Deena Shakir of Lux Capital on firm culture, solving the diversity issue, and how portfolio management is a team sport - Venture Unlocked 014

Welcome to Venture Unlocked. I'm your host, Samir Khadji. In this week's episode, we have the pleasure of bringing you my conversation with Deena Shakir, general partner at Lux Capital. This was a really fun episode for me as Deena is yet another example of somebody that's taken a decidedly unconventional path into venture. Before starting her career at tech, first at Google and then GV, Deena acted as a Presidential Management Fellow at the US Department of State, where she helped launch President Obama's first Global Entrepreneurship Summit in 2010. On the show, Deena gives us her insights into what makes for a strong venture culture, why helping founders should be a team sport, and how larger fund sizes can dictate decision-making. Now let's get into this episode to hear all of that and more. Deena, welcome to Venture Unlocked. Thanks for being on the show.

Great to be here, Samir. Thanks for having me.

I think it's so appropriate that we're talking the day after election, given your background, which is so interesting and You've taken a very non-traditional route into venture. So maybe we can start off with your journey and what led you to where you are right now.

Yeah, so, you know, definitely not your typical story for, for a VC. And I'm pretty, pretty proud of that, actually. I'm a Bay Area native, one of those rarities, and the daughter of Iraqi immigrants. My father is a physician, he's a psychiatrist, my mother is a dentist. And we ended up in the Bay Area, or they ended up in the Bay Area for their medical education, my father, they finish his residency at Stanford. I went to Harvard as an undergrad. I really didn't think I was going to end up back in California. At the time, there wasn't really a clear path for somebody who wasn't a, you know, at the time really a hardware or emerging software engineer with aspirations to work on perhaps enterprise products. And for me, growing up, you know, as an Iraqi and Muslim in America who was in high school when 9/11 happened, I had global aspirations. I wanted to really focus on doing my part to create a world where 9/11 wouldn't happen again, where I wouldn't feel these two parts of my identity as a Muslim and Arab and as an American were literally at war with one another. And the fact that the war on Iraq was happening at the same time also added to that, to that desire. So I studied social studies and Near Eastern languages and civilizations, ended up in D.C. and was in grad school at Georgetown. Right as Obama was inaugurated. And that was a really just amazing time to be in DC and to witness sort of this tide, you know, this tide change in American politics. As I was in grad school, I've always worked. I've been fortunate enough to pay for both my college and graduate school independently, but that required a lot of side hustle. And one of those was as a journalist. So I was helping to cover the now famous speech that President Obama gave in Cairo in 2009, where he talked about new beginnings with the Muslim world It was pivotal. It was huge after 8 years with George W. Bush and the war on terror and the war in Iraq. And he called for a new way of doing development and diplomacy, of building bridges. So abandoned my nascent career in journalism, joined the Obama administration and, you know, out of grad school as a presidential management fellow, worked at USAID and then at the State Department and specifically focused on exactly what came out of that speech, helped put together the first Global Entrepreneurship Summit. And then the Arab Spring happened. So now we're talking 2011, nearly a decade ago, and being in the US government again as an Arab and Muslim that studied and worked on the region, it was another pivotal moment, coupled with the fact that I was actually coming back out here to Silicon Valley a lot in my capacity at the