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One day soon when you see a robot squirrel on a 10-foot unicycle, think of Danielle Strachman. These are the types of ideas Danielle Strachman sees and backs on a regular basis at her VC fund, 1517.
The fund, which proudly backs “dropouts, students, and sci-fi,” has had several fund multipliers in their portfolio, including Loom (Acquired by Atlassian) and Luminar Technologies (IPO 2020). Plus, her star-studded community includes Vitalik Buterin of Ethereum, Laura Deming of The Longevity Fund, and Dylan Field of Figma – all of whom she first met when they were teenagers.
Danielle’s commitment to bringing freedom and autonomy to young people is much of the reason behind 1517’s work with upcoming founders — which includes children as young as 10 years old!
We talk to Danielle about why her firm hands out cash grants to kids, where she sees the future of deep tech headed and how she’s helping it get there, the right characteristics (and anti-characteristics) to look for in founders.
Danielle invests $100k angel checks and $500k pre-seed checks out 1517 Fund focusing on dropouts and sci-fi / deep tech founders.
Highlights:
Highlights:
- 1517 exists to address the lack of capital for young people and for the deep-tech sci-fi space. Danielle is particularly drawn to “dropouts” who skipped the higher education path to focus on their work and start their companies.
- Danielle likes to think of her fund as Grand Central Station, a place that helps people get to where they want to go next. She uses her relationship building skills to stay in touch with founders and connect them with new opportunities.
- Danielle loves meeting “crazy scientists” and people who are working on solving the future’s problems. 1517 is unique because it makes two investments in these types of companies: a $100k angel check for R&D and a $500k pre-seed follow-on check.
- Danielle understands the power or relationships and mentorship in a space that can often feel impersonal and transactional. She’s kept in touch with many founders over the years, including the founders of Loom and Luminar Technologies – whom she met back when they were teenagers!
- (00:00) - FIFU 15 - Danielle Strachman
- (06:41) - The 1517 Differentiator: An anti-establishment fund for dropouts
- (08:15) - The Why: Bringing freedom and autonomy to young people
- (18:49) - 1517 as Grand Central Station: Helping people get to their next destination
- (26:35) - Lessons from the Worst Investment: Listen to your gut
- (35:24) - Best Investments So Far: Loom and Luminar Technologies
- (37:54) - The Fund Formula: 85% dropout and 15% sci-fi
- (51:47) - Nurturing Young Talent: How Danielle sources next gen founders
- (57:34) - Speed round
Creators & Guests
Host
What is First Funders?
Learn from angel and seed investors bold enough to write the first check.
How do they decide which startups to invest in?
How do they gain conviction in founders and ideas?
How do they add value to their companies?
Shaherose Charania and Aamir Virani are operators turned investors. They chat with their friends investing in early-stage technology startups and learn about their strategies to fund the best founders and startup companies.
If you are an angel investor or seed investor, you'll hear how others operate.
If you are a startup entrepreneur, you'll hear how investors filter and decide on writing that first check.
FIFU 15 - Danielle Strachman
===
[00:00:00]
Shaherose: Welcome to the First Funders podcast.
Today we have Danielle Strachman, the GP of 1517 Fund. I wanted to start this conversation by sharing a bit about how we know each other. So I look back in my emails and we were introduced in 2011. Oh my, I. I know, right? Naveed Lalani introduced us. You were at the Thiel Fellowship.
And I just remember from that point on, like I knew I could always email you and stay in touch with you on anything I had. You were running the Thiel Fellowship. I was running Founder Labs and 2. 0. And every time we connected, There was a sense of support. We shared founder intros. I would introduce you to someone, you would introduce me to someone.
And I even [00:01:00] found a document where we brainstormed an incubator for high school kids. I don't even remember this.
Danielle: That's awesome. I don't remember this either, but I'm so glad we did that. Yeah.
Clearly we didn't do it, but there was some thoughts and plans and there was a timeline, there was a budget.
Shaherose: It was a legit proposal. And in all those interactions over the years, what I remember most is that you were always game to brainstorm and that you were always game to take or make introductions. And I think that's what makes you so great is you're open and willing and there's no wall to get access to you and your knowledge and your wisdom.
So it's been so great to see you progress from the Thiel Fellowship Days to now Fund 3 with 175, I think, under management.
Danielle: So Fund 3 is 80 under management, but like the total fund is somewhere more in the ballpark of what you're talking about. Yeah, that's true. I don't, sometimes I forget that people, add up all the numbers cumulatively.
And I'm like, Oh yeah, that's right. They do that. [00:02:00] I always just think about the current fund. I'm like, the other ones are deployed. So that those numbers don't count anymore.
Shaherose: But, you're managing a lot of money, which means you're also investing in a lot of founders and a lot of different types of founders, which I can't wait to talk to talk about.
And you're also investing in different ways, like not just with VC money, but with grants. So with that, someone who has been just sort of, a unique person in my network. I'd love for you to introduce yourself and what led you to investing.
Danielle: Yeah. Wow. Well, thank you so much for having me and the wonderful intro and taking me back down memory lane of like, we brainstormed this doc and I love that neither of us remember.
And like, that's so beautiful. I love that. we were jamming on things. It's incredible. , I always start with that, like,I was not supposed to be in this path. I didn't grow up thinking I would be in finance. In fact, if I went back and told my like little girl self, you'll be in finance. She'd laugh.
She'd be like, what? how'd we get there? And even if I went back and I talked to myself from 14 years [00:03:00] ago, when I was on the very beginning of the, Thiel Foundation team, She would laugh too. She'd be like, you're in finance now? how'd that happen? So it's been a circuitous path.
I was just actually mentoring a young woman right before this call and she was asking me about how to make different choices and where she goes with her career. And what I told her was that , I've just been very fortunate in that I figured out what my own personal calling was when I was 22 years old.
I did this workbook called Zen and the Art of Making a Living, and it's like one of those, like, you write down stuff, and, when I talk about this book, sometimes I feel like it's hokey. I just reordered it again, so I can, look at it and be like, hmm. But I've heard from young people today that they've , loved the exercises.
I'm like, okay, good. I'm glad it holds the test of time. But I, I really, through, Sort of working things out was able to figure out that my calling was something around bringing freedom and autonomy to young people. And so then when opportunities would come my way, it was very clear. Is this a yes or no for my own personal mission?
[00:04:00] And the Thiel Fellowship, , came to me in a, sort of circuitous way as well, where a friend called me and said, Hey, the foundation is starting this program, you should get over here. and I was like, Oh, well that is a perfectly aligned thing for me to do because it is part of that mission of bringing freedom and autonomy to young people.
My colleague, Michael, and I, my co founder and Co-GP at 1517, we were both on the founding team of the Thiel Fellowship, and we were running that program for the first five years. And one thing that we saw over time was just how much the investment community didn't really take young people that seriously.
