Powered by RedCircle
Jessy Wu discusses the importance of having the confidence to speak up and share your opinions. She shares that her confidence comes from being deeply loved and supported by her parents, which instilled in her a strong sense of self-worth. She also discusses the role of building a personal brand as a small fund and how being a lightning rod for certain conversations can align with a fund’s strategy.
About The Guest(s)
Jessy Wu is an investor at Afterwork Ventures. She is known for her bold and thought-provoking insights on social media and is passionate about supporting early-stage companies.
- Confidence comes from a strong sense of self-worth and being supported by loved ones.
- Building a personal brand as a small fund can help differentiate and create a unique value proposition.
- Being a lightning rod for certain conversations can attract attention and align with a fund’s strategy.
- “I’ve never felt like an imposter or like I didn’t deserve to have a seat at the table.” – Jessy Wu
- “There is a way to be known for something as a small fund and have an active reason for someone to want you on their cap table.” – Jessy Wu
This transcript has been A.I. generated.
0:00:00 – (Maxine Minter): Okay.
0:00:00 – (Cheryl Mack): Three, two, one. Hey, I’m Cheryl.
0:00:04 – (Maxine Minter): I’m Maxine.
0:00:05 – (Cheryl Mack): This is first check part of Day One, the network dedicated to founders, operators and investors.
0:00:09 – (Maxine Minter): If you want to be a better early stage investor, this is the show for you.
0:00:12 – (Cheryl Mack): So TLDR, if you don’t want to suck at investing, listen up. Today we have Jessie, who is one of my favorite investors in the world, who also happens to be at Afterwork Ventures, where I’m also an LP. Full disclosure, so really excited to have her here today. One of the things I love about Jessie is, know, every time I open my LinkedIn or my get, if it’s Twitter, it tends to be something I laugh out loud at.
0:00:45 – (Cheryl Mack): If it’s LinkedIn, it’s like, I’m going to learn something today and I’m probably going to be impressed that she has spoken up about this thing and slightly nervous because she has the balls that I just simply do not. And I get nervous on her behalf that like, how can she say this?
0:01:02 – (Maxine Minter): It’s so impressive.
0:01:03 – (Cheryl Mack): It’s so impressive. I think we want to jump into, like, how did this happen for you and how can some of us pick up just a little bit of that extra bravery that you have?
0:01:13 – (Jessy Wu): Firstly, that’s very kind, Cheryl, and I’m glad I provide that intermittent entertainment for you. I think there’s probably two ways to answer this. First is how do I, as an individual, kind of have the cajones, as they say, to be bold and wade into certain conversations? And then what is the role of building a personal brand as a small fund? So coming at it from a challenger brand angle and where kind of having share of voice by being somebody who’s willing to kind of be a lightning rod for certain kinds of conversations can actually be aligned to a fund strategy. So the kind of reason behind the.
0:01:56 – (Cheryl Mack): Rhyme, as you will, there’s reason behind what you do.
0:02:00 – (Maxine Minter): Yeah. I also want to celebrate. We are now Two from two cojones have been mentioned on two from two episodes. Maybe we should make this a rule. Maybe we should require cajones are mentioned on every single episode we do here on out.
0:02:14 – (Jessy Wu): Yeah. It can be one of your repeat questions, like how Patrick O’Shaughnessy always asks, what’s the kindest thing anyone has ever done for you? It can be like, I love that. What’s the big cojones moment you’ve had that you’re most proud of or something?
0:02:30 – (Cheryl Mack): Yes.
0:02:31 – (Maxine Minter): Okay.
0:02:31 – (Cheryl Mack): Thank you, Jessie.
0:02:32 – (Maxine Minter): Oh, my gosh. Amazing. Yes.
0:02:34 – (Cheryl Mack): We’re going to have a little bit of Jesse in our podcast from now on.
0:02:37 – (Jessy Wu): Love that. So where do my cajones come from? I’ve been reflecting on this and I think the most honest answer I can give is that I was just really deeply loved by my parents as a child.
0:02:49 – (Cheryl Mack): Wow.
0:02:49 – (Maxine Minter): Love that.
0:02:50 – (Cheryl Mack): And they sometimes listen to my podcasts, hello, Jesse’s parents.
0:02:56 – (Jessy Wu): But I think they just always thought the world of me and thought that I could do anything. And I think that really instilled in me a very unshakable sense of self worth from early on in my life, so that even as there’s slings and arrows along the way, I think I’ve never been particularly insecure. I’ve never felt like an impostor or like I didn’t deserve to have a seat at the table. And I think I’ve always felt that I am well intentioned and come from a place of self awareness and reflection such that I can kind of back myself in to kind of be led by my intuition to make some calls.
0:03:38 – (Jessy Wu): And when people say, oh, how do you have the confidence that you have the right to be heard? And it’s like, because my mum told me I did, that just really is what’s at the bottom of it.
0:03:51 – (Maxine Minter): That is such an interesting angle. Right? I think that is such an interesting question that you are implicitly being asked, which is, why do you think you have the right to be heard? Why are we even asking that?
0:04:03 – (Jessy Wu): Yeah, what is it like for you, Maxine? Because you’re also somebody who isn’t afraid to stand up for what you believe in. Where does it come from for you?
0:04:13 – (Maxine Minter): I honestly think it is the same in that my mum told me I had the right to be heard. I’m not sure that I have the same level of bravery that you do, to be honest. I think you and I have talked about this a lot, right? There are definitely some moments where I dip my toes in and then, OOH, freak out that water’s too cold. But I think it is a fundamental belief that on some topics, I feel like I have the right to be heard. And I think you phrasing it like that was just true.
0:04:46 – (Maxine Minter): Jesse Forbes just like, crystallized the inside of, like, why are we even asking that question? Why are we asking the question that you have the right to be heard? You have the right to be heard because you have an opinion on it and people want to hear your opinion. You can always share your opinion. If people don’t want to hear it, great, but that doesn’t mean you don’t have the right to share it.
