00:00:01 [Music] moving the needle and found a failure one conversation at a time I'm your host Lukas poles and welcome to startup to point out by spark XYZ join us each week as we give you access to some of the top investors and entrepreneurs around the country to help me think through and overcome some of the top challenges it started I think there's no better place in the country to be investing than Los Angeles what is the problem that you're solving and for who like what is that specific pain point sometimes when a company is not

00:00:32 listening to his customers and just thinks it knows better than it customers has a really really hard time finding product market fit I want to see somebody that that isn't gonna stop you know this person you just feel like they're gonna they're gonna they're gonna make it work today on the show we welcome Patrick Driscoll from 500 startups Patrick is the investor education program energy there which means that he teaches investors how to invest Patrick welcome to the show thank you excited to be here thanks for the

00:01:09 opportunity yeah really appreciated coming on sure typically where we like to start is want to find out a little bit more about 500 kind of their investment thesis all of that kind of fun stuff and then wound up diving a little bit more into you and kind of how you ended up there and kind of your background so okay yeah that'd be great great well I guess just starting off with the thesis 500 essentially likes to invest early and invest often the belief being that a large and diverse group of early-stage investments will really

00:01:43 de-risk the process and also provide maximum potential for returns on investment for it for DLP's and for the investors that's kind of the process so that berline often is really important for them and kind of a numbers level 500 has made well over 2,300 investments well it's been around for 10 plus years yeah already impressive yeah I think we're at 16 unicorns and three ideas because our generations so let's let's dive a little bit more into you I know that you're involved with a bunch of different programs right now and then

00:02:29 specifically even with what you do with 500 which is teaching the investors how to invest which is a very interesting our standpoint where because most entrepreneurs don't even think that investors need to be taught how to invest let's walk through a little bit of that let's walk through kind of what it's what are some of the high level topics that you end up talking about with them sure so well I guess taking a step back in addition to the fund aspect of 500 there's also a huge ecosystem development portion of 500 at its core

00:03:06 level Eckles mission so globally we we've invested in over 70 countries and because we've seen so much growth in the startup in ecosystem world and different regions around the world and the globe we decided to kind of develop this ecosystem strategy so 500 part of that is where I come in where the investor education program manager mm-hmm but we also do corporate innovation with corporates to help them really figure out how to work with startups create CBC's and really innovate internally we we do partnerships with governments as

00:03:44 well so it's kind of a multi-tiered system to get to all parts of startups and start out at the startup ecosystem within these developing geographies and regions so for the investor education portion which is what I help manage it's super exciting and it is cool to see that 500 thought about the investor piece when they're developing an ecosystem and with the entrepreneurs and errors in the startups obviously they need their technical assistance and they need to be helped in developing whatever

00:04:17 they're trying to do whether it be marketing etc etcetera but so do investors and a lot of folks kind of questioned why we why five hundred would do that and the thought process in my opinion is that there's enough cake for everyone to have a piece you know and if we're developing strong and coherent investors in these new ecosystems and new parts of the world and new parts of the US etc then they can help develop startups that what dead and further down the process come into the back of your funnel and

00:04:50 just really building that family see and because we see such a sexy quote-unquote industry everyone wants to get into it and nobody really understands how to there's a lot of imposter syndrome there's a lot of folks that want to focus and different VC or different verticals and great feces that's either focused in diversity or a vertical they're passionate about whether it's med tech or maybe female founders and that's kind of where they're coming from but they don't know how to raise a fund or they don't know how to operate a fund

00:05:19 or they don't know I do deal with this process for vetting deals and that's was part of the impetus of creating the investor education programs awesome so what so what are then some of the mistakes that you will try to help investors avoid kind of early on sure probably a lot to give so I think part of the reason why the program has developed venture capital unlocked specifically program was to help new new fund managers or new angel investors and investors new family offices even existing ones avoid those mistakes as

00:06:00 time wasted his money spent you know so we really try to provide a framework through the VCU program and just to avoid those commonly may mistakes so maybe allowing a company that's on your thesis to pitch you and why would you do that if you don't know anything about it going after creating that thesis actually mm-hmm a lot of new fund managers have been able to raise funds maybe if they've gotten to that point but they don't know what to specialize in or they don't know what vertical to look after they don't know

