“There are a lot of requests from people wanting to break into the VC space. I encourage people to start thinking about the VC processes like sourcing, picking, helping, exiting, and demonstrate their competence by writing about it. Show a record of your thinking because that's essentially what investing is. It's thinking and making a decision. I don't encourage people with pure finance backgrounds to go straight into early stage VC where it’s pretty hands-on and operational and you won't have a lot of context or empathy for that stage. I always encourage people that if you've only done two years of banking or you’re fresh grads, go work at a company first instead of trying to get straight into VC.” - Shiyan Koh
"You have to meet and believe in the founder, but you also have to do the math on the market size, the product market fit, and the acquisition costs. If you do the math, you're better than a good chunk of investors out there. You have to be thoughtful about putting the numbers in writing and ask yourself if you believe it. There's a huge value added to the founder when you have that conversation with them openly, and it's also a great way for you to better differentiate between which are the good companies and which are the great ones.” - Jeremy Au
“We strive for an unbiased, open application process and if it's someone we know personally, we ask someone else on the investment team to evaluate it. We try to remove bias from all parts of the system, and that's our part of the universe that we're trying to make as fair as possible. That goes back to what the zone that you can control is. We want to promote other women, suggest them for speaking spots, and make introductions for them, but at the end of the day, there are other things that we’re not able to control.” - Shiyan Koh
In this insightful conversation between Jeremy Au, a venture capitalist, and Shiyan Koh, the Managing Partner of Hustle Fund, they discuss various aspects of venture capital and investing. They highlight the importance of diversity and representation in the VC industry and the need to address biases. Shiyan emphasizes the need for a fair and unbiased approach in the investment process. They also delve into the challenges faced by women and minorities in the field, along with the significance of mentorship and support in breaking into VC.
Jeremy and Shiyan share advice for aspiring VCs, emphasizing the importance of understanding companies deeply and demonstrating competence in sourcing and picking. They discuss the indeterminate nature of venture investing and the need to enjoy the process, despite its uncertainty. Reflecting on their experiences, they offer insights into the journey of a VC and the value of continuous learning.
- Importance of diversity and representation in the VC industry
- Addressing biases in the investment process
- Challenges faced by women and minorities in VC
- Significance of mentorship and support in breaking into VC
- Advice for aspiring VCs: understanding companies deeply and demonstrating competence
- Embracing the uncertainty and enjoyment of the venture investing process
- Continuous learning and growth as a VC
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Jeremy Au: (01:34)
Hey, Shiyan, another morning, another podcast.
Shiyan Koh: (01:37)
How's it going? It's been quite an eventful week, but not in technology.
Jeremy Au: (01:41)
I know, right?? It's just like, wow, there's so much to discuss privately, but you know, is this relevant for the show? Is this what the readers want?
Shiyan Koh: (01:50)
Jeremy Au: (01:51)
Such shame. But, the biggest news of the week was, did you get your Taylor Swift tickets?
Shiyan Koh: (01:55)
I did get Taylor Swift tickets. How did you know that I was queuing for them with all of Singapore and the entire region?
Jeremy Au: (02:03)
So you have those special cards, that you had priority access, were you queuing up? How many devices? How did you get it?
Shiyan Koh: (02:09)
My wife has a UOB card. She has a UOB Lady's card, which I have to say is the ugliest credit card on Earth, and it's so stereotypical. It is pink and has ugly flowers and it gives you rewards for tuition and groceries, like it's horrible. But you know, we do buy groceries and so we have this card and it came through for us in the purchase of Taylor Swift tickets. So, yes.
Jeremy Au: (02:33)
Now, there's no way you can blame her for the ugliness anymore since it's got the tickets, right?
Shiyan Koh: (02:38)
I don't blame her. I don't blame her. I blame whoever just designed this card. It's hideous. I feel like if you were designing a card, you want a card that when somebody pulls it out to pay for something, other people are like, wow, what's that? Not like, wow, that's really freaking ugly.
Jeremy Au: (02:54)
And we were saying a little bit about it was just the fact that, you know, you're sold out, it's like in eight hours, you know, people are queueing The Sing Post. I think there are people all across the region who are flying in from the Philippines and Indonesia just to kind of get those tickets. It's a kind of a crazy blitz.
