MEET THE DEALMAKERS
We all know the stats. Only 2% of venture funding went to female founders, and just 8% of partners at the top venture capital firms are women. But in honor of International Women's Day, I decided to highlight something else — the people behind the stats.
Since I took over this newsletter in August 2017, I’ve conducted 49 interviews for the Term Sheet series ‘5 Qs With a Dealmaker.’ Of those, 21 have been with the industry’s most powerful female investment partners. (To recommend someone for the series, email me at email@example.com.)
Below is a compilation of their nuggets of wisdom:
On the value of operating experience:
“By the end of my time at the Pinterest, I joked that I felt like one of these veterans that you see in World War II movies. They would be sitting there, smoking their cigarettes when a little bomb goes off. All the new recruits run for their guns or jump for cover, while the veterans are still smoking their cigarettes. By the end of your experience at a high-growth company, you’re the veteran smoking the cigarette. And that’s who you want on your board. You don’t want the person who is going to be jumping for their gun or running for cover when there’s a little bump in the road because there will always be bumps. You want the person who isn’t frazzled by it and is always focused on the long-term. You can get that from 20 years of being a venture investor or from a few years of being an operator.” — Sarah Tavel, Benchmark
“Having been a founder, I think I’m more optimistic because I feel like if I could do it, the person in front of me can make it happen too. I also think it makes me more empathetic — especially in the fundraising process but also during the different inflection points in the lifecycle of the business. It makes founders more comfortable to reach out to me knowing that I was recently in their shoes.” — Hayley Barna, First Round
On investing in the time of SoftBank:
“I think what the Vision Fund has done has created this layer of ‘super-haves.’ And the ‘super-haves’ are almost untouchable in a way because they’re in a whole different stratosphere from a competitive perspective. If you are an early-stage venture fund, you have to be thinking pretty hard about, ‘I hope I’m backing the company that ultimately becomes a ‘super-have’ because they seem to have an unfair advantage.’” — Patricia Nakache, Trinity Ventures
“I tend to like that SoftBank is going after the category leaders, just like we are. They know who those are by the time that they’re investing and putting a ton of money behind them. They’re making very big bets obviously in each of the leaders in the respective markets, and it’s a very good strategy. Does it make our jobs tougher as growth investors? Yeah. It just means we need to be there before SoftBank is. We need to find the companies earlier.” — Chelsea Stoner, Battery Ventures
“It’s almost a completely different business. They are basically looking for the one deal in a decade. We’re very lucky to be in Airbnb, but that’s not the game I play. The game I play is that there are many entrepreneurs who are building thriving businesses that are going to get great returns. If you want to return money to your investors, being capital efficient and raising small amounts of money is actually the wiser thing to do. I know it’s not super popular to say that in Silicon Valley, but I do what works.” — SC Moatti, Mighty Capital
On the conviction to bet on a company others shy away from:
“Before investing, we ask ourselves three questions. The first is ‘why now,’ which is critical for deep tech investing. The other thing we spend a lot of time thinking about is whether this is feasible in the time frame that is conducive to venture capital. If a founder says they’ll spend 15 years developing something, it doesn’t work for the model. And the third question you ask is, ‘Given your timeline of development, how does a business stack on top of that?’” — Renata Quintini, Lux Capital
On the value of independent thought:
“These days, we don’t have the freedom to have a poor choice of words. You get crucified. I really miss the time where you could just put something out there and people could say, “You know, that’s a really crappy thing to think, and you’re super wrong about this issue.” — Cyan Banister, Founders Fund
On investment trends to watch:
“I think we’re going to be in a much more streamlined, multi-modal world. I think we will be able to have apps and services that stitch together to get you from Point A to Point B in the fastest, most fuel-efficient, environmentally-friendly way possible. Every minute of every day, I should be able to open an app and know exactly which modes of transportation I’d be taking.” — Sarah Smith, Bain Capital Ventures
“Fintech is a big one. I think the category where the legacy companies have created a lot of fear, confusion, and distrust among their customer base is where technology can create a level of access greater than ever before. Another is around how can technology create access to healthcare and not just convenience? A doctor showing up at your door in San Francisco is convenient but access to products and services in consumer health that you may not have been able to get before at an accessible price point is a new level of access. Another bucket I am very focused on are new types of commerce platforms. We’re looking a lot at video and live-streaming and bringing new ways of creating customer engagement.” — Rebecca Kaden, Union Square Ventures
“There’s interesting opportunities in women’s health — whether it’s fertility or benefits that relate to women in the workplace. We’re seeing a lot in this area. The second area we’re interested in is around experiential commerce. You obviously had some really exciting brands built online, but at the end of the day what we’re seeing is that a lot of traditional retailers are trying to re-invent.” — Anu Duggal, Female Founders Fund
