In episode 77 of Pit Stops to Podium, we sit down with Minnie Ingersoll, Partner at TenOneTen Ventures and host of the LA Venture Podcast. In this episode, we will dive into key topics that shape the world of venture capital and startup success. Minnie will share her insights on the art of decision making when it comes to capital, the significance of fostering a thriving team culture, and provide valuable entrepreneurial advice for building strong teams, raising capital, and navigating the challenges faced by startups.
Get ready to explore the decision-making process surrounding capital in the startup ecosystem. Minnie Ingersoll will shed light on when and how to make strategic choices regarding funding, weighing the benefits and risks associated with various capital sources. Additionally, we will delve into the critical role of team culture and effective communication in driving startup success. Minnie will share her expertise in building teams that thrive, fostering collaboration, and creating an environment conducive to innovation.
If you’re ready to learn from one of the best, then buckle up and hold on!
Short answer: when you need to and have to.
Longer answer: If you want to build a billion dollar business, then you need raise venture capital. There is a trade-off in that gaining capital will result in you giving up about 20% of the company in each round. This is worth it if you are more interested in owning a small percentage of a gigantic, world-changing company, as opposed to owning 100% of a small company. It's very much related to personal preference.
"If you want to build a really solid business that spits off cash every year, I think that's totally legitimate, and you don't need to raise venture capital, then you shouldn't"
At the seed stage, you need to look at nailing product-market fit and maximizing learnings.
In series B capital, it's a about instrumenting your business and having the ability to scale.
"A lot of what we're helping people to do is get those learnings early because it sounds easy on paper, and it's much harder when you're running a large organization."
It helps to be on the same page when it comes to which metrics to look at, and when to be looking at them (daily, weekly, monthly), as it can help you run your business in a more repeatable, scalable way.
Communication is huge, especially when it comes to the purpose of certain meetings.
"If you walk into any company and ask them them, 'what are the top three priorities?", if you ask 20 different people, you're going to get different answers."
Podcast: https://www.tenoneten.net/podcast
LinkedIn: https://www.linkedin.com/in/mingersoll/
Brendan: Hey everyone, welcome to Pit Stops to Podium, the RevPartners podcast where we talk to execs who have competed and won in taking companies from high growth to high scale. My name is Brendan Tolleson. I serve as the co-founder and CEO of RevPartners, and I'm delighted to have with me today, Minnie Ingersoll, for this episode of Pit Stops to Podium. Welcome, Minnie.
Minnie: Thanks for having me.
Brendan: Well, we're delighted to have you. And for those that may not know who Minnie is, and I'll let you introduce yourself in just a second, but she currently serves as a partner at TenOneTen Ventures, and also a host of LA Venture Podcast, which is pretty cool. So Minnie, for those who may not know you or who TenOneTen Ventures is, I would love for you to share a little bit about the firm and how you got to the firm. So what's the origin story to starting it?
Minnie: Sure. So as you said, TenOneTen, we lead seed rounds for entrepreneurs who are usually B2B companies, technical founders, and it's kind of my dream job. And I didn't know it was my dream job. I was a founder before this. And I'll tell you a little bit about being a founder of a company called Shift. It's a used car company. But really when I finished Shift, I thought maybe I could give back a little bit to the entrepreneurial community. female founders networks. And I want to do some mentorship. And it turns out that people wanted mentorship, but they also, in a lot of cases, wanted a million dollars to go build the company. So in venture, I feel like I get to do that mentorship aspect as well as provide capital and have a lot of infrastructure and team around me. So it's much more than I was able to do when I was an angel investor. But the quick version of me is started my company, Shift, in 2013. by buying and selling cars on Craigslist was how we got going. And ended up raising multiple rounds of capital. And we were on the path to becoming a public company and sort of scaling outside of what I consider my sweet spot. I was also along the way having more children and I had the chance to exit the business, exit shift, shift then went public via SPAC, which was, still is exciting times. And I decided to move from the Bay Area to LA and look for a job and I ended up meeting up with my two partners at TenOneTen and pretty much a dream job, you know, a lot easier I think than being a founder.
Brendan: Well, that's always fun. I mean, it's, I wouldn't say unique, but it's fun to talk to folks who've experienced both sides. Sometimes when you're talking to VCs, they haven't experienced that in the seat as a founder of building. So it's always fun to have kind of that perspective. And what about the podcast? So what is LA Venture Podcast about?
Minnie: I interview a different Southern California based venture capitalist each week, get to know them, get to know what they're investing in. And when I was a founder, I found the process of fundraising sort of intimidating, especially our later rounds, you march into a full partnership. When I was doing it, it tended to be like a large white male partnership. And I found that if I listened to someone talk about their life, I got much more comfortable just knowing who they were. And so this podcast is about getting to know the people you're trying to raise money from.
