Association Series #2: Phoebe Harrop, Partner @ Blackbird
Uncovering how interesting minds entered Venture Capital and new aspects of their personality, experiences and processes to light.
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#2 Phoebe Harrop, Partner @ Blackbird
1/6 Career overview before Blackbird
I’m from small-town New Zealand where the heights of success are becoming a doctor, lawyer, teacher or accountant.
So naturally, I trained as a lawyer (and also studied Spanish) at University. I did one Economics paper, which ended up being the worst mark in my whole degree, but had no real quantitative training and honestly, not that much interest in business.
I got to the end of my degree and was staring down a future in corporate law. And I started to think about how positive change and innovation happens in the economy. I realised that actually businesses and private enterprise - not government, and definitely not lawyers - are responsible for a lot of progress in areas that matter, like climate, education, healthcare etc. That led me to join Bain, the consulting firm, to get a kind of general business education - learn how organisations tick, how to work with people from all kinds of roles and industries, and how to problem-solve quantitatively.
Through my time at Bain in Melbourne, then London, I got exposed to the investment and private equity world which led me to be interested in becoming an investor. But to be honest, I didn’t want to work with typical private-equity-owned businesses - I was way more drawn to founder-led tech companies. That’s when I left Bain and joined Generation, Al Gore’s $1 billion growth equity fund, to invest globally in Series C+ technology startups.
At this point in moving to Generation, I had practice in tearing down business models, quickly getting up to speed on an industry, getting under the skin of a particular company, and doing a lot of the investment job… a lot of “dating” companies on paper. But I hadn’t done the actual job of making an investment decision and working with founders for many years - which is more like getting married.
At Generation I got to work with some epic founders like Dustin and Justin from Asana, Matt from Remitly, Jesse from M-KOPA and many more. I loved the work, but late-stage venture capital can feel a bit academic in a way, a bit removed from the real ups and downs of the early founder journey.
2/6 What was the interview process to join Blackbird?
While at Generation In London, I came across Blackbird and some of the other Australian based funds through their portfolio companies like Culture Amp, Skedulo and SafetyCulture.
This got me interested in what was happening in the Australian startup scene. I first applied for a job at Startmate, and was a Coach in their Women's Fellowship while I was still in London, as a way to sort of dip my toe back into the startup scene Down Under. And that was really amazing - it was clear so much was happening. What a vibe.
Then in September 2020 I applied for the Principal role at Blackbird in the Australian investments team. That was the first time Blackbird had hired for hire into the investment team from the outside. The process from memory was:
A blind-reviewed, written application through Applied (four short-form questions)
Two interviews with the partners, one with Nick Crocker and one with Sam Wong (20 people made it through to this stage)
Case study: a thesis on a company I loved (four people made this stage)
I made it to the final four, but missed out on getting hired through this process. What I had was investment experience, but in later-stage companies - not the pre-seed startups that is Blackbird’s bread and butter. I also hadn’t worked in a startup or been a founder.
I was gutted! I was head over heels in love with Blackbird. So I kept in touch with the team. When I returned to New Zealand on holiday at the end of 2020 I met up several times with Sam, and managed to land an Associate role in the NZ fund, starting in March 2021. I was made a Principal in September 2021 and a Partner last month (February 2023). It really couldn’t have worked out better - building Blackbird Aotearoa is my life’s work.
3/6 Looking back on the past 12 months of being an investor, what two skills have you had to accelerate the most?
The thing with VC is once you start doing it, you are really practising and refining a craft over and over again for — hopefully 20+ years. Along the way it’s about constantly improving your algorithm for how you spend your time and money. I haven’t had to focus on one or two things in particular over the last twelve months, but I think I’ve gotten better at knowing where to spend time.
A huge part of that has been continually refining my taste around what an outstanding founder and product looks like at the early-stages. One of the accelerants here is learning from the different styles around the investment team at Blackbird. Watching what questions others in the team ask of founders, what aspects they weigh most heavily in coming to a decision, and - over time - seeing how those founders’ stories unfold. I’m in the lucky position of getting to learn from, and take the best bits, from all of their styles.