And I think that's changing over time and people are much more, open eyed about it. Thank you. But in the past, and even to some extent today, when investors talk about young talent, I think what they mean is come work at my portfolio company, not I want to give you money. And we just saw this again and again when we were at the Thiel Foundation with Thiel [00:05:00] Fellows.
And some of the, Thiel Fellows have done extraordinarily well. I've been watching that Ritesh from OYO Rooms is expanding into the U S and has been, and I'm like, wow, that's so cool. Like, you know, we knew Ritesh when he was just a guy, he was just a teenager, honestly.
Vitalik with Ethereum and. Laura Deming, and she has the Longevity Fund, and now she's doing a new startup in the cryopreservation space, and Dylan Field with Figma, and it's been really amazing to watch these journeys, but we also saw the ups and downs of who would be the funders who would take them seriously past us, because we thought a lot in the Thiel Fellowship about both on ramps into the program, but also off ramps from the program.
Because as generous as the foundation is we could only fund somebody once. If we liked working with them, we couldn't be like, Hey, here's another Thiel Fellowship for you. And oftentimes, especially if someone had a startup, and back in those days of the fellowship some people had nonprofits, some people had projects, some people had research, some people had [00:06:00] startups.
So, we're always looking for different off ramps for the different types of people. And there weren't that many funders that we could refer to that we thought would actually just have a serious meeting with someone who is 19 or 20 years old. So, five years in, my colleague and I, Mike, we were, Kind just looking at like, wow, we think the upward trajectory of this program is really high.
We're already starting to see some really neat success. And we think there's a case to be made to use a new tool called Venture Capital to fund these people. So I think of our work with 1517 as just an extension of that mission and just a new tool for which we're carrying out that mission. And in fact, at this point we often sort of iterate on what we do.
The 1517 Differentiator: An anti-establishment fund for dropouts
---
Danielle: I think it's one of the things that makes our team like keep things really fresh is we're always like, gosh, what are we at 1517? And, technically, yes, we're a venture capital firm. But we also have this mission of working with people who don't have. College degrees and are outside, a typical [00:07:00] pathway.
A couple of years ago we used to say, and we still say that we are an invisible college. we're like this educational institution of sorts, but doing it in a very distributed way. And actually as of recently, what we've started saying is that we're really like, Cutting the leash for people who have very untapped potential, where it's like, I just got a dog in the last year, so I'm like all about dogs right now, but picturing a dog on a leash who's pulling on it and it's our job with people is to cut the leash.
go be free, go do that thing. Be unencumbered. So yeah, we saw Venture as a way to scale our work from the Thiel Foundation and take things forward. We've been doing it 10 years now. It's going to be 10 years next year, which is pretty exciting. We're just going to be starting raising our fourth fund soon, so that's also exciting.
We just want to keep Moving this mission forward and using venture capital as that tool to do it.
Shaherose: It's so [00:08:00] meaningful for me to hear someone who chooses to go into VC with a really strong mission. So your why is super clear and something's inside of me asking, well, why this though? Why is this your why?
How did this all happen for you?
The Why: Bringing freedom and autonomy to young people
---
Danielle: Yeah. I mean, for me that it goes back to my personal mission of bringing freedom and autonomy to young people. I've just always loved it. It's funny. Over time, my definition of a young person has changed. so when I was in my early twenties, my definition of this was more working with younger children, maybe K 8, something like that.
And then with the fellowship, it was like, These are teen young people we're working with. , and I joke that someday when I'm in my sixties, I'm going to be like, those 40 year olds, they really need this and this and this. Um, , so someone who inspires me, who comes to mind is Maria Montessori.
You know, I think people will be like, Oh, she's an educator. She's a philosopher. I think sometimes women who are philosophers don't really get their due. And she's one of them and she just has the utmost [00:09:00] respect for children. And I think what she really sees in children is very much raw human potential and ability.
And I think she noticed Hey, we're not doing this whole part of the population of service. And by not We're probably not doing a service to all of humankind. And so I was really influenced by her when I was in my twenties. And that's just stuck with me over time. I think we downplay both what younger people and older people can do.
I think both of those populations are very much cut out of the, "can make a real contribution to society" thing. And yeah, that's just always ruffled my feathers. I'm like, it doesn't have to be like that. And, I used to work with homeschoolers, so I started a tutoring company and very randomly I got niched in with homeschooler populations and they changed my whole life.
there was this young, one young man, I'm still in [00:10:00] touch with the family who was 13 and they were like, He was really into lapidary. Um, so gems and setting gems and all kinds of ways. And he would go to these big conferences and all kinds of stuff, and his parents let him follow his passion and he, was creating.
Beautiful objects and all kinds of stuff. And I was like, wow, this isn't kids play. this is really deep work that he's doing. And so over a long period of time, I just saw how much children were sort of siloed into this, Well, they're not really contributing, , they're playing, and I think play is really important, \ , but anyways, yeah, that, that mission piece has been really strong for me, and then, in addition, I'm really into choice, so one path is not for all, so at one point I started a charter school and the idea there isn't that our school is the best school for every kid.
It's that great for the children who want to be there and the families who want to be there. And I feel the same way about the Thiel Fellowship in [00:11:00] 1517. If someone's really enjoying their time in college and it's the right choice for them and they've done the math on their loans and like, they know what it's going to be like, they're eyes wide open.
I'm like, cool. You're making a conscious decision. That's awesome. But for some people, they're like, I have things that I want to do right now. And everyone's telling me I have to stay in this environment. Otherwise, I'm not going to make it in life. I just think that's patently wrong, and dangerous. I think it's really dangerous thinking to put everyone down sort of one pathway without thinking about, well, is this actually the right thing for this individual person?
So that, that's really where it comes from, for me personally, and also for the fund.
Shaherose: Yeah, I love it. I just had a baby. It's been two and a half years now. Also went down the Maria Montessori rabbit hole and my son's in a Montessori school and I see how different it is for him to have choice and explore what's exciting to him and the way we're raising him is a lot of choice [00:12:00] in the house and it's fascinating.
He's two and a half making decisions about. literally what he wants to eat, what he wants to wear, what he wants to do. And we started that early and I see how that's shaping his mind and his worldview. Very, very differently than how I grew up in a traditional, traditional school, and for very traditional , sort of top down households.
So,
Very exciting to see how you, are using this platform as a way to unleash young potential. So thank you for doing that. Uh, it's, I agree. It's great for society. We need this.
So let's talk about this first investment story. we've asked all the people on our podcast, what's that first investment you made?
what did you learn? It's always memorable when you write that first check.
Danielle: No, absolutely. So it was an interesting time period because we made the first investment before we got the funds. Like fully off the ground. So when we were raising our first fund, almost 10 years ago, we were [00:13:00] talking with a potential LP, and an LP just for the audience is a limited partner.
Those are the people who invest in a venture fund. So we were talking to this person and it's just asking us questions. And he said, well, how do you know these people you want to invest in will take your money? And it was such a left turn question. I was like, uh, cause we've known them a long time.
