Meet Vignesh Ravikumar, partner at Sierra Ventures

Steven Loeb · February 13, 2023 · Short URL:

Sierra Ventures is an early stage firm with a focus on B2B and B2B2C companies

Venture capital used to be a cottage industry, with very few investing in tomorrow's products and services. Oh, how times have changed! While there are more startups than ever, there's also more money chasing them. In this series, we look at the new (or relatively new) VCs in the early stages: seed and Series A.

But just who are these funds and venture capitalists that run them? What kinds of investments do they like making, and how do they see themselves in the VC landscape?

We're highlighting key members of the community to find out.

Vignesh Ravikumar is a Partner at Sierra Ventures

Ravikumar joined Sierra Ventures in 2013 and focuses on investments in Enterprise SaaS, Vertical SaaS, and Digital Health/Healthcare IT. He has a background in M&A transactions for enterprise software companies, having worked at AGC Partners, a Boston-based investment bank. Vignesh holds a BS in Management Science (cum laude) and a Minor in Math from UC San Diego. Outside of work, he is an avid golfer and a big Golden State Warriors fan.  

VatorNews: Let's start from that high level of what Sierra Ventures is all about, your philosophy and methodology, where you sit in the venture ecosystem, and just really what you're all about.

Vignesh Ravikumar: Just to give a little bit of background: the firm was founded a little over 40 years ago now in 1982 and it was founded by a gentleman named Peter Wendell, who was one of the contemporaries of Don Valentine, so some of the very early investors. The firm itself, and the brand itself, has a pretty long history in venture. One of the things that happened was, when Peter stepped down in 2012, three of the existing partners at the time, Tim, Mark, and Ben, had taken over from Peter and some of the other partners at the time, and really rebooted the firm. I joined the firm in 2013, right as they were getting the Sierra 2.0, as we call it, started. 

We think about Sierra 2.0 Is, is three ways: one, we focus on early stage. So, we do seed and Series As; we'll do some pre-seeds, and maybe some Bs opportunistically, but the bulk of it, let's say 90-95%, are going to be in that seed and Series A. Two, we have a B2B and B2B2C software tech focus; we’ll do some consumer here and there but really the core of the firm is we're software and tech guys, and primarily more enterprisey software and tech guys. And so, again, will we invest in three broad buckets: infrastructure, enterprise applications, and vertical applications. The key thing to take away is that, across those three buckets, the majority of the deals are going to look like B2B or B2B2C software and technology plays. 

And then the third thing is that, since we're early stage, we joke that we want to show up early and stay late, meaning that we want to be able to help and we're always open to helping our founders. We try to be what we call the “first call VC,” meaning that when a founder has an issue and they want to talk about something that we are the people that they call, and they feel comfortable talking to us, whether it's good or bad. We want to be able to help them work through problems, we want to be able to help them do things like hire better, get their first few customers, get feedback for their product. We’re really just trying to be a strong early stage partner, that's the ethos of the firm that we've that we've built over the past over the past 10 years or so.

VN: You said you’re B2B and B2B2C, so what are the opportunities that you see in enterprise right now? Why is that your focus rather than consumer?

VR: We just know that the enterprise technology spend is very, very, very big. There is over $1 trillion of enterprise IP spend and so going into it we know there's a very big market, and it's growing. The second point is, over the years, we’ve built a lot of resources around the firm that really supplement and help companies that sell B2B. As an example, we had a large pharmaceutical company, their CTO was in our office yesterday looking through four or five of our portfolio companies, and these are companies ranging from seed deals to Series B, and these are the kinds of deals that these folks want to be able to see and want to be able to adopt and be early adopters of so that they can be ahead of the curve. And so, we've built a lot of resources, like our CFO Advisory Board, which this pharmaceutical company is a part of, to help our companies get feedback from customers, feedback on their product, and things like that. And then we're building out a program that's really trying to help companies do everything from level up their CEO with coaching to helping them think through go-to-market and how they can be more strategic when it comes to go-to-market. 

