Moth Fund Founding Partner Molly Mielke on enabling exceptional individuals early | Ep65

It was a bit magical for me coming from a background in entertainment where the culture is extremely hierarchical and you are expected to spend at least 5 years being a PA, like running coffees, and then coming to tech where it's like, as an intern, I could be leading a project. And that's crazy. And they actually listened to me and like my opinion and intuition for better or worse. But I think that it definitely, for a while, until I had more like reps under my belt of projects I could point at and be like, hey, I did that actually. I'm not an imposter.

Hello everyone and welcome back to Seed to Harvest, a podcast hosted by me, Paige Finn Doherty. I'm the founding partner behind Genius Ventures and author of Seed to Harvest of the same name in this podcast, which is a children's book about venture. And on this podcast, I love exploring stories, tactics, and frameworks with investors and creators and founders. So I'm excited to have my dear Twitter friend Molly Milky. On today, Molly is the founding partner of Moth Fund. I'll let her go a bit into her intro, but welcome Molly. I'm excited to have you on.

I'm so happy to be here. My name is Molly and I'm the solo GP behind Moth Fund, which is a small pre-seed and seed venture fund that invests in exceptional people as early as possible across all sectors. And my background is a bit circuitous, but I explored entertainment and worked at a bunch of different tech companies and specialize in helping founders with storytelling.

I love that. I feel like that's something we definitely have in common. So I found an old blog post that you had written and you shared some of your favorite questions to ask people. And I wanted to ask you, the first one I was on that was, where were you when you had the idea for your current thing? So where were you when you had the idea for Moth Fund?

It's a great question. It's kind of, it took a while. Like, I feel like there was a lot of different evolutions of the idea. It started as being a project that was more focused on trying to accelerate innovation by investing in people via grants. And that was something that I did as kind of like a meta extension of getting a grant myself and then finding people that were doing weird, interesting work and giving them small checks. So that was kind of the first iteration. That was really just trying to be a source of kind of belief capital for these people as opposed to being more like actual capital fund thing. It's more just saying like, hey, your thing's really cool. I hope you continue to do it and count me in and my money is behind it. And then I did that for a while, while I was doing consulting and I became a Sequoia Scout through the consulting. And I realized that there was actually a lot of overlap between venture and the grantmaking.

Mm-hmm.

And oftentimes there was pretty clear paths between the two. So I think that that click, which was probably what the current iteration of Moth Fund is now, That came probably at like the end of 2022. I think I was in Miami and I was doing my consulting and I was talking to a lot of different people about what I wanted to do. And I had a couple conversations with friends that were just like, I think there's a lot of overlap here. What should I do? And they were like, you should try to raise a fund. So it was kind of more of like a bunch of aha moments of like, that might be it, right? But when I was looking at venture at the time, I didn't really see a lot of people doing it in a way that like I saw an immediate path to my starting Upad because I was like, this is, this is totally different. Like, they're marketing themselves as like a B2B SaaS fund or a crypto fund, and I'm not that. So it took a while. It was like a gradual growing, but I would say that the inciting incident was probably just like a lot of friend conversations, mostly dinners.

Okay, wait, there's so many points that I want to like dig out of that answer. I think one of the things I'd love to start with Is as you thought through, I think when we connected, so for context for our listeners, we connected when Molly posted this. I honestly laughed when I read it. It was this study from, I think, University of Virginia or something like that. And it talked about how STEM glorifies young genius like no other and how—

oh yeah.

Yeah. How scientists have this like interesting, I, I think like the term that came to mind for me was like calcification when you get recognition really early on, which happens quite often in tech. And then Mm-hmm. You're forced to work on great problems instead of small problems, which then became part of your thesis at Moth Fund, which I'll have you talk about. But I think that there is something beautiful in working in really small, constrained ideas. And I think that's a theme that's been threaded throughout your work online. So I'd love if you could talk a little bit more about the beauty of constraints, maybe.