Brendan: That's great, I think that's a good segue. One of the traditions at Pit Stops to Podium is to get to know our guests outside of work. You mentioned family and having children and what are some of those, I guess, the passions, hobbies, interests you have outside of the business world?
Minnie: So, right, so I had three children while doing a startup, which was busy. So it started shift when I was on maternity leave. So no better time to start a company really when you're, you know, gotten newborn. I live with my parents, so a lot of family in one house, but turns out with three kids, it's really helpful to have a lot of parental support. And I go surfing whenever I can.
Brendan: Have you, I just finished, have you ever heard of Make or Break on Apple TV? I don't know if you have Apple TV. It follow the World Surfing League. So it's one of those documentary series about the sport. And I don't surf, I live in Atlanta, Georgia. So we have no ocean and the oceans we do have, have no waves. But it's fascinating and it's just the fun stories to get the backstory of the surfers. But that's gotta be fun.
Minnie: I just went to one of the stops, the Kelly Slater Surf Ranch, which is this huge artificial wave in the middle of the desert. It was the best wave I've ever surfed. It was one of those amazing experiences. They have all the lockers from all the pro surfers and you get to go surf the same wave.
Brendan: That's sweet. And how old are your children?
Minnie: 9, 8, and 5.
Brendan: We have the exact same age of children. So that's fun. All right, well, let's transition, Minnie, a little bit into, you talked a little bit about your experience at Shift and you mentioned with TenOneTen that you have the pleasure of serving as an advisor and investing in early stage companies. And so I think, we talked about that's a unique kind of lens of having both perspectives. And for those early stage companies, as you're starting to meet with them and even talk to them on your podcast, how do you help them start to kind of navigate, if and when does it make sense for me to actually raise capital? Maybe one of those triggers that they should be mindful of that says, hey, I actually, whether it's maybe I'll take the word need it out in terms of, hey, this is like, what's a better way for them to be thinking about it versus just I have to raise money?
Minnie: Well, often that's a good, often it's when you need to and have to, to build a venture business, right? And so I think there's a real, that's the first question is just if you want to say like, I'm going to build a billion dollar business or go bust doing it. And it's not about billion dollar business. Just I want to build something huge. You often need the venture capital to just do that. I think it's, you know, if you want to build a really solid business that spits off cash every year, I think that's totally legitimate. need to raise venture capital, then you shouldn't. But I meet people all the time who are just, they're absolutely passionate. They can't put down this itch that they have to build something, and they need the capital to go and actually fulfill that. And so it comes with a trade-off. You're often giving up 20% dilution, let's say. So you're giving up 20% of the company in each round that you raise a venture capital. So it's certainly not free, but you'd rather a lot of, you know, if you have huge aspirations and ambitions, then the idea of you personally owning a much smaller percent, 10% of a huge billion dollar company that is changing the world might be more appealing than owning 100% of a really solid smaller business. And so, so I think you have to think about your own needs and like the case of shift we started, we were just parking cars outside my co-founder's house and like street come and we have to move the cars and at some point like we needed a warehouse and that required some real capital so you know you come to these inflection points where the business has grown and it just in order to get to the next level you need usually its capital
Brendan: Yeah, I think what I was thinking too is like there's a difference between playing offensive playing defense and to your point, need as it relates to accelerate or say, hey, we really do want we have a big idea and we know we need money to actually execute it versus like, hey, I hope this like, I still am holding on to this idea that's not working and just taking cash as a very different mindset or probably not very attractive for the VC either. as you mentioned, we've now injected some capital into the business. And especially, I think, May, in your kind of thinking about what you invest in, seed round, what's the advice that you give to those founders or CEOs as to once you have that capital, where does that capital go? Or how should they be thinking through the decision-making process from a team perspective?
Minnie: I think it varies a lot in what stage capital you're raising. So we're investing at the seed stage where what you're probably looking at is still really nailing product market fit at our stage. There's a lot of iterating. Whereas if you're raising series B capital, it might really be about instrumenting your business or knowing between your series A and your series B, it's having a machine, for lack of a better word, that you know if you pour more capital into, Right. So things like you can scale your sales effort, you can scale your marketing and know that you'll have positive ROI from those efforts. But usually at the seed stage, people aren't quite there. So a lot of the capital is even still at seed in a price round. It's like maximizing learnings is a big one. You know, if you go and study entrepreneurship at business school, they'll tell you to iterate, iterate constantly on your idea. And that's much harder to do when you're a larger company. So a lot of what we're helping people do is get those learnings early because it sounds easy on paper and it's much harder when you're running a large organization.
Brendan: Yeah, and I was going to ask you too, as it relates to that, the kind of learning concept of the feedback loop, I imagine there's a lot of testing going on. And so how does it work as it relates to the team culture, the communication? How do you kind of, not only with the VC, but with the team, like, how do you make sure that you have clarity and cohesion in the midst of that?
