Jesse Draper, Founding Partner of Halogen Ventures, Just Go Grind Interview

Jessie, welcome to the show.

Hi, I'm so excited to be here. Thank you so much for having me. Um, I know I've been a nightmare to schedule, and then I was 15 minutes late today, and it's just like, you know how you have those relationships in your life where you're always late for those, but then you're early for everything else? That's me, and that's our relationship now. So I'm gonna try and Fix it from here on out. My phone's already gone off in the first 30 seconds. But how are you?

I'm good. I'm good. I'm excited that you're here. I'm glad we could talk about Halogen, everything you're doing. I love especially talking to founders and VCs supporting underrepresented founders. So another reason why I'm excited to have you on here. I've talked to like Marlon Nichols and Charles Hudson and people who are supporting in all different ways. And That's always fun for me as well. And I think it would be helpful for context for people who don't know as much about Halogen. What are you investing in today? Where are you investing in today? Check size, kind of high-level view, and we'll take it from there.

Sure. So I'm Jesse Draper, I run Halogen Ventures. We invest in early-stage female-founded consumer tech. So what that means to me is there has to be a female on the founding team of 5. We write $250,000 to $1 million for initial investment. We typically get in at pre-seed, seed. We co-invest actually with Charles Hudson, who you just mentioned quite a bit, at Precursor. We have about 62 companies. We've had 10 exits to date, most recently sold Squad App to Twitter. And we look at everything from fashion e-commerce, Love it.

And there's a lot to dive into there. I want to talk about some specific companies a little bit later. But there's so much backstory to you actually getting into venture from your own fund perspective. But then also, you did some like angel investing out of like, I think it's Valley Grove Ventures was the name I want to say, as well. How did that all play into you ending up with starting Halogen?

I'm definitely not your typical VC. I, you know, I'm a very, very got here in the most convoluted way. But when you look back at your journey, don't you feel like it's never a straight line?

Absolutely not.