00:06:32 the types of founders they're just going at it agnostic Lee which isn't often times the best way to do it mm-hmm having a systematic approach to a thesis is very useful and will eliminate a lot of opportunities for messing up and that's a huge part of several of our programs actually developing that thesis running it past our team some of our partners teams even within the cohort of investors that come through our programs so that's a huge piece of it and then we get into a lot of due diligence

00:07:05 questions that need to be answered just to de-risk your investment we provide frameworks for for cap tables and term sheets and how to really understand how those work because people try to self learn and it's not where they learn through doing which is oftentimes what you need to do in VC and entrepreneurship in general but we can help kind of skip a few steps to get them to where they need to be to at least understand how to successfully manage these tools you know in addition to a million other things that we

00:07:38 provide for do these programs awesome let's switch gears a little bit I know that you're on the you're on the board of start out here in LA yes we wanted to just find out more about what the program is what it entails what is the the purpose or the driver of it really okay my background is mostly in supporting entrepreneurs actually that's imposed the investor education piece which I fell into I guess I can talk a little bit more about that later but when I found out about startup and what I decided to move to Los Angeles in

00:08:16 November I was living in Mexico City before this I wanted to get involved in the lgbtq+ ecosystem specifically helping entrepreneurs and helping investors get connected just because it's a thing that's been a passion of mine even in Mexico City when I was living there I was working to help entrepreneurs that happened to be part of the lgbtq+ community so when I landed in a way I made a network of lgbtq+ investors former founders current founders startups and reached out to them to tell them that I was moving to LA they really

00:08:52 kind of helped push me to get involved and start out and then the opportunity arose to chair the board for start out in 2020 and I quickly decided that would a be fantastic in terms of my own personal goals for helping lgbtq+ entrepreneurs also be a great way to meet people as a new person to the city it's something that I passionate about the mission have started out a lot it's exactly with what I'm passionate about as well so it wasn't easy yes awesome no it's super exciting what type of programs are they specifically running

00:09:23 throughout throughout the year did they do events do they do pitch competitions like how does it actually end up working all of the above so I started out as very eclectic as the lgbtq+ community tends to be and there are events basically every month and there's it culminates in a large demo day most likely in the fall there last year there was a fantastic specialized demo day focused and social impact outside of those two demo days there are events there's one at the end of this month actually focusing in the

00:09:56 entertainment industry how to successfully start and run a business in that industry which makes sense here in Los Angeles we try to make things specific to the geographic region where it is started as a national organization this year were kind of driving the idea of diversifying membership and I'm excited that we have quite a diverse board this year and I think it's going to really allow folks that have maybe not have heard of start out or these types of affinity groups to get involved if there may be a person of

00:10:32 color or a person of color or a lot of women founders and women investors I'd love to get them more involved in start-up that's a huge driver this year so we're doing a lot of events surrounding diversity in the Entrepreneurship space and how to help support folks outside of whatever you might associate with and so that's super exciting we did we do mixers we're looking to get more in said doing things like hikes and stuff as well just to build the community and yeah the idea is to build the community and to support

00:11:07 the community and make sure the community is successful and empowered is one of the main drivers trying to connect is to kind of I know that funding is very much a can be a challenge right yeah so is that kind of one of the main drivers is trying to make sure that not necessarily that they understand cool obviously they get funded but giving them at least getting them exposure to the right people to actually do the fun yes absolutely I mean I think any good affinity group or any good even venture capital fund helps

00:11:43 their startups their founders whomever is involved with them get access to capital because that's obviously a huge reason why a lot of companies fail and that's the same with startup there's a lot of effort to put these entrepreneurs and founders whether it's early-stage ideation or whatever not only with mentors we're going to help them with their technical skill building but also that access to capital which is huge and as a growing number and the US there's an increased visibility of folks with

