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#AIS: Pear VC’s Mar Hershenson on making successful founders


Chapters

0:0 Pear VC Founding Managing Partner Mar Hershenson gives a talk on making successful entrepreneurs: can great founders be created, or is it something they are born with?
17:4 Bestie Q&A with Mar: Catalyzing great founders, why the PayPal Mafia created more unicorns than early Google employees, creating more opportunity for underrepresented founders, inducing failure & more

Transcript

Next up is Mara Hershenson, who's going to talk about entrepreneurship. Come on out, Mara. Mara is going to talk about creating successful founders. Please welcome Mara. Thank you. Well, I have a pretty positive and optimistic talk. I know the mood may be a little bearish in general. So my name is Mara.

I'm one of the founders of Pair VC. And I am very fortunate. I actually work with many startups. I've worked for the last decade with 100 plus startups. They're worth over $100 billion. And they all have one thing in common. When I invest, there's actually nothing. I'm the first check.

There is no product. There's no customers. There's just the founders. So it is no surprise. That I often wonder, are these founders born? Are my cards dealt as soon as I invest in one of these founders? Or is there anything I can do to change them? That's a big question.

And I think many of you would say founders are born. Take, for example, Palmer Luckey. He's talking tomorrow. He was a prodigy. He created the first prototype of the Oculus Rift at 17. And he sold the company. And he sold the company. And he sold the company to Facebook at 22.

Clearly, there's something special about him. Or Melanie Perkins. She started her first business at 14. Then at 19, went on to build the largest yearbook business in Australia. And now she runs one of the most successful startups. And then Elon Musk. I don't think I need to say anything.

He's definitely someone special. Something in his DNA, right? So you wouldn't be surprised if you were to say Elon Musk. You wouldn't be surprised if you were to say Elon Musk. You wouldn't be surprised if you were to say Elon Musk. Many people ask me what makes a good founder.

Many people ask me what makes a good founder. And there's a bunch of characteristics. You can Google it. People come up with a bunch of things like risk taking, resilience, ambition, etc. And in fact, there's some research by academia that shows that people have some innate properties. So researchers at Northeastern surveyed hundreds of entrepreneurs.

And they counted that 42% of them had started a business as a kid. So actually, that's a good hint for anybody making angel investments. Maybe it's a question you can ask. Now, there's also data that shows that founders can be made. And while there are 37% of founders, the repeat founders in companies today, 59% repeat founders are in the top unicorns.

So that means at least you learned something from your first experience. So it would be reasonable to believe that there is some relationship about, you know, what's your chances of being successful to how you're born. However, I do believe there is some form, something you can do, right? There's some energy or some modification that would put you up in that chart.

And I think the wider arrow shows that the early parts of that chart, you need a lot of effort. And in fact, this is what I've learned from being an investor roughly, and these are all rough numbers. Out of the 10 companies we back, two will fail, no matter what we do.

That's just almost their destiny. And Jason wrote a blog post in 2015, so that's a long time ago, that's titled, You Don't Have What It Takes. I recommend you reading it. And basically, the summary is, some people just don't have what it takes. It would take so much effort to change them that you might as well give up, right?

Okay. And out of 10 companies we back, two will succeed no matter what. You know, us people in venture like to take credit. But truly, the founders, there's a percentage of founders that work independently of us. We backed DoorDash early on. There's a picture of their founders. And I can tell you that Tony Hsu, the CEO, would have made it with or without any of his investors.

And then there are six companies that I think we can influence. Okay. There's something we can do. And the question is, perhaps, what can you do with that 60%? How can you make them more successful? Or maybe better, if you're at the top 10%, can you accelerate their success?

That's a big question. And that's what I'm really passionate about. Can you create more successful entrepreneurs? And why is it important? Why should you care? I think this is the right audience. You don't have to say. There are many numbers to show that having more entrepreneurs is good for the economy.

You can read them. But just more entrepreneurs means a better world. So the question is, how can you build these entrepreneurs? Is there a magic machine where you can actually take a regular founder or a regular person and out comes a successful founder? Okay. So at the risk of being elitist, I am going to say, that one of the closest machines of entrepreneurship is Stanford University.

And the numbers actually show it. 10% of unicorns have founders that attend at Stanford. And what's even more, in the all-in summit, I actually went through all the LinkedIns, 40% of the speakers attend at Stanford. And I think all of us have started something, whether it's 538 like Nate or a venture firm or a company or multiple companies.