Shiyan Koh: (03:09)
Yeah, it's incredible. I mean, I think I'm really curious about what the increase in the volume of UOB card applications is, based on this. Not that I think that those are necessarily great top-of-funnel leads, but I mean, it's sort of insane. I don't even know how much the sponsorship costs, but it was great publicity, and it's the only Southeast Asian destination, right? They're not going to other cities in Southeast Asia. So I think we have the whole basket of demand collapse in Singapore.
Jeremy Au: (03:33)
Yeah, I think I was just reading here that Taylor Swift fans cost a 45% surge in UOB card application volumes across Southeast Asia. So now.
Shiyan Koh: (03:42)
That's pretty It's insane.
Jeremy Au: (03:43)
I mean, maybe it's a low base, so I mean it's a pretty decent base, right? But still, I'm just wondering, in my head, if somebody has to do the math, which is like, how much does the sponsorship cost versus the per-card application? Of course, I think actually if they're recurring users, right, I think they're actually going to more volume into the card, right? I think that's in my head and I think it's underappreciated because you can buy the card just to kind of get Taylor Swift tickets, but then are you actually going to move a specific amount of spend in? There's going to be an interesting analysis.
Shiyan Koh: (04:08)
Yeah. I mean, I did a bunch of work on cards before, and so, what ends up happening with cards is like people spend a lot of money marketing, like benefits and things like that, and they're mostly just trying to get people to move to spend from one card to another, right? Everyone wants to be like the top of a wallet card, but the interesting ones are the ones that can actually create new categories of spend. So like places where people previously couldn't use credit cards and then suddenly they can use it. So you're not like trying to move people from one other thing. So like, there's a card in the US called Bilt where they basically allow people to pay for rent with credit cards.
Jeremy Au: (04:38)
Shiyan Koh: (04:39)
There are a bunch of details so that the rent payment doesn't actually move on credit card bills, but they give you rewards for paying your rent through their system, and they work with landlords who basically also want more on-time payments, right? And so I would actually, like, here's a request for startups. I would actually love to see someone do that for enrichment activities. So many enrichment activities don't accept credit cards and have terrible billing systems, and actually, it would be beneficial for both sides. Enrichment activities would get paid more regularly if they would just take a credit card on file. For the parents, like if you get rewards, like that is a part of your spend today that is not currently captured by any card spend. So, issuers, if you're anywhere from any issuers in our audience, please come talk to me. I really feel they should exist. I would love to brainstorm on this topic with you.
Jeremy Au: (05:24)
That's great. I mean, it almost sounded like a request for a startup for a one-click checkout for enrichment centers.
Shiyan Koh: (05:30)
No, the era of Fast and Bolt and all those guys have come and gone, but yeah, I mean, enrichment centers, man, don't get it. Even, it's like tennis, you know, my kids' tennis class or soccer or whatever. It's just such a pain to pay for.
Jeremy Au: (05:45)
and on related news to the women's card, and so so forth, DealStreetAsia and Nikkei Asia wrote a report on decision-makers at VCs focused on women's representation, so basically some key statistics they said was that women now account for 17.4% of all decision-makers at VCs headquartered in Southeast Asia. However, 67% of Southeast Asian investors don't have a woman in an investment decision-making role, and they define it as somebody who has the ability to lead deals, sign checks, and sit on company boards. And this is across about 400 funds that they're looking at. And they think that it's gone up 15% over time but they still feel like a lot still needs to be done. So any quick reactions to the statistics here?
Shiyan Koh: (06:31)
I mean, What's your reaction? Are you surprised? This is old news, right?
Jeremy Au: (06:35)
Well, I think it's nice that the number's getting better. I mean, I think that's one. Come on. Come on, Shiyan.
Shiyan Koh: (06:41)
Often incredibly low base. I mean, I don't know. I'm not ready to pat ourselves on the back like literally two-thirds of firms have no female decision-makers. So in the one-third that do, they're accounting for this 17%, which is like one in six.
