The Hyphen Portfolio: Our First 6 Investments
I started Hyphen in the summer of 2020 with humble expectations. I never expected the outpouring of interest from investors and founders that I received. My initial goal was to start an angel syndicate with a few friends, find a few investments through referrals, and in the process, hopefully help a few good companies get started. To my surprise, my announcement about Hyphen Capital ended up being viewed over 200,000 times on LinkedIn and viewed over 10,000 times on Medium.
Hyphen’s mission is to invest in and support the next generation of Asian-American founders. By investing in Asian-American founders, we are building a foundation for the future representation and voice of all Asian-Americans.
As I shared in my Substack post titled “The Accidental Mentor”, Hyphen and its mission have clearly resonated and struck a chord with many. The investor syndicate has grown to include the founders of Twitch, Patreon, YouTube, Gusto, OpenDoor, Honey, Boxed, MyFitnessPal, Zuora, Zola, Lark, Rotten Tomatoes, NerdWallet and executives from Nike, Walmart, Google, Twilio, Slack, Verizon, Viacom, OpenTable, Neiman Marcus, LinkedIn, Match, Warner Brothers, Disney and Shopify among others. The syndicate has even attracted managing directors of hedge funds and private equity firms, physicians, law firm partners and many more who are committed to investing in Asian-American founders.
I have also heard from founders around the world who are working on solving problems from sports data analytics to reforestation drone technology. After speaking with dozens of companies, I am proud and thrilled to announce that Hyphen Capital has invested over $1 million in our first six companies. All of these companies were inbound because our mission resonated so much with the community. Early stage capital is often only accessible to those with networks and I became a new node for them as someone who specifically invested in Asian-American founders. I am humbled that these founders would allow Hyphen to be a part of their journey.
Engineering and product teams have countless solutions to communicate changes, but operations and customer support teams still rely on emails and Slack. I experienced this problem first-hand as a founder running a highly intensive real-time operations startup. Our first investment is Relay, a SaaS platform focused on communications for operations and customer support teams. Relay is co-founded by Hetong Li and Jason Yun, two Asian-Americans who worked together at Instacart, where Hetong led growth engineering and Jason was working on customer success and operations. Hetong was previously at Amazon and Twitter while Jason was an early team member at Lyft, Instacart and Cruise Automation. Together they are integrating communications channels for teams into one single source of truth.
Charles Hua was a product manager for Amazon Alexa and has overcome his own personal challenges with communicating effectively. Effective communication is, quite possibly, one of the most important life skills. Mastering communication can be extremely impactful in advancing one’s professional career. Most people don’t have access to classes like Toastmasters or speech coaching. In a post-pandemic remote world, communication becomes even more challenging and difficult. The timing couldn’t be better for Poised, the Grammarly for speech. Charles and his co-founders Soumya Mohan (ex-product lead at Glassdoor, oPower, Microsoft) and Vicky Sehrawat (ASAPP) are seasoned builders of technology. Imagine getting live feedback while you are speaking on a Zoom call followed byanalytics and personalized coaching afterwards. That’s the magic of Poised.
Fractional co-founder and CEO Stella Han was exposed to real estate investing and rental income properties from an early age through her own family’s investments. As a software engineer at Affirm, she and her co-founder Carlos Treviño were interested in buying rental properties for passive income. The process of finding, buying and managing income properties inspired them to do something about it. Fractional is a marketplace for fractional home ownership that generates rental income streams for investors that previously did not have access. Stella and Carlos are democratizing rental income property investing by allowing everyday people to join together to purchase a home and benefiting from the passive income that traditionally was only available to wealthy investors.
Pet parents all too often made the hard decision to skip necessary vet procedures and even routine visits. SnoutID is about to change all that by modernizing the check-in process at veterinary offices. CEO and co-founder Emily Dong is a second-time founder in the pet space having previously launched and sold her first company PawPrint. She is very familiar with the technology challenges that vet offices have in dealing with medical records and data. By enabling patients to have a better and more efficient experience, SnoutID not only frees up administrative time for the vets to see more patients, it also encourages pet owners to consider getting preventative care that they would otherwise choose not to receive by giving them insurance and financing options up front. SnoutID is helping keep pets healthier and patients happier, all while generating more revenue for veterinarians.
