M13 Investing Partner Anna Barber on Lessons from Her Journey | Seed to Harvest Ep60

The thing that sparks joy for me, honestly, is being outdoors. When I was in my 20s, I almost dropped out of life. I did a 96-day National Outdoor Leadership School course in Wyoming and Utah. I spent 30 days sleeping in an igloo.

So cool.

And 60 days out in the desert. You know, we had food airdropped into us on a helicopter. I mean, we were really out there. And I gave some thought to not reentering the work world and going and being a rock climbing instructor or a camp counselor or something.

Welcome back. Welcome back to Seed to Harvest, a podcast with founders, creators, and investors about their stories, frameworks, and tactics, hosted by me, Paige Doherty. I'm the founding partner behind Genius Ventures and author of the children's book Seed to Harvest, and I'm really excited to have Anna Barber here today. Anna, can you please introduce yourself to the audience?

Hi Paige, so excited to be here with you today. Thanks so much for having me. I'm Anna Barber. I'm an investing partner at M13, which is an LA based Series A venture fund focused on investing in the future of consumer technology.

Amazing. Well, I'm excited to have you on as well. I wanna go a little bit back to the beginning. What was the first spark that really got you into venture? Can you share what it was?

Yeah, so we'll have to go way back. I was in tech a long time before I got into venture. I started my career in the mid-'90s working in corporate law and then strategy consulting. So I was at McKinsey as a strategy consultant. And then back in '99, everyone was leaving banking and consulting to go work at startups. And I really got the bug of entrepreneurship really more than venture. And so in 1999, I left McKinsey to go work at petstore.com, which was one of the early e-com players in there. I got to see our investors and get to know investors from the side of being an operator and, you know, looking at how our company was being capitalized. I didn't really yet had the bug cuz I was really pursuing my entrepreneurial bug. Yeah. And so that's really where it all started for me. And then I had a long journey as an entrepreneur, after which I got really interested in how do I help other entrepreneurs? Because I had, you know, taken a lot of hits as a founder myself and had made some kind of rookie mistakes as a CEO. And I thought, wow, how can I help other founders not make the same mistakes I did? And it seemed to me like investing in venture was a great way to help founders. Give them money and then also kind of help them on the journey of growing their companies and becoming like better versions of the, you know, leaders that they could be for, for their companies.

I love that. I feel like that's a very common path into venture is being a founder and being just like going through that process and then having empathy for the founders that you're backing now. As a previous founder yourself, I feel like that DNA never really goes away. So can you share some of the lessons that you try and impart on the founders that you work with? That you learned from your journey?

Yeah, absolutely. You're right. It doesn't go away. And I honestly feel like I'm still really in my founder journey because I think for me, the core of being a founder, being an entrepreneur is learning, is having a learning mindset. That's probably the main thing that I impart to my founders is just to have like an open perspective. So one of the things I say is strong opinions loosely held. You have to have a strong point of view as a founder. So you have to have a strong point of view about what your product is, who your customer is, how you're taking it to market, all of those things. But loosely held, meaning the market's gonna show you where you're wrong. Your customers are gonna tell you how you got it wrong. You're gonna be getting feedback all the time. And the best founders take that feedback and they incorporate it to change their own ideas and then develop a new point of view that's strongly held, and then they change it again. So you just keep doing that cycle over and over again. And I think that is really the core founder skill is the ability to hold a firm position. But also be very open to, you know, all the information that you're getting from the outside world.

Yeah. What's interesting, I think about it a lot, is kind of like the feedback sieve. Like you're getting all this feedback. How do you think about incorporating it into the business that you're willing into existence? I think like in alignment with that, I, I think that's an incredible skill for a founder to have.

Can you talk a bit about how to build a great founding team and what qualities to look for perhaps in a co-founder if you're a founder and you I think a lot of founders tend to look for people who are similar to themselves, and I think they actually need to look for people who are very different, who bring a really different skillset and approach to the table. To me, the core attributes of an early team are similar to those of a founder, flexible thinking, but you wanna surround yourself with people that have a really different skillset and knowledge base and may see the world differently because the more diversity of thought you can bring into that early team, the stronger your idea will be. are gonna be. So don't hire people who have a similar background and point of view and skillset that you do. Hire people that are very different and that may challenge your thinking.