State Department, working on partnerships with tech companies, with startups, with venture firms. And as I was coming out here, I experienced this energy, this this sort of new mecca for innovation, not just for tech, but actually for everything. I was sort of seeing the center of gravity shift. You know, when I was graduating college, just a few months before the collapse of Lehman Brothers, it was still, you know, the majority of my Harvard class was going into Wall Street and consulting, and Silicon Valley wasn't quite a thing yet. In fact, I recall very distinctly when folks a few years ahead of me were dropping out of Harvard to, or considering dropping out to join Mark Zuckerberg at Facebook. And I remember thinking, oh my gosh, what are they— Palo Alto? Like, what? Why would they go there? That's where I grew up. Like, what are they thinking? They want to leave Harvard? Oh my gosh. Like, you know, obviously, talk about an anti-portfolio, right? Like, talk about a miss. Like, definitely was not at that time a sophisticated investor. But You know, a few years later that all changed. And so it was clear we were in the midst of what's now known as the Fourth Industrial Revolution. I knew that that's where change was going to happen. I knew I wanted to be a part of it. I didn't want to necessarily have a long-term career in politics or policy despite the, you know, those early days. I knew I wanted to learn how to build a product. And so I joined Google in 2012, just a few months before that election. And actually, that was my— that was a crazy few months when I started. I built out Google's Civic Information API, which powers a lot of the tech tools today that allow you to search for who's on your ballot, polling place. And then I launched that globally in a number of countries, including Kenya and Turkey and several others. So that's what I spent my time doing. Kind of the transition from government to tech started off with that, with sort of civics and social innovation. And then eventually landed on the new business development team, which doesn't exist anymore. But back then, pre-Alphabet was was a really, really cool place to be. In fact, there's a number of us in venture now who started off there, including Charles Hudson and Krishna from GV, who I'm still quite close to. And I think Katie Jacobs-Stanzen at some point was there and quite a few others. So there's a diaspora, but that team was essentially the first business person to come in whenever there was the early seeds, if you will, of a moonshot product. And so, We would be the first on what eventually became Waymo, used to be called Chauffeur, what eventually became Loon, what became Fiverr, what became X, what became Verily. So tons of fun, probably the coolest job I think that you could have at that stage in your career. And I landed on healthcare really not very intentionally. It was because of my experience working in regulated industries. I thought, oh, well, you know how to work with government. I'm sure you can work with hospitals and healthcare. Fell in love with the intersection of technology and healthcare. I helped build Google's first HIPAA-compliant product, quickly realized that big tech was actually not going to solve these really intractable problems, including healthcare. I was coming across entrepreneurs with small teams, bootstrapped in some cases, like very little resources, who were able to do— to disrupt, for lack of a better word, healthcare more effectively, more efficiently, with more impact than my team of hundreds of engineers that I was I was working with at Google. And that is eventually what, what led me to GV. So, started working a bit with the, with the team there on some healthcare diligence. We partnered with some of the portfolio companies, ended up sourcing some companies, and eventually the calling was too strong to ignore. And so, joined GV in 2017 and was there for a couple years before finding my home at Luxe last August 2019.