I think that how I see it is that Young people in general really benefit from trying a lot of different things and actually getting just more data points on themselves and what they enjoy. And that's something that is much easier done if you are taking shots on goals that are easier to hit.

Yeah.

If you dedicate yourself very early on to huge problems that have basically never been solved, I think it's really hard to get the reps in that you need for your competence to grow into something that actually makes you confident in yourself and willing to take on larger challenges. And I think that's a trap that a lot of people fall into early in their careers. They're like, well, I need to be working on the most important problem, but the most important problem is unsolved probably for a reason.

Yeah.

And so it's probably easier actually for you to prove to yourself of what you can do on easier problems and just get a better self-understanding before you start thinking in the terms of like, do I want to dedicate myself to this problem for 10 years? And that's something I just learned more from firsthand experience of trying a bunch of different things myself. Usually though, it was like trying different roles in the context of companies and then realizing, oh, this thing that I idealized is actually not the right fit for me. But they were the same kind of like small-scale problems that gave me a lot of self-knowledge. And I think any environment that a young person can be in that gives them those opportunities to get those shots on goal is like actually going to be a much faster path to them finding the thing that they want to devote themselves to longer. So it's highly productive in the long term, even if it feels like you're wasting time and spinning your wheels in the short term.

That's super interesting. I feel like it also connects a little bit to, I want to touch on this later in the episode, but imposter syndrome, because you've written about how, I think we've chatted about this before, you had this great quote on criticism. I'll read it for our listeners for context, but you said, for better or worse, almost all my accomplishments have been made possible by self-hatred. It's hard to push past Mediocrity without sacrificing a certain degree of safety, and that's easiest done by pulling from your card catalog of reasons why you don't deserve the luxury of comfort. But relishing in self-hatred is a slippery slope towards self-destruction, whether that be from action or inaction. A side note, your writing is gorgeous. I love it.

Thank you.

It's so fun to read. Yeah, I guess I'm curious, like, can you explore how imposter syndrome or that, like, paranoia of wanting to be better or the best has shown up in your work and maybe like your relationship with that?

Yeah, I think I struggled for a really long time with just feeling like I was in environments that I had no business being in and people were taking me seriously when they shouldn't be. And I think that it was a bit magical for me coming from a background in entertainment where the culture is extremely hierarchical and you are expected to spend at least 5 years being a PA, like running coffees, and then coming to tech where it's like, as an intern, I could be leading a project. And that's crazy. And they actually listened to me and like my opinion and intuition for better or worse. But I think that it definitely, for a while, until I had more like reps under my belt of projects I could point at and be like, hey, I did that actually. I'm not an imposter. I really, you know, I would cry sometimes. I'd just be like, I'm not up for this. I don't know the right answer. I don't want to seem stupid, but I think that it just got better. Like, it's really just something you have to get through. I think that there was a certain point after I started doing the consulting where I was like, actually, like, I think I've proven it enough to myself that this is a skill that I can do. And it was more the, like, helping founders with storytelling-related projects and kind of figuring out the brand and, like, ways to attract top talent. And that just, it felt like there was a lot of people I could turn to too that could kind of reassure me. Yeah, yeah, definitely. That I had done it. But I think I also, after that, I got a bit more stagnant and I was like, that's actually just like not enough. Like this doesn't actually feel like a real competency. It feels like something that was actually more just handed to me because of my background and the relationships I've built. But it isn't like a really strong competency that I feel really proud of. And so I got hungry to like prove myself in larger ways, like take bigger risks. And that's actually what led me to like consider a bunch of different ideas of what I wanted to do. And of the ones I tried, being an investor was the one that was kind of a sleeper hit that I really, really enjoyed and kind of checked all the boxes for me. And it also, the process of fundraising has been incredible for my imposter syndrome, like absolutely amazing because I didn't realize it, but the single thing that I needed most was just like high volume rejection. Yeah.

High volume rejection does wonders.

You're like, yeah, it's amazing.

Like a bunch of people like don't line up or don't get it. Totally. Or yeah. What? Like, you're like, cool. And then every rejection after that just becomes like one on a stack of many, many, many, many, many, many, many.