00:12:16 visa specie funds or angels or family offices interested in investing into lgbtq+ entrepreneurs and making sure those bridges are built and sustained and grown as is very important and even through its network which continues to grow every year start out is going to be able to make those connections outside of the lgbtq+ community so finding capital from existing VCS from different sources in the US and it's been it's been great to see and you know putting the right people in touch is obviously a

00:12:52 win-win situation and that's something that leaving we trying to do awesome no it's really exciting and encouraging I know that besides the prototypical white male what do you for a lot of other people that it can be very can be tough to make that hurdle jump there there excess barriers that don't need to be there yeah that kind of are and so I definitely appreciate some of the work that you're doing and trying to make that significantly easier for them let's tack a little bit more deeply into into you I know that you're

00:13:35 new to LA I know that you're enjoying the weather pretty much the city wasn't terrible good good so I was the perfect perfect transition so where you worked on a lot of these programs internationally walk me through some of your journey and then how you even ended up at 500 itself so I I guess when I was young and bright eyed and bushy tail recent college grad I wanted to go out and save the world that was my mission and drive and I wanted to go international get involved in international development I would want

00:14:13 it to build windmills and Zimbabwe and all those things that normal people want to do and luckily I my first job after college was in international development which really opened up my eyes to a lot of the big not necessarily issues with the process of international development but the hurdles and negative impact it can have throughout the world and that kind of is the first indicator that maybe I can shift in a different direction I ended up in grad school at the University of Denver focused in

00:14:47 microfinance and international finance Wichita was my first foray into helping entrepreneurs and smacker finance is essentially oftentimes a small very small scale loan to an entrepreneur in the developing world or even in the United States and in some regards that brought me to Senegal in West Africa where I was working directly with entrepreneurs for the first time and I was doing basic things like financial literacy personal management online marketing basic marketing for ecotourism actors and in Senegal which was super

00:15:21 interesting for about two two years with a piece for the US Peace Corps oh you were the Peace Corps I was sorry it sounded everything you were talking about yeah so that technical assistance to entrepreneurs was something I wanted to continue and I ended up spending time in the South America and Colombia where I worked with quite a few founders in addition to Real Madrid where I was working with youth leadership camps they have a foundation there which was fantastic to work with right after the

00:15:51 Peace Corps and from there I ended up in Mexico where I worked with a few entrepreneurs as well for the first time and then I finally got to Los Angeles for about a year right after all of those international experiences and had the opportunity to work with a federal agency that I'm not sure that I can mention context clues it's pretty easy that worked directly with two small businesses right and I was training lenders throughout the LA area have better lending practices the product that the government provided and how to

00:16:27 kind of implement them in a way that would be beneficial to the entrepreneur as much as humanly possible then that introduced me to several public speaking events where I was able to meet a lot of accelerator programs technical assistance which I was passionate about anyway based on my prior experience I met great organizations lively see the Los Angeles something tech incubator and folks like that which were super inspiring to me and through those accelerators and technical assistance programs I met a lot of PC's and that

00:17:00 was the first time that I really met the venture capital world and happen in Los Angeles and I knew at the time I wanted to transition back international like you know if I could do short periods of time in the US I'm in a way for pretty good at the moment and decided that I wanted to pursue a career directly in venture capital found the position with 500 and investor education which I was already doing a lending lender education essentially and applied and was on a plane moving to Mexico shortly

00:17:30 thereafter and was very steeply steep learning curve learning venture capital since I was about to help okay a bunch of investors know it's great if the people that are running the programs know how to do it if they're teaching you how to do it might help [Laughter] awesome so okay so you've got a lot of international experience so let's dive into specifically Mexico what are some of the challenges that someone from international like an international entrepreneur would face versus someone in the US for getting investment from

00:18:07 you yeah getting investment maybe support ecosystems I feel like you might compare it maybe to like the valley is the valley right but maybe someone in the Midwest where the the ecosystem might not be as strong yeah like what are some of the challenges is someone maybe in Mexico City that would face first day sure you might not run into in the US definitely there are several challenges and I think in the past Mexico City for example in Mexico in general have had a really good development curve in the past few years

