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Video interview with Catharine Merigold, Founder & General Partner Vista Ventures. Catharine has worked with communications and information technology companies for twenty years, as an investor, as a board member and advisor, and as an entrepreneur. She started her venture career in 1992 with Centennial Ventures, the largest venture firm in the Rocky Mountain region. She was the founding CEO of a venture-backed company, a vice president at a Fortune 100 telecommunications company, and CEO of UTC, the company that manages all the technology developed at the four University of Colorado campuses. Catharine received her BS in Electrical Engineering from Washington University in St. Louis and an MBA from Stanford University. You can find Catharine on Twitter @CatharineinCO
Transcript follows & video above. This is Part I of the interview.
- Which themes do you like to invest, what is your sweet spot?
I think I want to start with a little bit more background. I started in venture in 1992 which means I’ve been through quite a few cycles, economic cycles & venture cycles. I founded Vista Ventures in 2000. I’m excited because I got an email this morning & we were just named as one of the top 100 vc firms. So I had to start with that because we’re very proud of that. was a very, very difficult vintage year for venture funds. Vista was started with some common values & ideas about what venture should look like. Part of it was during the first internet bubble, a lot of people got into venture only because it was about making money as compared to being about the entrepreneurs. When I started Vista, everyone at Vista has had senior level operating roles. We understand what the entrepreneur goes through. I’m not saying that’s the only model but I believe that that’s important. To understand entrepreneurs you can be better in selecting & be better in helping. Vista invests in IT broadly. But more specifically we look at 3 converging or synergistic or almost co-dependent sectors of networks, software & digital media. The reasons I say that they’re co-dependent is that if you had had an opportunity to invest in youtube in 2000 it would have been a bad investment because there were not networks to support it. In order to understand what goes on in the contents space or the software space, knowing what’s going on now in mobile networks & bandwidth & who’s in power they’re all related. You can’t have content without networks. Likewise now that the content has increased it’s making influence on what people are doing on networks. So we see those 3 as influencing each other.
It’s a very interesting combination.
Again it’s IT generally but having expertise each of us came out of one of those 3 sectors. And it’s useful to have the different perspective when you’re making investments in anything seriously.
Yeah, yeah it definitely would add value
- What do you look for in women entrepreneurs & startups that indicate interest to you in investing in their businesses?
So I have to say I don’t look for something different in women or any minority entrepreneurs. We look for the same things in entrepreneurs. I guess I’m going to have to veer a little bit here because one of the questions people always ask is why don’t more women entrepreneurs get funded or why don’t minorities? And I want to start with the basic precept about human behavior. Humans when they need to make a decision that is about the future, that has some risk to it, in general, subconsciously whatever they go to things that are more known to them. This is why in the beginning it was harder for women to get promotions for women doctors. When you have to make a decision if there was something different about the person that seemed a bit unknown to you, you didn’t know necessarily how they would react in a certain situation. People go to their comfort zone. This is not necessarily about discrimination. It’s just an inherent thing that we do. Somehow someone that’s like us, we believe we know how they may act or it just feels less risky. So I think that’s part of what goes on. It’s a learned thing, women doctors are much more accepted. But in the beginning people might have felt uncomfortable with that because it was such a new thing. And new & risk making decisions! Now when you talk about vcs funding, you’re not only talking about them taking risk but they’re investing other people’s money & they’re starting a long term relationship & they have a responsibility. Again I don’t think it’s overt discrimination, I think that they’re trying to make decisions about the future & there’s a risk profile in there. Inherently they may see differences if they haven’t worked with or haven’t seen a lot of women entrepreneurs, it’s somewhat more of an unknown quantity to them. There are things that women do differently that may amplify that feeling of differentness.
You had a question that is looking for venture money like dating. In some ways it is but it is dating leading to marriage because you’re going to be making the concept is a long term relationship that you know is going to be difficult. And so when women ask me how do I get venture? I guess I’m moving around but? It is like dating, but like dating if you’re really looking for marriage you have to be yourself, you can’t be somebody else. That said there are ways to present yourself that are still true to you. So I’m going to use the dating analogy. Let’s say you’re kinda like the character in Sex & the City. You’re all fashion forward & love cities etc, Should you start dating a guy who really only likes to backpack & be outdoors? And should you go to that date wearing jeans etc because you want to be like him when that’s not who you are? Well that’s not going to work long term. That said if you’re a person that likes that fashion forward kind of style but you’re also an outdoors person, when you go that first date what should you wear? You should probably wear something that first of all relates to that audience (being that guy which is I like to be outdoors etc) even though both sides are true of you. So you have to think about that. So when women are pitching to venture capitalists or any kind of men, there are subtleties about our verbal behavior, what you wear, how you act. Again venture capitalists are taking a risk, they want somebody that’s confident & a certain amount of power as a leader. And there are subtle cues that convey that or not convey that. There’s some great research. I just went to a seminar last night on Women on Boards. Professor Deborah Gruenfeld at Stanford University http://faculty-gsb.stanford.edu/gruenfeld/index.html is doing some great research on the subtleties on how power is & isn’t communicated. Now how power isn’t communicated is fast movements & touching your face & higher voice & too much stipulation versus more of an open stance, low & slow. Now again you have to be enthusiastic, you have to be yourself but you can choose to be yourself in more powerful ways. Because that’s going to matter. I had this woman entrepreneur that I was helping & bless her heart she had very, very long blue fingernails. As she was doing her powerpoint & hitting the keyboard with these very long blue finger nails, I found them even as a woman very distracting. I said to her you can choose whatever you want to do with this information but realize if that is not important to who you are then it may be getting in the way of you communicating in a way that they feel like ‘Oh yeah I know how this entrepreneur may respond to things.’ So it’s not overt discrimination. It’s how do people perceive confidence? Is this person wanting to take a risk? Do they want to build something big enough? So it’s the subtleties, not just gosh I need to date, it doesn’t mean if I’m going to a Bay Area VC & Cathy is in a blue shirt, to look like that. That’s not it. It’s about being you but being aware of how you come across to that audience.
So how can you make them comfortable, but still remaining authentic within your own integrity as well?
It turns out you will not make them comfortable if you’re not truly being yourself. People pick up on that even if you’re not aware of it.
Yes, yes it really changes the dimension, doesn’t it?
Be yourself but give yourself more flexibility in your behavior, in your dress, in how you do things & think about it from the perspective of the audience.
And the thing that I would advice clients in coaching around relationships is that it’s always better to look at someone’s actions than their speak. In fact you’ll get more out of that. I guess in a way it somehow correlates with what you’ve just said you can still be authentic about yourself but you might make yourself appear to be much more in line with their comfort zone, which is not changing your outer integrity. They can still see how you’re going to act if they ask certain questions. Very good, thankyou.
Do realize that again because they may have less experience with women entrepreneurs (a lot of these things are learned) (Again it’s not that they think women are less capable) it’s just they have less data! And that feels like more risk because there are going to be hard times in your startup! It’s not a maybe, it’s a given!