Anne Dwane, a Partner at Village Global, shares her commitment to supporting amazing entrepreneurs working on big ideas. Leveraging her background as an entrepreneur-turned-investor, Anne underscores the significance of establishing networks early and explores the feasibility of launching a company during economic downturns. Moreover, she sheds light on the dynamic role of venture capitalists, particularly within a VC industry confronted by distinctive challenges.
Anne Dwane, a Partner at Village Global, shares her commitment to supporting amazing entrepreneurs working on big ideas. Leveraging her background as an entrepreneur-turned-investor, Anne underscores the significance of establishing networks early and explores the feasibility of launching a company during economic downturns. Moreover, she sheds light on the dynamic role of venture capitalists, particularly within a VC industry confronted by distinctive challenges.
In this episode, you’ll learn:
[2:00] Invest in your networks early.
[5:54] Starting a company during an economic downturn: is it a good idea?
[9:43] The multifaceted role of VCs as super connectors and coaches.
[16:20] The best founders identify opportunities in the current world and articulate a clear vision of how to navigate toward a better future.
[25:34] Founders deserve investors who are wholeheartedly committed and thoroughly convinced of the startup's potential for success.
The non-profit organization that Anne is passionate about: UCSF Benioff Children's Hospital's Center for Child Protection
About Anne Dwane
Anne Dwane, Co-Founder & Partner at Village Global, has a wealth of experience with a background that includes tech company founding, venture-backed CEO positions, and executive roles in public companies. Over her 20-year career, she has successfully managed P & Ls and excelled in scaling operations from startup to IPO and building effective teams. Notable achievements include leading companies to successful acquisitions by Monster and Chegg, as well as managing P&L responsibilities for Chegg before and after its IPO (valued at $1 billion). Currently, she serves on the board of Harvard Business Publishing.
About Village Global
Village Global is a Silicon Valley-based venture capital firm dedicated to supporting amazing entrepreneurs working on big ideas. With a typical investment range of $250,000 to $1.5 million, the firm goes beyond funding, offering founders access to a vibrant community, expert guidance, and transformative introductions. Chaired by Reid Hoffman and backed by esteemed visionaries such as Jeff Bezos, Bill Gates, Mark Zuckerberg, Anne Wojcicki, and more, Village Global has an impressive portfolio that includes companies like Excarta, Simply Homes, Juno, Evisort, Siena AI, Canopy, Risk Ledger, OpenCover, Boost Capital, Atmosfy, among others.
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“We use generally what we call a ‘strong YES’ framework, which is one of us with an allocation at headquarters (there's Ben and me, and then some other investors we're adding often) think about having an allocation to go back companies. And we need one person to really be pounding the table and saying, ‘I am strong Yes for this company.’ And then we can't have a veto from somebody else.”
Gopi Rangan: You are listening to The Sure Shot Entrepreneur - a podcast for founders with ambitious ideas. Venture capital investors, and other early believers tell you relatable, insightful, and authentic stories to help you realize your vision. Welcome to The Sure Shot Entrepreneur. My guest today is Anne Dwane. Anne is a co-founder and partner at Village Global. Village Global is a seed stage venture capital firm based in San Francisco Bay Area, chaired by Reid Hoffman and backed by many industry luminaries. Anne and I are also co investors in a company called Juno. We're going to talk about some of her investments. We'll hear stories about how she makes investment decisions.
What gets her excited? When does she say yes? And what's the process she follows? Why does she say no sometimes? That happens quite often as well. We're going to talk to her and learn about her style of venture capital investing. Anne, welcome to The Sure Shot Entrepreneur.
Anne Dwane: Gopi, thank you so much. It's a privilege to be here.
Gopi Rangan: Let's start with you. Tell us about yourself. You were born in New York and now you've moved and West Coast has become your home. Tell us about that journey and how did you become a venture capital
Anne Dwane: investor? Well, I always loved entrepreneurs. Even as a kid, I was trying to think about what businesses could you start?
And I loved this early definition of what is an entrepreneur. An entrepreneur creates value beyond resources currently controlled. So it's alchemy. It's making one in one equal 11. And I just love that idea. And I didn't know anyone who started a business, really, but I got my first job. It was my first and only job out of school.
