think that’s not necessarily the case for everyone, but if you are in a position of strength, you absolutely have the ability to say no to people that you don’t feel like are aligned with your vision. And, you don’t have to take the first check that comes through. So, I think being really disciplined on how you’re using that money, bringing in the best people. I think that’s probably number one for us, when we started out, we had the money, we said, look, who would be the best person in the world to help us execute. And that, was kind of where we focus because you can’t deliver on your mission if you don’t have the right people in your company.

Sandi:
Plus one on team, because the day you close your round is now the day you’re raising your next round, in a sense. And, to scale, you need people especially super early, and it is a war for talent out there. And, you need to give that person, the 18 to 24 months to scale the business… For them to assemble their team and scale, and I think there’s a question in the chat earlier about Techstars. Techstars specifically looks for team, right? Because, you’ve got to be able to convince those first… Well, for Techstars, at least one other co-founder to go in with you, at least at the time they didn’t take solo founders. And then, anything capital raise, and I’d love to hear Rajeev’s perspective, but on the investor’s mind is, how are they going to attract the team to take them to the next level as priority one.

I imagine in Janice’s business and some e-commerce businesses, you do have to like pay for stuff. Pay for lab of space, or pay for raw materials, but at least in software, my business and Christina’s business, a lot of it is about hiring people to build things or sell things. And so, being able get that core group together quickly and your selection of those people’s incredibly important.

Christina:
This is one of my favorite topics in the entire world, which is how to spend money and where to put it. It’s part of our mission, so I’m so glad I get to at least partially answer this question, but you have to think of capital or money as your fuel, and you either want to put more fuel into your business or pull back depending on how the business is performing. So, one common mistake I see at the very, very early stages, when people get their first pre-seed capital is actually not spending it fast enough because they want to make it last long enough. You just need to know that when you put that fuel in, what do you expect to get out, and are you seeing those results to determine whether or not to double down. For example, you put money into your business, you hire a sales person or another engineer, and suddenly you’re producing 10X more.

Then, put as much money as you can, as quickly as possible to get to that end state to raise more money. So, you sort of have to start with where is your next stage, which might be your next fundraise, or it might be a certain set of deliverables or milestones, and budget your capital to get you there. But, feel free to spend what you need to take you there, but also know when is the right time to pull back if you’re not seeing the results to give you enough time to meet those end results.

Rajeev:
That’s great, and in all of this ultimately, right, I know we were talking a lot about fundraising, and ultimately all of you are trying to build great products and services, create customers with the hope that eventually you don’t have to raise any more capital. And, that your businesses are getting financed through customers. And so, like everybody said, once you have the capital, kind of really thinking about what other key priorities the business becomes incredibly important. And from my perspective, financial capital, when you raise capital, it’s about turning it into human capital. And, that’s the number one determinant. And, I think while we have incredible opportunity now with remote and distributed work, it also presents a lot of critical challenges.

It is a really competitive market, so thinking really about key hires and being able to move pretty quickly, and making decisions pretty rapidly about things that are working and things that are not working. And, I do believe for most entrepreneurs, they probably spend too little time thinking about hiring. And unfortunately, hiring is a full-time job and you’re a full-time CEO, do you kind of have two jobs. But, that’s I think a pretty, pretty important piece. I think, we just have a couple more minutes left, maybe we’d do a rapid fire type situation here. One piece of advice for everybody in the audience today, maybe Janice, why don’t you go first?

Janice:
Sure, there’s so much really good advice I’ve received since starting. And, I think the one that’s kind of resonated with me most is just make sure that you’re really building your guiding principles and values for yourself, and for your company, and keep asking the why. I think, for me, and I’m sure for everyone else on this panel, that journey is really turbulent and unpredictable. And so, you’re going to experience a huge bandwidth of emotions, right? And, I think if you can understand your why, understand the purpose of what you’re doing, what the company is doing, it’ll keep you grounded and it’ll keep giving you the power to move forward. So that, would be my advice.

Rajeev:
Well said, Christina?

Christina:
Venture capital, if you’re assuming you’re taking venture capital, is a 10X, a 100X business, you’re going big. So, get into the mindset that whatever you’re doing when you’re pitching is big, big, big, your big, your idea is big, what you’re trying to do is big, And, get your head around that as opposed to, well, we can grow two, three X, and have an exit. No, we’re thinking big, so just get your mind around that. And that, was also game changing for me.

Rajeev:
Sandi?

Sandi:
I would say, in a different kind of track, take care of yourself, it’s your company and your ability to sell investors. Candidates will only reflect your own sort of mental and physical wellbeing. And, I know it feels hard, but you are not your company, it feels like your company, it feels like your identity, it feels like every rejection is rejection of you. And so, to keep perspective, take walks, try to eat healthfully, get enough sleep. These things are really important for you to be on your A game, because if you’re not in your A game, it’s hard for your company to be on it’s A game too.

Rajeev:
That’s great, thank you for that, I think that’s pretty spot on and amazing advice from all three of you. And, thank you for letting me be part of your dreams, and living vicariously through all of you. And, I really appreciate all the entrepreneurs here who are trying to change the world and really make an incredible impact. And, for me, I’m always just… I wake up just not even believing that I get to do this for a living every day, to work for each and every one of you. So, thank you so much.

Sandi:
Thank you for having us.

Janice:
Thank you Rajeev, and All Raise.

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5 Essential Moments in Building a Company

Collision: Building the Zone of Trust

Transcript

Alex:
Hello everybody. My name is Alex. I’m very, very glad to be here today because we are not doing what I usually do, which is sit down with a couple of people from the worlds of startups and talk about numbers and money and all of that. Instead, today we’re going to talk about relationships and in particular, the relationship between board members and founders and how they evolve over time. But thankfully you won’t just be hearing from me. We do have two excellent people with us today, Tracy, Navin thanks for being here. How are you doing?

Navin:
Very well. It’s a pleasure to be here.