I don't, I don't know how to answer this question. Like, cause of course they will. I'm not, I'm not really sure where to go. And he's like, okay, well, I'd really like to see you guys make a couple of. I like to show that you could do it and I was like, okay, that's interesting. And one of the things we were socializing in our first deck, which I always recommend to fund managers, is we had something like five or six teams, that we had talked to and gotten their permission and said, you know, these would be the people, like if we get to a first close, these are the people who are ready to go on right now.
Some fund managers will [00:14:00] sign docs and then just delay wiring money. we don't do that. So we got permission from people. We didn't sign any docs where we couldn't keep our promises or anything like that. Um, but we knew who this sort of batch of like five or six teams were.
And so then when this LP said, like, basically like, show me the money, we were like, okay, I guess we have to make some investments. So me and Michael, my co founder, we cobbled together 150, 000 between both of us, that was basically like all of our savings. We didn't have a lot. We're like, okay, we're going to make two investments.
And we made them at basically like right exactly the same time. One was a team that was working on trying to monetize GIFs. It was a team of two brothers. We actually love sibling teams at 1517. And we had gotten to know them over the past few months. And then the other team, was the founding team of Fountain, which [00:15:00] is a hiring platform.
Uh, they are a, I believe they're a series C company now. And so it's been interesting to see that one company has really hit it out of the park and has become a big player. And the other company was taking a crack at something that was really, really difficult, and didn't make it.
And that was totally fine. one of the things that we talk about in this part of our onboarding process at 1517 with founders, when we bring them into the portfolio is, we often think about these polar opposites that are often at play in really running anything, but, you know, in running the fund.
And one of those is that we have to truly believe that every single team we back could be a fund multiplying company where it's like you're going to hit it so far out of the park that we're going to 4x our 80 million fund. we have to have that belief. The next slide to that after that one. is, and we know realistically the most likely thing to happen is that it all goes to zero.
And we want that [00:16:00] to be really freeing for people because we want them to swing for the fences and try things that are really extraordinary and difficult and not just think about, well, how do I return some money to 1517? Because our job is that. They either do really great or it goes to zero. And I mean that in the true math sense of numbers, not like these people are zero.
Um, I think people equate a company closing with like, oh, well then that means this equals two bad founders. I just think that's completely false. And you can have truly great founders where they're struggling in a particular market or it's hard to find product market fit, and we've backed teams sometimes numerous times where we're like, wow, okay, they haven't hit it there yet, but we still think they can do it.
They just need another shot on goal. So yeah, those are our first two investments. And it was interesting cause we were doing reviews with our companies. We do reviews with them every other month for [00:17:00] the first year of the company. And then we taper them down over time.
And with the GIFs team. We would go chat with the brothers and every time it felt like clockwork. One of them would be like, gosh, you know, this one person we've hired, they're just not really working out. And they talked to us about it. We're like,
oh
yeah, it's probably time. Time to let that person go and think more about how you're doing your hiring.
And it was feeling like every time we met with the team that someone was getting fired by the end of our meeting. And I was like, Oh no, this is terrible. We want to be more on the proactive side here of this, and being able to help people navigate those things. And, and that's what we're there for too in those reviews is talking about, Hey, what's hard?
What are the decisions you don't want to make? And when is it time to rip that bandaid off? But it was a big learning curve for us as well. Cause we were like, I don't think we expected that. Wow. Almost every time we have a review. It means it's time for [00:18:00] this team to really switch things up right now with that particular team.
This has not been true for a majority of our teams or anything like that. So , that was a big learning of just Hey, this is a time for people to really disclose how it's actually going.
Shaherose: Yeah. So just for everyone to know that you came in, in these first two checks at idea stage, right?
There was,
Danielle: Basically, so yeah, the GIFs team was very early, I think they had maybe made some design mock ups of what they were doing. With Fountain, they had already been doing some hiring in the on demand, Sort of markets like Uber and things like that for a little while, but it was still the early days of the company
Shaherose:
And you do these company reviews. Tell me a bit about those. Are those frequent? We still do them?
1517 as Grand Central Station: Helping people get to their next destination
---
Danielle: Yeah. So I used to be a teacher. So this is all my teacher systems background coming into play.
I really enjoyed just knowing Hey, we're going to have an [00:19:00] onboarding meeting with people to talk about the expectations of being part of the fund and, kind of set our thinking. We're actually very transparent about how we think about things, and what our reasoning is and that's just sort of outlay that.
And that's what the whole team and then whoever is sort of the lead for that team relationally is the person who does reviews with them. Generally with teams, when they're at an angel or pre seed stage, we have on the calendar every other month, 45 minute to hour long call to just go over.
How's it going? What first do you have coming up? , I don't always ask this, but I've, I've been wanting to build this into the model. , but I often just open up with hey, how's it going? But I, I want to start opening up with, hey, if you're going to use three words to describe the last two months, what would they be?
But it's just this time to kind of brainstorm and talk about how it's going. I ask people personally how they're doing. if someone has huge bags under their eyes and I'm like, you're not sleeping.
Or we watch founders lose [00:20:00] and gain 20 pounds pretty regularly. It's like, Hey, let's talk about just how your life is. So we talk about all these different things and then as the company matures, as they hit seed metrics and things like that, we'll go down to once a quarter as they become a series a company, we go down to every six months.
And then once they surpass that stage, we do sort of like an annual check in to see how they're doing. Cause at that point they also have a support. of sort of a whole cadre of investors and advisors and so on. What's interesting is one of our advisors early on, she was telling me, she's like, Danielle, they're going to leave the nest.
Like they're not going to want to do these reviews forever. And I was like, Okay, like, all right, I'll, you know, we'll taper them down over time. Totally makes sense. But what was really interesting was that because we typically know our founders since sometimes even before the company starts, we become very trusted advisors.
And so founders will [00:21:00] come to us, they'll be like, wow, I just had my first board meeting and I got my ass handed to me. And I need to figure out what to do better. And we're like, Okay, cool. Yeah, let's talk about it. Or Hey, I'm having a huge co founder dispute. or, my personal life with my startup life is not working.
What do I do? So I've actually found that, even though from a formal review standpoint, you know, we might have , the touch point on a yearly basis once the company has matured, but we'll hear from those more mature teams fairly regularly, because they're like, there's a big thing that's come up in only you guys know the history of this company, and it's just such a special relationship to have in a special position to be in.
And then, in addition, when things aren't going well and things wind down, I like to have wind down meetings with my team, where it's like, one meeting we'll be like, okay, cool, it's time to wind things down, or maybe they've already been in a wind down process, and it's like, okay, you've closed the [00:22:00] company.
I personally like to have the next review or even the next two reviews still on the calendar just to check in of like hey, did you get that job that you applied for? Are you still looking for something? Let's get you with another portfolio company or something like that. It's been really nice.
I had a review with a founder the other day, who had to move on from what he was doing and he's working at a biofuels plant and he gets on the zoom, he's wearing a hard hat and he's just walking around. this space outside. And I was like, Hey man, how's it going? He's like, I'm doing the best work of my life.
