Steven Melia: Openview Ventures

In this episode, Joel Palathinkal chats with Steven Melia about his career shift to True Search and OpenView Ventures. They explore hiring in venture funds, strategies for joining top VCs, and OpenView's diverse team approach. Steve highlights the value of sales skills, personal branding, and a unique perspective in venture capital. They discuss crafting a career narrative, transitioning into venture, and essential skills for different VC stages. Topics include financial models, product-led growth (PLG) strategies, effective networking, blogging for differentiation, evaluating PLG companies, and SEO. The episode concludes with a nod to the OpenView podcast.

Episode Transcript

(00:00):
So you'll see p l successful PLG companiescross verticals.

(00:06):
And so you think of Atlassian was probably likethe flagship one.
And, you know, I think of Slack even.
Think about how
you use
Slack, right?
You can use it as a consumer and then you and Istart using it at work because we're chatting
during the day.
Then all of sudden this whole group's using itand then your group leader says how are you

(00:26):
guys all talking during the day and then bringsit to your president or CFO to say hey, should
be using this as our company communication,right?
So it's around the virality in the product.
It effectively sells itself at those earlierstages.
So that's an extreme example, right?
Slack.
And if you look at Calendly, one of ourportfolio companies, I send you my Calendly

(00:47):
link, great.
Then you're like, oh, what's Calendly?
Welcome to The Investor, a podcast where I,Joel Palafinkel, your host, dives deep into the
minds of the world's most influentialinstitutional investors.
In each episode, we sit down with an investorto hear about their journeys and how global

(01:08):
markets are driving capital allocation.
So join us on this journey as we explore theseinsights.
Get this live here and then, we'll just get getrolling.
So, it looks like we are good to go.
So, we're here with Steve Malia with OpenViewVentures.

(01:29):
A new friend of mine, really getting to knowtheir fund and understand what their thesis is.
But before we kind of get into the fundstructure, Stephen, number one, thanks for
coming here.
I know you're super busy.
So, really appreciate you making time to dosome storytelling and talk about venture, talk
about your background.

(01:50):
So again, thanks sharing bandwidth and yourtime with us.
Maybe we can kick off with just a little bitabout your career and your background and how
you broke into recruiting, how that's evolvedand how that's kind of evolved with Venture and
your journey into OpenView.
Yeah, absolutely.

(02:12):
Thanks for having me.
So interesting journey so far.
I'm from the Boston area.
I went to school out in New York at UnionCollege.
The classic econ major, that was the closestthing I could get to business.
It was either econ or engineering.
I definitely didn't fall into the engineeringbucket.
So one econ junior summer comes rolling aroundand say, hey, have to get an internship or I'm

(02:34):
never gonna make it.
So followed everyone else, chased the WallStreet dream, talked to a lot of banks.
And in that networking process, actually metsomeone who worked at Korn Ferry who was the
managing director here in the Boston office.
Didn't know anything about recruiting.
All I know is that this person couldpotentially help me open some doors at these

(02:55):
banks.
I went and sat down with them and said, hey,here's my story.
Here are some of the firms I'm talking to.
Went on for about forty five minutes doingexactly what we're doing right now.
The person started laughing.
So I said, great.
The person who's gonna get me a job is nowlaughing at me.
So he said, Hey, hear time and time againeveryone's looking to get right into Wall

(03:15):
Street.
It's the only way you can break into investingor other industries but that's actually false.
A lot of people are getting into different swimlanes, learning new skill sets.
He walked me through executive recruiting, whatcame with that, how it's business but more on
the people side.
And I was hooked and Goldman Sachs was notcalling me back at the time.
So I actually ended up doing an internship withthem that summer.

(03:37):
Started full time post school And Korn Ferry isthe largest executive recruiting platform in
the world.
So they work with a majority of the Fortune2,000 companies hiring all C suite functions
you can think of across the board.
Doing it the longest so that was great trainingexperience.
Over time at Korn Ferry I got more and moreexposed to the private equity practice and

(04:03):
working with those companies which was verydifferent than the Fortune 100 clients.
A little bit more like the Wild West at thetime.
So executive search has taken off and one ofthe big things that was happening was people
were spinning out of these large platforms andstarting their own boutiques.
One of those was True Search.
So connected with one of the partners there whoI used to work with at Korn Ferry and said,

(04:26):
hey, what are you doing over at True?
And said, listen, we focus exclusively onventure private equity backed businesses in
doing executive recruiting for those companies.
And I said that's exactly where I wanna head.
So Left Korn Ferry made my way to true searchabout five years ago.
At the time they were a 50 person smallexecutive search firm just starting to do some

(04:48):
work with Excel and Sequoia.
Some flagship funds but a really competitivelandscape still.
And then they took off.
They're now a top 10 global search firm reallycatering to that group.
They've stayed really consistent with thatventure private equity back business group.
So we did work anywhere from a seed stage, bankcapital ventures, Sequoia company up through

(05:12):
series A through F with insight, Excel, openviews of the worlds and then into the private
equity players as well with Vista and others.
So great experience.
I was part of the go to market practice there.
So I did a lot of CRO and CMO work primarilyfor those growth stage businesses.
Did a lot of work with UiPath, 1Password.

(05:35):
A lot of these emerging businesses that havenow gone on to be very successful public
companies.
Really like the transformational stage of thebusiness.
In that time I got to work with a lot of VCsboth on the operating side for their portfolio
companies and then started to do a little bitof work on actually recruiting for the funds
for their investment teams.

(05:55):
I got to see how both sides work.
OpenView was always in my backyard.
I always admired their portfolio and how theyapproached investing is definitely a unique
model and timing lined up for this talentpartner position which I'm in today.
So I made the move just about a year ago.
Almost moved in March and obviously some thingsunfolded in March 2020 that were on first

(06:19):
scene.
Put it on ice and then actually officiallyjoined in July when things settled just a
little bit.
So I'm with the firm sense.
That's really great.
Maybe you can walk us through just some of thedifferences with just tier one VCs trying to
get in versus kind of what you've seen withjust people getting in on their own.