Alex:
No, I’m really looking forward to this. I think that this is not a topic we talk about enough out loud. I know that founders talking amongst each other, so do venture capitalists, but I think that the actual relationship building between long-term partners is actually under discussed. Maybe the only thing in the world of startups it’s actually under discussed this year, but I want to go back in time to start to set a little context for everyone who is maybe less aware of the Poshmark story, then the three of us are. So Tracy starting with you. Can you tell everyone how you ended up moving to California and then joining the Poshmark founding team?

Tracy:
Yes. I grew up in a New York area. I was very interested in fashion and that was my world. And I came out to the Bay Area to really partner with a really strong technology and business team. And so came to San Francisco and networked around. And this is where the origin story and Navin comes in, really early as I did not know that the Bay Area did not have a whole bunch of fashion folks. There are none. And so as I met, I ended up meeting my co-founder and we still work together today, Manish, and it was via Navin and his firm that really put those two pieces together.

Alex:
Yeah. And that’s why this is so interesting to me because often founding teams meet their investors. But in this case, Navin your crew had an active role in that. So tell us just a little bit about how that all kind of came together.

Navin:
Absolutely. So Manish and I go back to 2003, 2004, and as he was leaving his last company, he and I started spending time together and looking at what to do next. And one of the areas he was very excited about is building a social fashion marketplace, which would be built on the iPhone, on the mobile thing. But one of the things he recognized is, he’s one co-founder short, where he needs a woman who relates to women fashion, which would be the focus of the company. And that’s where we met Tracy through the network in 2010, introduced them. They spent probably five, six months together, and then they came and pitched us in January of 2011. And that’s what led to the series in financing of the first money of Poshmark, the series in financing in January of 2011.

Alex:
So this is where I want to pick up on a more specific question. I’m curious. What about their pitch was attractive to you? I know that you knew the people, but was it the thesis, the economics, what really drew you in to cut that first Series A check?

Navin:
Yeah. So Mayfield is a people first firm. We believe in people first, market second. We believe people make products, products don’t make people. So it’s all about the people. Then we looked at the problem they’re solving and it was really a pain killer, where you help buyers and sellers of fashion to come together through mobile. The third thing we look at is, they were shifting from search based e-commerce to discovery-based e-commerce based on social and the market for fashion is a trillion dollars. So if you scratch the surface and get to 1% of the market, you’re $10 billion in GMV. So that’s what led to us getting excited about funding the Series A at Poshmark, but it started with people and ended with people.

Alex:
So Tracy, now I want to know a little bit about the early relationship building between you and Navin. I know a lot of startups have monthly board meetings when they’re very, very young, some do quarterly, some are a little bit less frequent. How did you guys go about in those early days, getting the level of trust you’d want to have with your earliest investors?

Tracy:
Sure. I’m going to answer that but first. I just want to take a small detour and add to what Navin just said. We can look back 10 years with rose colored glasses. And the truth of the matter is the world was very different when we were pitching Poshmark at that Series A to Navin and his firm. And I want to give Navin a lot of credit because it wasn’t just the market and what we’re going after and all the things that make business sense. What we were pitching was quite, quite innovative. And I think that if you just looked at the idea itself, it might’ve been really hard to wrap your head around committing and investing to what Poshmark is today. And I do think the people first nature of Navin and Mayfield really helped us come together because he could see the passion and the partnership and the team and really behind not just the great idea, but how we really felt like we were positioned to solve it. So I just wanted to put that in there. And now remind me your question again, please.

Alex:
Essentially building the early relationship. Once you were an operating company board meetings, how were you guys trying to get close essentially in relationship sense? Because things are hardest when your company is the youngest.

Tracy:
Yeah. I think one thing a lot of founders miss with their investors and board members is that they are part of your team too. And that, especially in the early days when you don’t have a lot of people to lean on, and a lot of people who deeply understand what you’re trying to build, your investors and your board members are there with you. If you take them with you on your journey and it’s up to you to form that relationship. So in the early days of Poshmark, Navin was another team member, he was someone that we bounced ideas off of. He gave us support when we needed it, intellectual, financial, emotional, all of the type of support that founders need in the early days. So I wouldn’t say it was just about board meetings. Those are kind of the official ways to connect. For us, team is everything and culture is everything. And that’s how we approached our early relationship with Navin and Mayfield.

Navin:
If I could add, right. I have a firm belief when founders are working with founding investors, is the role of the investors to invest in relationships, not transactions. You need to spend a lot of time with the founders in aligning your mental models and assuring them you will be their safety net and you will be loyal to a fault, but at the same time, you’ll practice radical candor. There you’re going to care deeply but challenge directly, and that healthy balance where they know they’re looking out for you. And it’s not only the board meetings where you spend time with them. It’s all the offline time you spend with them, ends up building a healthy relationship and ends up building the foundation off a built to last company.

Alex:
Yeah. But it feels like you guys had a lot of time, and one thing I think we’ve seen in the more recent venture capital world and startup world in the last 12, 24 months has been an acceleration of everything. Even just due diligence has gone from months to weeks to days to now I’ve heard from some investors, hours. So it seems to me, there’s this demand by the market to get to trust so much sooner. Navin, can you get to a comfortable level of trust with a founder pre-investment these days given how fast things are going? Or is that not as important to you?

Navin:
No, it’s extremely critical and there’ll be a lot of investments we won’t be able to do because we don’t know the founders or we are not able to spend quality time with them. Our belief is getting aligned on the mission, the values, and the culture is critical. And if somebody is only interested in our money, it’s not a good fit for us. So we are a firm, which is people first, we believe in investing in relationships and not transactions. And we have to invest time before we invest money. So we’re not in any rush, right. Business building and venture is a marathon, it’s not a sprint.

Alex:
Tracy. I want to ask you about this from the other direction, because Poshmark went through a number of rounds before it went public. And so you had to add, I presume a good handful of people to the board as you went along, did you put the same amount of time into kind of getting to trust with each board member as you did with Navin in the early days?