First in market research and then in brand management at Planters Peanuts and with some other people got the opportunity to propose a new business to start and within Nabisco and it was called Nabisco direct and if you can believe it's 1996 way back in the 1900s, we thought about using the internet and this group of colleagues and I pitched the CEO on formulating Nabisco direct, which would be a division that would leverage the internet to extend our brands.
And it was pretty clear that the CEO didn't really think it was a great idea and we went away and a little bit later that next week, we got a call from the staff of the CEO who said, can you come back and pitch that idea again? And we said, sure, what happened? And they said, well, the CEO was at a cocktail party over the weekend and someone said, what's.
Nabisco doing on the internet? And he said, we're going to start a whole division to focus on it. So sometimes it works out pretty well. So we got to work on that early and it was an example of intrapreneurship, I think. And I really decided It was time, especially in the late nineties, this thing, the internet might actually stick around for a while.
So I decided to go to business school and really leverage business school, I would say for a couple of things, number one is to make great friends. And I'm, you know, I would always encourage people to invest in themselves and invest in their networks early. And then came out of business school. And started a business with my study group member.
Gopi Rangan: I see how you your career has evolved. You've had only one job and all the other jobs were entrepreneurial endeavors that you created for yourself. And this is the first entrepreneurial endeavor you're talking about coming out of business school.
Anne Dwane: Yes. So it gets even funnier because I got out of business school and I drove cross country and I had accepted a job at a startup.
It was a 20 person startup. It's pretty exciting. And I arrived and the CEO said, come into my office. And I said, this is gonna be great. I'm gonna work with the CEO. And he said, I just sold the business and I actually kind of forgot that you were starting. So you're not part of this new venture. Good luck.
It's, you know, the internet is doing well. So good luck. So that was my first startup job experience, which is, you know, it didn't end well for me,
Gopi Rangan: But it didn't even start.
Anne Dwane: Correct. Can you be fired if you've never really been on boarded? I don't know, but it was one of those blessings in disguise because I got unleashed in Silicon Valley. And very fortuitously, my study group member was on a Naval Reserve weekend. So he flew for the Navy, you know, one weekend a month, two weeks a year. And he was sitting around and people were complaining about how hard it was to stay in touch with their friends to access their military benefits, like VA home loans to buy a home or whatever it is, GI Bill to go to College or school and he said, wow, if there's a women. com, which was a very popular website at the time, there should be a military. com and we should have an online community and we won't leverage technology to do anything else, but to help behavior that people are already doing be faster, easier and cheaper. Because changing behavior is hard, but kind of unleashing and removing the friction from existing behavior is a big idea.
So we started military. com and we were very fortunate to have great investors, but 2001 hit and we had to unfortunately trim back the company. We had to reduce headcount. We had to reduce costs and kind of hunker down. Does this sound familiar to today's and I'll never forget one of our board members said, well, you thought like launching an F 18 off the carrier.
And in fact, building a startup is a lot more like being in a lonely Humvee crossing the desert. And that is actually true. It's not that glamorous, right? To build these startups. And they generally take longer than everyone expects, but we ratcheted back with a great team, really focused on the community.
And we ended up making a successful business. And in 2004, that was acquired by Monster, which was in the job space. And that was a large customer of ours because lots of people come out of the military and they get jobs. So that was great. I spent some time at Monster. And Monster was, at the time, a web 1. 0 company scaling to a billion dollars of revenue. And it was fun to see a company grow like that, you know, kind of successfully, but I knew I would want to go back early. So went back early stage to a little company called Zinch and run by a college dropout, his friend and his brother. Almost like a LinkedIn for high school students and another community that would help make it a Zinch to get in and pay for college for generation Z, that's it. And my timing isn't so great because it was 2008. I saw another market crash. But the good news for all the entrepreneurs out there is these markets are the best time to be building. The bar is high. You have to have an overwhelming value proposition for your customer. And as we used to say, you have to be absolutely essential or overwhelmingly entertaining in order to be successful in these markets.