00:18:43 musically maybe the past five or six where a lot of funds have emerged a lot of international activity has focused in Mexico City there are a ton of entrepreneurs and Mexico City the founders and great startups and Latin America in general is seeing an explosion within the startup community which is naturally bringing investors that want to get to be a part of the process and that's been great to see but it still isn't nearly as robust as San Francisco similar situations in the US and there are language barriers

00:19:16 obviously a lot of founders are able to speak English in our NMR accelerator program in Mexico City five hundreds accelerator program in Mexico City there's a requirement for English just because when you're approaching investors outside of the Mexican ecosystem or the Latin American ecosystem oftentimes they're gonna be from the United States that's a huge hurdle the access to capital is a huge hurdle levels of investment are lower which makes sense based on economic indicators and just the economy in

00:19:49 general but there's no and like the one thing that I'll also mention which is huge and I don't know I didn't talk about this at first is there's a huge brain drain or we're really talented founders and startups don't want to stay in Mexico or country X they want to initial they want to immediately go to Silicon Valley or the area where the investors are where they can get good team or they could join a team so really great maybe coders or something well no won't stay will try to go get a job somewhere

00:20:18 else so there is that kind of brain drain which is slowing down which is really great to see and people are beginning to understand the potential of of the region in Mexico as a country in general I feel like a lot of the brain drain kind of because even LA was running into that challenge I mean la graduates more engineers than anyone else in the country which is a wired fact right but keeping them was the most difficult thing because everyone would just go up to the valley I feel like as the ecosystems try or start to mature

00:20:53 that you end up getting people who are who end up staying and building there are a lot of the time do you find that if the companies from they go from Mexico to say the valley to find people do you see them going back to try to pay forward what does that transition kind of see because I feel like once you have an exit if you can bring back to capital to kind of restart programs that that helps tremendously sure and I definitely have seen that I'm not sure about any numbers to back it up but be good and

00:21:31 folks are going back to Mexico Mexico City and other parts of Mexico with large startup ecosystems at a higher level only because the ecosystem themselves have grown to a point where it's it's substan enough for success mm-hmm and it is it is really great to see and a lot of those folks if they are successful will bring either programs or coding opportunities for you know kids in high school or something like that just know really helped grow it at a base level and to spread the idea of entrepreneurship in the tech industry

00:22:05 specifically mm-hmm and it is happening and there are some great programs happening in Mexico specifically so it's occurring I always hope that it occurs more and I think there's amazing opportunities and Mexico personally and would love to see those help help I love to see those grown to their full potential a big heartfelt thank you to Breck's who without their support this show would not be possible we've seen firsthand the difficulties accessing basic corporate credit without providing a security deposit or personal guarantee

00:22:37 early on as companies grow managing expenses has become more difficult and time-consuming which is why we've partnered with Breck's to offer a corporate credit card that is not personally guaranteed offers higher credit limits provides Auto reconciliation and integrates with ERPs using receipt capture Breck's is the credit card of a start ecosystem and we highly encourage you to check them out one of my favorite topics typically on the shows around due diligence just because a lot of everyone kind of has a

00:23:08 different take on it and they're everyone I guess all the different investors have different specific things that they end up looking for like me for example like I very much love go to market strategy because probably because I have a sales background so it's very impactful on me so walking an investor through kind of the the process of due diligence like what are you trying to educate them on to look for I think it's interesting to find the different dynamics from from an entrepreneur standpoint to see kind of what investors

00:23:42 look for for trying to get that investment so what are you trying to teach that I think the first thing that the 500 VCU program is venture capital unlocked programs are trying to impart is the idea of self reflection know what your specialties are know what you're knowledgeable about and that's going to directly influence your thesis and if if you have that level of self-awareness then the rest will kind of fall into well it won't fall into place because you have to still work but it'll be a lot easier to allow the pieces to fall

00:24:13 into place and there are often times investors and my experience that aren't interested in maybe the gaming industry but they've never worked in the gaming industry they might have grown up playing video games but they don't really know anything about the business model so do you really want and that person might be coming from a med medical background yeah so why would you want to focus in the gaming industry because you're casually interested in it when you can focus in the med tech industry well or you'll actually be