So, to summarize, it is really twofold: one, we just see the spend and the opportunity in the enterprise to be massive, and, two, we've set up the resources around the firm to support these types of companies. And so, now we actually feel like we see the best quality deals and best quality entrepreneurs, and we can help these entrepreneurs as they scale.

VN: Enterprise and B2B can be a very broad category, so drill down into some of these some of the verticals that you'd like to invest in. As a firm, and also you personally, what are the opportunities that you see there?

VR: I'll talk a little bit about the firm first and how we split it up. So, it's four partners today and, like I mentioned, it's three broad buckets of companies that we invest in. So, in the infrastructure layer, we're typically investing in things like security, big data, DevOps, deductibles, things like that. Going back to the CTO from this pharma company that was in our office, it's a good example: for them security and big data tend to be very top of mine. So, again, we're hearing from them about trends and what they’re facing and dealing with, and then we’re able to figure out what we want to invest in. My partners Tim and Mark tend to focus more on that infrastructure layer; they've been doing it for about 20 years now, so they have very deep expertise in that area. 

On the enterprise application side, think of your HR tech, your sales tech, your marketing tech, things like that. Basically, applications that enterprises are adopting to help them drive efficiency, and help them innovate on new opportunities. Again, similar concept, given the fact that we have this network of folks in the enterprise, we feel that we get an unfair advantage in terms of, not only hearing about what the problems are, but helping our companies plug into these networks to help scale their go-to-market faster than an average company would. For us in the enterprise application layer, we're fairly broad and we've spent a lot of time in this space and have some very strong success and have had a lot of experience there.  

Then the third bucket is the vertical application world; this is a little bit more recent for us, so it's something that we started doing and looking at more in probably the last five or six years. Again, the way we think about it is, where we can take software and technology and apply them to different problems and verticals? One of those examples is healthcare; we have, and I myself have, spent a lot of time looking at healthtech. We're basically trying to say, “if the world is shifting more and more to software, what are the opportunities for founders to basically go and tackle problems in these different verticals by building really creative products?” One of the things that we've noticed, and one of the reasons why we've spent time in this space, is that over the past 20 to 25 years we've found that most of these enterprises, even when they're solving problems that are very tailored to their own vertical, they buy products like an ERP from Oracle, or they buy a Salesforce, and call it more broad horizontal platforms and try to shoehorn them into the use cases that they need. To give you an example, we have a company called Enable that's doing rebate management and this is for things like auto parts manufacturers who, when they sell a product, need a way to track how much the end channel actually ended up selling and how much discount they're going to have to give. This is a process that was done on pen and paper, they have Salesforce but really they never had purpose built software to help them get better visibility, better efficiency, and track their business better. And so, Enable came in and built a vertical application to target that problem. And so, we're finding really compelling opportunities like that, where these platform companies have shoehorned their platforms into use cases that don't necessarily exactly fit what they were built to do, and we're finding software companies can take advantage of that opportunity to build something really meaningful. So, that's how we think about the three, three broad buckets. 

I spend most of my time in both the enterprise app layer as well as the vertical application layer. Healthcare is probably about 40 to 45% of where I spend my time and we've done everything from companies selling into pharma to providers to payers, and even focusing directly on patients. The way we think about the world is really around trends, and even leading up to the pandemic we had spent a lot of time looking into the healthtech world. Given how big healthcare is as a market in the US, and given how persistent of a problem it is, the experience for everybody around the table, whether it's patients, payers, pharma, or providers, should be more software driven and be more efficient, so what are the opportunities that we can find to help drive those new experiences?

A couple of areas that we spent a lot of time in early on include clinical trials, we've had some really solid successes in that space with companies like Reify Health and Deep Lens and we always have this mindset of, "let's go and talk to the folks in our network, let's hear what pressure they're feeling, and then try to find the right trends and catch the right trends." We always find that when we at least identify the right trends, then we can go do our work on which of the founders that we like, which are the spaces that we like, what are the business models that we like, and then really target where we want to invest. 