I love that. And then from your standpoint as a venture capitalist, how would you say your investment philosophy has changed over the years?

That's an interesting question. So I've changed how I invest really significantly from when I started. 7 years ago investing at Techstars, because then I was doing pre-seed investing very early, very focused on the team, because at pre-seed you just don't have a lot of data or information about the product or, you know, whether there's product market fit or what the go-to-market strategy is. Really all you have is the team and the market and the idea. So I was really focused on looking for founder market fit and looking for teams that I felt like had the resilience, flexibility, learning mindset to You know, go all the way and find their way, even if it meant pivoting a lot. Now at Series A, the process is a little different. All of those things still looking for great founder market fit, looking for resilience and grit and a learning mindset. But in addition, looking for a massive market size, looking for some evidence of product market fit, looking for a repeatable go-to-market strategy. So a lot of what I do now, so I wouldn't say it's my thesis that's changed. It's really the approach because I'm investing at a different stage. That has also meant needing to become more focused. I was a generalist investor at Techstars. I invested in my first 2 years in everything from a satellite navigation company, Slingshot Aerospace, a great LA-based company in the space tech space, to a Sichuan chili hot sauce company, Fly By Jing, also an amazing LA-based company. So I had a really wide investment thesis. I've had to bring that in a little bit. At M13, we invest in infrastructure technologies for the future of consumer behavior. So I focus on commerce technology and the future of work, you know, exclusively. And there's been, that's been great in some ways because it's really allowed me to build more of an expertise in a, and not be a beginner every time I meet a new company. When I meet a new company now, I know who some of the competition is. I understand the market landscape because I've already been spending time in that space.

Yeah. In terms of like the market landscape of the companies that you look at, I'm curious to hear more about what some of the trends that you're keeping a close eye on are, or what you're focusing on.

Sure. Let's talk about commerce first. There's a couple areas in the commerce landscape that we're really interested in that I'm particularly interested in. One is the problem of unsold inventory. So really thinking about stuff that's manufactured that never finds its way to a consumer. Or post-consumer items that need to be resold. So I have a big thesis around unsold inventory, helping retailers and brands be more efficient in getting that unsold inventory into the hands of consumers. And then also thinking about circular commerce and how do we allow things to have multiple cycles through consumers' hands and find new owners when the first owner is done with that item? That's number one. Number 2 is B2B commerce. I think when you look at the evolution of commerce technology, Consumers have a wealth of technology that's helping them buy things. It's very sophisticated and not all B2B procurement has that level of technology. So I think there's some really great opportunities there. The third one is AI and how AI is influencing commerce. And I think there's some opportunities there around inventory planning. There's a ton of opportunities on the front side around how do we look at consumer data and acquiring customers more effectively and figuring out what people might wanna buy. You know, where AI can really play a role. And then the last one place that I'm really thinking a lot about and interested is kind of the disintermediation of retail. So what does it mean to be a retailer? So I could go on social media and say, I bought this jacket, I love it, do you want to buy it? And actually let you click and buy it right from my profile. I'm not a retailer, but I can sell you something from my profile. And I think There's some really interesting companies that are enabling individuals to become stores and curate their favorite products. That just changes the game for brands and allows them to reach customers who, you know, may be a good fit for their product, like more, you know, more effectively.

Yeah. I'm curious, can, are there any recent investments along those themes that you could share?

Yeah, sure. Recently invested in a company called Max Retail, which is a platform for selling unsold inventory. So exactly on that thesis, Max Retail connects small fashion retailers. So small stores that have unsold inventory bundles all that inventory up into a, into a product feed and then feeds it into distribution networks like Saks Off Fifth or Shop Premium Outlets, or, you know, even the resale outlets like Poshmark. So what it's doing is creating this really big source of inventory. for all the online outlets that is made up of a combination of tiny suppliers sort of all across the company country. So it's a really interesting two-sided marketplace that's helping solve that problem.

Well, that's super cool. Almost like a, yeah, an API for that sort of thing. That's super cool.

