Eve Phillips: Woman’s View of Both Sides of the Table

Transcript follows & video below. This is Part I of the interview. You can view Part II here

Could you tell me briefly about your past history in sourcing venture capital?

Sure, Empower is the 2nd startup that I’ve co-founded, although I was involved with several other startups before that. I’ve worked in venture capital & private equity as well prior to starting these companies. The company before this one, a company called Chirp, actually was seed funded by the venture firm that I worked for just prior to founding Chirp which was great from an ease of financing standpoint. Probably in retrospect not the best thing for the company because it gave us, I think a sense that we probably solved more of the problems & the key risk factors in the company before we had actually done so.

Eve Phillips

So creating kind of a bubble?

Very small & it was still just a seed round. But in our own minds we probably ramped up from a cost standpoint too quickly. And later found out that our customer acquisitions strategy & our relative strategy just wasn’t working. And so when we didn’t have enough traction we ended up just shutting it down, finding a home for the team & some of the assets. So it was an exciting but somewhat rough ride.

Eve Phillips

Painful? I can empathize with that.

Yeah but we definitely learnt a lot of lessons out of doing it.

Eve Phillips

And having your feet in both worlds, that must be just amazing really? What an experience.

It definitely helps provide an experience of what’s going on on the other side of the table. I haven’t always been able to figure out how to use that to change what’s going on on the other side of the table as an entrepreneur. But it definitely helps with what different communications or lack of communication back from an investor means, when you’re going through the process.

Eve Phillips

What personal lessons being a woman have you taken out of your successes &/or failures in that regard?  Because you’re in a fascinating setup having your feet in both worlds & also you’re a woman, so you’re sort of like a heroine for a lot of us in that way?

I hope to have some more success to be worthy of that kind of description. A lot of the advice I think is the same for both genders. And one of the biggest things is just having a thick skin through the fund raising process. In general just being part of a founding team of a startup. I think that’s particularly important for women. If you go back & look at how boys & girls grow up. Boys are more likely to play sports, do things where you have to keep going out & failing but trying again. I don’t think women are any less good at that, but we may have had less experience doing it. So just recognizing that it takes a lot of ‘nos’ till you get a ‘yes’ in almost any sales cycle so once you get lucky things happen quickly. But that you going to have to keep taking this feedback & figuring out if it’s relevant. Sometimes its good feedback & sometimes its not & incorporating that into your thinking & your process. Whether it’s specifically to your pitch or more broadly into the way that you’re running your business. Take this whole thing as a learning experience & in a lot of cases don’t take things too personally!

Eve Phillips

What attitudes towards you being female have you noted from venture capitalists when you have been sourcing venture? And I guess I could add & when you’re sitting on the other side of the table as well?

I think you walk in with a little bit of a credibility gap. And I think that really just comes from: anyone that walks in that doesn’t look like everybody else that just walked in, faces this. So its not always a gender thing etc. etc. That being said I think in most cases of people that I’ve talked to, its very surmountable. So coming in with having a technical background, that absolutely helps, good schools, the right kinds of networks, knowing people in common, all those pieces can help you get over that gap. And then hopefully get far beyond it to the point where they’re interested in working with you? I would say the flip side of being female is that you’re more likely to be remembered. That’s the flip side of anything that makes you look different is that you stand out a bit more for sure & if you can use that to your advantage then potentially that can end up working?

Eve Phillips

It’s a bit like my name, everyone remembers it after I do that ‘memo with a P’. And of course you have to be credible & have a good service or business to offer as well?

That’s always the case, absolutely! It’s also a personal relationship that you’re building with the person on the other side of the table. The investor & CEO relationship is one where you are likely to be together for several years. It’s not just sending information back & forth kind of thing. You’re both going to learn more from the process if you know how to communicate together & can share constructive feedback or criticism in both directions being able to share back & forth. Being able to share bad news & celebrate good news. These things all work much better when you can build that connection with the other person. That’s why I think, being female, showing that other person that you can build that same kind of relationship even though that person probably has fewer business relationships with people like with you, you just have to get them over that hurdle.

Eve Phillips

That’s a good point that you’ve brought up, & if we’re going to generalize women are much better at relating per se. So we could actually leverage that strength to really build & work on the relationship with the venture capitalist that we’re either pitching to or who has funded us.

I think so, I think you have to be careful about leading with that.

Eve Phillips

Oh ok could we use that as a confidence builder?