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4/6 Three specific things you do directly after meeting a founder for the first time?
As I go during the meeting, I’m writing down my thoughts on the company — what are the things that really matter for the business model and product, and the things that are real question marks that I'd want to dig into. It's a loves and doubts kind of framing. Before saying yes to spending more time, or before passing, I usually sleep on it.
If it’s love at first sight, I’ll think about — how can I help this founder immediately, are there some things that came up where I can introduce them to someone who would be useful for where they’re at, or send them something on a problem they’re facing that might be useful for them to read or listen to?
At Blackbird we’re all generalist investors. I know a little bit about a lot of things. I don't know a lot about anything. So when diving in to understand a company I often need to get back up to speed on a technology or industry. I do that through talking to people who live and breathe that area, I listen to podcasts from later-stage founders operating in the same space.. Anything to jog my mental model for what I should be thinking about with that particular kind of company.
Often the challenge down the track if you really love a company is to explain that love to the rest of the team. Make them feel the love without them getting to meet the founder directly.
And so what you need to put in an investment writeup is stuff that really brings out the magic of why this person — (it's often about the people) — has the right grit and hustle and connection to the problem. And usually that's something you feel, before you can articulate why.
What I try to do now is capture little bits of quotes or the sense that I'm getting during the meeting, so that I have that evidence to go back to later.
We also usually record the founders pitch in the second meeting. And then, we make a supercut of it using Dovetail to pull out the key moments so that someone else in the investment team who didn't join that meeting can get a sense of the magic.
5/6 What is your top tip for getting into VC?
Do the core job which is to, figure out your own tastes and people in companies, then spend your resources (time or money) and help those that you think are most worthy.
If you have money to invest, the quickest way to learn is by making the hard decisions of actually investing small amounts into early-stage companies. That means, meeting founders, figuring out your taste for them and how the very best 1% of founders are. No matter whether you do it yourself or not professionally, you're always going to be investing in a tiny minority of people that you meet.
If you're not in a position to make investments, then you can invest your time. Try and magnetise a bunch of people to you in different ways by being helpful — for example, creating something that the ecosystem needs.
You’re the perfect example of this Vidit — with your podcast, The High Flyers and everything around it — that's your way of magnetising people, and that can turn into deal flow.
The most important thing is getting heaps of repetitions by meeting heaps of founders, then doing your own decision-making and reflecting to tune that algorithm.
6/6 What separates the best investors from the rest?
The best investors combine high IQ and high EQ which is not always an easy combo to find.
The reason that those are both important is this is a people job first and foremost, you have to be someone that founders want to work with. And someone who can build a strong network of a community that will help your founders, and also help you by referring you new founders. You have to be someone people want to spend time with.
Everyone does this in different ways. For example, Niki doesn't go to events. The way that he builds those referral networks and really strong relationships is one to one and he's just an incredible person to engage in a conversation with. Others do it by being out there and getting to know everyone in the space.
On the IQ side — You do have to bring a critical eye to what business models can turn into really attractive companies at scale that will provide a return path for you as an investor or for your fund. You have to be really a little bit nerdy about engaging with those and bringing quantitative information to bear on those decisions in an efficient way
You have to be interested to understand how financial aspects like unit economics work in so far as it can help you make better decisions about: does this company have the right bones or not?
And I think the other thing that distinguishes the best investors is being interested in how decisions get made, and constantly reflecting on whether you’re making decisions well. You don't get feedback very quickly on whether you’re a good investor. You have to be very reflective and open to feedback, and constantly wanting to get better in other ways. Someone who's quite self aware, I think, does well as an investor.
Thanks for reading this second instalment in the Association Series! Get in touch with me anytime here — to share your thoughts, suggest other questions and/or people we should feature.
Fly high,
Vidit