Tracy:
Well, there’s never, time is a finite resource. So I would say Navin got a head start with many years with us, but I would say that the approach is the same. We think that culture is one of the strongest pillars of the Poshmark brand, whether it’s external to the company or internal to the company. And as I said before, we really think that our board and our investors are part of the team that can help us get to this crazy lofty vision that we have. And so as we added more members to the team, it’s part of building culture. So if you say that the founders and Navin were at the beginning, right. But we had a dream that was much bigger than just us. And so, as you add people, it’s like, well, what can this person add? And what can that person add? And how as a collective team, do we get stronger and stronger as we go? And so that was the approach. In addition to fundraising that we took, as we built out the board.

Alex:
I want to double-click on that really quick, because I’m just thinking about how many startup CEOs telling me that they were juggling multiple term sheets when they’re raising their next round. So it seems like if you’re a founder, money isn’t the problem instead of kind of probably finding cultural fit slash trust within an investor is probably more important than ever given that there’s so many different fundraising options, Tracy.

Tracy:
Well, listen, if you’re lucky enough to have options, then I would opt for culture. Cash is king, and you have to keep your company alive, right?

Alex:
Yeah.

Tracy:
And if you’re building a solid business and you’re building it methodically, then you should hopefully have some options. So I would try to go for all of it, but you do have to make trade offs.

Alex:
Okay. Navin I want to move this back to you for a second, because I’ve heard about somethings that investors are doing during the pandemic because it’s shaken up the ability to get coffee and so forth with people. And I’ve heard about venture capitalists, playing video games with founders to establish a deeper relationship. Virtual HQ’s are a big thing. So are those the outliers that I’m hearing about when it comes to kind of founders and board members getting closer or are those things relatively common when it comes to really trying to get to trust for early stage company?

Navin:
I think it’s a hybrid. Some people and some venture firms are getting complete comfort doing this virtually. And then there are firms like us, which are using a virtual model where you start building a relationship and start having conversation with founders, or then you figure out how you can over them on a socially distant hike, how you can get them to your home. How can you get to the bottom of who they are, what their dreams are, what their passion is and figure out, you’re a services firm at the end of the day, how are you going to help them achieve their dreams and mission? So I think it’s a hybrid model, but every firm is different, right. One has to be comfortable with what their business model is. You need to believe in your model, your north star and follow that. And to me, since business building is a marathon. It’s not a sprint, spending that time upfront is so critical, so critical. And I tell the founders, don’t just get gamed by what the VC’s saying, go check them references on them, whether virtually or, and you can go on LinkedIn, you can go on PitchBook and see who they are. Really understand because entrepreneurs are going to have choices, really understand who’s going to be with you when things don’t go well.

Alex:
Right. Or who’s going to take credit for it all if things do go well, which is another particular issue we don’t have time for today. Tracy, I want to go back to you and talk about board diversity. One thing that I keep hearing a lot about is bringing on increasingly diverse voices to cap tables. And I’m curious amongst your founder friends, how much does that come into play when it comes to selecting net new board members for companies as they scale?

Tracy:
Well, it’s what you intention. So for us, that’s very important, particularly because what we have built and what we continue to build is something new and it hasn’t been done before. And so we do really benefit from various voices and perspectives. And so bringing on board, Jenny Ming, who is a retail veteran to help us think through scaling Poshmark, beyond where we are today, bring onboard Serena Williams, who is a powerhouse entrepreneur, fashion label producer. And also just how to build brands and to connect with audiences is a perspective we had, but she brings so much more there. And so since we’ve added some different voices to the table, the conversations have come to life and have changed. And so I’ve seen firsthand, not just in building diverse teams, but also like I said, your board is part of your team. So having that perspective has been very helpful for us in the later years.

Alex:
Yeah. So Navin, I want to take this back to you for a second, because you were talking earlier about going on distance hikes with people, having them over your house, kind of presuming a lot of locational proximity, that you’re going to be nearby. A lot of VCs also talk about pattern matching and trying to figure out kind of what might work based on past results. And I wonder if those things don’t in a sense accidentally discriminate against more diverse founders who may not be in the Bay Area, for example, or who may not have the exact same kind of like pattern matched background. So how do you go about building trust with founders who may not fit the kind of usual rubric that you see or that you’re kind of most comfortable with to kind of get out there and invest in more diverse people?

Navin:
Yeah. And I think in today’s world, right. Like there is easy ways to check founders. You’re only one or two degrees of separation away from them based on common connections. But then we have a strong conviction of embracing the unconventional, the different and the unusual. And we believe it’s often the founders who don’t come out of central casting that have the grit necessary to succeed against seemingly insurmountable odds. And at the same time, we have another belief that great people evolve. Almost no one comes into the job, but all the skills and experience they need, this is where our role as a coach, as a VC can help them grow as long as they are continuous learners. So the amount of time you spend, it may not be physical, you can reference check them, but have candid conversations and say, what drives you? What are you looking for? What does success look like for you? Have you made tough decisions? How do you value teamwork? So I think it’s more of a psychology test and it may feel we have an x-ray on founders where we look at who they are rather than looking at their metrics and really studying them and making sure these are the people we want to invest our time and money in and help them grow and achieve their dreams.

Alex:
Navin I want to stick with you for one more. We’re a little bit short on time. So I’m going to squeeze in a couple of quick ones here. I was actually playing video games with a Midwest based seed stage VC last night. And we were talking about when to leave boards and I wanted to bring this to you because he said that he doesn’t really stay on boards past Series A, that’s not really his domain of expertise and so forth. So how do you as a founder or maybe as a different board member, remove board members over time as maybe the company evolves past their expertise without breaking the trust that you had as a group and they were active on the board itself?

Navin:
Yeah. So I think let’s look at the Poshmark situation, right. I have such a close relationship with the founders. I’m going till the end. IPO is just a financing event. I’m there for as long as they need me, today we are the largest shareholder, a year from now we may not be. Where the services from our job is to help them, but there’ll be other where more independent board members can fulfill the need. Then we can post the ideal. Then you transition, but we are loyal to a fault. We are committed for the long run, but it’s all dependent on the founders because if they need something that may feel that I can’t offer you step back. But if he can offer that you continue on the journey. So it’s a collaborative decision rather than just saying I did the Series A, I need to stay on it.