(06:40):
Because I know that there's kind of a lot moresteps in the process when you go into a tier
one BC.
So in general, right, what are some of thethings that you've seen as a pattern that have
helped people kind of over the hump and kind ofgo through the process?
And you and I were talking about this before,it seems like the concept of just the pedigree

(07:05):
has actually surpassed, right?
So there's not really just the top tier schoolthat you went to, but kind of the whole package
right now.
Now it seems like they're making people do alot more interactive exercises.
People are putting together an investmentthesis probably maybe in real time.
So I guess maybe could you walk us through whatto expect if somebody is applying to Sequoia or

(07:30):
Excel and what does it really take?
The ones that you see get passed through, whatare kind of some of the challenging steps that
they have to kind of make sure they go throughand be prepared for?
Yeah, it's definitely evolving.
I think it's very different fund to fund.
I think everyone has their own approach andlooking at OpenView specifically.

(07:54):
We are getting larger run to fund six butcertainly have some years behind or funds
behind the excels and sequoias of the world interms of AUM.
But for looking at OpenView then kind ofbranching out to these bigger funds.
So we're all B2B expansion stage software.
So we lead series A and B investments, checksize from anywhere from 10 to 30,000,000 on

(08:17):
average.
We cast a wide net across B2B.
So you'll see anywhere from Datadog through toCalendly through to Axonians.
So security, infrastructure, DevOps, smart techand we can go pretty broad But we're very stage
specific and when we get involved withcompanies.
So our deal team is structured with people whohave experience and skill sets to really cater

(08:39):
to both the diligence work and assessing aprospect companies and then working with those
companies post investments.
So our deal team today from a ladderperspective is associate VP partner.
There are varying levels of associates anddifferent types of backgrounds within the
associate class.

(09:00):
For us, we have people who are skewing veryheavily towards the diligence side.
So that's like a diligence associate for us.
A lot of those people come from investmentbackgrounds or have some sort of skill set
where they're working on finance teams to do alot of the heavy lifting around.
Okay, we have X amount of prospect companies.
Need to do market calls, work with any data wehave, running a lot of those diligence

(09:24):
processes and modeling.
And then we have on the other side of the aisleis more of the sourcing focus associates.
So people who really can come in with a ventureexperience or not and really kind of come in
with more of a fresh perspective and reallypersonality presence communication style to
work with founders, Do quick reads, not beafraid to set up meetings, dig in, develop a

(09:48):
relationship and develop that trust early on.
So you're kind of stepping away from just thenumbers and getting more interaction with
founders.
So a lot of teams are structured around itdifferently.
For us we have different types of associatesand that's a lot to our focus on our stage and
things like that.
It does in terms of the interview process fromthe diligence side, we have a lot of those

(10:11):
camps put together an actual case studyspecific to we'll give them some data from one
of our portfolio companies, sign an NDA and saywould you make this investment, run the model,
tell us about the business, things like that.
It's really meant to get them kind of workingon paper, talking, put a position in and stand
by it.

(10:31):
And on the sourcing side, we'll do something alittle bit more interactive to say, hey, what
is a company you think we should go invest in?
And obviously we're not looking for them to gofind us the next data dog in that But we want
them to come back and say, hey, you know what?
I really like this space.
Here's why.
Here's a company that I think is trending inthe right direction whether that be headcount

(10:53):
or differentiated product or you've seen othercompanies larger in the industry acquire a lot
of companies.
So really the idea there is to get themtalking, right?
And see if they have the confidence andcommunication style to step in.
So for us, we're looking for a lot of thosethings in our interview process.
When you get to VP, principal partner, otherfunds, the game changes in terms of some of the

(11:17):
skill sets you need to step in.
If you go to an Excel or Sequoia I'm surethey're a little bit deeper into if you're
gonna be focusing on their consumer groupversus their B2B group, their early verse
growth.
So I think when you look at funds like thatthat have gone to a multi fund strategy they're
gonna try and push you into lanes where you'regonna help round out those specific teams.

(11:40):
Whereas other firms whether it be very small orkind of emerging to that level will have
different profiles that they can actually trackthe team to round out what they have and to
bring a full package investment team together.
So it's very different fund to fund.
How far outside of venture have you guys hired?
Have you brought in people from banking,consulting, from product management?

(12:05):
Is there a little bit of open mind?
Because some funds are pretty close mindedwhere they're like, hey, you need to have done
some type of internship or have sourced somedeals.
So it sounds like you guys have a little bit offlexibility and you guys are open to people
from different walks of life.
And those are the three personas that come tomy mind, like product management, consulting,

(12:28):
somebody that's coming from McKinsey, becausethey're usually working with a lot of data
sets, and then possibly somebody from banking.
But any other new types of personas that you'reseeing break into venture and how can people
bridge the gap to kind of get closer to abetter fit?
Yeah, it's a great question.

(12:49):
I think OpenView as well as other funds arelooking for talent in a lot of different ways.
I think you're spot on that it's not just aboutpedigree, getting your three or four year Wall
Street rotation and then stepping into thesethings.
I think there's a lot of great talent out thereand it comes back down to the entrepreneurs
you're gonna be working with and getting peoplearound your team.

(13:11):
So for us in terms of backgrounds if you lookat some people on the team we do have people,
some partners who look at Tom Hollihan.
He came to OpenView I think about two years agonow.
He started his career more on the investmentside actually in a bank, shifted to an operator
role in more of a BD focused role at Datadog.

(13:33):
Did that for some time, went to GeneralCatalyst as an associate but came in with more
of that sourcing capability from having thatsitting time in the seat as an operator working
with teams on the other side of the table andthen has since grown to become a partner over
here at OpenView.
Caitlin Henry, a VP on our team was with Amazonand part of their product groups.

(13:56):
Want the profiles you flagged.
And she brings this whole fresh perspective andjust her ability to connect with entrepreneurs
is different than some people who come fromstrictly finance and look at the numbers.
I think being able to speak to product andspace and look at teams because you were part
of those teams in the past is interesting to alot of funds right now across all levels.