I love this place. It's amazing. I'm making a real dent in the universe here. we are putting out, I don't even remember the number. It was like a gajillion gallons of biofuels a day. , it was some massive number and he was so happy. And, you know, we kept the call short and sweet because I was like, I don't want you to get in trouble for being on the phone at work here.
checked in about how his family's doing. And I was like, all right, [00:23:00] cool. Well, it seems like. You've got your spot. You know, I'm going to officially take these off the calendar for you at this point. I'm always here when I think of you all text and be like, Hey, how's it going?
I think it's, partially for me too. You just care about the people you work with and I want to know how they're doing. So that's how we think about the reviews and the reviews are also a lot like we, we say that we're Grand Central Station at 1517, where it's like, you're supposed to get on a train and go somewhere.
And often that train are connections, whether they're people that might be other funders that might be founders who are a few years ahead of them, who can give them some insight. It might be subject matter expertise areas. So we're constantly, especially on those review calls like, Oh, hey. You know who you should talk to this person and then making that happen on the call.
Shaherose: I love getting a view into how you've created such a culture of authenticity, collaboration, community for these founders. And that's been true of you from the beginning. You put founders first. And I think it's [00:24:00] so great to hear that from someone who sits in the seat of a VC because founders have different types of experiences.
And often all of us investors get painted as \ not very helpful. .
Danielle: Totally. I mean, and for good reason, I didn't even call myself an investor for the first three years of doing 1517. I would meet people and they'd be like, oh, what do you do? And I'd be like, oh, I work with startups.
Like I didn't, 'cause I didn't like the vibe of. the investment community. So I, we got to change that.
Shaherose: Yeah, no. And we've, we are changing it by being in it, right? People like you, people like me, people like, by the way, all the folks I selected for this podcast
are
true humans showing up and helping and believing in other humans.
And so that's the work that we're doing. It
Danielle: has been making a difference. I've really noticed over the last few years, really. I think people especially get that the angel precede people. are like, no, we're like [00:25:00] just people, and we're here to help people. And so I, I do think some of the viewpoints about VCs are changing because of the proactivity, of the sort of pre seed arena.
I also think that for the larger funds at Series A, there's so many funds overall now that funds know that they have to compete against each other on who's going to get that deal. And if you're a Series A fund and, you know, you need your large allocation target, your reputation is going to be one of the things that makes that deal happen or not.
So I feel like some of the behaviors are better because they know people are watching and talking and that. You don't just have to take money from the firm that offers it to you. you're probably going to have a few firms to pick from.
Shaherose: Oh my gosh, absolutely.
Hopefully you do. And, I was just on X talking about how when founders come on a call to meet a VC, they're in a sales process, right? But it's actually also the other way around, right? Yeah,
Danielle: it's totally.
Shaherose: Investors are pitching how, Yeah. We [00:26:00] actually are going to show up in the future. In the short first interaction.
Danielle: Oh yeah. I've heard so many crazy things were part of me is like I just can't even believe these things happen, Oh yeah, I know if it's a zoom Oh, I got on the Zoom call. And the VC showed up 10 minutes late just all kinds of I wouldn't call it necessarily bad behavior, but just unnecessary strange power plays and things like that. And,
Shaherose: yeah. Not great.
Danielle: Yeah. Not great.
Shaherose: Speaking of not great, let's talk about a worst investment of yours. and what you learned from it.
Lessons from the Worst Investment: Listen to your gut
---
Danielle: Yes. Yes. Yes. Yes. Gosh. So I will. Talk about two of them. So we had an investment that we made in fund one. And it's interesting because we had known the founder for a while. And honestly, the person kind of rubbed me the wrong way from the [00:27:00] beginning.
There was a lot of insecure attitude. And a lot of sort of old school, classic slimy salesmanship of like act now, otherwise the deal's gone, blah, diddy, blah. And of course this was also early in the fund. And so we were, you know, just learning about different norms and things like that.
We'd put a 100k check into this team and one of the reasons we did that initial check was because we had known the founder for a while and we were like, okay, maybe this person has learned and developed over time. And they did look like they had sort of developed what I would consider their core skills.
Sometimes people call these soft skills. I was like, okay, the person seems a little more authentic now. they seem to have an interesting business here. Maybe we'll do it. So we put in a 100k check and what was really interesting was everything became very transactional. you and I just talked about how relationally.[00:28:00]
Based we are and how that really works in this world. So when we would try to do, this is actually a really great segue from the last chat, because when we would try to do reviews with this founder, He'd cancel at the last minute. He wouldn't show up. And it was just really hard to get ahold of him.
And he always had this like, Oh yeah, I'm so busy. I'm so busy. Yet on Instagram, when we would be on Instagram looking at stuff, this founder would always come up traveling, being on the beach. And we were always like, This guy's in beach mode. we don't even know if he's really, doing the work part.
And so we didn't like being blown off and all this stuff, and then the founder raised a Series A round. And which was shocking to me and Sound Ventures led the deal, which is Ashton Kutcher's firm. It was our first company to get a markup. It was our first company to raise a priced round. And so part of us for me and Michael, we were like, wow, this is our first team [00:29:00] to make it to the big dog of next stages, not just a little more money, not just a seed round, but a series A round.
it's Ashton Kutcher's firm. there's some pressure to follow on there and be like, Hey, yeah, we follow on with our investments, but we were like, relationally, we do not like working with this person. And I remember I called one of the co investors. He was actually the guy we talked to. He, this other guy had made an investment in this founder before we had.
And we had known this co investor and we were talking to him and he was sort of the one who was like, Oh no, he's better now. Like he's learned and grown. I was like, okay, I don't know. But we were talking to this co investor and he was like, Oh yeah, I'm definitely, you know, I'm definitely putting in.
And I was like, I'm just not feeling good about it. every time we try to do a review. He'd never shows up and it's always hard to get at what's actually going on. And then actually what I forgot is anytime the founder did want to talk to us, it was cause he needed money. It felt very [00:30:00] parental.
It was like, Hey Mike and Danielle. Oh yeah. By the way, I'm raising a little more money right now. those were the only times he would talk to us. So it was like, okay, this is not good. Now, this co investor though, we're chatting about the Series A deal and this is something that is industry standard is VCs talk to each other.
People who are in deals together talk to each other, you're comparing notes. And especially when you like the other firms you're working with, you're like, Hey, I trust this person's judgment. It's kind of like, you can become like a larger team at that point. And so this co investor is like, well, how big was the check you put in?
We're like a 100k. And he's like, well, that's why he's not talking to you because your check really didn't matter. And I was like, I don't know. I just don't think you treat people like that. and even the fact that you would say that out loud, just to be already says that maybe you don't know what you're doing.
but he was, you know, trying to sort of like, I don't know, throw the founder bone or whatever. So the series A deal gets done. Thank you. We don't invest. And we don't have to explain to our investors why we don't invest or anything like that. [00:31:00] What starts to happen over the course of the next year is that the founder had stopped paying their employees at one point.