Alex:
Got it. Tracy does that square with your experience as a founder? Does that make sense?

Tracy:
It does and all your questions tied together. It’s, if you can build your board to want to have you win as the number one goal, then all of this just comes, right. And everything else, it might be ups and downs, but these decisions are easy when you have the same goals in mind, when you get into a lot of trouble. And a lot of the horror stories that I hear is when those goals are not aligned and that was never a mindset to begin with. It was more about, I need cash, let me have a cash infusion. They looked at their board members as transactional people and not as a person, what does this person want to see from me, et cetera.

Alex:
Yeah. So we have time just for one more, Tracy, I’m going to leave us with you. So thinking about more red flags, just for all the founders out there who are listening in right now to us, what would you say are a couple of things to watch out for that are potential negatives and maybe even some positives amongst board members, as they go out there to raise more capital and pick their board member team.

Tracy:
So I think there’s a simple thing that a lot of people don’t do as you are raising money, as you are looking to add to your board, do you want to spend a Saturday afternoon with this person? Do you like them? Can you trust them? We have really good instincts. We can decide that you’re talking about short investing or due diligence timeframes. We know within five, 10 minutes, whether we think we can trust someone. And so we have this skill, use that skill and apply it during this circumstance. And I think it’ll serve you quite well.

Alex:
Okay. Well, Navin, Tracy, sorry. We have to wrap it up there and throw it back to Toronto. I had a bunch more, but sadly that’s all the time we have. Thank you much.

Navin:
It’s a pleasure being here.

Tracy:
Thank you.

Navin Shares Lessons Learned from his Journey at TiEcon

Scientist Entrepreneurs – Scaling Breakout Engineering Biology Companies

Biology as technology will re-invent trillion dollar industries and enhance human and planetary evolution. In this session at TechCrunch Early Stage 2021, two early-stage investors and company builders, Arvind Gupta and Ursheet Parikh, connect with leading author and seed investor, Po Bronson, Managing Director of IndieBio. They share their playbook on scaling start-ups touching upon three seminal areas which influence trajectory — fundraising, hiring, and product design. Their insights draw on their experience with companies including ingredients-as-service leader Geltor, which raised a $91 million Series B in 2020, CRISPR platform Mammoth Biosciences whose dream team includes co-founder Nobel Laureate Jennifer Doudna, and Endpoint Health, started by the founding team of GeneWEAVE (acquired by Roche) and former YC Bio Partner Diego Rey, which is designing a new class of therapeutic products that focus on hospital conditions that kill as many people as cancer.

Transcript

Po Bronson:
Hi, welcome. I’m Po Bronson. I’m the managing director of IndieBio, and a general partner at SOSV. And in this hour, I’ve got two wonderful VCs from Mayfield, Ursheet Parikh and Arvind Gupta, who lead their engineering biology practice. And today, we’re going to talk about something dear to everyone’s heart, building companies to make an impact on human and planetary health, which this year has really reached a crisis stage. Hi, Arvind. Hi, Ursheet.

First question to you Ursheet, and then to Arvind, just introduce yourself to our audience, but I want you to finish with a quick lightning round. Drop in no more than five companies you’ve done that exhibit your work in this space.

Ursheet Parikh:
Sure. Well, good to see everyone. I am a former entrepreneur. Actually, a Mayfield entrepreneur who joined Mayfield in 2013. I invest in enterprise technology, and then with Arvind, co-lead our engineering biology practice. It’s great to be in this particular practice because whether we are investors in a company or not, we really want everybody we meet, every company in the domain to be successful because it makes all of our lives better.

And to your lightening round question, Mammoth Biosciences, Endpoint Health, Nesos, Mission Bio, and Qventus are some of the publicly known companies where I’ve had the opportunity to champion founders and leaders.

Po Bronson:
Thanks, Ursheet. Arvind, follow up as well to you.

Arvind Gupta:
Gosh. So my background is genetic engineering. I’m also a designer. And blending those two background together, had the idea to start IndieBio, which I founded in 2015. And the whole premise is that scientists can become entrepreneurs and build product driven companies that can change the world. And that could extend beyond just therapeutics, into worlds that people hadn’t previously imagined from food to fashion and beyond.

Recently, as Ursheet and you’ve mentioned, I joined Mayfield. I’m very proud of that. I’m very proud to work alongside Ursheet and Navin and others to extend that mission and to drive more capital and more resources into that purpose.

Po Bronson:
Okay. Lightning round, remember five companies.

Arvind Gupta:
Five companies. There are so many. I’ve invested in over 150 companies. Five off the top of my head. Let’s see. Memphis Meats is really well known. Michael works, Geltor, Prelis, and NotCo.

Po Bronson:
Awesome. So it’s fascinating, because to both of you, when you describe these companies, we all know you are both taking a lot of risk. You’re going into areas the world thinks it was risky. Ursheet, sepsis, the brain, CRISPR. Arvind, barely know where to start with you, but human immune system, outside the body, leather without the cow, first VC into cultured meat. Tell me a little bit about your feelings about risk, how much you like it, how you manage it.

Ursheet Parikh:
Go ahead, Arvind.

Arvind Gupta:
So my whole life has been about managing risks. And not many people know this, but I was a base jumper and I don’t base jump anymore, but a rock climber. I’ve climbed El Cap. And it’s really not about getting away with it, but it’s about figuring out how to do it safely. And that’s carried over into my venture career and in doing improbable things. I oftentimes see founders that say or show what they’re doing and you’ll be like, “Well, why tackle that problem when the much bigger problem is right next to it and you can easily do with your technology and your mind?”

And they say, “Well, most VCs tell us that’s more risky.” Well, what’s riskier, going after the smaller idea that isn’t going to go very far, even if you’re successful, or changing the world with what you can make and what you could produce with your own mind and creativity? I fully go for the latter. I think that is where the right risk is. And it allows everyone to align. It’s not about trying to make some money. It’s actually providing value to people that could change our lives. And in doing so, using capitalism to fight the old capitalism that has led us down to the path we are, which is ruinous destruction and climate change, which is upon us.

