I’m Rachel ten Brink, a Latina Y Combinator Founder turned VC. I spent 15 yrs building billion dollar brands, scaled my Y Combinator ecommerce startup, Scentbird, and now launched Red Bike Capital to invest in early stage startups in Fintech, SAAS and Health & Wellness.
The other day I spoke at a dinner and someone introduced me as having successfully “pivoted” throughout my career. I stopped to think about it – I have never thought about it as “pivoting” but rather “layering”.
In my view, my career is a layered cake – where every life experience (Latina, immigrant, daughter of immigrants, mother, wife, New Yorker), every professional experience (corporate exec, operator, Y Combinator founder, investor), every piece of who I am and my perspective (woman, outsider, insider), becomes a cumulative journey that takes me to the next level.
Being different IS my competitive advantage. It enables me to sit in rooms others don’t and see opportunities others miss. I appreciate that I am part of a tiny minority – one of 90 Latinas that have ever raised over $1M, part of the 0.1% Latina GPs in Venture. But, I strive to be an example, not an exception.
Many have asked me what I have learned as a founder turned VC. There are so many lessons that can be gained from “switching sides” of the table and seeing how the other side sees things. So, here are 3 lessons I would like to share:
1. The hardest part of being a VC is that you say no 99% of the time. Understand that VC starts off as a volume business, and most startups will not be a fit. Having been on the other side, I truly understand how hard it is, but you should never take it personally, just keep on going until you find your tribe.
I also see how extremely hard it is for women and for minorities. After all, our tribes are significantly smaller given the numbers on the other side of the table (98% of dollars go to white males) – but keep on going. Focus on data, focus on performance but accept that VCs don’t always get it right. We might have a very specific, narrow view of certain sectors, spaces, players.
Similarly, don’t lean on VCs for knowledge they may not have. Be very selective about whose advice you take – most have only seen startups from the VC side of the table.
2. From the outside, VC may look sexy. It’s not – don’t believe the hype. Emerging managers are also startup founders trying to secure funding and manage operations with a tiny team, while VCs that work in larger funds have a lot of politics to navigate. Ask a lot of questions – particularly today with the challenging fundraising environment funds and founders are facing. But don’t be too negative either. I didn’t move to VC because of ego (though it is fun sometimes!). I love early-stage startups and working with founders who are changing the world. That’s magic. VC is my vehicle of choice to get a job done.
In this market more than ever, make sure you are working with funds that will not just markup their investment, but bring the right operators, the right insight, and the right level of support for where your business is.
3. Understand that for VCs it’s as much gambling and luck as it is systems and hard work. We live by the fact that most deals will fail. As a VC, I only need 1 in 10 to work. In a startup, it’s the opposite paradigm. VCs have investors, and they expect outcomes and returns. Know that they’re here to make money – as someone told me – effort gets rewarded in heaven, and results get rewarded on earth.
Use this knowledge to your advantage – appeal to their greed and be sure to clearly explain how you make (a lot of) money. Particularly as women, we need to embrace that women deserve the privilege of taking big bets and (sometimes) making mistakes.
I would end by saying that I appreciate you and see the incredibly hard path you’re following- whether as a female founder or VC. We need communities like Elpha to share knowledge and continue to empower each other. I hope this helps your journey.