TRANSCRIPT
slava (00:01.759)
Hello and welcome to another episode of Smart Humans. I'm super excited about today's episode. We have an incredible angel investor, somebody who's been in the New York ecosystem for years and helping to build that out. Jenny Fielding, managing partner and founder of the fund. Welcome Jenny.
jenny (00:18.754)
Hi, how are you? Thanks for having me.
slava (00:22.515)
So, you know, we always ask the same question to all of our guests to start off the show, which is, how did you even get into investing into alts?
jenny (00:32.174)
How much time do we have? Yeah, I mean, I think I've just been a curious investor, which is the way that I got into venture in general. So I was a founder myself. I learned a lot of hard lessons and thought that I could share my lessons learned with other founders. And so I became a mentor and kind of just an advisor to a few companies and ultimately ended up
slava (00:35.329)
Well, just tell us the story.
jenny (01:00.13)
joining a little place called Techstars and helping them kind of build out some of their accelerator programs. And through that, was able to meet entrepreneurs that were building all different kinds of companies, including around alternative investments. So I'd say that's how I got started. But I'm always kind of looking for new modalities and new mechanisms for both accessing capital and deploying capital.
slava (01:26.707)
And Techstars was quite early back then when you got involved with it. Tell us that story of how you got involved because now it's such an obvious name and the New York ecosystem is such a great one. You helped build that up. How did that happen?
jenny (01:40.126)
Yeah, I mean, again, I was a founder. And as a founder, you know this. You have a lot of things that you can share with other founders. And so I just started as a mentor. I was literally just dedicating my time or giving my time to other founders with no expectation of anything in return, just to kind of share learnings and insights that I had. And through that, Matt became familiar with the founders of Techstars.
and they ultimately kind of wooed me to become one of their managing directors. So I joined them full-time going from mentor to managing director in 2014. And I was really lucky to, you know, the first program I ran was around hard tech. Funny story, I didn't really know much about hard tech. I had built two companies in the mobile space, and I was, you know, pretty nervous and a little bit like insecure about it because I didn't have a technical background. I certainly didn't have a hard tech background.
And the founders of Techstars were just like, you know what Jenny, it's not about that. It's about helping founders kind of unlock, themselves unlock, see things that they couldn't see. And you've built companies, you can do that. And so I started a hard tech program and was able to invest in some really cool companies, including a company called Latch, which went public last summer.
slava (02:59.063)
Congratulations, amazing. And then didn't, going off schedule here, didn't one of your companies, Chainalysis, isn't that a company you invested in?
jenny (03:00.532)
Hmm.
jenny (03:08.87)
Yeah, so they had some big news today. So it was just announced that they raised around at about an 8 billion valuation, which is pretty stunning. So when they came into my program, they were three guys from Europe, and they'd kind of just got going with this really unique insight that cryptocurrency was going to be massive and that you're going to need data and analytics and kind of supporting infrastructure around that.
slava (03:12.235)
Yeah.
jenny (03:37.63)
What's interesting about that company is that people thought the founders were amazing, the idea was great, they actually had some really early traction, but a lot of people pushed back. A lot of the best investors in New York passed on that round because they didn't see that the market opportunity was huge. And so that was 2014.
slava (03:53.779)
And to be clear, oh yeah, perfect, 2014. And what was the like price that we were talking about in terms of quote unquote that round?
jenny (04:04.042)
I mean, they raised a small, their first round was, just a few million dollars and it was, it was actually hard to get going. And so they ended up raising their seed round, who led their seed round was an investor in Europe, which is a big disappointment to me because I thought this was like, the coolest company ever and was really excited for them to jump into New York and for all the investors to get on it.
