Jessica Peltz-Zatulove of Hannah Grey // a first check venture fund investing in founders reimagining everyday experiences [CC070]

Jay Clouse 0:00
Eric, do you know what I love to have for breakfast?

Eric Hornung 0:03
A big ol bowl of Jay-O’s. I just imagine you have a box of cereal with your face on it.

Jay Clouse 0:09
I was going to say reviews on Apple podcasts. They give me more sustenance than anything else in my life. They bring me energy, they get me ready for the day ahead. And you know, Eric, it’s been, it’s been a minute since I had a good bowl of reviews on Apple podcasts.

Eric Hornung 0:23
Sometimes I read my reviews right before I go to bed just so I can dream good dreams at night.

Jay Clouse 0:28
If you want to help me start the day right. And help myself esteem while also helping us in the eyes of Apple. Please leave a review for Upside on Apple podcast. If you have an iPhone, even if you don’t use Apple podcast, we would love for you to submit a review about why you love upside. And if you don’t have an iPhone, if you’re an Android user, that’s okay, too.

Jessica Peltz-Zatulove 0:49
We really understand what these early signals of success are. So it’s really about how do you create a brand that is identity driven, that creates a sense of belonging that inspires you to participate in the community. And that’s why you know, we really believe that education and community are the new acquisition.

Jay Clouse 1:07
The startup investment landscape is changing. and world class companies are being built outside of Silicon Valley. We find them, talk with them, and discuss the upside of investing in them. Welcome to Upside.

Hello, hello. Hello, and welcome back to the upside podcast, the first podcast finding upside outside of Silicon Valley. I’m Jay Clouse, and I’m accompanied by my co host, Mr. Cool middle name himself, Eric Knight Hornung

Eric Hornung 1:48
I have a lame first name and a hard to pronounce for most people last name, but my middle name is pretty sick. I like it.

Jay Clouse 1:55
What’s the what’s the origin story here? Where does Knight come from?

Eric Hornung 1:58
It was my grandpa’s middle name, too. I think it got passed down through a couple of generations. So I assume that either someone lied about being a Knight in my family’s lineage or was actually added at some point. I don’t know.

Jay Clouse 2:08
I feel like you know, you have this handle of EkHornung on I feel like you’re optimizing the wrong part of the name. I feel like E.Knight H, or just E.Knight would be even better.

Eric Hornung 2:20
I’ve long told myself if I write a book ever. I will go by E.Knight on the book. So this is the second iteration of Eric on online life. Everything was Eric.Hornung, then it was Eric.Knight.Hornung Then the next one will be Eric.Knight and then online and everywhere. I’ll just be Eric Knight. Because I think Jay, I have a large bet. And actually, someone asked me about this the other day that online privacy is going to become a luxury good in the next two decades. And that’s why my picture doesn’t exist anywhere online. It’s all that cartoonized version. Because I don’t in my name, I want that to be off too. So it’s a transition. It’s not gonna happen immediately. But I believe that privacy is going to be a huge luxury good into the future. And only the richest people are gonna be able to afford it or the ones who are thinking ahead of time.

Jay Clouse 3:12
How do you marry this this luxury, good of online privacy with the growth of people wanting to be independent creators and make a make a living from their self?

Eric Hornung 3:22
Mark Twain’s name wasn’t Mark Twain. There’s nothing that says you can’t be an independent creator or creator in general with a different name than who you actually are.

Jay Clouse 3:30
So do you think we’re gonna see more and more pseudonyms?

Eric Hornung 3:32
Yes, I do.

Jay Clouse 3:33
All right. You heard it here first.

Eric Hornung 3:35
Do you know people’s name?

Jay Clouse 3:37
Yes. Michael Hartman.

Eric Hornung 3:39
While you’re pretty dialed in. I’m guessing most people don’t. Yeah, I think we will see more and more of that splitting your online self from your in person self.

Jay Clouse 3:51
Well, speaking of names, today, we’re speaking with Jessica Peltz-Zatulove, a founding partner of Hannah Grey, a first check venture firm, investing in visionary founders, reimagining everyday experiences to improve work in life. And Eric little preview of the interview here, I believe Hannah Grey is a mishmash of names from Jessica and her co founder Kate Beardsley, who’s been on the show. Their daughter’s names. So that’s how I tried to tie this together. But sometimes the segways work well sometimes they don’t.

Eric Hornung 4:24
Hey, you named it how you saw it, you know? And that worked out the listeners get it you tried. You can’t always succeed in this one life you have Jay,

Jay Clouse 4:33
You got to take your shots and those shots are what help you live the one life you have to live the best way you can. And if you want to live your one life the best way that you can visit our friends, Ethos Wealth Management by going to upside.FM/Ethos.

Eric Hornung 4:48
You know what’s exciting about this interview Jay.

Jay Clouse 4:49
What’s exciting?

Eric Hornung 4:50
Even though Kate wasn’t with Hannah Grey at the time that we interviewed her this will be the first time that we interview every single partner at a venture firm.

Jay Clouse 4:59
Very fun. Very cool. And we’ve actually been in touch with Jessica for many, many months, we’ve been pleading Jessica, please come on Upside for many months, and we’ve just had some rescheduling and the timing wasn’t great. It got to the point where we wanted to talk about Hannah Grey and just wasn’t yet time to talk about Hannah Grey. But Eric, the time has come. Jessica, who has referred half a dozen guests to the show will be here talking about Hannah Grey, and also talking about Global Women in VC, which she co founded, the largest and most active community for women, investors, empowering women VCs around the world to better find each other to connect, collaborate and create a sense of community.

Eric Hornung 5:41
If you want to talk about Hannah Grey, or Women in VC, or anything that comes out of this episode, you can reach out to us @upsideFM on Twitter, or if you have something a little longer, you can reach out to us at hello@upside.fm. And we will get to that interview right after this.

I hate that we’ve demonized scheduling links, Jay.

Jay Clouse 6:04
Scheduling links are actually one of my favorite things. I love the ease of someone saying here’s where you can book a time with me. And then I can choose when it’s best for me too.

Eric Hornung 6:12
Whenever I get an outreach and someone says what time looks good for you. I asked them, hey, do you have a scheduling tool? And you know what scheduling tool I wish they had?

Jay Clouse 6:20
Which one is that?

