157. Leveraged Growth, the Consumer Echo Chamber & Customer Obsession (Rebecca Kaden)

The Full Ratchet Rebecca Kaden Union Square Ventures

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Rebecca Kaden of Union Square Ventures joins Nick to discuss USV’s Newest GP on Leveraged Growth, Consumer Brand Building & Customer Obsession. In this episode, we address the following questions:

  • I’ve heard you talk about Allbirds, Zullily, and others before, can you highlight a few notable investments from your time at Maveron?
    Previous career as a journalist? Did you write about tech?
  • How’d you end up joining Maveron?
  • Why the move to USV?
  • Fred Wilson said: “Each partner who has joined USV has done two things very well. First, they have figured how to operate inside of our shared investment thesis. And second, they have figured out how to stretch it.”
  • You’ve said: “Next up: exploring the intersection between our core USV thesis around network effects, whether centralized or decentralized and the entrepreneurs building the standout consumer businesses that integrate into our hearts and minds.” Talk about the types of Network effects that you look for and can create large, strong businesses on the consumer-side.
  • Investment Process/Structure at Maveron vs. USV?
  • You often talk a lot about one of my favorite items… customer obsession. It’s well documented on this podcast that I will not invest in founders that aren’t customer obsessed. I’d love to hear your thoughts here and how you test for this characteristic with early-stage founders.
  • What are your thoughts on the role of brand and importance of brand in consumer companies?
  • What are the key elements to building strong brand and can you give us specific examples that you’ve observed in portfolio companies?
  • Thoughts on vertically-integrated brands– strengths and weaknesses, is that critical for a brand w/ a physical good for you to make an investment?
  • What’s your role as investor, are you passive or active; are you coaching and teaching or more of a listener and support? What’s your style?
  • What do you like least about your job?
  • In what ways do woman VCs support and help each other out in this male-dominated industry.
  • Case Study–ย very incomplete information, two companies, early stage, very similar sector and product category, both have exceptional founding teams… one has modest growth rates but exceptional NPS scores, the other has exceptional growth rate but modest NPS.ย  All other things being equal, which one are you more likely to invest in?

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Guest Links:

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Quick Takeaways:

  1. Entrepreneurs should ask how they can create leveraged growth– growth that doesn’t require purchased customers but rather customers do the growth work for you.
  2. There are many approaches and styles that work in venture. Any single firm does not have the ideal approach.
  3. Venture is simply capital and people– and capital is a commodity.
  4. USV focuses on defensible moats and leveraged scale.
  5. Marketing is not a defensible asset.
  6. She likes to meet entrepreneurs before they’re ready for investment. It allows her help the founder and get a better sense for many qualities such as their level of customer obsession.
  7. A way she thinks about brand is to ask the question, “Why do customers care?” The emotion reveals the brand value.
  8. Key element of building brand is consistency. You have a clear message and you tell it over and over again in every channel. This creates an echo chamber and customers reiterate your message.
  9. What she looks for in startups, full stop, is– are you building something that customers love?
  10. If customers really love your product, it’s easier to find more of them than it is to find something to love for your unhappy customers.

Transcribed with AI:

0:03
welcome to the podcast about investing in startups, where existing investors can learn how to get the best deal possible. And those that have never before invested in startups can learn the keys to success from the venture experts. Your host is Nick Moran. And this is the full ratchet

0:22
Welcome back TFR listeners today Rebecca Kaden joins us on the program. Rebecca recently made the move from Mad Ron to Union Square Ventures becoming the first woman general partner at the firm. She’s one of the top consumer experts in venture and she’s here to talk about her approach and her backstory. We discuss her investments in all birds and zoo Lily, her emphasis on brand building. Why customer obsession is critical. Her stance on vertical integration, and we wrap up with what she likes least about her job. Here’s the interview with the incredible Rebecca Kayden of Union Square Ventures.

1:03
Rebecca Kayden joins us today from San Francisco. Rebecca is general partner at Union Square Ventures before joining us v she was a GP at mavar on and before that Rebecca was a journalist for The Economist in London and a Special Projects Editor at narrative. Rebecca, welcome to the show.

1:21
Thank you so much for having me. Yeah, absolutely.

1:24
So I heard you’re moving back to New York City from San Francisco. How was that transition going?