Yeah, it is. There's a lot of technology under the hood. It's a very hard problem to solve, which is one of the things I, I, I love about it. I'm really drawn to things that are operationally complex as a moat. And so another example there is WeCare. WeCare is a B2B corporate benefits solution for childcare benefits that is delivered through a marketplace network of in-home childcare providers. So one of their clients is JCPenney. So JCPenney offers a childcare benefit for all of its employees, and those employees can sign up for childcare through the WeCare network, which is 60,000 providers, most of whom are operating daycares out of their home. So what I love about this business so much is helping employers with a really affordable childcare solution, helping employees, most of whom are women, by the way, you know, find affordable childcare, and then helping these in-home childcare providers who honestly are also mostly women and are entrepreneurs, helping them kind of build their book of business. So when you think about all of the societal benefits and individual benefits that are baked into that business, it's pretty exciting from an impact perspective. And then also it's just childcare is kind of at an inflection point where all of a sudden companies have realized that they need to provide it as a benefit. It's kind of gone from a nice to have to a need to have for employers. And so that's a nice place for WeCare to be playing right now.

That's super cool. Well, thank you for sharing some examples from your portfolio. It's always, I can tell like how much you light up when you talk about it. So it's clear that it's super exciting for you. And on that note, I'd be curious, like, whether this is like in your role or just like in your life, what is sparking joy for you?

Well, the thing that sparks joy for me honestly is being outdoors. When I was in my 20s, I almost dropped out of life. I did a 96-day National Outdoor Leadership School course in Wyoming and Utah. I spent 30 days sleeping in an igloo.

So cool.

60 days out in the desert. You know, we had food airdropped into us on a helicopter. I mean, we were really out there. And I gave some thought to not reentering the work world and going and being a rock climbing instructor or a camp counselor or something. So obviously I didn't take that path, but you know, what really brings me joy is just being outdoors, being out on the trail, especially now. It's so beautiful, you know, post-rain California.

It's so lush. It's so pretty. Cool.

Super bloom has been amazing. So I just get outside as much as possible. It really changes my mood.

I love that. Okay. Another fun fact that I discovered when I was doing research for this podcast is that you produced 2 feature films and you co-founded the US Air Guitar Championships. So can you talk a little bit more about that?

That was in my Hollywood phase. Yeah. So I spent 6 years in the middle of my career as a talent manager. I represented writers and directors for television and film. And during that period, as you said, I produced 2 movies, which was a tremendous amount of fun. And I had the opportunity to co-found the US Air Guitar Championships, which are still going on today. So you can sign up and compete if you want, and then have a chance to go to the World Air Guitar Championships, which are held in Oulu, Finland every year for the past— Wait, have you competed? That's a great question. I have played air guitar on stage one time. It was at South by Southwest in 2006 when we premiered our film Air Guitar Nation. And the other fun fact about that is that I was 6 months pregnant at the time, and it is the only time I've ever played air guitar publicly, and there's no video. So I'm sorry, but there is no public record.

Oh man, that's so cool. Well, I feel like you've had such a, like, a wide reach in your career. career, and there's so many like alternative paths that you could have taken. I'm curious, like in your, in your journey today, who are some of the influences that shape who you are as an investor and a leader? They can be like authors or investors that you work with, or pretty broad.

Yeah, I think I'm gonna say one person who's really influenced me is Jerry Colonna, who's a coach who coaches VCs and was a former VC, and he's been really influential for me about thinking about the human side of investing and also helping me bring together my identity as a, like a coach and a mentor and a former founder with my identity as an investor. But I also wanna say the partners I have now, the people that I work with, you know, I think are some of my best teachers. All of my partners have themselves had like 20-year careers. So that's really amazing for me because they all bring such different experience to the table. Like my partner, Carl Almar, who's the managing partner of the fund, he, he was the COO of DigitalOcean and grew DigitalOcean from when it was a tiny startup to, you know, ready to go public. And then before that, you know, he had founded 2 other companies. And so just like having someone around who has that much experience of having grown a team and managed a large team, it's pretty inspiring. And then Carter and Courtney, who founded M13, you know, had their own founder journey and then decided to launch M13 as kind of their next venture after they exited their company Veve. And it's pretty cool to have all of these people who all could be doing so many different things, like all committed to building this firm together. You know, as a team. And so, and I think the fact that everyone together is also like aware of and appreciative of the talent of everyone else at the table makes it an incredibly special place to work.

I love that.

Right? Where like I show up knowing that like everyone like values all my stuff that I bring, including the air guitar and the sleeping in an igloo. Right. And then, and then like every person that I'm sitting with is sort of equally eclectic and interesting in terms of what they bring to the table. So that's pretty cool. Yeah.