0:05:03 – (Cheryl Mack): Yeah, it makes me wonder, why are we asking others that? Why are we asking that question of other people when the reality is that anyone who wants to play in this space, who has a vested interest, should be able to voice their opinion, whether it’s agreed with or not, and let’s champion that rather than ask.
0:05:22 – (Jessy Wu): Yeah, I think, and this takes me to the second part of the point, that people do perceive that there is a lot of downside to being the person who sticks their head above the parapet and that if you’re a lightning rod for a conversation, you can also get burnt to a crisp right. I think for me that there is certainly guardrails I’ve put around how I do that because I acknowledge I’m not just a kind of agent, I’m also a principal, I also represent the fund that I work for.
0:05:55 – (Jessy Wu): But I think that there is a way to as a small fund that the point of departure is that no one has heard of you. You’re not a preferred investor for anyone. You are just money. And if you’re quick money, that’s good, if you’re not money, that’s suspicious in any way, that’s good. But how do you actually mean something to someone so that people have an active reason to want you to be on their cap table because it says something about them as a company or because you’re the kind of person who they want to associate themselves with and who they want to work with.
0:06:33 – (Jessy Wu): And I think that when you’re coming from nothing, you can take a lot of risks, right? And I think that’s why you see challenger brands like who gives a crap for example, take a lot of risk in the early days with the founder Simon sitting on a toilet for 48 hours to kind of get a crowdraise campaign away and people would be like oh, that’s so unprofessional, it’s so crude. He’s like got his pants down, he’s not a CEO, but he really had nothing to lose because he wasn’t really the CEO of a large company at that point anyway.
0:07:11 – (Jessy Wu): But a lot to gain from being at the center point of a conversation, from being noteworthy, from starting a conversation about equality of access to hygiene and water and that brand has obviously gone on a really good trajectory. So I think that as a Challenger brand, you kind of can’t also be an also ran, because if you’re coming in into an industry where there are brands that are very established and in VC that looks like the big three funds which have been around for over ten years and have a very successful track record and have a big brand and marketing and community team.
0:07:53 – (Jessy Wu): You kind of can’t just be a smaller version of those. You have to zeke a little bit where others zag to be known as something and for there to be an active reason why someone might prefer a first check from a small fund like the ones that we run from one of the big three. So I think there is also a lot of upside to being known for something rather than I think that’s the.
0:08:22 – (Maxine Minter): Wonderful thing about our ecosystem. Yeah, first of all, I love how intentional it is, right? I love that you are true to brand. You are really thoughtful in the way that you are challenging. It’s not just kind of like throwing stones. There is a strategy behind it. And I think that the great thing about our ecosystem and being a great investor is that in theory you have to be contrarian and right like the big returns come from having a different perspective. And I think that’s what’s interesting about your opinion, definitely is that you very frequently are contrarian and prove out to be right.
0:09:01 – (Maxine Minter): I think bravery is an element here, but even as a small fund, a challenger brand, in your framing, you can come in and see options and see opportunities people don’t see. And then be that in content, be that in your observations of the market around you or the ecosystem around you or on particular companies and developing, making it clear that your brain is excellent in that way, to bring you onto cap tables and to support the founders that you work for, I think is really awesome to see.
0:09:34 – (Jessy Wu): Yeah, thanks for saying that, Maxine. It’s too early to tell the results, but no, that’s true.
0:09:40 – (Maxine Minter): We’re all just hanging out here with incomplete data. Is this working?
0:09:44 – (Cheryl Mack): Yeah, we were just talking about how investing has one of the most brutal feedback cycles, so we’ll see what happens in the next five to ten years. But on that topic, one of the things that I think after work in particular and yourself have been a champion for, is that like e commerce and consumer brand investing where we just don’t see other investors, particularly in Australia, making some of those bets.
0:10:08 – (Cheryl Mack): Does the content thing factor into that or is this just like a whole other category where you feel that there is contrarian thinking that can get better returns?
0:10:18 – (Jessy Wu): Yeah, for sure. So I think how we think about brand for us is aligned with how we think that fantastic D to C companies might think about brand. And I think it’s all about trying to have a larger share of voice than you have kind of share of wallet or in our case something like funds under management or FTE or something like that. And I think that the way you can shortcut to that is when you have a really distinctive brand that comes to mean a whole bunch of things that are larger than itself.
0:10:50 – (Jessy Wu): So I’ve recently written about the really great brands that have gotten fantastic acquisition outcomes from global kind of PE funds. And that’s ASOP which got acquired for 3.7 billion by L’Oreal. And more recently, Zimmerman, which fielded a $1.75 billion acquisition offer from Advent International, which is a very savvy global PE investor that has invested in things like Lululemon. And did so at the point in time where they really catapulted athleisure into the forefront as a category and rode its popularity to success.
0:11:29 – (Jessy Wu): And what do we think that those really great brands have in common and how do they therefore command that pricing premium? I think that it comes from firstly having a really distinctive product that is able to do its own marketing. So Asop’s brown Apothecary bottles instantly recognizable even some of its scents like the botanical geranium vibe, it’s like you can almost recognize some scents ASOP when you smell them on people’s hands.
0:12:04 – (Jessy Wu): And then Zimmerman, it’s the kind of frilly chill silk, really high quality, but also just like really playful, fun, feminine aesthetic. And when you have really distinctive products, those products that people are proud to put in their homes and wear those products, do their own marketing, right? Like real estate agents go and buy ASOP to put it into open homes to try and create an Aspirational vibe. ASOP isn’t like doing an affiliate partnership with real estate agents. They’re going and spending $40 on hand soap to stage these homes. And then people are wearing Zimmerman to their most special occasions, 21st graduations galas. And then they’re taking lots of beautiful photos and posting them all over social media.