Well, it's such a fascinating story, and it is not necessarily the normal template for people getting into venture. But it seems like there was a lot of points of intersection from what you did in public policy to moving to GV and working on some of the type of projects you did. Let's talk a little bit about your introduction to Lux. Why did you make that change from working at GV, which for most people, and myself included, has done such an amazing job in both investing in companies, creating great technologies? What led to the departure there and then joining Lux? How did that process go?

In terms of how I got introduced to Luxe, so I've known the Luxe team for quite some time. In fact, in those early days working on healthcare at Google, I spent some time with my partner now, Adam Goldberg, who led a lot of our healthcare efforts, and talking through some of the opportunities that I was evaluating. But on a personal level, I've known my friend and my partner Bilal Zaberi for over a decade. We go way, way back, so far back it's actually our mothers-in-law who go back. They've known each other for many years, and I've been close to his family for a while. I definitely knew him and knew of Lux, but as I was, you know, thinking about my own future, it didn't necessarily like cross my mind as a place that, you know, that I would go to. And I was very happy at GV. I wasn't looking. I started getting some inbound opportunities from a number of other firms, you know, who were interested in hiring an investing partner. And I also started to develop my own investment thesis, you know, by virtue of spending all day, every day talking to these executives for partnerships and also spending the the rest of my time very closely working with the founders, it became clear to me that this is what I love, this is what I want to do, and that I had developed my own thesis around white spaces and also had a pretty strong network that would be valuable. So, I think other firms started to see that and I was in conversations with them, but it wasn't like I was kind of on a hunt for where to go next. And, you know, obviously, GV was a great place, so I certainly could have considered staying there. At this point, I— at that point, I should say, I had been in the Alphabet orbit for the majority of my career, you know, for the entire time since having left government. And I felt like, you know, as I think about this inflection point, I wanted exposure outside of that universe. I wanted to be a part of firm building. I wanted to be, you know, in a partnership that, you know, was independent from a corporate, you know, a parent company, etc. To close the loop on that, I was having conversations with a few other folks, and it essentially got back to the Lux team through some backchannel diligence. So, I got a call from my friend Bilal one day who was like, "You know, WTF? You're thinking about leaving? Why didn't you call me?" And truth be told, I actually had been trying to get something scheduled just to get his advice on where to go next. Turns out Lux was raising a new fund, and of course, always We're always looking for smart people to join the team. So, he insisted that I come in and meet with Peter, who actually I hadn't met before. You know, I knew Lux, but I knew Adam and Bilal, but I had never met Peter. And at this point, I was pretty close to joining another firm, like down to the wires of, you know, final detail negotiations. So, I came in and met with Peter and I kid you not, within 5 minutes of sitting down with him in the Lux conference room, I knew that this was where I was going to be. I distinctly remember that feeling of actually like, bringing my whole self to that conversation, just feeling totally at ease, recognizing how differentiated he was as, you know, as a leader of the firm, but, you know, how differentiated the firm was vis-à-vis the multitude of other firms that I had been talking to throughout this process. You know, it's at this point I talked to a lot of firms. So we, you know, we ended up talking for quite some time and I left that meeting, called my husband right afterwards, and I was like, oh my gosh, I think, I think, I think I found my home. And I felt that way, frankly, after every other conversation I had. So, you know, they moved pretty quickly and had me meet with the rest of the partnership. And it's one of those things where it's like, when you know, you know, and I definitely knew. And that has been confirmed over the last 18 months and it's only getting more fun.

Yeah. You know what's really interesting? And I've known the Lux team for the last 10 years. What people actually don't know about Lux is it's a firm that's been around for 20 years and started off with very humble beginnings. I think the first fund was $10 million back in 2000. And a lot of people that are listening on this podcast are starting up their own firms. And with Lux being two decades in, you having an interview with them 19 years into it, we also talk about differentiation. You mentioned you felt this air of differentiation in talking to Peter and talking to the rest of the team. What were those traits that made you feel, hey, this is a team that really understands things, and has something that represents a true competitive moat relative to other firms out there.

And you're right, Lux started off 20 years ago with humble beginnings, and Josh and Peter just a few years out of college in those early days with this hypothesis that there was a unique opportunity to invest in the earliest days of company creation and contrarian rebel entrepreneurs who were taking on some of the most intractable problems in our society. And let's rewind time, you know, 20 years, like there wasn't such a clear venture return profile. Like that wasn't the cool, sexy thing to do, right? Like now deep tech is, you know, is on everyone's radar. Frontier tech is no longer at the frontier, but it really was back then. So kudos to them for having that foresight, for having the tenacity and the grit to make it through those really, you know, tough first few years. And that, to answer your question, is a big part of what I saw and see now and love in the Lux partnership that they, certainly Peter and Josh, but really all of us have is that hunger, that work ethic, that grit. Josh is known for this quote, "Chips on shoulders make chips in pockets," right? And we certainly look for that for sure in our founders, but we all have that too. And so that was one thing that was definitely differentiated is a lot of people think about venture as like a place to go hang your hat, put your feet up, and write checks. That's not what venture is. You know that. Your listeners probably know that. It is a really hard job. It's a job that comes with incredible responsibility as stewards of capital for our LPs. It's a job that, um, is a shit ton of work. That's the case whether you're at— whether you're starting your own firm, certainly there, and even at, you know, some of the most well-known top-tier firms that are out there. You got to work hard for it. And so I wanted to be somewhere where hard work was rewarded, where I could learn from my partners constantly, where there was an intellectual rigor to decision-making. And we are damn good at that here at Lux. Like, I'm sure you can, you can tell from anybody who follows the conversations that we have on Twitter. But I love that. And I hungered for that. I wanted that. And I absolutely have that. And then at the end of the day, it's also about the humans, the people around the table. This is something that is advice that I give to, to anyone, not just in venture starting out, like the people you work with will define your career and shape you. And, um, that was one of the most important things that I was optimizing for in my own transition. I really wanted to be around good people.