Jeremy Au: (06:54)
Shiyan Koh: (06:55)
Investment decision-makers are a woman like, okay, great.
Jeremy Au: (06:59)
I guess maybe that.
Shiyan Koh: (07:00)
We're, I'm not ready to throw a parade. I'm not ready to throw a parade if that's what you're going to say.
Jeremy Au: (07:04)
Well, I'm not saying that. You just asked me how I reacted. Just, you know, it's fair. If you're growing at 15%, I am still determining what the timeframe was, but I guess there's a pretty slow growth rate because that's going to be like, what, 10 years before it actually gets 30-something percent.
Shiyan Koh: (07:18)
Yeah, I'm not holding my breath here. I don't know. I mean, my first job in the venture was in, oh God, 2000? My first job, I had a venture internship in my sophomore year of college, so what was that? 2003? My first full-time job in venture was 2007, so it's like 20 years ago, and it was kind of the same. It's gotten slightly better. People talk about it more, they didn't really talk about it as much before, but the dynamics are still pretty similar.
Jeremy Au: (07:44)
As you said, it's a low base.
Shiyan Koh: (07:46)
Do you have something uplifting to say? I hope you have something uplifting to say.
Jeremy Au: (07:49)
I feel like if I'm going to say something uplifting, you going to mock me relentlessly.
Shiyan Koh: (07:53)
I mean, it is kind of the basis of our relationship, but no, I mean, I don't know. It is what it is, which is like, the numbers aren't great. It's probably reflective of like finance as an industry as a whole, but I think another part of it is that it's a sort of cottage industry, right? So it isn't like it's something that has like really established pipelines. And so when you think about what the pipelines are, which is like investors from other firms, oh, the other firms already didn't have many women. It's successful entrepreneurs, well entrepreneurs as a whole tend to be male-dominated so that also is a pool that is skewed or people who kind of like grew up in the industry like they started as associates to kind of worked their way up. Well, there are just not that many of them because, you know, for a long time there just weren't that many firms. I think the stat, we talked about this before, right, which is like 80% of the money being managed today is by funds that haven't been in existence for more than 10 years.
Jeremy Au: (08:41)
Shiyan Koh: (08:42)
So if you just think about what the top-of-funnel feeders are, there's just not that many and it's a really small pool, so you kind of get this crazy stuff. I mean, I think on the optimistic front, the things that I would say that should cheer us is more women are starting their own firms. So rather than sitting around waiting to be promoted by all male partnerships, they're like, I'm going to go start my own firm. Some of these growth and crypto firms were started by women. So like Mary Meeker's fund. There's a new two-female GP fund just started by Jess Verrilli and April Underwood from Twitter. I think it was just announced last week. So I think that's the way that change is going to happen. More people are just willing to do that and with more attention to it, their LPs are saying like, Hey, I want to allocate to that.
I think the second thing is with the growth of syndicates and angel investing. There are people coming up through that path, which was not as common, I would say, 10, 15 years ago, where, I could be a value-added angel. I can put together a syndicate of a hundred, 150k and I can build a track record that way, and then I can roll that into building a fund. So I think those are kind of like the bright sides of it, but that's all I got.
Jeremy Au: (09:39)
Okay, well, about VCs who've kind of set up their own funds, we do have, for example, a quote here from Valerie Vu, Ansible Ventures. She was previously on the podcast twice on bravesea.com. She said, in the past, male VCs rejected startups such as Pinterest, Stitch Fix, and Bumble because they didn't feel excited or connected to a problem being solved. This highlights the importance of diversity in thoughts and experiences brought by female investors. So this is a quote on Nikkei Asia, just want to get your reaction to that, Shiyan.
Shiyan Koh: (10:05)
Yeah, I mean, I think that's true, which is like, the Stitch Fix founder is a friend of mine. We went to school together and she had a really tough time raising, even though she had a great business. She was super savvy. She excels and had worked in the venture before. She went to Stanford undergrad, Harvard Business School like she had every advantage in the book and it was still hard for her. So that's totally true. I think often when people can't really understand the customer or their problem, they're kind of like, oh, the market's too small.
