Climb By VSC: Episode 2

Jay Kapoor: In climate tech, today, I'm thrilled to be joined by Katelin Holloway who is an investor and partner of the venture capital firm 776. As an investor, Katelin has been vocal and passionate about backing companies that shape the future of work, like sustainability and the delicate balance and enables us to thrive and love that.

Katelin Holloway: Jay, thanks so much for having me on the show today. I'm a big fan of your work and I'm really excited to chat.

JK: Well, let's let's kick things off then. So you've had quite an interesting journey into the world of startups and venture. Some might not know that you actually started your career at Pixar Animation before some time at Reddit. So tell us a bit about that journey and what brought you to becoming a founding partner of the venture capital firm 776

KH: Absolutely. I will try to give you the short version because it is definitely a long and winding path. And to say that I started my career at Pixar is a lovely sentiment. I did many things before that. I've reinvented myself like 20 times over. So if you had asked 18-year-old me, “Do you want to be a venture capitalist?” I would have never predicted that this would be the outcome. I mean, shoot 35-year-old me was pretty lost too to be honest. But I am very, very grateful for the wide range of experiences and in the different industries that I've worked in that kind of led me to here.

My first job out of school, I was an elementary school teacher. I've worked in hedge funds. I've worked in advertising. It's a pretty wide range of things. But Pixar was really the first job that I made a conscious decision to take. I call it my quarter life crisis, where I was working in advertising at the time, and that was the first job that I had had that I hated. And that was an interesting and very uncomfortable feeling for me. I had been very lucky up until that point

But I decided to make an intentional change. When I looked for a company back then in my early years, the idea of company culture wasn't around. Culture was talked about, you know, in the national geographic context

Certainly not in the workplace. But I knew that what I was looking for was an environment at a company where I could really discover myself, I consider myself a Jane of all trades master of none. I was curious and interested in a lot of things but was really lacking direction. And I was convinced that the job that was meant for me, I didn't even know existed yet. And so I was looking for a company where I felt that I could find and Pixar was that it was exactly that. I feel so fortunate. But it found me at exactly the right time as I was searching for something and so I look at my career and all of the different kinds of milestones that that were pivotal or those you know, fork in the road moments.

Is there something I can do to help make it better? And so like I said, Pixar was one of those I'm curious decisions that I made. And I was so lucky to join that team just before the Disney acquisition. And it not only was a critical milestone for Pixar, you know, those folks in the studio but it was for me very personally as well.

So I spent five years there, tooling about trying to figure out what I wanted to do when I grew up. I worked in almost every part of the studio.

And it was a phenomenal, phenomenal experience. But, you know, five years later, I decided that I wanted to go and take those learnings and I joined the world of tech.

JK: You have very clear areas of interest. And you know whether it's you or your partner, Alexis, crypto culture, climate, knowing what you're about. So, tell me what excited you about those categories and about becoming an investor in those categories. And maybe even why those three categories.

KH: Yeah, so it's fun to figure it out as a relatively new investor. So, I, as you mentioned, I was an operator for well over a decade as an HR executive in the land of tech as an early builder in web two, being a very, very early employee, if not the first employee, and then helping companies grow and scale. And as I decided to transition into venture capital, one of those driving curiosity moments for me was really around the wealth gap and understanding how I can have a better impact on the outcomes there. And so, I think as you're well aware, the work that you do, venture is absolutely at the start of a major meaning What we're building at 776 is absolutely aiming to accelerate this shift.

JK: Yeah, look, I think it's important as an investor to have a theme, and I think our thesis even if you are, you know, sector agnostic, like 776’s and generally I think VSC ventures as well. Are there certain companies in a climate that you're drawn to or even certain themes and climate that you're drawn to where you say, I think this is really moving the needle versus maybe this is just slightly incremental?

KH: Yeah, you know, I, I will start by saying I am by no means a climate expert. I am certainly early in my learning journey around the science and the opportunity and the technology and one thing I love so much about sitting in this role as investor is that I get to see and learn from so many incredible builders, right? But the solutions to solving the climate crisis seem to be a saturated market.

And then you see what's happening on an enterprise scale, what's happening on a global governmental scale and the lack of action sometimes that's happening in companies and governments.