Gopi Rangan: Is it really true that it's a good time to start a company in the downturn? Isn't it hard to raise funding? Isn't it hard to get customers to pay?
Anne Dwane: Yes, it is hard. I would say the pressure creates diamonds. And the fact that the bar is high disciplines you and your team to build the very best product. And I think the secret to startup success is to create overwhelming value. For your customer and then to capture a small percentage, but the best startups aren't a little better than out there.
They are 10 times faster, 10 times cheaper, 10 times better, and that's, I think it's good to aspire for that.
Gopi Rangan: You have now become an expert in building online communities. You've done a couple of companies in that space, then eventually. You decide that you want to move closer to the investing side of the world.
You decided to start GSV Acceleration Fund, the early stage venture capital fund there. How did you make that transition or why did you make the transition in the first place? What got you interested on the investing side?
Anne Dwane: Well, I've done a little bit of angel investing, I had sold the company Zinch -with the team had sold that company to Chegg and I promised to stay a year after the IPO and then a little after the IPO, Dan Rosenzweig said, you should become a VC and he said, you love little companies and you love entrepreneurs and that's how it started and I'm so grateful to Dan for kind of pushing me out of the nest.
Gopi Rangan: Was it a big change at that time? Now it's been a few years and you're really enjoying and you've made so many investments, but at the time of making the transition, thinking like a founder, thinking like an operator, making decisions versus being an investor who's more like a coach on the sidelines giving advice and support to founders, but ultimately they make those decisions. That's a big transition. And I've worked with so many VCs who have successfully made the transition. I've also seen quite a few VCs who struggle with it. And some decide that, you know, investing is not my thing. How was the transition for you and how is your experience as a founder helping you as a VC?
Anne Dwane: It's a good question, because I think VCs can come from any background. I think that I would say there's pluses and minuses. So the pluses are, I think we are some of the luckiest people in the world to have this job. So we're meeting ambitious people who want to dent the universe, and hopefully can, especially at the early stages, help put them in business. That's really exciting. To be part of their journey. And you're exactly right. We cannot take the wheel. This is not ours. So, and that's probably a good thing. Because I'm very careful that if a founder has a question or a challenge, I don't want to say here's the way it's done and in fact on our model, which is very network driven, I will often say, I don't know, but I know someone who knows.
And generally the person to best help you see around a corner today is someone who has just rounded that corner, not somebody like me who rounded the corner 10 years ago. I mean, it was really apparent when in the pandemic people were raising series A rounds, whatever on Zoom. And I thought to myself, there is no VC in the world who has ever done this before, right?
So all we could do is lean on other people like peers. And I would say in venture, the highs are not as high and the lows are not as low because you don't own it. It's diversified. And my only hope as a VC now at this point in my career is that having seen a lot and made a lot of mistakes and have the scars to prove it, is that I can be a super connector and maybe help people frame things up a little bit to inform their decision making.
Gopi Rangan: Okay, let's talk about Village Global. This is leading up to a crescendo here. Why did you decide to start Village Global and how is Village Global different from other VC firms?
Anne Dwane: Well, when we started Village in 2017, the world did not need another venture firm, but our thesis was that many venture firms, all venture firms kind of say we have a network, but we are a network and social and professional networks have changed so many industries, but not necessarily early stage investing. It was used to be very much about who you knew and the idea that venture capitalists would sit on Sand Hill Road and wait for the deals to come to them was kind of pervasive. And we were inspired by the scout programs. By Sequoia and others, which says, Hey, don't just wait for the deals to come to you go out and try to leverage operators who are in the ecosystem who are first call for founders who are thinking about starting something early. And those people who are approximate to people, the technologies, the markets that are where the founders are, are actually best informed to make the decision about the next founders. Because we like to think that some of the founders we back if their business plan was sent to a more traditional firm, they might get passed on because they look too out of pattern. And so we really thought about that.
And then the other thing to break through in a pretty crowded environment in 2017 is we were fortunate to work with our chairman Reed Hoffman and really think about some of the world's most successful founders. And would they want to engage and back the next wave of early stage founders? And would they not just invest some capital, but lend their names to the initiative? And even in many cases, it agreed to engage with the breakouts in the portfolio. And six and a half years in, we've been really lucky that we've had more than a dozen of those epic founders participate and follow on rounds of the companies that we backed very early. And it is a thriving network of ideas and exchange.