(14:23):
I think for looking at an associate class,naturally you may get a lot of people coming
from investment banks and or consulting groupsthat work with PE firms.
I think for those associate roles becausethey'll have some of that diligence experience
to be able to step in and learn it.
But that being said, we're branching out andfinding different ways to bring in top sourcing

(14:45):
talent.
So for us, one of the new profiles we'vethought through recently is can you go get
someone who's early intact as an operator whocomes from even an AE background or someone
who's really had developed BD or product shopswho've gotten in front of and really can put
their sales hat on.
Because a lot of ventures today is selling yourfirm, your money and making connections.

(15:11):
There's a lot of different ways you can findtop talent.
I think another bucket we're seeing more of arepeople coming from corporate development teams
which is interesting.
So there's a lot of ways you can get into thatwithin a lot of different types of B2B software
companies, but those people are gonna beworking really heavily on the diligence side.

(15:31):
And then you can combine that with a certainpersonality, you can have a really well rounded
investor.
So I think more and more you're gonna seepeople come from different types of
backgrounds.
Operating backgrounds are definitely becomingmore popular.
I did some work with Spark Capital on the WestCoast years ago for their consumer team.

(15:51):
And they were actually for the most partexclusively focusing on people coming from the
operating side.
We can bring that perspective.
I've done some work for Information VenturePartners in Toronto, a small FinTech focused
funds.
They skewed very heavily towards the operatorto round up their team.
I think core of a lot of these flagship funds,they have the top heavy people who've been in

(16:16):
the space a long time with really strongfinance backgrounds.
And now it's about getting kind of fresh talentand with their own perspectives around the
team.
Sure.
Yeah, I mean, point that you mentioned isreally important.
This is something that I've been kind ofadvocating a lot in the last few months.
But to me, really sales is the most importantskill in life.

(16:38):
It's what gets you a job.
Like you said, when you're working withfounders, there's a lot of investors to choose
from.
So how you convince them to take your moneywhen they're over subscribed?
There's been a few deals where I just feltsuper lucky that I even got into the deal and
the founder let me in.
And I just tried to genuinely just build afriendship with them, not even the cliche, can

(17:02):
I be helpful, right?
I mean, that's the meme.
But I really just try to build a friendship.
And I think that's part of sales is likerelationships.
And then I would say some of the best dealsthat I got into is just because another VC told
me about it as a friend.
And I think that relationship building is soimportant because you just won't get into any

(17:23):
deals no matter how quantitative you are or howgreat of a model you build.
If you build a model and you can't even getinto the deal and the people don't like you,
then I think you're kind of handcuffed.
I think that's, I totally agree.
I think that's another persona that's superimportant.

(17:43):
It's the way that you engage with the hiringmanager, the first impression that you make
when you're interviewing, I think that's a bigpiece.
I would also say part of VC and I'd say this issomething that I'm constantly working on is
almost being a media brand.
So I guess how important or how often do youkind of do a Google search the candidates to

(18:07):
see if they've written any blogs?
I guess, is that something that's interestingto you?
And do you think it's helpful for people?
And I guess this is just kind of pointed tosome of the audience.
Do you think they can get some brownie pointsif they have some investment theses or if they
even put together something that's related tokind of the because I think I've seen on your

(18:27):
website, you guys are focused on product ledgrowth.
So maybe looking at their thesis on product ledgrowth and writing an article on that, Do you
think that is helpful in kind of the wholepackage that they put together?
Absolutely.
Yeah, I think that just speaks to someone'sinterest and passion.
I think we've come across some candidates overthe last few months who are extremely

(18:48):
impressive, could clearly step in day one anddo the diligence side or possibly be trained to
source deals.
I think a lot of people don't make it throughto the final rounds in our process.
A lot of it comes back to everyone says culturefit but it's really passionate team at
OpenView.

(19:08):
And a lot of the times in, I think one of thequestions we ask and you'd be shocked at how
people respond to this but what gets youexcited about our stage?
Or talk to me about a company and a lot of themare like, I'm just excited to really work with
founders.
About that?
Why about this stage?
Is this so pivotal to get capital at series Aor B?

(19:31):
Be able to really, you don't have to have allthe right answers around what's going on with
these companies at the time, things like thatbut be able to speak to specific examples of
what gets you excited about company doing that1 to 5,000,000 push and some of the things
they're going through that you like to helpwith or dig into in the business and looking at
the landscape is whether you're junior orsenior as an investor, you're gonna have to

(19:54):
have some level of interest somewhere.
And for us, we cast a wide net across B2B.
So if you say, listen, we've OpenView'sportfolio and see that you invest in a lot of
companies.
I personally have been following FinTech thelast year around everything.
I've gone to these virtual events, I've donethis.
Just to show you're actually passionate aboutsomething goes really deep with the hiring

(20:19):
manager because again, it doesn't mean you haveto identify four great companies for us to go
invest in but we're betting on the fact thatyou're gonna wanna go hustle and find those
companies.
And then actually be passionate when speakingto those companies because you're constantly
around it and you're living and breathing it inyour day to day.

(20:40):
So we had a candidate that got on our radarthrough a blog post.
He had his own perspective on product ledgrowth and that was flagged by one of our
partners and said, Hey, I actually gave this aread and was impressed.
We reached out and engaged with the candidates.
So I think that can certainly help.
It doesn't mean everyone has to go become aprofessional blog writer tomorrow.

(21:04):
But I think even being able to speak to blogs,things you follow, newsletters, what's gonna
get you excited about a space.
That next layer is where you wanna speak to andlive in your kind of interview discussions.
You can never be surface level and get anywherein these processes.
And I think there's a lot of ways now.
I think the bar is just getting higher every, Iwould say six months.

