Zaw Thet

Tech Entrepreneur & Investor at Signia VC. Host of Meet The Operators

THIS CHAT HAPPENED ON April 01, 2016

Discussion

Zaw Thet@zawthet · GP, Signia Venture Partners
Howdy folks - I'm Zaw Thet, one of the founding Partners at Signia. We're an early-stage investor in companies like Cruise, Boxed, Super Evil Megacorp, and more. I'm also a recovering serial entrepreneur, devoted Green Bay Packers fan (grew up in WI), horrible golfer, and passionate about social causes like fighting climate change. Basically, we can talk about anything and everything (yes, you can even pitch your new start-up idea). ----------------------- Thanks everyone, that was super fun. Hard to type that fast...and grammar/spelling definitely suffered, but happy to follow up with anyone. You can ping me on twitter here: https://twitter.com/zawthet and be sure to follow my series of Meet The Operator interviews on medium: https://medium.com/meet-the-oper...
Jennifer Colton@jennifer_colton · Compared to most I'm a Luddite.
What has been your biggest failure as an investor or entrepreneur? What did you learn and how did you bounce back?
Zaw Thet@zawthet · GP, Signia Venture Partners
@jennifer_colton way too many to even list here! my biggest lesson in life has been to never see it as failure, but as feedback. you're going to fail multiple times in your life...every start-up goes from the highest heights to the lowest lows...what's important is how you come back. Winston Churchill said it best, I'm going to paraphrase: "success consists of going from failure to failure without lack of enthusiasm"
Avinash Dabir@bringmedabir · Remix Media, Inc
Who is one guest (no longer living) you'd like to have on Meet The Operators? Why?
Zaw Thet@zawthet · GP, Signia Venture Partners
@bringmedabir my grandad (pho pho in burmese). he and i were super close and he's one of the most interesting people i've ever met. from teaching history in england to being in WWII...the stories that man had never ceased to amaze me. i still miss him everyday
Jon Sadow@jonsadow · Co-Founder, Scoop
You have an adorable son with tons of energy, are a full-time investor, and somehow still squeeze in time for the social causes you believe in. What advice can you give about how you find balance in your life, and how important it is to save time for things like fighting climate change?
Zaw Thet@zawthet · GP, Signia Venture Partners
@jonsadow to be fair, this answer has changed a lot as i've gotten older (going on 18 years now since I started my first company out of Stanford). before i had a beautiful wife and kids the answer was work, work, work, work. What fun I had was usually related to work. Now I'm much more of a believer in work-life balance. Actually one of the interview questions I ask people is what special thing they do that's not related to work. There is a great correlation between driven, curious people that have cool hobbies or pursuits and their success in the workplace. For the past 10 or so years, I've tried to pick a new skill/hobby every year to try something new out and see what stuck. Example of that have included learning to fly small planes, golf (still horrible), Spartan Race (sort of a super cross-fit), writing screenplays, etc. I think important to keep you brain/body fresh for work -- and keeps me much more productive. Sorry for long answer, let's chat about it more offline over a beer!
David Selinger@daveselinger
@zawthet @jonsadow Screenplays, really? Do tell!
Zaw Thet@zawthet · GP, Signia Venture Partners
@daveselinger @jonsadow they are so bad...but the ones i've been working on for a while imagine normal everyday life with a twist or two. for example, what if every human had a tail? LOL, yes i'm serious. how would we interact differently? how would things like doors and windows be designed? what's bedroom etiquette?!?
David Ko@davidko
With a number of successful investments in the Signa portfolio, what common characteristic do you see across those companies, founders and employees?
Zaw Thet@zawthet · GP, Signia Venture Partners
@davidko mission-driven founders. they passionately care about something that's not just in the pursuit of $$$. they can communicate that vision to investors, customers, press, and most importantly employees (both existing and new).
Austin Teague@austin_teague · Full-Stack Marketer and Entrepreneur
@zawthet As an investor how do you find new startups? Specifically is it through referrals, cold emails, specific searches/sites?
