Founder-driven. That the owners are all in and totally committed to the business and have skin in the game.
As part of our series about “5 Things I Need To See Before Making A VC Investment”, I had the pleasure of interviewing Alex Pomeroy, co-founder and partner at AGO Partners and a founding investor in Aspiration, one of the first financial institutions focused on socially responsible cash management and investment. Following in the footsteps of his great-grandfather, who built the Golden Gate Bridge, Alex invests and builds companies that fundamentally improve our way of life. Before founding AGO Partners, Alex began his career working in private equity.
He is a graduate of the University of Southern California, where he earned his bachelor’s degree in international relations, and a member of the Young Leaders at the Milken Institute.
Thank you so much for joining us in this interview series! Before we dig in, our readers would like to get to know you a bit. Can you please share with us the “backstory” behind what brought you to this specific career path?
When I graduated from the University of Southern California in 2010, I knew that I wanted to pursue a career in business finance, though I wasn’t sure which sector. Through a mutual friend, I was fortunate to have met my business partner, Joe Sanberg and together we created our first VC fund in 2012.
Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
A book that particularly resonated with me was Dr. Doolittle. I have always loved wildlife and when I was young I would spend hours at our local zoo. I was touched by Doolittle’s relationship with animals and his ability to “speak” to them opened up a totally new mindset for me. I thought it was fascinating that he was more at ease with animals, than with humans. I am dedicated to cheetah conservation, and I also believe, as Doolittle, in the ability to communicate with animals. I have developed amazing long-term relationships with cheetahs in the African bush.
Do you have a favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life or your work?
I don’t have a favorite quote per se, but rather a motivating word: perseverance. Perseverance has always been a driving force in all aspects of my life, and most especially in my business career. Life can knock you down and beg you to fail, but you have to get up and fight to find a solution. You have to believe in yourself and totally commit. It is through perseverance that hard earned success comes with a true sense of accomplishment.
How do you define “Leadership”? Can you explain what you mean or give an example?
My definition of leadership is the ability to inspire those around you to pursue a common goal and create a team mentality. Communication and listening skills are key to good leadership. True leaders inspire an allegiance and loyalty that transcends all. Great leaders allow others to grow and assume more responsibility, so that they in turn can become future leaders. A leader needs a vision and a clear path of where he or she is going. If not, how can one lead others down a path that they themselves can’t visualize?
How have you used your success to bring goodness to the world?
As a founding investor in Aspiration, one of the first financial institutions focused on socially responsible cash management and investment, I have been involved in an initiative that is really making an impact. Through Aspiration we are influencing positive environmental change through our “Plant Your Change” project. By rounding up purchases on our debit and credit cards, we have now planted over three million trees in Africa. We are making a measurable impact on the environment with our carbon offsets. Aspiration customers are committed to social and environmental programs that will do good.
I also personally contribute to my own conservation interests in South Africa including cheetah research and support of black rhino anti-poaching units. Investing in Africa’s wildlife is something I have committed myself to for the rest of my life, and hopefully as I become more successful, I will be able to do even more.
Ok, thank you for that. Let’s now jump to the main part of our discussion. The United States is currently facing a very important self-reckoning about race, diversity, equality and inclusion. This is of course a huge topic. But briefly, can you share a few things that need to be done on a broader societal level to expand VC opportunities for women, minorities, and people of color?
It’s important that innovation capital be available to everyone. For too long, barriers have existed that have prevented entrepreneurs’ access to Silicon Valley. The more steps we can take to democratize access to capital away from a small number of decision makers, the better off our society will be. Specific examples of those steps include crowdfunding, the emergence of SPACs as a more democratic entry point to the capital markets, Reg A and A+ offerings and proactive incentives like opportunity zones. These will allow the movement of capital to those who have previously lacked accessibility.
Can you share a story with us about your most successful Angel or VC investment? What was its lesson?
Aspiration is our most successful investment. Through our automated socially driven software we are able to bring services and products to customers that reflect their values. In the banking sector, customers don’t know how their money is being used. Deposits with Aspiration will never be invested in fossil fuels, prisons or the gun industry. We provide Aspiration customers with the knowledge that their money reflects their personal values. Most Aspiration customers care about the environment but didn’t previously have a platform or the ability to contribute and inspire actual change. Aspiration software satisfies a latent desire to effect positive change.
Can you share a story of an Angel or VC funding failure of yours? What was its lesson?
The over emphasis on highest valuations and miscalculating the tremendous amount of capital needed to succeed.
I think that it is better for a company to grow slowly and more organically. I believe this is a better path to raising capital. In Silicon Valley there is a type of herd mentality to invest in the newest and sexiest ventures without sufficient understanding of the company’s structure and long-term goals. In sum, too much focus on valuation and growth and not on a path to profitability. Having the right investors and not be price focused is key.
Can you share a story with us about a problem that one of your portfolio companies encountered and how you helped to correct the problem? We’d love to hear the details and what its lesson was.
Capital Formation. Fast growing start-ups need capital to fuel their growth. Not every entrepreneur is a natural fundraiser. I have come in to help management teams with capital raising and created strategies internally to help them meet their capital goals.
Is there a company that you turned down, but now regret? Can you share the story? What lesson did you learn from that story?
I have never really turned down an investment that I now regret. However, I do regret not being able to move fast enough or have the capital necessary at certain flash points to be able to invest in every great opportunity. Space X in 2012 would have been an incredible investment, but timing didn’t work in our favor and we missed that opportunity. I have learned that timing is everything, and I need to be more nimble and opportunistic in the future.
Super. Here is the main question of this interview. What are your “5 things I need to see before making a VC investment” and why. Please share a story or example for each.
1) Founder-driven. That the owners are all in and totally committed to the business and have skin in the game.
2) The business has to have a big enough addressable market.
3) That the company is creating a real and lasting impact.
4) Longevity of brand and not just a fad.
5) Team. The potential to scale the team and company culture.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)
I think that is definitely the movement that Aspiration has created. The idea of do well, do good. Our actionable environmental projects in reforestation and the reduction of carbon in the environment are being felt. This action is helping the global population.
We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this.
I would like to meet with Charlie Munger. He has invested alongside Warren Buffet and has a pretty unmatched rate of investment success over more than fifty years. I would be fascinated to learn about his investment strategy and most particularly learn about the investments that didn’t work out. Was there a common thread as to why the businesses weren’t successful? I think you can learn to pick the winners by analyzing what caused others to fail. I’ve always had a great interest in history and I think it would be amazing to learn from one of the most successful investors of the mid 20th century who has lived over ninety years and has lived through so many business cycles. He would offer a unique perspective!
This was really meaningful! Thank you so much for your time.
About The Interviewer: Orlando Zayas is the CEO of Katapult, an award-winning omnichannel payment platform. Zayas is known for his revenue growth strategies and visionary leadership in the eCommerce and retail space. His future-forward expertise has led companies such as GE Capital, Safe-Guard Products International, and DRB Capital. Zayas is also highly committed to providing educational opportunities to underprivileged communities through his philanthropic endeavors. Zayas’ business insights are regularly featured in publications such as Forbes, Entrepreneur Magazine, Retail Insights, and more.