Eric Hornung 6:21
It’s a new scheduling tool called SavvyCal. SavvyCal makes it easy for both parties to find the best time to meet.

Jay Clouse 6:28
SavvyCal makes the scheduling process even more savvy than any other scheduling tool that I’ve seen. And I mean that. It makes it so easy to personalize your link, you can say hey, this is a meeting time for Jay and Eric. And it just looks so professional, so sophisticated.

Eric Hornung 6:44
So much so that we’re going to be using it for Upside going forward. And maybe even rolling it out to the Upside network.

Jay Clouse 6:51
You can use SavvyCal as well. You can sign up for a free account at SavvyCal.com/upside. That’s savvycal.com/upside. And when you’re ready to upgrade to a paid plan, you can use the promo code Upside for a free month.

Eric Hornung 7:12
Jessica, we like to start on Upside with a background of the guests you can tell us about the history of Jessica.

Jessica Peltz 7:19
Yeah, absolutely. So I actually grew up in Minnesota, which I feel like is pretty relevant for this conversation and actually really only comes out when I say I’m from Minnesota is when my accent seems to kick it.

Jay Clouse 7:30
I heard it. Oh, yeah.

Jessica Peltz-Zatulove 7:31
Every now and then, uh, you know, we’ll sneak in there too. So grew up in Minnesota, went to school at Indiana University, and then moved to New York after school. So this was around 2003. I was about a year and change after 911. So still very different city, I would say. But I started my career on the customer side. So I spent over 10 years at a global advertising agency, I was running the media strategy for brands like H&M, Gucci, Puma, 20 Century Fox, Verizon, Georgia Pacific was very fortunate that I was running Verizon media strategy from 2009 to 2012, which just changed the trajectory of my career, because I really had a front row seat in terms of how consumer behavior was shifting more towards mobile adoption, the app store was exploding, the New York tech ecosystem was really starting to blossom. So I started working with startups on the side, and just fell in love with the space. You know, I actually launched the Android device for Verizon, and I did the industry’s first ever iPad sponsorships with Sports Illustrated, and People Magazine. And so when I started working with these entrepreneurs in New York back in this, this was around 2010, 2011, I very quickly realized as a non technical female, that my background as a marketer, was really helpful to these founders that were more product or engineering guys, and just didn’t know how to commercialize their business. So they didn’t know how to get their first customers how to do brand building, how to do community building or content strategy or community building. And so that really became my superpower in the startup community. And so around that point, I started to bring the startup founders I was working with to my brand clients at the media agency, and identify that there was really this, this gap that was happening, this disconnect of big brands wanting to connect with startups, but they were just not speaking the same language. They had no idea how to collaborate how to work together. So realizing that there’s this deficiency, I ultimately decided to leave corporate in 2012 to go to a startup myself, I wanted to get my hands dirty and get some operating experience. So I joined one of the first innovation boutiques called Evolution as their second employee. And that’s what we did. We specialized in helping startups get their first customers, so connecting big brands with emerging technology. So I was working with brands like Kraft Foods and Mondelez and Unilever ended doing some of the industry’s first ever influencer campaigns and marketing campaigns around connected devices. So really being on the cutting edge of what are what are marketing applications for emerging technology, help them scale that business to a few million in revenue, and then ultimately transition to corporate venture capital in 2014. So for six years, I was running the corporate venture practice of MDC partners, which is a publicly traded holding company for advertising agencies, investing in early stage companies that meet the needs of what we were calling the modern cmo. So what are different technology solutions that are changing the way that brands can interact with their customers. So we did a lot of investments around content and data and SaaS and audio, again, really loyalty anything that really changed that relationship between customers and big brands. And then ultimately, last year left to start Hannah Grey with Kate Shillo Beardsley, who is hands down the best kept secret in venture, obviously, you guys know Kate well too.

Jay Clouse 7:50
Friend of the podcast.

Jessica Peltz-Zatulove 11:04
Friend of the podcast, and we launched officially Hannah Grey, which is now our own early stage firm first checks fund. Investing in founders reimagining everyday experiences to improve work and life. So along that journey, I can kind of pause, we want to pause there, because there’s a lot to unpack. But then also in 2015, co founded Women in VC, which obviously is very on thesis as a friend of what you guys are doing here at Upside too.

Eric Hornung 11:29
We’ll get into Women in VC and Hannah Grey in a minute here. I want to jump back to something you said earlier, which is that these large brands and these small companies weren’t speaking the same language. Can you dive into that a little bit more about kind of where the greatest propensity for something to get lost in translation is?

Jessica Peltz-Zatulove 11:47
Yeah, absolutely. So one of the biggest disconnects that I saw on the founder side is they didn’t always understand the workflow of what the brands needed, what their customers needed. So not just in terms of their business model and how they work. But in terms of how you get through procurement, who would be your stakeholder at the company? Are you selling is to the CMO? Is this an e commerce solution? Is this a data solution? And then how do you package your company and tell the story in a way that fits into their media plan, into their marketing plan to really help them execute. And that’s something that again, it’s just these brands, and that a lot of these CMOS, they’re they’re used to seeing things presented in a certain way, they’re used to a business model being presented a certain way, back in the early days were like, what is SaaS? What does this mean? Like I need a I need a campaign that goes against my back to school campaign or for my fall fashion campaign, you know, they there’s a bit of a learning curve there in terms of how you scale something across the full calendar year, and really have it be integrated into your full marketing plan. And at the same time, they started up, they just, they didn’t necessarily know the nuances of how their customer worked and got contracts approved. So that was really a lot of the work. Because sometimes I would be working with these founders that could be sitting on a brilliant transformative business, but just not really like something was missing in terms of how they communicate that to the customer in a way that makes sense with their ways of working. So really understanding how to bridge those two worlds to help startups find their first customers and commercialize their business is just something that, you know, we’ve really been focusing on for the past 10 plus years.

Eric Hornung 13:23
You mentioned early on, like identifying the right people at the large organization.

Jessica Peltz-Zatulove 13:28
Yeah.

Eric Hornung 13:28
We have so many founders on who talk about kind of these large logos that they want to bring on as customers are like, yeah, we’re talking to them and this pipeline, and so often, it’s like, Who’s the right champion within an organization? So how do you think about identifying a champion in a large organization? Is it title based? Is it influenced based? Like, is the CEO always the right champion? How should a founder think about finding that first customer and specifically that champion within the first customer?