00:24:43 knowledgeable and and have a higher chance of knowing what a good idea is and what a good entrepreneur looks like so that's one huge thing that we help them get through for the due diligence process because each investor is different we try to provide 500 and the VCU programs try to provide an overview of how to do due diligence and me and the program actually will provide a template for questions you should ask and which need to look for the data points that you really should strive for the founder to have ready mm-hm and once

00:25:17 you've isolated and identified two key things that you as the investor are looking for then you can proceed with further due diligence processes so the program is designed to provide baseline tools that can then be developed and built upon within each participant in the program so they can take the template go forth build on that for whatever they're actually looking for and then they can successfully you do a due diligence process and then of course we get into that the idea behind you diligence why

00:25:45 it needs to be done and just the the most important backbone questions that need to be asked it's good I think one of the good that you're educating people because I feel like a lot of especially just the angel investors like you always know yours remember the first check that you wrote that you shouldn't have written and it's generally a can be a large mistake yeah so definitely a valuable valuable piece what are some of the let's dive a little bit deeper into kind of some of the red flags that maybe

00:26:22 the investor should be able to spot early on like what are some of the red flags that you're conveying to them to to look out for when trying to evaluate a deal sure number one and I think a lot of folks in the VC industry will agree this team and if there is specifically with 500 at such an early stage investment if someone isn't working on their company full-time for example and they're starting on full-time that's an immediate red flag yeah and take that into consideration if you're an investor

00:26:58 in the early stage if you're an investor that is doing even earlier earlier stage maybe that's something that wouldn't shake you know additionally team mates how they work together you're always striving to identify strengths and weaknesses and hopefully they can self identify and how they complement one another in terms of how one person will be the face the other person will be the back end operator there's a technical specialists understand the team dynamics really well get to know them if you are at a point

00:27:27 where you want to ask follow-up questions in the due diligence process get to know the team mm-hmm and that's a huge huge part of the process is a lot of investors think emotionally and that's a huge part of VCS emotion versus rational thought because there's not there's not so many things you can do risk and only so many ways no no so motion goes into it but keeping those in check and additional red flags include if it's your industry in your specialty understand the market and understand the market analysis if the founder hasn't

00:28:02 done any sort of competitor analysis or even a SWOT analysis mm-hmm and that indicates that they might not be knowledgeable enough to really go forth and be successful mm-hmm and honestly in the pitch have a list of criteria that you're looking for and if something if something is missing if there's an overt piece or a lack of information about financials or forecasting or something like that you can that's a huge red flag a you know B you can work with them further to tell them you know come back to me in a week

00:28:35 with all of this prepared and make it realistic or sometimes it's completely unrealistic yeah you as a specialist lovely and that feels no no so so yeah there are I mean there are million red flags that can happen you try to provide a substantial list of incident venture capital programs but there's only so much preparation before they have to go on on their own yeah I feel like there's a lot of it is ends up coming down to pattern recognition I was just doing it yeah like 3,000 decks last year and I

00:29:10 feel like once you've kind of gotten to that place where you've just seen a lot you can look at something do like oh I already know that there's a challenge here like I don't even need to talk to you I can sing it within the actual deck so and new investors often have dis imposter syndrome which I believe I mentioned earlier you know and that's something that the program tries to drive is everyone is in the same boat especially when they're new fund manager or new GP or a new associate in a fund

00:29:38 you're you're not gonna know everything you're gonna have to learn just like everyone has given the gift to venture capital college you have to really strive and figure it out and once you get to a point where you see 3000 decks in a year then hopefully you can build up that skill set to be able to bet them very quickly and the imposter syndrome is fun very interesting because I mean even a lot of the investors that I talk to it like VC is not a great asset class just but I don't know we ended up I

00:30:11 remember I was at a meditation retreat in the valley with a bunch of other VC is like we had all burn a peer group and some big names in there actually and we were all sitting together and we all kind of came to a conclusion that I know honestly none of us truly understand what we're actually doing because we can tell you the difference between a good deal and a bad deal but we can't tell you if a good deal is actually going to succeed yeah or not and so it was fascinating to find out but they're like