“There’s a renaissance around men. Men have been the forgotten customer, and that’s mostly because they didn’t ask for more and the industry didn’t deliver them more. Men, just like women, have great access to information they are smart consumers, and they’re taking more things in their own hands. So there’s an opportunity to deliver better to men across many categories.” — Kirsten Green, Forerunner Ventures
“I think the prescription marketplace is totally broken. A lot of these drug delivery platforms and convenience-focused startups really exemplify privileged, young entrepreneurs focusing on issues that they see. If you study the space, you’ll quickly see that convenience is not really a problem in healthcare. It’s really about cost.” — Kimmy Scotti, 8VC
On sexual misconduct:
“That power dynamic is changing because social media has allowed messages to get amplified. Now, obviously, there are pros and cons to that — there are unintended consequences and there are some bad actors who are out there promoting messages for reasons other than speaking truth. We are in some hazy days, and we are in a place where there are some difficult situations, but I do think in general, we are moving in the right direction.” — Heidi Roizen, DFJ
“It is the worst version of power play when people are seeking someone’s mentorship for things that are critical to their livelihood, and then they’re put in that position. Addressing it is speaking up. It’s women advocating not only for themselves, but also for each other.” — Cindy Eckert, The Pink Ceiling
On promoting diversity in tech:
“Some of these big firms often believe in the white guy in a hoodie disrupting a whole industry. So we’re going to disrupt it by making sure we’re indexing for women and minorities because they’ve got great ideas. I can’t totally predict when the stats will change, but I can put money where I think there are levers. And I think the LP community is one of the levers. When you see the LPs starting to move, that’s when I think you’ll start seeing pretty disruptive change, perhaps sometime in the next three to five years.” — Melinda Gates, Pivotal Ventures
“If you want to have great discussions within a partnership, it’s the diversity of backgrounds that makes that happen. Gender is obviously one aspect, but we should be looking for people of color and a variety of different ways that we can enhance diversity and perspective. It’s the things you see, but it’s also the things you don’t see, that make diversity so important.” — Ann Miura-Ko, Floodgate
"We’re taking a more intersectional lens to the diversity point. Ethnic representation is also incredibly important. You just need to have different points of view, right? And it varies from company to company in terms of how they want to quantify that. These points are being considered very early on by our portfolio founders because they recognize that diversity will be a big part of supporting their growth.” — Sutian Dong, Female Founders Fund
“The contribution and intellect of females is being undervalued and underestimated, and we know that the companies and the funds who have invested in more female-led companies have experienced better returns.” — Jillian Manus, Structure Capital
On the best advice they’ve ever received:
“When you stop learning, you perish. It’s a cliche thing to say, but I really think it’s an advantage. For me, I was in this crazy article in The New York Times about how I have a Gen Z mentor. It’s actually true, but it started just because I wanted to be helpful to a young woman who I knew was talented. At some point, I realized I was learning more from her than she was from me. It constantly reminds me not to be ageist or industry-ist.” — Kara Nortman, Upfront Ventures
“I go back to something that [former Time Warner CEO] Dick Parsons said to me when I was a much younger executive. We had been sitting at a table together negotiating something, and he came to me afterwards and said, ‘One thing to remember as you go through life is that it is always wise to leave something on the table—that a victory for one side or the other is a prescription for failure. So be careful. Just because you can get someone to agree to very tough terms doesn’t mean it’s going to be in your long-term interest to do that.’ — Susan Lyne, BBG Ventures
“Go home. Take the day off. Stop working. I’m a big proponent of self-care, and I’ll never stop talking about it. If self-care isn’t part of your daily and business routine, you’re doing it wrong. It’s about recognizing how valuable you are, and you can’t run a company if you’re not able to take care of yourself first.” — Arlan Hamilton, Backstage Capital
LATEST FROM FORTUNE
• Serena WIlliams Talks Women, Being a Mom
• Exclusive: McKinsey's Global Boss on Controversy—and Transparency
• Bumble Bee Foods Aims to Put All Its Fish on the Blockchain
• Betterworks, a Redwood City, Calif.-based, enterprise HR software maker, raised an additional $27 million in Series B funding. Emergence Capital and Kleiner Perkins led the round.
• Transposit, a San Francisco-based provider of an API composition platform, raised $12.2 million in a Series A funding. Sutter Hill Ventures led the round, and was joined by investors including SignalFire and Unusual Ventures.
• Knock, a Seattle-based provider of CRM solutions for property managers, raised $10 million in Series A funding. Madrona Venture Group led the round.
• SOM Biotech, a Barcelona-based drug developer, raised 7 million euros in funding. The lead investor was a European family.
• LinkSquares, a Boston-based provider of AI-powered contract analytics software, raised $4.8 million in funding. Hyperplane Venture Capital and MassMutual Ventures led the round.
