In this episode of "20 minutes VC," Harry Stebbings interviews Trey Vasalo, co-founder and managing director at Defy VC, a Silicon Valley Series A fund. Trey shares her journey from growing up in rural Minnesota to co-founding Good Technology and becoming a general partner at Kleiner Perkins. She discusses her affinity for hardware investments, like Owl Cam, and her approach to learning new skills, such as gymnastics. Trey also touches on the importance of operational excellence in venture firms, the challenges of establishing a new fund, and her commitment to promoting diversity in tech, as highlighted in her co-authored study "Elephant in the Valley." She emphasizes the significance of team dynamics in startups and how venture capital doesn't scale well with firm size, leading to her decision to start Defy VC.
"I'm very proud to welcome Trey Vasallo, co-founder and managing director at Defy VC, one of Silicon Valley's newest and most exciting series A funds with the announcement of their debut $151,000,000 fund in September 2017, and prior to cofounding Defy, Trey was a general partner at Kleiner Perkins, where she invested in a number of leading companies, including Ero, Nest, Dropcam, Aggregate knowledge and opower."
This quote introduces Trey Vasallo and her professional background, highlighting her significant roles in venture capital and entrepreneurship.
"So I grew up in the middle of nowhere. It was literally a farming town on the Iowa border in Minnesota. [...] I remember, gosh, when I was probably in grade school, being incredibly inspired by these apple twos we had at school, and it just clicked."
This quote gives insight into Trey's upbringing and the early inspiration that led her to pursue a career in technology and engineering.
"Well, so the first thing I realized was that I really did love engineering, but not just computer science. [...] And then really it was robotics. So I ended up going straight through getting my master's degree and taking, and then tang this incredible class on robotics. And, of course, that's the class where I met Steve, of course, on the oscilloscope. Bench."
This quote describes Trey's academic journey, her broad interest in different engineering fields, and how it led to meeting her husband and her first steps in the tech industry.
"Well, and this is back, we founded good in March of 2000. So this is right before the crash. And John was on the board of Amazon and he had just done Google at this time and just this incredible"
This quote reflects on the significance of having a prominent figure like John Doerr as a mentor and board member during the early stages of Good Technology.## Working with John Doerr
So the thing that was so incredible about working with John is that he was really good at quickly identifying the big question, the big issue. He never got distracted by the small minutiae that so many folks can get distracted by. He was always laser focused on what's it going to take to turn this into a great big opportunity.
This quote highlights John Doerr's effectiveness in recognizing and concentrating on the critical aspects that would turn an opportunity into a significant success, emphasizing his strategic focus and ability to avoid distractions.
So I got to shadow John in some board meetings. I got to shadow Vinode. There were other incredible partners like Kevin Compton, who I worked really closely with.
Trey Vasallo describes her experience shadowing various partners at Kleiner, which contributed to her understanding of different investment styles and approaches to entrepreneurship, shaping her professional development in venture capital.
And so one of the things that I found is I was connecting with the entrepreneur and the teams in different ways than my partners were.
This quote reflects Vasallo's realization that her engineering and entrepreneurial experience allowed her to connect with and support entrepreneurs in ways that were distinct from her colleagues, highlighting the value of diverse backgrounds in venture capital.
And so it was through that following the path of the entrepreneur where I realized, wow, so there's a lot of money in this industry, but it's sort of pooled in very specific parts of the ecosystem.
Vasallo's exploration post-Kleiner highlighted the uneven distribution of venture capital, particularly for early-stage entrepreneurs needing moderate funding, which inspired her to start Defy to address this market need.
No, I don't actually agree with that. And I think it also depends on what you define as traction.
Trey Vasallo challenges the generalization about Series A funding requirements, suggesting that investment criteria can vary significantly based on the type of company and the industry, emphasizing a more nuanced approach to venture capital.
My tact is the most important initial piece is the team.
This quote underscores Vasallo's investment philosophy, where the team's capabilities and potential are the primary criteria for investment, particularly in the hardware sector where she has personal expertise and interest.## Early Involvement in Company Formation
"And so this is one where I was there right at the beginning. Both of my partner Neil and I were meeting with him and pushing him on areas that we thought would make for a really interesting company."
The quote highlights the proactive role Trey and her partner Neil took in shaping the initial concept of a company by providing guidance and input to the founder.
"But LPs absolutely wanted to see how we process deals and how we work together as a team."
This quote emphasizes the importance of showcasing the team's deal-making process and collaboration to LPs during fundraising efforts for their new fund.
"And once you have some high-quality venture LPs on board, they then tell their friends, and that builds momentum and snowballs."
The quote underscores the significance of securing initial high-quality LPs, whose endorsements can create a snowball effect in attracting additional investors.
"I thoroughly loved meeting the LPs and the incredible institutions that they're working on behalf of."
This quote reflects Trey's positive experience with fundraising, which contradicted her expectations based on others' horror stories.
"So Neil and I didn't have this story of, yeah, we've worked together for the last ten years, but at different firms, we really hadn't crossed paths."
The quote addresses the concern of LPs regarding the newness of Trey and Neil's partnership and their lack of a shared working history.
"So we very quickly said we want to build our firm on the premise of operational excellence."
This quote highlights the strategic decision to focus on internal operational excellence as a foundational principle for the firm.
"So our fund is $151,000,000. And so we absolutely make sense to bring that person on our team and invest the money into building out a platform for the future."
The quote provides insight into the decision-making process regarding when it is appropriate for a fund to hire internal staff versus outsourcing based on the size of the fund.
"But there was an entrepreneur who had been an incredible, is an incredible reference for us... he wanted to put a million bucks into our firm and be the 151 of what we were building."
This quote explains the personal and emotional significance behind the fund's size, highlighting the firm's commitment to its entrepreneurs and community.### Favorite Book and Its Impact
"I just finished reading Brotopia by Emily Chang and I think she brings such a great lens to what is happening, why talking about it is important and how we can make change going forward."
The quote explains Trey's recent engagement with "Brotopia" and her endorsement of its critical examination of gender dynamics within the tech industry, as well as its advocacy for change.
"I do think there are a number of pretty simple things like that that with a little bit of effort can make a big difference."
This quote summarizes Trey's view on how relatively straightforward measures, if undertaken sincerely, can have a substantial impact on enhancing diversity within the workplace.
"I'm super proud of our lp base, but one of our lps is a personal hero of mine."
The quote reflects Trey's pride and admiration for her LP base, particularly highlighting the influence of a specific LP who she holds in high regard.
"We tend to just not talk about work at home because it is a bit of a challenge."
This quote reveals Trey's approach to maintaining a healthy work-life balance by keeping professional competition and discussions separate from home life.
"You're putting yourself out there. It's scary. You're failing, you're iterating, and then hopefully, you break through."
The quote draws a parallel between the learning process in sports and entrepreneurship, highlighting the resilience and adaptability required in both pursuits.
"So right now, it's gymnastics, believe it or not."
This quote indicates Trey's latest personal challenge and her commitment to continuous learning and self-improvement.
"The owl cam is a product that you put in your car. It's like a dash cam, but does a whole lot more."
This quote describes the unique value proposition of Owlcam and its potential to innovate the car security market through advanced video features.
"And if you'd like to see more from Trey, which you must, then that's on Twitter at Trey, T-R-A-E."
The quote is an acknowledgment of Trey's contribution to the show and an invitation for the audience to engage with her work and social media presence.