Like, you know, it's very convoluted. But I'm a former entrepreneur. And before that, I actually went to UCLA School of Theater, Film, and Television, and I focused on acting. I had some success and was on a Nickelodeon show and was in entertainment. And, you know, let me bring you back to like, this is like '08, 2008. And I quickly realized that while I respect the acting profession and the film industry, et cetera, I really— I grew up in Silicon Valley. I'm a 4th-generation investor and the first female. And because I was female and I only saw incredible men in front of me, I didn't think I could do it. Like, I didn't think that even though all I knew growing up around entrepreneurs and investors was technology and like this tech this sort of like newly booming tech industry. I didn't think I could go into that. And then, you know, in say 2008, I was coming off of this Nickelodeon show and we'd film 6 months on, 6 months off. And instead, that year I decided, it was our 3rd season of the show and I decided, you know what, I think I'm not gonna audition this year. I'm gonna kind of go explore the world a little bit. And so went back to LA and I was invited to one of the first Twitter conferences at the the Skirball Center. And I remember going and being like, I weirdly feel very comfortable with men in suits and I feel like there's something here. And I grew up around entrepreneurs, really respecting entrepreneurs and innovation. And so I was like, you know what? I think I can be more productive than going to these cattle calls where I often just felt incredibly yucky. And I went to this— I don't know if you know who Jason Statham is, but it was like Transporter 3 or Transporter 2 audition. And they had— I walked in, there's like a room of 100 girls. And the organization that called the cattle call was Charlie's Bodies, which didn't resonate with me till after. But my agent had sent me to this audition. And I walked in and I was like, wow, everyone's like, this is There's a whole bunch of beautiful women in this room. This is crazy. I waited 5 hours and walked in, and Jason Statham and his producers were there. Perfectly nice, but like didn't ask my name. They were like, turn around, turn around. I'm like, do you want me to read? Do you want— oh, okay. And they're like, no, thank you. Goodbye. And I was like, wow. And I walked out of there, and then I started thinking. I was like, oh my God, this is literally a cattle call for bodies. Like, they just want bodies. And I felt so gross and I was like, I sat here for 5 hours for 30 seconds. And I just was like, I know that there's more here. There's more I want to do. And so went to this Twitter conference and both these things kind of happened simultaneously. And I just decided I was going to start a talk show. It was like the early days of the blogosphere. I started it online. I kind of moved home to my parents' garage and like— Started just inviting over some entrepreneurs I knew. And then from there, we did 5 seasons of the show. I created one of the first tech talk shows. And now, as you know, there's quite a few. But back then, it was like there were none. It was like us and Forbes had just launched Forbes Video. They weren't even thinking about technology. And we were one of the first companies to partner with Forbes ultimately. We took the show to TV. We acquired Lollawag, this LA tech blog. And we kind of were building out like a Business Insider approachable technology company that was trying to glamorize entrepreneurship. And I always had this idea like these entrepreneurs should be on the COVID of magazines and they just weren't back then. Back then it was Lindsay Lohan and Paris Hilton scantily clad on the covers of magazines. And don't get me wrong. Clad nanny on a Nickelodeon TV show. So like nothing wrong with that. But it was just not what— like I just was like, there's more. And now it's amazing to see that this has happened. But anyway, I digress. So I ran this talk show for 5 years, ultimately took it to TV. We were nominated for an Emmy. And we were interviewing great entrepreneurs all along the way. I did 5 seasons of the show and after 2 seasons I quickly realized I'd only interviewed men in technology. And I was like, I am facilitating this problem that I saw growing up and just around me all the time. How do I change this? So I made an initiative to interview 50% women in tech and they came. And this is like early days of fashion tech. So I'm forever grateful to the women of fashion tech like Jen Hyman from Rent the Runway, Rebecca Minkoff, the Gilt Girls. Because they made it okay then for Sheryl Sandberg to come on my show before she'd written Lean In. And then all of a sudden it was like Aneesh Chopra, the first CTO of the United States of America, and Mark Cuban, and it really blew up. And so I kind of, through that show, was watching these early-stage entrepreneurs come and these women in particular come and they're trying to get exposure for their companies. And sometimes I'd say, you're a little early for the show, love what you're doing, How can I help? And I identified 2 problems. One, these women in tech were not getting enough media exposure, which was part of the problem for me growing up as a little girl thinking I couldn't go into this industry. And then 2, they weren't getting funded. So at first, I started trying to help them get funded and I'd send them to whoever I knew in venture capital. My dad was at DFJ, Sequoia, wherever I could find— I grew up literally around the corner from Sand Hill Road. And then I realized I knew what a good deal looked like. And I didn't have a ton of cash, but I'd write them like a penny's check or negotiate some sweat equity if I thought the deal was interesting. And some of those deals did really well for me. One, I sold for a 25x return on the secondary market in less than 18 months. Fast forward to Got married, was pregnant with my first kid, and my husband's like, so I'm gonna be honest with you. Your show's barely breaking even. He's like, it's out there, but it's barely breaking even. And your investments are going really well. You're also having a baby and you're staying up 24/7 running this company, producing this show. Like, you're killing yourself. And you can't do both of these things. And so he really gave me like the courage to go just try to raise a fund, which maybe deep down I thought eventually I would do, but I didn't think I could do it honestly because I was female. It's so silly, but like as a kid, it's like, you know, they say you can be what you can see and I just didn't see it. Like, I didn't see women in tech. And so I just went out and tried and I just pitched 500 potential investors, got turned down by about 450 of them. And Closed 50, raised my first fund, and now we just closed our second fund. And that's where we are today.

That's incredible. A lot to dive into with that. So with the first fund, though, so getting that first one, you get to the point where, you know, you want to at least raise a fund, which is obviously different than you had thought previously. Maybe eventually you thought you might get into that. But raising that first fund, I know from a different interview you've done, mentioning how, you know, the whole problem of investing in women or people of color, whatever it may be, is like LPs starts at the top, it really starts with LPs investing into funds. With that first fund, how did you approach the fundraise in terms of who those LPs would be? Obviously took a ton of meetings to do that, but how were you thinking of it back then?