But it was slow in those early days. They were really, you know, what we look for in founders is founders that have this vision of the future, right? It hasn't materialized and it's their job to kind of tell the story of where the world is going. And the Chainalysis founders were just incredible at that. But the world, you know, wasn't quite ready for them yet.
slava (04:52.103)
And just to give some listeners perspective, because not everybody knows the venture game, we're talking like a 5 million post or 10 million or 20 million or 50 million, somewhere in that early stage pricing, right?
jenny (05:04.978)
Yeah, very, yes, very, very early.
slava (05:08.555)
So yeah, I mean, so it's just crazy to have like, it's now an 8 billion, you know, many, many more zeros. So it's incredible to see that grow. So obviously you have an eye for spotting companies early. So we'll talk about that a little bit more in a few minutes, but you know, you're obviously so good at venture. How about the other spaces in all? Do you participate personally in, for example, like crypto?
jenny (05:31.722)
Yeah, so actually through the Chainalysis founders, I was encouraged to buy Bitcoin in 2015. I think as part of our accelerator class, you know, we were kind of, all of our eyes were open. And I think we all bought, you know, a little bit in that time and kind of got excited and got exposure to, you know, Bitcoin and Ethereum in the early days and really, you know, learned with everyone else starting at that time in 2015. So.
I'm definitely excited about it, but I guess I have, because I've been doing this for a long time, I have a little bit more of a perspective that this is gonna take a long time. And so instead of getting super excited in these moments of euphoria around crypto, I've been more of a dollar cost average investor, right? Where I put a little bit in, a little bit in, because I see the future, but I don't wanna get really caught up in individual trends. So I try to learn and keep up.
Um, and, you know, listen to podcasts like this, but, um, you know, not necessarily go with the latest and greatest trend.
slava (06:34.559)
And then how about your point of view or your involvement with like traditional art or collectibles, sports cards or NFTs?
jenny (06:44.37)
Yeah, I mean, NFT is like pretty interesting. So most people don't know this, but I went to Columbia University and I thought I wanted to study fine art. And so actually your co-founder, Eric, probably does know this. And so I was very involved in high school in painting and sculpture and all of these things. So I've always had this inclination for the arts.
And previous to Techstars, I was at the BBC running their innovation and venture group. And so although that's not art, that is about content, right? And that is oftentimes about video. And so got a little hint or taste of it in those days of figuring out what's the monetization beyond the moment, right? Like, how do you capture that in an ongoing...
in an ongoing methodology. And so I've kind of been following and investing in those spaces. And so when things like CryptoKitties came out, this was really interesting to me, not because of the physical manifestation of it, but just the ability to be able to kind of track proprietary IP on a blockchain was pretty cool to me. So.
I'd say, you know, a spectator, but pretty interesting, just from my own interest in kind of art and collectibles.
slava (08:06.443)
Got it, and then how about like your traditional Warhol or Moneys or you know, your Michael Jordan rookie cards? Are you buying any of that stuff or just kind of seeing others?
jenny (08:14.87)
Yes, my collection of Monet is in my house. Sadly, not yet, but look to people like you to guide me to some of the more specifics. But yeah, I mean, exciting. I mean, that is the point, is that someone like myself cannot go buy a Monet, but if I can have a representation of that, if I can have a slice of it.
through some type of collective, that's pretty exciting. And so opening that up to kind of the average buyer or the average investor is what's super exciting about platforms like Vincent.
slava (08:49.463)
Great. And then how about the more yield oriented assets like a debt allocation or real estate? Are you into those or do you like to invest into those?
jenny (09:02.358)
I try to diversify like most people. So I'd say real estate, yes. Debt probably out of my skill set. But again, fractionalization, super interesting for me. I don't need to be owning properties around the world, but to have access to growing markets. I'm in Lisbon, Portugal right now. And if you could see what is going on here in the housing market, I mean, it's insane.
People that bought places a few months ago have already doubled their money. And to have exposure through some type of fractionalization is what I'm interested in and where I'm putting my cash.
slava (09:41.847)
Okay, great. Speaking about where you're putting your cash, what do you think of today's market? And it doesn't have to be really like of the moment, the millisecond, but rather where we are right now in Q2 2022, obviously I don't wanna lead the witness, but there's a lot of challenges with the market. There's also some potential positives. What do you think of the current market and really how it implicates, you know, second what you do day to day. But let's first start with your point of view on the broader market.
jenny (10:13.086)
Yeah, well, venture where I spend most of my time is a great way to get rich slow. Right. So when I invest in a company at the earliest stage of its journey, it's usually a 10 year journey before there's, you know, if there's going to be a great outcome, which is already, you know, potentially won't be, but if there is, it can be at least 10 years. So I have a long-term time horizon. And so I think if you're investing, especially in tech, the area I know most.