And it really doesn't hurt. Like, no, you just realize it's a numbers game. Okay. It hurts sometimes. Yeah, a lot of reflections too on like, I think I went— when I was fundraising, I went to the people that I like kind of admired most first to hear, to ask them, and that was a huge mistake. I should have asked first the people that I actually just didn't care what they thought because then it would have hurt way less. It took me longer to fundraise because I didn't like prioritize well, and I took it to heart when people were like, no, you shouldn't do this, like Venture is not the right thing for a young person. And then I just had to prove to myself by doing it that I was like, actually, they're wrong. Even if I really respect them and they are amazing people and I'm lucky to have them in my corner, like, they were actually wrong and they don't have a vested interest in my long-term success. So yeah, they actually shouldn't have any say. So I got a little jaded, but I also think like that was really good to learn. Yeah.

Yeah. A little jade, you know, arguably can be good. It goes a long way. A little bit of spite. Just a tiny, just a little bit.

Highly motivating.

So tell me more about some of the areas that you're super excited about investing in or where have you been exploring recently?

So I made my first fund generalist by design because I really wanted to prove out, give myself a lot of freedom to see what the patterns emerge from my investing of like, what do I actually like to invest in beyond just being like, I'm a B2B SaaS fund or something like that. But proof is in the pudding. I usually like to invest in B2B SaaS. And those tables have turned. I know everyone could have predicted this too from like the companies I've worked at and consulted for. But I think that I'm much more interested in just amazing founders. And I do find that especially in the current market conditions, most of them are drawn to tackling problems that are a little bit more kind of In the area of B2B SaaS, it is like very clear how it's going to have a 10x return. But I think more specifically, I like vertical SaaS, I like fintech, I like future of work that is more kind of category creation angle as opposed to like incremental improvement, aka not notes apps. And I don't know, some other things too that are kind of— I like AI if it's more on the side of either aggressively vertical SaaS, basically augmented by AI, or if It's basically creating an entirely new category. Anything in the middle that's like infrastructure or just like a kind of a quick way to make it make money, I'm not interested in. So that's kind of what I'm currently looking at.

What are some of the most compelling trends that you've seen in those areas that you've spent time? Anything that's really guiding how you're thinking through them?

In vertical SaaS, I think I always just look for what are the sectors and industries that haven't been yet penetrated by software and haven't had the effect of been massively had the coordination communication increased by the benefits there. So that's pretty straightforward. In fintech, I'm very interested in specifically the trend of the huge, whatever it is, $68 trillion wealth transfer that's coming from boomers to millennials and Gen Z. Things that are basically reinventing fintech for a younger audience because there is a lot of more money movement there, and I think that new products could be built there. I'm not seeing a lot yet that is super compelling. I think that in future of work, again, yeah, I'm much more drawn to things that are much bigger swings at potentially either regrouping how we think about work or media, or being more kind of a vertical SaaS thing, or they're creating new paradigms of how we interface with computing. But anything that's just like, Yeah, a better Photoshop or something like that. I just don't see it. I think that this is a space that so many tech companies have been founded in that it's just, it's very oversaturated at this point, to be a bit glib. And then yeah, in AI, again, just more category creation or vertical SaaS basically.

Yeah, that's super interesting. I feel like I've spent a lot of time in vertical SaaS as well. I know it, like you said, I think it's, there can be this overwhelming narrative of things have been done before and things have risen to the point of such high-level abstraction, but I feel like that's happened in very concentrated areas and there's still a lot of industries that have not had that transformation, still very much pencil and paper. I'm curious what areas in verticalized SaaS are you looking at? Can you share?

I look at a lot. I am like a little biased because of my background in entertainment that I get a lot of deal flow there and I am excited about anything that is like vertical fast for entertainment. I also look at just, yeah, basically anything that has proof that they've been operating on like pen and paper, I'm interested in.

Yeah.