0:12:52 – (Jessy Wu): And because it’s so distinctively recognizable as Zimmerman as well, it just creates so many associations of Zimmerman with something that is playful, but also something that is elevated and for special occasions and makes people feel really powerful and beautiful. And all of that is kind of free for those brands. Like, it’s not performance marketing, it’s not even buying billboards, it’s just getting their users to generate the content that markets it.
0:13:21 – (Jessy Wu): And I think that perpetuates one, like pricing power. So the margins on these products are probably absolutely insane, right? Like $40 for hand soap. That’s ten times more than hand soap at the supermarket. And even that has got a pretty large margin because it’s 99% water, right? And Zimmerman like $1,000 dresses. But it’ll be the thing that people see as an investment or a collector’s item. So they’re willing to really have that be their one big splurge for the year.
0:13:53 – (Jessy Wu): And then two. It’s, I guess like we would maybe call it something like customer acquisition cost when you have so many free marketing channels because it’s UGC driven, that can really reduce how much you have to spend on performance, marketing and sales and promos and how much you have to pay retailers because it’s not you begging DJs to put Zimmerman as part of their lineup. They need Zimmerman to anchor that store so that people come in.
0:14:20 – (Jessy Wu): So I think for us that there is real power to use the Hamilton Seven Powers framework in these really beautiful brands and there is a kind of acquisition flywheel as well. And because of those two things, you can get gross margins that resemble something like SaaS and you can also build merts around that in a way that somebody who just starts selling $40 hand soap in brown bottles isn’t going to be able to do.
0:14:50 – (Jessy Wu): So I think that there’s more resemblance between these kinds of companies and our traditional VC companies than people might realize. But they are also really exceptional. They’re not just another ecommerce company, they’re certainly not a drop shipper. But I think that there is a path to be treaded to build a fantastic company in those lanes.
0:15:12 – (Maxine Minter): So interesting, when you are developing one of these theories, or like, developing one of these insights, what is your path to it? I e. Talk us through the stages you go through between first thought through to exploration, and then what are the next steps from there through to yeah, actually, I think this is right, even though most other people in the ecosystem or on this particular topic would disagree with me. How do you build conviction around something like this?
0:15:43 – (Jessy Wu): Yeah, for sure. And like one, it is very much a team effort. So if I keep using the D to C example, there was an afterwork $1 million proof of concept fund that just made 30 investments. And in some things that weren’t traditionally venture backable partially to learn, but also partially because we thought that there were really great founders at the helm of these companies, even though they weren’t traditional kind of SaaS or marketplaces.
0:16:09 – (Jessy Wu): And then we saw that there were a few companies where we’d invested in that fund that were D to C, but just started absolutely flying. They were the companies that had the most consistent month on month growth and they were also starting to be able to improve their gross margins over time. So Leica is an example of that. When we first invested, they had less than great company, less than 4000 dogs subscribed, and they’ve kind of quintupled that and have served over 220 million meals. Wow, two dogs. And there were some others as well. And we were like, okay, what do these D to C companies have in common?
0:16:53 – (Jessy Wu): And there were a few things. So one was like end to end control of the product and a manufacturing capability. So, for example, Leica manufactures all of its own products. It’s not third party manufacturing. And they can have very tight control over quality, over the R and D process, and over costs. So as they scale up, they can buy more and more of the same supplies against key ingredients, for example, and negotiate the cost of those supplies down.
0:17:29 – (Jessy Wu): And they can make their equipment better and better at producing those things. So that’s very hard for a kind of fast follower to come in because there’s a physical mode. There’s these big warehouses, big equipment that they’ve gotten and customized all of these supply chain relationships, logistics relationships. So we were like, that’s as significant as software companies have. And then there was also a distinctive product. So a real kind of ten x between kibble that you might find in the supermarket and the kind of premium, lightly cooked product that they sell.
0:18:07 – (Jessy Wu): And you’ve also got initially a performance marketing flywheel that does work, right? So, yeah, we saw that there’s more to this than the mental models that other VCs might have put against these companies. So then we started to draw out where specifically it was really important to be excellent and then turn that into kind of our roadmap for investing in other DTC companies. And the framework we put against the.
0:18:38 – (Maxine Minter): Pitches that we see, it reminds me so much of the kind of rule of thumb as an investor that to be a really great investor, you have to see the deal. You then have to win the deal, and then you have to learn from the deal or work the deal. And if you can get that flywheel happening over time, you really start to get better information and build a more impactful portfolio than you otherwise might be able to do. Yeah, I mean, I think one of the things that jumps up to me there is the process that you went through and the kind of learning from the decisions that you’ve made and using those as learning points to then rebuild your decision making framework.
0:19:13 – (Maxine Minter): How frequently are you doing that cycle for yourself and as a fund, like, how frequently are you adjusting your decision making models?
0:19:21 – (Jessy Wu): Yeah, I think it is one of the benefits of having a really large portfolio as a first time fund manager. So we have 25 positions in this kind of $20 million afterwork fund, so we get to track a lot of different companies. And absolutely. I think that with every company, there’s a really salient set of learnings to be had about executing on the zero to one, about what product market fit looks like for different kinds of companies, about what are some acquisition methods that seem to really work and ones where it’s like squeezing blood from a stone.
0:19:57 – (Jessy Wu): Yeah, I think it’s a really privileged position and one that we don’t take for granted to have all of these different things to learn from. Curious what you think, Maxine, because you’ve got a significant portfolio as well between your fund and angel investments. How do you think about kind of codifying the experiences you’ve been on and learning from them?