Jessica Peltz-Zatulove 13:53
Yeah, it’s a great question. And the answer is, it totally depends. I’ll share one quick anecdote about what I was saying before about just sort of that disconnect. As I was remembering back in 2011, 2012, I was working with this brilliant founding team called TripleLift. And they called me and they said Jes, hi. So we just got an RFP from Victoria’s Secret. And I don’t know what that is. I just said we don’t do it. And I was like, Yes, you do RFP’s.

Eric Hornung 14:21
No.

Jessica Peltz-Zatulove 14:21
This how you do it. And so I remember I, you know, I went over to their office after work, we like whiteboard out this, this whole thing. And I remember just talking to him and be like, okay, so at the 25k level, you can do this at the 50k level, you can do this at 100k. And then you can charge more here, less year, and I just remember, I just remember seeing the wheels turning in his head of saying, like, I can do that, I can charge for that, I can do I’m like he’s like, but I only pay this for I’m like, yeah, this is what you do. And it was just this lightbulb moment. And now TripleLift is one of New York’s premier ad tech companies. They have hundreds of employees around the world. And so that was really their first customer that they want. And so it’s just an example of like, there is just there’s different language and different nuances of ways of doing business. Obviously, an RFP is just one example. But there’s a lot of these different examples. So in terms of your question about how do you find the right stakeholder, it’s less about a title, and more about who can you get to become emotionally invested in you and your value proposition and how it can transform their business. And that’s something where like, I don’t think it’s necessarily the CEO, because guess what the CEO is not going to be the one doing the work, especially at these big brand logos they’re getting, they’re going to send an email to someone who’s going to send an email to someone who’s going to send an email to someone, and it’s just gonna get lost. So at this earlier stage, and when it is something I remember, when we were doing some of the first campaigns or on mobile wallet, or some of the first campaigns around influencers, it’s less about, this is a CMO. This is a brand director, and it’s really about what champion can you find internally that just really believes and how your business can be transformative for their results. And I think that’s something that startup founders always need to just keep in the back of their head, which this is gonna sound really frustrating. But it’s kind of just an inconvenient truth is nobody gets fired for buying Facebook ads. Nobody gets fired for buying ads on YouTube. So there’s often not an incentive to experiment. And it’s just part of a company culture that you as a founder need to suss out and to understand, like, what are their motivations for testing my business? And what is it going to do for them? What could be the repercussions if this fails? Is this a culture is does this brand have a culture of failing? And is that going to be okay? Or is it going to be really uncomfortable for them? You know, and there’s no, there’s no right or wrong answer. It’s just I think having some of those really open conversations with your brand client of saying, what are our KPIs? What does success look like? because let me tell you a success is not going to be 50,000 5 million people like the reach you might be used to. So let’s really collaborate on like, what do we want to learn out of this experiment? What are the three KPIs we want to learn? And if we prove this, right, is that going to be valuable to you? How do you see this improving your business? And so I think framing the conversation that way? Well, just number one, get them, get them talking and get them more invested in the success as opposed to you selling whatever phenomenal content or data play that you have really take the time to listen to? What do they need to accomplish to meet their business goals, and then see how you can really position yourself as a solution to meet the needs of their organization. It’s one of the biggest I’d say, like Jedi mind tricks of working with marketers is, there’s not always that culture that embraces failure. We used to say, when I was at that innovation consultancy, that if this pilot fails, that’s a just as successful as doing something that succeeds. Because then we’re learning what not to do, which again, will help us just iterate and learn for the next time what we should do. But it’s having really that open dialogue of just really understanding the culture and getting them excited about how it can add value to their business or their customers. That creates that connection that will help them shepherd you through their process, because you’re gonna have to go through procurement. That’s a huge pain in the ass. Not that I don’t love a lot of procurement people, but you know, it’s like, it’s it can be a challenge. Do you have to present like, just understand what is that process to get to? Yes, and then who would be my stakeholders from there is really a more streamlined, efficient way to work with brand partnerships.

Jay Clouse 18:33
You talked about this, this wild opportunity of helping Verizon media strategy from 2009 to 2012. And then you mentioned around the same time, you’re starting to work with startup founders in your background in marketing was really helpful. How did those things interplay? Why did you start working with startup founders?

Jessica Peltz-Zatulove 18:49
I just saw that there was this, there is a shift and there is an opening in terms of the way consumer behavior was changing, and that everyday experiences were being reimagined. You know, I live in New York City, which I recognize is a little bit of a bubble. But I remember be like, yeah, I could just like lift up my hand and call a taxi. But there’s also this app that now I could just wait in my apartment and the ride will come and so I I think I just I recognize that number one, things were growing really quickly. We actually we hated the iPhone at the time because it was locked into AT&T right and couldn’t access it. And so then that’s when we launched Android with us just horrible droid does robotic campaign and we thought only millennial males were going to buy it. That campaign was actually like I do or I don’t it was, yeah, it was pretty, it was pretty bad, whatever it was, but more so I just, I started to see I remember when I first started working on Verizon, it was something like 30% smartphone penetration. And so we started calling it the clamshell phone versus moving into smartphones. And so what really an aha moment was for me is our strategy. When I first started on the business was starting to move away from stealing customers between carriers. So originally it was all about getting customers from T Mobile from Ssprint from AT&T to move into Verizon, and the KPIs and the objectives was more about getting people to upgrade to their data plans and getting people into this, these new devices that were way better than like a phone or some of these other shitty devices. And so recognizing what the power and the adoption had been with iPhone and what the promise was for Android, and just all the creativity that was coming out of the app ecosystem, it just kind of started me on this path and this journey around what will the world look like as these technologies continue to evolve. And then I think one of the biggest aha moments, I remember being in a meeting with a publisher of Sports Illustrated, and he’s talking, I’m totally dating myself. But he’s talking about how you can read the article about the home run at the game last night, and then tap the screen to watch the video. This actually happened. I was like, holy shit, this is just completely going to transform the way we interact with content and the way we interact with brands and media. And of course, he was talking about the launch of the iPad and like their iPad app that they were that they were launching.

Jay Clouse 21:12
So it sounds like you were taking just personal initiative to meet startup founders, because you’re seeing that.

Jessica Peltz-Zatulove 21:16
Oh, yes.