There's some that like right now I've been quite interested in the grantmaking space and more the foundation and nonprofit world if there's any opportunities. there because I think they are usually relying on either like very archaic enterprise software that doesn't really work or kind of hodgepodge methods at the smaller scales. And you have like a lot of context for that having—

actually, I'd be curious to like, can you walk us through a bit of like what your process of applying for a grant looked like? Because I feel like on this podcast I talk a lot about venture and that as a source of financing, but you know, to Venture is like a very small percentage of what actually ends up funding companies. So I'd be curious to understand from a first-person perspective what grant, what the grant system looks like.

It's weird right now. I think like I, so I got a grant from Immersed Ventures and it was what inspired me to quit my job and go out on my own basically. And that was amazing and it kind of kickstarted my thinking about how we fund more innovation. And I was very lucky that that was kind of— Tyler Cowen is the person who picks for Emergent Ventures. I got introduced to him and it was— the beauty of Emergent Ventures is it's an incredibly short streamlined process and he makes a decision very quickly. Most grants are not like that. Most of them are like very long time horizons. You have to like probably know the foundation already. And what's nice about that program too is they fund all kinds of like weird stuff that's usually like new institutions or people that are exploring ideas or they're just promising individuals that should be given more time and not just in a boring job. I think the more interesting work that's happening in grantmaking right now is more in science funding and stuff like that. A lot of institutions like Schmidt Futures with FROs and all these different kind of new models, as well as ARC Institute and Ben Reinhart's Speculative Technologies. These are just, they're trying to basically make progress faster in different interesting ways, usually within science, and oftentimes bypass the existing institutions. And I was kind of like part of that world while I was exploring grantmaking, but I never, I obviously didn't decide to double down on solving any part of it because I became much more interested in like the use case of me post-college as like somebody who knew that I wanted to start something, but I didn't know what, and I needed space to figure it out. And I, it wasn't as much a money thing as it was a confidence thing. Like I needed somebody to say, Yeah, you should do that. And for me, that was Tyler Cowen. I was very lucky in that way. But I very, from like talking to a lot of people and knowing all my friends, I knew that the amount of money could be scaled significantly down and it could mean probably just as much. So that was kind of like one of the inspiring events for Moth Fund to having a small grant program in addition to the venture is just realizing how short the gap is between a small grant and starting something that is potentially a company. And so I have a small grant program. I write like $5K checks that are no strings attached to people that are just exploring interesting work that may go on to found a company in the future, but more it's me betting on them. And I usually try to find them when they're in high school or college.

Yeah, that's super cool. I think when we first met, you were exploring the model. Can you talk a little bit about what that model looks like in practice or perhaps the graduation from Grant to a full check from the fund? I would love to hear more about that.

Yeah, it's a huge open question now because the fund's so new, but I think that it's something that for me feels like a long-term bet of if I find an amazing person and they are young and interesting and I see a glimmer in their eye that I want to shine a light on, I want to bring them in close and I want to have a method and apparatus to do so. And my grant program is that. So there's no I don't have any graduation stories yet, but I have a group of people that are awesome and I will bring to a retreat every year, probably indefinitely. And, and if they ever do start something, I would love to potentially fund it. There's no like actual contractual obligation on their side or mine, but it's more just like building the relationship and supporting them. And I think it's more just about the friendship and connections than anything else. And the grant is just like a nice byproduct. It's like an invitation to the community and kind of like— Yeah.

Yeah, what is— I guess like to get to like the more logistics of it, what is your— what does your process look like for, you know, you meet someone all the way up to, okay, now they have a grant, how do you think about supporting them?