Founder and CEO Yehong Zhu’s company Zette instantly resonated with me. I can’t count how many times I have hit a paywall on a news publication and abandoned it. The media monetization model is completely broken and millions of dollars are being left on the table every single day. Yehong is uniquely positioned to solve this problem as a journalist at Forbes and then a product manager at Twitter. By marrying her two experiences of traditional journalism and modern real-time news, she started Zette to solve this painful problem for both sides: consumers getting to read the content they want and publishers being able to monetize it properly. Zette allows readers to consume content a la carte from multiple publications versus being stuck at a buffet from one site, Zette will enable publishers to monetize all the abandoned visits. The publishing industry is in desperate need of revenue and the time has come for it to modernize from the record store to Spotify.
No one loves their calendar. The amount of time and productivity lost on calendaring is real and costly. This cost is only compounded when working in teams. While there are 1.5 billion users on Google Calendar and Outlook, these products have barely evolved over the past decade, and John Li and Michael Zhao saw that as a huge opportunity. Vimcal includes everything a modern calendar should have: instant availability sharing, time zone conversions, hotkeys, and so much more. It is beautifully designed and intuitive, which saves the average user over an hour per week. Vimcal does for calendaring what Superhuman has done for e-mail.
It is no coincidence that four out of my first six investments are led by Asian-American women CEOs. I am a firm believer that early stage capital is the most important money you will ever raise, because it will allow you to pursue your dream. For many Asian-Americans, this is very literal. I have spoken to founders whose parents have disowned them because they left graduate school or quit a big corporate job to start their own business. I believe that the reason there aren’t more success stories of BIPOC and women founders is not because they’re not as capable or talented as leaders, it’s simply because they don’t receive the capital at the top of the funnel to prove themselves. Meanwhile other founders have access to capital through their networks or a trust fund or family support if things don’t work out. Many potential immigrant and BIPOC founders have school debt that they must repay and cannot afford to go without income for any period of time. If they don’t have financial support from family or their network, they can’t afford to take the risk because they have no safety net to fall back on. The margin for failure is far too narrow so they never take the risk in the first place. Without early stage capital, it becomes impossible for these would-be founders to quit their job or drop out of graduate school to start a business. This is why it is so important to have diversity of investors at the early stage. It is also why I’ve reached out to other founders to replicate what I’ve learned from Hyphen for other communities of color.
I have been inspired by women in my life from my grandmother, my mother, my sister, my wife and many friends who are fierce and can handle anything. I’ve seen as much through this pandemic as many households would be collapsing if it weren’t for mothers keeping them together. Women heads of state such as Tsai Ing-Wen and Jacinda Ardern have been applauded for their exceptional leadership and management of COVID in New Zealand and Taiwan. I shouldn’t be applauded for investing in women, because doing so shouldn’t be considered a noble act. Women don’t want you to invest in them because of a quota or a movement, they just want a fair shot. I invest in women founders because I believe they will yield optimal financial returns. The data doesn’t lie. I see the hesitation and underestimation of other biased investors as my opportunity. Research from BCG has shown that women founders raise less capital but generate more revenue than startups founded by men. If these founders are given the chance, data shows that they are more likely to prove themselves and reward investors.
I invest in women founders because I believe they will yield optimal financial returns. The data doesn’t lie. I see the hesitation and underestimation of other biased investors as my opportunity.
Early stage investment of any kind can be life-changing. Not only because it buys a founder time to build and find product-market fit, but it is also a sign that someone believes in them. That confidence and encouragement is often even more valuable than any cash in the bank. If you would like to be a part of making an impact at the top of the funnel, please reach out on our new Hyphen Capital website! Proud that Hyphen is built on Asian-American founded products including Webflow, Notion, Airtable and Canopy.