(21:29):
Before it was kind of like, hey, put togetheran investment memo and here's your resume.
But I've seen some people build like thesedashboards tracking different types of trends
in Notion.
And that has replaced like a pitch deck.
Also run an emerging manager program and I gota bunch of docs sends, but there was one person

(21:53):
that sent me a Notion interactive dashboard andI was blown away.
So I think I would not be surprised if somebodyputs together some type of air table.
And it's the same thing, the blog, it's onething to kind of see something just posted like
a couple weeks ago and then no history.
But there's ways for people to actually kind oflive the VC lifestyle and constantly source

(22:18):
deals.
Scout programs.
There's other ways that you can join Angelgroups where you can just kind of source deals
and post them and get feedback.
And I think as you do a Google search on thatperson, you can see the history that they've
been tracking it for a few months.
Then also like you said, just knowing about theevents and where those communities are and

(22:42):
being plugged in, think that's a huge thing aswell.
And having a perspective.
I think that's the thing too.
Don't be afraid to have an opinion and go withit.
It doesn't even have to completely align withan investment thesis with the partner you're
talking to.
I think if that was the case, if everyone hadto agree at any venture firm or OpenView, there

(23:03):
wouldn't be a firm.
And I
don't think any great investments would bemade.
You have to have different perspectives.
You have to have some arguments along the way.
But people here will want you in the room ifyou can back it up and kinda show why you're
interested and be able to speak to things.
It's too competitive right now to get intofirms if you're not passionate about something

(23:25):
and can back it up.
So and again that doesn't mean you have to betwo, three, four years of experience and be
able to speak to everything about FinTech orhealth tech or DevOps.
And it could be multiple things but being ableto point to concrete examples of what you're
following trends, things you're reading, thingsyou've participated in in the space.

(23:48):
That's what jumps out at hiring managers.
It's not just like, hey, it looks like Datadogdid awesome.
Other companies in that space are probablygonna do well too.
I mean, that's obviously an exaggeratingexample but you gotta go deep.
Sure.
Hey, Tim, I think you had a question.
So when you said GMs, what does GM stand for?

(24:08):
General managers?
General manager.
Yeah.
That's right.
Like a general manager background kind ofterritory, whether it's like an Uber or a
Handy, one of those kind of platforms that usesthe GM model.
Absolutely, yeah.
I would look at Sparks Group, Excel on theconsumer side, NEA and their Bay Area teams.

(24:33):
You're gonna see a lot of those backgroundsfrom all different operating functions.
Think that GM GMs are depending on the size ofthe org can sometimes be many CEOs in their
mind how they think, right?
I think you're gonna see all sorts of operatorsgetting to venture.
It's more about the conviction than about whyyou want to get into venture, right?

(24:55):
I think that a lot of people have made thattransition and done very well.
Some of top investors out there were eithermulti time founders, CEOs, or just parts of
great runs.
I think a lot of the Spark team came fromTwitter across and then some of them even early
stage product or design marketing.

(25:15):
Think it's just how you want to positionyourself as an investor developing perspective
on companies from what you've learned as anoperator is your biggest tool there with that
background.
Helpful.
Thanks Steve.
Yeah, that's really helpful.
Any other questions, guys?
What are the questions you guys have?

(25:37):
Maybe about the recruiting process.
I guess how important is the resume?
Is that kind of the standard, I guess whenpeople submit and apply to a position, what are
some of the artifacts that you like to see?
Do you like to see some type of investmentmemo, you know, along with the resume or do you
usually just start with the resume and then,you know, kind of take the conversation a

(26:01):
little more organically after that?
Yeah, I think you're still seeing resumes.
I think that's part of it.
Think most people are on LinkedIn now.
It's going beyond that.
I think a lot of firms are building processesto get to the core of things faster.
So I think you're gonna have steps along theway.
Think being able to send a resume over, getyour background, kind of laying out your story

(26:24):
is important and be able to speak to stopsalong the way.
And think one thing that we tend to always digin on and this is part of having a resume and
just generally how you've looked at yourcareers.
Being able to go back and say okay I did thisand this what got me here.
Even if it was a failed stop, that's fine.

(26:45):
But learnings from that, what made you move tothe next step?
So I think you want to tell the right storybehind where you're going, where you've been
and where you're going is always key.
And that sounds obvious but a lot of peopledon't have to tell their story a lot.
They get on these calls and they're so focusedon the questions specific to the role that when

(27:05):
they're saying like, Hey, tell me aboutyourself.
They get through it in like forty five secondsand sometimes that's a red flag.
You kind of want someone to be able to say,Hey, this is where I've been and to where I got
to right now us talking and why I'm excited isa pretty powerful piece of the interview
process.
So definitely worth having the resume butyou're gonna have a process for us, for example

(27:27):
for our associate process.
We'll do a combination of inbound applicationsas well as outreach and that's gonna be across
a lot of those buckets we discussed.
We'll have a first screen or conversation andreally that first call is just interacting with
the candidate.
Whether it be inbound, outbound, source tosomeone that you wanna talk to to say, hey,

(27:49):
here's our story.
So treat that as informational.
Always have questions around funds.
Digging into like hey what does the team looklike today?
Things like that are always a good sign thatyou're thinking about okay what am I joining
really?
You can get into investment thesis and thingsdown the road but you wanna always show that

(28:10):
you're thinking about your career, how you'reprogressing, what that looks like at a
platform.
Definitely want someone to indicate thatthey're looking for a long term home or I don't
know how you want to define long nowadaysprofessionally but certainly having those right
by signs and early conversations.
From there you'll get into a little bit more ofa formal interview.

(28:31):
For us we have a partner kind of running point.
And in those early discussions you're gonnahave I'm just thinking about actually some of
the questions probably that you might get hitwith.
It's like if you're at a current firm or whatyou're doing, if you're working with deals, was
your role?
If you're looking at a company what got youexcited about it?

(28:53):
What was the leadership team like?
What was exceptional about it?
What were the biggest risks that kept you up atnight?
All these things that kind of get you talkingabout some of the work you're doing day to day
instead of just the I get in, I do this, I dothat.
Like they wanna get into examples of whatyou're doing with actual live examples, case
studies.
So you're gonna get into a lot of that upfrontand then kind of continuously move through the

(29:17):
process to dig into certain things along theway and then always a formal on-site and
typically a case.
Sure.
Yeah, I would say that's a good point.
I mean, I think having live deals that arerelevant.
So the people in our program have beensuccessful.
Some of them that landed jobs because everyMonday we're bringing in deals.
So, it's pretty handy because we have like abacklog of like five to six deals that when

(29:40):
somebody is interviewing, they can kind ofrapid fire and say, hey, this company is great.
It's a $400,000,000,000 market size.
These are the five competitors that they have.
And I know that competitor two is kind of doingthis, but this is still why this company is
going to win.
It should be like a relevant, I feel like itshould be a relevant company that you guys

(30:01):
actually would probably maybe take a secondlook at, right?
And the smart people will do their homework tocater to the fund, right?
So they're not going to bring you guys like alife science deal, right?
It should be something that's related to whatis kind of catered.
And part of that goes back to emotionalintelligence, sales.

