I Left My Six Figure Job At Google To Invest In Startups!

Elizabeth your firm's done around 500 Investments that's right preed three funds in you just raised a fund 46 million in today's episode I had the opportunity to talk to Elizabeth Yin she's the co-founder and general partner at hustle fund they invest in early stage companies and they have led pre rounds of companies like webflow nerd wallet and boom and earlier in her career Elizabeth was a Founder herself launching an adtech company called launch pit which got acquired in 2014 by Buy sell ads I learned a lot in this episode and Elizabeth actually walked me through a journey of launching her own company and scaling that and what problem she was solving so I hope you find some value in this video I'll see you in the next [Music] episode I'm really excited and happy to have you on the show Elizabeth how are you doing today thank you so much manav it's so great to be here the coolest thing I saw in your LinkedIn was like there was a threeyear gap where you just tried a bunch of things and you said I tried many things I learned a lot of lessons I had the same thing happen to me so can you go back a little bit to your early days and can you tell me the founding story of launch pit sure so I left my cushy job at Google in late 2008 and I always knew having grown up around here that I wanted to start a company and so unfortunately however around that time when I left I had absolutely no idea how to start a company and so I had a series of meanderings and learnings over the next couple of years in particular I think things are a lot more accessible these days as far as knowledge base like back then there was no one blogging really there were no videos on how you should think about starting a company these days every startup founder I meet they know about product Market fit they know about minimum viable products they know about how to Der risk you can be anywhere in the world and learn about these Concepts but back then these Concepts didn't even exist so the segue into launch bit was that during these first couple of years after leaving Google I was just trying a lot of things trying to learn basically how to do customer acquisition and was mostly an affiliate marketer at that time but one of the things that I realized is that actually it's quite hard to be an affiliate marketer and AD channels are pretty saturated but a channel that actually is not very saturated and I still believe this today is email marketing I still think that if you have a very compelling email marketing strategy and messaging it can be extremely effective and so that was the Genesis for launch bit where I had so many friends who were marketers by that point including myself like people doing affiliate marketing selling all kinds of products Etc and many of them were finding the most success with email marketing but the issue with email marketing is that you know you're either limited to the subscribers you have or if you try to do cross promotions with other people there's a lot of manual work for example if I want to form a partnership with your newsletter or somebody else's newsletter or your blog list Etc there's just a a lot of manual work in doing the Outreach and setting up the campaigns Etc and it's kind of slow moving so what launch bit was is it was a platform to help with this issue to help newsletters cross-promote with each other and also for products to be able to get into newsletters more easily at scale so essentially an ad Network for email if you will okay so what was like the takeaway from launch like were you happy with the outcome of how the company got Acquired and everything and like when did you know that oh you want to be an investor now so we were acquired in 14 by a company called Buy sell ads Buy sell ads owns a number of different ad properties and AD networks they ended up doing even better than we did our exit was a relatively modest exit I would say and in part we decided to take that exit because we felt it was actually really really challenging it was becoming quite hard to help our newsletters grow their lists and so we were starting to feel stagnation on growth and we felt it was a good time to take the exit so then going back to your question about well when did I know I wanted to become an investor that didn't happen until a lot later so first right after the acquisition and we transitioned everything to buy sell ad I started mentoring other startups started Angel Investing in some friend startups initially it was to help other entrepreneurs avoid some of the mistakes that I had made especially the ones I had made in the first couple of years which were very obvious mistakes and I made so many mistakes and then eventually the mentoring kind of went on steroids and I ended up going to the f 500 startups accelerator program which was the program I had gone through with my own company launch bit and so I knew those books from those days and I got more and more sucked in and ended up running their accelerator program for almost 3 years there so initially I wanted to do all of this mentoring and Angel Investing because I wanted to learn what kinds of businesses people were building at that point in time I remember this is like early 2015 at this point and there were all kinds of new things coming about like I didn't know what cryptocurrency was I didn't know what drones were I didn't know what arvr was right and so these were all things that I didn't really know much about cuz I had been so heads down in building my ads company and I wanted to learn by mentoring other startups and understanding what opportunities were out there I was actually trying to explore new ideas for a future company to take another swing at this but then I realized actually the problem that I was most passionate about in solving and this time I wanted to be something that I could build for 20 30 years or even longer the problem that I was passionate about was actually helping Founders and namely through Capital knowledge and networks those are the needs that early stage Founders first-time Founders in particular have so hustle fun ended up being coming that company that I would start I I didn't end up starting a cryptocurrency company or a drone company or VR company but I was actually exploring ideas to start a new company I was not exploring ways to become a BC I worked at a small accelerator much smaller I reviewed 200 pitch TS while I was there and I read somewhere that you reviewed 20,000 pitch TS in your career like I think personally it's a lot of fun when you get to read and learn about so many different concepts and different businesses the biggest question that I want to ask is like I know investors have like the attention span of like tick talkers nowadays like