Po Bronson:
Ursheet, what do you think of that, and how do you think about risk? Same way?

Ursheet Parikh:
Actually, I think it’s a little bit of a mirror image, but very consistent. We personally look at a lot of these problems. And when I look at the problems we have with regards to global health or the health of our planet, they are the biggest entrepreneurial opportunities of all time. There’s no fixed formula around on it, but two things really stand out for us in the way we look at it. The first is it does start with people, and it doesn’t matter how awesome the starting technology is. People are the ones who build the companies. So really understanding them, their mission, how they operate, how they learn.

Two of the most important attributes in entrepreneurs that probably are not spoken about enough is intellectual honesty along with continuous learning and the ability to learn. Because entrepreneurs just go on to do amazing things. To do that, they end up having to learn a lot in a very, very fast time period. The second thing is it often requires some really good first-principles thinking. It does require understanding why the world is broken the way it is. You cannot necessarily ignore it. You want to make new mistakes, not the same ones that people have made before, but it does require first-principles thinking.

And so when we were partnering with Jason, Diego, and Leo Teixeira worked for Endpoint Health, they had been on a mission to save lives for the top killer in hospitals, which is sepsis. And it really started with understanding why that was happening. And besides the core understanding of the disease, the business model of that category of therapeutics was broken and so it required a new way to look at it. When we saw CRISPR, it felt like a core bioengineering technology. And rather than our company trying to keep a monopoly on that technology, it became much more about enabling an ecosystem to build many new applications with such a platform. You get a similar bioengineering platform.

When we were looking at Nesos, it was the realization that therapies for the brain diseases are so far behind say other areas. And it’s maybe because we might be looking at the brain all wrong. Think about it. The brain is reshaped every time you sleep, train, hear, talk. And at the same time, it’s designed to be different from animals, so the classic drug development may not work. And it’s also designed to not take a lot of new drugs. And so maybe there is a new version of therapy that is actually understanding the communication language of a nervous system, which is electrical signals, and using that to unleash the power of the brain to control the immune system.

And so as crazy as it sounds, these were some of these first-principles starting points with amazing people and partners. And then as Arvind said, fundamentally, it’s about managing risk. So where do you take something from science, which is not what the entrepreneurial ecosystem is set up well to find. It’s not science, but it’s like taking that science into a product that actually really can then become the basis for a business. And then building a platform company. Those are the things that we love to partner with people on. But yeah-

Po Bronson:
So I want both of you to apply to this, but stick with science just for a sec, because we are going to get to scaling business. But Ursheet, you said something fascinating to me last week. A lot of VCs, we talk about programmable biology, but you took it to another level. You were like, it’s programmable, but it’s programmable and far more than genetic code. It’s programmable with any form of energy. And I think you were just speaking to that. I thought it was brilliant. What are some other examples of how we can program biology, not just with the genetic code itself?

Ursheet Parikh:
Correct. So I think if we look at biology, biology as it exists on the planet is responding to many, many different forms of energy. I was just talking about how electrical signals end up being that you can have the same thing happening with light. You can have the same thing with materials. And then if we go back and look at traditional cultures, they’ve had different attributes of how just wellness and other things play out.

I think the key is if you have to take ideas or concepts which are not mainstream accepted and make them real, the onus does end up becoming on the company to actually create the evidence and create business models that can sustain the companies through leading that change and really creating a movement and then getting everybody to board and join that movement, but … Sorry. Go ahead. I really wanted-

Po Bronson:
Well, no, that’s good. But Arvind, I’m going to push you now. Let’s talk about scaling a bit. It starts with the fact that a platform isn’t a product. Everyone wants a platform, but it’s not a product. And you said to me the other day, there are no biotech companies. There are only consumer companies and enterprise companies, which that was a hot tick, and I want you to unpack it for people.

Arvind Gupta:
It’s less of a hot tick and more obvious. So when you really think of … Biotech is simply a foundational technology. It doesn’t imply any value creation. Consumer companies focus on products that end people use and buy, whether it’s in stores or wherever. That requires a full value stack. That requires communication of what the product is. It requires all of the things that are necessary for a solution to a problem that a person has, getting into their lives.

And likewise, I can ask you, is … The same thing for an enterprise company that’s doing ingredients into … Is it a biotech company? No, that’s just their technology. That type of company just has a different sales channel. It has a different end customer. That end customer is a business with different margin structures. So how you design the business from the very beginning is completely different.

And if you don’t design the business from the very beginning to match the product and the end customer, you’re hosed, because you’re going to run out of runway, you’re going to have to pivot around. It’s going to cause all sorts of heartache and real issues. I learned this from Ursheet, and I learned this from Mayfield really. As I was going through all the IndieBio companies, as they were scaling, it was a real opening eyeopening experience for me. As they started to hit the market realizing, oh, actually, distribution channels, putting chemicals on trains and the volume it takes directly affects your margins. Because how many train cars do you need to lease?

So it gets mind blowing. And so if you don’t think about all of these specific things in a margin structure that makes sense for your business, you don’t have a business anymore, and therefore you don’t have the change you can create. We’re using capitalism. One of the reasons I joined Mayfield is Navin coined this phrase, conscious capitalism. And you and I, Po, wrote about it in our book as fighting capitalism with capitalism.

Po Bronson:
With better capitalism.

Arvind Gupta:
With better capitalism. And that’s it. And so it’s about building these businesses in the right way. And going back to the programming biology with anything, Ursheet talked about making movements right at the end. And I want to make sure we put a pin in that, because if you abstract it all the way out, to create movements, you’re actually reprogramming biology with culture. So you could extend all the way, and-

Po Bronson:
I like that. You’re reprogramming biology with culture by collective mass movement that’s inspired by the companies and the founders voting with their dollars-

Arvind Gupta:
That’s exactly-

Po Bronson:
… and their culture is literally reprogramming the sustainability of the planet. That’s fascinating.