Gopi Rangan: So Village Global is essentially built with the backbone of a strong network. And in your network, you have pretty much who's who in tech, who's who in Silicon Valley. Let's talk about, uh, your investment thesis and number of investments you make before we go into more details about startups.
How many startups do you typically invest in and what stage do you invest?
Anne Dwane: So we invest at the very earliest stages, so it can be a founder or a team with an idea can be pre revenue right alongside friends and family. Sometimes that inception stage pre-seed or seed and you asked how many we invest in and it's big, so we invest in over 150 companies in a fund.
So that might be 30 to 50 companies per year. And the way we can do that without having a spray and pray approach is those scouts that we talked about. We work with angel investors who we think are first call for founders who are starting today. And these people are early and trusted and helpful. And we work with them very closely to kind of vet the founders and then figure out how do we combine generally their Sector or, you know, their expertise, I would say with our broad network, that's a lot of companies, a lot of company, but we have a lot of help and we're fortunate to work with those amazing angel investors in our network and then over the past couple of years as some of the world's best angels went pro.
And where he's small fund, we actually have gone on to back some of those small funds. So our real goal is to collaborate with the best first call investors in the world in order to source, select, and support very early stage founders at scale. And, you know, it takes a village. Uh, no pun intended, but we think that that breadth of the portfolio, number one is good for returns, but more importantly is good for founders because of that peer based community and the opportunity to learn from one another.
Gopi Rangan: You're truly building a village here, I see. Yeah, that's right. I see you invest in quite a few companies every year. You take a thoughtful approach and you invest quite early and you invest alongside The first call investors, typically angel investors or someone else in your network who receives that first phone call from the founders and one such investment is Juno.
So you and I are investors in Juno. How did you get excited about Juno? And when did you say yes, I want to invest in this company?
Anne Dwane: Yeah, we were impressed. I like to say that founders that are compelling remind me of comedians. And the reason for that is comedians don't see a different world than the rest of us.
They just see the humor in the world and the best founders don't see a different world, but they see the opportunity in the world and they are able to explain how the world will be and how they're going to navigate to that better future. And I think that Jordan at Juno did a phenomenal job of saying that in Europe, there is pervasive coverage for people if their children, um, from birth to age 26 have a catastrophic accident or a diagnosis to have health insurance coverage and resources. And unfortunately, in the United States, that's just not the case. And from employers, life and disability insurance are ubiquitous for individuals.
But not for their children. And it is so meaningful and ROI excellent for the company if an employee's child has that terrible situation and can be supported. Both financially and with resources at the time that happens and at a time when employers have to be really thoughtful about the benefits that they add, because, you know, these are lean times and also to think about the benefits that can really matter to employees.
Juno made perfect sense and they are creating a category and then having a really solid business approach that collaborates with brokers and others in the ecosystem that could be incented to bring this new insurance product to employers made a lot of business sense. So we were compelled from the very beginning.
We did our diligence. We can, we'd like to think we can check references on people and companies in a world class way because of the richness of our network and both the concept and the team. Benchmark really well.
Gopi Rangan: I was one of the first phone calls for the founder. And when I heard the story, I was blown away.
It is shocking that in the U. S., we don't have that infrastructure available. Much like how we don't have good public transportation in the U. S., there are a few things that we are lacking, although we are easily one of the best, if not the best country in the world. And I'm delighted to see that Juno is solving that problem, bringing something that is essential to every family.
And when I saw the story, when I heard the story, I was very quickly on board to invest in the company. I'm delighted that you joined as well. Now, how are these decisions made at Village? Who has to say yes? Do you and Ben both have to say yes? Do others have to say yes? Does the founder need to convince every person or is there an exception you can make sometimes?
How does the process work?