Zaw Thet@zawthet · GP, Signia Venture Partners
@austin_teague combination of all of the above. 85% of the deals I've done as an investor have come through trusted referrals. I'm pretty strategic about building and keeping relationships strong with people that have deep but separate networks. The other 10% is from specific searches for an investment thesis that I might be working on. For example, I've been looking at vertical social networks for the past 2 years trying to find a company that can build something for just for media / entertainment interests. So, in those instances I'm actively contacting companies / entrepreneurs to get to know them better. The last 5 percent is through networking / conferences etc. I may meet a great entrepreneur at a dinner or at a conference and build a relationship from there. I can say with absolute certainty that I have never made an investment from a cold email and never will. I used to try and respond to every cold email I got with at least a "thank, but no thanks" / but my inbox has gotten too crazy for that. So, if you don't know me and you want to...find someone in your network that does know me and get them to introduce you please!
Austin Teague@austin_teague · Full-Stack Marketer and Entrepreneur
@zawthet Thank you for the feedback. I completely understand your sentiment. This further adds validation to research I've found that investors of all stature within the industry strongly desire to only talk to startups that come recommended from trusted sources. *Personal plug: my team and I are developing a platform to help investors, like yourself, do your job more efficiently and effectively.* Thanks again.
Zaw Thet@zawthet · GP, Signia Venture Partners
@austin_teague well there you go!
Austin Teague@austin_teague · Full-Stack Marketer and Entrepreneur
@zawthet Thank you. Check out http://Fortuos.io if you're interested in learning more
Brian Gott@brian_gott
What is your view on investing in pro-social/purpose driven for-profit companies. It that becoming a saturated/over-done market?
Zaw Thet@zawthet · GP, Signia Venture Partners
@brian_gott i think you can do both...but it doesn't work as well under a current VC structure where all most LPs care about are returns. there are some great purpose-driven investors out there like my buddies at Uprising...and they set it up from the start to be about more than just returns. i think it's actually really hard to find for-profit companies that have a pro-social bent...but when you do they have amazing cultures. our buddy Ido Leffler is one example that has done amazing with this. started two huge consumer brands that both have amazing social impact directly integrated the product.
David Selinger@daveselinger
@zawthet @brian_gott Couldn't agree more. Do you find that pro-social entrepreneurs know where to go if not here?
Josh Felser@joshmedia · Cofounder
Why are you so excited about @ApplePiecapital, alt funding for the franchise biz, and whats your take on fintech in general? Disclaimer: we are both co-investors
Zaw Thet@zawthet · GP, Signia Venture Partners
@joshmedia @applepiecapital fintech is super interesting...and of course we love ApplePie. my biggest issue with the space is the marketing spend that most of the platforms are having to lay out in order to just find people to take their $$$. if you look at LendingClub, SoFi, any of the big guys in the space..they are spending thousands of $$$'s just to get someone to take a loan. in LC's case upwards of 40% of their total revenue. that's a lot...and i'm not sure how sustainable. the banks are not set up to serve these markets...so there is a distinct need for the product, but i worry that we're building something that's going to crash hard in the future. in the ApplePie case, since all the borrowers are franchise owners (and usually own multiple stores), there is no cost to acquire a borrower customer since they come from the corporate partnerships. also these owners typically come back time and time again as they open new stores...so they've solved that origination problem and is probably the biggest reason we decided to invest in a fintech deal even though we'd never done one before. that and the awesome team!
Josh Felser@joshmedia · Cofounder
@zawthet @applepiecapital totally agree. the marketing piece typically eats up all the capital. Also APC provides significant value add to franchisees, franchisors and lenders, which is hard to do for a triple sided market. :)
Zaw Thet@zawthet · GP, Signia Venture Partners
@joshmedia @applepiecapital amen brother, amen
Jacqueline von Tesmar@jacqvon · Community at Product Hunt ⚡️
What are the first tabs you open on your computer/phone every morning?