Back then, I was just like, who has the money to invest in a fund? I mean, I think you're just kind of like meeting as many people as you possibly can. And as a VC, that's part of your job. You're filling your day with meetings, often entrepreneurs, potential investors, co-investors. You are just in the business of being the most networked human on earth. And I was really lucky because I'd run this tech talk show and some of those entrepreneurs at that time had actually started to do incredibly well. And so I started just by tapping my guests because as a talk show host, as you would know, you get to spend an hour or 2 with these people and you get to know them. And then some of them would come back to the show. So it was spending time with people like Mark Cuban and the Gilt Girls who I mentioned. And some of my first investors ended up having been guests on my show. So like Alexis Maybank from Gilt Groupe was one of my first investors, Rebecca Minkoff. And then Todd Wagner, who was Mark Cuban's business partner from Broadcast.com, ended up being one of my investors. And he had been on the show and that's how I knew him. And so I kind of just started tapping that network and then beyond. And you have a lot, you know, I'm saying I pitched 500 people. Like, there's a lot of people you quickly evaluate like, oh, I thought this was a potential investor. It's not. And it takes you a minute to kind of figure out what those categories are. In addition to being a potential investor, it takes you a minute to dive into who is the right type of investor for your fund. So I thought I was going out after female billionaires. I thought I was going after these women with a whole bunch of capital and they'd be down to fund my fund because we're investing in women and really trying to change that whole ecosystem. And I was totally wrong. I was so wrong. And I'm not saying I met with all the female billionaires. It turns out they're really difficult to get ahold of.

Go figure.

Yeah, go figure. I did sit down with quite a few of them. And what I realized is men actually were better targets because men are comfortable with investing and they're very comfortable with investing in funds. And they're also willing to take that risk. And the women who were open to investing, like Alexis Maybank and Rebecca Minkoff were entrepreneurs themselves who had had some success and had become comfortable with that risk. So what I found is these women of wealth, essentially, I'd have private wealth managers introducing me to, hey, here's a potential investor, female philanthropist, has $1 billion sitting in the bank. And I'd have 6 or 7 meetings with these people. This is another lesson for fundraising. You know in 3 meetings, don't waste your time. Like, we don't have all the time in the world. But I'd waste so much time with them and I'd finally go like, why aren't you making this investment? You're still spending time with me. What isn't getting you to cross the bridge? And they'd say, well, I don't really understand venture capital. And some of them would say, maybe you should talk to my husband. And I'm like, by all means, send me your husband. I would love to talk to him. This is crazy. And what I've realized over time is we've done a huge disservice to women. We have taught women to not talk about money at all. And we've taught women actually something so much worse, which is to give away money to philanthropy before they know how to grow money. And so it's actually been very frustrating for me as a fund manager. And now knowing that, I obviously don't spend as much time trying to close that type of investor. But what I would encourage out there to anyone listening is if you are a female, put your money to work. The only way you're going to learn is by taking that risk with your capital. Buy some stocks, buy some crypto, take risk and learn. No one knows everything. It's all a freaking gamble. And then for all of the incredible men out there, we need you. Talk to women, talk to your significant others, friends, daughters, colleagues about money. Include them in these conversations and then also champion them. I think there's so much more that— I don't know why it's become so taboo for women to talk about money. And that's, I think, changing a little bit more now. But when you go to the generations above me, it's Yeah.

And it's such a challenge then, because again, going back to how you actually fund female, female founders, and also then underrepresented founders, if the LPs don't look like them, it's hard. It's more difficult. It's definitely challenging. But it's nice to see funds like Harlem Capital raise $100+ million recently. I know Maren Nichols for MAC Venture Capital just raised $100+ million. So like, there are more of those that are starting to be raised, at least at the funds. Yeah. But it's still a challenge. Now, again, more LPs then investing in these funds is going to be helpful for the founders in the end. But it takes more awareness and more knowledge around that. And that's something we're working on at Vitalize, really trying to educate people on what is angel investing, what is venture capital, because if you can do that as a starting point, get people interested in it, then obviously you can increase the amount of capital that flows then ultimately to underrepresented founders.

