Pioneering Women in Venture Capital: Kathryn Gould

I met Kathryn Gould longer ago than either of us want to admit. Kathryn has been the founding VP of Marketing of Oracle, a successful recruiter, a world class Venture Capitalist, a co-founder of a Venture Capital firm, a great board member, one of my mentors and most importantly a wonderful friend. During her career she made a big point of not telling you: she was one of the first women Venture Capitalist’s in Silicon Valley (along with M.J. Elmore and Ann Winblad) – “I’m just a VC.”  Or one of the first women co-founders of a VC firm – “I co-founded a great firm.” She was twice as smart and just as tough as the guys. She has been a mentor and role model not just for a generation of women VC’s and CEO’s but for all VC’s and CEO’s – and I’m honored to have been one of them.

One of the reasons I took up teaching is my strong belief that it’s incumbent on all of us to make those who come after us smarter than we were.” So when I heard Kathryn gave the University of Chicago commencement speech I suggested that she reach out to a larger audience and share her decades of experience.

Her response? “The last thing I want is a bunch of people bugging me while I’m growing my grapes, flying, painting, playing music, and generally goofing off.”  I pointed out that, “Now that you retired, what happens to all the knowledge and experience you’ve acquired?” She still demurred so I gave it one last shot. I sent her an email saying, “When you’re gone everything you learned goes with you. This really is bigger than you. I have two daughters starting careers and nothing could be more inspiring than hearing your story. You really ought to share your journey.”

So for the first time ever, she has. Here’s Kathryn’s story.


Why Give a Commencement speech
One of the more fun things I’ve been asked to do lately was give the commencement speech at the University of Chicago Booth School of Business in June 2014.  What I didn’t tell them before, during, or after the talk was that I’d never gone to my own University of Chicago MBA graduation, nor had I gone to my BSc in physics graduation at University of Toronto.  I’ve never been big on pomp, and I had fun jobs I wanted to go to right away after each of them.  And to be fair, I wasn’t summa cum laude in either case.  I was merely respectable, so there was no appealing ego trip involved.  Anyway it was high time I went to a graduation.

The most personally interesting part of writing this speech was thinking about what I could say to the young women that I wish I’d heard at their age. (I heard nothing).

So, for the first time, I thought hard about what it was like to be a woman in a man’s business.  Not thinking about it earlier was a survival strategy—because if I’d thought about it, I’d have wanted to TALK about it, and that would have been stupid. I was working and competing with men daily.  And successfully. And the truth is, I like working with men. Being a physicist-turned-engineer, I have very little experience working with anything but men. So when members of the press or militant feminist types would question me about this stuff, I would avoid and be annoyed. Now that I’m retired I can speak out and let the chips fall. Still, a nod to Sheryl Sandberg for saying her piece while in the thick of it.

In the aftermath of the speech, I got the most resonance in two areas:

1) make unconventional choices that fit YOUR OWN aspirations

2) from women appreciating the advice to go around obstacles, and enjoying hearing from a fellow ‘dragon lady’

Actually it wasn’t “dragon lady,” it was a stronger, less feminine term — “Ball Buster” — but, hey, I couldn’t say that in a speech.  Reason I know is that I’m still very close to most of the former CEOs from my boards. I ran this speech by a couple of them.  Over time they had heard me referred to as that other term. They would jump to my defense – and they report that the people who said this had never met me –it was just the “word on the street.”  Insidious, yes?

Anyway, mine is a study in making unconventional career choices (not that I recommend everybody go be a recruiter for a few years!), and searching for what you’re great at, and meant to encourage women to go right through those walls.

So they call you a “dragon lady”; so what?!

Here’s the speech:

2014 University of Chicago Commencement speech ‘Your Great Adventure’
“I’m so happy to be here today:  First, to help you celebrate your success thus far, and more important:  to celebrate your last day of doing what is expected of you —now each of you embark on your own great adventure—there is no ‘expected’ path from here on. You get to create your own history. No more tests, get into this school, get into that class, get this degree—now the real adventure begins. The second reason I’m glad to be here today is that 2 years ago, when Dean Kumar first asked me to do this speech, I wasn’t sure I”d even be alive, so I had to pass.  More on that later.