1:30
It’s good. I’m excited about it. Right now. I’m kind of commuting back and forth, which I actually, despite all the travel really like because it’s kind of the best of both worlds. But I’ve been in the Bay Area just about 10 years. And New York City is home. So it’s nice to be able to spend a lot of time there.

1:52
I bet. I bet it’s it’s tough at this time of year we just got in Chicago here. We got eight inches of snow. So

1:59
yeah, this is a week where I feel like I really have the best of both worlds because I spent Monday and Tuesday in New York where it was actually like it was chilly, but it was nice and sunny. I left Tuesday night. It’s been like 70 degrees in San Francisco. And I hear it snowing in New York. So sometimes you really time it right.

2:18
I’m so jealous. My wife and I used to live in Santa Santa Barbara, and she talks about it like every day. Very nice. Yeah, yeah. Okay. So, you know, I’ve heard you talk about a bunch of great consumer brands, and I’m looking at your CrunchBase profile. And you’ve got kind of a who’s who of great emerging consumer brands and tech. Can you talk about can you highlight some of those in your portfolio from your time investing in Matt Ron?

2:43
Yeah, sure. So Matt, Ron focuses exclusively on consumer, but that takes a pretty broad purview of what that means. And so I spent a lot of time in commerce brands like Allbirds, or DIA and CO, but also in, you know, FinTech in consumer health, in marketplaces, and mobile. So you know, Periscope, earnest cover, which is an early insurance company, you know, a pretty broad range that way, consumer health, like modern fertility. And so I really like to think about consumer as How does product and platform create leverage to grow in the next generation of great end user consumer brands? And it’s fun to think about how that plays across different categories.

3:28
Got it? And did you lead deals in in Allbirds? In Zulily? Yes,

3:34
Zulily my partner from Mad Ron Dan, lead, but we it was actually started in the Mad Ron office in Seattle. And yep, led Allbirds which is an awesome, vertically integrated shoe company based in San Francisco. And so they were very fun to work on. Those are really fun ones. Awesome.

3:50
I’m gonna get my wife some kicks for birthday, please.

3:53
New colors out right now. You’re gonna. Awesome.

3:57
I’ll check it out. Okay, so let’s rewind a little bit. You were a journalist. Were you writing about tech? You know, what was? No, what was the focus there?

4:06
So I was a journalist. So I went to college I wanted to write, I loved journalism, I spent a bunch of time while I was in school at different publications, and eventually the economist and kept on with that, when I graduated, moved out to San Francisco to write for, you know, an early publication, a startup out here, focused on publishing online, started on the editorial side editing, you know, that whole side of the world. But pretty quickly, it became clear that the biggest challenge that they were facing, and it was one that really excited me, was how to make money off of content online. How can this be revenue generating and that was a really interesting puzzle. It’s still an interesting puzzle. And it kind of got me to the other side of the house and thinking about, you know, revenue streams and ad networks and all of that, went to business school at Stanford from there, which eventually led me to Mavra And then getting into this venture world.

5:01
Awesome. Awesome. So why? Why USB?

5:06
You know, I had spent about five and a half years at Matt Brown, which is an incredible place and an incredible team. And I really, really loved it and opportunistically got to know the team at USB, and determined that it was a really special group of people and a special kind of group of people. For me, New York played a big role in that. I’m from there, it is a tech ecosystem I believe in. I’m excited about the companies that are being built there. I’m excited about companies being built with the influence of all the other industries going on in New York, and how quickly that ecosystem is rising, and USV is role in it. But most of all, I think, like in any job, it’s largely about the people you’re with. And, you know, I know firsthand how much your mindset is influenced by your partners around the table by how they think by what they think about by what they value. And as I got to know, my, you know, now, partners at USV, I found that it was both very complimentary to what excited me and also would really challenge me and push my thinking. And when I think about the next, you know, hopefully 30 plus years in my career adventure, it was an environment I thought I would really thrive in.