So drawing from your experiences from GV and now Luxe, I'd love to get your perspective on a couple of items. The first being the decision-making framework that's used at the partnership level for prospective investments. How did those conversations go? And then secondly, the framework that's used for helping portfolio companies once they enter the portfolio.

Around decision-making at Lux, so this is part of what I really love about the team and what I enjoy about the process is, although many of us around the table, and I shouldn't even say many of us 'cause I don't really fit in this category, but majority of my partners are deeply technical. A number of them have PhDs in scientific fields, operators and practitioners. My background, of course, as we talked about, is a bit more intersectional. But despite that, we're all still generalists in the sense that we have curiosities about a multitude of sectors and can bring those types of investments to bear. And so if you look through the investments some of my partners who have been here, you know, a decade plus have made, they vary. Like, even, you know, our— like, Adam, who has, you know, a PhD in stem cells, has invested in drone racing, right? So definitely reflective of our, of our whole self. So that's something that I really like. We certainly have, and I can speak more about what I'm specifically looking at, but all of us have sort of our own thesis and ideas, and we're very thesis-driven. But we also recognize that we are whole human beings and have interests that vary more than just kind of where we pigeonhole ourselves. So from a decision-making perspective, you know, there's generally, um, you know, excitement from usually one partner, or maybe it's, it's more than one, who gets to know a founder, a team, a space, you know, there's consensus building that happens. So, um, prior to bringing a founder in for a partner meeting, there's usually a subset of, uh, of Lux Partners who get to know the founder or founding team, and then we bring her to, to the table, and, um, you know, there's a conversation with the entire partnership, and, uh, and we all participate in that decision-making process, um, from that. So given what I just said about the intellectual rigor, that can result in some pretty fun debates, um, and again, that's What I want, what I sought out, and one of the many things I enjoy about the decision-making process here.

Going back to the second part of that question around, okay, a company becomes an investment, a core investment of yours, what does it look like? And do you have some kind of systemic framework that you offer companies from a value-add perspective? Of course, venture investors always talk about value-add, but I always love to dig into, is there something tangible is it repeatable and is there some durability in how you deliver those services?

GV is on, I think, one end of the spectrum, probably with Andreessen as well, in terms of having a really strong, large operational team. So the majority of my colleagues at the time at GV were actually focused on post-investment. And that was something that, from the outset, one of the differentiators of GV as they felt vis-à-vis the industry in terms of really having lots of operators, product-focused folks who helped with everything from like user research and design thinking to, you know, the partnerships work that I did with my team to recruiting and all of the above. And that certainly, especially for a certain scale of company, comes in handy. Luxe, you know, had a different model and still does in that it's a smaller team, but when you join the Luxx portfolio, you literally get the entire partnership. Like, I'm on a, you know, texting, first-name, familiar basis with many founders and CEOs in our portfolio that are not my investments. And that is the case with investments that I have made as well with some of my partners. So we all bring to bear our networks, our experiences, um, in that regard. And I think from a founder perspective, you know, there's certainly depending on the sector you're in, there's a lot of value to those teams that are focused just on post-investment. But there's also, from what I've heard, there's a huge appreciation for having a really involved board member and a really involved investor and having that direct relationship as opposed to having a really like decentralized touchpoint across a firm. So I think that Lux does a great job of that and I try to do the same.

Well, that definitely speaks to a culture centered around teamwork and integration. It's also clear that as firms grow, it becomes tougher because you add more partners, you add more people to staff, and also people tend to be more decentralized when it comes to location. I know Lux has multiple locations, and I'd be curious how you think about, as a firm, keeping that culture intact, maintaining it, and doing it despite a time right now that makes it even more difficult given that people can't sit around the table every day together?