You have to kind of take a zoom out. The same thing that we were talking about with chain analysis, right? Do you have a vision of the world going directionally in one way? And so when I invest in cryptocurrencies, I don't worry about today or tomorrow. I think, is this where we're going as a society? And so what's happening in the market right now, although it's not good and somewhat terrifying for all of us to see our portfolios take a hit, I think as a long-term, 10-year horizon investor.
I don't have to think on the day to day. Now what happened in the last few years in venture was pretty extreme. If you just think about the valuations that founders were commanding for their companies with hardly any metrics, hardly any revenue, because everyone was excited about tech.
And so some of that is now cooled off and we're gonna go back to some fundamentals. And quite frankly, although it's painful, you know, for me, I think it's actually a correction that is good for everyone. So the last few years have been unsustainable in venture. And now I think we're seeing some of what I call the tourist VCs, meaning the folks that maybe were hedge funds or private equity that saw a lot of yield in...
in the early stage are now starting to kind of retreat and realize that maybe it's not the best place to play right now. So yeah, it's been wild to kind of watch it and yeah, see where things are going.
slava (12:15.735)
So with your venture fund, the fund, as you mentioned, you get to kind of ride this up and down because you wanna have that return hopefully in five, seven, 10 years. But with your own personal net worth or your own personal money, do you see the market today as an opportunity to get things on sale or are you avoiding it to wait till it stabilizes? Do you have any perspective on that? And obviously you...
probably have a lot of your money tied up with your fund and all that stuff, but what do you think outside of the fund with your own investments?
jenny (13:07.206)
Yeah, I
jenny (13:21.354)
I think those are interesting opportunities. So I think, again, if you have the option to kind of buy and hold long-term, it seems like this would be a good time, and it is what I'm doing cautiously, right? So again, I believe in diversification. I'm over-allocated in early-stage venture, and so try to look at some public opportunities as well as some alternatives.
slava (13:46.059)
So as part of you mentioning DCA and dollar cost averaging into crypto, let's use Bitcoin as an example. You know, Bitcoin today is, it touched 29,000. And do you see it as a good DCA opportunity or are you concerned that it drops from here?
jenny (14:06.322)
Yeah, you know, again, like I think the long term, these are good, these are good long term bets. And so I think at 29,000, like I'm a buy, but it doesn't mean that there won't be another drop. You know, directionally, I'm excited about cryptocurrencies and have invested in, you know, a wide bucket, but don't put any one stake in or too much stake in anyone.
slava (14:30.707)
All right, great. So let's transition to more of your sweet spot, which is angel investing and all those early stage founders. It's arguable that you're one of the pioneers to help drive forward the New York ecosystem. Can you just give perspective on why that happened? Is it you consciously chose not to go to Silicon Valley? Was it an accident? Did you think New York was next and you wanted to be early? Like...
outside of your actual career and Techstars, all that, how did that happen?
jenny (15:03.678)
Yeah, so I started my first company in 2007, and everyone said, well, first of all, you're like a woman running a tech company. That's weird. But the second thing they said is, if you're going to do that, you should go out to Silicon Valley, because that's where big tech companies are born. And I looked around, and I said, well, that's super interesting. New York has tons of cash. Might not have had a lot of VCs in the days, but it had a lot of Wall Street money. It had a lot of money from real estate people. So it had a lot of cash.
It had great corporates, right? So if you need to do partnerships, if you're a B2B company, you need distribution. All the corporates are based in New York. Incredible talent, right? All the engineering schools are in New York. And then customers, right? If you need to reach customers, they're here. So when people told me I needed to go to California to build a company, I thought that was actually insane. That the makings of a great ecosystem are some of the things that I just mentioned.
So I was excited to just lean in. And so being a little bit of an outlier and saying, like, yeah, I'm going to run my company here, it wasn't super easy. I mean, there are those challenges because so much was being built in Silicon Valley. But I leaned in, and through those years, just got to know people on the ground. And you figure out who are really builders and who are community builders and who are people that want to give first and give back.
and you just start spending time with those people. And so that was kind of how it happened. And now New York has moved to, I think, the second biggest ecosystem in the planet. And I don't think there are too many people that would argue that it's not an amazing place to build a company, but it just takes time, right? You need to develop that fabric and that muscle. And now what's cool and why we started the fund was now you have founders that have maybe had a little success.