Things started going downhill, in part because they were claiming a partnership they had was revenue. It was a partnership with no money exchanging hands. So there was fraud at play. And then the founder couldn't pay their employees, so stopped paying them. And then the employees sued the founder.
And it became this many years long thing. And I've been through legal stuff before. Like when you have an organization and you're dealing with people, legal stuff happens. And I know what like a nice nasty gram looks like. And we got this nice nasty gram from like the employee's lawyer being like, Hey, if this doesn't settle, the employees might come after, like, might come after the investors. And I was like, Oh, that's a really nice nasty gram.
We don't have to do anything about this. Um, I stick it in a drawer. I'm like, you know, we're small check anyways. this is not going to affect us. The hilarious part [00:32:00] was like, I didn't even go to my colleague Michael to talk to him about this because I was like, oh, this is a nice nasty gram.
this is totally fine. a month later, he must have opened his pile of mail and he calls me and he's like, Danielle, we're getting sued. And I was like, what are you talking about? He's like, I got this. Letter from a law firm about the employees. And I was like, we're not getting sued. I was like, that's a nice, nasty gram.
You've just never seen one before. I was like, we're totally fine. And sure enough, we were totally fine. Um, we really dodged a bullet because yes, we put a 100k into the company, but we could have probably put in up to a million, that's our typical follow on strategy.
And we could have put in a million bucks being like, well, Sound Ventures is, and I guess we'll just follow the pack here, and we really dodged a bullet by not putting even more money into the company. More recently, we did have a company where one co founder decided to spend, company money on personal funds, and so we had to have a whole [00:33:00] conversation about Repayment to the company and that this is literal fraud.
I don't think the founder really understood that what they did is a criminal activity. And, uh, had to have some really hard conversations about that. And we've never seen anything like that. And we always tell our founders, we've seen everything. And I was like, wow, we got a new one here. You know, and I, I come from a learning and development mindset.
And so I was not angry with this founder. I was more like, okay, we have to remedy this situation. And I want to talk about what on earth is going on for you that this happened, because that's big. And two, this can literally never happen again, because if you did this anywhere else, you'd literally go to jail,
that whole situation has been remedied, which has been great. But was also a real learning opportunity too, cause there were multiple founders in this company. And the other founders were not, they didn't have checks and balances on their bank account. And so [00:34:00] they weren't really looking at what was happening and reconciling their accounts.
So now that's part of our onboarding. It's like, Hey, things we've learned over time. All co founders need access to bank accounts and to be looking at statements at the end of the month. because we would have caught this before it became such a big deal, if we had done that.
Shaherose: Wow.
Danielle: Yeah.
Shaherose: Yeah.
There are some nasty stories out there. These are definitely two steaky ones. And in the first one, it sounds like the lesson there is listen to your gut, right? Yes.
Danielle: Yep. And we did. We were like, all right, we listened to our gut. We did it.
Shaherose: It's so confusing sometimes when well-known names come in and say, oh, we believe, we believe.
And you're like, wait, what? I don't believe.
Danielle: Well, and part of me also is like that well known fun Never called any of the previous investors to ask, Hey, how's that going? And they never do. It really blows my mind that it's so rare that a series A fund will say, Oh, Hey, like you've been working with this team for two years, three years, four [00:35:00] years, less chat about it.
Almost never.
Shaherose: That's a good, that's a good insight.
Danielle: I'm like a lot of disasters could probably be negated.
Shaherose: Yeah. Okay. Let's talk about fun stuff. Best investments so far. Ideally one that you've realized. I do see that you have a company that went IPO. Yes. Yes. You have other unicorns, I think so.
So share as many joyous moments.
Best Investments So Far: Loom and Luminar Technologies
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Danielle: They're all amazing, and the standout ones are definitely Luminar Technologies. They IPO ed, late in 2020.
Shaherose: Congratulations.
Danielle: Um, it's been really amazing to be part of that journey from when they were five people in a garage in Orange County, to where they stand today.
The system that they've built, the autonomous driving system is shipping right now in Volvos. So that's really exciting. A
Shaherose: and they're a B2B autonomous driving system, so allowing other manufacturers to implement. Yes, that's, that's correct.
And that was the first check.
Danielle: Yeah, we, we were, they had had [00:36:00] some angel money, but we were the first institutional check into the company. So that was really exciting.
Shaherose: How did you find that team?
Danielle: So Austin was an old Thiel Fellow and the way we found him for the Thiel Fellowship was he came to a community event we had called our Thiel Summit where he just showed up one day and he was 16 years old, him and his mom.
His mom's amazing. And we just got to know them over time and then, , a year later, we were like, all right, he's going to be a Thiel Fellow and then he was part of the inspiration for starting 1517 because we saw where things were going and we were like, we have to have a vehicle to back this person, like, holy moly.
And yeah, it's been a, it's been a long journey, but it's, really neat. And, and, you know, just interesting to be part of the journey of what's happening in autonomous driving. , And it's funny, casually too. It's, I was just at a dance event and, uh, this guy was like, yeah, you know, I live in Palo Alto, but my car on the highway, can basically drive itself.
So I can go to a dance event, [00:37:00] Oakland and not even think about it. And I was like, Go autonomous driving. Like that's awesome. I'm just keeping, my minor part in that to myself, like, Oh, that's a cool win.
Shaherose: Was Luminar a fund returner?
Danielle: Uh, yes. A fund multiplier.
Shaherose: Mmm, can you share the markup for your fund?
Danielle: I think that can, I don't see why not. Yeah. Uh, with Luminar, I think it was like a 3.5 to four x on the fund.
Shaherose: Lovely.
Danielle: So that was amazing. Then we have our company Loom, that we were the first, institutional check. They've had a couple angels, but they're an asynchronous video tool that was used a lot over the pandemic. And they were acquired by Atlassian last year.
So that was, actually another, uh, multiplier of our fund,
which is really,
really great. We returned, we returned money around Christmas last year to our investors, which was really, really wonderful.
Shaherose: What a gift.
The Fund Formula: 85% dropout and 15% sci-fi
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Danielle: Yeah, no, really amazing. And then we've got a bunch of companies that are doing [00:38:00] just really, really well right now.
We've got a company called Zeno Power that is a nuclear battery startup, they're doing really well. What's interesting now with our third fund is we've invested in almost a hundred companies. So I'm like, who are our teams? What are we doing? there's a lot of them.
And it's really, it's quite exciting. We have a company called Trilobio, which is basically making automation robots for the lab. They're doing extraordinary work. We have a company called Rainmaker that people are kind of familiar with on the Twitter side because Augustus is quite a vibe in the Twitterverse.
But yeah, they're working on literally making it rain. Oh, and then actually we had a really big announcement. Like a week ago, one of our companies, Atom Computing, just partnered with Microsoft. And they're a quantum computing company. And so I'm very excited to see what happens.