0:20:16 – (Maxine Minter): Yeah, I think decision making diaries people are probably sick to death of me talking about decision diaries, but I just think that they are like the most powerful tool. As you’re learning to be an investor and as you continue to compound on your investing, capturing how you’re making decisions and reflecting on what are the heuristics you’re using. I mean, in your circumstance, Jesse, reflecting on your heuristics specifically for a thesis or kind of the circumstances in which you’re making an investment, the information you’re collecting, kind of how you’re deciding and adjusting those over time, I think are really impactful.
0:20:49 – (Maxine Minter): I do also think just it adds a new lens to this learning check question, especially for folks that are coming in and wanting to start angel investing in whatever stage. I’m constantly beating the drum to spend a year, write as small a check as possible and reflect heavily on how you’re making decisions and what you’re learning over time. Because I do think the information value of time is so valuable in our industry and actually, I feel like we’re seeing a whole bunch of folks do this at the moment.
0:21:24 – (Maxine Minter): I’m seeing this kind of across the ecosystem where funds are leaning on that information value of time and not deploying early. Right. In my world, in the pre C world, there’s lots of folks and, Jesse, you and I share quite a few cap tables and kind of have seen this firsthand. Actually, all three of us share a couple of cap tables. Party cap table, party captain, party. We have seen these a couple of times where definitely the big international funds and even some domestic funds moving out of that precede, like, early seed stage because they want the value of more information.
0:21:57 – (Maxine Minter): And so they get to kind of make a mental decision like, we want to back them or we don’t want to back them, or we don’t have to make a decision now. We can actually wait and collect more information over time and make that bet into the future. We obviously don’t have that opportunity as a fund because we just do precede, and we only write that first up check. So we kind of have to live and die by our decisions, which makes it a little bit more high conviction.
0:22:21 – (Maxine Minter): So we really have to kind of get to conviction on that. But, yeah, I think decision diaries being the major level that I use, and then reflecting on those decision diaries at an annual cadence. One thing that I am currently percolating and would love, both Cheryl and Jesse like your thoughts on this because you both have big portfolios of companies that you’ve backed and then even bigger portfolios of companies that you’ve passed on.
0:22:44 – (Maxine Minter): How do you review your anti portfolio and how do you think about your anti portfolio? Yeah, and to be what I mean, here an anti portfolio just for those folks listening is the companies that you considered and decided not to invest in. Go ahead, Cheryl.
0:22:59 – (Cheryl Mack): Yeah, I mean, like, I guess if I think about what my anti portfolio is, it is quite a lot because I probably see more than the average angel investor, but it’s not something that, like, actively go out and go through my anti portfolio on a regular basis and compare it to how they’re doing. Now, what typically happens is I will hear about a company doing really well who have just raised their 100 million Series B and X valuation, or sometimes that’s not listed, but you can kind of infer from what they’ve raised.
0:23:33 – (Cheryl Mack): And then I’m like, hey, wait, I saw them, and go back through my list, and I will look at my notes, and those are the ones that hurt the most because, yeah, they’re so painful. It’s so painful. I talked to funds about this and maybe, Jesse, I’m keen to hear your thoughts, because when I talk to funds about this, funds are like, we would rather see the investment and have said no than have not seen it. At kind of I feel a little bit differently because I’m like as an angel, I just know that there’s no way that I’m going to see everything.
0:24:07 – (Cheryl Mack): My goal in life isn’t to see everything like a funds is. I don’t know if that’s after work’s goal or not, but I hear a lot of funds say we want to see everything, whereas I just know that I simply can’t. So when I see something and I say no to it and then it becomes really like a very successful company, that hurts me more than if it’s like, well, I didn’t get to see that and I never had an opportunity to invest in I clearly obviously would have invested in it if had I had the opportunity.
0:24:33 – (Maxine Minter): So it’s like I can almost give myself this out.
0:24:37 – (Cheryl Mack): I don’t know if that’s the best approach to it, but I can’t say that I actively go through my anti portfolio. But I do look at my notes. If I see something and be like, why did I say no to that and see if there’s something there. And sometimes it’s like, yeah, you know what, I still stand by that. And they could have just raised their 100 million, doesn’t mean they’re going to have a good exit or that just wasn’t for me. And you know what? As angel I wouldn’t have been helpful anyway. So maybe being on their cap table just I would have been taking up dead space and that’s not helpful for anyone.
0:25:05 – (Maxine Minter): So it’s I mean, do you guys hold yourself to the standard of wanting to see every single company in A and Z?
0:25:14 – (Jessy Wu): Yes, I would say that substantial coverage is a goal and I think it’s not necessarily always to review each opportunity in depth, but to have it referred to us or to have seen a pitch deck through our pitch portal. I think that Australia in particular and with things slowing down a little bit now, it’s not too hard to have something close to full coverage, like maybe 80% coverage. So I think that, yeah, we’ve tried to build the infrastructure through the community and through our brand that that is something we can try to work towards.
0:25:56 – (Jessy Wu): I think with anti portfolios reflecting on some of the ones where we had a few meetings with them and either took them to IC and didn’t get over the line at IC or the dealee didn’t ultimately have conviction to trigger an IC. The N is small, but I do think that some examples are where we over rotated on the business model already existing or there being lots of kind of bodies in the idea maze as they say. So different people have had different goes at the problem and that’s a bit of a top down way of thinking about it, which is like, oh, this has been a very salient problem for quite some time, but nobody really has cracked it or this product and business model exists elsewhere in the world in some form already.
0:26:50 – (Jessy Wu): I think that that is where Execution or the founder, having just like a really bright spark about how they’re going to kind of capture lightning, can be difficult to evaluate in an investment process because it’s not really real until it happens. And so I think that’s something that really good investors probably get better and better at, which is just assessing where regardless of whether there’s lots of bodies in the idea maze, that there might be some reason that somebody who comes at it with a slightly different point of view or with a real spike in, I don’t know, performance marketing or like in TikTok marketing or something like that could just take off.