Arvind Gupta:
That’s what we’re doing. And whether we recognize it or not, everyone in our industry, that’s what we’re doing. And when you see news articles and industry reports about making weather without the cow or whatever product you’re reading about, that’s what’s happening. It’s a reprogramming of society. And-

Po Bronson:
I’m going to interrupt you. Because I’m the host, so I get to do that to keep us on track. Because I want to establish how much this contrast is there or not. Obviously, where engineering biology has taken biology is into lots and lots of markets, but you’re still firmly rooted in human health. And so let me ask you how different the engineering biology practice at Mayfield is than traditional biotech. So one might say you’re reinventing the economics, reinventing the nature of the risk, or one might say, “Hey, it’s biology. There’s always huge upside and fundamental risk there.” So in your minds, do you feel like you’re doing biotech, or life sciences, or do you feel like you’re doing something different? How unique is it?

Ursheet Parikh:
So I think we have the benefit of being at a firm which has been in business for over 50 years, has had a chance to create profound companies in biotech itself, the Amgen and the Genentechs, and the Intuitive Surgicals of the world. But in the current incarnation, the genesis of what we are, we really started with the mission of transforming human and planetary health. And that has been a big thing. So in the clean tech era, one of the best companies at the clean tech era, before Tesla or SolarCity, and that was an example of a company that had happened.

But if we are thinking about it, we think about just as you can program biology with many things, ranging from drugs, to electricity, to light, or any of that. To transform human and planetary health, there have been other technologies that have existed. There’s been Silicon, there’s been software, there’s consumer companies that we have like Grove. There’s companies like [inaudible 00:15:27], which are of cycling. There’s companies like Tonal, which are really about transforming consumer health and that sort of things as well.

And so one thing I ended up learning from Arvind five years ago is to really start thinking about biology as a technology that can be used to solve this full set of problems. And then as we start looking at this as a additional technology to solve these problems, fundamentally how we think about company building differs from traditional biotech as follows. In traditional biotech … And it wasn’t like that. So if you look at the startup biotech, when Amgen and Genentech were funded, they were not funded to create an asset and then sell the company.

So traditionally, biotech was also like tech to go build companies. Then in the ’90s, as the tech and the bio innovation space changed, a lot of bio-investing and the entrepreneurial and venture ecosystem really became about taking a project off and coming out of academia. Funding some additional clinical research on it, taking the data and then selling the asset. Now, one thing that we’re really passionate about at Mayfield is if we are going to have the solutions for human and planetary health, they’re not going to come from a lot of the large companies who’s watched these problems have emerged in the first place.

So we’re going to have to have a set of entrepreneurs that build the next generation of lasting companies. So now, if we have to do that with engineering biology, it can’t happen in a traditional biotech model, because as soon as you flip your asset, your mission’s lost. It’s become a cog in the wheel of a different entity. And they just are not going to be able to really make the automation their own. And so then this starts with the very foundation of the company.

How do you get the stakeholders aligned for the long haul? How do you design your business? How do you set up that culture? How do you think of your technology as not a project, but a product? How do you get it to market? How do you then show commercial scalability? How do you raise the capital, run the industry conversation out on that? And how do you build a commercial org to get success with your first product? Then you take that footprint and get a lot more product in the pipeline and partnerships with the ecosystem to really create a platform and a company.

And none of the success is accidental. So it’s great to be in this time where despite COVID in the last 24 months, we’ve seen several of these platform companies make it in both planetary health, as well as human health and collective consciousness. And it is to try and see how we can go ahead and engineer company building. And-

Po Bronson:
We’ll come back to COVID in just a second, but let me stick with what you’re describing about alignment. And let me ask this question in the form of just two words. Lightning round question. I’m going to say two words, and then Arvind, you can start. I just want you to react. Alrighty? Two words. Mission driven.

Arvind Gupta:
Founders.

Po Bronson:
No. You don’t get one word. You got to react. This isn’t a therapy, man. Expound. Mission driven. How do you think about mission driven? Every wants to be mission … How do you think about it?

Arvind Gupta:
So mission driven. First of all, the first thing that comes to you is founders, because it’s the founders’ mission in the end. It can’t be mine. And so I think often times, venture capitalists will project what they want onto others, “Arvind, you can do that.” So first of all, I’m excited to meet founders that are mission driven, that have the ability to start movements, to program culture, and reprogram society through their actions.

I’ve seen it many, many times in companies I’ve founded. And so there’s a obsession with those types of founders about the end consumer or customer that they’re reaching. They have to feel like that is their goal. Not the gizmo necessarily that’s going to get them there. The gizmo could change, but the end customer or consumer, and giving them a better life that results in a better society or better future, those two things, that Venn diagram that’s in between, that is the sweet spot when I think of mission driven.

Po Bronson:
Ursheet, how do you think about mission driven?

Ursheet Parikh:
I think it’s mission ahead of everything else. It also means that it literally translates to entrepreneurship because there are a few things out there, few constructs that can allow for the change that is needed to realize the mission the way entrepreneurship can. No amount of publishing papers, no amount of nonprofit boards and conversations will go out and do that. And then that moves to this built to last. Because realizing that mission just cannot happen in a short time, and so it does require great tactical execution, but amazing strategic thinking and just always doing the right thing.

Po Bronson:
Let’s use an example. So I want to give you one. It’s quite an interesting story, so with Mammoth Biosciences. You all became the first CRISPR product to market, which is amazing. And with COVID testing, an incredible pipeline of partners there for Mammoth. But not that long ago, when you started with Trevor it was going to do STD testing and it was going to be 2024 before it reached the market. So how did you get from that plan to what you incredibly have done today? That’s scaling in a way that we often don’t hear in this industry.

Ursheet Parikh:
So when we met with Trevor for the first time, his mission was where he saw that CRISPR was a technology to program life in one way. To read and write and edit the code of life. And his mission was that the long-term company would be something that powers the whole ecosystem, like Intel Inside. In fact, they literally had a version of that Intel Inside logo that they had in that first step. And then as they were given feedback by the entrepreneurial ecosystem, it was something that had to be put away, maybe in the appendix and not early on. And so they took that feedback and figured what would be the first insertion product and came up with what would be an STD test that would be in the consumer self pay model that could come to market faster?