So, about your adventure:  should you have a plan? Maybe. But don’t follow it. Planning prepares the mind, and chance favors the prepared mind, but chance usually messes up plans!  When I was where you are, 36 years ago (can ya believe it) I didn’t have a plan—but I did have an aspiration: I wanted to go to Silicon Valley and I wanted to work in startups.  I had no idea how I was going to get from here to there.  I was completely unprepared!  We had literally one entrepreneurship course here in the mid 70s—taught by a guy who commuted in from Silicon Valley.  Compare that to now—with our superb entrepreneurship curriculum, and I understand 70% of this class has either an interest or focus in entrepreneurship.

Chance Favors the Prepared Mind
So here’s how it happened for me.  I had had a love affair with computers since I was 18 and a freshman physics major.img013

Computers were so different from now—arcane, annoyingly difficult— and interesting. But they weren’t really in Silicon Valley at the time—they were in Boston, Minneapolis, New York. So going to Silicon Valley wasn’t an obvious move at the time. It was the invention of the microprocessor that made it obvious for me. I quit my good job here and moved to the valley. Most people thought I was nuts.  I had no idea what I was doing—just that I had to be there, and in a startup—so I took a job with the smallest company that made me an offer (passing up Intel, Tandem and Apple). It wasn’t a great choice, but I was THERE. But then, one our customers was Larry Ellison, with this little company that wasn’t even called Oracle at the time. I loved what he was working on (thanks to perspective in data management from my large company experience here—that prepared mind thing).  So I joined Oracle when it was about 20 people, eventually becoming VP Marketing. And it was an amazing time. Larry was the best entrepreneur I’ve ever known, and completely unconventional…

What can you learn from this story so far?:

Put yourself in the way of success—get in front of an important wave and ride it.

Gravitate to what’s new.

Don’t be afraid to take a step down (Oracle was a $1 Million business, I had been marketing manager for a $100 Million  business).

Build Your Skills Not Your Resume
Eventually I left Oracle, wanting to do another startup. Problem is, startups that have world changing potential are not that easy to find. I wanted another Oracle, not any old startup. So I did something completely crazy and unplanned—which looks brilliant only in hindsight! I noticed that I loved looking for a job, even tho I didn’t’ find a company I wanted to join. I liked meeting people, hearing the company plans, learning about their technology, figuring out if it was for real—all that was fun. How could I do that for a living? The answer of course, was Venture Capital, but that was not in the cards—as yet. I had met a few exec recruiters in the process and thought what they did was similar and interesting.  So I started an exec search firm as a creative way to look for a new startup.  Turns out that I quickly became one of the few best recruiters in the valley for CEO and VP levels, got to work with the best VCs and their startups. And who would have guessed—perfect preparation for the VC business. I ended up doing that for 5 years, and in the process saw about 80 startups in various stages of success and disarray. I developed a deadly accurate intuition on people, an unbeatable set of contacts, and loved working for myself in my little firm. By the 4th year, VCs were asking me to join them, partly for recruiting help, but more because I kept introducing them to startup investment opportunities. As you’ve heard, it’s excruciatingly hard to get in to the VC business, and there I was. Because I”d built some unique skills.

Plus, I had learned some stuff that you don’t get in business school:

  • How to cold call –adrenaline, real time, 3 seconds to grab their attention—learn this!
  • Also the adage As hire As, Bs hire Cs—absolutely true—be careful of the company you keep,
  • And what goes around comes around.   Help people with their careers, their ideas, contacts—and I’m serious, good things come back years later.

I also learned that the first time without a paycheck is a little scary.

Find Your Obession
I joined VC firm Merrill Pickard in 1989. My first IPO wasn’t until 1995—the VC business takes patience. Two companies I helped start in 1992, DCTM and Grand Junction Networks both became Stanford business school cases and very valuable, successful companies. I was on the way to my lifetime IRR of 90%. I loved the business, and I was good at it.  But then, trouble. My two best partners went off to start Benchmark Capital, very successful to this day, so my firm was going to blow up. I went Boogie Boarding where I do my best thinking. I thought, gee, I could already afford to ride waves the rest of my life. That might be neat. But I couldn’t do it. I loved the business, couldn’t stop.  So I started Foundation Capital in 1995. I loved starting my own firm, doing it my way.  We brought in all operating guys—all had done startups, all had technical backgrounds. In 5 years we were one of the top firms in the Valley by any measure.  I had found my obsession.

It’s Not the Calls You Take, It’s the Calls You Make  One of my sayings
You are the creator of your destiny. In whatever business you’re in, there is always so much coming at you that you can stay insanely busy just responding.  Don’t do that. Always think about what is your agenda, what do you want to make happen, what do you want the future to look like.  This is not so easy.