0:27:38 – (Jessy Wu): Maybe an example is like Checkmate Blackbird invested in that seed and it’s recently raised a big Series B from international investors. They’re doing something that at first pass resembles Honey, which is like it basically will populate a code for you when you check out and you’ll get a discount. And it’s like, oh, hasn’t that kind of already been done? Honey exists, it got acquired by PayPal. It’s not a huge standalone business, haven’t they got distribution?
0:28:07 – (Jessy Wu): But I think what we may be underestimated about Checkmate is just how much cutthrough they were able to achieve through resonating with people on new platforms like TikTok and getting that virality behind them and becoming the most downloaded app in the App Store in the US.
0:28:25 – (Maxine Minter): Yeah, I think it’s a really interesting question for us in decision making as investors. I love this concept of an idea maze and that there’s a lot of bodies in that idea maze already. There’s so many very high profile and then less high profile examples of where you look at an idea and it’s not clear that it will break out relative to the other people in that group. Google obviously being the most obvious one of these.
0:28:52 – (Maxine Minter): There were so many search engines at the time that Larry and Sergey went to market for their seed round. And it’s really easy in hindsight to be like, well, Google’s the obvious bet, but was it obvious at the time really? And especially from a kind of decision making perspective, like the information that you considered to try to get to conviction, was it knowable at the time that you made the call? This is the challenge of investing super early and looking back on your kind of anti portfolio is constantly asking yourself the question like, okay, the reason that this won was that knowable at the time or was that information that had to be collected somewhere further down the journey?
0:29:30 – (Maxine Minter): Also on the emotional pain of looking at your anti portfolio, if you ever just need like a metaphysical pillow to cry on, bessemer has a post about their anti portfolio and it includes like Airbnb, Instacart, et cetera. So if you. Ever have a moment where you’re like, oh, my goodness, I missed this amazing business. Just look at Bessema’s anti portfolio and then their overall returns and just place it under your head and shed a tear into it and then move on.
0:29:57 – (Jessy Wu): Yes.
0:29:57 – (Cheryl Mack): Perfect. We should send that out to all of our listeners. Just they can have that as well, right?
0:30:03 – (Maxine Minter): Yeah. Actually, maybe we should do that. That could be our first piece of merch. Jesse, you were just nailing our first piece of merch.
0:30:11 – (Cheryl Mack): It’s a pillowcase. We should send people a pillowcase.
0:30:15 – (Maxine Minter): Amazing. Yes. Done. Would you invest in that as a D to C company?
0:30:20 – (Jessy Wu): It might be a bit of a niche market size, but we can grow it.
0:30:24 – (Cheryl Mack): What if we spent 48 hours in bed with it? Like the toilet paper?
0:30:28 – (Maxine Minter): Yeah, I think that is a smaller niche, Cheryl. I’m not sure how that becomes a larger market. You cry into it. The theory being that your tears expand the market. Is that the direction? I don’t know. Who gives a crap? Guy spent 48 hours on the toilet.
0:30:42 – (Cheryl Mack): I could spend 48 hours in bed.
0:30:44 – (Maxine Minter): Like, truth. Yeah. It’s much less lewd, that’s for sure. So on that thread, as you’re thinking about ways of making decisions, especially in those moments where you’re like looking at companies and trying to take in all of the disparate pieces of information, how do you think about kind of first impression system, one decision making versus considered cinematic analytical decisions based on the information you can get at precede and seed? I mean, they are really low information stages to be making calls.
0:31:17 – (Maxine Minter): How do you go about making those decisions and collecting the information you need and moving between those two systems? Because in my opinion, I think that they both have value at that stage.
0:31:25 – (Jessy Wu): I totally agree that they both have value. So I think using the language of Kahneman systems One is kind of the very intuition driven. Yeah. The first set of thoughts that you might have. And then systems two is almost the override, where it’s more logical, it’s less emotional. And I do think that first impressions do count for a lot because we have a limited amount of time with founders a 30 minutes, 45 minutes call to make a judgment on whether you want to dig in and learn more or whether you think it’s unlikely it’ll be on the investment path. And then you don’t want to take up too much of the founders time.
0:32:06 – (Jessy Wu): But I do think that there’s also something a little bit dangerous in over indexing on that systems. One first impressions thinking so. Something that I’ve noticed in myself is that I can be very dazzled or impressed by founders who seem like they’re really quick and you’ll throw something out there and they’ll grasp the concept immediately, or they’ll grock the mental model that you’re laying down immediately, and they’ll be able to speak to it in this very kind of articulate, polished way that betrays this kind of intellectual deafness.
0:32:44 – (Jessy Wu): And you’re like, oh wow, they’re like this powerhouse at processing information. They could do anything. And then I think when you step back a little bit from the moment, you think, well, are there subsets of people who are just really familiar with the kind of reference that I’m throwing out there? Like, are we part of a similar in group where this is just like a common thing that we talk to one another about?
0:33:10 – (Jessy Wu): It feels like you’re throwing something out there and they autocomplete your search. But then it’s like, do we just both have these cached thoughts that we’re saying at each other and you just happen to have the right cookie stored in your mind to finish my sentence? Whereas somebody who’s not part of this in group or part of the group that is mine might come across as slower because they’re oblivious to the kind of ways we talk to each other or the mental models that VCs love to ascribe to considering deals.
0:33:46 – (Jessy Wu): And I think because of the experiences I’ve had as a person, that reference circle for me is people who’ve studied liberal arts degrees or law degrees. It’s people who’ve spent time in consulting, it’s people who’ve spent a lot of time kind of doing the navel gazing about our industry or our craft that other VCs do. And I think that what I’ve tried to do is make sure that when I reflect on a meeting, I think about, oh, was I really blown away by them because of a genuine, really well articulated insight?
0:34:28 – (Jessy Wu): Or did I just get the impression that they had a lot of intellectual acuity because they all knew about all of the ideas and concepts that I have on my mind? And that’s something that I’ve learned to be more attuned to and not over index on.