They were our first big deep tech investment out of FundOne. That is a thesis [00:39:00] breaker for us. So we will sometimes break our dropout thesis in the name of science fiction. So if someone is working on something, that we would really view as sci fi, we're like, Okay. We will be an early check here. And we met the founder and this does not fit our dropout thesis, but this person is definitely working on science fiction.
So let's do it. It's been interesting because that company has been in existence for, I think, about six, seven years. And the fact that they're actually getting into partnerships with people on the quantum side is truly extraordinary. I'm like, wow, they are making really fast progress and I'm very, very excited to see what happens in the next 18 months for them.
This is a perfect segue to my next question, how would you describe how you're investing today, including the thesis breaker approach? And what does it really mean when you say I invest in sci fi?
Sure, sure. , so yeah, I'd say like 85 percent of our deals fit that dropout category.
And then during the end of fund one, which was almost seven [00:40:00] years ago, we noticed that we would have these very deep tech founders come to us and talk to us. And I think some of it is that accessibility part was we were just happy to talk to crazy scientists. We're like, okay, cool. let's talk about what you're doing.
And at the time. What we were doing was actually referring those people to our LPs. Cause we were like, okay, this person's on dropout. This doesn't fit our thesis. So we'll like kind of. farm stuff out to other people. But then like when we really thought like, you know, the way I think about it is kind of like, I love the whole solar punk future thing.
and, and truly in the sci fi realm of is this something that you might read about in a sci fi novel? That is kind of the litmus test there. If someone comes to us and they have a PhD and they're like, yeah, I'm working on AI and B2B SAAS, I'm like, AI bots are no longer sci fi.
It's just here. So it, typically has a deep tech component where there's an R& D component that needs to be done in the first couple of years. [00:41:00] Usually it's before they've even received any non dilutive funding, which is something important for deep tech founders to think about. And those founders tend to be something like 15 percent of our portfolio.
So though we call it a thesis breaker, it is a main part of our thesis now to do both of these categories. Another thing that's changed a lot is in our first two funds, we did about 40. Investments into teams with our current fund. We're doing about a hundred, like we're 90 something right now. And we will close that fund out with about a hundred teams that we work with.
And then the next fund will be about the same. So we're working with a lot more teams. Another difference is that we have an early angel check we do now, which is a 100k check to get people started, especially in the R and D realm. And then we do a 500k pre seed check when people are ready for that.
And then my absolute favorite between our portfolio theses are the dropouts who are doing the sci fi tech. those people, I'm like, let's [00:42:00] go. \ like I just get so much energy talking to them and picturing futures that, really like they're imagining and bringing to us.
Shaherose: And hopefully futures that are hopeful.
Danielle: Oh, a hundred percent.
Shaherose: Yeah.
Danielle: Very much so.
Shaherose: Yeah. I love it. So when you think about the majority of your investments. actually even the sci fi founders, right? And particularly again, and then the 85 percent of focus on dropouts, we're talking about really young folks with very little lived experience.
And we're talking about writing that first check where you have very little data, traction, proof of their ability to think and execute as well. So how do you make a decision on that first check?
Danielle: Yeah, it's really relationship over time. So a lot of times when we're writing a check, It's like, we've already known the founder sometimes for months or sometimes for years.
We might meet them through our grant program that we run. And then they might [00:43:00] come back later and say Hey, I'm starting to build something in the startup realm. And we're like, Oh, we've seen this person execute before. We've seen how they work with other people. They've sent us quarterly updates on what they're up to.
that's kind of cool. So, often the case is that we understand a lot of their characteristics before we're even making an investment. My colleague, Michael wrote a book called Paper Belt on Fire. We have a whole chapter in there about these characteristics that we look for. One of those characteristics, is really about sort of mission orientation, can this person really outline a large vision for like, What a 10 year future looks like.
But then, , we talked about, we are often holding these different polls at 1517, we'll also ask them well, what are you doing on Friday? what are you doing down here to get to here? And it's interesting because some people are really good at talking up here at the big mission area. And terrible at the what are you doing on Friday?
And some people are really good at the, what are you doing on Friday, but can't tie it to something. [00:44:00] So that's a specific trait that we look for, but it's really about understanding that trait over time in a human being and not just, Oh, this person had a good pitch meeting with us. Now, sometimes we meet people on a Wednesday and they seem to need a check on a Friday. And we've done those deals too, but those are more few and far between. And we much prefer to get to know people. And it's funny, I do a lot of mentoring and people are like, Oh my gosh, I can't believe you took your time out of your day to like, just chat with me.
And I'm like, listen, this is my favorite part of the day because there's no decision to make now. I just got to have a nice conversation with you and get to know you as a person. If I was just slammed back to back in like pitch meetings the whole time, it would be like, okay, now there's all this decision process that has to happen, which is actually, It's like high bandwidth work.
And, don't think it's good to just do back to back pitch meetings all day. So I, think of mentoring as sort of flossing and squeaky cleaning my brain a little bit, getting to know people. And [00:45:00] then later when they come back to me, I'm like, Oh my God, we've had five conversations before this person's fantastic.
And I love them. And of course I want to work with them.
Shaherose: Yeah, I love it. It's such a great way to de risk the investment. And I think like, to your point, like just get a. better picture of how this person operates.
Danielle: Right.
Shaherose: Can you share the list of characteristics you look for? And you, I assume even in these like mentoring meetings or getting to know you meetings, like you're looking for these traits.
Danielle: Sure. Absolutely. So yeah, the best way to get these traits, read Michael's book, Paper Belt on Fire. One of the traits I talked about earlier we call Friday Night Dyson Sphere. It's like, are you such a geek's geek that on Friday night, maybe your friends are out somewhere, but you're like, I'm digging in on this project.
that's something that we look for. One trait we look for, we call coat of many colors. And so that is this idea of, Someone who has lots of different interests and curiosities. Sometimes we like to say that we look for people who are two standard [00:46:00] deviations out on curiosity. So , sometimes my favorite questions to ask and to me they're just fun, but I'll be like, Hey, take me back to when you were 12.
What were you really interested in then? And people would be like, well, it's really dorky, but I am, I was super into magic, or I was super into mentalism, or I, I loved, doing magic tricks with card decks. And I was like, you're my people. So we, we just love seeing the breadth. of where people will go down some pretty intense rabbit holes.
There are anti characteristics that we have named as well, one of them is called the Cloud of Abstractions. These are people who sound really, really smart, and they're always talking like way up here, way over your head. but when you ask them about what they're doing, you can never get a sense. that there's a there.
It's just kind of, uh, hollow.
And there was a long time where, I definitely We kind of have some form of [00:47:00] imposter syndrome where me and Michael would be in a pitch and, we'd be sitting in our office in San Francisco and someone would be way up in the clouds on stuff. And I'd be like, I can barely follow this person.