And, and one point that you mentioned earlier was the human aspect of relationships in venture and tech. I, I would love to hear more about how you think about founders nurturing relationships with their investing team. What are some of the lessons that you've learned both on the founder and the investor side there?

I very consciously show up as an investor committed to saying the hard truths, but doing it from a place of, I don't wanna say love, that sounds corny, but doing it from a place of kind of ultimate commitment. So I have earned the right to tell my founders hard things. Because they know that I do it from a position of supporting them 100%. And if I'm ever not saying the truth or I'm kind of hiding the ball on something, cuz I think they don't wanna hear it or it's not gonna land well, or I don't wanna have a tough conversation, then I'm not doing my job. So, so that is kind of what I bring to the table. And then I want the same from them. You know, I want transparency. I want bad news. I wanna be the first phone. Great. Make me the first phone call when you have good news. That's always fun. But I really wanna be the first phone call when you have bad news. And I want to know that my founders feel totally comfortable calling me up when something bad happens and knowing that my attitude is gonna be to problem solve and talk about how we're gonna get through it as opposed to, you know, having an emotional reaction or, you know, being. You know, upset or angry about it.

Yeah.

Right. I really wanna be that solution partner.

What are, I'm, I'm curious. I've been thinking about this a lot recently cuz I feel like I've had a couple moments, like I feel I just hosted my first annual meeting at Buying Genius and that felt very surreal, like almost like, oh, whoa, this is like, this is real. Can you talk about some of the surreal moments that you've had over your career?

Yeah. Surreal moments. So I guess what you mean is sort of where you're standing outside looking at yourself going like, is this really happening?

Yeah.

Right?

Yeah.

Yeah. I mean, I think that moment on stage at South by Southwest was definitely one of them. I was there as a producer of a movie that was premiering and I was playing air guitar live on stage and I was just like, this is, this is an out-of-body experience.

Yeah.

Oh, that was crazy. I think another one was earlier in my career when I flew with my PetStore.com team to meet our investors. investment bank to prepare for our IPO for our company. I mean, I was a very young executive at a tech company and we were getting ready to go public and I was going into this fancy chrome office building to talk about our IPO and I just thought, you know, how did I get here?

That's awesome.

And yeah, so there've been lots of moments like that. You know, the first time I took this stage at Techstars LA for our demo day, you know, and this massive audience of the LA tech community had assembled and I thought, wow, like I'm creating this amazing community. We're building this Techstars LA community here, you know, and that's, that's something that I've been really instrumental in doing. That was another like great moment. So yeah, it happens a lot. And I think the fact that you asked that question is so great because I think it shows that you recognize when you're in one of those moments, which is so hard to do. But if you can do that and capture that and go, oh wow, look where I am. This is pretty exciting. You know, that just makes it more impactful.

Yeah. Um, yeah, I think that's definitely the strongest that I felt that way. I had an interesting, like, I came into the pandemic a college student and I left a fund manager and a lot of my work I do online. And so to have like 30 people fly into San Diego to meet each other and have founders present, I was like, whoa. Oh, this is crazy. I kept having like déjà vu the whole day. I was like, I, I've like dreamed of this moment before and it was so much better than I dreamed of. So.

So did you have your annual meeting live or was it— Yeah, I had it live on Zoom last Friday, which was pretty crazy.

I had it at an arts and music library that's like right around the corner from my office. And then I left like the whole afternoon unstructured, which was fabulous cuz like the founders got to connect with each other. We invest in like a lot of complementary So we all took a beach walk and I was just like, this is a San Diego annual meeting. Like, this is not gonna be like over-programmed or anything like that. I want everyone to hang out and enjoy each other's company and talk about the exciting and challenging parts of running a company. So yeah, it was really cool.

It's pretty amazing.

Yeah.

I feel like you're a venture superhero. I came into the pandemic a college student and I exited A GP.

Yeah. Yeah. It's, it's funny. I mean, I feel like I still feel some, so like in some moments I still feel like I'm, I don't know, I'm just like continuously learning. So it's exciting. I guess as we wrap up our conversation, do you have any questions for me? I've been asking my guests this more often, but I think it's always interesting.

