What follows is the transcript of my recent video interview with Silvia Mah, PhD, a prolific Angel investor focusing on women-led companies and diverse founding teams. As you’ll hear, like with my investing practice, Silvia is not doing this to be “correct” but because it works as an investment thesis. I hope this excites you about the possibilities for yourself.
She talks about her own biases and what she does to mindfully counter her own biases. Silvia also strongly favors founders that are explicit about the risks faced by their businesses and what they are doing to mitigate those risks. Diversity among a founding team itself is a risk-mitigation strategy. You’ll hear during this interview a number of examples of how to present risks and mitigation of risk in a positive, optimistic way. I was very pleased to hear how much we agree on this point.
All in all, this is a fascinating interview with a fascinating investor in every way. You’ll find a great deal here of immediate value to you as you reach out to raise funds. Near the end, she gives you the best method to reach her personally about your business.
Robert Steven Kramarz: Hi there, this is your Vision Master podcast, back again from Intelliversity. And this is your host, Robert Steven Kramarz. I’m very privileged to introduce to you today Silvia Mah, who is a prolific investor, Angel investor, of that individual type and she’s heavily involved with the investment community in the United States, and in particular in the San Diego area, but also all around. I think the number’s now up to 120 companies that you’ve been involved in, with about 80 that you’ve actually pulled the trigger on.
So it’s really quite a large exposure that you have. So I know we talked about a number of things just before this interview, but out of that many companies, how many companies have you actually had to vet, and have you looked at over the last couple of years?
Silvia Mah: Yes. I’ve had to look at thousands. That is part of the sourcing flow for investors. But, out of the 120 that are part of my portfolio, we were talking about 80, which I pulled the exact trigger on. The reason for that is, an individual Angel investor, or a VC, can pull the trigger by themselves because it’s one-to-one. But I’ve been involved with so many funds. I’ve now invested in 11 emerging fund managers, from different types of funds.
One of them is an event fund. One is a true VC fund, it was like a million dollars and it was a five million. But, I’m intricately involved, because their all are all emerging fund managers that I feel like I’ve pulled the trigger with them, right?
Robert Steven Kramarz: Yes. Sure.
Silvia Mah: Or, let’s say, San Diego Angel Conference is a collective of about 50 to 60 investors that all put one vote or two or three votes in, depending on the unit size, to actually pull the trigger. So your question then thirdly is due diligence and who have I really gone into depth with, is practically all of them. Because, it’s either that I’m involved with a fund, the one that’s more, one step removed is being an LP at the portfolio. Which was launched and raised by Trish Costello because the platform itself has amazing fund managers that raise funds and we are LPs and it is meant to be more of come in and come out as you wish. Love that type of scenario.
Robert Steven Kramarz: Well, what’s interesting here is that where I wanted to go with that was that, even though you’ve invested in a lot of companies, you’ve looked at way more.
Silvia Mah: Thousands. Yes.
Robert Steven Kramarz: The percentage of companies that as an investor you’re getting involved with is maybe 5% of the companies you look at?
Silvia Mah: Yes. That’s typical. I think that what’s interesting about my career is that I have raised four types of business accelerators throughout my years. In that acceleration piece, you get so many applications for different programs and different events and all that. And then also as a mentor, or let’s say a pitch competition judge, I get to see so many possible investment opportunities, but I have to be actively part of my ecosystem to be able to have those thousands of entrepreneurs to look at.
Robert Steven Kramarz: Now your primary company is called Stella, right?
Silvia Mah: Yes.
Robert Steven Kramarz: And you’re also involved with Ad Astra. What, yes. What does Ad Astra do?
Silvia Mah: Ad Astra Ventures is a venture group, a micro VC basically that I have two other partners. We have Allison Long Pettine and Vidya Dinamani and myself that we created about four years ago. We wanted to invest in female-led businesses and we have a boot camp and we had an accelerator program. We have a venture builder and we have about 20 or so companies that we have invested in. And we do get very intricately involved with those companies. And then Stella as a brand and as a network of the constellation, S-T-E-L-L-A is part of the constellation and network of women entrepreneurs and the founders that fund those entrepreneurs.
We have Stella Labs, which is a business accelerator for female entrepreneurs. Then we have Stella Angels which is an Angel syndicate and an Angel group for female Angel investors to invest in female-led businesses. And then we have a women’s venture summit. That again is now in its 10th year of having this event annually to bring together women, entrepreneurs, and women investors.
And with that, we have a women’s fast pitch that allows us to get across the nation to get as many women ready to pitch, pitching in front of investors. All of that together, it’s a really great ecosystem, a nationwide and global entrepreneurs and investors.