0:34:44 – (Maxine Minter): I’m so into that analogy. The casing of my same mental models and the cookies so good. So good. Maybe perfect case in point. Sounds like all three of us have those same cookies. So good. A good friend of mine actually shared this term with me, courtney from Sousa. This idea of VC catnip, like there are these things that they come up in conversations and it’s like VC catnip and you have to stop yourself from jumping at it. Jumping at it. I think this is one of the really nerve wracking things about the absence of diversity in folks writing checks is that probably if the folks that are deploying capital are largely from similar cultural backgrounds and have had similar experiences, it means that their cookies could look similar.
0:35:37 – (Maxine Minter): Which mean those founders that are referencing information that isn’t in those cookies but is really valuable, they don’t get cut through. Totally the downside for the ecosystem. I think that that is terrible because it stops us from being a true meritocracy. It stops us from backing those ideas that have a huge opportunity behind them, regardless of how they’re communicated to this particular group of folks that are deploying capital. But on the other side, I also think it is a superpower for folks like us who don’t look like the norm, who haven’t necessarily had the experience of the norm, that our cookies might actually be slightly different, so we can see opportunity in groups of people that are not the norm.
0:36:16 – (Maxine Minter): How do you think about controlling your biases, thinking about backing people who don’t look like you? And how do you try to make sure that you kind of see opportunity in all of the versions that it shows up for you?
0:36:31 – (Jessy Wu): Yeah. So I think for me, my story about inclusion and exclusion is probably more informed by the fact that I migrated from China to New Zealand when I was seven than by being a female and by being a woman of color. So what my story was is that know landed in New Zealand having very little English and also having no understanding of the tacit norms and implicit knowledge that existed within a year three classroom.
0:37:08 – (Maxine Minter): They’re so powerful as unwritten rules.
0:37:10 – (Jessy Wu): Yeah. An anecdote that I’ve been thinking about recently is in year three. It was towards the end of the year, and I got invited to my first birthday party. And I’d been hearing about other kids going to birthday parties all through the year. And I was really excited when I got invited to my first one. I felt very grateful to be included. And I remember that there was this invite that was kind of handwritten by the mum on a card, and it had the details where and when, and she wrote, PS.
0:37:44 – (Jessy Wu): Bring togs. So for those who don’t know, toggs is the kind of word in New Zealand for like, a swimming costume, like swimmers. But we didn’t know what it was, my family and I, and this was like kind of pre Google, I want to say. It was like the early two thousand.
0:37:59 – (Maxine Minter): S, the good old days.
0:38:00 – (Jessy Wu): But basically we were like, okay, let’s look it up in our paper tomb, Oxford Dictionary. Like, okay, togs toggs. Couldn’t find it. We were like, what are togs? And then we were like, Maybe it’s toys. Is it like, bring toys? But then what is the context here? Like, bring a toy as a present. Bring toys to play with. How many toys? What kind of toys? And I remember just being just riddled with anxiety for a week, thinking that I’d like, blow my chance to find belonging at this kid’s birthday party because I’d bring the wrong thing.
0:38:40 – (Maxine Minter): Oh, my heart breaks. I know, I just want to go.
0:38:44 – (Cheryl Mack): And tell seven year old Jesse what a dog.
0:38:48 – (Jessy Wu): And that’s kind of a microcosm. Little things like that came up throughout my childhood. And I think now as an adult, the way that I reflect on inclusion is, I don’t want to deny that how you look and your culture is salient, because it is. But I do think that there is this kind of almost invisible dimension which is do you possess the tacit knowledge? Do you possess the kind of shibblers, the reference?
0:39:20 – (Jessy Wu): Do you have access to kind of the in jokes, do you know how to dress for an occasion? That kind of thing that actually is more alienating to people than simply rocking up and feeling like they’re in a visible minority. So I think because that is my story, that is the way that I approach the question of diversity and inclusion, which is not necessarily to over index on kind of differences in people’s demographics, but really focus on creating the kind of environments where people don’t feel alienated, where people feel there is an on ramp to learning the tacit knowledge by making them more legible, by codifying them like what it means to be part of this community.
0:40:10 – (Jessy Wu): Our values, how we do things, making that really legible to people being the kind of hostess that does the hard work of including people who are kind of sitting by themselves at the side of the room. So I think that’s how I live those values in my life. And yeah, I think that instead of tracking demographics really closely, it’s like, are you turning up in a way? And are you putting on events that are able to feel accessible to people who don’t identify with this in group?
0:40:44 – (Maxine Minter): I think that’s so powerful.
0:40:45 – (Cheryl Mack): I think that raises some really interesting points around how we can do better as investors to bring new people on board. If our whole goal for this podcast, for example, is to open source some of those conversations that we get to have behind closed doors, well, how do we empower the next generation of angel investors who may not necessarily look like us or sound like us or behave like mean like Jesse? I’d really love to just ask you if we want to make people feel less alienated coming into angel investing, what suggestions would you have?
0:41:21 – (Jessy Wu): I mean, I think that you have done a huge amount here, Cheryl, like with your events, with creating on ramps for people to start being angel investors through your syndicates and with kind of really reducing the barrier of being a sophisticated investor to start participating and deploying money there. So I think that’s all fantastic. So I think I’m really keen to hear about how you guys think about it as well, because you have both done so much to create on ramps and to include people who probably don’t recognize themselves as angel investors or part of this ecosystem.
0:41:58 – (Maxine Minter): I think the reminder that we are indexing visual indications of diversity is just a heuristic. We’re making a whole bunch of assumptions that me presenting as a white woman, I had a certain set of experiences and I have a certain set of mental models and expectations such as like a middle class white woman, like what I bring to interactions kind of and my expectations of how I would be thinking, et cetera. I think that the reminder that we are just making assumptions about how someone else shows up.
