178. The Gen-Z Consumer, Real-Time Health Data, and Persistent Top Fund Returns (Cheryl Cheng)

178. The Gen Z Consumer, Real-Time Health Data, and Persistent Top Fund Returns (Cheryl Cheng)
Nick Moran Angel List

Cheryl Cheng of Blue Run Ventures joins Nick to discuss The Gen Z Consumer, Real-Time Health Data, and Persistent Top Fund Returns. In this episode, we cover:

  • Cheryl’s background in retail marketing and innovation while you were with Clorox and The Sharper Image.
  • How did that lead to your career in venture?On your website it says, “WE HELP ENTREPRENEURS BUILD MAGICAL COMPANIES,”… how specifically do you help?
  • Talk to me about about the Gen-Z folks… this is part of your focus at BRV… what are the high-level characteristics of this coveted consumer segment?
  • Are founders adjusting their approach to tech to better serve this group?
  • How the evolution of mobile apps and real time data has influenced the health and consumer industries?
  • You recently spoke on a panel about acquisitions… can you talk a bit about what it takes to build a company that’s well-positioned for an exit?
  • Talk to me about Equity Summit coming up in January… what is it, what was the genesis and what are you hoping to accomplish?
  • This year Prequin reported that BRV is one of the most consistently high performing firms in venture… I know that you’ve been at this for ten years now at Blue Run… what are some of the key factors that have led to your sustained success?
  • I came across your recent article on succession planning and it had me a bit worried… are you planning leaving the industry anytime soon?

Guest Links:

Key Takeaways:

  1. Being an early stage investor, Cheryl takes the approach of doing a little bit of everything for her founders including the sourcing of candidates, getting their first customers, creating a pipeline for follow on rounds and guidance with product and pricing. 
  2. When interacting with your founders, it is important to understand that the journey of an entrepreneur can be a lonely one therefore providing consistent communication and support on an as needed basis is key.
  3. Part of Blue Run’s strategy is maintaining a small firm along with tapping out at 7-8 boards each partner is on. This allows them to manage portfolio diversity while also giving enough time and attention to each of their startups. 
  4. Gen-Z is the first “mobile native” generation and are not held captive to the large social network platforms like past generations. These characteristics open up a lot of possibilities and a possible platform disruption that will give smaller tech and mobile companies new opportunities. 
  5. Elements of Gen-Z that Cheryl finds most interesting are the non social elements, specifically from a work and productivity perspective. 
  6. When approaching Gen-Z, founders and startups will need to focus on user experience, such as shortening content length, rather than technology because mobile smartphones have been prevalent for many years.
  7. Cheryl believes the more advanced consumer behavior she has seen in China will be significantly comparable to that of Gen-Z. 
  8. An interesting point Cheryl touches on is how pervasive mobile consumer behavior has completely changed the way people experience all walks of life, specifically Gen-Z. Today there are experiences built around being “Instagrammable” that were not present in past generations.
  9. Cheryl see’s huge opportunity focused on normalizing and tracking persistent health data in real time. For the first time with mobile, consistent sensing is available which has the potential to unlock many innovations on how we treat, diagnose and manage our health and specifically chronic diseases.  
  10. The challenges Cheryl predicts for mobile healthcare are first balancing such a large market to then marry that with a scaleable business model, along with some resistance from consumers in the US being asked to pay for their healthcare. 
  11. The key elements to building a company thats well positioned for an exit include…Technology, having a strong engineering team that has built a defensible and unique IP, Growth, having impressive user engagement and Optionality, executing at various levels and stages to create multiple exit options. 
  12. Cheryl talks about the Equity Summit and that it’s goal was to create a an intimate forum for LP’s and female GP’s to discuss trends, investing and specifically venture as a business. 
  13. The importance of building trusted relationships with not only founders but your LP’s and investors as well. 
  14. Key factors that have lead to Blue Run Ventures’ sustained success include exercising constraint in regards to fund size, knowing the firms strengths and weaknesses in order to really focus on adding the most value and understanding key geographies that will implement growth. 
  15. Cheryl thinks about succession planning by building a culture that utilizes the unique skills each person brings to the firm that guarantees the best decision making and execution.