You know, for us, we've for the last 10 years been a bicoastal partnership. And that's right. So although we started in New York, you know, Peter came out here about, about 10 years ago and opened up the presence here in Silicon Valley. And now we're, you know, evenly distributed across two coasts. And so what that means is, you know, pre-pandemic, we've always, you know, had our partner meetings to, you know, over Zoom to some extent, right? Usually there's folks in one conference room and another, so just a lot more screens with the pandemic, but, and we've had to organically work on relationship building and trust building outside of that physical kind of proximity. And so that when the pandemic hit, I think that just the fact that we were used to that really helped, but we also implemented, you know, practices to be in touch more, right? In terms of, more meetings throughout the week with the partnership, more opportunities to engage with each other on a personal level and trying to kind of replicate what, what, what might happen organically in a physical space. Other than that, you know, one, one thing that's really valued at Lux is growth for our investors. And so that is certainly, I think, differentiated because of the other firms. If you look at some of the partners around the table, they've started off, you know, in some cases as interns. In other cases, as, you know, associates, and really worked their way to partner. So that's something that really makes a difference, and that's not necessarily the case at many other firms where it's quite difficult to grow your career.

And I think that's 100% correct. The partner path isn't available in many cases and certainly isn't obvious. As you look to onboard people and you've grown the number of people both on the investment and operations side pretty dramatically over the last decade, and a lot of the people that are listening to the podcast are also scaling. What does that interview process look like? What are you looking for in a potential Luxx employee, whether it's investment or ops? And how clear is the value set when you are talking to prospective hires?

I certainly fairly recently experienced it from the one on the other side of the table in the interview. And then now we've had a chance to get to know some folks as we consider you know, what our team will look like moving forward. So it's something that, you know, I think part of it comes from the fact that, you know, Peter and Josh literally built this firm, right? And we talked a bit about what those first few years looked like and how much perseverance and grit it took. And so, you know, I really admire their commitment to preserving that special secret sauce, if you will, of Lux while also expanding. You know, we now have $2.5 billion under management. We're not quite the $10 million seed fund we were. We have a bicoastal team. We invest across everything from pre-seed to growth. All of that has changed a lot. And yet, we still, if you talk to our founders that we've invested in last month and the ones that we invested in 20 years ago, we still have that very differentiated, intimate value-add touchpoint. And that is reflective of the team and who we all are. And so, it's something that we take very seriously. Culture, for lack of a better word. And we think very thoughtfully— that's pretty redundant— we think a lot, I should say, about how we complement our existing networks and skill set as we bring on new folks. That's really important. So there's a lot of conversations recently, some of which I myself have contributed to on the writing front, about the importance of diversifying our investor base to contribute to a more diverse portfolio. And so obviously representation matters, and certainly gender and race, ethnicity are part of that, but there's a lot more to it than that. So diversity of academic background, diversity of socioeconomic background, diversity of geographic background, diversity of— so all of that is really important and it contributes to a better discussion, debate, and I think investment decision.

And I do want to come back to that point in a minute here, but having been in venture now for two decades, I've seen so many firms that have stayed durable. And the Sequoias of the world have just done a fantastic job of being incredibly successful across times, across geographies, but it's really, really difficult as things evolve. And one of the things that's often underestimated is people. Some of the best firms have had massive talent drains. Cultures that actually aren't conducive to great persistence of returns and long-term durability of a firm. One thing that changes over time, and you just mentioned it, is that as you get successful, you have LPs that want to invest in fund sizes tend to grow over time. You just closed roughly $1.2 billion over your last fund, 6th and Opportunity Fund. Has this changed the calculus on decision-making internally Do you look at companies in a very different way? Because we know the law of large numbers, it is tougher to return a 3x net on $600 million than it is $200 million. Walk us through how that's transpired since you joined.