6:12
So, you know, I read Fred’s post after you joined. And he said that each partner who has joined us v has done two things very well. First, they figured out how to operate inside of our shared investment thesis. And second, they figured out how to stretch it. Yeah. How do you think you’re gonna put your Yeah, this was, yeah,

6:32
this was a big one for me. And it was important on both ways, it wasn’t only what USV wanted, you know, I’m, I’m a different kind of character to USB, I’m, you know, 20 years younger. The foreigner, I’ve, I’ve been living on the West Coast. And, and what I love about this team is that, you know, that thrilled them, I think there are people who love different perspectives, and different points of view, and bringing that all together, because we’re so IDM thesis driven. And so, um, you know, I think what I love about the firm is, we’re religious on the values and not on the details. And I think that’s a pretty good way to be in general. And so what are our values, we’re a small partnership, we run small funds, and we’re very thesis and idea driven. But we know that what that thesis is, is going to really evolve and it has in the history of the firm. And so when you think about the history of the firm, it started with this really kind of tight thesis around network effects, and how network effects created the most value and the most defensibility online Yep. Now, that wasn’t only true that was so that not only did it do well, for USB with companies like Twitter, and Tumblr, and that’s the but it also created massive internet monopolies that we believe are very, very hard to beat right now. And that’s the Googles and the Facebook’s of the world, that when you’re that advantaged by data, it’s very hard for new players to beat them. And as a result of that kind of core insight, it expanded our thesis to two to three other things. One is vertical networks, when you’re not playing horizontally, you’re playing vertical. And that led to our thesis in financial services and healthcare, in education. And we’ve done really interesting investments across those buckets. The second is to the infrastructure layer that supports the networks. And there you get MongoDB. And Twilio. The third thing is the results of this aggregation and the need for a decentralized web and a decentralized user experience to give back some of the power that is now lying with these aggregated data players to the users themselves. And try to break that up a bit. And that’s how you get to the thesis around blockchain. What I think I can bring to that, and what what I spent a lot of time talking with my partners on is what have these networks allowed in terms of scaled consumer services and products, because of this infrastructure online. Now, consumer companies can scale in an unprecedented way. And that means both more cost effectively than ever before, and also faster than ever before. And when I look at the portfolio of navaratna, and the stuff I was focused on there, that’s totally evident. These channels are flushed out. It’s also incredibly crowded. There’s a lot of tricky parts to it. But you know, the the kind of core network of these pieces eventually leads to an infrastructure that allows for consumer products and services to scale. And that’s really where I come in and where I’m pushing the needle there. But also, you know, my interests in consumer finance and consumer health are very aligned with stuff that USV has been focused on. So it’s a nice balance of, you know, as you and Fred said, both pushing the the envelope and what the thesis covers as well as fitting well into into the construct we’ve created so

9:41
far. Yeah, you have talked quite a bit about sort of this intersection between yourself and USB with network effects, whether they’re centralized or decentralized. Can you talk more about maybe the types of network effects that you’re looking for, that you think can help create strong businesses On the consumer side? Sure.

10:01
So I think networks are, you know, are traditionally defined on the consumer space largely by social, right? This idea of a of a Facebook or Google where Facebook is the classic example of me adding my friends improves the experience for everyone. And that creates a morality to the, to the service. Yep. But I think we’re seeing network effects and consumer companies in different ways. And it may stretch the definition a little bit. But what it really comes down to is where do you get leveraged growth? Where can you create models where rather than paying for every customer to join, success makes it easier, not harder. And you think about companies like a DIA and CO, or a Stitch Fix where aggregating the data of what people keep from their boxes are like to wear, make that experience better for everyone else, because it improves the algorithms around the selection that you’re sent at home. That’s one core example. Where can you get virality effects and consumer companies and you think about deer, you think about all birds, and those are growing, not by buying customer after customer, but by finding social and viral hooks, where the customers do the work for you and spread the word, either. That’s visual cues, it’s making sharing easy, it’s all of those tactics. But what I really like to think about is how can you create leveraged growth, the kind of that you might have seen in a pure software company, in consumer companies to whether that’s in you know, FinTech or healthcare or commerce.

11:28
So how was the process at mavar? On similar or different than, than the process and sort of the structure at USP

11:35
process in terms of doing deals? Yeah, process

11:39
in terms of, you know, the way that you work with other GPS and other folks at Union Square, you know, how, what’s your cadence? How do you guys review deals? How do you source? I mean, are these process elements similar? Are they different? So?