(30:21):
If you're going to, I had somebody, and thisjust goes back to just basic sales skills.
I had somebody that was like an emergingmanager that wanted to kind of join my program.
And he was like, Hey, I'm gonna take you tothis awesome steakhouse.
And I luckily eat steak, I eat pork, I ateeverything.
And it sounded great to me, but what if I waslike vegetarian, right?

(30:44):
What if I did not care about steak?
So it's kind of the same thing.
So it's kind of like the sales skills, and theemotional intelligence skills, like kind of
prospecting, understanding, like targeting ofleads, making sure it's a good fit.
I feel like some of those skills are justintangible.
You can't just come in and go directly andexecute on those hard skills.

(31:06):
So I think those are things that you probablyread as well.
And you probably catch that just in the firstcouple of discussions on how thoughtful they
are when they're answering these questions.
Absolutely.
Yeah.
Then we've got another question here.
Tim, it looks like you got a little paragraphhere.
You wanna just rattle that off, that questionyou had?

(31:29):
Yeah, happy to.
Yeah, so Steve, I guess, if you've sort of beendeveloping a resume and a background sort of
with an operating career in mind, and you'rejust trying to make sure that you're putting
your best foot forward for a venture recruiterand really like making sense and framing

(31:52):
everything with that in mind, just thinkingabout that, is your reaction like start from
scratch with that in mind and just completelyredraft, like work with somebody who knows how
to do that or, I guess just talk me through howyou would think about that if you were making

(32:13):
that kind of career switch.
I would beef it out even more on the operatingside to be honest.
I would speak to the skill sets you'vedeveloped there.
I don't think you should try and flag anythingor speak to trying to position it to be more
like investor approach or finance approach.
Think people really value, I would really kindof bake in things of your day to day, not

(32:39):
specific even just to what you're doing rightfor your function but maybe exposure you're
getting to other leadership too.
Like if you're meeting with the CEO or groupheads, cross functional work, that's super
interesting.
So, being an expert in a function or skin thatexperience and then really positioning yourself
as someone who understands how to work in acompany like on the operating side across

(33:01):
multiple teams.
Lot of them don't Like have that.
It's something that sounds simple to you inyour day to day.
Even working with executive teams and newproduct launch and revenue or sales or whatever
it is.
A lot of people sitting in investor seats todaywho came from Just Finance, they don't know

(33:24):
that world.
I would love that and really position that.
That makes a ton of sense.
Thank you.
Cool.
Pauline, you want to go ahead and ask yourquestion?
So Pauline is an investment.
She comes from like an investment bankingbackground.
So it looks like she had some good questionsthere.
You want to go ahead and call that one out?
Yeah, I'm like the quote unquote, the one withthe finance background.

(33:47):
But yeah, I'm just curious in terms of earlystage versus growth stage, do they look for
different skill sets?
Or for people with heavier finance backgroundwould you suggest them to target more of a
growth stage VC?
You'll see both.
I think if you looked at team backgroundsacross early in growth and try to break down

(34:10):
the percentage of people who got into growthfrom finance, it'd probably be more.
I think that's just that stage of investing.
You are betting on entrepreneurs, operators,their story and space but a lot of it is
skewing, starts skew towards the numbers.
So as you kinda hit that series c and beyond dlike that growth equity into private equity,

(34:33):
you're gonna see a lot more finance backgroundsbecause that's a heavy part of the deal flow
and deal process.
But on the same time that still exists inearly.
I think it's just having conviction for whatgets you excited about early.
And a lot of it's back to those things wetalked about in terms of your interest in
space, passion, being able to speak to whatgets you excited about early stage companies.

(34:56):
And I think that for us with these A and Bdeals, the expansion stage which is still on
the early side, you're gonna have enough meaton the bone with these companies, data, revenue
to run a model.
That's still part of it but it's going beyondthat and balancing that with personal
connection to founders, CEOs, thinking throughspaces more strategically.

(35:20):
So I think that it's just more of a blend ofskillset the earlier you go.
And then when you go, I mean, seeds obviously amuch different ballgame but early stage
investing, I don't think you have to limityourself to one versus the other but I think
before you go into interview processes one wayor the other realize what they're gonna be

(35:40):
digging in for.
I think again early they'll really want topress you on do you want to get into this stage
that's gonna be much more hands on withfounders and building.
Yeah.
Going back to the artifacts real quick, whenyou said models, what are some good models for
these guys to warm up on?

(36:01):
We go through some of the financial models.
So going through like the three statementmodel, modeling out kind of how much revenue
they'll have.
We've done a couple like revenue and churnmodels that have been helpful.
And then some cohort analysis, those are somethings that we've looked at.
But any other models that maybe we should brushup on or just be aware of to kind of just be

(36:24):
prepared and especially in the real life,right?
When you guys are working on some of these morelate stage deals, there's more meat on the
bone, as you said, what, you know, any otheradditional, spreadsheets or models that they
should brush up on?
Honestly, those are all great.
So I actually asked that question.
I have not done financial modeling myself.

(36:46):
I come from recurring.
So I can't speak as if I know everything there.
But when I started helping with interviewingcandidates with the investment team, said, Hey,
how hard should I really assess them and pushon the modeling skill sets?
And a lot of the feedback I got was themodeling you can do in venture isn't really as

(37:09):
I don't know if put the right additive on this.
I think some of the models you do with banksand outside of venture actually will probably
be little bit more challenging, little bit morebuilt out.
I think the modeling skills you need to stepinto venture and learn it and kinda grow on
that isn't as complicated as you would think.
So a lot of it is like what you just describedand being able to look at data sets, run the

(37:35):
model, a lot of it around the revenue, lookingat turn rates, things like that.
But a lot of that can be taught.
But I think that you will run models probablymore and over longer periods of time as you get
to later stage investing.
I think that it's just those a lot of deals arestarting earlier.