I'll just talk about enterprise enterprise applications briefly as well: the broad theme that we're seeing here, which ChatGPT highlight in a way, is something that we've been thinking about for a long time: as enterprise software evolves, the last generation of software was really built around this idea of systems of record. That means that there were better ways to capture and store data and make it easier to store that data and access that data but, given that cloud is a thing, and you have your mobile phones, you can scale up compute. There are lots of new experiences that you can generate for the end user because of the new innovations that have happened. And so, we think that things like ChatGPT are a good example of how to help somebody do something. As an example, why should you be writing your own job description? You should be able to put it into something like a ChatGPT that automatically creates the job description. For that matter, you should even be able to figure out, “if I tell you I want a software developer that has three years of experience in writing in Java," then you should be able to go out and identify candidates for me. So, we think that with this whole evolution of AI that there are lots of things that are going to enable this next generation of systems of engagement. And so, that's really where we're spending time on the enterprise app side.

VN: Our publication is very healthcare focused, and obviously a lot has happened in that space in the last three years. Where do you see that space evolving? Where do you see it now versus where it was pre-pandemic? 

VR: Healthcare has been interesting. We saw during the pandemic, and maybe coming out of the pandemic, the pace of innovation was obviously up and, more than anything else, the adoption level had really had really started to spike. We found that everybody was looking to find and try and buy new software; it's tempered a little bit in the last in the last year, but what we are finding is that anybody that has an opportunity to do one of two things, either drive throughput or drive more revenue per patient, those software products are actually very compelling for everybody across the board.

The second broad area that we're seeing in terms of trends is driving digital experience, especially in the pharma world. As an example, we invested in this company called Reify Health back in 2018; the company is building a decentralized clinical trial platform. Obviously, we think that there is a way to bring more software into clinical trials and what the company does is provide a CRM for the sites to track patients as they come in. This is something that sites were basically doing on pen and paper, on Excel spreadsheets, when a patient was coming in and it was just a very manual process. So, Reify set out to actually automate that process and bring software to that problem. Along the way, what we found was that we built this network of sites, and we could actually deliver decentralized clinical trials, which during the pandemic saw a massive, massive surge of interest just because trials couldn't be run in the health system. Post-pandemic, we're finding that the demand has continued because pharma companies realized, one, they needed to rethink the way they do clinical trials, because it's a more efficient model to recruit in a decentralized manner, but, two, you need to provide a digital experience to these consumers and to these patients to be able to recruit them and actually get them into your trials. There are a number of other areas, as well, for example we think that medical devices are going to have some sort of digital experience going forward and so there needs to be tools to help companies build and manage and maintain those experiences.

To summarize, what we're seeing in the healthcare world is that the overall overall pace of pace of adoption has tempered a little bit but if you're in the two big pockets of oxygen, one on better revenue capture, and, two, building and driving new digital experiences, there's still a ton of demand and interest for companies in those two areas.

VN: Let's talk a bit about your fund. What size is the fund that you're investing out of currently? How many investments do you make in a typical year?

VR: The current fund is $220 million and we're typically writing checks between about $1 million to $6.5 million, maybe up to $7 million. We'll do anywhere from 12 to 15 deals per year, that’s is a good pace for us. Of those deals, we’ll probably lead about 70% them.

VN: Talk about traction for the companies that you invest in: when you're investing in a seed and you're investing $1 million, what do you want to see from that company at that point? If you're doing like a $6 million Series A, what traction do you want to see at that point? I'm sure there's a very big difference between those two.

VR: There is a difference in some ways, but in many ways it's not too different. The way we really think about it is, number one, we're betting on the founder and the entrepreneur. Even for most of the Series As, obviously there is more traction relative to a seed stage company but, in the grand journey of building a really, really big company, these things are still early. And so, we have to find a founder that we enjoy working with, but who we think we think can scale. 

The way we think about our founder profile is around five dimensions: one, we want to find founders that have this massive level of customer obsession and depth of understanding of the space they're going after. Two, just an extreme level of attention to detail. Three, we want founders that have that ability to drive execution and be disciplined from a financial perspective; it's just really important that a founder has a solid grasp of their business. They don't need to be finance experts, but they need to be disciplined. The fourth bucket is around their ability to hire: we think that the best founders, that's where they're spending most of their time and, for the best companies, you've got to make sure you have the best people around you to really be able to scale. So, that's something we look at very closely. And then the fifth bucket is around, do they have the ability to tell a story? Do they have the ability to sell a vision? As we look at the founder and we really spend time on those five qualities, whether it's a seed or Series A.