Yeah, I completely agree. And you know what we've found, I do say, I always say sort of like, you have to pick your bucket, like, what are you investing in? And for us, the Batwoman signal is the women, like we call women. But because we went off of that traditional Sand Hill Road, Silicon Valley path and said, hey, we're looking for women, we have over 50% minority-led companies just because we were looking for the best. We were looking for the best talent, the best companies, the best ideas. And we got this incredible diaspora from across the country instead of from the same places. And it just shows that diversity— we think about diversity as a fund in age, race, and gender. And I think that's so important. And if you hit all 3 of those in the earliest stages of the company, you will create a billion-dollar success, whatever it is, because you have all angles. And I think that's a really, really important thing for founders to think about at the earliest stages.

Yeah. And one of the things I want to dive into is more of how you've, you've helped your companies with both your experience with media, as well as just making connections with your network. But first, taking it back to the fundraising, going back to Fund 1 versus Fund 2. What was the difference for you? Obviously, you just recently closed Fund 2, $20+ million fund. Differences from fundraising from your perspective, things that were helpful for you as you were raising Fund 2, which is a little bit different than Fund 1?

Oh, so many differences. I had a track record that was bigger and better and we'd had some returns. And then I was able to target investors more seriously. And I also knew who was a potential investor and who was not. And I could kind of sniff that out more quickly. But there's still something very broken in early-stage managers. It's like, It does, as you were alluding to before, it does start with LPs and the LPs still don't look, they don't have any diversity. And even some of the LPs who claim to be investors in emerging managers or they love emerging managers, like, here I am, I'm an emerging manager. I'm on my second fund. I have a real track record. I have more returns than so many early-stage investors out there. And they're still saying, well, we want to get to know you for 5 to 10 years, a couple funds. I'm like, in 5 to 10 years, I'm not going to need you. I'm going to have my investor base. And they're like, well, we want to invest in Sequoia. And if we can't get into Sequoia, why would we invest in you? And I'm like, we're going to be the next Sequoia. This is an emerging managers program. Why are we talking about Sequoia? And there's something broken there. We need better emerging managers programs. And what's interesting is if you dig into the data and if any of these larger LPs, actually the pension funds, et cetera, actually broke out a real emerging manager strategy, they'd realize that the returns are so much better. So much better. But it'll happen eventually. I think there's Starting to hear it, but it's just a very slow-moving process. But yeah, second time around, I mean, for all of those first-time fundraisers, whether you're an entrepreneur or a fund manager, just get out there and plan on having at least 100 meetings. And don't even take the nos seriously. Like, just like, okay, I'm talking to the wrong person. And I'm usually pretty grateful when someone says no, because then you're like, great, I'm not going to spend my time with you. I'm going to go find the yes.

Moving on. Yep.

And, you know, it's— I'm grateful. I— it's really frustrating when potential investors are just like hemming and hawing and they're like, oh, and they don't get back to you for a while and then they come back and then they're sort of like— I do think there's a part of it where sometimes they just want to see if you've made progress and they're getting to know you that way. But, um, I'd rather someone just say yes or no up front. Um, and Then you can kind of move on because fundraising is a, it's a long and painful process. And so you want to just be moving as fast as you possibly can. But I'd say have at least 100 meetings. After 20 meetings, if 20 people have said no, I'd go back, look at your deck, call a couple of them and say, hey, what wasn't getting you across here? Like, what were you concerned about? Because something, sometimes it's so simple. Sometimes it's like, well, you did IRR on this weird thing and I didn't really understand that. And it's like, oh no, no, like we've returned a ton of capital. So maybe I need to make that clearer in my deck. And sometimes it's just something so simple you could add a slide and it's no longer an issue. So, and then feedback's really great. So when you can just ask these people for feedback, I think that's important too. It'll help you move faster. Yeah.