11:54
It’s an interesting question. I think structurally, actually, it’s quite similar. I think one thing I’ve learned about myself, and my choices reflect it is small teams, small firms, small funds, is a construct, I really like, I like winning not by pure amount of capital you have in your checkbook. But by coming in at the right time seeing things early, convincing entrepreneurs, you’re the right partner, and following through on that value proposition. So from a fun side, and a partnership says they’re almost identical, which is kind of interesting. They’re also both quite focused mavar on is quite focused on consumer, USB is quite focused on our thesis. And so those are things that, you know, whether by design, or by default, I’ve come to really value in venture and think really works. For me, I think an interesting thing about venture is, you know, all the evidence shows many different models work, it’s very hard to say what the right answer is, different models of funds work, different sizes, work, different styles of partnerships work, right, some partnerships are completely consensus driven, you all have to agree, some are conviction driven, where anyone can stand up and do a deal. I don’t think there’s clear data on what works, I think the most important thing is you have conviction around the style you’re going after, and you have a partnership that has trust in each other and is cohesive and functional. And I think actually quite luckily, both versions I’ve been at exhibit that really, really well. So kind of structurally, it’s quite similar. Pace wise, it’s pretty similar, right? Like, do I’m gonna lead two to four series eight deals a year, focus largely on same stage, I think where it comes different is just all venture is is capital and people. And when you change, you know, capital is a commodity. And so when you change the people quotient, you’re just influenced in different ways. And I think the best partnerships both continually push each other’s thinking. So people are, you know, have their own ideas they can bring to the table, but you’re also influenced by the people around you and how they think too. And I found that it USV I think USB thinks about defensibility and moats in a very specific way. I think my partners think about leverage scale and using marketing very selectively. That marketing isn’t a defensible asset. It’s something that I find quite interesting. And I think I, you know, one thing I really love about the USB investors is they’re very bold, they’re not scared, they lean into their convictions and ideas, they know you’re not going to win every time at venture at you got to kind of play big to, to win at all. And and you do that in a risk adjusted way where we try to get in quite early, you know, our initial checks are often quite small. And then we double down from there and stay with the entrepreneurs through the journey. And I really liked that model a lot.

14:43
Awesome. You know, you’ve talked a lot about one of my favorite items, which is customer obsession. It’s well documented on the podcast that I will not invest in founders that aren’t customer obsessed. Hey, I’d love to hear your thoughts here in sort of how you test for these characteristics with early stage founders.

15:05
It’s a really interesting question, I totally agree with you, I won’t invest in founders that aren’t customer obsessed either. Because I think that is a asset that lets you navigate waters that are continually going to change and evolve. And, you know, moving landscape, if you stay really in touch with that customer, if you can get inside who they are, how they think, what they care about, not only demographics, but psychographics. And if that’s really internal to who you are, as a founder, and as an entrepreneur, it’s going to give you a massive advantage when times get harder. So I’m totally with you there. I don’t think there’s a golden ticket question to that, you know, what are you gonna, like? Are you obsessed with your customer who’s gonna say no to that be? The only way I think you can kind of get a sense of that, as well as get a sense of many of the most important things with entrepreneurs in the earliest days is with time. And with time spent with with companies and with founders, and this is something that’s really important to me. Like most other VCs, I’ve been under a pressure cooker clock, I’ve seen a deal that I think is awesome. I have, you know, ran ran ran to get it done in a quick timeline. And some of them have turned out well, but it’s not my preferable way to go. I think when you have the interest of time when you can get to know a founder early, maybe earlier than you would even invest. And when you can make that worth their while because you try to help along the way you give feedback, you give ideas, you give candidates for positions, you give connections to people that might be able to help them. And you can build that relationship over time and not make it a one way street where they’re always coming and pitching you. But where you can make it a two way dialogue where you’re really you’re in it, to help them and to prove to them that you’re going to be the best partner for them. I think not only does that position you better to win a deal. It also gives you a way better insight into how they think, what they care about what they prioritize what they actually do, not only what they say. And that’s where I think you get the best sense of whether someone’s really customer obsessed, awesome,

17:02
awesome. Couldn’t agree more. I feel like it’s one of these Keystone principles with entrepreneurs that if they have it, it just, you know, it permeates every element of the business and just improves, you know, the relationships with customers and the product. Yeah. So I want to talk a little bit about brand. What are your thoughts on the role of brand and the importance of brand in consumer companies?