Turning to traction, with the seed stage company, we focus much more on that first bucket, that customer obsession and depth of understanding. We're trying to understand what unique insight this person has. Why are they building this? Why are they the right person to build this? And why do they think there's a big opportunity? Can they articulate a big opportunity? How did they go out and validate this problem? Did they just wake up one morning and say, “hey, I want to build this,” or did they spend hours talking to customers? We really spend time thinking about that customer obsession and depth of understanding on the seed side. Then, on the Series A side, it's more about if this person has a very good understanding of who the customer is, the ICP, and if they know exactly where to go. How well have they executed against plans that they set for themselves? Do they have a good sense of where they are on the journey to product market fit? Do they have a good understanding of what a roadmap needs to look like to really help this company scale to the next level? We start to look at that next layer at the Series A and the ideal company at that stage is one that understands the ICP, knows who they're selling to, knows how to get in front of that person, and now really needs the dollars to help them start scaling and put the right pieces in place from a sales and marketing perspective to take them to that next level.  

To put it into numbers, we don't really like to say things like, “if you've hit X million in ARR, you're now a Series A company versus seed stage company,” but, typically, a seed stage company for us will maybe have like a couple of design partners, or maybe a couple of pilot customers, maybe a couple of paying customers, but it's still relatively early. For a Series A company it's really more about, do they have 10 or 20 customers and have that repeatability around those customers in terms of use case as well as willingness to pay? Who's buying it? We tend to look for a lot more of the repeatability at the Series A, that's the big difference between the stages.

VN: Do you invest pre-product? Or do they have to have some prototype or something? I’m guessing that at the Series A they definitely have to have a product.

VR: Definitely at the Series A they have to have a product and, again, definitely have to have some customers. At the seed stage, it depends a little bit: a lot of it hinges on the founder and the quality of the founder’s insight. We've done deals, as an example, in companies like TeamOhana and Redlock where it was just two founders in a PowerPoint. We've had some really good success investing at that stage but that tends to be more of the exception than the rule. So, we would like a founder to have at least some level of product and some level of ability to articulate how they're going to do what they're going to do. At the end of the day, as I go back to that founder spider graph, it really comes down to understanding where the founder pegs on those five axes, more so than if they have a product or they do not have a product. I mean, having a product is really just another indication of their ability to execute, but if we find a founder that’s super deep in the space, really knows what they're talking about, has a great technical co-founder, we're more willing to take a risk on that founder to actually go and build and execute on the product than we would somebody that doesn't come from the space.  

VN: The third bucket after the founder and product would be the market. So, how do you determine product market fit? What’s your due diligence there? How do you determine that there are actual customers out there who are going to use this product?

VR: We have this phrase internally that we always want to be prepared mind investors. And so, for the sectors and spaces that we're going after, usually there's been some work that's been done by us. I'll just give you an example on the clinical trial space: before we invested in Reify, we probably looked at five or six companies, but the reason we made the decision to back Reify was that within our CFO Advisory Board we had probably five six CIOs from very large pharma companies, and every time they'd come in to do a briefing with us, they'd be like, “Man, all this stuff is cool, but we just have this big problem around clinical trials.” And so, you just listen and you hear from folks about the problems that they're dealing with and that always starts to give you an indication of where the puck is heading. Again, we have this similar ability in other verticals as well as given the breadth of the network that we have around the firm and so that's the starting point. Are we hearing whispers of this problem that keeps coming up? Are we hearing whispers from the really smart technical folks in our network around some innovation that's happening in the cloud?