Jay Clouse 21:17
And you’re you’re getting interested. It wasn’t something that was happening like at work, you’re just like, this is interesting. I want to meet people who are who are leading this.

Unknown Speaker 21:23
Yeah. And ERA was launching around them too Entrepreneurs Roundtable, which is a phenomenal accelerator here in New York. I had some friends that had gone to work at startups, a good friend of mine was early at OMGPop. So if you want a real throwback, she was a product manager on draw something. And if any of you remember that game, which just blew up like practically overnight within six weeks, and so there was just a lot of this excitement and energy happening. And then your startup ecosystem. I also had started to read some books. I had read lean startup, I had read startup nation. I actually was in Tel Aviv on vacation, New Year’s Eve 2011, I want to say, and I had just read Startup Nation. And so I remember I posted on a bunch of LinkedIn groups like mobile Monday, Tel Aviv tech, bla, bla, bla, and I was like New York media exact coming to Tel Aviv, I just want to meet with cool startups, like I work on Verizon, and H&M and Gucci, like anybody that wants to just jam with me, I’m gonna be at this coffee shop, just like DM me. And I ended up just hanging out in Tel Aviv for an extra week meeting with entrepreneurs that would just kind of come in and pick my brain about marketing and the market and the brand. And I just kind of recognized that a lot of my perspective that I took for granted, in terms of how to work with customers, how to build a brand, how to do content, how to do community building was just, it’s something that can be so hugely helpful to businesses, but it was, it was often an afterthought around building product, and you know, finding product market fit, but being really scrappy and creative with customer acquisition. And so from that moment, again, it was around like, 2011 ish, I just, I recognized I was like, why am I buying a shitty homepage takeovers, when I can work with these founders that like really are changing the world. And so from that moment, I was just like, no looking back, and I’ve been working pretty much exclusively with early stage founders ever since in different capacities.

Eric Hornung 23:19
Take me into your experience at corporate venture capital, I feel like in all of the realms of the VC world, the corporate venture capital world has the widest dispersion of experiences. Some people go into excited about VC and leave saying they’ll never work in VC, some. Everybody has a different corporate VC story specifically. So what was your kind of takeaways from corporate VC that made you say, Yes, I want to come out of this and launch my own fund.

Jessica Peltz-Zatulove 23:46
I think corporate VC gets a bad rap. I think ever since Fred Wilson called us the devil, it was like a little bit downhill from there, which, you know, we did a lot of reputational repair. No, I’m just kidding. But look, corporate VC is becoming a major player in the space in terms of just being a viable source of capital. For founders, I think it’s something like 25% of all 20, maybe give or take is corporate VC money. This is my take on corporate VC, everyone is going to have a different process, everyone is going to have a different motivation. And everyone is going to have their stick, right? A lot of corporate VCs will say that they’re their smart money and their strategic money. And I believe that’s true, because corporate VCs often are the customers. And so as a founder, I would say, I’ll reverse engineer to say what I think you as founders should be asking questions of the corporate VC, is I think you need to say number one, why do you have a corporate venture practice? You know, what, what is it about working with startups that make this an interesting initiative for you and your team to spend your bandwidth on? Are you looking for an acquisition target? Are you looking for commercial opportunities? Are you looking just to learn to look at it as an as a research and development tool like there again there’s a lot of motivations behind why corporate vcs exist and why there’s just been an explosion of them over the past five plus years. Number two, i would ask what’s your process, are you the decision maker, do you have an investment committee, how often does that investment committee meet, where does your money come from, do you invest off the balance sheet, do you have a dedicated pool of capital that you earmark and the reason that’s important is because if their balance sheet investors then there can just be nuances to that where your corporate venture practice is probably a rounding error compared to their broader market path and so depending on what’s happening in their category in their competitive set or what their business priorities are sometimes if they’re number one i can’t tell you how many times if i was closing a deal on march 15th, i was like can i just wire on april 2 because that would be really helpful for my quarterly reporting because again like you have shareholders to do so not a bad thing just something to be mindful of or if it’s fourth quarter they might need the capital on their balance sheet to hit their earnings so again none of this is a bad thing it’s just the more you can be armed with some of these nuances to ask these questions will just help you better manage expectations so absolutely ask your own process, ask what you should expect, you need to talk to business units, do you need to present to an investment committee, how long do you take, do you need to do a pilot test, do you do commercial deals and then number three which i think is most important is what can i expect from you as a partner assuming that i take your capital and you know we’re excited to work with you what can i expect that post investment support to look like how do we get a commercial deal done and you know they’re gonna say we can’t guarantee partners, we can’t guarantee revenue and that’s totally fine but are you going to help me have a roadmap to how to navigate your procurement team, are you going to introduce me to different key stakeholders across your organization, can i pick your brain on on my product roadmap or on feedback to kick the tires on does this work does this not work. How do you feel about me working with your competitors because i’m going to and you got to deal with that but like let’s talk about it so there’s not surprises and so i think that the more you can just set the foundation of a really transparent open dialogue with corporate VCs that can be hugely helpful and hugely beneficial where i think it can get uncomfortable is if you have people at a corporate VC that are not full time so i think that you know if they don’t intentionally mean to goes founders but they’re just dealing with other shit they have going on in the organization like that can happen or if the corporate VC arm is very detached from the core business that they might not know who to talk to and so i think different corporate VCs just have different processes and so for you as a founder you might think this is incredible i got insert expert here to invest in me but like what does that mean in terms of value creation for you and so as rounds just get more and more competitive you know Kate and i talk a lot about liquidity management as companies are staying private longer and as funds are staying private longer there’s about $73 billion that went into venture capital last year that’s that’s more than quadruple the amount of capital that went into vc funds in 2010 it’s almost double the amount of money that startups raised it was actually a $73 billion that went into vc funds last year which is again about quadruple how much vc funds had raised since 2010 and i think it’s something like about 156 billion that went into startup investments and so capital is getting competitive but the point being is that when there is so much money and capital available for founders now you can be selective if you have a great business you can be selective about who you take capital from because now everybody has a venture fund, right? Corporates have one, celebrities have one, athletes have one more and more micro VCs out there now. So you as a founder should be really blunt. Ithink a little foot spin never hurts to say you know what is our post investment relationship look like, what should i expect from you and then ask to talk to founders and their portfolio to just validate and back that up that’s a that’s i think probably how i would think about working with corporate VCs in this space and in terms of why i left and started Hannah Grey, i’m thrilled to collaborate with my past corporate vc they’re phenomenal people for me when you’re at a strategic you are you are connected to the strategic mandate that that company needs you to execute on against. And being in one of these moments of disconnect i was just seeing so much incredible solutions that were happening in fintech and education and wellness that were just very off thesis to what the corporate needed us to focus on and so it was one of those things where i just couldn’t feel like i was sitting on the sidelines and when i was able to partner with Kate i was like there’s nobody on this planet I would rather partner with and so we just, we just have to go for it.