they literally cuz no one's reading the entire pitch Tech like how can I get an Investor's attention ASAP I'll just be very upfront and transparent like when I look at a pitch deck I spend probably no more than 30 seconds on it yeah and the reason being some people are like well how can you make a decision in 30 seconds the answer is you can't you're making a decision on whether to take the meeting and spend the next you know half hour to an hour with somebody you're not making a decision on whether to invest and so specifically what are you looking for in those 30 seconds I'm really just looking for two things everything else doesn't matter I'll learn about it in the conversation but the two things I'm looking for are one like what is the team's background and I'll talk about that in a moment and two what is specific problem they're trying to solve the problem to me is actually more important than the team because and especially these days every idea is pretty crowded often for a particular idea that I see I'll see 20 50 companies doing the same thing at preed so in those spaces we actually just tend to pass because competitive Spaces by definition means that your customer acquisition costs go up right you're fighting for the same mind share of those customers and it will be more expensive to acquire those customers regardless of what channel you're using certainly ads Mak sense the bids go up but even email marketing you're sending an email and the 20 other companies doing this are sending emails and you know they think about it and the Sal Cycles longer and more expensive so we just tend to avoid competitive spaces and so what I'm looking for in the idea and the problem space is like is this very differentiated and if it's not we'll just pass if it is then I'm interested then I look at the team to see okay does the team have background in this how did they get to this idea and so that's why the team slide is really important because it's really important to know is this the right fit group of people for this particular idea and I think the thing that people don't talk enough about is what I call founder market fit which gets thrown around a little bit but I think it's super important because I think you can have great Founders Who start one company and can be really excellent at it but they wouldn't be able to start this other company that they know nothing about right so you want to make sure you have the best team for this particular idea so that's the thing I look at second in the deck and that just takes a few seconds to look for awesome yeah I was it's funny I was watching your talk like 7 years ago at hustle con and you say something like excuse me like you said passion and it was great like the entire crowd was laughing and I actually relate with that because a lot of time in life you don't really know like you're just going down this path how do you think about that like do you should always just look for problems to solve when you're starting a business or how do you justify like deciding oh I'm going to devote my next 3 years to Ai and like really go deep in that space so how do you think about that I don't think there is any right path but I think being self-aware of what it is you want is really helpful and important so there are some Founders who are solving a particular problem because it hit them personally either they faced it before at their prior employer or in health especially something happened to a loved one and they went down this Rabbit Hole of whatever it is there's that group of people like people who decide to start a company because of a very specific problem but otherwise wouldn't necessarily be starting a company they just care passionately about that problem and want to solve it that's one group of people and that's a group that we do back a lot because we know that their commitment to that problem is very high there are other groups of people where it's like I really want to work with this co-founder I really want to work with this group of people they care less about the problem and care more about the team and the culture of the entity they're trying to set up and that's where you get more of the idea hopping I see that's not necessarily a bad thing I think Founders need to know when to Pivot but you obviously don't want to jump around too much before you get any learnings either like your most ideal scenario is you do an experiment you learn you iterate on that experiment you learn maybe eventually you do a jump but ideally you're not making crazy leaps all around into things that you didn't have any learnings on great and for people who are interested in pitching to hustle fund how can they get a hold of hustle fund is it a simple application process on the website how do you guys prefer companies to approach you guys yeah so we take all p is on our website hustle fund. VC and we look at everything and get back to everybody you know I think there's always this question of like where is my application going you know is it going to be sucked into a black hole like and the answer is we do look at everything and even if you know someone on the team we still ask everyone to submit because it helps us go through all of the materials very comprehensively I think sometimes when you just see a blur it's like well there's more context we needed all this other stuff that you might have in a deck so that allows us to kind of look at everyone's applications in the same way because we ask you for your deck your name what valuation you're looking for where you're based where you're Incorporated Etc because those are the pieces of information we would need and then we go from there amazing how can people find you and how can people read the stuff you've written online I'm quite active on Twitter my handle is @ dunk hippo 33 and my blog is Elizabeth Yin I have not been blogging as much over the last few years but on Twitter I write a number of tweet threads which is basically mini blogs that kind of get to the point quicker thank you so much Elizabeth I know you must be really busy I really appreciate you coming on the show guys if you have a company please go to hustle fund. VC and do your application process today they get back to you really fast and they respond to every application thank you so much Elizabeth for coming on the show I hope to do a recap with you in a year or two and then see see where our Journeys have brought us thank you so much manad I appreciate it also I wanted to say if you're new to this Channel please hit that subscribe button because we want to show this video to more and more Founders and entrepreneur aspiring Founders because that will help my mission of educating more and more people and helping them with their Journey thank you so much for watching