Jeremy Au: (10:29)
Shiyan Koh: (10:30)
I think there are some topics that people are like uncomfortable with, like I remember a friend was pitching a startup that could do a lot of diagnostics through menstrual blood. And basically, she was just like, the moment I said the words menstrual blood, you could see the entire investment committee being like, you know, like, don't want to talk about this. and they'd be like, is the market big enough? And you're like, I don't know, half the world, they menstruate. Is the market big enough? So yeah, I mean, I think that that's true but I think people also realize that and they're trying to start actively working through their blind spots and trying to get a better perspective on those things.
So I think the same thing is true for like, it is particularly true for where the female is the end consumer and people might not understand the customer journey or the pain point as well, but this thing also exists for other blind spots, like you're from a developed market, it's really hard to understand why emerging markets have certain types of purchasing behavior and vice versa. And so, I would agree with Valerie's comments.
Jeremy Au: (11:29)
Yeah. You know, I think I was looking at a company that was basically looking at groceries, and so talking about helping mediate the relationship between wet markets and households. And it turns out all the decision-makers are homemakers in Indonesia, for this. So it was like 95%, it was the numbers. So, a big part of the reference check process and customer check process was basically talking to homemakers to say like, how and would you buy this? And what's your purchase decision? Et cetera, et cetera. But you know, there's a very hot category, but there's a good example where for example, being understanding or being familiar with what's alike with the customer target is really important and that's one aspect of it, but there are many other aspects. I was in childcare, so that was an interesting category at my last company, in education tech. So a lot of them are women decision-makers, honestly, as part of the purchase decision that we're working with. Obviously, jewelry is a big category as well. So I think there are some interesting categories.
Shiyan Koh: (12:23)
Jeremy Au: (12:23)
Yeah. Blue Nile. I mean, heck making money in, you have made good money. You have made good money in Blue Nile. Yeah, exactly. Oh, for sure. Yeah.
Shiyan Koh: (12:30)
Do you like diamonds Costco? That blows my mind, actually.
Jeremy Au: (12:34)
At Costco? What?
Shiyan Koh: (12:35)
Another reason why Costco is awesome.
Jeremy Au: (12:38)
I just don't know how I'm going to tell my wife like, Hey, I got your diamond from Costco. I think that's an interesting dynamic, which is adding think so much consumer spend, and I think there's a saying from China that says like, women hold up half the sky and sometimes I kind of think about it quite a bit, which is like yeah, consumption span, so many joint households as well where both partners could potentially be making a decision on purchase and so, so forth. And so having empathy with at least, like you said, half of the consumers in the world is a minimum requirement. And so I think for me, what I've noticed is that a conversation does just have, is just like a lot of VC function should just be like, Hey, you know, we have a giant blind spot if we just don't have a voice at a table, like you said, for consumer awareness.
Shiyan Koh: (13:16)
Yeah. I totally agree.
Jeremy Au: (13:17)
I think there's another quote here that's interesting. I would love to get your response to that. So, Jennifer Ho, a partner at Singapore-based Integra Partners said, " For me, the trickiest part of being a woman in a male-dominated industry is that you're still the exception rather than the rule. It's very seldom about outright discrimination, more often it's the way you're ignored in a meeting or asked to manage your schedule or the questions you've asked, and a constant wondering if a man would've been asked the same questions or treated the same way. What are your thoughts?
Shiyan Koh: (13:43)
I don't know. I think about what I tell my children a lot, which is you can't control what other people do. You can only control what you, yourself, do. So, people are going to think their own thoughts. I can't control that. I'd rather not spend any time thinking about it. Being a better investor and working with my own strengths. I think gender aside, I think everyone has a different style. Everyone has a different way that they show up, a different way that they bring value to founders, and it's important to recognize that. I have some partners who are really strong on CAC, some partners who are like really strong on emotional connection, empathy, all these sorts of things. And we're just all kind of like good at different things and so we have to show up and win deals based on what we can do. And yeah, probably, there are times when men wouldn't be asked the same questions that we would, but like there's not a whole lot you can do about that. You can't the other person. You only control yourself. you know, I think my general approach is just try to like diffuse things with humor. If I don't like a question, I just try to make fun of it. And hopefully, the person asking realizes it's ridiculous and, I mean, it's interesting. I don't know, I read a quote where little girls are told that they mature faster, so they should be more patient with little boys, but why aren't little boys told that they should look to little girls as examples of leadership and maturity since they are maturing faster I mean, there's a lot of this stuff, but like, I think in business, it can often be hard to achieve things if people perceive you as an activist who want to beat the drum on a very specific point, and I feel that you can get, you can change more hearts and minds basically by building relationships with people and showing that you're really effective. So I don't know. Maybe that's not particularly peasy.