The other part of it is that we really rely on the founder. This is where that depth of understanding and customer obsession that the founder has becomes really important. What is the work that they've done? Because if they can be like, “I talked to 50 customers before I showed up and talked to you,” we'll go in and be like, “Can we read through the notes?" and then we'll go into our network and just validate some of the things as well. So, usually, it starts with those whispers around the network about problems they have, but then the second part of it is to really rely on the founder and really understand what work the founder has done to validate their own early signs of product market fit.

VN: Let's talk about the valuations. Especially when thinking about healthcare, we all saw that during the pandemic things basically exploded, especially for digital health. Every company was getting funded, valuations were getting huge and then it all popped last year. And I feel like that's true for most verticals as well. So, where do you see now in terms of valuations? Where do you see companies who raised money previously? Where are they now that they have to raise another round? Where does the market look like now that things have really cooled down?

VR: The best way to answer this is maybe talk about it by stage. At the seed stage we're finding it is still very hot; valuations have definitely come down but deals are still getting done. We're probably talking about a difference of maybe like 5% to 15% additional dilution that founders are taking now than they would have taken maybe 12 to 18 months ago. To put that into perspective, we're seeing seed stage deals being done anywhere from an $18 to $15 post. There’s still enough dry powder, there's still enough of a long term horizon where those deals are getting done but, again, there's definitely a little bit of a dip in valuation. At the Series A, what we're finding is, and this is true for the Series B and Series C in some respects as well, the top 5% to 10% of companies, those deals are still extremely competitive. People are still chasing those deals down and want to put dollars to work. And so, you're finding that those deals are still getting done at a pretty significant premium but, for the most part, we're finding that valuation expectations, even for companies that have a couple million bucks in ARR, have come down pretty dramatically and there's a little bit of a sense of a pullback at the Series A; those rounds are just taking a lot longer to get done than they were then they were and that's really been the big, big change in the Series A. They're getting done but longer and at slightly lower valuations. 

The Series Bs and Cs are really the most challenging because a lot of these were companies that raised As at pretty hefty premiums relative to where they were. What we're finding is that a lot of these companies are basically taking the approach of, how do we cut burn? How do we lengthen our runway? How do we grow efficiently and try to find a way to grow into that valuation, or grow close to the valuation? So, that's been a big, big, a big change in the way these companies are operating. 

My personal sense is that the Series B and beyond market is going to be pretty icy through this year. We're hoping it starts to thaw by the end of this year but our take is that 2024 is really when you want to be raising and most investors are advising their companies to try to go out and start fundraising in 2024.

VN: So do you see companies starting to take down rounds? Like you said, they're trying to extend the runway if they can, but if they can't, and they need to raise that next round after they raised that big seed or Series A at that big valuation, are they taking that down round just so because they have no other choice?

VR: That's been interesting, and this has been a debate I have been having with a number of friends. I don't think we've seen the bulk of those deals happen just yet. There are just so many rounds that got done in a pretty compressed timeline over the last couple of years and the size of these rounds are still fairly large that most companies had a pretty healthy balance sheet last year. Most of these companies will try to find ways to extend out cash this year; probably by the second half of this year, maybe early next year, that's when you'll really start to see companies that are feeling the pinch go and take down round but, until then, they're trying to use the cash that they have, cut burn, drive runway farther, to basically try to avoid those situations. So, I don't think we've seen it yet; it's happened in some situations, but doesn't feel like it's very common just yet.

VN: It seems like what's going to really happen is that for those companies got these big valuations, this is going to be a time for them to prove themselves. Are they worthy of what the valuation that they got? If they are, they'll continue to raise money, and if they're not, then it's going to separate the wheat from the chaff. 

VR: That's exactly right. That's exactly what we're seeing. To that point, that's exactly why investors are pushing these companies to grow more efficiently. The thought process is that if we can show efficient growth going into next year, even with multiples down, you'll still get a premium because investors can see an upward trajectory if you increase spend on go-to-market. This is going to be a big year for a lot of companies to prove themselves, although it's a challenging year to do that as well, just given that sales cycles themselves are getting longer for selling software. So, this is going to be a pretty interesting year to see how a lot of these companies fare.