Robert Steven Kramarz: Well, and so we’re going to get into a lot of that in just a second. The reward for you guys that are listening to this, is that at the end, I’ll tell you how you can actually get in contact with Silvia or her groups. That’s the prize for listening to the rest of this, the next 15 minutes. One of the things that is really interesting here is that you tend to favor women-led companies, or as I understand it more broadly underrepresented founders, right?
Silvia Mah: Exactly.
Robert Steven Kramarz: So tell me a little bit more about why you chose, I mean, obviously you’re a woman, but why you choose to go down that route?
Silvia Mah: Well, there’s a lot of different things, emotionally, personally, and also a good business case and the right decision in my book as an investor. We know that women outperform their male counterparts by lots of data out there. I’m a data girl. I don’t just say, I want to have this thesis because I think it’s a better thesis than anybody else. I’m not that way at all. I say, okay, what is the data out there that showcases that I’m going to make the best investment decision I can as an individual investor.
With first-round capital, they did a 10-year review of their portfolio and they have about 10 things that showcase why certain startups were outperforming their other startups in their portfolio. Number one was that women outperform their male counterparts by 63%. That’s amazing, right?
Robert Steven Kramarz: Isn’t it? Yeah.
Silvia Mah: And what’s great about that because I’m a gender lens investor. There’s a lot of data around gender lens investing. I will invest in the female and other ones will too. But they were not having a gender lens, like say thesis. They were just saying, “We want to pick the best companies for our fund.” And they bit picked the best companies. And then when they look back, low and behold. So very exciting about that. That’s why that data is super important.
And the other piece, there’s a lot of data out there from companies that are doing this all the time. Like PricewaterhouseCoopers and Forbes, all of these other organizations that say, okay, what makes a very good team succeed? Or make great business decisions? And what they find over and over and over again is diverse teams make the best decisions.
Robert Steven Kramarz: That’s what I found too.
Silvia Mah: So that’s why that underrepresented founder is super important to me. I’ve invested in African American men who are building companies because of their experiences, their life experiences, or they want to make an impact in this world. Or they want to create a business that is just like phenomenal. Also, LGBTQ founders that don’t get, let’s say the amount of funding that they deserve in that super early seed stage and then going along.
And also with students and I teach a lot at universities. There are some students that just are the ones that you need to invest in because they’re amazing and they build amazing companies. Well, that’s also underrepresented. And immigrant, as an immigrant myself from Venezuela to the United States, I really have a soft spot for that. But we have a different case of why we do what we do as investors and entrepreneurs. I want to dive in and invest in those types of companies.
Robert Steven Kramarz: Now, if a company came to you with say a traditionally white male founder, CEO, a co-founder that’s underrepresented. Would that be something you would be okay with to listen to?
Silvia Mah: Yes. There’s a lot of controversy around that all the time. In the gender lens investing and diversity, you can’t just bring in somebody just because you want to have that checkbox. But if you’re creating an amazing dynamic team that has diversity as part of the team or that you say, “I care about diversity as whoever you are.” That is what’s really interesting because that allows you to equate it to culture.
How do you create an incredible company? You know that if you care about diversity, you’re going to have a diverse team and employees in the future. And all of those employees will actually make better decisions. So all of that plays a part in having that, the initial, let’s say, small team. Why did you put this team together? That’s what’s important.
Robert Steven Kramarz: If the founding team of two or three are all exactly the same, that says something about the mentality of the founder, that they’re afraid of different points of view, that they’re not coachable, that they’re rigid because they’re afraid of having that kind of cognitive diversity on their team.
Silvia Mah: Right. Yes, exactly. And I know that you care about this tremendously. For me too, is not just like what we look at on the outside. I look like I’m pretty much white, but I have a culture growing up in Venezuela and I’m married to a Chinesican. I have different views and then I have a special needs sister and a special needs son.
So cognitive diversity too, is like, okay, well, what about, let’s say when you’re growing, would you consider hiring an autistic kid or an autistic kid adult? Interesting, right? That type of diversity in a team as you’re growing, wow. What decisions could you make?
Robert Steven Kramarz: Amazing.
Silvia Mah: That is like, that’s the open ocean and the blue ocean that we really want to invest in as investors saying, “Ah, there’s something about this team that I want to know more about.”
Robert Steven Kramarz: So a team comes in front of you and you want to learn more about them. Because we’re all biased in some hidden ways or society just biases us. How do you suspend those biases so that you can get a clear view of what’s really going on in this team?
Silvia Mah: I love that question. I know that when we were talking before this interview, I said, “Well, I don’t have any bias.” I’m like well actually I do. I neutralize my own bias because I’m like a neutralizing bias promoter. I know the actions that I have to do to, again, neutralize the bias that I have been born into. We all have a society that we get thrown so many different messages and communication and photos and this. Everything flies through. We have a worldview that is biased, right?
Robert Steven Kramarz: Correct.