00:30:39 named brain DC's that still felt that same imposter syndrome that really everyone else feels because it's like I can't tell you if they're going to 100% succeed I'm making it bet and I mean that's the way to bestow VC fund structures is you're making multiple bets and then you're gonna ride them one bad day and exactly going well and it's it's always interesting to me because there are VCS with higher rates of success and obviously those are they're the brand recognition is huge for those yeah those we seasoned I would consider

00:31:13 500 is one of a very recognizable branding what I would do and the reason why I think rates are so high and with firms like that and funds like 500s and the injuries and Horowitz's and all of those is because the good deals or former founders that have we have exits and they know what they're doing and they know who their team is and they've dearest in a way that makes it even slightly more likely to succeed go to those firms for your investment and if you're a struggling or new or you're raising your first fund and are

00:31:47 looking for LPS you don't have that brand yet and that's a huge part of being into invest and that's something that the adventure capital not programs really talks about and coming out with maybe content pieces via LinkedIn or wired or or any number of places where you could help build your brand so that startup Cynthia flow Bowl you know getting fun of you at least ya know a good point I think the deal float is one of the big it's one of the big drivers on who he's gonna succeed who's not having access to the good deals yeah so

00:32:23 let's so let's switch gears a little bit and let's dive into some of the Entrepreneurship so so what are and we can talk about even some of the companies within five hundred or even before like what are some of the challenges very early on that they they run into and that they actually end up facing very early on challenges I mean the harken back to the team concept a lot of founders who kind of came up with this idea for whatever product or service did it with their best friend from college and they might not be the

00:32:59 best fit and that could end up corrupting the entire start with Dioner of itself that's huge obviously access to capital and if you are a first time founder and you didn't come from Stanford and he didn't come from Columbia didn't come from all these top-tier universities with entrepreneurship or MBA programs it's gonna be a struggle for you so identifying may be a potential teammate that's gonna help fill that gap you know just to be strategic and one thing that I do recommend specifically for early-stage founders

00:33:36 and maybe even for folks that are ideation phase are to read venture capital books so you understand from the investor standpoint what they're looking for and that's such an easy risk mitigation strategy for you where whatever you'll actually be able to prepare things that you can present in your deck for example to a potential investor and lack of preparedness is something that is everywhere you know in the startup world and it's very apparent and it's a huge red flag mm-hmm and if you're not prepared you're going to lose

00:34:08 that investor you can have to cool his product ever but if you're unable to convey the message or what it actually means then you're not gonna ever gain traction so understanding it from or being able to look at it from the investor's perspective at your product or service or whatever it might be I think is a really savvy way of conducting your deck or whatever your pitch might being is interesting the lack of preparedness I remember John from the Bucs company to flowered everyone he used to say that you have to if you're not

00:34:43 pitching your startup to the person standing in line with you at the grocery store they're not doing it right yes if you're the first person that is walking in and you're you're the first person they're gonna end up talking to as an investor like you haven't made a drastic mistake yeah under said yeah getting that story out I feel very first practice in front of the mirror yeah yeah be your own critic you know record yourself listen to it you know figure out what you invest in yourself no that's a huge thing that I know that I

00:35:16 always thought founders to do mm-hmm just make sure that it's good you have all the pieces covered okay so what so if they avoid all the red flags maybe they get their first precede there see ground kind of filled but what are some of the reasons that you end up seeing startups and ultimately going down the I mean market fit is huge and it could be just a market that's been exhausted or maybe you've it's such a niche product or service and you weren't able to pivoting is also huge maybe you haven't

00:35:53 been able to pivot and you haven't been able to make difficult decisions I know sometimes founders have to cut 60% of their team after they're even series-a sometimes yes they didn't pivot in time where they're in the midst of a pivot let's see on their way to save their their company or their startup and being unable to do that is gonna lead to the downfall of your company yeah and making those hard decisions and that's a huge aspect I think that's super interesting those is the pivot like not

