Learning No Matter What: My Experience as a Summer Fellow in VC During COVID-19

By: Evaline Tsai, Costanoa Fellow ’20

Anyone joining a brand-new team in the middle of the pandemic is at least a little worried about the high awkwardness potential. But as my time as a Costanoa Summer Fellow winds down, one of my biggest takeaways is that with a good group of people, you will feel like a part of the team no matter what, even when it’s all Zoom, all the time (also: Zoom fatigue is a real thing). 

Here’s what else I took away from ten weeks of intense learning at a truly unique moment in time.

Observe, do, learn.

When you’re starting out, the best way to learn is through observing and doing. No one expects you to instantly know everything. In fact, it’s a bit of a luxury to be able to ask questions — and it’s great to hear the “why” that underpins decisions, from what will get funded to why something else won’t. 

I’ll never forget my first meeting with a prospective company scheduled bright and early on my second day. I had no idea what questions to ask and it was hard to actively listen while also taking notes and talking with them. But over time, I got better because I could see patterns beginning to emerge: common themes, risks, and challenges even across different industries. The questions that others on the investment team were asking started making sense to me; they patiently and persistently encouraged founders to give them the full picture, detail by detail. 

The internal investment team meetings — held twice a week to maintain connection during the pandemic — were also a great window into how venture capitalists make decisions. What resonates and what doesn’t, how the investment team goes back and forth with each other, the collegial way they’d come to consensus after asking each other tough but fair questions — it was a backstage pass to a really interesting world. Eventually, after multiple pitches and these internal sessions, I felt more confident about what I should explore with companies in different sectors – for example, if it’s a machine learning start-up, it’s a good idea to ask about data rights.

Be flexible

You have to be comfortable with context-switching. In any given week, I would be asked to:

• Attend pitches for companies as diverse as urban infrastructure, edge computing, and lab management
• Write an industry deep dive in preparation for pitch meetings 
• Help out with due diligence by digging into a startup’s financials
• Support some incredibly diverse portfolio companies with PR and sales 

That’s the fun part — it’s pretty impossible to be bored when there’s (a) a ton of work, and (b) it’s all interesting.

Get comfortable saying no

The reality is, venture capitalists say no much more than they say yes. They have to; the pot is finite. That said, it’s never easy to turn a start-up down. We know how passionately founders feel about their work, teams, and ideas. In fact, they might actually have a great company but you still may pass because they’re just not a fit with Costanoa’s investment thesis. It’s also possible you’re not persuaded by some aspect of the business like the product itself, the market potential, or the team. Regardless, you have to become comfortable saying no. Just do it constructively.

Your prior skills and experience are more useful than you think

I’ve been in product management for some time and as I got deeper into my fellowship, I could see how drawing on that experience and skill set was useful in this new domain. That’s probably true for a wide swath of professional experiences so always look for those areas of commonality; your skills will inevitably cross over in some way. 

I personally loved that product management and VCs both prioritize data-driven decision making. As a product manager, I’m very used to setting up dashboards in Mixpanel to understand user interactions or writing SQL queries to analyze event count. As a VC, you do it differently — Excel to calculate SaaS metrics like churn, CAC, payback to gauge the health of the business, for example — but the point remains the same. Gut instinct only gets you so far; data takes you all the way.

I also liked that both VCs and product managers see the value of a cross-functional approach. As a product manager, I was used to collaborating with almost every function in a company. In a VC role, it’s very helpful to have this mind map in your head as you evaluate start-ups and post-investment as part of helping portfolio companies think through their go-to-market strategy. Are they thinking through key hires for various points in their growth? How are they determining product market fit? Do they know how to connect with people on their teams to get the best out of them? Cross-functional experience can help you ensure founders are thinking things through.

This pandemic-filled summer’s biggest takeaway? You can learn, build connections, and be productive in literally any situation. I haven’t actually met most of my teammates in person — with the exception of two socially-distanced walks with Greg and John — but I feel that solid connection with each of them. They’re a generous, smart, and good-hearted group of people who sincerely love partnering with early stage startups. 

As for what’s next, I’ve been spending my time in construction tech, which is fascinating. Are you building a product or company in this space? Connect with me on Twitter (@EvalineTsai) or via email [evaline (at) costanoavc (dot) com