• DesireList, an e-commerce platform hinged on reviews from professionals, raised $3 million in seed funding. Don Thompson, former CEO of McDonald’s; Sonny Vu, former president and CTO Connected Devices at Fossil Group and John Brenkus, creator of show “Sport Science” were the investors.
• Osano, an Austin-based data privacy startup, raised $3 million in seed funding. LiveOak Ventures led the round, and was joined by investors including Next Coast Ventures, Capital Factory, Social Starts, Barracuda Networks co-founder Michael Perone, Bazaarvoice founder Brett Hurt, and Indeed founder Rony Kahan.
• Jargon, a Seattle-based conversation platform for voice applications, raised $1.8 million in funding. Ubiquity Ventures and Crosslink Capital led the round.
• Bid Ops, a San Francisco-based cloud platform for procurement automation, raised $1.75 million in seed funding. Illuminate Ventures and Cervin Ventures led the round, and was joined by investors including Correlation VC.
• Owkin, a New York-based AI maker focused on medical research, raised an undisclosed amount from F-Prime Capital and Eight Roads Ventures. GV, Cathay Innovation, and NJF Capital also participated.
• Iguazio, an Israel-based data platform, raised an undisclosed amount from Samsung SDS. Iguazio is backed by Pitango Venture Capital, Verizon Ventures, Robert Bosch Venture Capital GmbH, CME Ventures, Magma Venture Partners, Jerusalem Venture Partners, and Dell Technologies Capital.
PRIVATE EQUITY DEALS
• One Equity Partners sold Resolute Industrial Holdings, an Indianapolis-based maker of chilling products, refrigerant storage, and air conditioning services.
• Mercer Global Advisors Inc, backed by Genstar Capital, acquired Confluence Financial Advisors, a Boulder, Colo.-based wealth management firm. Financial terms weren't disclosed.
• Mason Wells invested in RJW Logistics Group Inc, a Woodridge, Ill.-based provider of supply chain and trucking logistics services for consumer packaged goods companies. Financial terms weren't disclosed.
• Intergulf, backed by Kinderhook, acquired Beaver Oil, a Hodgkins, Ill.-based treatment and recycling company. Financial terms weren't disclosed.
• Sciens Building Solutions, backed by Huron Capital, acquired Empire Electric, a Miami-based provider of fire detection, suppression, and electrical systems. Financial terms weren't disclosed.
• Advarra, backed by Linden Capital Partners, acquired Quorum, a Seattle-based firm creating an institutional review board for clinical research clients accelerate research. Financial terms weren't disclosed.
• JMC acquired Mansfield Sales Partners, an Andover, Mass.-based provider of revenue and B2B sales consulting services to tech firms and private equity portfolio companies. Financial terms weren't disclosed.
• Airbnb acquired HotelTonight, a San Francisco-based hotel-booking service. HotelTonight was previously backed by Accel, Battery Ventures, GGV, First Round Capital, USVP, and more. Financial terms weren't disclosed.
• TIBCO Software Inc. acquired SnappyData, a Portland and Pune, India-based real time analytics platform. SnappyData had been funded in the past by GE Digital Energy, Pivotal, and GTD Capital. Financial terms weren't disclosed.
• HeadSpin acquired NimbleDroid, a New York-based tool for creating apps. Previous backers included Tsingyuan Ventures and Social Starts. Financial terms weren't disclosed.
• PointClickCare Technologies acquired QuickMAR, an Eagle, Id.-based software maker focused on senior living. Financial terms weren't disclosed.
• Dialog Semiconductor plc, will acquire Taiwan-based Silicon Motion Technology Corporation’s Mobile Communications product line, FCI. Financial terms weren't disclosed.
• Tradeweb Markets, a New York-based electronic trading platform, filed for $100 million IPO. Thomson Reuters and Blackstone back the firm. J.P. Morgan, Citi, Goldman Sachs and Morgan Stanley are underwriters. It plans to list on the Nasdaq as “TW.” Read more.
FIRMS + FUNDS
• Boyu, a Chinese private-equity firm, has reportedly raised $3.6 billion for its fourth and largest fund, Reuters says citing sources. Read more.
• Sheridan Capital Partners, a Chicago PE firm, plans to raise $300 million for its second fund, per a filing. Read more.
• Magic Stone Alternative Capital, a Beijing-based venture firm, raised nearly $200 million for its second fund, per a filing. Read more.
• Tsingyuan Ventures, a China and U.S.-focused Venture firm, raised $51.7 million for a fund. Read more.
• Contrary Capital, a venture firm, is targeting $35 million for its second fund, per a filing. Read more.
• Omidyar Network has spun out Flourish, a venture fund focused on impact fintech. The firm launches with an existing $200 million portfolio companies, and has up to $300 million for operations investments for the next five years.
• Playfair Capital, a UK-based firm focused on seed-stage companies, raised $32 million for its second fund.
•Ryan Merket, a Facebook alum-turned angel investor, will head Firebrand Ventures new Austin office.