March 6, 2017
Investor Profile: Parul Singh of Founder Collective

Parul Singh is a Principal at Founder Collective in Cambridge. She joined the firm last September, after running her own startup called Gradeable. This isn't her first position in venture capital or at Founder Collective, as she worked with the firm while she was attending business school at MIT Sloan.

Singh recognized very early on in her career that she had a passion for startups, which has carried her through out her career. Whether it is being a founder or an investor, she's had the opportunity to learn through a variety of experiences.

Parul Singh, Founder Collective
Parul Singh, Principal at Founder Collective

Nina Stepanov:  Tell us about your background.

Parul Singh:  I grew up in the Boston area. My family moved to Canton because of the public high school’s math team, which in retrospect is hilarious. You can’t get nerdier -- I was literally the captain of the math team.  Incidentally, we were the top team in the state and New England for at least 12 years in a row.  I was a total geek, but I also played a ton of sports too, I played tennis, field hockey and ran track.

NS:  Why did you go to Harvard?

PS:  I remember learning how to code for the first time in 5th grade when I was 10 years old. I took AP Computer Science in high school and loved it, but I didn’t really know what that could lead to in terms of a career. I got into both Harvard and MIT, but I decided I wanted the liberal arts experience. I thought I could get a really high quality education in computer science as well as explore public policy and creative writing at Harvard. I thought I wanted to go to law school at the beginning.

While I was there, I started to get more involved in entrepreneurial things. I was very involved in a handful of student organizations. My friends and I started a leadership conference for high school students and during that time I realized I loved organizing people and building things together. Then as it turned out everyone I talked to who was a lawyer hated it and it seemed like something I wasn’t going to be passionate about.  So, without a long term plan, I took a year off from school because I thought, I’m paying so much for college, I should know what I’m doing with my degree.  It was the best decision for me!

On my year off I got an internship in London using the only marketable skill I had which was coding. I was designing a database for this giant company, which seems random and boring but it was exciting to be in London. I realized that I loved creating essentially a mini product for them to organize all of their contacts.  I did that for a few months and once I exhausted every possible feature that I could add for them, my boss ended up trying to find something for me to do. He recommended me to a startup he had invested in that needed help with their database. It was my first time working for a startup and I loved it. I ended up building them a call management application from the ground up. I was 20 years old and way out of my league but I was having so much fun. The founder was amazing and a little crazy and gave me an incredible amount of responsibility.  I thought he was amazing and it was awesome to build something tangible with a small talented team. I learned a lot from that experience and decided to go back to school.

One more thing about that year - being out of school was eye-opening.  All my peers in college were talking about consulting and banking or grad school, which were lucrative and predictable careers, but I was into technology. It was in the tech boom before the dot com crash and everyone in the real world was talking about the internet, so I went and started an online magazine with a group of friends called Icon Magazine. Icon was like an art exhibit: we would pair up writers, designers, and developers and design an interactive experience for every single story.  One of the projects entailed an artist taking trips on the Red Line and recording snippets of sound so you could click on different areas on the map and hear a recording of what they sounded like. It was intense and fun. I met a ton of interesting people.

NS:  Talk about the early years in your career at Razorfish and the NY Times.  How did that experience lay down the foundation for what you’re doing now?

PS:  I ended up working for a digital agency after college -- with perfect timing... I graduated right into the dot com crash. The agency where I worked was amazing and quintessential of the startups of that era.  Our office was a mix of these incredible interaction and UX designers, but there were also a lot of people who were really experienced in building huge complex software systems because of the acquisition of a Cambridge-based systems integration firm. It all made me realize just how much I had to learn. I then went to New York to work in publishing and media for a while. I worked for Fast Company and Inc. Magazine, who were acquired twice in the time I was there.  I went from being the youngest, most inexperienced person on the dev team to running the tech team.  Then I jumped from programmer to product management at The New York Times and learned a ton during a very challenging time for the online news business. The paper was struggling to find business models that worked online, so I had the opportunity to try a lot of cool projects. For example, I pitched to senior management to post videos from The New York Times on YouTube (which was a nearly unknown startup at the time) and I got to do diligence for our investment in Brightcove (I said invest and we did!).