Silvia Mah: And that’s data is out there and research has been done. It’s like if you give a white piece of paper to a kindergartner and you say, “Draw a scientist.” They will always, I’m doubt of this, I think it’s like 80% or something like that will draw a picture of a male scientist.
Robert Steven Kramarz: With glasses.
Silvia Mah: Yeah, with glasses and the little pen things. That is bias. So those are the kinds of things that when it’s so in your face, you’re like, of course, that’s bias. I don’t have bias. But when you have somebody in front of you as a founder, or you’re reviewing something on a resume, let’s say you’re in a corporation.. Or you’re reviewing a pitch deck or something like that bias creeps in that you don’t even know about.
For me, I know and I know a lot of investors do, that you do have something in your head that what does success like a successful startup founder look like. And you have to demystify that all the time. Because you’re like, okay I have that in there. And then I get like Forbes and Inc. and Tech Crunch and all these things are just flying at me all the time. I’m formulating in my head, unconsciously, what that looks like. So you have to know that you have bias. Then how you can, like you asked me, what do I do?
Robert Steven Kramarz: Self-awareness, mindfulness.
Silvia Mah: Self-awareness is one thing. The awareness piece. And how you act on it is how you impact your decision-making. So the action that you do is like saying, “Okay, I’m going to look at the founder and I’m going to look at the startup and try to figure out line by line what are the successes that they’re having? Are they having the right amount of traction in that industry? Are they doing all these things? Do they have the right team? Do they have the right diverse team? Are they make and the right decisions?”
You demystify say that broad stroke example of success by saying, “Okay, I know that all of these things need to be conducted in a startup.” Traction, team, momentum, business model. All the things, the five Ms of investing. And trying to figure out, okay, how do I evaluate all those things? Instead of just saying, oh, they don’t look like or they don’t sound like or they don’t have the right product that looks like the product that I want to see in this world. So you have to think about it as individually evaluating those companies.
Robert Steven Kramarz: Now there’s a particular technique that both of us use that I’d like to focus on, which is to take a look at how the company and the founder are mitigating specific line items of risk, failure modes. Tell me more about how what you look for there.
Silvia Mah: I love doing that. I’ve written so many due diligence reports in my life and I tell actually other investors that I share my due diligence report, my process. I say you know what? We all know the successes that they’re doing. It’s like up front and personal, you know that. But that section of risk. What are the risks that this company has? But more importantly, is how are the founder and the team mitigating that risk?
It doesn’t mean that I’m going to take away that risk. The risk is still going to be there, but how are they mitigating is super-important. I actually talk to the entrepreneur, I don’t just say, “Oh, the risk is to myself and I’m going to keep it to myself and the investors.” I say, “There are the risks that I see in your business. Can we talk about that?”
And if they’re not willing to talk about it, that’s a coachability thing. That’s like a red flag. But if I talk to them and they’re like, “Yeah, I totally understand that risk.” Let’s say, and it is an example. I love examples. Let’s say they’re a CPG company, a consumer product goods company, and they’re going after customers. And they’re like, you know what? We have 10,000 customers and stuff like that. I said, “But customers are fickle. Do you understand that? How are you mitigating that?”
And they’re like, “Oh no, no, our customers love us.” I’m like, what about if they don’t, they become not, or there’s another entry into the market or the market changes. They don’t have, let’s say if it’s nice to have a product, and now the economy, like what we’ve seen during COVID, the economy crumbles, what happens then? And then they’re like, “Oh, well, I don’t know.” Or they have a response of, this is how we’re going to do it. That’s that risk mitigation piece.
Robert Steven Kramarz: That’s so important. When you get really good thinking on risk mitigation, which sounds really technical, but it’s being conscious of the risk and creating a strategy to reduce the possibility that risk will actually occur or the impact of that risk if it really occurs. If they’re not focusing on those things at all, that’s a danger sign, a red flag.
Silvia Mah: Yeah. And another example would be the product. It’s like the red flag of okay, the product might not be as sticky as we want it to be. And we put this say, “Hey, the risk is that the product is not very sticky.” But the risk mitigation is like, they’re building out, let’s say new versions or product extensions that will make it really sticky because they’re talking to the customer to find out what they need to make it a must-have.
Oh, that’s great. Because as an investor, I can’t say they have it all worked out because it is a startup, I invest in the seed stage. When that happens, you might not have all the answers and that’s why still it’s a risk. But that risk may be like, okay, the opportunity is here for them to be the company that they want to be. That’s awesome. Let’s have that conversation every day. And not that it’s a red flag, it becomes an orange flag that’s flagged as possibly mitigated. And then you keep on helping that entrepreneur as they mitigate more risks.
Robert Steven Kramarz: Well, what I meant is if they are never at risk at all, that’s the red flag.