0:42:35 – (Maxine Minter): I think that is such a wonderful reminder. And my big one I think I’m aligned with you is that information is one of the biggest barriers there I can think of. So as you were telling that story of being third grade Jesse, trying to work out what a tog is, that is an acute version of a very relatable experience I’ve had in so many different circumstances. As you step into new environments and you’re like what in the actual f is this jargon word that this person is using that I don’t understand and therefore cannot apply any other information I have or intellect I have to it. And I think it’s something that you have to be so careful of is indexing too much on knowledge as opposed to intellect, right? Like knowing the right words, knowing the right frameworks, knowing the right people, et cetera.
0:43:28 – (Maxine Minter): So I think I probably would think about it in two directions is like one, how can you change the informational asymmetry between the in group and the not in group and help them be able to engage in that? And learn about it faster so that they can speak the language if they need to, or at least understand the dynamics that are happening. And then the kind of inverse of that of reminding the people in the in group that they are actually in the in group.
0:43:55 – (Maxine Minter): I think the reality is that for a lot of people that are in the in group they just don’t think about it. You don’t think about it like you forget that you are then there and I see this all the time kind of with my executive coaching hat on where CEOs are just like out doing their thing. They’re just like building their companies, having their conversations and they don’t realize that they now have the label of CEO on them. So they are not getting the information that they need or in the same unfiltered way that they did when they were just a person building a product.
0:44:24 – (Maxine Minter): Now they are a CEO of a very successful company and they come with a whole bunch of information filters that they didn’t kind of totally grok previous to that or I think as investors you have to be aware of that dynamic as well. Like the moment you have that title of investor or you start working for one of those funds, information gets filtered to you in a certain way or you have a certain impact on people that might not be communicated to you and might not be entirely obvious to you in kind of first interactions. And so I think it’s also like awareness and a kind of backwards communication of like, oh, I now am being experienced in this way for a whole bunch of reasons that I don’t have control over.
0:45:03 – (Maxine Minter): And so what does that mean in terms of the way that I communicate, the actions that I take? And I think that has a bunch of different impacts. It’s a high leveraged thing and a potentially destructive thing as well. So I think about that in that dichotomous way of both inward looking and outward looking and how you kind of close that gap, because I think it’s a reality of what humans do. Right. We do it in all circumstances.
0:45:27 – (Maxine Minter): We construct those norms in a small group and it’s just about being aware of the impact of those and how to access them.
0:45:33 – (Jessy Wu): And also being aware of the fact that being a capital allocator gives you a degree of power and also casts a shadow. Right. Because I think we all are just still the seven year old who didn’t know what togs are, but like, absolutely.
0:45:53 – (Maxine Minter): Yeah, every day, every day.
0:45:55 – (Cheryl Mack): I’m like, what does that mean?
0:45:56 – (Maxine Minter): Yeah.
0:45:59 – (Jessy Wu): Other people perceive us as investors whose judgment, advice, opinion of them matters. And I think it’s something that requires a lot of awareness and growing to be like, oh, not only am I an agent, I’m also a principal. And that comes with a degree of responsibility to be very meticulous with your words and how you treat people because you’re amplified by the role that you have and the capital that you are the gatekeeper to.
0:46:31 – (Cheryl Mack): Yeah, I think it’s interesting when you see founders holding you in that regard because I don’t feel like I have this power that it feels like I wield sometimes. And I think we need to be conscious of that as well. One of the most interesting situations I ran into is that I became a VP of a fund and a founder that I had spoken with regularly, just as a casual peer, peer mentor kind of thing. Doesn’t talk to me as much anymore because that fund has invested in that company and I lost that for the longest time. I could not work out why. It probably took me three months longer than it should have, but I realized, oh, because that information is now being filtered from me and I don’t have access to that anymore because I’m taking on this capital role. So I think as investors, we need to be conscious that we have that perception placed on us, whether we want it or not, and how to either foster that back or take responsibility for it and make sure that we’re putting ourselves in the right position to empower the founders in our lives, to ideally filter the right things out or not filter as much out or only filter.
0:47:47 – (Maxine Minter): What we don’t want out. I’m not sure. I think it’s unavoidable. I think that is the right rational move for founders to filter information and because that information does have an impact to them, like a very material impact. And the reminder that the founders are the ones that are doing all the work here, they are the ones taking an all in bet on one company and committing ten to 15 years of their life to this journey. So I fully understand that is the right filtering mechanism. I think it’s just like understanding that as an investor, like, you are collecting information that is now going through some kind of filter and that is a reality and that is the way it’s going to be. And Jesse, I love this. Like, taking responsibility for the impact that you have because of the leverage point that you now sit at as you progress mean even from angel investor all the way know. I think anyone who’s sitting in an investment role or even in support role at a fund, they can also experience that leverage impact.
0:48:49 – (Jessy Wu): Yeah.
0:48:50 – (Maxine Minter): There’s one thing I have observed of you, Jessie, that you are so thoughtful and excellent at thinking about the impact of your actions. And I would love to explore, like, do you think about the theory of change as you are applying it? Do you strategize and think about it? Does it come naturally? Is it kind of a system one or system two thinking for you in the way that you think about theory of change?
0:49:17 – (Jessy Wu): Yeah, so I think for me, the theory of change that I see both as being the most salient in our society is something that some people call like the Overton Window or like, what’s acceptable discourse. So for those who are unfamiliar, it’s kind of like saying that ideas sit on a spectrum and you can map it to a political spectrum or you can map it to a broader kind of three dimensional map of going from unthinkable to radical to acceptable to popular to policy.
0:49:57 – (Jessy Wu): And then you might go off the other end of the spectrum and kind of do it in reverse order. And the theory kind of says what politicians propose, what they campaign on, what ends up being legislated, has far less to do with their personal preferences and who they are as a leader and far more to do with where that Overton Window sits. So politicians on both sides of the spectrum will probably only ever legislate on things that sit in that kind of at least acceptable, hopefully popular, sometimes bipartisan middle ground.