So that is how they were … The opportunity we had was to really understand what they wanted. We participated in their seed round and then spent a good amount of time trying to peel the onion on the core vision. And then it became pretty clear that what we needed was a CRISPR platform company. And to that effect, while the company had licensed something out of UC Berkeley, they needed a core innovation engine, and they needed a lot of the heft on the IP side.

And so we got into a conversation with Jennifer Doudna and shared our vision. She had a certain direction and vision back then. And there was another company that was coming out of her lab. Two of the best graduate students she had out in her career. And you could see that these founders were quite aligned in their mission and direction. They wanted to get it to market. While CRISPR was coming with therapeutics everywhere, they wanted to see the impact in patients. They felt diagnostics was going to be a fast way of doing it.

But the core thing, the conventional wisdom was to a diagnostics company or a therapeutics company. And it wasn’t recognizing that this technology was starting with a CRISPR innovation engine that would find new CRISPR systems, develop new CRISPR systems for different applications. And then diagnostics and therapeutics were just two applications. There are other applications in ag and then bio-defense and a range of other places. And so we were able to go ahead and align on that mission, and then design the company and the business and all the stakeholders on that journey, form very deep trust relationships.

One thing that people … It’s like when you have very deep trust between the early stakeholders, founders, investors and other advisors and mentors, it really allows for an exponential speed up. It’s one of those slow down to speed up things. And so the whole process to figure this thing out, this business design, we weren’t doing a lot of science at that time, but it took us three to six months to figure it all out. But when that happened, you can see three years since, the company has accelerated so much. And about a year ago when COVID was happening, they were so well poised to actually go ahead and bring the first CRISPR based products to market with the COVID test.

And the recently launched COVID CRISPR test from them increase the actual capacity of our country to do COVID testing by an order of magnitude with the existing labs. So I think it’s a privilege to have been in those conversations and to have enabled in our way the pharma’s vision. And there’s a lot that goes into this. And as I said, it takes a village to-

Po Bronson:
Well, let me give Arvind a chance here to add some of this. Because Ursheet, you talk about essentially being on a team with the founder. Arvind and Ursheet, you guys are on a team. And Navin and Tim is on your team in this space. Arvind, you’ve known the guys at Mayfield for at least six years, but nine months of working together. Ursheet earlier mentioned stuff he learned from you and what you’re doing at IndieBio. Tell us a little bit about you’ve been learning from them at Mayfield since you’ve been there.

Arvind Gupta:
Man, it’s been a massive learning curve, as you could imagine. That was the goal of working with Mayfield, and that goal is being accomplished. I think one of the biggest things is really understanding how to topple incumbents. Truly thinking all the way through. Not just getting these companies started, but all the way when it gets me into the nitty gritty, how do you keep … You’re getting the success, the incumbents want you out of there. How do you keep going and not become part of the problem and get shuttered? How do you go around that and make it all the way to IPO and then continue in the public markets and continue to create value dependably?

That’s the timeframes we’re talking about. That’s the timeframes that Ursheet, Tim, and Navin have built value in companies, literally. That’s something that’s rare and something that I’m excited about continuing to learn. And it’s different for different companies, it’s different for different founders, different industries. And so it really requires this long-term thinking and this ability to build, not just in, “Okay, we got to get a series A company funded,” or, “It’s series B, we got to get it funded.”

A, funding is not success. It just allows you to play a little bit longer and achieve your goals. And so if you don’t have clear goals and ways to achieve that long-term thinking, you’re getting sloshed around by turbulent seas and you end up drowning usually. But with that long range purpose North Star, you could chart your own course and make it all the way through. That to me is really exciting. And that’s what I’ve been learning in spades and I could write a book about it.

Ursheet Parikh:
Decoding the World is a nice book. That was a fun book.

Po Bronson:
Thank you, Ursheet. Really appreciate it. So you’re describing the challenge of knocking off incumbents. Do you have a framework? You guys just get to know you’re coming one at a time? Do you have a playbook here? Boy, who wouldn’t love to know how to knock off incumbents?

Arvind Gupta:
It is a playbook. I’m not sure. Some of it can’t be shared here obviously, because these are the learnings of the past 20 years. Navin was one of the very, very few venture capitalists that made money in the clean tech 1.0 wipe out. And there’s some very distilled learnings and a playbook that’s come out of that. And that’s directly being used right now in some of the companies we’re using. And so it’s good.

Po Bronson:
I don’t want to push too much. Let’s go with as you mentioned, because you just mentioned clean tech and making money in clean tech. One of the only people. A few. You’ve been doing human and planetary health for quite a long time. A lot of people are just jumping on to it today. Recently. We say, how many carbon funds have we seen in the last year? You guys have been doing this a long time. So I’m curious what’s your newest evolution of your thinking here around doing companies to make an impact on planetary health?

Arvind Gupta:
Specifically on the planetary health side? I think really making sure the latest evolution first to market, understanding that there are more markets than just food. I think that people are just starting to wake up to that. Michael Works is a great example of the first breakout. There’s going to be many, many more. Think of it this way. If a lot of this behavioral change, social reprogramming that we’re talking about is occurring because of climate change, what you eat immediately goes in your stomach. What you wear doesn’t. That is a billboard for what you stand for all day long. So I’m going to leave it at that, and you can imagine where these things go.

Ursheet Parikh:
I’ll definitely say the one thing, and we’re beginning to see more and more examples of that. I have a teenage daughter and she often … And it’s amazing how much she really worries about what’s happening out with the world. And really what is more worrying is that majority of the world doesn’t care. But guess what, there is a subset that does. And so if you can enable them to vote with their dollars on your innovation, then they become the people who program the culture and make that change happen.

And so the business design, often a lot of companies are made by scientists and entrepreneurs, and the right engineers. And so there’s a strong desire to just go and build a set of things. But I think if you could get the business design right, so those constraints bring focus and that helps actually make the problem narrower. Sometimes it can expand. You have to do a set of things more, but then you think about what all can you leverage. But the point being those constraints bring so much focus that it actually creates for a lot less trashing data and a more successful company.