Go Where the Action Is: It’s not over in the Valley
Now 35 years later, should you still move to the Valley (or Hollywood, or London, or Chicago!—or wherever the action is in your area of interest?). I can’t speak to the other places, but I”ll tell you what, it’s not over in the Valley.  From electric cars to drones, DNA sequencing to robotic surgery, enterprise software to social media –the size and variety of these markets makes the Valley of my early days look bush league. There’s no end in sight. The valley startup culture and talent pool is unique in the world.  If you think maybe you should go there—maybe you should.

I retired in 2006. My husband and I bought a vineyard—so I’m a beginner again!  With another startup!

A Word to the Ladies Here
I understand a third of the class is women. I have always said, with an annoyed attitude when people ask, that there are no obstacles to women these days, just look at me! That’s the safe way to answer, right? But it’s not entirely true. One of the gifts of talking to you ladies here is that I forced myself to reflect on this.  I’ll just mention two obstacles that hit me—neither of which I even reacted to at the time, just accepted.

First Obstacle
I wanted to go to Caltech, but they didn’t take women undergrads until 1970. I wasn’t mad about that; I just thought it was my fault for being interested in guy things. So I dated a Caltech student and got to use their computer—first computer I ever met too—a monster. Structural obstacles like this are over with for you.  Good riddance.

Second Obstacle
Remember that business of starting Foundation Capital when my first firm blew up?  I did it because I didn’t have a choice—couldn’t get a job.  Really.  I spent a couple of months talking with the few VC firms that I was willing to join. (yes, I was picky) It became clear it was going to take a long time to get into one, and I didn’t have a long time.  I didn’t want to lose my momentum. Mind you, I was one of the top handful of VCs in the business at the time. Not on the Midas list yet, because it hadn’t been invented, but anybody could see that my results were heading toward extraordinary. I have to think that a guy with my numbers would have been snapped up pretty fast.  For me, starting the firm and raising the money was way faster. Don’t you think that’s stunning? A pretty big fat obstacle. So we went from Boogie Board to money in the bank in 6 months. Not that I’m sorry—it turned out great.  But you ambitious women will surely face something like this in your career. Just go around it!  There is always a way.  Note on the VC business, only 4% of senior VCs are women, according to Fortune Magazine. I don’t think it’s changing anytime soon either.

Now to be fair, consider your advantages:  you’re much more memorable than most of the guys, they won’t forget you, and there is a self selection:  the men who have the guts to do business with you have the extra self confidence to be more successful.  The guys that wanted me on their board of directors had moxy—because of course they had heard all the crap about how I was a dragon lady (all ambitious women get called that as you know) and they still went for it. Who knows—could be why my companies were so successful…

I often walk among my grapevines and think how grateful I am for my life right now.  But if the vines had come first, without the adventure and hard work, it wouldn’t be nearly as sweet. So that’s my story so far—but it’s not over yet, because the cabernet is really good!

Tending a New Crop in My Next Venture

Tending a New Crop in My Next Venture

So now, for each of you, go create your own unique adventure.  You are done preparing—go do it! Make a plan, but don’t stick to it. Let chance favor your prepared mind.  Break rules, find your obsession, be extraordinary!”

View the speech in its entirety here

Getting Lean in Education – By Getting Out of the Classroom

This week the National Science Foundation goes Lean on education by providing $1.2 million to educators who want to bring their classroom innovations to a wider audience.


The I-Corps program started when the U.S. National Science Foundation adopted my Lean LaunchPad class. Their goal was to train University scientists and researchers to use Lean Startup methods (business model design, customer development and agile engineering) to commercialize their science. Earlier this month the National Institutes of Health announced I-Corps @ NIH, to help scientists doing medical research take their innovations from the lab-bench to the bedside and accelerate translational medicine.

This week, the NSF is announcing the next step in the I-Corps program– I-Corps for Learning  (I-Corps L).  This version of I-Corps is for STEM educators – anyone  who teaches Science, Technology, Engineering and Math from kindergarten to graduate school, and wants to learn how to bring an innovative teaching strategy, technology, or set of curriculum materials to a wider audience. Following a successful pilot program, the NSF is backing the class with $1.2 million to fund the next 24 teams.