17:27
I can’t think of a of a breakout consumer company that doesn’t have a strong brand. And that doesn’t mean that brands are all defined the same way. And I think one of the most interesting questions, you know, Matt Brown, we talked a lot about brands, I got to USV, it was less part of the kind of internal dialogue. And that’s not because they don’t know about them. They’ve done lots of great brands, they just think about them in a different way. And I learned that brands, the word brand can get a bad rap. Some people associate it with kind of marketing, smoke and mirrors, right, like, what’s your name? How do you tell the story? But the coolant I’ve drank around brand and how I think about it is what is the emotion? Why do customers care? You have a product, you can sell it, you have channels, you have a team, but why do they care? Why does it integrate into their life? Why do they remember it when they’re off to their other thing? How are they going to talk about it with their friends. And those are the elements that stand the test of time of a company, that mean that you’re building something that’s going to be able to gain momentum, that’s going to matter to someone not to sell to someone. And I don’t know how to build a breakout company without those elements. And that’s what I think defines great brands. When you think about the brand of Nike or the brand of Starbucks, they stand for emotional qualities, comfort, consistency, reliability. And I think consumers, consumers don’t fall in love with technology they fall in love with with the way technology makes them feel the way that technology enables them to do something they couldn’t do before. And that’s the emotional qualities of brands. What

18:59
are some of the key elements to building strong brands? Do you have examples maybe from your portfolio or investments you’ve made in the past? Or, you know, tactics that you’ve observed in portfolio companies have ways that they went about creating strong brands? Sure.

19:16
So I think there are two parts to your question there. One is examples of what goes into great brands, and then how do you build those. So let’s take an example in DIA and CO D and CO is a plus size retailer based in New York City is growing extremely quickly run by two absolutely fantastic founders. They’re Nadia and Lydia. And I think you know the story of Dia Co is the the plus size market is, you know, about 16 or 17% of retail and about 65 to 70% of women. And so what you had was a customer who was scrolling Instagram for years and years, actually trying to buy stuff and not being serve the product. And so to get came along and built them a platform that could deliver them products that they would love. And that was really made for them. And the brand that they built is, we got you. You’re awesome. You’re a cool you can get you deserve the same. You don’t deserve to kind of crawl through the internet looking for stuff you can wear, you deserve to be served awesome fashion things that you’re going to love. And we got you. Yeah. And so that’s what the brand they did. How do you do that? I think one key element of brand building is consistency. You have a really clear sharp message and you tell it over and over and over in every channel. My favorite example here is Allbirds Allbirds, bakes footwear, it started the first product was a merino wool running runner, kind of a casual sneaker. And there were lots of pieces to the story. When I first met Joey and Tim, who were the founders of Allbirds. It was sustainable material. It was comfortable, you can machine wash it, the wool came from New Zealand and it had a cool origin story, it was breathable, all these kind of great things. And they spent a lot of time in early days boiling that down and saying all of these things matter. There are going to be customers who love it, it’s sustainable, there are going to be customers that love the origin story. But all we’re going to talk about at the beginning is how comfortable this shoe is. And that wasn’t random, they didn’t choose it out of nowhere, they chose it because when you study footwear, you find that comfort driven footwear is the biggest indicator of breakout brands over and over if you think about mugs and Crocs and Toms. But it also let them build a brand by narrowing that message segment down to one and hammering it home over and over and over every channel, every Instagram post every press article. And what happens then is that’s what your customers talk about, too. So someone is wearing them on the street, and their friend asked them about them. And they say, Oh, they’re the most comfortable shoe. And you create an echo chamber where you associate this quality with that product. And that really amplifies the brand. And I think the best brands are very, very diligent. That’s not magic. That’s process and they’re very good at putting that process in early.

22:03
Awesome. Is Allbirds vertically integrated? Sounds like they are Yeah, they are? Is that something you look for when when it comes to physical goods? You know, consumer branded physical goods, are you looking for vertical integration and or not?

22:18
Not necessarily, I think actually, you know, Allbirds is a little bit of an exception to the norm. I think, in general of all the categories right now, I’m single product vertically integrated brands is probably not the one I’m most excited about. And that’s not because I don’t think brands can be awesome and cool. And you can grow them. But because they’re becoming I think harder not easier to do as venture models for a few reasons. The biggest is Amazon, Amazon owning 50% Plus online spend at the end of the year makes them a real giant in the room, and I think creates this interesting dynamic where they own a lot and they are increasingly owning products themselves as they as their private label, business expands, and then everything else is getting quite fragmented. Where to build that authentic brand, you have to take a very small slice of the market and go deep in it. And sometimes you can get lucky and get something really big, or you can have a team that’s so good to power through that. And I put all birds in that category, as well as some others everlean. But oftentimes, you wind up with something that’s a powerful brand and a lovely product, and doesn’t scale in the same way that you could when had more open space at the same time channels for the paid marketing side, which a lot of those brands rely on are getting extremely crowded and expensive. And so that’s probably not the category that I’m the most excited about. Now we’ll continue to look, I wouldn’t say we wouldn’t do any of them. Because I do think there’s exceptions to every rule. And I think commerce brands will continue to be created. And I think there’s some categories that lend themselves well, beauty being one of them. But in general, I think supply chain and vertical integration is getting easier to set up more commoditized over time, less of a distinguished advantage. And so I’m actually more interested now and in commerce platforms that are going to play a different game than Amazon what might look like entertainment might look like fun, what might look like experience but actually be a transactional brand. You think about hush and the beauty space or wish or some of those? And how do they get advantages of scale?