And I don't know what's going on, but maybe it's me, is what I would think. And then the person would leave our office, and I would turn to Michael, and I was like, did you understand anything that they said? And he'd be like, I have no clue what they said. And to me, Michael is the most well read person I have ever met.
So I'm always like, all right, if Michael doesn't know what this guy's talking about, and he also has a great memory for all kinds of stuff, I'm like, if Michael doesn't know what he's talking about, then this guy really was way out in the stratosphere.
And yeah, so people where it's like, we can't figure out what's actually going on, that is a, that's a anti pattern for us. And yeah, I think we've dodged a number of bullets on that one.
Shaherose: Yeah, and I'm very familiar with that experience as well. Question yourself...
Danielle: it's weird [00:48:00] because you're like, this person sounds like they probably have like 165 IQ, but I, yeah. And part of it too is like, the social intelligence of like knowing like when is your audience with you and like knowing how to talk about something to different groups of people and sometimes what we'll say to founders is speak to us like we are the dumbest golden retrievers you have ever met.
Like we don't know anything. We did this with Ben from Adam Computing when he first came in and talked to us, you know, like six years ago. He said, what level of physics should I start at? And we were like, I don't know, like high school. And so he starts talking and in like two minutes, we were like, let's.
Let's go to middle school. Like, let's, like, let's bring this down. He starts talking at that level and we're like, hold on, time out. Just talk to us like we're dumb golden retrievers. because we are seriously not following. And he's an amazing teacher. And I'm totally biased. I love amazing teachers.
And [00:49:00] a lot of our founders are really good at teaching. Because I, think you have to have that ability to explain things to multiple people at different scaffolded levels. Because you're building a team, not every team member is going to know all the stuff you know, or you're going to have people who come in more, for different functions on the team, and it's not their job to understand, the cosmos.
You know, and it's their job to understand something that the founder doesn't get. So that ability to really explain ,you know, and being engaging and encouraging and not demeaning about it. that's definitely a trait that we look for. Across
Shaherose: the portfolio of investments, again, when you look at.
Whether it's the super young folks or the sci fi scientists, you focus on like a very specific set of people. I'm curious if they all have one thing in common, especially when I think of the young folks, is it that maybe they act above their age or they have unique life [00:50:00] experience.
Is there anything that just like, you're like, Oh yeah, almost all of them have this.
Danielle: So one thing I want to clarify is that though we have our thesis about dropouts, it's not about age. It's just about that dropout status. So we have people who are in their sixties who are dropouts. We've got people in their thirties who are dropouts.
We've got 15 year olds also, so it's across the board. But characteristics, one of the things I say about the people we work with at 1517 is that they're social geeks. they love to geek out about things with other people, and I think curiosity really comes into play with those people. They're also all extraordinarily mission driven, and to your point that you made earlier, a lot of it is often from life experience.
It's like, oh, this person's family was doing X, Y, and Z, and that's how they got really interested in it. We are very unlikely to back people who are like, I've always wanted to be an entrepreneur and I found this business case [00:51:00] and I'm going after it. okay, cool. Good to know. Like in that it's just not a fit for us because like our view is that you have to be willing to die on your sword for what you're doing.
Like you have to have that amount of passion about it. And that's another thing I would use to describe our founders is extremely passionate about their areas because we think that a business use case isn't going to get you through the dark night of the soul of like, everything's going wrong.
My co founder has left me, and I have to make a pivot. you're probably just going to be like, I'm done now, which is fine. I think it's fine and healthy to end things. But if you're going to get started, I think in startups, having that passion is a real advantage.
Shaherose: We've talked about this offline, but you do a lot of things to source. And I'd love just really quickly, like, how have you been finding these very special people?
Nurturing Young Talent: How Danielle sources next gen founders
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Danielle: Sure. We travel a ton. We go to campuses, we go to high schools. We talk to lots of people. We also do a lot that I think just makes us accessible.
we've become known for hosting ice [00:52:00] cream socials. I love hosting them. And so we just hosted an ice cream social in Toronto and we actually do have a fairly sizable community there, but. We like put it out two days before we were there. We only had three people show up, but they were awesome to talk to.
And they were great. And we all sat and ate ice cream together. And it was like, all right, this is really cool. And it's that random serendipitous aspect of our community is 5, 000 people, so we never know who's going to show up for something. And then when they do, and we're reengaging, it's like, Oh, this is
Really cool to get to know what this person is up to now. People refer people to us a lot. I often say that our community is what scales us and it's like those people are this hive mind. And I had, one of our grantees reach out recently and she was like, I met this 10 year old. He's amazing. You need to talk to him.
I was like, I'm totally down. And so I talk to this 10 year old. He's really amazing. He has some interests that align really deeply with some of our startups that are local to him. And so like, I set up a field trip day for him to [00:53:00] go be with this founder. And he spent all day with this founder. And then this young man came to our event and he's 11 now.
And I'm like, I can't wait for him to come to our teen camp in the future and I can't wait to give him a grant at some point and I can't wait until he's founding something because he's in that mode already and in a really positive way, not in the playing startup way.
And I'm like, yeah, I'm going to know Ian here. And that's his name, Ian. I'm going to know Ian here for a very long time. And it all started cause a community member connected us.
Shaherose: Wait, you have a teen camp?
Danielle: Yes. We just started running our teen camp last year. My heart swells just about it.
We invited 20 young people. to a camp in the bay area and we make it free for them to attend. They do need, we don't have the budget to do flights and stuff, but if they can get there, they don't pay for anything. We do a field trip day on Friday where we take all of them to our deep tech companies in San Francisco.
They get to see the cutting edge of a three to 10 person [00:54:00] team. We do a workshop day on Saturday and then we do an unconference day on Sunday. And we're doing it again in October and we've expanded it to 30 teens. And at some point we're going to have to make this into a hundred teen event.
all the applicants are amazing. And I'm always like, Oh, how do we, like, I don't even like the idea of picking between these people. I just want to make it open, just come to this. But yeah, it's been really fun. And we've seen some awesome cross pollination where the founders that they've met, they've kept in touch with, and then sometimes interned at their companies.
Some of them have become grantees. We've been close to writing a couple of them investment checks. Not yet, but I know it's going to happen. It's like, it's just a no brainer at this point. And gosh, they are just, they're so kind and they're so smart. I have such hope, for the generations coming up because gosh, they just have amazing skills.
Shaherose: Thank you for Thank you for nurturing them. And if you're doing this in 10 years, I'm signing my son up.
Danielle: Oh yeah, sold, sold
Shaherose: Okay. We're, we're, I'm looking at the clock, but just for the audience, [00:55:00] your grant program, just real quick.
Danielle: So the grant program, we give people a thousand dollars to work on a project.