Yeah, I mean, I think it's like highly bespoke. It's more just oftentimes like we text a lot, we have calls, they send me updates, that kind of thing. Yeah, I think that I'm very inspired by like early YC and the way that Jessica and Paul fostered a feeling of family. And obviously, like, I'm not in person with these people. They're all over the world, but I would love to support them in a way that makes them feel comfortable telling me anything. And I can just help them navigate the venture landscape if they care to do so, or even just the career landscape and like personal development as well. So it's more just kind of like, I'm here to help in any way, answer any questions, talk anytime. And I actually think that that at the earliest stages, is the most valuable thing you can do is just be a sounding board that feels safe. And I think especially since I'm not like a traditional investor in these people, it feels even safer because it's like, I gave you money without anything. Like, there's no obligation that you need to stick to any project or anything like that. I'm betting on you very explicitly. And that is like kind of the thesis behind Moth Funds. It's like, I'm just trying to bet on exceptional individuals, both with grants. Very early and with Venture Dollar for amazing founders. And I usually define my taste in people as being, they're kind of T-shaped. Usually they have a core competency that has instilled them with a certain confidence in themselves because they have been obsessed with something for a while and proven that they can get really good at it. But then I also fuse that with, I like people that have more of an unconventional background. So maybe a little bit more multidisciplinary, they come from an uncommon area. And so that creates some more like generalist T-shaped formation. And I like that specifically because I think that they are usually much more creative in their approach to solving whatever thing that they're tackling. I think creativity is usually just dot connecting old ideas from disparate places in unconventional ways. And so people that very clearly have that kind of background are highly compelling to me as founders, especially when they're trying to kind of like disrupt an industry or make it radically better. And then I also have kind of like a, I get very in the weeds on human, like it's kind of psychobabble, but like this, I think that market founder fit is a very real thing. And if someone is trying to create a new category or something dramatically different, they should have a bias more towards truth and just bringing this thing into existence over social cohesion. Versus if they're more a vertical SaaS founder, I do like people that are more social cohesion driven and they are better at building relationships and just kind of embedding themselves in an ecosystem. And they aren't going to be that, they're not going to have the same contrarian energy because that's actually not helpful in a lot of areas where it's more relationship driven as vertical SaaS often is.

That's super interesting. I like that delineation a lot. No, I love that. Okay, I have 2 more questions for you, but do you have any questions for me before I hop into those as we're wrapping up?

No, you're great. This is awesome.

Okay, cool. So my, my next one, or I guess I'll rephrase that as like, is there anything that you're curious to ask me? Like sometimes I'll ask like the folks that I interview if you, you have any questions like for me. Hmm.

That's a good question. Well, I'm more just curious about how you are and how things are going and all that kind of stuff. But I, I'm actually curious, maybe like a good question, what do you wish that you had known about venture at the early stages, like going into this? What are your reflections at the highest level?

I think one of the points that you brought up earlier was really interesting in terms of like, you'll get advice from people that you admire, and based on your context, it might not be the best advice. And I think this is especially interesting having invested over a handful of different trend cycles. I think when I was raising our first fund, there was more of like, oh yeah, we could invest in that space. Like, it's like, okay, like there are certain spaces that we're willing to explore and we'll make it a bigger part of the narrative, but like at the end of the day, like we'll make a handful of investments, but is that really a core aspect of our fund? And so I think there's this interesting delineation of now I'm going to be more, I would say, like disciplined and like we invest in the future of play and the future of work, and we're gonna have a couple investments that are just kind of Weird and out there, and that's the way I like to invest. And I'm not going to. I would say like AI is an interesting one. Like you mentioned AI and like applied companies. Like I'm not going to say like our whole fund is like pivoting that way. It's definitely an area and an undercurrent that we're exploring. But I think earlier on I would have been like, like it was more fluid. And I think that that was one of the things that I wish I had known a bit earlier on is just to trust my. gut instinct more and maybe incorporate less feedback? I would say there's definitely incredible pieces of feedback that I got early on. I think some of the most important ones were not benchmarking based on my age. I'm young, but I'm going to get older, and it's not a defensible thing to be young by definition. And so I think trying to build an investment thesis from the ground up based on first principles, that was like really helpful. But I think from a thesis perspective, I think you and I share this, is like because we have a different perspective, we're gonna see things that other people don't see and we might not have the language for that yet. And so I think that if I could go back, I would tell myself to like be patient because the language will arise. I feel like that happened with generative AI.

Yeah.