The Problem in the Classroom
A frustration common to both educators and policymakers is how difficult it has been to get new, innovative, education approaches into widespread use in classrooms where they can influence large numbers of students. While the federal government and corporations have dumped a ton of money into STEM education research, a disappointing few of these brave new ideas have made it into practice. These classroom innovations often remain effectively a secret – unknown to most STEM educators or the research community at large.

It turns out that on the whole educators are great innovators but have had a hard time translating their ideas into widespread adoption. What we had was a very slow classroom innovation diffusion rate.  Was there any was to speed this up?

A year ago Don Millard of the National Science Foundation (who in a previous life had been a STEM Educator) approached me with a hypothesis that possibly could solve this problem. Don observed that educators with innovative ideas who actively got out of their classrooms and tested their innovations with other educators/institutions/students had a much better adoption rate.

Up until now there was no formal way to replicate the skills of the educators who successfully evangelized their new concepts. Don’s insight was that the I-Corps model being rolled out for scientists might work equally well for educators/teachers. He pointed out that there was a close analogy between scientists trying to bring product discoveries to market and educators getting learning innovations into broad practice. Don thought that a formal Lean LaunchPad/I-Corps methodology might be exactly what educators needed to understand how their classroom innovations could be used, how to get other educators and institutions to adopt them, and how to articulate their value to potential investors .

Don then recruited Karl Smith from the University of Minnesota to pilot a class of 9 teams made up of STEM educators. Karl recruited a teaching team (Ann McKenna, Chris Swan, Russ Korte, Shawn Jordan, Micah Lande and Bob MacNeal) and Jerry Engel trained them. The team ran their first I-Corps for Learning class earlier this year.

Karl and his teaching team really nailed it. So much so that the NSF is now rolling out I-Corps for Learning on a larger scale.

I-Corps for Learning Details
NSF will provide up to $1.2 million to support 24 teams. The I-Corps L cohort teams will receive additional support — in the form of mentoring and funding — to accelerate innovation in learning that can be successfully scaled, in a sustainable manner.

To be eligible to pursue funding, applicants must have received a prior award from NSF (in a STEM education field relevant to the proposed innovation) that is currently active or that has been active within five years from the date of the proposal submission. Consideration will be given to projects that address K-12, undergraduate, graduate, and postdoctoral research, as well as learning in informal science education environments.

Each team will consist of:

  • The principal investigator (who received the prior award);
  • An entrepreneurial lead (who is committed to investigate the landscape surrounding the innovation); and
  • A mentor (who understands the evidence concerning promise, e.g., from an institutional education-focused center or commercial background that will help inform the efforts)

The outcomes of the pilot projects are expected to be threefold:

  • A clear go/no go decision concerning the viability and effectiveness of the learning-oriented resources/products, practices and services,
  • An implementation “product” and process for potential partners/adopters, and
  • A transition plan to move the effort forward and bring the innovation to scale

Proposals from potential I-Corps L teams will be accepted through September 30, 2014. Class starts January 2015.

Check out the I-Corps for Learning website here.

Lessons Learned

  • The diffusion of STEM classroom innovations is excruciatingly slow
  • The Lean LaunchPad/I-Corps model may accelerate that process
  • I-Corps for Learning is accepting applications

Validation: Be Sure Your Startup Vision Isn’t a Hallucination. 2 Minutes to See Why

If you can’t see the video click here

Customer Discovery: The Search for Product/Market Fit. 2 Minutes to See Why

If you can’t see the video click here

I-Corps @ NIH – Pivoting the Curriculum

We’ve pivoted our Lean LaunchPad / I-Corps curriculum. We’re changing the order in which we teach the business model canvas and customer development to better-fit therapeutics, diagnostics and medical devices.Udacity canvas and value prop

Over the last three years the Lean LaunchPad class has started to replace the last century’s “how to write a business plan” classes as the foundation for entrepreneurial education. The Lean LaunchPad class uses the three “Lean Startup” principles:

  • Alexander Osterwalders “business model canvas” to frame hypotheses
  • “Customer Development” to test the hypotheses outside the building and
  • “Agile Engineering” to have teams prototype, test, and iterate their idea while discovering if they have a profitable business model.

Teams talk to 10-15 customers a week and make a minimum of 100 customer visits. The Lean LaunchPad is now being taught in over 100 universities. Three years ago the class was adopted by the National Science Foundation and has become their standard for commercializing science. Today the National Institutes of Health announced their I-Corps @ NIH program.

