Lessons Learned from Hayley Barna, Birchbox Co-Founder Turned Venture Capitalist
At Dorm Room Fund, student partners have the unique opportunity to learn from leading entrepreneurs and venture capitalists through unscripted AMA sessions. A few weeks ago, we heard from Hayley Barna, co-founder and former co-CEO of Birchbox, now First Round Capital’s newest venture partner. After making some angel investments during her time off, she’s now investing with a world-class team as its first female partner. Here are some of the major takeaways from Hayley’s Q&A.
1. On starting Birchbox
Even though Hayley entered Harvard Business School without the intent of starting a business, she dove right into building Birchbox once she knew that she had the idea and the necessary life experience. The worst thing that could have happened to her was walking away having learned an immense amount.
Takeaway: If you’re going to start a company, don’t keep waiting around for the “right time.” You have to be willing to jump in and have conviction in both your idea and in your ability to execute.
2. On pitching Birchbox as a non-traditional tech company
Birchbox doesn’t fit the mold of a traditional venture-backed technology startup. So when pitching investors, Hayley emphasized three points. First, beauty is a huge market. Second, through a strong, dedicated online community, particularly with respect to engagement on YouTube, Birchbox has the potential to scale at an incredible rate. Customers loved the product and went out of their way to evangelize it, a theme common at successful companies. Third, the larger Birchbox grows, the more personalized each box becomes. Its potential for strong network effects reminded investors of the networks effects a traditional technology company sees.
Takeaway: Venture capitalists aren’t just investing in typical tech companies anymore. In fact, the sectors that are most underserved by technology are the ones that are ripest for disruption (and uncapped upside).
3. On raising capital
At the time of fundraising, Birchbox was already more than just a transactional e-commerce database. It had built up a vibrant community and an incredible amount of meaningful content. Hayley knew that a potential investor at First Round, Phin Barnes, was interested in content and commerce. So she went to Phin, piqued his interest, and eventually secured an investment.
Takeaway: Know what your investors are looking for and impress them. Do your homework so you can engage deeply with people you’re raising from.
4. On hiring
Birchbox’s first hire was one of Hayley and Katia’s roommates, who was a beauty editor at the time. She crafted an amazing brand voice and identity, built close relationships with customers, and set the tone for the company early on. When hiring later employees, Birchbox looks for those who are data-driven but creative, motivated by the company’s mission, and relentlessly enthusiastic about the product.
Takeaway: Hire those who are in love with the product and have a deep-rooted trust in the founders.
5. On what makes a good founder
Hayley looks for founders with a track record of creating things. If someone is breaking things and solving problems in 7th grade, then that bodes well for a future career in entrepreneurship. She leans towards founders who have a real backstory and an intense motivation to take risks and work hard, particularly if they are applying an expertise or framework of thinking in one industry to an entirely different industry.
Takeaway: Good founders are authentic in intent, are relentless in chasing a burning passion, and bring a unique perspective to the problem they are solving.
Thank you Hayley for taking the time to speak with us!