In honor of Black History Month, BLCK VC is launching a series of articles highlighting some of the amazing Black talent in Venture Capital (VC) today. For our second spotlight, we spoke with Mike Asem, a General Partner at M25 in Chicago, Illinois. M25 is an early-stage fund focused on investing in startups headquartered in the Midwest.
So, let’s start from the beginning, before entering venture capital where were you working? Can you share some key experiences?
When I was in college at Purdue University in Indiana, I knew I wanted to do something in the business world. I grew interested in how companies like Apple could build such deep loyalty with their customers. I’ve always been fascinated by human behavior, and wanted to study and share insights on how business leaders could understand human behavior and use this understanding to build their enterprises. This interest led me to major in Public Relations and Rhetorical Advocacy. I took graduate classes in sports rhetoric, and initially thought I would be a sports agent at some point, given there is so much value created through sports.
What motivated you to get into investing, and what is your superpower?
When I was a student, I was really interested in tech: I taught myself how to code, competed in hackathons, and generally knew I wanted to be conversant in technology. I started a nonprofit called The Anvil at Purdue. When I left, it was the largest student-run co-working space and incubator in the country, and it continues to thrive today. The Anvil has launched multiple Y-Combinator startups, and has produced a number of startups that raised have millions of dollars in venture capital. Through building The Anvil, I gained credibility in Indiana, which allowed me to go on to work at Chicago Ventures as a Fellow. Next, I was the first employee at a venture-backed startup, and then ended up at Purdue Foundry as a Director, where I helped to develop strategy and raise capital. It was there that I met Victor (Founder & Managing Partner of M25), who was just starting the firm at the time. We got to know one another, and just under a year later, I joined him as a Partner. We focus on pre-seed and seed companies in the Midwest, and have a strong belief that companies can be built anywhere. We are a boots-on-the-ground fund.
My superpowers lie in strategic problem-solving, building strong relationships, and blocking and tackling for founders. Victor and I collaborate on all major decisions and investments, but he spends more time on firm management, whereas I spend the majority of my time with entrepreneurs.
How do you think the VC landscape is changing? Do you think Black Lives Matter, and similar movements, will have a lasting impact on the industry?
There have been general changes in the VC industry. Even just in the past five years we’ve seen more interest in doing deals outside of the traditional geographies, and exits like Duo Security in Ann Arbor, ExactTarget in Indianapolis, and CoverMyMeds in Columbus reinforce the importance of these geographies. The COVID-induced shift to Zoom and video calls has created a frenetic pace in the industry. It feels as if we are vibrating all the time. Founders have a more level playing field, and this is absolutely a good thing. They have greater access to VCs, and if VCs don’t move with conviction, they will lose out on deals. VCs looking to win are being challenged more than ever to be aggressive and to consider investments outside of their core geographies.
On the Black Lives Matter front, I do have hesitant optimism that we’re on the front end of some meaningful change. I wrote Racism Won’t Die in 2020 in June, calling out the hopelessness and tiredness that comes from witnessing diversity theater among other things. While I do think much of what we’ve seen since the murder of George Floyd is in fact diversity theater, I have been encouraged by responses to that piece and others since — from unexpected allies to people adding value in ways they may never be recognized for.
What is your life or work hack that everyone should try?
I was advised by an amazing mentor early in life to never take a job for compensation, and to look at life like a portfolio of time. In the same way you invest your financial resources over time, conventional wisdom suggests you should take larger risks when you are younger, and you should decrease your risk exposure as you near retirement. The same strategy can be applied to careers and the way you spend your time. For example, if after college you have a choice between a boring job where you make $80,000 and an intriguing job where you make $40,000, but could get to your north star in life faster — you should take the latter job.
I have eight categories in life that I want to do well in, and track how I’m doing in each at least annually. I challenge myself to make decisions that improve the standing of each of these eight areas as my end goal is not about material accumulation but rather life fulfillment and authentic happiness.
One of BLCK VC’s events during Black History Month is called Black Wealth Matters, it will dive into the history of Black Wall Street and the Tulsa Race Massacre (exactly 100 years ago this year), and share additional history of the Black tech entrepreneurship and venture more broadly. Do you have any thoughts on how we can improve focus on building black wealth?
Understanding that VC has been historically non-diverse — unless you are building a new firm, odds are that the carry and wealth-generation economics of VC are largely allocated to non-minorities. We can begin solving this issue with diverse fund managers and with LPs willing to back them early and often. Partners and GPs at firms could thoughtfully make room in their economics for rising stars in VC to participate. From a global lens, the fact is all of us with the privilege of being in VC are going to do quite well. If more of us can make authentic decisions about what is truly valuable, and leave a legacy of access creation and meritocracy, maybe these efforts will eventually make space for those who deserve a shot.
Wealth creation should happen on the founder side too. Generally what I’ve seen is the less popular your market is, the more difficult it will be for a founder to secure good economics when fundraising. In the Midwest, there has been limited access to capital historically, and often, founders find themselves raising a Series B, and only own a tiny fraction of the company they built because they are presented with poor deal terms. The same has been true for diverse founders looking to raise faced with the uphill battle of implicit bias. If we can solve for that — we can do something special.
Lastly, we are all talking about Gamestop right now, but what people are really upset about is the lack of uniform access to wealth-creating opportunities. Information asymmetry and access asymmetry at scale are some of the biggest problems I believe our generation can look to solve to create a better, more equitable world.