Absolutely. And I'll caveat it by saying that I joined with the— literally the same day they announced the fund, they announced me joining. So I don't have the background outlooks in terms of what it looked like before, but I can tell you, kind of having joined on that very day, this sort of transition that I've noticed, the evolution, the discussion, and it's very much still a work in progress. One question we get asked a lot is, how do you evaluate an investment? How do you have the same team of investors looking at new co-incubation all the way through late-stage growth? Like so many of these other funds have separate growth teams and seed teams and so on. It's a valid question. We definitely obviously recognize that there are different ways of evaluating a market, a founder, a team, you know, when the company doesn't even exist or is about to exist, you know, versus when you're, you know, you have clear kind of metrics and data points to look at. But we intentionally have kept the same group of investors because at the end of the day, you know, to the earlier point I made, it's it's critical for us to preserve like, you know, the integrity of that Lux process, both from a team and from a portfolio construction perspective. You know, as our fund size grows, like, you know, it's, we have to think about opportunities differently, we have to think about markets differently, we have to, you know, we have to think about outcomes differently. And that can be challenging, but it's a conversation that we kind of all push ourselves on, especially, again, I joined right as we were making this transition. So it's a bit more kind of organic for me, but for from some of my partners as well, just like over time, there are companies that we would've loved to have invested in and we probably would have and we probably would've had a really good outcome with those in those earlier days and at different fund sizes. But now maybe it doesn't make as much sense. How are we going to preserve that responsibility and honor that responsibility we have to our LPs who, by the way, just We talked about impact earlier. It's not just the impact of the companies that are innovating in new spaces and creating opportunities, but we honor the LPs, in many cases, some of the most esteemed philanthropic institutions and educational endowments and so on. And that's important for us. And so we have to be able to return the fund and invest in companies that are going to have these really breakthrough outcomes.

I agree. And, you know, I think it's always something that is evolutionary in thinking through investment models and competitive landscapes as you get bigger. But it also comes back to the same thing of maintaining a strong team culture and making sure that the people on board are complementary with one another, are as diverse as possible. And you spent a lot of time thinking about this, both in your history in public policy but even more recently talking about the need for more diversity in venture capital. AllRaise has done a great job in fostering more growth of female investors. What do you see as the future? Why is this so important?