Jeremy Au: (15:22)
I mean, I think it's fair, right? I think the question is, there's a way we look at the structures and also we look at it from an individual perspective. What can you control versus what can you not control? I don't know.
Shiyan Koh: (15:31)
Yeah. I mean, I think from a structured perspective, like things that we do, which is like, hey, we started our own firm. We have two out of three GPs or women. We really try to strive for an unbiased, open application process. It's not a warm intro required type of deal, and if it's someone we know personally, we try to ask someone else on the investment team to evaluate it, right? We try to remove bias from all parts of the system, and that's like kind of our part of the universe that we're trying to make as fair as possible, but that kind of goes back to like, what's the zone of stuff that you can control, and I think, you know, we want to try to promote other women, suggest other women for speaking spots, make introductions for them, do all that kind of stuff. But at the end of the day, there's a bunch of stuff that we're not going to be able to control and I can't spend too much time thinking about that.
Jeremy Au: (16:09)
Yeah. I think that's true. I think panels and representation are important. So I remember I was on the panel, it was all guys, for angel investors, and I wasn't the organizer. I just showed up. But then, I got feedback from several friends to be like, Hey, you are on this panel, you're speaking, and it was all guys and I was just like, okay, now I know. And so, I think there's been a few times now where I'm just part of, you know.
Shiyan Koh: (16:29)
Jeremy Au: (16:30)
I messaged the organizer. I'm like, could we at least have a female representative on this panel, and just have that conversation?
Shiyan Koh: (16:36)
Thank you for being ally, Jeremy. I appreciateit, but I think the other aspect of that is like sometimes you get added to these panels and then all they want to do is ask you questions about being a woman when the panel is about being an investor.
Jeremy Au: (16:48)
Ooh. How do you feel about that, Shiyan?
Shiyan Koh: (16:49)
I don't like it. Shocker.
Jeremy Au: (16:51)
You'd be like going off to Jeremy and be like, how do you feel about being Asian?
Shiyan Koh: (16:58)
Yeah, like what if I'm just like Jeremy, how does it feel to be an Asian investor?
Jeremy Au: (17:02)
Jeremy, how feel to be an investor with black hair and shot? Right?
Shiyan Koh: (17:06)
I mean. I don't know, do you spend any time thinking about being an Asian investor?
Jeremy Au: (17:10)
Well, I mean, there's a symbolic value, right? So I think you have to serve that role of being representation. I mean I experienced that to some extent. I was an Asian founder in the US. I was considered a minority from the perspective of accounting, from a fund perspective and so, so forth. Yeah, and my co-founder, she's a woman as well, so I think I shared before, some VC was like, oh, that's great. We can count you in our diversity metrics twice, you know?
Shiyan Koh: (17:32)
Oh, God. Did they say that out loud?
Jeremy Au: (17:36)
They said that out loud. Yeah, I know. So it's like, Caucasian female co-founder, me, an Asian male. And then they're like, oh, it's great. Yeah, you both love education, and I was just like, sorry. Like files, download files, memory, core memory. I'm just like, okay. Oh boy. But I mean, what was I going to do it at that point in time, right? I'm just going to be like, yeah, I'm great. Can we talk about the pitch and hopefully it's helpful if I laugh and play along.