Jay Clouse 30:04
I’m going to resist the temptation to go into Hannah Grey. Right, right. Right, right right now, because I feel like to color that discussion, we need to learn a little bit more about Global Women in VC. Can you talk to us about why you started Global Women in VC.

Jessica Peltz-Zatulove 30:17
So Global Women in VC, I started in 2015, with Sutian Dong. So think about the backdrop for that, right? I had just transitioned to corporate VC in 2014, was really trying to learn and just wrap my head around this new industry that at the time, I had only met a few other women, which again, back in 2014-15, was just kind of how it was, and so on. When I met ctm. At the time, she was at first mark partners. And I remember just saying to her, you know, is there just a group or something for women to connect? And she was like, Ah, there’s not, but there should be. And I basically said, Well, I like planning parties, and I selfishly want to know, everybody. So we should just start something. And so in February 2015, a little over six years ago, now, we had our first event in New York City, there was about a dozen of us on a rooftop bar. And we’re like, wow, there’s about a dozen of us. That’s amazing. And then we started a spreadsheet at the time, it was a spreadsheet. And we just had started to have women put their information in, you know, what do you invest in, what stage, what’s your cheque size, do you lead rounds. And really, I started that, because it was scratching my own itch, just put this puzzle piece together, I was like, I need to just better understand again, who invest in what at what stage and what sector because I recognize that the more I could have a data driven way to have a blueprint of the venture community, the more successful I could be in terms of just knowing who to share deal flow from and knowing who to collaborate with. Fast forward to six years, what started as a dozen of us, and a spreadsheet has now become the world’s largest community for women investors, we now have over 3200 women investors across more than almost 2000 venture funds, and over 180 cities in over 60 countries globally. And so what happened is, that spreadsheet started to that a woman from Boston would join, then a woman from LA would join, then a woman from San Francisco would join. And we really just recognized that there was this urgency to connect and collaborate. And again, just put the puzzle pieces together and venture. And so it really has become, for us at Hannah Grey, also just a blueprint for how we think about data informed communities and really connecting with intentions. And that’s something that you know, we help founders with, it’s become something that we’re really passionate about as a new acquisition. And so women in VC is is just a phenomenal example of, we were we were basically COVID ready, but this virtual community, and then when, when we migrated that Google Doc over to Airtable about two years ago now, that’s really when it was just crystallized this vision of big a really powerful tool to help cut data around the venture community to number one be really helpful to founders. Number two be helpful to us as fund managers as we think about who doesn’t make sense to bring into around or to find follow on capital with or to find a lead or to get smarter about a sector to get smarter about a particular market. So our Slack group now has over 100,000 messages, over 100 active channels. And there’s just dozens and dozens of virtual meetups educational webinar, there’s investment opportunities being shared, there’s resources being shared. And so we really recognize that, yes, we need to recruit more women into venture. But we also need to keep the women we have in venture. And that’s particularly important for women that are outside of the coasts. So just to give you some context, about 63% of our community is US based and about a third of them are outside of New York, Boston and San Francisco. So we’re in over 75 US cities, 36 US states. And it’s incredible, because we’ll hear from these women, we actually just got our first woman from Oklahoma City this morning, which I was like so freakin cool. But it’s kind of the point where we constantly will hear from women that they’re the only one in their firm. They’re one the only ones in their local community. We’re the only ones in the local region. And so this just makes them feel a part of something bigger and really gives them the tools and connections to succeed when tech and VC and entrepreneurship is just becoming increasingly decentralized outside of the coasts. So we’re thrilled that, you know, we’ve just, we’ve been building this for six years now. And it really sits at the center of how to create meaningful connections for women in the venture capital community.

Jay Clouse 34:48
How do you and Sutian managed to not make this a full time community management role for the two of you because that sounds like an enormous community with a lot going on. Plus moderation that can be done, I’m sure. How did you put bounds on that to let it thrive but not slow you guys down?

Jessica Peltz-Zatulove 35:06
Yeah, great question, something we’ve thought about a lot. So it’s actually a pretty well oiled machine right now. So we go in once a week and we approve all the new submissions, you can sign up on our website, women-vc.com. So we get about 20 to 30 new submissions a week. So we qualify every single one, you have to be full time and a check writing institution, you have to have a fun email address, to basically take an hour a week to run through and send an onboarding email, welcome them into the community. And then from there, we recruited over 100 channel moderators. And these are women from literally around the world that again, we we think of women in VC as as a canvas as an open source community. And as a canvas. If you want to learn about something, if you want to interview someone, if you want to write about something if you want to meet more people, like we’re just the central tools and infrastructure to help you do that. We have a couple events that we plan, you know, we’ll do like a monthly mingle, where it’s just like you just come we put people in breakout rooms, no big deal. But yeah, it absolutely could become a full time job. But I’m obviously running Hannah Grey. Sutiana is running her own respective fund. And so we see this as something just supercharges our firms and it’s also just a nice thought leadership halo effect around diversity. But ultimately, the community has been able to run itself because we really empowered our members to use our platform as a canvas to connect. So that’s really how we think about it.

Jay Clouse 36:33
Your name is Jessica, your partner’s name is Kate, where does the name Hannah Grey come from?

