Dr. Silvia Mah, PhD, MBA, is the founding partner of Ad Astra Ventures, an investment firm with an exclusive focus on women-led innovations. She’s the founder of Stella Labs, an accelerator for women-owned businesses; founding member of Stella Angels, a female angel investment group; Investment Committee member of Next Wave Impact, a social impact venture fund; and an angel investor to over 30 startups who have diverse founders on the leadership team.

We highly recommend listening to the full conversation below:

But if you’re looking for some fast wisdom, here are the three main takeaways.

1. Make impact part of your DNA.

Silvia: "When founders come to me and say, “I want to give away part of my revenue, and that's my impact”. I'm like, “It can't be that.”

If it's so tied to revenue, what about if you don't have revenue? What are you going to do? So I really encourage entrepreneurs to make impact part of their DNA. The DNA of their company is impact. So it's not that you're saying, okay, the DNA of my company is this, oh, and by the way, I have to get this data for impact. It's more of like, the DNA of my company needs to be connected with this impact metric of some sort. Because, no matter what, I have to communicate revenue and impact at the same time, and even if I'm sold, that DNA stays there, and that impact stays there. Because that's very important to me, as an investor, if I know that you're going to sell or you're going to get acquired, or you're going to go IPO, whatever, all those options that are out there, right, there's not only three, I want that impact to stay with the company. So if it's part of their hiring processes, great, make that the DNA of your hiring process, not just oh, and by the way we do this, or revenue, great, and by the way, we give away. No, it's like, why is this important to you, and making sure that it's part of your sustainable growth of your company?

That DNA piece is not just important to me. But to your customers. If you're b2c, If you're an e-commerce or CPG business, that consumer is a conscious consumer, and they will want to know that impact statement. So that's part of your DNA: how do you source it? How do you know all the stuff that's important to them? So that's part of your marketing. If you’re b2b, you're going to be aligned to that business that really cares about sustainability. And they're gonna be like, okay, our sustainability is tied to your sustainability. So we might as well have this path of data analysis or data gathering, because you are seeing this as a win-win for both of you and a win-win in your values, right. So you want to have values aligned, customers, b2b. And that helps you to be more successful."

2. Product-market fit and coachability are key.

Silvia: "Of the businesses that have not worked, two things come up. One is not having that product-market fit. If you don't understand your product-market fit, it just won't work.

Whenever there's not that great product-market fit, so that you have that churning of customers that absolutely love your product, that's when it gets challenging. Uqora is a great example: huge community of people that say: this is transformational. I want more, and I want to tell others exactly how I feel about Uqora. When it's not that, when it's like a smaller product that I've invested in, and people are not talking about it, you don't have those champions, that's when it becomes challenging. So that's one piece of it.

The second one is a coachability of the founder, that “I can do it myself. I don't need any advisors. I'm good.” mentality. And they chug along. And they're doing great work, but they just can't do that exponential growth in the right way. The more that a CEO and a founder can really know that they can't do it all, that they have to bring in the right people, understand their gaps, understand their strengths, build on the strengths; when that is humming, you're like, “yes, I have a great team. I'm coachable, I can bring in different people.” An investor says, “Hey, why don't you go down this route actually, don't make this decision”. And they say, “Okay, I'll listen to my investor or listen to my mentors, I won't make that decision.” And they make the better decision. Wow, that's when you see that company keep on going. When they don't listen, it's just harder for them."

3. Talk to your customers and challenge your preconceptions.

Silvia: "One thing that I'm pressure testing is something that I've seen over the years, and it's something I’ve realised is actually a theme and a trend. When you ask a founder, “Have you done any interviews with your customers?” And they're like, “Oh, I'm good. I'm gonna do my Kickstarter. I'm gonna have a party and everyone's gonna support us, because we have so many friends.” I'm like, okay: yellow flag.

But, if you ask them and they say, “You know what? Yes. We have sent out a survey on multiple different social media things, and we actually tried to weed out our friends, we know where they're coming from, and really understand the data and say, this is exactly where we need to be. And actually, we need to pivot a little bit about how our preconceptions were failing us in understanding truly our customer, my perspective then is, you're gonna get there. Because you're asking about the super early indications. They might not have product-market fit at that time. But they're asking the right questions, instead of just saying, “I got it”. If they’re not asking those questions, I think, wait a minute, you're never going to get to product-market fit.

But if you do ask the right questions, and if you do pivot, and if you do take those questions and those answers and those insights, and motivate yourself to change that product in a certain way: wow, I know you're going to get there. So I think it's more also about investing in the jockey, not the horse. Is that coachability? Yes, you can pressure test it. And that's one piece. And that product market fit. You can also pressure test that by saying, how does that jockey, take the feedback that I give them on the product, and really understand that there are going to be flaws in your product and be okay with that. Because that product-market fit, you'll have to tweak it a little bit, not yourself as the coachability factor. But that product needs to be tweaked or needs to be marketed in a certain way. And when they have those critical questions and that great conversation with me, I have more confidence that they're going to get there. We might need a couple more sessions with them, to really get that product-market fit, but they're open to understand it."

Read more about SyndicateRoom’s unique data-driven approach to investing in startups here, follow us on Twitter here and follow Silvia here.

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