So I think in the newer incarnation, we definitely encourage entrepreneurs to think about how, just because we are doing the right thing, people will buy it or will follow versus who really cares about this and how do we enable them to vote with their dollars. And people, organizations, whoever that may be.

Arvind Gupta:
That’s right. That’s a real focus for us. I could say for all the founders out there, they’re building product-driven companies that have an angle into impacting climate change or planetary health. That’s what we do.

Po Bronson:
Ursheet, you mentioned this earlier, that time of the pandemic altered things, is often called the great accelerator. Certainly pushing people online and watching more Netflix and the like. How has it impacted the human and planetary health sectors?

Ursheet Parikh:
I like to call them the silver linings from the COVID era. I think the first is we’ve had the e-commerce moment in healthcare. It had been building up for a while, and the technology was all largely available in there, but it just required COVID to get people to break out of the habit of always asking to see patients in person. It never made sense from a first-principles perspective to take an infectious disease patient and get them in to the clinic rather than seeing them on the telephone.

But not only that, it makes a case for making health equity happen much more easily. It’s a luxury to be able to take two or three hours off from your weekday to go see your doctor for a preventative care thing versus the … And there’s a lot of people who are working hard to make ends meet, who just don’t have that time. And so the convenience that comes along with the ability to get your medication quickly. So I think it’s going to be a big factor in changing practices to make our care system better and lower cost.

But the other thing that also it did is it changed processes everywhere, not just … Even at the FDA, for example. We had two fundamental platform technologies to get their first products to market during COVID. mRNA vaccines, they’ve been trying to get the cancer vaccines to market for seven, eight, 10 years, and we were able to get a vaccine to market in a year or less, to hundreds of millions of people within a year. And then CRISPR’s first clinical products as we’ve seen come in with diagnostics.

So I think these things happened not because the scientists were working as hard, but a lot of the large company ecosystems that you depend on to build the products or the government processes and practices. They evolved as well. The other thing it did is it also accelerated transformation in other industries. For example, wellness in the home. A company like Tonal and Peloton. You saw that break out. But as people spent more time in the home, they started caring about what products they’re using.

And there’s a company called Grove which actually gives you cleaning products that are better for you and better for the planet. And that’s an example of a company that really broke out. Initially it was because people couldn’t go out shopping as much or they were afraid, but then the other part is even as COVID is coming more and more in control and business continues to grow. Because people can see, why do you need to take so many petrochemicals and have them in such proximity when there are better other alternatives that could work as well? Why do you need packaging, which is this big versus you could have something this small and just add water to it and things like that.

Po Bronson:
It’s interesting. I love how you’re elucidating all this. And I like the framing of silver linings very much. But I want to acknowledge that we probably have a lot of founders interviewing audience. These are spirited people who the world probably hasn’t heard of at least yet. So for both of you, let’s imagine … Arvind, you’ll start with this one. Let’s imagine they get in a room with you. All right. So give me some red flags, some no-nos. And what gets them a second meeting with you?

Arvind Gupta:
Oh, gosh. Well, one, you have to be mission-driven. And that’s hard to fake. I think really, really focused on the customer, really care about your innovation making into the world rather than proving your innovation can work. Those are two very different things. And I’m looking for founders that are talking more about how they see it getting to people and changing their lives and what that world will look like. Then let’s go talk for an hour and a half on how brilliant I am. I know you’re brilliant. I know you’re brilliant, but I want to see the world change.

Po Bronson:
Little less prove me it works, and a little more prove me people care.

Arvind Gupta:
There’s plenty of time to prove that it works. You asked for the first meeting, the first thing that matters is if it did work, whose life changes, and does that sum up to a world changing? Does history change?

Po Bronson:
Ursheet, for you, red flags, turn-offs, or other things that you particularly love to hear?

Ursheet Parikh:
So I really don’t have a set … So I don’t have a set formula. I can share a wishlist. But I’ve had the great fortune of working with founders who’ve come right out of college to founders that have gone on to take products to market, to commercial scale, and companies that are billions of dollars. Constantinos, Nesos, or several other folks like that. I think on my wishlist is in that first meeting rather than tell me what you think VCs want to hear, telling us what’s really in your mind, what you want to do, why you want to do it. Recognizing that of anything that anybody can choose to do, entrepreneurship is probably the hardest thing to do.

There is just easier ways of making money than entrepreneurship. So it does start with a certain degree of authenticity and then a certain willingness to engage in conversation and learn. And not everybody is everybody’s going to be great at everything, but we clearly want to walk out of that thing feeling really healthy, respect for something that you are doing, or something that’s new or novel or something that I learned in conversation that I probably wasn’t aware of.

And given that one of the best privileges of our jobs is we get to learn from the smartest people every day, which are the entrepreneurs changing the world, if we try and say something, it’s really coming with the intent of enabling their success. I think that Arvind, you know there is a promise that you don’t have to worry about what we say versus what we mean. And it’s coming right … As what I said at the beginning of this session, anything that is said is coming really with the intent of whether we are investors in the company or not. We want the company to succeed. The entrepreneurs really are the ones who change the world, make our lives better.

Po Bronson:
So I think you identified something. And we have less left, but I just want to hang here for a second. Is the founder ready really for the life of an entrepreneur? Now, that’s an internal state. How does an entrepreneur themselves know whether they’re really built for this or not? Is there any way that you’ve found to work with them to help them understand whether they’re right for this, Arvind? You’ve got less than 30 seconds.

Arvind Gupta:
I think don’t think, do. You’ll find out along the way. It’s like saying, “Am I ready to take a grappling match?” Go, find out-

Po Bronson:
I love that answer. So thank you Ursheet and Arvind and the engineering biology team of Mayfield. Thank you for spending time with me today. Really appreciate your insights in this event for TechCrunch. Thank you very much.

Arvind Gupta:
Thanks, Po very much.

Ursheet Parikh:
Thank you everyone for listening.