Anne Dwane: Yeah, so we use generally what we call a strong YES framework, which is one of us at with an allocation at headquarters and there's Ben and me and then some other investors we're adding often think about having an allocation to go back companies. And we need one person to really be pounding the table and saying, “I am strong YES for this company.” And then we can't have a veto from somebody else in the veto. We wouldn't use very often. Is not, I disagree with you. The veto is, I would not want my money and my name and our firm's name attached to this, but we think it's important, especially at early stage that we are not consensus driven.
And so we try to have the best. Rigorous deliberation process so that the champion of any particular investment really has made a thoughtful and clinical evaluation and a calculated decision because these are very risky. So that's all that's needed to get a deal done. And then I would say we have a very firm belief. So once we have made the decision that we're going to back that company, we're in and the whole team is a team sport and we'll support that company.
So when one partner says yes, and it's a strong yes, the deal moves forward and you don't need to get consensus from more than that one person.
Well, anyone could raise their hand and say, there's a risk here. We should, I will veto, but that rarely happens. So the founder needs to spend essentially time with one partner.
Yeah, although we, I would say that we often bring the founders in to meet the investment team and then we all try to be as thoughtful as possible about what could go right and what could go wrong.
Gopi Rangan: Okay, we talked about Village Global at a high level. We talked about specific startups. Can you talk about some themes of investments that you're very excited about?
Anne Dwane: Yeah, we are more founder-driven than thesis-driven because we feel like at the earliest stages, we want to keep an open mind and that some of the true breakouts of the next 5 to 10 years will be in categories that don't even exist yet.
So we think a lot more about founder attributes than our thesis. And some of those founder attributes, I think, might be extreme founder market fit in the category, meaning they really understand the white space and the dynamics of the market. But then conversely, occasionally we back someone who really brings a beginner's mind to the market. We can back those people too. And I think that we are happy for people to not have a ton of experience in the category or something like that. They just have to be, I think, two things aware of it the fact that they probably don't know a lot of stuff, and they can't be naive to the risks. And the second is they have to be a consummate learner.
And that's especially true, I think, across all categories today, because so many of the categories we're in are emergent and will likely keep changing. And the pace of change is just accelerating. And one of the things that I've always advised people when they're pitching VCs is don't just state the facts and give the snapshot, show me the movie, tell me about how you've learned and iterated because for us early stage, that means a lot.
Gopi Rangan: So I see that you're open minded, you would invest in an expert who has deep knowledge in an industry and has a point of view on how that industry could change. You would at the same time also invest in a founder who has fresh thinking and doesn't have a lot of experience in the industry, but has done enough research to get excited and passionate about building something that will meaningfully change the industry or perhaps even create a subsector in that industry.
Anne Dwane: Right, and hopefully the latter category of founders has surrounded themselves with people who do really understand the market and the dynamics and sector and things like that.
Gopi Rangan: It's surprising that I've seen more companies in the latter category where naivety is actually a strength. They ask fundamental questions that changes the paradigm of how things work today.
Can you give an example of a company you invested where the founder didn't come from the industry and had fresh thinking?
Anne Dwane: Well, I'll use an example, and maybe this is a little bit different, but we met Jerry Ting at Evisort, and Jake Sussman, his co founder, and actually also at the very earliest stages, and they were law students.
Jerry Ting was a law student at Harvard Law School, and in 2018, he said he was going to use AI to work in the legal category. And what's interesting is he had such a compelling story about how he had been a summer intern and the night before the big transaction was happening, someone said to him, Jerry, go through the contracts, make sure that nothing's triggered by M and a, and he said.
Wait, you mean like I should go into files and open PDFs and scan for particular clauses? They're like, yeah, exactly. And he said, Oh my gosh, this has to be done by robots, right? This could be done by robots. And in fact, in some aspects of contract law, it's almost like we've trained the. humans use an algorithm, right?
Like to be the algorithm, right? And there he was a law student, didn't really know yet about the law industry, right? But had come from working at Yelp and internet companies and just saw that this emerging technology. And I think he was prescient about how you could apply these concepts together to make something that's really interesting.
Gopi Rangan: So here's a person who hasn't really worked in the legal industry for many years, but he knew enough about the challenges of dealing with contracts. And he realized that there's a huge opportunity here that he could go solve using technology. Very interesting indeed. I'm going to ask you a tough question.