(37:56):
On the venture side and on the early stageinvesting, a lot of the deals, that the
relationship starts with just this, right?
You're getting to know the founder, team,story, mission, learn about the space, you're
doing some customer calls.
The diligence goes beyond sometimes just thenumbers.
Your market research, talking to customers,figuring out as much as you can about the

(38:16):
space, taking what you can from the data theygave you at one point in the deal typically
towards the end and be able to build a casefor, hey, this company is growing at this rate,
here's where we see them going, etcetera.
As you get towards growth in PE, you're gonnahave much more of that data earlier to go off
of.
So all of these companies are gonna be, I justhad a more mature revenue scale.

(38:39):
So it will vary.
Yeah, that's a good point.
And there's a lot of stuff on the internet thatpeople can download and play.
Some of the best models I'd say I've built havebeen just from scratch.
There was one that I did ad hoc during alecture a couple weeks ago, and it was just
assuming how much the evaluation wouldincrease.

(39:02):
And then also it was the revenue.
So kind of the revenue multiple and then thevaluation, it was really simple math, but it's
kind of cool to kind of lay it out.
So some of the things you can just kind of, youknow, do ad hoc and kind of build some creative
models based on different assumptions.
And to your point, you know, sometimesimaginary numbers.
It's stuff that could potentially happen in thefuture.

(39:23):
And even when you look at valuation, it's papergains.
So it's not real money until there's a realIPO.
That's right.
And you can have your, use like a baseballanalogy, your single double triple home run
kind of modeling where you're saying like, hey,here's worst case, here's likely, here's kind

(39:44):
of the stretch.
You're going to be able to run certain modelsto kind of pitch the company to the investment
committee at your firm, which is a wholedifferent process.
And
I used to be intimidated by it in the beginningand then I started turning into a data nerd.
I started kind of just kind of playing with itand diving in and it's not as bad as you think

(40:06):
in the beginning.
Cool.
So Keith has got a question.
So Keith has some experience at a venturestudio.
So I think that's interesting too, because he'skind of like incubated businesses and then
helped them scale.
So, I thought he had an interesting backgroundas well.
But Keith, I guess you have a question here.
You wanna just shout your question out?

(40:26):
Yeah, so this was actually more about the PLGmodel that you guys are investing And I was
actually wondering, what makes it so crucialfor PLG companies to hit that $10,000,000 mark?
And what exactly changes around that?
And then do you see any limitations around thedifferent industry verticals?

(40:47):
Like you can't exactly put in a PLG model insomething like industrials.
That's a good question.
A lot of companies we invest in naturally areat that stage specific to A to B, one to
10,000,000 ARR.
For us we invest in PLG companies, we invest insome non PLG companies.

(41:10):
I think it's more PLGs really more specific tothe go to market playbook and approach with
your product versus others.
And that's where we're finding is becomingreally just a dynamic playbook in the market to
date.
So you'll see successful PLG companies crossverticals.

(41:33):
And so if you think of Atlassian was probablylike the flagship one.
And I think of Slack even.
Think about how you use Slack, right?
You can use it as a consumer and then you and Istart using it at cause we're chatting during
the day then all of a sudden this whole group'susing it.
And then your group leader says how are guysall talking during the day and then brings it

(41:55):
to your president or CFO to say hey we shouldbe using this as our company communication,
right?
So
it's around the virality in the product.
It effectively sells itself at those earlierstages.
So that's an extreme example, right, withSlack.
And if you look at Calendly, one of ourportfolio companies, I send you my Calendly
link.
Great.

(42:15):
And then you're like, oh, what's Calendly?
So now you're using it and then you're gonna beusing it across multiple invitations, groups of
friends, teams, companies, firms.
What's pivotal in these Procter Growthcompanies is that take a security business like
Snyk or security DevOps but some of theseindustries like industrials or security in

(42:37):
general has been these old school enterpriseselling deals on the golf course sales leaders
and how they approach getting deals and 6figure deals over the finish line with these
customers.
That can still exist.
You can implement product led growth bestpractices earlier in a sales cycle and how you

(42:57):
approach the market.
And really that's just to show value of yourproduct earlier.
So can you get someone in enterprise orenterprise level company to see your product,
do a free trial, kinda like remove the frictionof the sales process as you build up that
account to be a future enterprise levelaccount.
So you're gonna see more old school industriesadopt product led growth habits and strategies

(43:23):
in their go to market and then combine that youhear like land and expand.
So can you get a lower ACV deal contractthrough more product led growth initiatives but
bank on growing that account over time.
Right?
So it's more of a transformational kind ofplayer we're seeing in the market with

(43:43):
companies.
How do you guys get over like the hurdle in thebeginning of all the revenue loss that isn't
happening?
I mean, it's the one thing they're very costefficient in product line growth businesses
because you don't have to go hire 50 sales repsto go close deals.

(44:06):
From an investment standpoint, it's a veryattractive business on paper.
When you look at the financials just becausespend is really around product.
So you're investing engineers, productmanagers.
You want your product to sell itself.
So it needs to be the best experience and yourUX design needs to be really kinda almost

(44:29):
catered to like a consumer approach.
Like you want someone to use it and have it beuser friendly, easy, take seconds.
Right?
So a lot of the companies are focusing on thatand they're actually because they're so capital
efficient.
I think one of the biggest challenges ofproduct like growth businesses like Accountly
is that a lot of the times early on in theirgrowth, they don't need your money.

(44:52):
So it's like, hey, we're doing fine just now.
So you'll see a lot of these PLG companies bebootstrapped for longer because they don't need
to clog up the cap table early.
So it's a really interesting play.
It continues to evolve.
You're gonna see more and more companies do it.
I can send over Joel our product led growth mapLoomiscape which is really interesting.

(45:15):
Again, it's cross vertical.
And if anyone ever wants to talk about it, I'mhappy to chat.
I'll put it in here.
Nice.
Thanks.
You're
seeing a lot of different companies adoptedacross a lot of different verticals.
Oh,
wow.
This is really cool.
Yeah.
This is a really huge, expansive overview.
So this is kind of the whole landscape ofproduct led growth.

(45:35):
This is where Yeah.
And you'll see on the left PLG like maturity.
So a lot of the companies at the top will bepeople who've really adopted product like
growth playbooks, but towards the bottom,they're trying to implement it.
Right?
Where they're putting it into playbooks.
Very interesting.
That's great.
Yeah.
That's really helpful.