VN: You mentioned some companies that you've invested in, including Reify and a couple others. It'd be great to hear about some of the companies you've invested in and some of the success stories. If you want to talk about those companies, or if you want to talk about some others, whichever you prefer, but what was it about those companies, in particular, when they came and pitched you that made you want to invest in them?

VR: I'll start with the older companies first, including one company called Phenom, which is in the HR tech space. Think of them basically as what Marketo is to Salesforce, these guys are to the ATS. So, they have a CRM for the recruiter, they have a tool to help companies build the market better to help bring more candidates in the door, help with internal mobility, provide reporting and analytics for execs, and things like that. Basically, the whole goal is to create a better way to run your talent acquisition function and provide a platform that’s just way, way better than what an ATS can do.

When we invested in the company, this was probably back in about 2015, it was still early, probably mid seven figures in ARR. Since then the company has scaled really nicely and is over nine figures of ARR today. Really, the thing that stood out the most about that company was, one, the quality of logos that they were capturing at the time, and, two, more importantly than that, the founder just had a very, very clear perspective on the category he wanted to build and why this problem existed. He just understood the nuances of why the ATSs were a dying business and why you needed a layer on top of it. Hearing the founder, Mahe, we really just appreciated his tenacity, his product vision, and his sales instinct, especially for a first time founder. That was what got us excited to invest in the company. Obviously, it's been a successful investment for us at this point and, again, as I meet founders, I always try to frame them in the context of, do they have that vision? Do they have that ability to articulate what a future big company looks like? Mahe just did a really, really good job of that. And, looking back on it, the other thing that he's done really well is just extreme levels of financial discipline; really never got caught into this whole growth at all costs mindset and that served the company really well over the past few years.  

I'll talk about Reify, which was at a similar stage when we invested; we led the Series A back in 2018. I talked a little bit about what the company does but, just as a refresher, they're building the platform for decentralized clinical trials. This one was a little bit different in that we had a thesis going into the space of what parts of the clinical trial stack we liked, and what parts we didn't like and, as I heard the story from Ralph, it was very obvious to me that he really understood exactly where they needed to be, and exactly where a software company could fit. The second part of it was, we had actually connected him with a couple of the pharma CXOs on our advisory board and we just got glowing reviews, not only about Ralph but about what they were building. And so, getting those two data points, it was an immediate, “we're definitely going to do this deal.” The thing about Ralph and Michael, the co-founders, that's been phenomenal is that the two of them have just really had a really phenomenal ability to be methodical about how they've approached the problem. This is not an easy problem to solve and you're probably seeing so many companies pop up in the clinical trial landscape in the last couple of years. Even before Reify, there were a number that didn't work out, but the thing that these guys really understood was how to be methodical and how to build a company in a way that doesn't stretch them too thin, number one. Number two, how do they really and truly build differentiated software to tackle problems for the space? As I look back on what they really did, and what really got us excited, they just understood the customers so, so well, and just like had this level and depth of understanding around the problem that most other founders just don't have. That was what got us excited, and why we did the deal at the time. 

The third investment, and this is a little bit more recent, is a telehealth company called Lemonaid Health,  which recently sold to 23andMe for about $400 million. You want to find a founder that has that ability to execute, has that financial discipline, which they had definitely accomplished when we were looking at the deal, but we also want to catch the right trends. This was a deal we did in early 2021 and one of the bets that we wanted to make, and we thought would make sense, was that while we knew that there had been a spike in telehealth visits, there was a question: was this telehealth spike temporary or would it persist? Our belief was that, as Gen Z and Millennials are becoming the bigger consumers of healthcare over the next five to 10 years, that there was always going to be a need for a platform that managed telehealth, as opposed to companies like Ro and Hims that were really more focused on things like erectile dysfunction and hair loss, and more of the consumer problems. We felt that Paul really had a vision for how to transform primary care and that's what led us to invest in the company. They had the right financial discipline and execution at that point we did the deal but it also fit our thesis around the tailwinds of the world. And, obviously, that worked out well for us. 

To summarize, there are three key themes that we think about: one is that founders are able to articulate a big vision and tell a really compelling story for the future. Two, do they understand the customer at a very, very deep level? And then, three, are they catching the right tailwind at the right time? Because timing is everything when it comes to early stage investing.