JK: Where do you think that factors in as an investor like when you're looking at these things, does that impact? How big of an opportunity or how big of an idea do you want to go after?

KH: I think for me, it has to be everyone has to be all in on this. So changing our habits and behaviors at home are important. We also have challenges, forest fires and just massive climate impact from more aggressive impacts of climate change.

JK: Talk to me about Droneseed. See what excited you about that company? What do they do for those of our listeners that aren't aware of them? I would love to understand a little bit more about them.

KH: I love talking about Dronseed because this was my first climate investment.And it came at exactly the right time. Drone seed is solving rapid reforestation through the use of technology, specifically drones. Living in California, forest fires are just absolutely ravaging our planet and having been introduced to drone seed in the middle of the pandemic, sitting at home with my two babies and not being able to go outside, you know, looking out our windows and seeing what felt very, very apocalyptic with a deep red sky because of all the forest fires across our state.

It was a no brainer to make this investment. You know, the work of replanting seeds manually I had no idea to reforest it was a human one. One seed at a time Johnny Appleseed style. And so you know, I joined the board of that, that company through that investment, and we have just continued to double down on them.

JK: Yeah, absolutely. I knew we were gonna touch on a little bit of your experience on the board there. So comparing and contrasting, working with companies outside of climate tech versus working with ones inside of it, whether it's in regards to people and culture, which is you know, the world that you know, and came from, but even more broadly, what do you find is sort of unique that a company like Droneseed, or even more broadly, companies in climate tech have?

KH: It's such a good question. One thing that I have had the privilege of learning through these investments is understanding. Just simply different backgrounds of people. So, you know, recruiting and Blitzscaling in tech and having double your team size and 50% engineers, I've done that for over a decade and I understand the challenges. But how do you recruit seed collectors, for example?

How do you engage people who live off the grid? How do you find the people who have dedicated their lives to helping to solve and educate people about climate crisis? You know from your cabin, up in the woods? Is it reaching out to candidates? Simply recruiting is a very, very, very different process.

Again, going back to my curiosity and wanting to help solve the wealth gap, that has been a joy and is very different. And then, I think, three is, you know, recruiting. I don't want to focus on recruiting, but I think that there's something very special about recruiting people who are very passionate about solving the climate crisis.

JK: What are the kind of things that founders and executives should be doing early on to make sure that they're building a culture where there isn't this clash between climate and tech? You know what I mean?

KH: Absolutely. I love that you're asking these questions that makes me so happy. The first step to creating any healthy culture is to set up the systems and frameworks to listen. It is the first thing I do when joining any company. I set up those systems and frameworks to listen and understand what is motivating your employees, and then do something about it.

Yeah, I think between taking the time to educate your employees on equity packages, which they may not be familiar with, and then I think taking the time to look ahead and say let's put in place practices today.

I think it's widely applicable to a lot of companies. I mean, how you tend to find this satisfaction with employees comes from the expectation gap, right? You think it's going to be a great experience, and then it's not, but I liked that you called out the importance of spending that time to do it early.

JK: What are maybe common pitfalls or mistakes that you see some of the companies that you work with, you know, on the climate front that you wish more people knew about your like, I wish more people understood that they need to be doing this sooner.

KH: I think that like I said, the very smartest founders in the pitch are actually asking us and grilling us on who our LPs are. And so to me, that shows a very keen awareness and understanding of what is going to motivate them. Because if your employees figure out that you're doing their hard work, is actually going to to line the pockets of people who are working against their mission. You will lose them, you will lose them. And they and that community talks that will spread like , no pun intended, wildfire. I would highly encourage anyone building in climate tech and honestly in any sector, ask where your money is going ask where they're investing dollars go at the end of the day, because it really does matter.

JK: Yeah. I love that you said that. I mean, one of the things that I particularly love about working in climate tech, it is one of the verticals that we really focus on, is that there isn't this somewhat a false archetype of what a climate tech founder looks like, right?

KH: I agree. It's it's different and I love that it's breaking the mold in so many different ways. For great climate founders, I think that it has to start with deeply understanding the part of the problem that they want to solve, and being experts in that area. Which I would say for any founder in any industry, I want to know why they're going to build this for the next 10 years with their whole heart.