Jessica Peltz-Zatulove 36:38
So Hannah Grey is named after our daughters. We both have. They’re three years old, they’re six months apart. My daughter is Rhea Hanna. Her daughter is Donnason Grey . They’re FaceTime buddies. And it’s just something that you know, me coming from the brand world that my partner Kate actually started her career as Chief of Staff for Martha Stewart. So she’s kind of always been next to the entrepreneur after that, you know, she worked with Ken Lerer at that as employee 20 of the Huffington Post and then started Blair media ventures, which is now Larry Hippo. So she did three funds 200 investments with them so and wrote early checks into some of the most iconic brands Venmo, Billy Warby, Parker, Casper, Birchbox, Baublebar,Barkbox. So we just both have a very deep appreciation for brand building, we also wanted something that was really differentiated as a venture firm in the coming decade. It’s wide open from a trademark perspective. And we also just recognize that we’re role models not just to our girls, but to people everywhere that this is a new normal, you can have a great career and balance a family and that should be talked about. And it also i we’ve found really helped us connect with entrepreneurs. Because venture is a very human business. We are working with these people for for 6, 8, 10 years. And you know, we’ve had founders get divorced, we’ve had founders have babies, we’ve had founders have parents pass away. And so there is this human connection that you want to understand and have relationships with them. And every part because it just it can, it can impact their focus or on building a business and you want to be that trusted partner. And so we wanted to do something that was personal and meaningful to us. That sounds way better than that. You’ll have Beardsley Ventures that is just that just does not roll off the tongue. But then it’s also just, you know, it’s not a power word. It’s not a street name, it’s not a tree. And so Hannah Grey, there’s, there’s been a little bit of this, like, we get called Hannah a lot, which is weird. There’s an assumption we only invest in female founders, we do not we invest in all founders, regardless of gender, or ethnicity. But we’re here to create generational wealth, which is something that I think resonates with a lot of entrepreneurs and a lot of our investors too. So there’s a lot of different conventions and layers that have gone into the brand that we’re creating with Hannah Grey.

Jay Clouse 38:51
We’ve had Kate on the show, and she has a wealth of experience investing just as you as you shared, and you have this experience of the corporate VC and all the background you just laid out for us as well. Seems like you could have picked a lot of different directions for Hannah Grey. So how did you determine what it is that you guys are interested in supporting through Hannah Grey?

Jessica Peltz 39:10
So so Kate, like you mentioned, there’s just nobody better than Kate like, I just don’t, you are not going to find a more thoughtful fund manager with just the experience and acumen that she has in terms of just the depth of companies that she’s dealt with. And she’s just a wonderful person to work with. Someone when we’re working with Hannah Grey, we really think of our firm as the product of what did we learn working with hundreds of early stage founders over the past decade and take those learnings across five venture funds to really think about what does an early stage selection lens look like for the coming decade. And what we really recognize at the at the pre seed stage is you have to be the one to set the trends. It’s very easy to be sector focused when your series A or Series B like things are big. But when you’re at the preceded, particularly in this moment that we’re in right now with COVID, it’s really more about being a student and understanding how changes in human behavior and consumer behavior and worker behavior create outsize areas of opportunity. And so that’s why we like to say we’re generalists, but thesis driven, because we really believe that there’s so many of these forcing functions happening right now, both from a societal shift standpoint, and a cultural standpoint, down from just behavior changes of the ways that people are living and working, that we really believe are what is going to change and create big opportunities and big companies in the coming decade like we are in a, we were just coming out of a moment of crisis, out of moments of crisis really become chaos, and out of chaos really becomes new habits of behavior in terms of the way you do things in terms of the products that you align with the services, you align with the brands that you want to work with. Because when we’re in these times of uncertainty, we just really understand that all bets are off in terms of brand loyalty. And these moments in time now are really about understanding what is going to be more convenient, what’s gonna be more values aligned, what’s going to be more inclusive, what’s going to be faster, what’s going to be more accessible. And so given this period that we’re in right now, and all this creative creation, we like to say we’re thesis driven, because it’s really around. How do you expand availability for overlooked audiences? So much of technology that has been built historically is for the coasts. And so how do you really broaden access to things like education, like financial inclusion, like wellness, like health care, and so we’re really interested in technology enabled solutions that are just expanding access to goods, services, products and opportunities that can improve quality of life. information. urgency is another thing that we’re really focused on. There’s so many industries that are still very disconnected in terms of how their data and how their services are displayed. So how can we use technology to better streamline that experience for the end customer? That’s why we love these b2b, b2c businesses, because it’s really okay. What are the changes in consumer behavior and worker behavior that is driving adoption for this platform? That’s why things like Zoom are so successful. That’s why things like Slack are so successful. So it’s again, what are the changes in behavior at that end, customer side that will create big businesses. And then the third thing that we’re really focusing on is community driven commerce. So that’s not just you know, Kate, again, she’s she’s been at the ground floor of some of the most iconic brands of this decade, this past decade with Warby Parker and Casper and Birchbox. She’s first semester in Billy, I was early in Lively. And so we really understand what these early signals of success are. So it’s really about how do you create a brand that is identity driven, that creates a sense of belonging that inspires you to participate in the community. And that’s why, you know, we really believe that education and community are the new acquisition. It’s not about paid social, oh, it’s horrible. It just it masks true customer love. But then also another dimension of that as, as the influencer space has transitioned and morphed into the creator economy, you know, what are new tools and infrastructure that are going to support them that as they’re arguably the new small business, and I think that what we’re also seeing of this migration into the creative economy is very interesting, because, you know, the gig economy was sort of all the rage but the gig economy was really focused on transferable like non skilled labor right? Can you drive a car can you run an errand? Can you deliver a package but the creator economy and this transition we’re seeing from the influencer community, in the influencer space into the creator economy is more about how do you monetize yourself and your creations as a way to potentially cannibalize brands or become the new brands. When you already have a built in audience you already have trust and authenticity with your base. So those are some of the themes that we’re excited about. But it really transitions into sectors like commerce, FinTech, future of work, wellness, education, marketplaces, and SaaS.

Eric Hornung 44:13
When you’re thinking about these trends, how early Do you want to hop on a trend? So like now we call it the creator economy or the passion economy because someone wrote a piece and dubbed it that but 10 years ago, the inklings of this new habit were being formed and being started. So would it have been like, how do you think about I see this trend coming down the road versus this trend is here and people recognize it as a trend now we can invest in it?