VN: It’s funny what said about the clinical trials: I was actually at one point last year getting an email or a pitch about a decentralized clinical trial company at least once a week. So, that's definitely a space that saw a huge increase during the pandemic. 

VR: A lot of these companies, honestly, were a little bit reactive. With Reify, I talked about the site software that they built, but the beauty of the model was that it actually acted as a decentralized network. Because you have all these sites that are using your software, you can spin up any site that's using the Reify platform on demand for a given trial. And so, the fact that we had the foresight to be more of this network, well before the pandemic hit, put us in prime position, when the pandemic hit, to run some really, really critical COVID-related trials. That's what helped us get to the scale that the company's gotten to at this point. There are a lot of companies that obviously have really interesting technology and have really interesting ideas but, at the end of the day, what we're finding is that the tech is great, and obviously you need it, but distribution is the most important thing. Having that massive site network is what gets a pharma company or pharma sponsor excited to work with you as a business. That's why we think that Reify really has a very, very strong lead in the market compared to some of the other folks that are popping up now.

VN: Talk to me about yourself a little bit. Tell me your story. What was it that led you to venture? Why did you want to become a venture capitalist 

VR: As I mentioned, I joined the firm back in 2013, so I've been with Sierra for about 10 years now. I was a former investment banker before I joined; we were primarily doing mid-market M&A for software companies and I'd worked on a Sierra transaction, and that's how I connected with my partner Mark who gave me a chance very early on to see if this industry worked for me. 

I'm a little bit of an odd duck in that I always knew that I wanted to be an investor: I ran a small student endowment fund when I was in college, so this has been a lifelong passion for me, since even high school. More than anything else, it was just very interesting conceptually, and it just always stuck with me. Candidly, I didn't know much when I joined Sierra and it was just something that sounded really interesting and it seemed like a really good place to try to learn about something new and that's why I joined Sierra early on. In the first maybe two to three years, the thing that I really learned the most, and the thing that I've really enjoyed about early stage is, one, the breadth of companies that you see really fits my personality well. I love being able to go talk to a healthcare company in the morning and an enterprise software company in the afternoon and then a robotics company in the evening; just that breadth of type of company, and the types of founders and the quality founders, you're just like very mentally stimulated all the time. Personally, I just absolutely love that. The second thing is that the problems that you deal with are also just so multifaceted: you may be dealing with a hiring problem with one company, you may be dealing with a product company with a problem, you may be dealing with a fundraising problem with another. So, you just deal with so many different types of challenges and things that these companies need help with and that ability to wear a bunch of different hats is what gets me excited. 

Especially working with early stage companies, it takes a ton of work and so I feel like you have to have the passion and the willingness to put in the work but also, you just have to enjoy it, otherwise it's not really possible to put in the level of effort that's required. I've always wanted to be an investor but I've always found that I get bored when I'm doing the same thing all the time and so early stage turned out to be just a perfect fit for, for who I am as a person.

VN: Is there anything else that I should know about you or the firm or the space you invested in? Or anything else that you want to make sure people get from this?

VR: We're always looking to meet great founders, and we’re happy to always take cold emails as well. So, for any readers please feel free to reach out at Obviously, the warm intro is the best path, but we always check our inboxes and if a founder has a really compelling idea we'll always take a look. 

I'll just end with one interesting anecdote of a company that fits the cold email bill and actually turned out to be a pretty successful investment. We invested in a company called Applitools, this was probably back in about 2016 or 2017, and the founder actually was in our building meeting with another customer and saw that we were in the building and actually walked upstairs and just tried to get a get a meeting with us. We spent five minutes, told the guy to send us an email, the founder followed up and we ended up doing the deal probably about two, three months later. The reason I mentioned that is we have this hustle mentality and so it doesn't matter where the opportunity comes from, we're always going to take it seriously. We're going to spend the time and we're always looking for the next great founder.

Support VatorNews by Donating

Read more from our "Meet the VC" series

More episodes