Zaw Thet@zawthet · GP, Signia Venture Partners
@jacqvon For "work": Nuzzel, Redef, Term Sheet, StrictlyVC, Medium. For fun/family: Lifecake, FB, Instagram Twitter, 7 Minute workout. Yes, Snapchat is missing from this list. I need to up my game.
Mateen Aini@mateen_aini · Head of Digital, MRA
What deals aren't you seeing that you wish you saw more of based on trends you believe will be taking off?
Zaw Thet@zawthet · GP, Signia Venture Partners
@mateen_aini - i think there is going to be a fundamental shift in transportation / automotive. a lot of entrepreneurs have been scared off by uber/lyft and all the $$$ they have raised. that's fair, but there are still huge opportunities out there. we were the largest seed investor in Cruise (which GM has announced they are going to acquire for over $1B) and also the lead investor in Scoop (ride-sharing/commuting platform that serves over 150k employees in Bay Area after only 6 months of beta launch). our infrastructure in the US is broken, highways were built in the 50's before suburbs really started to grow...and mass transit can't find places to lay down tracks. so the only way we're going to fix this is through smart technology...BTW did you see the Tesla 3 pre-orders?!? we've got to find solutions like that which don't contribute to carbon pollution / climate change.
Arnold Myint@blinkmonster · www.arnoldmyint.ca
What do you think about Myanmar's current technology?
Zaw Thet@zawthet · GP, Signia Venture Partners
@blinkmonster honestly i don't know enough. the last time i was there was in 2004...when 6 of us were trying to share a 14k dial-up modem from Bagan to check our email. and people at intersections to direct traffic instead of stoplights. i need to go back asap...especially now with the new civilian government in place. lots of friends and family have started now that we're not supporting military junta with travel / $ back there. i've heard things are changing rapidly...and i do believe that access to broadband (or skip to wireless) means access to information / freedom
Marc Barros@marcbarros · Co-founder Moment
What is the biggest struggle founders have in transitioning their role from a seed stage (pre-product) to a series A (company building).
Zaw Thet@zawthet · GP, Signia Venture Partners
@marcbarros usually hiring. not finding candidates per-say, but finding the right candidates. when you're seed / pre-product you're selling the dream and typically there is also a nice equity package that comes along for the founding team. when you get the A you have more $$$ to spend...but you've now got to double/triple your team (in some cases) and find people that have the same passion and aren't going to fuck up the culture.
Marc Barros@marcbarros · Co-founder Moment
@zawthet what about their personal leadership trait changes in going from doing a lot of the work as a founder to leading others? Biggest areas of leadership they have to work on?
David Selinger@daveselinger
Mr. Thet, Do you like investing or being an entrepreneur more? Mr. Kylo Ren, What's been the hardest part about moving to the Dark of the Force? (joking tone, real question :) ) Thank you, BB-8
Zaw Thet@zawthet · GP, Signia Venture Partners
@daveselinger i'm lucky in that i get to be both still. @signiavc is a start-up venture fund...that's the way we treat it. always trying to improve and innovate. and i get to work with world-class entrepreneurs in tons of fun new spaces...so i feel very lucky to do what i'm doing
Zaw Thet@zawthet · GP, Signia Venture Partners
@daveselinger and on going the dark-side -- the hardest part for me has been learning how to say "no" .. and still give good feedback and build a relationship. as a fund we only do 6-8 deals a year -- with 3 partners and 2 other investment principals..that's a max of 2-3 deals a year for me. so i'm going to say no a LOT more than I say yes...and i want to make sure that even the people I say no to are getting something valuable out of our conversations and are willing to refer their friends to me or come back down the line!
Chieh Huang@astrochieh
How many more good years does Aaron Rodgers have in him? And will there be another super bowl win during those years?
Mateen Aini@mateen_aini · Head of Digital, MRA
@astrochieh at least 2.
Zaw Thet@zawthet · GP, Signia Venture Partners
@astrochieh GREAT question. as long as the O-line holds up I don't see why @aaronrodgers12 can't have another 7-8 great years (ala Brady and Peyton). there better be another super bowl win. seeing the @packers win in dallas back in 2011 was one of the highlights of my life! my untrained armchair quarterbacking says we need a few things: more tailored offense scheme to his strength and a D that is world-class again. all achievable!