(45:55):
Do have any bad examples by any chance, Steve?
Any what?
Any bad examples of product led growthcompanies?
This is being recorded so I don't know if Iwanna Honestly, top of top of mind, I don't

(46:15):
have a specific example.
I think
there
are certainly companies that who may try andadopt PLG in the wrong way.
Like PLG is not easy, right?
Almost Some to your point industries thereneeds to be some component of sales.
If you're gonna go sell to a governmententerprise level customer, very low chance

(46:43):
there may be some frictionless component ofthem just gonna try your product for free and
buying it.
They're used to having these 200 ks, 300 ks ACVdeals brought to them, go through a lot of
hoops, six to eight months sales cycle.
So I think it's, there are companies who do itgreat out of the gate.
And I think that you'll see companies have morechallenges maybe adopting it later maybe

(47:07):
because they didn't lay it into their strategyearlier.
Yeah, and Keith, I think you alluded to it alittle bit in one of your earlier comments.
I mean, if you're trying to build a product ledgrowth company, and you're just burning too
much capital in the beginning, and you're notgetting enough adoption to hit that growth
curve that you need to.
I mean, essentially, it should be sellingitself in the beginning.

(47:30):
The product is just kind of a product that isaddictive.
You share it with all your friends, but ifyou're just not getting to that point, and
you're just burning too much money, you're justgoing to die very fast.
Because it's a freemium model in the beginning.
So I think you kind of hit it a few minutesago, but that's what I would say.
If they're not achieving product like growth,and they're supposed to be a product like

(47:55):
growth company, that's the biggest issue, Iwould say.
Cool.
Alright.
Looks like we so I guess, Steve, we got acouple more questions, and then I think we can
wrap up here if that's cool.
Sounds good.
So Pauline, you got a you had another questionon cold outreach?
Yeah, sorry.
Well, we were supposed to continue with aproduct conversation, but back to recruiting.

(48:19):
Just one quick question on cold reach, becauseI've heard nowadays are more medium and blogs
and obviously like there's more visibilityabout who's hiring and who's not, but in terms
of cold outreach, I've also heard successfulcases where people, you know, send over a CV,
got engaged and then somehow it landed a role.

(48:42):
And I'm curious about like, would you suggestthat would be an approach and then following up
on that for the first tier VCs like Sequoia andor companies like that, is this still very
important to be close to recruiters, close tosome headhunt versus like us applying directly?

(49:07):
Yeah, it's a good question.
I think that cold outreach is definitelybecoming more common.
We had, I think two of our diligence associatecandidates, called Outreach, Inbound, one to
myself, one directly to one of our investmentpartners.
And actually a third now I think of it thatwent one right to our VP.

(49:30):
All kind of had a different approach.
I think to one of our VPs, it was anotheroperator to say, hey, I saw you made the
transition from operating into Venture.
I'd love to chat and kind of put it more as anetworking conversation and then kind of worked
into why obviously the person came prepared towhy they thought OBU was very interesting.
Think used that angle.

(49:51):
The other associate came from more of a financebackground like yourself.
Came which is saying really looking to get intoventure, liked the stage space of the
portfolio.
He actually I think attached one of his modelshe did in the past just to say, hey, I'm
getting much more involved with modeling in myteam in the day to day and want to take that

(50:13):
and move into venture with what I've learned sofar.
The partners are always extremely busy at thesefirms but to get his attention he flipped it to
the team and we followed it.
I don't know if I would go cold outreach maybethe managing partner at Sequoia.
But I think I would kinda go through thegroups, look at people's backgrounds.

(50:37):
I would probably prioritize targeting some ofthe VPs or principals, people who are kind of
in the trenches working with associates intheir day to day and to try and make those
connections.
You can also send someone like a LinkedInrequest and put a note that you wanna connect.
We get inbound a lot and I think more timesthan not we're gonna respond to some degree and

(51:02):
engage.
So I think if you find firms that you'reinterested in, wouldn't hesitate.
That was really helpful.
John, you got a question here.
Sure.
Good to meet you, Steve.
Great feedback.
So one of the questions that I was posingearlier today with to Joe to Joel was about the

(51:31):
blocks, right?
You wanna market yourself.
That's a way of exposing your capabilities,your passion, your abilities, right?
And the question came to, well, how do Idifferentiate myself from all those 7,000,000
people that are out there blogging andproviding their, they're sharing their

(51:58):
thoughts, their expertise.
And I did this with edge computing because Iwanted to write a blog about edge computing.
And I went to Google and I said, Okay, let mesee how many people are writing about the same
thing.
So that was the outcome, 7,000,000 people,7,500,000 people.
So how do I differentiate myself sharinginformation?
And what does an experienced VC look for in ablog?

(52:21):
Obviously, that's going to be part of theassessment whether this candidate is worth
considering based on what he's expressing.
But can you share with me a little bit morewhat would you think is most important in the
blog?
It's a good question.
I've recently done some of my first blog postsand I think OpenView does a great job on the

(52:42):
content side.
So from a talent side of the house, we'regetting more involved in developing content.
I think if you're gonna be someone who's gonnaget more into the blog side of it and looking
to get into venture in general, I think it'sspecific, diving into something specific.
So I think the person, one of the person, oneof the camps we spoke to the blog post, one was

(53:09):
about product led growth and having a uniqueperspective there specifically around one
company.
So making a case there.
So I would try and get as down in the weeds asyou can and make a position.
That's what's gonna get a response.
There's a lot of people blogging about highlevel things and that's probably like the seven
of the seven and a half million people sayingthe same thing over and over again with a few

(53:30):
different words.
I think that in venture you see a lot of peopledo S1 teardowns.
So as different companies that you've beenfollowing a certain space come out with public
filings and you can kinda get your hands onthat information, what are your thoughts on it?
Confluent just filed for an IPO and I sawalready three posts about it from three people

(53:52):
who blog and have a lot of followers all withtheir own perspective on what those numbers
look like.
What's that gonna mean for the space?
And again, I don't think you have to do hoursof digging into it.
Maybe you do but I think it's taking specificexamples of somebody you're responding to
versus being like I'm gonna write a blog abouthealth tech and why that's gonna be moving

(54:14):
forward.
And everyone knows that there's a lot of thingsgoing on with health tech.
So I think it's taking something specific theremaking an argument to it.
That's what will grab someone's attention.
Obviously it's gonna trigger a lot of responsesbecause a lot of people may disagree with you
which is a good thing.
So for us and looking at, back to what wetalked about earlier for candidates, we were
attracted to that.
Someone took a stance on something, had theirown opinion on it and they were able to go deep

(54:38):
on why.
And whether or not that that partner wouldagree with that, their ability to walk through
an argument and then have concrete data to backit up, that jumps out.
I see great feedback.
So you have to be specific and you have tofocus on the argument that you're trying to
make based on that specificity.