I bet you say no very, very often. What's your most common reason to say no? And why, why does that happen?
Anne Dwane: Good question. So I would say that when we say no it's because we're not the right fit for that investor, meaning founders deserve investors 110 percent in their corner and convinced. And sometimes we just didn't get there.
And that's our weakness you know, I would say that's not on the founder, that's on us. And I would say that there's many, many businesses that are good businesses. When we accepted investment from Bill Gates and Jeff Bezos and folks like that, we really are hunting the next Airbnb, the next Microsoft, the next LinkedIn, the next Amazon.
And so we are looking for great businesses that are truly venture scale. And that's really hard to find and to be able to identify. And we're going to make mistakes in both directions, right? In doing that, but that is. A filter that we are often trying to think about how scalable is this to be that kind of big business?
Gopi Rangan: What questions do you ask to get that clarity?
Anne Dwane: Well, one is around founder ambition because many good companies will have opportunities to exit early or to maybe not swing for the fences and we really are compelled by founders who want to create these mega category creating companies. So a lot about the why matters to us when we back founders.
And then I would say, what does the founder believe about the market and the market opportunity making them so committed to going big?
Gopi Rangan: How big can this be and how soon can you get there? What's your commitment? What's your passion? Why do you want to do this? That sequence of questions around the mission of the company - trying to figure out why this matters to the founder - that kind of leads the conversation for you.
I can see that you can really get to the core of the business using this style. I want to ask you about the industry in general, venture capital industry before we conclude our conversation. You've been a founder for many years. You've been a venture capital investor for many years. You've seen the ecosystem evolve. What is one thing that you would like to change to make this venture capital industry better?
Anne Dwane: Good question. I am an optimist by nature and I do feel like the industry in some many ways is trending in the right direction. I think what I would love to see is less us versus them in tech overall. I think it's, Like in so many other aspects of life, there's polarization, tech and not tech. And, you know, I think there's an opportunity for software to provide human superpowers and to enable them. At Chegg, where I was before Village, we didn't say we're in the ed tech company. We were an education company that leveraged technology. And that way, I hope that framing makes us all more collaborative.
Gopi Rangan: Strangely, VCs invest in innovative companies that use technology to revolutionize various industries but technology is barely being used in the VC industry itself. There's some better tools, some better ways of running a VC firm, but there's a lot that we can do to give superpowers to VCs so they can automate many of those things and focus on founders instead of doing a lot of the mundane tasks. I can see the potential there.
I want to ask you one last question before we conclude. Is there a non-profit organization you are passionate about? Which one?
Anne Dwane: Oh, this is such a great question. I really appreciate you asking it. And I was introduced to a part of UCSF that works with disadvantaged children.
And I think this group really spun up during the pandemic, and they realized that they really just, you know, really have overwhelming demand for their services. And I just feel like we can have the opportunity to make sure that. Those children get a hand up. What I'd love to support is UCSF Benioff Children's Hospital's Center for Child Protection. It's helping abused victims find hope and healing.
Gopi Rangan: I understand how important this topic is. Many people don't have access to resources, and I'm delighted to see that you support the organization. For many years, I've been a volunteer at a school called AchieveKids that serves children with special needs, and a large portion of the population comes from disadvantaged families where they don't have access to resources like that.
In fact, that was the reason why I got excited about Juno, because when I met Juno, I could relate to so many different families that could benefit from having the product that Juno was building. And that would have made a big difference to all those families if it existed 10, 20 years ago.
Thank you very much for spending time with me. Thanks a lot for sharing specific examples and your own experiences from the startup journeys that you've had, and the many investments that you've made. It is an honor and a pleasure to work with you and collaborate with you and I hope to find more opportunities for us to co-invest in the future.
Anne Dwane: Likewise, founders are lucky to be backed by you. So thank you so much.
Gopi Rangan: Thank you for listening to The Sure Shot Entrepreneur. I hope you enjoyed listening to real-life stories about early believers supporting ambitious entrepreneurs. Please subscribe to the podcast and post a review. Your comments will help other entrepreneurs find this podcast.
I look forward to catching you at the next episode.