There’s a great study that my Mom sent me: where the happiness & satisfaction in life was not necessarily related to the number of friends you have male or female, but to do with the number of female friends that you have. So for both men & women, women are much better friends to have. This is of course jumping to conclusions from the study the number of female relationships you had was a big indicator of how comfortable & how much satisfaction you felt with your life.  So I think there is something about that but it also has to be a business relationship being able to share, go through tough situations & discuss hard decisions & being able to execute on those.

Eve Phillips

So having some real relationship skills & not just relating per se?

Yeah & I think both are key!

Eve Phillips

Fantastic, that’s really great advice. What qualities do you think women entrepreneurs need specifically for sourcing venture?

Again I think this is one where its really similar regardless of your gender. I think obviously having a good business idea is a good part of it, going after a big market, building a great team. You don’t have to have found everyone you need but finding a couple of people who are absolutely amazing for whatever it is you are trying to build, to support you in building that business is super important. And then yes, being able to communicate the opportunity that you see in language that an investor understands. Because they tend to have their own language & their own terminology. And that varies by sector & by type of investor as I’m learning. But understanding that & being able to translate that, because the story that you have to tell your customers may be very different than the story that you have to tell your investors, even though you’re describing essentially the same thing.

Eve Phillips

Yes that’s a really good point! In your opinion what percentage of women would qualify then as regards having these qualities? Could they be developed? If so what are your ideas about how this could happen?

This might touch on a bunch of other issues, I think, that kind of play into this. Well what I don’t know is that there are fewer women pitching & the same number getting funded as men. It’s just that there are far fewer going into the funnel to begin with. I think that’s certainly part of it. I don’t know that that accounts for everything? And then your question becomes why are so few women actually starting companies? I would certainly say from the venture experiences that I’ve had that there are a lot fewer women pitching. So maybe about the same number of them get funded. But then how do we increase that number because I think there is a missed opportunity here. I think there’s a couple things at play here. Especially in the consumer internet the average entrepreneurs range from right out of college to maybe 10 or 15 years past that. This is something that I’ve been thinking about a little bit. My current startup is in mental health services so I actually read a lot of psychology, a lot of cognitive science & fascinated by evolutionary biology. When you look at that & how that factors in to the basic demographics of those who might start companies. When you look at the audience right out of college, I actually don’t think that’s a great time to start companies. Obviously some marvelous exceptions exist for people who’ve started companies right out of college & built them into something big. I know of a lot more stories for folks who it was an amazing experience but didn’t bring them a lot of success & they were mostly male. And I think that’s because, going back to evolutionary biology, men are generally more willing to take risks.

Now is that something that you actually want as an investor looking at an entrepreneur? I don’t know? I think you want someone who knows how to calculate risk really well. So I don’t think that having someone who’s a big risk taker as an entrepreneur is really necessarily what you want. But if you look at who’s starting companies from ages 20 to 25, its mostly men. Because I think they’re less afraid of what they don’t know. And so suddenly you’ve got a lot of people who are willing to just jump on. But then I think as you get a little bit older late 20’s to early 30’s is a probably great time to start companies. This is prior to having a family & other obligations but you’ve got some work experience to actually to put into work. Now you’re in a position to potentially see interesting opportunities in markets & such.

And then you’ve got the obvious logistics if you’re a female & you want to have children this kind of cuts into that prime time. That’s really hard whether you’re trying to be an entrepreneur, a lawyer or a partner in a law firm or any kind of role where you’re on that time line where period is so important. So I think that’s why probably there are fewer women & that’s potentially filling the feeder in that demographic. And then I would imagine, I don’t know, it would be great to see if it kind of evens out after that, when some of those early factors may not play into it quite as much. I don’t know that it does? But I think there’s a mix of risk factor & unfortunately just timing problems come into play. So with women it’s just that logistical problem. But I’ve met some phenomenal women at all stages of their careers. I’ve been very lucky to get helped & mentored by some of them. I am trying to think of what solutions to the problem might you look at. One might be looking less at the age, looking less if time had to be taken, making it more ok that this period of having kids is going to get in the way.

Eve Phillips

It’s going to eliminate a few women?

Yeah & I don’t think that takes away from people’s drive or ambition. It’s just a logistical process there that you’ve got to somehow find a way to deal with. For younger entrepreneurs, assuming that you want more entrepreneurs of that younger skew, then perhaps its more about encouraging more women at the university level. Probably getting more women into sciences where most of these companies are starting out of, computer science & things like that potentially.

Eve Phillips

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