You know, I joined venture at GV just a few months before that, like summer in 2017, where shit hit the fan in terms of, you know, the whole world, right, with MeToo and also a spotlight on some of the really entrenched problems in venture. But my experience and passion around diversity in tech started much earlier. And one of the first projects, you know, the first year or two that I was at google.org that I worked on and helped lead was around getting more women into computer science. And there's actually a lot of parallels in terms of, you know, Google was the first big company to release their numbers around diversity. It's not on the investment side, but on the product creation side, there was increasingly more data about the value of diverse teams and building products. It wasn't just about diversity for diversity's sake or because it's a good thing or a charitable thing. That's patronizing and just not accurate, right? It's about much more than that. It's about building a better product, about having a better outcome. And so, I worked on a number of initiatives, including helping to you know, support Girls Who Code and Code.org and, you know, the Geena Davis Institute, working with, you know, with media and Hollywood to write characters into TV shows. So kind of had a depth of experience in that. And fast forward, when I got into venture, I myself experienced prior to even joining GV how challenging it was as somebody who not only looks different, like from a gender perspective, from an ethnic perspective, but also has a very different background. I even remember when I was joining Google, by the way, we didn't talk about this, but that was one of the hardest transitions I've ever made. I, I remember getting dozens, maybe more, but at least dozens of emails back from recruiters when I was trying to get into Google telling me sorry. Well, first of all, maybe no, usually no responses, but if I pushed and got a response, it was, you're not a fit, you didn't go to business school, you know, you don't have a technical degree, even though you know, I was very product proficient, you know, you didn't do McKinsey, etc. I worked really hard to figure out how to penetrate these really closed circles and worlds, and, and that was really hard. Even harder than that was getting into venture. I, you know, I've told people, like, getting into Google was harder than getting into Harvard for me. Getting into venture was harder than getting into Google. Um, and not, not at Luxe per se, because we talked about how kind of organic that was, but, but really having that first experience at GV prior to that was really difficult. You know, I wrote about this in my last piece in Forbes. One of the benefits, I think, of the last few years, although there's been limited progress to date in terms of diversifying both the investor base and the founder base, is there is finally a proliferation of data. Like, that's the most important first step. That's what we started with at Google when we were talking about you know, the engineering pool and diversity. And that's what we need to start with now. So it's not— so it's first like, this is the problem. This is not about— again, it's not about philanthropy or charity or being a good person. It's about outcomes. And we have clarity around datasets looking at women-led companies and underrepresented minority-founded companies. And not only the really bad data right around like how they're getting funded and so on, but the really good data that's showing us better outcomes, more diversified teams, better ROI, stronger boards. I mean, I could wax prolific about this for a long time because it's there, but that's clearly not enough because this term now that's become commonplace, but it still exists is unconscious bias. That's very much there. Venture, it was hard to get into if you weren't part of these closed networks and circles. And then getting funded was hard to get to do as a founder if you weren't part of that. So that's now, you know, the Kauffman Fellows program, which I'm a part of, and I know you are as well, has released excellent data showing the outcomes of bringing on a more diverse investor set and what that means for a more diverse portfolio and what that means for a more diverse employee base and what that means for the broader economy, which is the point that I was making in in my piece. Like, I truly believe that the post-COVID economy will rely on women and minority-led businesses. And we know now from looking at data from 2008 and the recovery there that those businesses contributed more jobs to the economy than the ones that were started by, you know, cis white males. So how do we do that? You know, I'm obviously saying this myself as, you know, as a woman in venture, but like, I am more than that. And I recognize that there's room to grow across the industry in terms of further diversifying that base, but it starts early. And that's what I learned from my time at Google. Like, you know, initially we started looking at, okay, let's, let's, let's figure out why we don't have enough computer science graduates. Okay, well, here are the number of women who start taking Intro to CS. And then we looked into the attrition in those classes, and we looked into why that was happening. And it was, you know, there were classes that were, you know, problem sets where you'd focus on like, you know, very gender normative problems. Like, you know, let's play this football analogy and let's do this video game. And, you know, and women, in addition to being the minority in terms of numbers, also just felt like they weren't being seen. So we went earlier, earlier, earlier, and earlier. And eventually, you know, one of the programs I worked on was this Made with Code campaign where we went going after the problem in the earliest days and trying to get young girls to recognize the opportunity there. And, you know, now there's— I remember seeing data from The Conscious Parent recently around literally in the toddler years, like I think it was 18 months or something like that, these biases start to get ingrained in us. So I think that is something that venture needs to take a page on because both for the investing side and for the founder side, like, these are really deep-rooted, entrenched gender and racial issues, and the pandemic has shined a light on them. But we have to be able to talk about them. And that's the other piece that I think is really important. And I know this from my own experience in the past, but a lot of folks are afraid to advocate for change and call for change until they themselves are reflective of a quote unquote perfect situation. I think that's problematic. I don't think the two should be dichotomous. Right? I think you have to be able to be self-reflective, call for, call for change, like, and you can't wait. Because if you do that, first of all, you're contributing to tokenism, right? We don't want to like have a world where somebody is getting hired because they're a woman, right? Or because of this, like, that's That's not what I'm calling for, and I don't think that's what anybody wants. We recognize it's not a pipeline issue. They exist out there. It's about diversifying networks to get those folks in. So I think that's something that we all need to be more open to without, you know, just making sure that that voice is not something that's immediately going to be canceled, right, or called out.

I think from, you know, my own standpoint, I'm very optimistic. You brought up the clear data that suggests the importance of diversity of thought. And people of different backgrounds, whether it be ethnic, socioeconomic, or other, as well as the fact that there's peer awareness right now, which is also acting as a tailwind. But I also think we need some systemic frameworks. I think LPs need to require that firms hire people that have diverse backgrounds. I think that we want to see more LPs back underrepresented managers that are starting their first funds. All of that together, I think, will get us to the right place. I don't think it happens overnight. Based on the early metrics I've seen, I'm very, very optimistic, and I certainly hope that people like yourself and others that are bringing such great leadership will get there sooner rather than later. With that said, I want to end with a personal heat check round, rapid-fire questions. And the first question is your biggest career mistake and what you learned from it.