And that's one of the things from like the number of couple hundred people I've interviewed. It's always iterations on your deck and iterations on your process even. And people who have gone through that, who like, I've interviewed some people who have raised, you know, Series C, Series D, like they just refine their process now. But even at that later stage, it's different expectations and they still just iterate on it. Everything they get from terms of feedback, they're iterating on that again and again and again. And you learn that that's just the game that you're playing ultimately. And people will say no because they're just not a fit sometimes too. So just And going back to the helping founders, so you had obviously a number of exits before Fund 2, track record even built up before Fund 1, where you started to invest in companies as well. Your background with media experience, as well as helping companies both fundraise and hiring through your network, which is insane, I'm sure at this point. Take me through some of that in terms of how you're helping founders in your portfolio at Halogen.

Yeah, you know, I think we're very hands-on investors compared to most. We— these are early-stage companies, and so they often don't even have a good lawyer in the beginning or don't even know that they need a good lawyer or a lawyer with a startup program who, you know, works with deferred pay so they don't have to pay till they get funding. And, you know, we try to help put all those pieces together. I think as a VC, you really have this like bird's-eye view on What it takes to run a successful business and grow a successful business, and we try to plug all of those things in. I would say we're called for a whole lot of things from our founders. I mean, when you have like 62 or more, I need to figure out what the exact number is right now because we've been doing quite a few deals, but it's over 62. You're called. You know, we're like the 24-hour hotline. But we, you know, I love working with them. We get called most for yeah PR and marketing and go-to-market strategy help, especially because. Were in consumer. And the reason I went into consumer was because I understood media from every angle. And I look at media as simply a vessel for which to sell things through. And I knew that I could help sell these products. And I knew that, you know, sometimes I see a great company and I'm like, this product's amazing and it'll sell itself. And sometimes I see a product that might be in a busy space, there's some other competition, but I'll invest in because I know I can like put them on the map because we just know how to do that. So we do. We also have Ashley from my team is building out our whole influencer marketing initiative because we realized we organically worked with quite a few influencers and celebrities. And so now we're trying to formalize that in a new way. So we really do help in terms of marketing and getting your products out there. We also try to help hire. I mean, I think as a VC, you're also this hiring firm where people are calling you for jobs because they know you have access to these 60+ companies. And then you have that access to great talent then, and then your companies are trying to hire. And especially at the earliest stages, they're Trying to cut costs wherever they can and not necessarily use a hiring firm. And so we'll help place people pretty regularly. And then the, you know, what is the third thing that we help with the most?

Fundraising.

Thank you. You filled it. You filled the gap. I'm like, what is it? Oh yes, they always need more money.

I knew it.

I knew it. They always need more money. So fundraising, I mean, we put together whole strategies for them. We are really hands-on. We sometimes help them sit in on the meetings. We'll work with their pitch decks. We do whatever we can possibly do to help them with the fundraisers because some are so good at fundraising and some are not. And like, you just have to know that going in, like, they're going to need a lot of help in their presentations because they just don't present well. But the company is amazing, so we have to figure out how to like rectify this. But yeah, fundraising, funding, plugging them into more investors, getting them the capital that they need.

Yeah, I want to double-click on the media thing. I know you said you understand it so well from a lot of different angles. The influencer side of it is just one part of it, but what else goes into that in terms of consumer companies, things that are helpful around leveraging media obviously to sell and grow their company. Anything else that top of mind or things we can think of that might be helpful for other founders out there?

Yeah, I mean, we're thinking, we try to think of everything we possibly can, whether it's like, yeah, getting these influencers involved at an early stage. We try to stay on top of all the new trends as well. Like we're looking at Clubhouse and I kept being like, how is this thing going to monetize? And, you know, now you're seeing influencers go in and host rooms for Coca-Cola and, you know, just kind of be the face of the room, but also be like, I love Coca-Cola. And it's fascinating how it changes regularly. So, you know, we have great people we work with kind of like in the podcast arena all the way to talent agents and managers. And we also will help put together like, okay, here's how I think that we should launch. I mean, marketing so much more. And then go-to-market strategy, you know, we'll really flesh out like, okay, do we think you should launch with Amazon? only, or should we also do a retail launch? And we'll kind of put all that together and figure out, okay, what's the best case scenario to get the product out there and do a big launch and then plug in media and influencers, etc.? We have a great PR person on staff who, you know, helps—

Carla Nikitias.