00:36:24 waiting too long to to make the pivot and to make those tough choices you're like look I need to cut 60% of my team like this is the team that was executing on this piece it's not gonna work we need to shift gears like and just kind of being ruthless in that standpoint it's like you you were you were part of it for this journey but like for us to continue and for us to survive like we have to we have to totally shift gears got that shift like I think that's a I think it's a thing that a lot of founders might not have the heart to do

00:36:59 I agree all right yeah and it's kind of I mean the passion of the founder is always going to be there because that's how founders how good founders are created they're passionate about their startup and once they've gotten to a certain point it's not necessarily burnout but you might get comfortable mm-hmm and that's another big reason why I think some companies fail is the lack of fire that's driving them and part of that fire is being able to make those difficult decisions we got to cut half the workforce in order to move forward

00:37:28 just being you know pragmatic with all of your decisions and making sure you surround yourself also with mentors and teammates that are able to have your back and help bounce ideas off of and if we do do this pivot what do we need to work on how do we need to create a public relations campaign or something to just make sure we say face yeah and that's also I've read people oftentimes want to do things in isolation especially at that stage and you need to surround yourself with people that are gonna help you not drag

00:38:01 you down their church or advisor advisory role because you have to be very important just just even has that sounding board to have a conversation with them to get the objective kind of a viewpoint so we talked a lot about team being one of the most important things because I mean ideas are a dime a dozen and they're useless I've seen nine of the same ideas in the last two months Dec sent to me so we placed a lot of importance on on teams what are maybe some of the great aspects of the team I know we talked a little bit about

00:38:41 filling the gaps from the standpoint it may be University pedigree or something else but what are what makes a great team in them what can drive a team into into chaos and failure sure I think diversity and thought is a really strong aspect of a good team mm-hmm that being said there needs to be an underlying mission that ties everyone together so being able to wrangle the tech operator and the CEO and the public relations person and all these folks that are going to help lead and push the team to success but making sure that

00:39:22 they're all mission driven is is very important and on the same page and filling the gaps and doing that internal self-evaluation about what I'm good at and talking to somebody about it to is sometimes maybe you're not the best person to go to have that conversation with yourself yeah getting there and then working with the team to fill those gaps that you might be missing if you're the founder for example and making sure that everything is in place and ready to go having hard conversations and being

00:39:54 able to have a forum about it that's open and free is also great being an overbearing founder where you're not gonna take anyone's opinion seriously is not the best and yeah so in order for a team to be successful and to drive a successful startup there needs to just be open communication you need to be controlled obviously to a degree and it's just it's a team it's not there's no I in team what's never waited for a reason you know and just filling in the gaps and if you realize that there's another missing gap

00:40:31 invite somebody else or find an advisor or something like that that's gonna help you get there and self-learning is huge everyone should be especially at an early stage continuing to educate themselves in different aspects of the business different aspects of the industry and just be willing and able to learn from one another as well take criticism as constructive criticism be constructive in your criticisms so then what's your kind of take on because team is so important what about the solo the sole

00:41:07 entrepreneur like what can they be successful if so what would what is going to make them successful is that something that 500 considers like is like how is that viewed within the organization I think 500 I mean if we were 500 receive so many applications sports seed program it's it's inevitable that there was going to be singular founder singular teams meaning one person on the team and the entire portfolio history of 500 I'm not sure actually about the any sort of percentage but for my for my opinion

00:41:49 being a singular founder you need to be an incredibly special type of person to to get to a point even if you're at the seed level if you get to the seed level or even I mean Series A is a singularly founded companies crazy yeah I mean it's been done but that would be I'm sure I'm gonna think of an example and but to a point what a firm like 500 or a lot of other VC firms I would hope would be you need to bring other people on think as you can't do this all yourself because if you think about it the percentage of

00:42:30 failures so high with just one person that would it would almost be counterintuitive unless that person is somebody who's founded 17 companies and 14 of them have exited ORS machine yeah okay awesome so as the portfolio companies in 500 maybe they go through the program or even earlier founders like would what questions should they be asking when looking for VC funding like what what would make it a good relationship because a lot of the time this is very much like a marriage right I mean it well a short-term marriage not a great I