Jessica Peltz 44:39
Yeah. So I think something like to creator economy I will so I think two things about that. So number one, the creator economy is really fascinating to me, because I lived through the evolution of the influencer rage I must have talked to at least 60 or 70 different companies and I think there’s some clear breakouts, couple of them that are good friends. to aspire IQ, they’re phenomenal. But it’s also why I think it’s interesting is where the influencer space started. It started as people with large followings that would look for brand partnerships that the brands would leverage them to create content for them, that would maybe do an affiliate program for them. Or they would just syndicate some of the brand’s content to reach their new audiences. And the transition that we’re seeing now is, these creators are like, I don’t need you don’t need to create content for your brand. Like I actually have a brand myself. And so I think it’s this really interesting shift in this mindset, where I think COVID has absolutely been a forcing function for a lot of these people. And that’s why we’re really interested in infrastructure in the space is because they’re recognizing that they are able to cannibalize the brand loyalty and the trial for brands that they had previously been partnering with. I’m not saying that’s not still going to be important. But now you’re seeing the influencers start to have more tools available for them to monetize their day. I mean, we’ve seen some things where it’s like, should I wear the red shirt or blue shirt, like they’re just monetizing every single piece of their day, which is also different from something like XC, which is arguably like almost one of the these first springboards for that, because now it’s more about, is this an NFT that I can sell digitally? Is this again, something like choose your own adventure of the day? Is this a cameo or it’s like, I’ll do something for you, I’ll leave a comment, I’ll do a birthday video, whatever it is, like, they’re finding so much more creativity on how to monetize themselves and their lives as as a talented individual, as opposed to like I said, it’s a difference from the gig economy where it was more about like, what is that transferable skill you have. So that’s why I’d say like the evolution that was really important in terms of the PC row, and I’m assuming that you’re talking about Lee from Atlanta, was frickin brilliant and phenomenal. And she was actually in the an operator cohort with me last summer. She’s a huge thought leader in this space, I have so much respect for what she’s doing. I definitely feel like I’ve learned a ton from her. And it’s crystallized a lot of my thinking in terms of just seeing this change that I had been following since 2011. influencers in terms of timing of is this a trend? I think the big thing for me, and having lived through that the the VR all the rage? Is Is this solving a real problem? And is this? Is this something that is like manufactured hype and demand from some big thought leaders that are probably based on the coast? Is this solving a real problem for the customer? And this is why everything we do at Hannah Grey revolves around understanding what are the forcing functions, the cultural shifts, the societal shifts that are driving this trend, to make it a lasting business. So something like the creative economy, you know, really was born out of a lot of these people were laid off, or their business was on paused, or they had a partner that was laid off or their spouse was laid off. And so it, it’s emerging out of more this urgency based on the societal shifts that are happening, that we’re just really excited about what that means for the coming decade, when you have this kind of intersection of what just happened with COVID, around just this death of the old economy, coupled with new technology and infrastructure that’s enabling this trend, coupled with just the creativity that’s happening with millennials and Gen Z in terms of how they think about work, and how they think about the type of job that will enable them to live their life and be who they want to be.

Jay Clouse 48:39
You said that Hannah Grey is a pre Seed Fund, right?

Jessica Peltz-Zatulove 48:42
Yes.

Jay Clouse 48:43
And so if you are investing in founders, and you’re trying to figure out what are the cultural things that are happening as forcing functions, that’s one lens you have to look at to see like, Is there a problem here? But that early on, the founders often don’t have a whole lot to show yet, either? So how do you guys think about that level of risk? Or why did you decide to take that level of risk with this fund, given the pedigrees that you both have?

Jessica Peltz 49:07
Yeah, so we we love working with pre seed founders, like we love understanding, how do they see the world? What problems are they do they need to solve? Why do they need to solve it? There’s a lot of I feel like psychology that goes into understanding the DNA and having a really your finger on the pulse at the early stage is because it is often about why do you want to solve this edge and then help us understand why a lot of people need to solve this edge and what is that market potential and What experience do you have that is shaping your vision on the world and what connections do you have that will enable you to succeed whether that’s around customers, whether that’s around partnerships, whether that’s your own employees and talent, you know, what is that that view that you have that is unexpected and contrarian, but it’s something that other people are thinking And it’s bubbling up under the surface. And so when you start to learn about people’s childhoods from their past how they live in their community, and that’s really something that just really motivates us is because our bread and butter is helping to turn those ideas into your first call it 25, 30 employees in your first 3 to 5 million in revenue like, that is where we play, we are not the right fund to help you go from 10 million to 50 million in revenue. We are not the right fund to help you scale internationally. That’s just not what we do. We’re really about how do you start to build loyal fanatic fan bases, your first 100, 1000, 5000 customers, and again, this is this is also taking a lot of the playbook of how we’ve made women and VC so successful is because we really believe that you have to be building community to create that sense of belonging, to create that customer love that is really organic. And that inspires that sense of belonging that your customers want to interact with you in various capacities. And so we love working with early stage founders, because it’s just, again, it doesn’t matter whether it’s HR professionals, or whether it’s soccer moms, like it just doesn’t matter. It’s like how do you build something that is solving a problem for them, and then help us understand how big of a problem this is based on how many people you’re targeting, that are feeling the same way that have the same pain point. And so that creativity is just something that like energizes us, we’re excited about it, you just it’s the best job in the world, because you get to just learn something new every day. Because we believe, again, precision investors have to set the trends. And it’s really about just it starts with the behavior of the worker and the behavior of the consumer to identify those opportunities. Because so often when we see founders that are just in love with their products are in love with their design, and it’s like, okay, but why is it solving a need for the customer, like, talk to me about your customer service? Talk to me about how you’re building this for that and talk to me about why you’re obsessed with solving for that group of people and how it’s going to improve, how they work, how they live, things like that. So yeah, it’s just like the most exciting place to be especially now like there’s so much creative creation coming out coming out of this period like, these are moments that early stage investors wait for looking at the silver lining is because this is like a moment where there’s so many disconnects in terms of what are the inefficiencies what are the breakdowns in our system that had been exposed that entrepreneurs are just like itching to solve and to do better. And so for us it had a gray like, it is a perfect time for us to be deploying capital because we want to be solving those problems that when we come out of the chaos, when we come out of this period, we know that behaviors and habits are going to be retargeted. And those are the companies that we’re looking to capture.

Eric Hornung 52:48
Jessica, this has been awesome. If people want to find out more about you, or Hannah Grey, or Women in VC, where should they go.