24:15
Got it. Got it. So I interview a lot of investors and everyone’s got different styles, you know, some are very active and they want to coach and they want to teach and some are more passive. They want to listen they want to support. How would you describe your style?

24:32
You know, it’s an interesting question i i found that the only style I can have is me, and that I have done less well when I’ve tried to mirror other people’s styles and, you know, look at the most successful VCs of history and try to be like them, including some of my partners and more when I think about what’s authentic to me. And that’s advice I got really early and I think it’s true. I think there’s a lot of ways to play this aiming to be a great investor, and the most important thing you can do is find what’s going to feel authentic and early days, and lean into that. And for me, that’s authentic relationships, getting to know founders early helping in any way I can. I think of myself less as a, you know, coach of let me tell you what I think you should do. And more. Listen, I spent all my time thinking horizontally, right, looking at trends, looking at how sectors are developing, looking at so many companies in this space. You as an entrepreneur spent all of your time thinking extremely vertically on the thing you’re focused on today, the company or building a product that you’re creating, with our powers combined with with how I think horizontally you think vertically, I think we can make each other better. I think that I can add value and perspective that you may not have, and I’m gonna work my ass off to do it, I’m going to help you fill every role that you need to fill, I’m going to help you think through the problems. And if I’m not the best person to know the answers, I’m going to help you find the person that is and be that real node in a network for you. And that’s authentic to who I am. And for the entrepreneurs that I’ve worked with seems to resonate. Well.

26:06
It’s great. So I’m gonna put you on the spot here. What what do you like least about your job?

26:12
Oh, man, I like what you said. I don’t know that. I mean, everyone has things I don’t like about the drop. Listen, I travel all the time. And I think, you know, that can wear on you for sure. And I think that’s by nature of the job, I don’t really think that’s my commuting, I’m a big believer of a deal is interesting, get on a plane tomorrow and go see it. meet people where they are, you know, this is a job where when done best you’re you’re selling you’re not buying and never forget that. And you know, live the lifestyle that reflects that. And when you have to balance that with kind of mental sanity and in a in your life. And you know, you definitely can can wear yourself thin in it, I think. And there’s high ambiguity, I think I didn’t even know how comfortable with ambiguity, I could be as a person until I got into venture. And even for the people with the highest comfort level to ambiguity, it tests them because feedback cycles are long, and you can’t count any chickens before they hatch. And, you know, you’re fundamentally always on the outside as close as you aren’t entrepreneurs as much as you help. It’s not your company to build. And I think it’s important to remember that and so your success is dependent, really on the people who you put, you know, both capital and faith behind. And while that’s really exciting and a privilege, it’s it can be stressful.

27:32
Yeah. Yeah, for sure. Yeah, lots of ambiguity in this job. It’s not a whole lot of time for boredom. No. Well, hopefully boom can get their supersonic jets going from New York, San Francisco, so that your your commute? I would love that. Cool. Um, in what ways? Do you’ve talked about women and sort of how women are supportive and VC? In what ways do women and and established VCs help support each other in such a male dominated industry?

