Nina Achadjian Shares Insights on VC Healthtech Investment
At Call9, we are fortunate to have many talented people as investors, advisors and partners. As a way of sharing their knowledge and expertise with our team, we’ve started hosting “Fireside Chats” when they visit our Brooklyn HQ. Recently, we welcomed Nina Achadjian, Principal at Index Ventures and Call9 Board Observer. Here’s an edited version of her conversation with Tim Peck.
What is Index? Why did you join Index just over a year ago?
Index is venture firm based out of San Francisco and London. We were one of the first venture capital funds to be founded in Europe, and expanded to San Francisco about seven years ago. We have always had the view that entrepreneurship is global, and hustle is universal, which has led us to invest in companies in over 24 countries. We currently invest out of a $650 million venture fund, which focuses on early stage companies and a $1B growth fund. In terms of sectors and themes, we invest in consumer, fintech, enterprise and infrastructure technologies, in addition to digital health.
I joined Index about a year ago and am part of the San Francisco team. I’m originally Armenian and started my career as a high-yield bond trader in New York and London. I loved having to form conviction, take risks and make decisions on very little information. After trading, I worked at Google on the AdSense team in an FP&A function. Google served as a great north star for how a successful tech company operates at scale. After Google, I founded HIVE Ventures, the first venture fund focused on investing in Armenian entrepreneurs. I fell in love with venture investing and loved working with founders. What ultimately led me to Index Ventures was the firm’s global perspective on entrepreneurship, which I think is really unique.
What drew you to healthcare?
Of course, it is fun to invest in larger trends like consumer apps and enterprise software — but for me, healthcare is one of those things that touches everyone in the world at one point in their or their family’s lifetime. I don’t know if there is any other “product” or industry that actually does that. And it’s very exciting to me that the opportunity is so big, yet so challenging. I think it takes a very special type of entrepreneur to go after that opportunity. They have to be extremely passionate about what they do because it is one of the hardest industries to succeed in.
How difficult is it to be a successful woman in the VC world? We feel really lucky to have two women sitting on our board (Nina is a board observer, and Jenni Vargas of One Medical is an independent board member). Can you talk about other successful women you’ve seen on boards and give some context to the rarity of that?
It is definitely an interesting time to be a female investor today. Right now, about 7.5% of VC investors are women, and I think at the general partner level that percentage is even lower. While the industry definitely has made a lot of progress to date, there are still a lot of unconscious stereotypes. It doesn’t help that up until recently, most of our cultural representations of a hero (be that a movie or a book), a CEO, or a hedge fund manager are male. So in venture, yes, you see situations where a woman will walk into a board room and be asked to get tea or coffee when they are actually part of the executive leadership team or board.
I am still really optimistic because at least now, the right conversation is happening. The issue is front and center, and I feel like we are at an inflection point.
Why are we at an inflection point now? What has changed?
First, I think women that have been in venture for a long time now have a forum to share the good and the bad. There have been a few women who have really paved the way for that.
Second, I think women are actively helping other women. There is a great movement in Silicon Valley called All Raise, which brings women investors and founders together.
I also give credit to all of the men in the industry who are getting involved as well. This is not just a women issue; men also need to be part of the dialogue. I was speaking on a panel recently at a women in tech event and I was so excited because there were so many men in the audience!
When you look into investment companies, is there anything that you’ve seen in some companies that amazed you?
Creating a culture where everyone feels ownership in something really important. If you feel like you are a part of building something and that you have a direct line of correlation with the success of the company, that really goes a long way, especially in startups.
In addition, with startups, things move quickly and people work hard on many things at the same time. Sometimes it is tough to keep the communication line in real time. Decisions get made, things change. One of the things I’ve seen startups do well is send out weekly emails about strategic decisions or host “Ask Me Anything” office hours with the founders.
When you’re evaluating a company you’ve invested in, what are the best markers and predictors for success?
The most important factor is the team. Especially in the early stage, you are really betting on the person. You can’t predict what is going to happen and many things are out of your control. You just have to bet that the founder you are investing in has the stamina, the passion, and also the know-how to be successful.
The second important factor is the market. We do a true bottoms up analysis to gauge what the addressable market is. A big question that we ask of the market is timing. Why now? What trends make the opportunity for this startup possible?
The third factor is the product. Is there a scalable and defensible product? This doesn’t necessarily mean there has to be IP; many founders get caught up in trying to build something that no one else can build. Instead, we ask ourselves if there is a moat around this business.
The fourth thing we look at is the business model: can we see a line of sight to a predictable revenue stream? Do we understand the business model?
Finally, we are in the business of investing our LPs money to generate returns. We look at the entry point, the valuation, what price we’re willing to pay, and how much we’re going to invest.
Based on your evaluations of telemedicine companies, how does Call9 differ from them?
We have looked at many telemedicine companies — asynchronous, synchronous, and others. I think Call9’s approach is one of the smartest we have seen because the company is not taking an extreme approach that solely relies on telemedicine. Call9 meets healthcare providers where they are rather than only offering a digital solution. Call9 puts a trained responder in the nursing facility, which makes customers A) more comfortable about adopting telemedicine, and B) helps solve a huge problem for them by upleveling the amount of physician care they have available in the nursing home facility. We believe taking that hybrid approach is the right one because it solves an immediate pain point and gives the skilled nursing facility exposure to a future technology without having them have to make that leap to digital only.
We continue to be very excited about Call9 and the future ahead.