The one constant in all versions of the Lean LaunchPad / I-Corps class has been the order in which we teach the business model canvas.

Value Propositions and Customer Segments are covered in weeks 1 and 2, emphasizing the search for problem/solution and then product/market fit. Next we teach Distribution Channels (how are you going to sell the product) and Customer Relationships (how do you Get/Keep/Grow customers) and Revenue Streams (what’s the Revenue Model strategy and pricing tactics.) Finally we move to the left side of the canvas to teach the supporting elements of Resources, Partners, Activities and Costs.

current teaching order

Teaching the class lectures in this order worked great, it helped the teams understand that the right-side of the canvas was where the action was. The left- hand side had the supporting elements of the business that you needed to test and validate, but only after you made sure the hypotheses on the right were correct.

This lecture order was embedded in the Udacity Lectures, the syllabi and educators guide I open-sourced. Hundreds of teams in the NSF, and my Stanford, Berkeley, Columbia, and UCSF classes learned to search for a repeatable and scalable business model in this way.

It’s consistency was the reason that the NSF was able to scale the I-Corps from 15 to 30 University sites.

So why change something that worked so well?

Last fall at UCSF we taught 125 researchers and clinicians in therapeutics, diagnostics, medical devices and digital health in a Lean LaunchPad for Life Sciences class. While the teaching team made heroic efforts to adapt their lectures to our “standard” canvas teaching order, it was clear that for therapeutics, diagnostics and medical devices the order was wrong. Hypotheses about Intellectual Property, Reimbursement, Regulation and Clinical Trials found on the left side of canvas are as, or more important than those on the right side of the canvas.

I realized we were trying to conform to a lecture order optimized for web, mobile, hardware. We needed to cover Intellectual Property, Reimbursement, Regulation and Clinical Trials a month earlier in the class than in the current format.

The National Institutes of Health has adopted our class for its I-Corps @ NIH program starting this October. Most teams will be in therapeutics, diagnostics and medical devices. Therefore we’re going to teach the class in the following order:

1) value proposition, 2) customer segments, 3) activities, 4) resources, 5) partners, 6) channel, 7) customer relationships, 8) revenue/costs

LS Suggested Order simple

I-Corps @ NIH Lecture Order Details
Customer Segments change over time.  CROs or Payers may ultimately be a resource, a partner or a revenue source, but until you get them signed up they’re first a customer. Your potential exit partners are also a customer. And most importantly, who reimburses you is a customer. (You get an introduction to reimbursement early here, while the details are described later in the “Revenue” lecture.)

Activities are the key things you need to do to make the rest of the business model (value proposition, distribution channel, revenue) work. Activities cover clinical trials, FDA approvals, Freedom to Operate (IP, Licenses) software development, drug or device design, etc.

Activities are not the product/service described in the value prop, they are the unique expertise that the company needs to deliver the value proposition.  In this week we generally describe the business rationale of why you need these. The specifics of who they are and how to work with them are covered in the “Resource” and “Partners” lectures.

Resources - Once you establish what activities you need to do, the next question is, “how do these activities get accomplished?” I.e. what resources do I need to make the activities happen. The answer is what goes in the Resources box (and if necessary, the Partners box.) Resources may be CRO’s, CPT consultants, IP, Financial or Human resources (regardless of whether they’re consultants or employees.)

Partners are external resources necessary to execute the Activities. You’ve identified the “class of partner” in the Resources box. This lecture talks about specifics – who are they, what deals work with them, how to get them, how to work with them.

Customer Relationships is what we think of as traditional sales and marketing; assembling a SAB, getting the KOL’s, conferences, articles, etc.  Customer Relationships answers the question, “How will we create demand and drive it to our channel?”

Suggested Order

We think we now have a syllabus that will better fit a Life Science audience. Once the syllabus stops moving around we’ll open source it along with the educators guide this fall.

Lessons Learned

  • The Lean LaunchPad class has started to replace the last century’s “how to write a business plan” classes
  • The lecture order emphasizes testing the right-side of the canvas first
  • That works for almost all markets
  • However, for life sciences hypotheses about Intellectual Property, Reimbursement, Regulation and Clinical Trials are critical to test early
  • Therefore we created a more effective lecture order for Life Sciences

Keep Calm and Test the Hypothesis. 2 Minutes to See Why

NIH I Corps logo

Pivot – Firing the Plan Not the People. 2 Minutes to See Why.

If you can’t see the video click here


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