It's not a startup grant, it's not for getting a company off the ground. I met with a young man yesterday who's like, I'm obsessed with light bulbs and sort of recreating how people do lights in their home. And I was like, cool, you're getting a thousand dollars. And I went over to actually, we gave him the thousand bucks a couple of weeks ago and I, I went to visit him, and see what he's been working on, and he got so many LEDs. I was like, wow, holy moly. I just heard from an old grantee, earlier this week. He's like, Danielle, do you remember me? I'm the one who is working on the 10 foot unicycle. And I'm like, yes, like, this is what I love to give the grants to is just pure, pure projects where people really want to.
imbue a passion into something that literally has no reason for building other than they just want to. There has to be that like fun component. We had someone who built a robot squirrel. So like, it's been really [00:56:00] fun to see what's come out of it. What's been interesting is sometimes those grantees in quick order are like, Hey, I think this thing I'm building could actually have startup potential.
And then we're like, Okay. and it's funny, we don't push them in that direction. In fact, sometimes we've tried to discourage people from that direction. And they're like, your discouragement showed me that I really wanted to do it in the startup direction. So now I'm doing it.
one of our companies, DeepGram, which is a series C company, we had discouraged the founder, but he had been a grantee. We discouraged him. We're like, Oh, I don't know. maybe this should just be a project. And he's like, He wrote me this handwritten letter years later. He's like, Danielle, that moment where you guys told me that maybe I should just go to grad school and like, he's a physicist.
So he's doing all kinds of interesting things in that realm. we're like, we don't want to take this guy who's supposed to discover the mysteries of the cosmos away from that. And he's like, it was that meeting that I knew I had to do it. Cause you guys are telling me exactly what I didn't want to hear.
And we were the first check into that company also. So that was kind of wild. But then sometimes the grantees will come [00:57:00] back, Seven or eight years later, this has happened now. And they'll be like, Hey, remember me when I was a wiley high schooler and now I'm building autonomous robots. And we just back to that company.
So it's, it's really cool to see over time how these things evolve, but we love the grant program. We call it the Medici project. There's no paperwork. There's no, we own you or your stuff. It's a pure gift to people. We don't collect receipts. We're not like, Oh, we have to know exactly where it all went.
And we have a lot of fun with it. And we have a lot of fun imbuing that trust to young people.
Speed round
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Shaherose: Wow. You are doing things so differently than any other venture fund I know. And you're truly fueling the world's creativity. Yeah. And I love it. for doing this. in, six minutes, we'll do as many speed round questions as we can.
Besides reps, how do you get better at investing?
Danielle: This is a hot debate on our team, because now that we've been going for 10 years, we think [00:58:00] we've learned something. And it's hard to know when your learnings are applicable or when your learning is getting in the way of just letting your gut make a decision.
So we're still sorting that out right now. But yeah, I think one way you get better at investing is by spending lots of time with founders as they're developing things and spending time in your portfolio, spending time with those founders and getting to know them and learning about what they're doing and how they're doing it.
Cause you can pass those learnings onto the new founders you work with. And it's like sort of, making the whole group rise at the same time. So that is one. Another way that I think you become great at investing is actually getting your founders together. So we do a lot of community building between our founders because they have a lot of knowledge share that we'll never know how to share with them, but they share with each other.
Shaherose: Love it. In a few years, in 10 years, you're on the Midas list. What got you there?
Danielle: That's really good. Um,
Shaherose: We've had some people say they don't want to be on the list.
Danielle: Well, I have two [00:59:00] answers. One of them is that I think Stark Therapeutics, which is a company of ours that's working to cure diabetes. I think they'll definitely get me there. The other is this very alternative thing I want to do where I want to fund artists with our Medici grants, but not through 1517 as a personal project and see some of them just crush it and be like, Oh, cool.
I helped find somebody and Give some money and resources to someone who became a really great artist. that's, something I'm scheming on right now.
Shaherose: Oh, I like it.
Who is another First Funder you admire?
Danielle: Um, I gotta go with my old boss, Peter Thiel. He's pretty amazing at what he does.
And he does a lot in that guttural, instinctual, like, Yep, we're just going for it and doesn't look back
Shaherose: And we didn't even get to talk about him. It's okay, this is all about you What is a book or piece of media that has had a major impact on how you invest?
Danielle: Yeah, we have a whole recommendation book list that I can send you.
But, Amanda [01:00:00] Palmer's The Art of Asking book is amazing, and it really helped us to think about how we built culture and community at 1517.
Shaherose: Ooh, can't wait to read that one.
Danielle: It's so good. It sounds great. And get the audiobook, because she reads it, and oh my god, it's incredible.
Shaherose: Zoom, phone, or in person meetings?
Danielle: In person.
Shaherose: Yeah, social media platform of choice?
Danielle: Twitter.
Shaherose: Alright. Thank you for joining us today. Where can people find you online?
Danielle: they can find me in email, danielle@1517fund.com. They can find me on Twitter, dstrakman.
Shaherose: That was such a great interview. Thank you, Danielle, for taking time. I wanted to share some quick takeaways. So you can see how Danielle has launched a fund. On top of an existing platform and community, which means her focus is super sharp. Obviously she invests as a generalist and yes has some focus on deep tech and Sci-Fi, but [01:01:00] ultimately she has a focus on a specific founder type.
And I think for emerging funds, It's a great strategy to build on top of an existing focus or a community that really makes you stand out so that you can become known for something I think Danielle has done a great job of zeroing in on her experience at the Thiel fellowship, leveraging that network building on that network and really becoming the go-to fund for dropouts. And folks who are doing Sci-Fi and wild things on the edge.
And so, , she's become known for something very specific. And I think that's a very successful and thoughtful strategy as an emerging manager. And an emerging investor, same sort of takeaway goes for, if you're an angel
Another takeaway I was left with was the reminder that tech has always lived in the future. And Sci-Fi was really the vision of the future. 10, 20, 30, 40, [01:02:00] 50 years ago. And a reminder for me to get back into Sci-Fi.
I was into it as a kid, but I feel like I've gotten so business focused that I tend to forget the creative thinking that can happen. And recently saw an article. About how people are now leveraging the subconscious mind in deep dreams to make decisions. In the future. So, felt like very scifi reading minds. I was also at a dinner lately where we all felt like there hasn't been new Sci-Fi in the last while that has captured our attention.
And we feared that the creative spirit hasn't been as fanned as it used to be. So personally I would love your scifi recommendations to sort of take us out of our day-to-day because it feels like the last generations of scifi have now become reality. Right? We've got intelligent machines, flying cars, friendly robots. So we'd love some recommendations for new Sci-Fi that takes me even further into the hopeful [01:03:00] future. And the last takeaway was how Danielle uses mentoring as a sourcing strategy.
I think the idea of, oh, I've talked to you three or four or five times in the last three or four or five years. Is a thoughtful way to get to know someone over time. And I think the advantage in investing in someone who you've known for a long time is clear. And for Danielle even more important because there isn't a track record or work experience to go off of given she's investing in such young folks. So I love that takeaway of just remembering that even as an angel or as a VC. Mentoring is a sourcing strategy. it's all about the long game and all about the long-term relationships. That's it for me.
Hope that was helpful for you and hope to see you next time.
Danielle: [01:04:00]