Derek Shanahan@dshan · Three Hex, Cloud Unicorn
Thanks for doing this Zaw. It seems one piece of the puzzle you hope to help early teams with is finding the right people to jump on board. Can you talk about the challenges you see in hiring these days? How do you find solid candidates for your portfolio teams (if you play that role at all)?
Zaw Thet@zawthet · GP, Signia Venture Partners
@dshan hiring is the number one priority after we've made an investment (or usually after any round of financing). usually the needs wax/wane depending on where the company is in stage. sometimes they've got who they need and are more focused on scale or customer growth etc. i will say that hiring has gotten easier over the past 3-4 months. the "correction" or slowdown means a few things that are of a benefit to all. first, less companies are getting seed funding...so less people are making the jump to starting a company. that makes it a lot easier for existing strong companies to both retain/hire. second, there are layoffs already happening and more to come...so some great people are coming out on the street that are looking for a great company. the crazy bonuses / relocation packages are also starting to go away which means over the long-term that housing/rental prices will start to come down (or at least stabilize)...also a plus. i interview almost all the senior candidates for the portfolio companies we work with...and typically am helping lead a search for 1-2 companies at any given time. that means i'm scouring my network to find people that are a great culture and skill-set fit. asking my friends/network for the best in a given speciality. it's hard work, but also very rewarding.
Patricia Clark@patricialclark · Patricia Clark, Managing Director Acxiom
Hi Zaw, For Signia you say "our normal investment size is between $500,000 to $2.5mm" what is most important for founders to prioritze with those initial dollars?
Zaw Thet@zawthet · GP, Signia Venture Partners
@patricialclark removing as much risk from the business as they can. if they're still in formation stage then it's usually finding product / market-fit. if they're a little later then usually it's around finding profitable ways to scale. in all cases, using cash wisely and always making sure you've got shots on goal
Emily Hodgins@ems_hodge · Community and Marketing, Product Hunt
Hi Zaw! Thanks for joining us today. What one piece of advice do you often find yourself giving to the startup founders you work with?
Zaw Thet@zawthet · GP, Signia Venture Partners
@ems_hodge thanks for having me! my biggest piece of advice is to pay attention to their culture. it's not just enough to put 10 maxims on a wall. integrate what's important to you into every facet of your company. that and don't run out of money :)
Mike Coutermarsh@mscccc · Code @ GitHub
Hi Zaw! Would love to know, so far in your career. Whats the one thing you've done that has frightened you the most? & how's your golf game these days?
Zaw Thet@zawthet · GP, Signia Venture Partners
@mscccc def the 2nd company i started. the 1st one i didn't know what i was getting into, so didn't have any idea how hard it was going to be!
Zaw Thet@zawthet · GP, Signia Venture Partners
@mscccc and the golf game is still horrible. haven't had time to get to the range or the course in a while. hopefully getting out in april to o-club!
Jacqueline von Tesmar@jacqvon · Community at Product Hunt ⚡️
What has most surprised you about founding a company?
Zaw Thet@zawthet · GP, Signia Venture Partners
@jacqvon i've only got 1 minute left, so see all of the above :)
cassyrowe@cassyrowe
Hi Zaw. I have recently been more involved in questions about diversity in tech. What are your thoughts on the lack of diversity in tech? Maybe the challenges we need to address to increase diversity or the benefits of increasing the diversity of our tech networks.
Zaw Thet@zawthet · GP, Signia Venture Partners
@cassyrowe First and foremost, there is a diversity problem. Moreover, there is a sexism problem. I am astounded and horrified by the stories about female founders pitching or team members having to deal with harassment at work. We could have a whole separate AMA on how to solve this and I'd be happy to help you out with that! I'm lucky to work with several awesome female founders/CEOs that we've invested in over the past few years -- ala Denise at ApplePie, Joanna at Kurbo, Stephanie at Vida, etc...as well as awesome leaders at our other portfolio companies like you!