Jessica Peltz 52:57
So if you want to share your business, we’d love to hear from you. You can go on our website hannahgrey.com. hannahgrey.com, we have a forum, which is something that, again, we believe we want to hear from everyone. We don’t care about warm introductions, we don’t care where you’re based, that is just not an elitist mentality that belongs at our firm. So anybody can go online and submit their business. And we will respond to every single one to see if it’s a fit. Or if you want to continue the conversation. You can always find me on Twitter @JessicaPeltz. And Women in VC is at women-vc.com. We have some handy stats in there about our community. And if you are a woman investor, again, we require everybody to be full time and a check running institution. So that’s institutional funds, corporate funds, impact funds, accelerator funds, family offices that do direct, but we do have it all gated for a membership to just keep the integrity of the community. But love what you guys are doing and excited to support in funnel more more people your way.

Jay Clouse 54:02
Eric, the Upside Podcast Network is growing.

Eric Hornung 54:05
We’re growing, we’re adding new podcasts, we’re looking at more Jay.

Jay Clouse 54:10
We’re looking at more, we have a strong bar now set by Lay of the Land and When Pigs Fly in Cleveland and Cincinnati respectively. We would love to hear about your city though and consider launching a a new podcast on the Upside network where you’re from.

Eric Hornung 54:25
One of the best parts about launching on the Upside network is being surrounded by a group like When Pigs Fly and Lay of the Land to accelerate the development of your idea to run ideas by to learn about how to build a podcast. That’s what we’re doing here Jay

Jay Clouse 54:41
And we’d love for you to be a part of it. If you’re interested in exploring starting a podcast in your local city, you can email us network@upside.fm and let us know. We’d love to hear about you and your idea for your city. And if it’s a good fit, maybe just maybe you’ll be on the Upside network too.

Eric Hornung 55:03
All right, Jay, we just spoke with Jessica of now, finally, Hannah Grey, we got to do it.

Jay Clouse 55:09
We did it, it was as advertised. Holy moly. Jessica is an incredibly articulate and thoughtful person. Not that I didn’t expect that. You just only get so much of somebody in email. And then here on the fly, I was just like, Wow, she’s got all these statistics upper sleeve. She knows all this stuff off the top of her head. It was a really impressive interview.

Eric Hornung 55:31
There is something about aggregation and directories that I just love, easily searchable, aggregated directories, we built one with our friends over at Visible, which you can go check out at connect.visible.vc, which is aggregating investors across the United States, and now the world. But when we were talking to Jessica, off mic, she was able to pull up this directory and just say, Oh, yeah, I know someone here. And here’s who I knew there. And here’s how I know that. And I just love the power that comes with a well curated well manicured directory.

Jay Clouse 56:06
Totally. And that directory is so impressive with 3200 investors, 2000 venture funds, 180 cities, 60 countries, that is a powerful, powerful directory. And now moving into Hannah Grey, what an incredible network to build in to be connected into as you starting to source these very early stage cutting edge companies with her partner, Kate.

Eric Hornung 56:33
And you know that a directory is not just a database, when we have been introduced through I think three or four different separate people to Jessica. So it’s not just a directory, it’s not just a database, it is very much a community that happens to have a data component to it, which is probably the ultimate form of what you want to build if you are building a community.

Jay Clouse 56:55
That’s true. We mentioned in the intro that Jessica introduced us to several people on the show. But also, when we’re asking other people on the show or in her inbox, Who should we talk to their constant saying, Well, why we had Jessica on the show yet. So she’s she’s definitely built a community around here. And I’m glad we got to spend a little bit of time talking about what that looks like for her as the community curator. Because that size of a community who all operate in such a fast paced world could become so overwhelming, I feel so to see even the fact that she’s she’s essentially an extremely adept community manager in a sense of the word manager in the world of community. But she’s extremely adept at that. And that’s not even what she’s doing. That’s just a byproduct of this passion project that she’s doing on the side. So it really, really speaks to Jessica’s ability to prioritize and delegate and make things real. And one of the things being Hannah Grey, I’m excited to see the types of companies that she and Kate are investing in, you know, she listed off some of the companies that Kate has invested in her pedigree with, with Billy and in early stage, consumer products like that. I’m sure whatever they find and start investing in, we’re going to be saying, Wow, those are good bets.

Eric Hornung 58:09
When we look at community, now it’s 3200. They have this directory, it’s data driven, they have events all the time, we’re looking at a cross section of the community that exists significantly later than when it was started. I think back to just getting it started and rolling that momentum with, I believe she said 12 people on a rooftop bar in New York. And I wonder how many of those meetings we’re not having across the country? Just because it’s so hard to go from zero to one?

Jay Clouse 58:35
Yeah. That’s a good question.

Eric Hornung 58:38
And I think about that, specifically, in context of what we’re launching here at upside. We have pod Lay of the Land up in Cleveland, we have When Pigs Fly, and we’re not doing events. So maybe I should be taking a little bit of a prodding, we should be taking a little bit of a prodding from those to that first meeting of 12 people. And I’m trying to selfish for a second here, Jay, we should be launching stuff like this in Cleveland and Cincinnati.

Jay Clouse 59:00
Yeah, we should. I have no excuse. I have nothing to add.

Eric Hornung 59:06
I finally silenced him everyone.

Jay Clouse 59:08
Something that Jessica highlighted. Were a few trends that she’s seeing that I wanted to call out to the audience here because I think these are really on the money. convenience. These are trends in like brands that people are interested in. convenience, values aligned, fast, accessible, inclusive, community driven commerce. These are definitely trends that we’re seeing right now. And if you’re out there thinking about the types of companies that you’re meeting now and starting to find out about starting to invest your time and attention and even dollars into chances are they’re probably convenient values aligned fast, accessible, and inclusive, if those are things that you value.

Eric Hornung 59:45
And if you have any of those companies and you want to introduce them to us here on Upside, we’re always looking for great pre series A companies that are building outside of the coasts, you can send us introductions without double opt ins to hello@upside.fm And we would love to add them to our pipeline.

Jay Clouse 1:00:02
Thanks for listening. I will talk to you next week. That’s all for this week. Thanks for listening. We’d love to hear what you think about this episode so tweet at us @UpsideFM or email us Hello@upside.FM and let us know. You can learn more about us and browse our entire back catalogue of episodes at Upside.fm. And if you love our show, please leave a review on Apple podcast that goes a long way in helping us bring high quality guests to the show.