Shiyan Koh: (18:03)
Jeremy Au: (18:04)
Yeah, but I mean, I think there's different tiers. So okay. Epic things are slowly getting better. I think one I'll say, well, I have to say something optimistic now cause you asked me to do it for which you'll mock, but I would say that, I think one thing I'm starting to notice is that I think if there's really bad behavior, I think something to come up, it's becoming more obvious that's wrong, and people talk about it. I think that's there. I've heard bad stories about inappropriate behavior and then people are talking about it and they get penalized as seen actions by VC funds to ding the various folks and make sure there are the right follow-ups, for example, like inappropriate workplace relationships and so, so forth. I think that's improving, right?
Shiyan Koh: (18:43)
Yeah. I would say yeah, that's probably true. I think the sort of Me Too movement has empowered people to basically call stuff out, bad behavior, more, and I think that's definitely like, what is it? Sunlight is the best disinfectant, so it brings more focus on people's behavior and being like, Hey, that is so unacceptable.
Jeremy Au: (19:02)
That is so unacceptable. That's really kind of the phrase.
Shiyan Koh: (19:05)
Yeah, so I, I think that that's, that's true. Did you ever have to do sexual harassment training when you were the US?
Jeremy Au: (19:12)
So, okay, I got an interesting story here, right? Which is, in a startup you need to have these like workplace posters, and then you buy one of those, one page so they can fill out everything so that it's like, all done. And then, obviously you do training with each of those panels, right? And you write it down. And then, I always remember that there was this section that they had, which was like in X situation, you need to report to the fire marshall right? Then you write this, write the name, who the fire marshall is, and then there's a line for like sexual harassment officer. And then I had to write my name, but I was like, shouldn't be like sexual harassment reporting officer rather than sexual harassment officer. I'm just saying, right? You know, I was just saying like, this is, we could redeem this. But there was like a requirement in Boston for us to detail. I don't think there's an equivalent in Southeast Asia. Not that I'm aware of.
Shiyan Koh: (19:58)
No, I don't think so. But like in California, if your company is above a certain size, you have to do mandatory, state mandated sexual harassment training, and you have to watch these videos, and like David Schwimmer is in these videos, and so you're like, wow, didn't he make enough money from Friends that he doesn't have to make weird sexual harassment videos for the state of California?
Jeremy Au: (20:17)
Wait, is he the trainer?
Shiyan Koh: (20:18)
No, he's like an actor. Basically what they do is they act out scenarios and then they ask you questions like, is this acceptable? Is this not? Like, what should your
Jeremy Au: (20:26)
So this guy, so he's like, he awkwardly pretends. Oh, my Ross. Yeah, I know, but I mean he's awkward as Ross, but I'm just saying like he's actually acting out these scenes.
Shiyan Koh: (20:34)
Yeah. So like, he's like the boss or he's like the like creepy colleague or whatever, like, you know, it's just, I don't know. It's hilarious.
Jeremy Au: (20:41)
Well, he did recently, he recently did an ad for, a gambling ad, effectively, it's on app store, and it was like, Coin Master, it's basically slots. This is a guys as a game. This is a unicorn. I think Inside Partners invested in them, making bank, Israeli company. But yeah, I think Instagram was like, whoa, Ross really took a turn there. So, yeah, I mean, I guess he's doing all the ads.
So I think that's a fair point. I think there should be minimum requirements on like whistle blowing sexual harassment. Actually, I think whistle blowing is an important one. So I actually, had to recently help a Web3 startup. Somebody saw something that's inappropriate and then basically had to do all the legwork from scratch to understand like, should I report, should I resign? What are consequences for reporting?
Shiyan Koh: (21:20)
In Southeast Asia?
Jeremy Au: (21:22)
Yeah, and I think what was interesting to hear a little bit is yeah, there's no mandatory requirement to, there's no whistleblower protection pretty much. So I think it's like a interesting dynamic. So obviously, it's a broader issue than just sexual harassment or so so forth, for women representation, et cetera. But I think there's so much prevention that can really happen from that.
Shiyan Koh: (21:38)
Jeremy Au: (21:43)
Any advice you can give to women VCs?