Minnie: Oh, I mean, that's a huge question, right? I think if you walk into any company and ask them, like, what are the top three priorities, and you ask 20 people at the company, you're gonna get different answers. So, for us, we had some real inflection points. One was when we really got a good FP&A person, so someone who really helped with our financial planning forecast, as opposed to sort of the more backward-looking accounting work. It really helped us to understand to look at on a daily, weekly, monthly, quarterly basis. And there's a lot of things that you don't want to be looking at at a weekly basis because it's a monthly or quarterly scale. But then there's a lot of things you need to stay on top of. And that sort of running the business really based on a lot of the insights that you can get from the data, from the financial data, from the product usage data, that sort of thing really helped us run our business of more repeatable, scalable way. But there's also just a lot of interpersonal communication. I think another inflection point was hiring an HR person who taught us a lot about how to communicate. I learned the term verbal signposting, which is where you walk into a meeting holding your verbal signpost that says, this meeting is going to be a brainstorming meeting. So bring all your ideas. Or this meeting is going to have a really tight agenda. So show up here and we're going to stay on agenda. That sort of stuff, you know, I thought I was a good communicator until I had to run a much larger organization. And I learned there's a lot of nuance and a lot of ways to improve. So that's actually one of the things we look for when founding companies, when funding companies is clear communication.
Brendan: So you said verbal signposts, right? So you would literally, well, it's nowhere like a post-COVID world, but there's still so much, but you would hold up like, hey, this is the intent of the meeting. So people have an understanding, or was it before the meeting? Like, how did you implement that?
Minnie: It wasn't an actual signpost. It was just a verbal signpost. So it wasn't actually like a sign that said like, brainstorm, brainstorm. Although I like that. It was just a saying verbally, this will be a brainstorming meeting, or saying verbally that this meeting will have a tight agenda. So it was just starting meetings, like with the metadata about the meeting, about how you want the meeting to proceed.
Brendan: Yeah, it puts everybody in the right mindset of what are we trying to achieve, and so that they are in the right mindset to actually accomplish that stated purpose. I really like that. So yeah, to your point, in Zoom, I feel like you can start doing that. You can just have a background probably that shows what the intent is for the meeting. Well, yeah, I guess the last question is I started to think through this a little bit, getting the seed round. I mean, to your point, product market fit may not be there, because you're kind of investing in the founder, right? what the idea is and supporting them to help them achieve that. So what are some of the characteristics or traits that you look for in that founder that says, hey, we have to make a, whether it's the idea or the founder, I'm sure it's a combination of the two, but what are you looking for?
Minnie: Amazingness. I mean, it's like, it really does have to be just outstanding people. And I see that over and over, outstanding people are the people who move the needle in our generation. And there's certain people who do that repeatedly in their lives. And you meet the Ev Williams or someone who Ev did blogger, and then he did Twitter, and then he did medium. And they're just these people. organizations, it's a few people who really move the organization and really are the inventor of gmail or whatever it is and So trying to find those extremely special people is one part of it and that's very qualitative but To get more quantitative. I'm looking for someone who deeply understands an industry and has a unique insight and Can communicate that insight and has the capability to actually execute on it?
Brendan: Yeah, to your point, there's the, I'll call it the X factor, but there's that qualitative aspect that you just mentioned that this, they either have it or they don't. And then I think there's the, to your point, the proven track record past companies or the relevancy that gives you the assurance that there is a roadmap to give me, there's no guarantees, but at least you have some predictable success going into that type of investment.
Minnie: Yeah, I mean, and we talk sometimes about distance traveled. So it's not necessarily that you worked at Google and went to Stanford. It's that you've done remarkable things is often a useful barometer. But it might be remarkable things, hiking huge mountains or whatever it is that is your passion and is some indication. where you started in life and things you've done, but it isn't necessarily like everyone needs to have done the exact same things.
Brendan: Yeah, I like that concept of distance travel. That's a good final thought. So, as we wrap up, if our audience wants to learn more about the firm, more about the podcast, what's the next step they can take?
Minnie: Well, certainly they can check out the podcast LA Venture. And you know, reaching out on LinkedIn, I actually, I do my LinkedIn. I follow my LinkedIn. Not everyone does, but I probably follow it more than my Twitter and other channels.
Brendan: All right, so follow the podcast and connect with Minnie on social. Any content that you're putting out there from newsletters or blogs that our audience should be aware of?
Minnie: They can also go to our website and subscribe to our newsletter and we put out our thoughts and a lot of news about our portfolio companies and sort of why we invested and what's going on with our portfolio.
Brendan: All right, well, great. Well, Minnie, I really do appreciate the time. It means a lot. We thank you, and we look forward to staying in touch.
Minnie: Oh yeah, thanks for having me on.
Brendan: Alright, I'll see ya.
Minnie: Thanks.