Who helps like all of our founders and gives them some, a quick strategy. play in the beginning so that they at least have some concept, because typically these founders can't, you know, they just don't know how to do PR. And I think I learned that with my show, we would take PR pitches all the time. So I was one of the first people ever to interview Drew Houston from Dropbox and Julia Hartz from Eventbrite. And this is because they had PR people in the earliest days. getting them out there, plugging them into these opportunities. And now you look at those, both of those companies have gone public. And so I always think back to there where I just want them to have a light understanding of what PR does and what the opportunities are. So, so yeah, that's something we really try to hone in on.

Yeah. And it's interesting now, I mean, at this point in the show, for me, at least 3 years in or almost 3 years in, it's like I get a number of PR pitches every week from startups. And it is interesting how to see some of those have really blossomed and they've grown a lot. 100% because of my show, of course. But like they've grown, they've grown a lot from that experience. And actually, one of the things I'm thinking about now, which is maybe kind of strange, like, I'm thinking back to most of the pitches I've gotten from PR people. And I'd say 95% are from men, men, like male founders. I don't know why that is. I'm thinking of it right now. I don't know if this conversation is like bringing that up. But for whatever reason, most of them are from I'll send you some women. Yes, please do. That would be great. Because I'm just thinking like, it's been like outreach on my end to actually get other like diverse founders on the show. But most of it's like always male when it comes to the show, which is just interesting to think about. One thing with you as well, with the show you've done for so many years, obviously a while ago, and also being in venture, how do you kind of juggle all the relationships you have with all the different companies and the different things you're doing? Think about building relationships, ones that you aspirationally want to have versus like all the ones you already have. Like how do you even think about that? Or how's that go for you, Jesse?

Relationships are so hard, and as a VC, it's so important that you're always growing them. You're always meeting new people, and there's weeks where you know people will say things to me, and they'll be like, "Hey, I really enjoyed this like conversation where we were talking about sharing deals." Let's put that same meeting on the calendar every month and we'll share deals. And I'll write them a note and I'll just be like, I have 62 companies, I have 85 investors. If I did that with everyone, I don't know if I'd get anything done. With all due respect, feel free to call me if you want to talk about the deal. And it is, it's like the amount of, I mean, I have friends who pre-COVID would come over to a party and they'd say things to me like— to a party at my house with my kids or whatever. And they'd be like, how do you know all these people? And it's just like the business we're in. You connect with different kinds of interesting people all over and you're always connecting with new people and getting to know them in new ways. And I think— I mean, I love it. It's such an amazing thing that we get to— because we're constantly meeting people, We understand the world in a way where we get to talk to people who, you know, love all sorts of politics, and you get a little more of real life. I think talking to all of these different entrepreneurs from all these different places, building all these different companies, you know, I never claim to be an expert in one thing. I think you you learn a little about everything as a VC, but. I think in terms of juggling the relationships, it's tough. I reprioritize every day. I reprioritize every week and every month. And so I sit down with my assistant and I say, okay, these are the goals I have to get done this month. And then while I don't want to reschedule people daily, you've been rescheduled, so you understand. I do my best to keep all of my meetings, but occasionally that morning I'll realize, oh my God, I haven't gotten my annual report out, or, oh my God, I need to actually get this work done. And so then I kind of reprioritize, push some meetings, get the work done I need to get done. I mean, you can't meet everyone all the time, so I try to kind of focus on the key moves I need to make as a business leader. And then I always try to have a couple fun ones in there. And then I also, a lot of female entrepreneurs reach out to me. A lot of female investors are like, how did you raise a fund? And it was hard. So I want to help. So we actually recently came up with this idea of like, it sounds silly, but it's like favor day. And so I have one day a month that I just sort of like do all these really fun networking meetings where I'm meeting new people, where I'm talking to young girls, where I'm— and I love it. I actually really look forward to it. And so I think it's hard. You have to compartmentalize, but you also need to make sure you're not packing. Like yesterday, I had 10 hours straight through of Zoom and I felt chained to my desk. And while I need to do those days every once in a while, I think it's important also that you— Um, you know, make sure you're making time for the important things, because otherwise you're not doing anything well.