Shiyan Koh: (21:46)
I mean, I wouldn't, I'm on the journey too, right? I wouldn't presume to give advice to other investors. I do get a lot of requests from people wanting to break into this space. I think there's lots of different backgrounds that people can have to come in, not just the traditional two years of banking, consulting, two years startup, and I encourage people to really just start thinking about the process of vc, right? There's the sourcing, picking, helping, exiting, and you want to basically demonstrate competence in o ne of these things to the extent that if you think you have interesting sourcing or picking skills, like start writing about it. Show a record of your thinking, because that's essentially what investing is. It's like thinking and then making a decision. And so you can do that without actually investing, you can start sourcing things and you'd be like, oh, here's why I think these things are interesting.
Why or why not? Here's why would it invest whatever it is. And I think that's actually a really good exercise to demonstrate those things. And I kind of don't encourage people with pure finance backgrounds to go straight into VC , at least early stage, where there's a lot of early stages, that are like pretty hands-on and operational and you don't have a ton of like context or empathy for that stage, and so I do always encourage people if you've just done two years banking or whatever, go work at a company, or even fresh grads, go work at a company instead of trying to get straight into VC out of college.
Jeremy Au: (23:04)
Shiyan Koh: (23:05)
And then if you're from a non-traditional background, even more, you're going to have to prove that you can do these things. And that's why even more writing, doing a podcast, whatever it is, but documenting the quality of your thinking becomes even more important because you could show that to anyone who's interviewing and if you're writing especially if you're really interested in niche spaces and you become an authority, people will find you. So people will reach out to you and be like, Hey, what do you think about this? Or you want to come and interview with us? Versus you applying in. So I think that actually is more effective and I think the act of doing it actually improves your thinking as well.
Jeremy Au: (23:37)
Right. I agree. I think what's interesting is that, yeah, lots of folks want to break in, and I think the tricky part that I would often advise them is actually understanding what VC does and seeing whether you actually want to be a VC. I think there's a lot of thought leadership that VCs do, podcasts included, but I think being thoughtful about actually whether you want to do that, whether you want to take meetings with lots of different folks, whether you want to do that picking dynamic to actually help them, the timeframes, the economics of what it actually looks like. It's not obvious. I think you really have to shadow someone to really see and understand what they're doing, and it can be an exhausting job. And I think one thing I heard recently was this like, just talking to a whole bunch of junior VCs across the region and a lot of them are exhausted, because right now it's a bear market. They're not doing a lot of deals or they've been effectively not doing deals for six months or nine months across as a firm. So they're not doing enough work. They're doing a lot of meetings, doing a lot of conversations, writing a lot of memos, but they're not actually doing deals and actually helping the founders. And that's very frustrating. And so I've heard of many junior and middle folks who are saying like, maybe we should rotate back out into startups or operator life again?
Shiyan Koh: (24:44)
Yeah, you have to like the job. Oh, the other thing I tell people is, it takes a long time to figure out whether you're any good.
Jeremy Au: (24:50)
Shiyan Koh: (24:50)
And some people just, it's really frustrating, in an operating role, every week you kind of know what revenue is. You're like, did I reach my number, or did I not? Is it working? Is it not? And I think with venture it's like five to seven years.
Jeremy Au: (25:02)
Shiyan Koh: (25:02)
And you're, you're like, you don't know. There's some intermediate milestones, but you kind of don't really know for a while. So you have to enjoy the process because the outcome is unknown and I think that can feel that indeterminate outcome can feel really scary to people.
Jeremy Au: (25:15)
Yeah. I think you get to look good because as a VC, your job is to meet people, be on panels and speak, and that's part of the job. But whether you are good at a job, jury's still outright, I think.
Shiyan Koh: (25:31)
Yeah. And a lot of it is luck, and you know, my mom says, better to be lucky than smart, so I'll take it, but what cycle were you in? How much dry powder you had at that point in the cycle? How did you deploy it? So that all matters.
Jeremy Au: (25:43)
Yeah. I think one thing I think about, and maybe less for women VCs, but like you said, non-traditional, right? So you're some sort outsider. You're a minority, you're not from the country, whatever it is. I think one thing advisors often share is you really have to understand companies because at the end of the day, yeah, you're selecting for them, you have to understand them from a financial basis. You got to understand them from a team basis. You got to understand the product market fit, and if you don't understand a company, I think it's very easy to believe you understand a company cause you read the memo, right? You know, you read a website, you read all the stuff, but whether you actually understand the company, that's something that you have to do and you have to demonstrate and you have to believe in at some point. I think that's something too, and I think it's a bit easier actually to understand how that happens.