00:43:21 mean you're you're entering into a relationship for the next call it 3 to 7 years kind of minimum you very much need to like each other especially in it for the long haul so what are some of the other things that like entrepreneurship II asking themselves when looking at a VC firm or a 500 like why like what are why should i join that yeah so for 500 it's because I thought it's awesome well obviously why are you here on the show but no four founders if they're asking themselves what what it kind of falls in

00:43:59 with the team discussion what gaps need to be filled obviously there's the capital piece and they need an investment but if this is a venture capital fund that provides mentorship as well and they need that then go after that type of fund or going on to that type of capital if you're incredibly verticalized and you're in the med tech space don't go after anybody else except for those folks in the med tech place or maybe an agnostic firm such as 500 you need to find someone who is going to be a partner in this journey that you're

00:44:30 gone go on and you need to do research and maybe create some sort of chart I'm sure you could find me online as well with different funds what verticals they focus in what type of interaction may have with founders talk to other founders as well because they're gonna be your best friends and all of this and what experiences they've had with fund X and fund wise on G and if they were founder friendly did they try to get over on them in terms of the cap table and negotiations mmm taking too much equity or something

00:45:07 or - good luck with so many things so so yeah definitely do your research to talk to other founders get involved in networking events and places like that we can just get insider information from go to goo an event that someone like 500 would put on I'm just trying to do your research and be prepared it's it goes back to being prepared for your pitch and prepared for your investor meeting being prepared to interrogate yourself in the mirror about your your idea or whatever you just need to be prepared

00:45:41 when we're trying to find that VC but do your research awesome any final thoughts any final advice that you would want to impart on to entrepreneurs or investors that are potential investors that are looking to get into VC for investors understand that the failure rate it it is I mentioned this earlier such a sexy industry and everybody wants to do it not everybody can do it a lot of people should try to do it but know that the success rates are incredibly small and if you want to push through raise your first funds if you

00:46:19 even get to that point because planning LPS if you're an unproven investor or GPS almost impossible yeah know that it's gonna be an uphill battle and you're not gonna have a salary for a long time and you're not going to be able to afford things it's kind of similar to the entrepreneurship journey mm-hmm especially we don't have a name to back you and that's something you need to be aware of and if you're willing to take the plunge then go for it enjoy your capital unlocked with I don't think that a lot of entrepreneurs truly

00:46:52 understand the like because a VC I mean you're very much in a sales role you're either sound entrepreneurs to try to get the field floor or you're selling potential LPS like you are very much the middleman even though everyone wants to be a VC like the NBC is a is a grande yeah like it very much is I don't think a lot of people understand you know there you're gonna be approached on the street by full of ideas everybody event anyway even if they're not in a GP role or in an investment role but you work

00:47:21 for a fund you could be at the head of HR people I've assist my sisters roommates and that's friend has this great idea I need to talk to her it was not for the entrepreneurs does not the right time to approach people yeah fun time just asked for find a connection make a get a recommendation yes a hundred percent it drives me nuts when I even want to through West Coast challenge I was cheered like I was a dead man walking because it was me and associate there to put this on like a thousand person event and like I'm not

00:47:58 even there and people are talking about pitching me I'm like like I can't even hear you right now but I am so destroyed like I don't know what you're saying I'm just kind of I'm just kind of here so what's this happen at friends weddings for me any find all the pieces for the for the entrepreneurs out there go for it yeah go for it you might fail you might succeed but if it's your passion and do your research and go for it awesome how do how do people reach you how do people connect 500 sure the 502 website is 500 CEO for

00:48:40 the investor education piece it's 500 that education I'm sorry 500 CEO backslash education you can take a look at all of our upcoming education X program we also do programs for accelerator managers so if you're thinking about starting an accelerator definitely go to that website to check it out and a fresh and their seed program everything will be on 500 CEO and first start out if you're interested in joining becoming a member learning about events check how to start out org awesome I should really appreciate you coming on

00:49:12 the show great fantastic thanks again Thanks