and they're starting to kind of recycle their own cash into the next generation. And we think that's an amazing moment. And that's what Silicon Valley has been so great at, those founders kind of giving back and really reinvesting into local founders. Now we're seeing that New York and beyond, right? And the pandemic has really opened that up, I think, where most of us believe that innovation is happening everywhere and that historically cash has been concentrated in a few areas.
jenny (17:19.338)
or a few localities. And now, especially with crypto, even that's being challenged. And now cash is everywhere. Again, I'm in Portugal, and I had dinner with a few different people that are running $500 million alternative funds here in Lisbon. And they're here for the lifestyle, and they're here for the community. And so to be part of something that's being built, I think, is really exciting.
slava (17:44.727)
So as COVID is transitioning to endemic instead of pandemic, do you think that the investor bases are going to go back to the main cities, which is like Silicon Valley and New York, et cetera? Or do you feel like the cat's out of the bag, Silicon Valley is a mindset, it's no longer a geography, and it's just being spread around the world? If it was A or B, which one do you believe in?
jenny (18:09.622)
Definitely be. I mean, I think that it's a real eye, you know, it's eye opening, whether it's remote work Or people living the nomad life. I think you know, it's just been a real mindset shift and that's pretty exciting It doesn't mean that people don't want to gather in person. And so I think the hybrid work situation for example
Whether you're a venture team or whether you're a startup, to spend a week together somewhere and really build and whiteboard and spend time together, I think that won't go away. But do you need to walk into an office every day? Do you need to commute an hour and a half? I think those days are pretty much gone, especially in the startup world. So I'm really bullish on the new modalities of working. It's one of the three areas that we really invest in is what we call the future of work.
slava (19:03.667)
And what are the other two things that you're looking to invest into?
jenny (19:08.286)
Yeah, so I call it the table stakes economy. What are the things you actually need to live? And so that's money, that's health, and that's work. Everything else is great, but if we don't have those fundamentals, it's really hard to live a thriving life.
slava (19:26.439)
Wow, I think you said that before. That was quite concise. And if there's listeners that would like to try to pitch you, what's like the right stage, the right amount they're looking for, do you lead, follow? How would you explain to the entrepreneurs what you're looking for?
jenny (19:44.15)
Yeah, so we run a founder community really called The Fund. Our cash comes from other founders and operators. And so we welcome anyone that's product led, building in one of the three verticals that we've talked about. You can email us. You can email me. I'm easy to find on LinkedIn. We invest only at pre-seed. So that means rounds that are directionally 500.
to about $2 million. We like to be the first check-in. We invest $50K to $250K. So depending, we're happy to lead or to follow, we really pick our fund size and our check size based on being collaborative. So what we believe is at the earliest stages, it's really cool to be able to call our friends who are running other venture funds and really put together an incredible syndicate for founders. We don't have sharp elbows, and we're not ownership driven. We're really community driven.
slava (20:43.731)
Great, and then you've seen, I'm sure, every version of type of early stage company. So let's call it incubated companies, accelerated companies, bootstrap companies, solo entrepreneur, multiple founders. Is there a version that you think is the best? Is there like kind of this template works better than that template or the other opposite, which is these versions are not good. I tend to shy away.
from that type of setup at the pre-seed level.
jenny (21:16.426)
Yeah, so I don't think there's one archetype actually for a successful founder. I think you have to find investors that you jive with. For me, I'm kind of looking for some basic things. I'm looking for founders that have that vision of the future, as we talked about with Chainalysis, who see a future that maybe I don't see, but they have a very clear sense of what it is and how to get there. I'm looking for a founder who is resilient.
this is going to be a 10 year journey. And I worry sometimes about some of the founders that are starting companies now because it's trendy and it's fun. But when you run out of cash and you can't pay, you know, your employees, it's not so fun. And so you need to have, you know, that resilience. And then the last thing is, you know, we're really looking for founders that have an open mindset. And so that doesn't mean, you know, sometimes people use that word like coachable, which I don't really like. It's that, are you responsive to data?
And are you willing to pivot to an opportunity if one presents itself? And so I think that learning mindset is pretty critical. So I'd say those are the types of archetypes that we're looking for. Again, we invest across verticals around pre-seed. We're kind of looking for that sensibility in the founder.
slava (22:33.399)
And then how did you know that this is what you wanted to do? So it was early and you started, as you said, mentoring and helping and then got sucked in. There's some others on the podcast who might be listening and saying, well, I've done a few checks or I've advised a little bit, but I'm not sure if I want to do this for a living. What is it that happened or happens that this is what I want to do for a living?