Silvia Mah: Exactly.
Robert Steven Kramarz: When they start really seriously spending a lot of time looking at each of the possible risks and failure modes, that’s a very good sign. That’s a very good sign. I know one of mine is older people. We’re used to entrepreneurs being under 40 or something, or even under 30. But when an older says someone in their 60s and their partner is also in the 60s or even older, and they have a great idea and they’re doing everything. But there’s a real fundamental risk factor there isn’t there? How will they address that fundamental risk factor that they may age out?
Silvia Mah: But I also think that there’s a success too. I think that there are positives and then there are risks. The positive is, they’ve done been doing this for a while. If they’re doing something that is exactly down their career path and they have deep expertise, well, that’s like one right up there. Deep expertise in this field. The risk mitigation is you can put that in there, concern with making sure that they have a team that knows what’s going on right now trending or something like that. If it is, let’s say for the marketing play.
Robert Steven Kramarz: We also got to make sure there are successors that are built into the team.
Silvia Mah: Yeah. I think that that’s a really great view of what that company is because, for a really 20-year-old company, it’s a reverse. It’s like the success is, wow, they’re really engaged but they don’t have the experience. Of course, that risk is minimal experience. Risk mitigation is a great advisory board. I see it as everybody, I don’t discriminate by age. I have some amazing, amazing portfolio companies that are in their 60s and I absolutely adore them and they’re doing great. And just making sure that it’s a black and white risk. And playing on each other’s strengths. Saying, “You have a strength that’s here. There’s a risk here. How are you mitigating that?” And let’s have a conversation there and get the right investors that understand that.
Robert Steven Kramarz: Got you. All right. How does somebody get in touch with you? What’s the best route? Throwing the business plan over the transom is probably not the best way to start.
Silvia Mah: Yeah, no, no, no. The reason why I mentioned the network at first is that an investor who wants to make the best decisions needs to have a network. It’s not that you can do it in a bubble. You can’t do it by sitting in front of a Zoom and assuming somebody’s going to come to. You have to build networks. You have to be part of an accelerator. You have to maybe join an Angel group with somebody. That’s why I said at the very beginning because that network is super important to be able to be actively out there engaging with entrepreneurs. That is what there is the magic.
How you can get in contact with me, my platform of choice is LinkedIn. Reach out to a lot of people, reach out to me by DM on LinkedIn is very, very easy. I’m also on Instagram. But LinkedIn is probably the best place to get ahold of me.
Robert Steven Kramarz: Got you. And so your LinkedIn profile is well just Silvia Mah, right?
Silvia Mah: Yes. Of course, all of the things that we do, all of the events, I’m always very actively involved with the women’s venture summit, women’s fastpitch, with San Diego Angel conference, with boot camps Ad Astra Ventures. But those are all-in events and we’re usually heading down. I’m like, wait a minute, we can’t take anything. Connect with me on LinkedIn. Send me a really nice DM.
If you do connect, this is just a tip for everybody who’s connecting with investors or anybody who is connecting with their network, send a note with your connection. Don’t just connect with them. Because I have about 500 that I haven’t even touched because those are the ones that did not give me a note. If you give me a note saying I heard it from Robert’s interview with you and love what you said about this, or I read Intelliversity’s blog about you and I love this about it. Or I’ve seen you at this event. Awesome. I will say yes every single time. But if you don’t say anything there, I do not know who you are and would love to know you.
Robert Steven Kramarz: And remember to include their email in the DM that’s on LinkedIn.
Silvia Mah: Yes. If they want to. That doesn’t matter. It depends on how they want to connect with me but must have that note.
Robert Steven Kramarz: All right. We’re running out of time. This was Silvia Mah of Stella Labs and Stella Angels, Ad Astra, and a number of other organizations. I’m glad you stayed with it. That is how you get hold of Silvia. If you want to reach me, you go to Intelliversity.org/connect. In my case, just set up an appointment. If there’s any time available, I will take your appointment and we’ll talk about your business and what we can do next.
Silvia Mah: And you’re such a great resource. So thank you, Robert, so much for always being so open for entrepreneurs,
Robert Steven Kramarz: Thank you for the energy that you bring, the youth, and the enthusiasm. It raises my excitement level about what’s possible just being around you.
Silvia Mah: Oh, thank you. It’s likewise. As we’re creating an ecosystem that needs to build off of each other and build a village that we have conscious capitalism, investors that care, and entrepreneurs that want to make an impact in this world. And that’s how we create a better startup ecosystem and innovations thrive from there. Thank you for what you do.
Robert Steven Kramarz: Great. Thank you. Till next time. This is the Intelliversity Vision Master podcast signing off because “that’s the way it will be.”
To contact Mr. Kramarz to discuss your company, create an appointment on his calendar here.