So there's some special gene, right? And the question is, what does Stanford have that other people don't have? Right? It's a higher ed institution. So for sure, you're going to go and take some classes, gain some skill sets. They put you around people that are like you. And they have a brand.

So you have access to capital, network, etc. Having been there, though, I will tell you that the skill set doesn't quite matter as much. You can go online. And learn some of that. But your peers around you and the next degree around you actually really, really matter. And in a way, what these people are doing is transforming your character.

And I can tell you that firsthand. Just imagine yourself. You may be a founder or an investor. I don't know. You are dropped in a world where you basically are surrounded by people that are constantly thinking about starting new companies. These are smart people. The ambition is very, very high.

There's innovation almost breathing everywhere. And nerding out is very okay. Right? So by doing this throughout years, you actually become one of them. And your peers are really fundamentally changing your character. You become somebody that starts to believe in themselves. You can do it. You learn basically to expand your own ambition.

Right? You may think 100 million exit is good. But if you go to Stanford, you know that's not good enough. Right? So you're setting your own bar. It's a really interesting process. And the question is, are there other machines like this? Or is Stanford just the only way to do it?

But the good news is there are other places that do this or the other forms of doing this, I would say. And one of them perhaps is the PayPal mafia. I think a lot of them running around here in the next couple of days. You all know that they started many successful companies.

Tesla. LinkedIn. Palantir. Affirm. YouTube. Yelp. Yammer. Etc. Etc. Etc. Right? There's something magic about having been there at that point in time. I haven't researched them and I don't have that much direct contact. But according to Sarah Lacy, who's a journalist and she spent a lot of time researching them, she concluded there was the confidence that they gained when they were there.

Now, I'm not sure, but maybe in the Q&A, they will reveal the secret. There's other moments that I think are really important. And I think that's the most important. And I think that's the most important thing. And I think that's the most important thing. And I think that's the most important thing.

And I think that's the most important thing. But maybe in the Q&A, they will reveal the secret. But maybe in the Q&A, they will reveal the secret. There's other mafias. This one I'm more familiar with. This is Rappi. Rappi is a company that was founded in 2015. So not that long ago in Colombia.

And it really transformed the Latam startup environment. And it really transformed the Latam startup environment. There's been 100+ companies created by Rappi employees. There's been 100+ companies created by Rappi employees. It's crazy. Almost 50 in Colombia. It literally changed the country. Which is a big deal. I have the privilege of working with a few of these founders.

I have the privilege of working with a few of these founders. And there's something common in them. They all have this sense of ambition. They all have this sense of ambition. That super fast growth. It's really interesting how they're almost cut from the same cloth. It's really interesting how they're almost cut from the same cloth.

So there are other places. And I think we had the mayor here earlier. I guess he would claim that Miami is on its way to doing some of that. I guess he would claim that Miami is on its way to doing some of that. So there are other places.

So I want to tell you about a couple of experiments that are personal. So I want to tell you about a couple of experiments that are personal. So I want to tell you about a couple of experiments that are personal. And hopefully will inspire you to do something on your own.

And hopefully will inspire you to do something on your own. And hopefully will inspire you to do something on your own. The first one is, I teach a class at Stanford. The first one is, I teach a class at Stanford. It's a startup simulation class. You have to, for one sec, forget it's at Stanford.

You have to, for one sec, forget it's at Stanford. I'm actually taking it to other colleges as well. It's not your usual class. It's actually not your usual class in the sense that I never lecture. It's actually not your usual class in the sense that I never lecture. It's actually not your usual class in the sense that I never lecture.

There is no lectures for me. There is almost no communication for me. So I've been teaching this class for six years. So I've been teaching this class for six years. We will take eight teams. These teams have four to five people. These teams have four to five people. And you cannot have a startup when you come to this class.

And you cannot have a startup when you come to this class. In fact, you must be way earlier. You only have an idea, or you may have a couple of ideas. You only have an idea, or you may have a couple of ideas. But if you have something that you've been working on for a while, you're automatically disqualified.

So everybody that comes in knows very, very little. So everybody that comes in knows very, very little. And then what the class is designed to do And then what the class is designed to do is to just maximize your peers' interaction. is to just maximize your peers' interaction. Because I believe that that's the way that you can create founders.

Because I believe that that's the way that you can create founders. So how do we do that? First, we're very lucky that I can actually craft the class. First, we're very lucky that I can actually craft the class. So even within Stanford, you have to get admitted to this class.

So even within Stanford, you have to get admitted to this class. There's only 20% acceptance. So I'm able to figure out who do we want to get in. And then the trick is to force each of us to come in. And then the trick is to force each of us to come in.

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