28:04
Yeah, so you know, this is a hot topic lately, and something that I’ve talked a lot about? And, you know, look, I think it’s a double edged sword. I think there are not enough women in VC, there is no other way to say that. I think it is a problem that falls on all of us to fix. And it’s not to fix only for because it’s the right thing to do. It’s to fix for we’re all economically motivated, and it will improve the outcomes of our industry as well. Yeah. You know, women are some of the most talented at starting companies, no doubt more women will get funded and more women are around venture tables. This is a problem with with an economic result as much as a kind of moral one. And I And I’m committed to help solving that. And I and we have a lot of initiatives going on to try to do so which I’m really excited about. There is no silver bullet, it’s gonna take time. But I’m actually quite optimistic with how it’s trending right now. And the tension on the issue. The other side of the coin that I like to point out, because I think it’s important is, while women don’t have the numbers and ventures that we should, the quality of women in this industry is insanely high. And that’s partly because the bar for them getting in has been higher. But one of the greatest joys for me in my job. And one of the things that’s helped me succeed professionally the most is a community of women VCs, who are phenomenal mentors and phenomenal investors. And so to be a part of that actually makes me sometimes feel like I have a leg up in the industry, because I have this secret weapon of this kind of crew of people around me who are determined not only to win themselves, but to help each other and to help the industry get better. And I think that’s a really special thing. Awesome,

29:42
awesome. Well, I liked Fred and some of your your other partners comments about how they made the best choice and it just so happened that they got more diverse in the process. So absolutely.

29:53
And I think a lot of firms are trying to do that and I applaud that and Do you know what we’re trying to do as a group of women GPS is to take away any possibility that people can say there is no pipeline like you don’t know a VC that you should consider hiring, we do so come to us, we’ll help you find them. Because there are so many talented women out there who are are would be phenomenal investors, and I’m really excited to see them get into the space.

30:21
Awesome. So I want to give you a quick little case study. Sure, it’d be an imperfect question with very incomplete information. But let’s say you’ve got two companies, the early stage very similar sectors and product categories. Both have exceptional founding teams. One’s got modest growth rates, but really exceptional NPS scores. The other has exceptional growth rate, but really modest NPS scores. All All else being equal, which one are you more likely to invest in? How much money have they interest, same amount of money, everything’s equal. And it’s right in your sweet spot from a stage standpoint.

30:57
So the obvious answer to me is the higher NPS lower growth. And I actually I talked about this a lot with founders, to me. And look, once you’re in my portfolio, I, I think, you know, you have to be honest about how other VCs are going to view you and the importance of growth to getting future funding rounds done. But to me, what I look for full stop is, are you building something customers love? Yeah, does it matter to them? Because I will take the bet every single time that if you have built something that customers really love, it’s going to be easier to find more customers that look like those people than it is to take more customers. But we don’t know if they really love our product or not, and try to figure out something that they’re really going to love. And so by far, the most important thing to me is consumer obsession and the evidence of that and the numbers. And that’s, you know, NPs but it’s also, you know, repeat retention and referral are the biggest things that matter to me in early days, on the customer side, and we’re going to spend a lot more time on that than we are on growth rate in early days.

32:03
Rebecca, if we could cover any topic here on the program, What topic do you think should be addressed? And who would you like to hear speak about it?

32:10
I actually think really the nitty gritty of recruiting great teams, and what does it mean to hire well, and fast and early is an awesome topic that’s actually not really spoken about in detail. Enough. And Katrina lake would be awesome to speak about that. Awesome,

32:24
awesome. That is a good topic. What investor has influenced you most and why?

32:32
I’m probably Dan Levitan, who started and Oberon. He hired me. I think stylistically I admire a lot of what he does and how he works with entrepreneurs and the level of trust he’s able to engender there. And he takes both firm building mentorship and investing seriously. And, you know, even when I’m on a different team, and inspired by such amazing partners at USB, I still turned to him a lot for advice and the someone I really admire, it’s

33:01
great. And then finally, just to wrap up, what’s the best way for listeners to connect with you? Um,

33:05
I’m very accessible. I’m all over LinkedIn. I’m on Twitter as Rebecca K 46. You can email me at rebecca@usp.com. So it’s hard to miss me. She

33:17
is Rebecca Kayden, the newest general partner at Union Square Ventures, Rebecca, this has been a huge pleasure. Thanks so much for spending the time and thank you for connecting again soon. All right, thanks so much. All right. Thanks, Rebecca.

33:34
All right, that’ll wrap up today’s interview. If you enjoyed the episode or a previous one, let the guests know about it. Share your thoughts on social or shoot him an email. Let them know what particularly resonated with you. I can’t tell you how much I appreciate that. Some of the smartest folks in venture are willing to take the time and share their insights with us. If you feel the same, a compliment goes a long way. Okay, that’s a wrap for today. Until next time, remember to over prepare, choose carefully and invest confidently thanks so much for listening