And you know, I think that I will say this is something I look for, but just something that I have noticed with some of my own biases is that the US is so far behind the rest of the world when it comes to addressing climate and addressing climate from the private sector. And so for me, I've had the opportunity to meet founders from all over the world. And some of our very first international investments have been in climate tech companies because we want to meet the best founders exactly where they are.

JK: How do you factor in the government risks of it all? You know, so many of the companies that we see are selling into expensive penalties. Maybe it's states, maybe it's federal agencies. Historically, this is a category that venture investors have profits they are in the hell away from because of the long sales cycles because you know, administration changes and boom, a deal you've been working on for a while can go kaput. How do you factor into your decision-making when you're looking at companies that you want it back?

KH: I am so glad you asked this question. This is this is one of the reasons I got into venture was to break some of those, you know, pre existing models that I think are very outdated, because the reality is that well, there are several realities that I want to wet. I will try to keep it more sustained. Truly, you know, investors are supposed to be looking at the long term, right? What does this look like 10 years down the road? 20 years down the road. The reality is, is nothing else matters if we do not solve climate as quickly as possible. And so yeah, get in there. Yes, it's going to take longer and yes, those that you know, you could get the rug pulled out from under you. But you know, our job not only as investors, but as fellow citizens on this beautiful blue globe is that we must, we must do everything we can to accelerate this change, not to climate change, but accelerate the change, where we start caring and our policies are shifting quickly, urgently and appropriately.

JK: So I want to talk a little bit about the 776 Foundation and the program that you launched, which was the climate fellowship. For those of our listeners that don't know, please tell us about the focus and mission of this initiative.

KH: Absolutely. I'm happy to share. So when we started 7767 at the venture capital firm, that was two years ago, as of September 1, and you know, we there were three of us that started it. It was Alexis Ohanian myself and Elizabeth Garvin (Lizzie).

Alexis and his family decided that they wanted to set up a foundation and this was something that I, you know, had always been on our roadmap as we were iterating on what 776 could potentially be over time, you know, beyond just a venture capital firm. And Lizzie This is the work that she lives for. And so, we knew that she was going to go ahead and leave that for us. So the foundation is we just started it just in the last year, not even here less than a year.

It starts with a $20 million commitment from Alexis that we will commit over the next decade. And the first cohort of Fellows is addressing the climate crisis. And so we we want to support the problem solvers at the earliest earliest possible stage and so our fellowship program gives 20 remarkable young people, they have to be under the age of 23, the chance to spend two years working on the idea that that keeps them up at night, and so we will give grants of $100,000 per fellow and work very closely with them to build programs and build that support that they need to bring their incredible and brilliant ideas to life and so that's all being led by Lizzie.

JK: I love that that is awesome. It reminds me of you know, I got my start in venture and TechStars and the energy when you have programs like that, where there are just creative collisions and people bouncing ideas off of each other to channel that energy in the climate is fantastic. Maybe what we'll close there. You know, when you think about young people today that are interested in tech that are passionate about climate, you know, what is some advice that you would have for them about building a company in this space or even potentially joining a company in this space?

KH: I love it. “The Kids Are All Right” right? Like I know that I am getting older when I get just absolutely tickled at the thought of how many young people care so deeply about this. And so, I have so much advice, and I think that the most succinct response would be “do it.” Please do it. There. I feel like my generation has failed. And so now it's our responsibility to help support young people, people of all ages but particularly young people.

JK: I really, really appreciate that. Katelin, I think my two biggest takeaways from our conversation today are; one know, the consumer action that we feel like it's so incremental is actually really important because it speaks to a broader set shift that we all need and we're going to really tackle this thing. And the second being that we can't be afraid of the big problems. along sales cycles with governments, you know, contracts like all of these things are essential if we're going to have a planet to live in 40 years for these young entrepreneurs that I think are much more acutely realizing this than maybe generations before us have so I appreciate you sharing your perspectives. Thank you so much for your time and I am thrilled to partner with you on things moving forward.

KH: So thank you so much for having me.