There was like 5 companies that we invested in that ended up being in generative AI, but there wasn't words or language for that really. when we made the investment. So I think, yeah, the language will arise. That's lovely.

I'll write about that. I really like that. That's a great reflection.

Thanks. Yeah, maybe I will. Okay, I have 2 more questions as we wrap up. What has most impacted your taste in ideas?

Ooh, that's a good one.

This I stole from you, by the way, if it sounds familiar.

I'm complimenting my own question. Let's see. I think that There was a few like market points. One of them was when I went to college, I went to NYU and I studied film first. And I, I actually, I, I liked my mandatory writing class way more than I liked my film classes.

Mm-hmm.

And they just had us write so many essays and it was basically just like liberal arts education on how to write really good argumentative essays that were expository about the world and media and human beings. And I had an amazing teacher, and I just became obsessed with it. And I think that all the readings that he exposed me to in that class have had a huge impact on my worldview. I think that my favorite book came out of that class, and it's a book called Ways of Seeing by John Berger.

Mm-hmm.

And it's just basically about, like, kind of the meta of, like, how we see ourselves in the world and the lenses through which we, we kind of view reality and how they can be shifted. And I found that very interesting. I think it's a theme that I explore a lot in my writing, and it's also kind of just like how I interact at a meta level with founders. I'm constantly just trying to understand like how they see the world and like create a mental model so that I can try to predict how they would deal with the inevitable things that might arise. And, and so I think that that definitely had a huge impact on my, on my taste and ideas, was just being in that class and being exposed to all these amazing authors and, and just writing a ton and realizing that it's just a repetition thing and you have to write all the time. And then I think another huge influence on my ideas was actually my first manager in tech when I worked at Figma. Her name is Bree Wolfson and she's wonderful and she started—

Wait, she was your first manager?

Yeah, I was so lucky.

That's so cool.

She's amazing. But she definitely, I think we came from kind of similar liberal artsy-ish backgrounds and had similar taste in books and aesthetics and all that kind of stuff. And she gave me a lot of recommendations that really kind of became tentpoles of my understanding of the tech world. And they were often like polygram essays and all that kind of stuff. But she also, you know, would throw in ones that were more kind of liberal artsy and stuff of that sort. And I think that kind of shaped my taste in what can, how ideas can be packaged within tech. And it helped me like have a consulting practice in the future and all that kind of stuff where I kind of specialized in that kind of thing where how do we make it, make a telebrand project or something of that sort compelling both at an intellectual level and also at a heart level. So it's like moving both heart and mind. So I think that those were the 2 ones, but I'm sure I'll have a couple more in the coming years. And I feel like they're, they're kind of like percolating in the background. Lots of the people that I work with now are really exceptional as well.

I love that. In other words, the tentpoles of your understanding are being built as you're learning. And the language, the language will arise.

The tentpoles. Yeah, precisely.

I love that. Okay, last question. Whose words echo for you?

I have been reading Anna Karenina recently, so Tolstoy. But also, I think—

Tolstoy echoing? I feel like he echoes himself.

Tolstoy echoes.

Respectfully.

He really does. He kind of echoes on the page.

Yeah, I was going to say, he says the same thing over, over, over, over, over. So I think it kind of has to echo for you.

Yeah, it kind of does. But I think more at a mentor level, I think there's been a lot of people that have really kind of echoed in my brain long after our conversations ended. I think that Daniel Gross is one. And then I think for like writing, I think definitely Bree, as well as I had a writing coach for a time and his name was Sasha and his words definitely continue to echo in my brain. And yeah, lots of other areas more like Friendships as well. There's certain people that I just think are exceptionally wise, but they're kind of quiet ghosts.

I love that. Well, Molly, thank you so much for joining us. I'll leave your socials down below so folks can follow you after, but I so enjoyed this. Thanks so much for coming on.

Me too. Super, super fun.

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 the strategies and tactics of seasoned institutional investors and rising venture stars, check out our YouTube channel at Seed to Harvest. Also my TikTok channel, Seed 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.