I think it's actually a theme that threads across a number of mistakes that I've made, and that was really just in those early days, feeling like I had to make a choice between, for lack of a better word, between doing well and doing good, right? So for me, it was like, well, I'm not gonna go down that path. I had an offer from McKinsey and I turned it down. I considered going to Wall Street like the rest of my class, but no, I was gonna repudiate that. I was gonna focus on making the world better, and the way to do that was to be like a starving academic or, you know, hopefully not starving, but to, you know, to go, to go down that path or go into philanthropy or go in. And it took me a while to actually being in those fields to recognize that, like, it's a lot more complicated than that. That's, you know, change requires a multitude of stakeholders working together and that we could all benefit from having had touchpoints across different industries and also that there was a really, really important role of the private sector, of the investment world of technology in contributing to that change on the ground. And so I think that's the thing that I wish I knew when I was younger, if my older self would tell that college graduate that.

Yeah, no, that's great. And I acknowledge that you've been only at Lux for a couple years now and you didn't go down the path of starting your own fund, but you were part of Kauffman Fellows, as you mentioned, and I know a lot of your colleagues in Kauffman are starting their own fund. What piece of advice would you give for somebody that's starting their own fund, drawing on your experience at GV and now Luxe?

I'll start with the preface that, you know, having not started my own fund, you know, maybe I'm not the best person to be giving that advice, but I can give my experience from having made transitions, from having witnessed, you know, quite a few of my Kauffman classmates go through this path, from seeing what's worked and what hasn't with folks that I've interacted with. I'm sure you would agree with this, but there is such a parallel between the founders that we invest in and ourselves as investors in terms of the relationship with fundraising and our LPs. And the biggest, I would say most consistent kind of observation that I hear from folks who are doing that is just that, like, oh, wow, I get it. This is what it was like on the other side of the table in terms of, oh, first-time founder, first-time fund manager. You look different than the other founders I invest in. You look different than the other VCs I invest in. Like, you know, what does that, you know, let's diversify our cap table. Let's diversify our LP base. Like, all of those things really are strong parallels. And I think that having that empathy and having that experience as the GP in terms of investing in companies really helps as we make the transition to building a firm. I think that's probably the biggest piece of advice I would say is to constantly put ourselves and have empathy and put ourselves in the shoes of the other stakeholders around the table because none of this happens in a vacuum.

Yeah, no, that's great advice. And what I find about when I do have guests on the show, there's usually an investor out there that they aspire toward or really respect. I'd be curious, do you have an investor that you look up to the most, whether it's within venture or outside? And what makes them so special in your eyes from a characteristic standpoint?

There are quite a few role models that I have in the industry. I think one of them is someone that I still very much consider a mentor and friend, and that's Maha Ibrahim at Kainan. She's been a source of advice for me throughout the years of my transition on a very personal level. She's probably one of the only other investing partners of Arab and Muslim descent. So there's that, like, that I can relate to. She's a mother of two. Of two boys. She has been in venture such a long time, way before it was a thing. And she did all of that without the sort of hubris or brand building around her. She put her head down and did the work. And she's had some really, really great outcomes. And she's— so she's someone I really look up to there. And partially because of that humility, that work ethic, and that sort of get shit done mentality.

Yeah, well, I mean, she's certainly an inspiration to a lot of people and has done amazing from an investment standpoint. Deena, thanks so much for being on the show during this crazy election week. This was a lot of fun.

Thanks for having me. This was so much fun, and I always enjoy our conversations, recorded or otherwise.

Thanks so much for listening to another episode of Venture Unlocked. To learn more about Deena, Lux Capital, and a summary of the show, please be sure to go to Apple Podcasts or Spotify where you'll find detailed notes of the episode. While you're there, please rate us and review. It really helps us out. And hit the subscribe button in order to get each and every Venture Unlocked episode as soon as it's released.