With that and thinking of kind of relationships and how we mentioned, you know, you're managing all these different relationships and everything is with the founders as well. Um, you're getting pitched all the time, people are reaching out all the time. And you mentioned, you know, have to prioritize and kind of think about that. And like, it's a matter of, you know, you're reacting a lot to things that come in, but also being proactive to other things. How are you evaluating founders today? Because You've been doing this for a number of years. You've just talked to so many founders for the last decade or so. I mean, with your show before, what are you looking for founders now? You're investing early stage. I'm curious, what are you looking for? How do you evaluate them?

I think I do have a good, a much better pattern recognition now where early on I was making a lot more mistakes. And when you do work in this industry, you have to invest in quite a few founders to find the successes. They're not all winners. And so you kind of get used to a company every once in a while going under. I say they're toast. That's sort of how we talk about it. And we do our best to evaluate now how to save those opportunities, but in advance. But I think the thing that I really stuck with in terms of this pattern recognition, and you need to see a lot of founders if you're just getting into this industry, you need to see a lot of founders. I mean, we see a new ice cream company every week. So if you saw your first ice cream company and you're about to invest, like, give me a call, I'll send you 25. You want to make sure that you see everything you possibly can in that industry. And you— the one thing that I just really stayed true with from the beginning was this idea of openness. or coachability, where the founders who were like, no, we're going to go this way, we're going to run into a wall, it's going to work, we're going straight up the mountain, nothing's going to get in our way. I'd say, okay, well, what if there was an international pandemic that shut you down and the manufacturers didn't work? And they would say things like, that's never going to happen. And I'd say, okay, well, what if it did happen though? And the ones who would roll with me, And say, okay, well, I think then we'd move our manufacturer more local and we would figure out another way to build this. And those were the founders I invested in, and those were the founders that I stuck with. And nothing has proved more true to that theory of investing than COVID because those founders figured it out. I'm not saying our e-commerce fashion companies turned into transportation companies, but things like that happened. You know, entire businesses were moved online and because Because these founders had Plan A, B, C, D, know that it's not a straight line up a mountain, they were ready. And when I was calling them, we had this huge, huge Zoom with as many founders as we could fit on a Zoom in the beginning of COVID It was 2 weeks in. And I just said, here's my recommendations, apply for the PPP loan. And I went through all of our recommendations. And I realized how ahead of me all of them were. And this is 2 weeks into COVID and they already, because early stage companies, they're seeing hits to revenue week 1, where you look at the public markets and after a quarter they're like, so this COVID thing, it's pretty serious.

Yeah. It's a thing, huh?

Yeah. So I think it's just, I love that idea of a founder Who's open, willing to roll with it? Because you and I both know it's not so simple. No one has all the answers, and you want the founder who's going to work with you to problem solve. And so that's something that I looked for before, and now I'm always looking for.

Yeah, yeah. And on that note, I know one of the founders you invested in, Toucan. So Taylor there, Toucan. And I know you had mentioned as well kind of. With COVID how edtech, future of work even, is really shifting and changing. And that's something we're going to be focusing on at Vitalize is investing only in future of work and future of learning moving forward. I'm curious for your perspective then, where do you see future of work, future of kind of learning going? And even kind of double-clicking on that, like why Toucan, for instance?