Like you said, when you're working at a startup, when you're working from the inside, then you can actually see that pass out the gloss and look on the inside.
Shiyan Koh: (26:33)
Yeah, every startup is a shit show, and so it's just like how much shit you can put up with. They're just super messy and so it's like, what kind of mess can you stomach, but also like, what kind of mess is normal versus what kind of mess is going to kill you?
Jeremy Au: (26:45)
Shiyan Koh: (26:45)
Those are actually important distinctions.
Jeremy Au: (26:47)
Yeah. And I think working at a startup is great because it's very meritocratic in the early days. It's all hands on deck, people get stuff done, you got to do change. No one really cares, right? So I think some of this unfair selection processes really kicks in in larger organizations, or kind of like organizations that can afford kind of like look past merit in that sense.
Shiyan Koh: (27:06)
Jeremy Au: (27:07)
Shiyan, when you look back on time. uh
Shiyan Koh: (27:10)
Jeremy Au: (27:11)
Any advice you have given yourself five years ago when you were, you know, early, you know, as a investor right? Five years ago, any advice you would've given yourself on an investing front?
Shiyan Koh: (27:21)
I mean, the advice I would give myself is I should have started angel investing earlier. So I was so heads down when I was working at NerdWallet that I like didn't have bandwidth for anything else, and I feel like I should probably just have like lifted my head up periodically and be like, Hey, what are my friends doing? Maybe I should just write some checks here. You know?
And even like going back to business school or I read, I wrote a few checks to some business school friends, but business school and like my undergrad friends and things like that, you know, you really can write small checks if you have knowledge and relationship and getting more reps in I think is important for an investor. And so, that would've just like, I mean, the nice thing about my fund strategy is I do get a lot of reps in, but I could have done that even earlier.
Jeremy Au: (28:00)
Yeah. And that would derisk your approach, that were giving you the skillset, and you had found out if you liked investing, right?
Shiyan Koh: (28:06)
Jeremy Au: (28:07)
Yeah, I was talking to someone who has set up his first fund. He's a minority and he said like, yeah, my biggest advice to was to not do it so early, because he was like, whoa, you know, he was able to successfully launch the fund and so, so forth, but he just took so much work and he didn't realize how much risk he was actually taking that in retrospect, you said a few more years of investing would've given him a better chance of success. I thought it was interesting to hear that advice and reflection because it makes me think sometimes it's really good to start, get started and do as much as you can. And sometimes I think you just have to take a step back and get prepared and I think that's the, I wouldn't say philosophy difference, but I think there's a nuance that has been taken care of.
Shiyan Koh: (28:46)
Jeremy Au: (28:47)
Any parting words of advice?
Shiyan Koh: (28:51)
I don't know. I always feel awkward when people ask for advice. It's like, what? What do I know? We're just all trying to do our best here. But I mean, I think having a conversation, really reflecting on whether you like the work, as you said, Jeremy, I do think that they're important and I think people probably don't spend enough time on that.
Jeremy Au: (29:05)
Yeah. For me, I a hundred percent concur, Shiyan. So now that you said that, I think I have to do to my number two. It's do the math. I think it's obviously you have to meet the founder, believe in the founder, but you got to do the math on market size, the product market fit, acquisition costs. Just do the math because if you do the math, I think you're better than a good chunk of investors out there actually. And so I think that's an easy way, if comfortable doing the math to just be thoughtful about putting the numbers in writing and just saying, Hey, do I believe this? What do I have to believe? What do I not understand? What do I have to believe in the future? And I think there's a huge value add to the founder when you have that conversation with them openly, but also it's a great way for you to differentiate between which are the good companies versus the great companies.
Shiyan Koh: (29:45)
Jeremy Au: (29:46)
On that note, peace out, and see you next week, Shiyan.
Shiyan Koh: (29:49)
See you next week.