Let's call it the rest of my life.
jenny (23:04.254)
Yeah, I mean, I'm super lucky in that I do feel like I found my life's work. And, you know, I've had a few different careers. I went to law school and I built a company and now I've been, you know, investing in companies. And I do feel that helping founders, you know, surrounding them with resources, really being that connective tissue to, you know, their next rounds of capital, being that, you know, being that sounding board early stage.
is really what I'm great at and what I love to do. And so for anyone that's looking to get into venture, just figure out how you wanna spend your time. This isn't about really putting money to work. The cash is really the commodity. It's about human interactions, right? And it's about really being part of the process. And so when I invest in a company, I feel like I'm a co-founder of that company and I feel the emotional ups and downs not as acutely.
But I feel like I'm part of the journey. And so I think if you want to invest early stage, you kind of have to have that excitement, that drive, and that sensibility. And then again, it's not really about putting money to work. It's about unlocking human potential in other people. And so I've been lucky to be very small parts of other people's journey, but hopefully impact them in that respect.
slava (24:23.371)
So approximately how many investments have you been a part of?
jenny (24:28.191)
More than 200.
slava (24:30.335)
Perfect. So over 200 investments in, what have you learned now that you would tell Jenny putting in the first investment? Like, hey, these are three things you should do better and know that now.
jenny (24:45.57)
to my younger self. I would say.
slava (24:48.063)
Sure, or to the listeners out there, but it's good to your younger self, but yeah, to the listeners out there as well. But putting it into like an inception times warp to your younger self is kind of like a good way of hearing what you think.
jenny (25:00.942)
Yeah, I mean, I think like believe in yourself. I mean, if I was writing very small checks at the beginning, if I had access to a larger capital, you know, you know, some of my early investments would have been pretty significant. And so I think when I got into it, you know, I felt a little bit, maybe insecure. But I think I had great instincts. And it just, you know, the problem with venture is it takes, you know, five to 10 years to know if you're any good at it. And so when I hit year five,
I had returned zero capital to any of my LPs, the people that had given me money. And I started to think, huh, I'm not sure if I'm so good at this. Maybe I should go back to being a founder. I sold a company that was pretty successful. Maybe I should build another product. Interesting, when I kind of started to think about that, I'd say it was year five and a half, I had my first meaningful exit, which returned a fund that I was running. And I thought...
Oh, okay, that's giving me some interesting confidence. Because as someone who's kind of like type A and is used to validation, you don't really have that adventure for quite a long time. You have people mark up your deals, but until you return capital, you don't know, you have no idea how you're doing, and it takes a long time. So I think what I'd say to myself is like, believe in yourself, believe in your instincts.
and don't second guess it just because you don't have quick results. This is not a game of quick results. And I think I knew that intellectually, but it just felt hard after five years. Just like, you know, wow, I don't know if I'm good at something that I'm doing. I'm putting all my, you know, my effort into. And I do feel like it's my life's work, but I don't know if maybe I suck at this.
slava (26:45.707)
Do you think 10 years from now, your 10 year future self will say the same thing to your current self that you weren't being bold enough?
jenny (26:53.926)
Probably. I should go raise a much larger, larger fund that I'm doing. Yeah, probably. But isn't that, isn't that a... Probably.
slava (27:00.491)
I don't know, I'm just asking.
slava (27:06.864)
Okay, great. And then any trends that you're looking at? I mean, obviously you have your three anchor kind of verticals, but are there kind of market trends, investing trends, anything specific that you're kind of looking for in the next five years or in the years to come?
jenny (27:23.646)
Yeah, so something that's been interesting, you know, started off really investing kind of locally more in New York. Now our fund is completely global. We've done seven deals in Nigeria. We've done, you know, half a dozen in Latham. And so my trend is that, you know, forget about building outside of Silicon Valley and comparing that to New York. We need to all start thinking globally. Founders, innovation is everywhere.
