VC Corner Q&A: Amy Cheetham of Costanoa Ventures

Amy Cheetham is a Vice President at Costanoa Ventures, where she’s focused on investing in the next generation of great enterprise technology companies.

She began her career on Wall Street, working at JP Morgan, where she spent time as a technology investment banker and a cash equities trader. Before joining Costanoa, Amy ran North American sales strategy and operations at Zuora, a public enterprise software company that sells enterprise-grade subscription billing solutions.

Prior to that she spent three years investing in growth stage technology companies at Summit Partners, where her investments included Podium, InfoArmor (acq. AllState), and onXmaps. Originally from Maine, she now lives in San Francisco with a very spoiled golden retriever.

— What is Costanoa Venture’s mission?

Our mission at Costanoa is to build the next great early-stage boutique venture firm that helps exceptional entrepreneurs create smart technology and solve hard problems that change how business gets done.

— What’s one thing you are excited about right now?

In 2011, Marc Andreesen famously stated that “software is eating the world.” He was right, of course, and nearly every company has become a software company at least in some regard.

In similar fashion, I believe that financial services are becoming less of a vertical solution and will come to have broader horizontal applications. Every company now has the potential to become a provider of some level of financial services. There is a global trend of software companies beginning to add a payments functionality or bundle debit cards in with their offerings — Facebook, Uber, Apple are just a few of the first movers in this trend. I’m excited about the broader implications this will have for innovation in banking-as-a-service and other financial infrastructure technologies. This should open up significant added revenue potential for many verticalized software vendors that now are able to add payments or other offerings.

— Who is one founder you think we should watch?

No single one, but I’m broadly bullish on non-Bay Area founders and teams. At Summit Partners, I did deals in Montana, Phoenix, and Salt Lake City. The Costanoa team and I are so excited about the talent in these markets and many others across the US and Canada (so email me if you’re starting something new!).

— What are the 3 top qualities of every great leader?

1. Empathy. Having the self-awareness and compassion to effectively understand customers’ problems and manage and build a great team.
2. Vision. Having the ability to envision a product or even a world that doesn’t yet exist and put that into action.
3. Communication. Having the ability to effectively share a vision to hire and retain employees, gain customers, and even convince VCs to invest.

— What was your very first investment? And what struck you about them?

My first investment was in 2017 while I was an associate at Summit Partners. The founder got a call from his father, the owner of a local tire shop, complaining about the dichotomy between the overwhelmingly positive verbal feedback he’d gotten from his customers and the limited, but more negative, reviews he’d received online. The latter were affecting his business’s online reputation and in turn, its foot traffic. His father wanted a way to improve his online reviews but didn’t know how and couldn’t find a simple, easy to use solution to help. Eric set out to solve this problem and began building what would become Podium.

I was immediately struck by the backstory and the fact that Google’s location business search based much of its ranking algorithm on reviews and, as such, driving foot traffic with mediocre or limited reviews was difficult. Not only did small and medium-sized businesses need recent reviews to drive up their search rankings, they also needed a higher volume to smooth out the bell curve of a few unhappy customers. Podium was quickly able to drive this for them with their easy-to-use review generation platform. While the company has grown to be much more than a simple review platform today, it initially proved a wedge that solved a key pain point and drove exceptional growth for the company.

— What’s one question you ask yourself before investing in a company?

Why now? Timing is everything in venture capital, and it’s easy to mistake early traction for good timing. There are numerous examples of great technologies that were too early or too late to market.

For example, Friendster, which launched in 2002 and shut down four years later, is a great example. Five years later, Facebook appeared on the scene with much of the same core functionality and a very different outcome. Sometimes customers aren’t ready or VCs don’t feel comfortable backing early movers in a market or adjacent technology isn’t ready to support the growth of a new and innovative idea.

— What’s one thing every founder should ask themselves before walking into a meeting with a potential investor?

Is this someone I could spend the rest of my (company’s) life with? It’s easy to get caught up in the madness of a fundraising cycle, but it’s important for founders to vet their future teammates (and board members) and ensure this is the type of person they want around the table in good times and bad.

— What do you think should be in a CEO’s top 3 company priorities?

This is very stage-dependent, but broadly, all CEOs should be focused on:

1. Developing and communicating a clear and concise vision for the company. This translates into how easily the product can be sold to customers, prospective employees, and VCs.
2. Building a diverse team and a productive, healthy culture that can execute on the company’s vision.
3. Maintaining a relentless focus on the customer.

— Favorite business book, blog or podcast?

I don’t typically read business related books because I think other non-fiction genres offer great learnings that can also be applied to venture. I’m currently reading about the opioid crisis in rural America — this has opened my eyes to the changing dynamics in healthcare insurance and what these changes could mean for innovation in healthtech and insurtech over the next few years.

— What’s your favorite thing to do when you’re not working?

Get outside. I am an avid runner, hiker, skier, and cyclist. I love to spend my free time enjoying San Francisco and the beautiful surrounding areas we are lucky enough to live near. When forced inside, I like to read and cook.

— Who is one leader you admire?

Shalane Flanaghan. As a marathoner myself (albeit a comparatively slow one), I am constantly inspired by Shalane’s positive attitude, grit, and stamina. While she certainly had a storied career, her most high-profile success came late, at age 37 after reconstructive knee surgery, when she won the New York City marathon. She overcame a lot during her career and I think she can teach us all about hard work and self-belief on the road to success.

— What’s one interesting thing most people won’t know about you?

I’m from a small town in rural Maine where I grew up riding horses and maintaining my parents’ large vegetable garden.

— What’s one piece of advice you’d give every founder?

I’m going to give two, because they’re connected.

1. Listen. Listen to customers (current and prospective), employees, investors, other founders, and even your family. This doesn’t mean you have to act on everything you hear, but you’ll learn a lot if you continue to be open and receptive as your company scales.
2. Talk. Cultivate and maintain a group of founder friends where you can talk about the challenges you’re going through. Running a startup can be a lonely endeavor and creating a close-knit group that you can fall back on is critical to making those lonely times a bit less lonely.

Ready to make a pitch? Startups looking for an opportunity to pitch Costanoa Ventures can apply here!