(55:01):
The second question I have, which is a veryquick one, and I think some of my fellow
colleagues here have been discussing as well,is how do you differentiate good versus bad
PLGs?
More specific, what is the criteria or thecriterions that you leverage to make the
decision of a go no go?

(55:24):
Go no go.
Oh man, that is a day to day battle in theworld of venture.
So our deals for the gono go, a lot of it iswhere they are in the journey and things we
like to see.
Mean a lot of it sounds obvious.
The people side, you want to have a founderwho's gonna articulate their story the right

(55:47):
way, space, why they got into the space,momentum, like what was differentiated about
the product and where they think they're gonnafit into it, thinking about their addressable
market, do they have a really solid opinion onhow big it is, have they done the actual
research?
A lot of time those things are all there.
Who is that person attracted to the company?
Whether it be like an advisor, who are theyleaning on for advice?

(56:12):
Are they always right in the room?
That's never a good sign.
Wanna see them surround themselves with othergood talent.
If they can't tell their story and attractpeople excited to come follow them in that
story in the company, usually a bad sign.
So at least with the companies we're gettinginvolved with, a lot of them around that 30
person mark headcount across multiple teams.
A lot on the technical side, maybe starting tobuild out the go to market.

(56:35):
Who have you attracted so far to the company?
I think the CEO falls lot on that person orearly executives.
So seeing momentum there, having a clear ideaof what plans they have in place.
So that's all on the people side because a lotof time you are betting on them.
The second is around more of the numbers forPLG I guess specific.

(56:57):
It's a great motion and you can get a lot ofusers quickly which is fantastic.
I think churn comes up.
Like how many of those people or customers orusers are you maintaining month to month?
Because a lot of don't know, depends on thatkind of where they are from a stage perspective

(57:17):
but you can have a lot of users drop, come andgo quickly in these companies because it's so
frictionless to engage.
So you wanna look for the upward trends interms of revenue as well as users and people
using your product, right?
I think Calendly now has millions.
So early days was it users going like this andstaying like this and we're having people

(57:40):
continuing to sign up and use the product thengetting to more advanced parts of the product
and seeing that customer come through thedifferent parts of the journey is key.
I think it's sometimes can be deceiving becauseyou can get so many customers or start to drive
some real growth because of the virality of theproduct.
But is that sustainable?

(58:01):
Are you actually sustaining that growth withboth existing customers and net new customers?
Yeah that was really helpful.
Thank you very much.
Go ahead.
I'm mindful of time.
I guess Steve you have time for one morequestion.
I guess we got one more from Pauline.
Sure.
Cool.

(58:21):
Alright, Pauline.
Oh, no.
That was that was I think you can answer.
I was just out of curiosity.
Yeah.
Do people actually like, VCs or blockersactually pay for SEO or marketing to bump up
their blog posts or get more attention?
I'm just curious purely.
Do VCs or people in general?
Or like bloggers, you know, because you can youcan block

(58:43):
it,
but you know, you're if by the well, at thetime when you're blocking, you're probably
still nobody.
Right?
Like, wanna pay more attention, do people doit?
I'm new to the blogging game.
I know a lot of people are blogging a lot atOpenView now and we have luckily a really,
really strong marketing team producing a lot ofour content and going to ghostwriters or tech

(59:07):
crunch and even a lot on LinkedIn.
I wouldn't sleep on LinkedIn.
People think it's basic, I my profile on there.
There's becoming more and more engagementthere.
I would follow VC PE firms you like.
I would follow their content.
A lot of things that sound to us you wouldimagine like we've had people get in with

(59:29):
interviews and be like, Oh I saw your blog postor saw this.
I followed this.
And a lot of the time these VCs or investmentfirms are producing a lot of really interesting
content in spaces.
I think and down to specific deal partnersthere.
So I would follow that but personal blogging,yeah I'm sure it's getting crazy out there.

(59:50):
I'm sure people are paying.
I found one thing that was also very helpful isthe podcast because I found out a lot of
partners have done some form of interviews andthey're all on podcasts.
While I'm on my I have to promote the Open Viewpodcast.
Blake Bartlett runs it and he has someextremely impressive people there specific to

(01:00:11):
Product Lead Growth.
Came up a lot tonight but anywhere fromfounders to president, Jay Simmons from
Atlassian.
And I mean, you name a product led growthcompany, the top executives who've been on the
podcast.
And digging into not only the story but likewhat made them successful early on when they
got investments, what did they use thatinvestment for, different functions that were

(01:00:32):
built out.
So the OpenView podcast, I'm biased I think isprobably one of the top ones out there.
Sure.
That's great.
Yeah we'll definitely check that out.
We'll pull that up.
But yeah, you're right.
I mean, I think one thing that I would say is,from an SEO perspective, sometimes if you build
your blog, like through your website, it's likea tab of one of your websites.

(01:00:54):
If you're doing SEO on your website in general,I think that should help your blog as well.
Because links kind of tracking back to thesite.
That's kind of my limited knowledge of SEO.
But hey, I know we're over time.
So Steve, thanks so much for being generouswith your time and mentoring us and sticking

(01:01:17):
around with us for the last hour.
So really appreciate it.
And looking forward to hopefully catching youup in Boston or if you come out to New York.
Yeah, absolutely.
My pleasure.
Thank you for having me.
And if anyone ever wants to dive into this inmore detail, please reach out.
I'll give you my email.
I'm always happy to chat.
Alright.