And we need to start supporting and investing in those founders globally. And we're seeing, you know, incredible companies being built in all kinds of markets, many of them developing markets. So, you know, my thing to, to really lean into is, um, you know, developing deal flow communities and, um, and portfolio in some of these areas.
slava (28:17.683)
Great. And then a lot of our listeners want to be more like you, Jenny. So they want to know what you listen to, what you watch, what you read. Are there examples that you can share that we can then try to be more like you?
jenny (28:32.471)
Well, honestly, I learned a lot about venture. I always come back to this book called Venture Deals, and I pick it up all the time. I have two copies in my home. It's a book that Brad Feld wrote, who's one of my mentors, and it really just goes through the fundamentals of a venture. I think when you get into this, again, really investing is different than
running a fund, understanding the fundamentals behind a term sheet, behind venture math, all those things. And so Brad just breaks it down in a very simplistic way, which is pretty brilliant. So yeah, I always revisit that and open up that book. And so I encourage other people too as well.
slava (29:16.899)
And how about like day to day? Is there specific content or podcasts or blogs or things you like to watch just to keep up the date or get interesting information or this is your best places to get the scoop?
jenny (29:31.026)
Yeah, I mean, again, like I read all the tech rags like you probably do as well. But I think, you know, again, we're investing for the future. And so looking at, you know, thoughtful content that's coming out, you know, old school Fred Wilson and just some of the people that are talking about directional trends, I think are pretty interesting, right? Because if you read Fred, he's he talks about when he first got interested in, you know, in alternatives and in Bitcoin and.
all of that, like even way before I did. And if you look at what his instincts were and how he cultivated a thesis around it, it's pretty interesting. So I like to follow some of the more seasoned venture capitalists who had their finger on the trends long ago, because again, I think a lot of what people are looking at today is what's happening today. And that's less interesting to me. I wanna invest in things that we think are happening in the future.
slava (30:29.279)
And you tend to be pretty active on Twitter, beyond giving yourself a voice there. Is it helpful for you in terms of predicting the future, triangulating information, doing research?
jenny (30:40.618)
I mean, I meet a lot of interesting people on Twitter. Actually, someone reached out to me. They'd saw something that I had posted and that person became an LP in my fund. So you really don't know who you're going, and not a random angel, like literally an institutional fund. So you never know who you're gonna reach. Yeah, no, totally amazing. Like I never would have thought that happened. So, you know, I don't have a huge...
slava (31:00.439)
Amazing.
jenny (31:07.886)
but it's definitely fun to be involved in the conversation. I learn things all the time and yeah, it's great to just create a point of view. And I think I have a lot of younger VCs ask about creating a brand and I think so much of it is just like taking a stand and having a point of view. You won't always be right and many people won't like your point of view, but kind of sticking with it.
I think is the way to develop a little bit of a brand around yourself. And so for me, it's all been about supporting founders at the earliest stages of their journey. And everything that I do, I kind of come back to that true north of mine.
slava (31:50.075)
And the last question we always like to ask is to put the guest on the spot and ask, you know, three years from now, what do you think will be a great investment that you can make today? So what specifically would you invest in that our listeners can keep track of, maybe even invest alongside with you? And three years from now, we'll check how that did in the alt space, any alt.
jenny (32:13.574)
any alt meaning. Give me some categories.
slava (32:15.923)
Anything that's not public, anything that's not a stock, basically. You could pick any private startup, any tokens, any crypto, any NFTs, any sports cards, any you name it.
jenny (32:19.6)
Okay, so again.
jenny (32:26.214)
Okay, well, I'm going to come back to what I know, which is I invest in a lot of fintech, and I think what's happening in Africa is just incredible. So we invested in a company, the first tech into a company called Dash. It's a mobile wallet based in Kenya, and they just closed 34 million seed round, which was the second largest seed ever on the continent. This company is really helping people.
transact across the continent, right? And so, you know, I would really suggest that people look outside of the US because the markets are huge and the opportunity is really untapped, right? There's a lot of noise in places like the US and there's, you know, wide open space in developing ecosystems.
slava (33:16.779)
This has been an absolutely great journey. Thank you, Jenny, for the conversation, from talking about helping founders and becoming an angel investor, believing in yourself, Silicon Valley becoming a mindset, going from New York investing to you now going global investing into Dash in Africa. It's been a great conversation. Thank you very much for your time.
jenny (33:36.023)
Thanks so much.