Toucan. Taylor's amazing. I mean, that whole team's amazing. But it was such a cool team and they all came from totally different backgrounds, totally different companies. And I was like, these are 3 founders who all have incredible experiences that are going to go into this company. And I think language is an enormous opportunity and an enormous market. And I love the idea we're all just browsing our computer screens all day long reading articles, why not learn another language while you're browsing? And then she has all these other fun ideas. Like, I like that you can own a word. And anyway, everyone needs to go play around with Toucan. But I thought she was so passionate. She was so— she's a force. Like, she just— she infects you with her positive energy. And that's the kind of founder you want, is one who is just so insanely optimistic that they're going to figure it out. They're going to make it work. You don't want to invest in the Negative Nancy because they're going to convince you not to. And like you guys, whoever goes and meets Taylor, they're going to see she's the most positive human on earth. And I think that's very attractive as a founder because you want people who are always seeing the best side. You don't want like We've invested in a few lawyers, and I love lawyers and I need lawyers and I have great lawyers, but they are in the business of assessing risk. So we just had a law firm come speak to our founders actually about SPACs, and I want my founders to consider doing SPACs. It's a great opportunity to go public a little earlier. There's a lot of cash there. I just wanted them to look at the opportunity. But when you have lawyers come talk about SPACs, they're like, so there's a lot of potential risk with going public via SPAC. And I'm like, I actually had to continuously cut in and say, please talk about the positives as well. Let's balance out. There are opportunities within SPACs, but you don't want that mentality necessarily. And there's great lawyers who do run companies, but You don't want that mentality when you're investing, I think, in a founder. And then to answer your future of work, yeah, this was an industry we were just digging into going into COVID. And the few investments we made in future of work obviously just took off. One of which was a screen sharing technology through the Squad app that then was quickly acquired by Twitter through COVID because The growth was just astronomical in this social network that Esther had created. And then we were both invested, it sounds like, in All Voices, which is an incredible future of work technology as well that started as a sexual assault reporting app. And now she's becoming the major player in any kind of anonymous communication. In corporations, which is so important right now, not only for sexual assault and harassment, but also for COVID, among a million other things. So, you know, you have those opportunities. And then we are doing— I like how you say, let's double-click on that. I like to double, triple, quadruple-click on childcare. It's so broken. And it's finally, you know, people are finally hearing this. Yeah. And it's over a $150 billion market. I think it's like over $200 billion market. And people are just starting to see the opportunity. And we had made a few investments in childcare that even with all of like Brella, for example, which is a childcare facility that started in Playa Vista, even with all the regulatory issues where it's like you can only have 25% capacity, etc., They're blowing up. They're growing so fast that they're launching quite a few new locations, and you're just seeing this opportunity. And I love the potential right now for childcare because it's so broken, and that's the best place to invest because that means there's so many potential solutions. So when you look like ten years down the road, you want. to invest in the potential solution that in 10 years will be the billion-dollar business. And so that's something that we are just quadruple-clicking on.

I love it. And it's funny you mentioned that because I'm in Playa Vista across the street from Brella. So I remember seeing that. I was like, what is this? But we didn't know what it was at first. And we start, obviously you see all the kids come in, you're like, ah, childcare, of course. And it's just like, yeah, it's packed every day. Like there's people always coming in there and like, that makes sense.

Yeah. And then there's, um, we're in WeCare, which is also, you know, childcare is also unaffordable. So we're looking for solutions that make it more affordable. And WeCare has 2,500 facilities across the country that are more affordable, um, in-home childcare. And they also work with the government and do government-subsidized childcare. And so we're looking for opportunities like that to, you know, solve this at a mass Love it.

And I know we're almost out of time here, Jesse. So where can people go to connect with you? What's the best way to get in touch with Halogen?

Well, we had a lot of chats about networking today. We are very accessible. I think access to capital is such an important thing and such a problem. So we're always trying to be accessible. You can find me on— I've taken pictures on Instagram @JesseCDraper, on Twitter @JesseDraper. I'm on LinkedIn, and then you can also just go to our website halogenvc.com, and we have a cold pitch application you can just fill out, and it goes straight to our inboxes. So we try to be very accessible. Sometimes it takes us a minute to get back to you, but we will.

I love it. Yeah, it does take a minute because there's a lot of pitches. I remember talking like Rick Smith from Crosscut. He's like, yeah, we're gonna get 5,000 plus people reach out to us. We're gonna look at 500 and invest in like 10 to 20. It's like Just give us a little time to get back to you, but we will. Um, but this has been so much fun, Jesse. Thank you so much for taking the time to come on the show today.

Thank you so much. This was a blast. I really appreciate it.