I would love to hear what you're thinking about and what you're in, what you're investing in right now or what you're interested in. Yeah.

I feel like my First, my quarter before this was a little slower, and then this quarter I just committed to 2 new deals, one in the commodity space and then another in the sports space. When I think about the future of work, I'd say like I'm usually one of the only investors under 30 and definitely under 25 on cap tables that I'm on. But I don't just invest in like that, that bleeding edge Gen Z demographic change. I think a lot about how work is changing like across the globe, and I think especially that's true. In the commodity space. So the company that we invested in there is like a field data system. So right now a lot of natural resource companies are run basically on like pen and paper. And I think that it's very common for people to get caught up in hype cycles about things that are changing rapidly and forget that that's not the reality of like a lot of the world. I think there's like a lot of opportunities in industries that are less sexy, like automotive or natural resources or areas that have just like traditionally been less invested in. And then the second one in the sports world I'm really excited about, it's a company called Break Sports. And I met the COO who just joined. She invested in my first syndicate, which was very full circle. So I met her 3 years ago. We've kind of grown up in venture together and it's really interesting, like Sports, it's a court booking platform. And so they leverage corporate partnerships to pay for court space for consumers as a health benefit. And then they like allow the landowners to use that data to, for example, like build more pickleball courts if their tennis courts aren't all being used. And pickleball is like one of the the most rapidly growing sports in the US right now. So I think that like in my investment thesis, I think a lot about like the future of work and the future of play. So especially given the loneliness epidemic and how much time we've spent inside for the past 3 years, it's like, how do we recapture that sense of play and what is the infrastructure that allows us to do so? So those are 2 of the companies I'm excited about.

Yeah, I think that's really interesting. I mean, I love that you're thinking about sort of what I call like the big boring sort of like technology thesis because there are a lot of massive industries that are just under-resourced in terms of software to run their industries.

Yeah.

And it's just not something that usually attracts a younger investor. So I think it's really refreshing to hear that you're interested in that sector. And I love your story about the sports one because I think if you look what's happening in the market, so the in-home exercise segment, you know, has really plummeted, right? Has just really suffered post-pandemic. So where is all that activity going? This is kind of, you've sort of invested in the opposite of that, which is bringing people together to do activities and bringing them together outdoors instead of exercising at home alone, exercising outdoors as a group.

I was going to say, we actually invested in a couple of companies like in the, in the wellness space. So one that's at home is Aviron, which is like a game-based rowing machine, but I think their real pull Is that they have like a really strong community around gaming. So instead of feeling like you're using a rowing machine, like you feel like you're playing a video game and rowing is just the, the like modal of activity that you use to play the game. They have a Facebook group that is so engaged that someone got a tattoo, and I think we included the, a picture of the tattoo in our investment memo.

Probably the only tattoo to ever appear in any investment memo.

Yeah. Yeah. I, it was, it was pretty awesome. So they've been doing Really well. But yeah, I think a lot about like connection and it can be like in-home and out of home cuz it's like, you know, diff— different people like different things. But I do think that there's definitely a really strong pull to like recreational sports right now. So yeah, that's what I'm excited about.

I agree. Cool.

Well, Anna, I so appreciate having you on today. This was so fun to get to chat and hear more about Your fun facts and your investment philosophy and what sparks joy for you. Where can people find you on the internet if they want to learn more about you or reach out to you?

I am on Twitter and LinkedIn, Anna W. Barber. Don't forget the W. Happy to connect with your audience, and I'm very happy to learn more about you and your fund and what you're thinking about and investing in. So thanks so much for having me.

Yeah, absolutely. Special thank you to producer Riley Jennings and podcast editor Tate Doherty for your help on this episode. If you're listening and you'd like to connect with me, follow me on Twitter or LinkedIn, Paige Finn with 3 N's. Thanks again for listening, I really appreciate it. You can look out for new episodes every Monday at 5 PM PST, and if you'd like to learn more about those strategies and tactics of seasoned institutional investors and rising venture stars, check out our YouTube channel at Seed to Harvest. Also, my TikTok channel is Seed to Harvest, where I post a lot of behind the scenes. Um, and if you like this episode, please rate and review this podcast wherever you get your podcasts, if that's on Apple or Spotify. Anyways, thank you so much for listening. I hope you have an awesome rest of your day.