0:50:36 – (Jessy Wu): And that’s where the change occurs. That’s what gets legislated, that’s what gets investment et and like, what is the role of discourse in moving that? So I think you can see in the states that when Donald Trump made it socially acceptable or know from his position as the candidate and then the president saying the things that he did about keeping immigrants out building the wall. He drastically moved the Overton window over to the side where those kinds of things that are whistleblowing for racism. In some ways it’s like it’s the southern border. It’s not a border with that just I think he dragged the Overden window over there. So even though some of the more hardcore policies might not have gotten implemented or gotten enough bipartisan support, certainly what was possible to be legislated moved over to his point of view of the world. And I don’t even want to map it to a left or right wing thing because I don’t think that there’s necessarily any coherence between an economically conservative ideology and an anti immigrant one.
0:51:54 – (Jessy Wu): So I think in our corner of the world, in the VC ecosystem, there’s also things that are currently kind of seen as radical or unthinkable insofar as they’re just not even part of the consideration space.
0:52:08 – (Maxine Minter): Right.
0:52:09 – (Jessy Wu): And I think to create systematic change that can kind of be scaled beyond just one person. I see it as being higher leverage to play some role in shifting nudging, curling that overton window over a space where you’re really excited for some stuff to happen, rather than necessarily being the single hard charging person in the middle of that, especially if that what you’re really interested in. Changing currently sits in a radical territory. You need to create critical mass and gravitational pull towards it by shifting that broader window of discourse. So, yeah, that’s kind of my theory of change. Curious for what you guys’theories are.
0:52:54 – (Maxine Minter): I mean, I would totally agree with you. The opening window has been extremely informative in the way that I think about change of all forms and also understanding yes, interesting how you bring something into the field of view as acceptable, but then also how it leaves the field of view of acceptable. Like watching for those indications that we’re kind of on the back half of something no longer being acceptable. And I think there’s looking at both of the edges of the ocean window and looking for those behaviors.
0:53:21 – (Jessy Wu): Yeah.
0:53:22 – (Maxine Minter): It also frames the way that I think about the roles that you can play between radical and how that might be experienced through to progressive, through to consensus. You hear people put out a radical idea, and I think this is what is so interesting in contrarian thinking, right, is that a lot of contrarian thinking is the radical element. They say it and you’re like, that’s crazy. Could work. And you quickly go through that process. And I think that’s a big part of it.
0:53:55 – (Maxine Minter): As angel investor, I wonder if we want to experiment with the cojones question as a wrap up here. Real time iterations. You’re hearing it real time.
0:54:04 – (Cheryl Mack): What is the biggest cojones thing that you’ve done?
0:54:07 – (Maxine Minter): Yeah. What is the moment where you have shown the most cojones?
0:54:10 – (Jessy Wu): Yeah, I need to think about this one. Does anyone of you she want to answer it first?
0:54:15 – (Maxine Minter): Oh, I love this reverse questioning. I’m not sure this is how a podcast is supposed to work. I’m digging it as a style. I’m into it. What is the biggest Cajones moment?
0:54:26 – (Cheryl Mack): I mean, starting a company in general, I think is a huge cajones moment. Like putting your own capital and time and putting a thesis out there that something is. I think this thing is going to work and I’m going to chase it down with all of my heart, all of my energy, all of my time, money and effort for the next five to ten years. In general, I think that’s probably one of the biggest cohnas things you can do in life.
0:54:50 – (Cheryl Mack): It’s partly why I think we all back 100% founders who chase that, but having really I’ve started companies before, but Aussie Angel is my most recent. That feels like the real jump into the Ocean 2ft Forward or headfirst actually moment where it’s like, I really needed to have those Cajones and go for it. So I think I’m going to say starting a company.
0:55:16 – (Maxine Minter): Yeah, 100%.
0:55:18 – (Jessy Wu): I think for me, the thing that actually requires bigger cojones than any individual, maybe slightly impulsive action is turning up for the aftermath. As you guys have kind of pointed out, it is a small ecosystem that we exist in. And to the extent that things get a bit pointed with any particular person, like that person’s going to be at a three six one angels event.
0:55:48 – (Cheryl Mack): Have you been burned by the lightning, Jesse?
0:55:51 – (Jessy Wu): Not hugely, I don’t think, but I think it’s like you have to play this kind of long term game, hopefully with long term people, and I think that means you have to kind of own your truth. You kind of can’t just drop a grenade and then smoke bomb and be like, I’m never going to see you all again. Because in some ways that’s kind of not courage, right? You’re running away. But I think that it takes courage to live your truth in a way that maybe rub some people the wrong way or is maybe slightly pointed and makes somebody feel that they are being challenged.
0:56:30 – (Jessy Wu): But then to be able to just keep turning up in the same ecosystem as them, on the same cap tables as them and still kind of have functioning relationships with people and not feel the desire to kind of like flip table rage quit. Yeah. Takes Cajones to kind of find equanimity.
0:56:51 – (Maxine Minter): Amazing. Well, I cannot wait to continue to stay in the same ecosystem as you. Even if you flip a table here and there, I’m here for it. I’m up for the table flipping. And I’m very grateful for your time this Saturday morning and having a chat with us.
0:57:07 – (Jessy Wu): Yeah.
0:57:07 – (Maxine Minter): Thank you, guys.
0:57:08 – (Jessy Wu): Great to be an early guest and really looking forward to where this podcast goes. I think you guys are fantastic voices and I look forward to having you in my ears on my walks and runs and oh, that’s very sweet.
0:57:21 – (Cheryl Mack): Thank you, Jessie.
0:57:22 – (Maxine Minter): Thanks, Jessie.