Looking back from where I am now, I can’t imagine any other job where it’s so much of an asset. I had the opportunity to do so many different things (media, adtech, analytics, SaaS, and edtech). Especially at our fund where we look at so many diverse opportunities, having experience in many different areas gives me insight on all types of companies, from analytics to ad tech, developer tools to consumer product companies. I can talk to people from very different backgrounds and have the context to get up to speed quickly.  I also love the fact that my job is different every single day.

NS:  How did you end up at Visible Measures in Boston?

PS:  My vertical at The New York Times was not profitable, so I came back to Boston to work for a startup called Visible Measures. I still felt that I wanted to start something myself someday, so I wanted to get closer to that. I had learned a lot in a big company environment but I didn’t love it.  I wanted to work in startups, so I got very involved in the Startup Leadership Program. I ended up running it in Boston and helped them expand to New York, San Francisco, and now the network is all over the world. I met some of my best friends in the program, all startup founders and it all really cemented my desire to work with early stage companies and people. We had a stream of experienced entrepreneurs come in and talk to us. I connected with their stories and that desire to break things, try new things, or fix things.

NS:  Why did you decide to attend MIT Sloan for your MBA?

PS:  I thought I should learn more tangible business skills so I could be more prepared to run a company. I applied to MIT, which has a very entrepreneurial reputation. A month in, I met a fellow student who had similar interests and we started constantly brainstorming ideas. Somehow I became known as the startup person in my class.  I helped a friend who was transitioning from consulting to startups prep for an interview at HubSpot. He got the job, and later he introduced me to Founder Collective where I worked with Eric Paley and David Frankel. I spent a year working with them while I was in school and got to see what an incredible vantage point it is being in venture capital.  Around the same time I started a summer program with some friends called the Lean Startup Challenge. We built an 8-week program where we matched companies with coaches. They would work together iterating their product and getting their MVP done.

I had an incredible experience at MIT Sloan and got to take a lot of risks and try new things.  Early on, I told Bill Aulet, the head of the entrepreneurship program that there were gaps in the product management classes offered. He told me to fix it, so I wrote a syllabus and he recruited Brian Halligan and Paul English to teach what became a brand new class.  I have a tendency to speak up if I see something which could be better and this usually earns me a lot of extra work, but I still do it.  I love problem solving in that way.

NS:  You were the founder of Gradeable, an edtech startup.  Can you share more background on the company and what you were trying to solve?

PS:  While I was at MIT, I started working on the idea for a company that would provide an alternative to standardized testing. I felt that testing was such a frustrating experience for so many people and the only reason it’s done the way it is now is because the current system is the only way you can get data from a lot of students very quickly. So we built a software system that would let you collect data from other types of work from students, such as essay questions, projects, and so on. I believe you should be able to write a proof or a poem, or do project based learning instead of filling in bubble sheet circles and that would allow for more types of diverse learners. We also thought that if we could make it easy to give feedback to students then schools would offer it as an alternative.

We were lucky enough to be part of MassChallenge and LearnLaunch accelerators. LearnLaunch was very helpful because it helped connect us to investors who cared about edtech.  It was also great to have a group of mentors who knew a ton about the business side of edtech. A few of the investors at LearnLaunch personally invested in Gradeable, so did my family and one of my professors.  We launched and built the product over 3 years, because it took us that long to figure out how to package and sell it -- to find product market fit. We were long out of money and then we got our first customer, Teach for America. We launched a pilot across the US and got our first big district as a customer as well. But it was hard to constantly run out of money, especially because it took so long to close deals.  Even when everything went well and our customers loved us, it still took 12-18 months to close because of their internal processes. It could take more than 12 months to get them to actually sign a sizeable contract.  We ended up deciding that it was taking too long to grow, but in the meantime I’ve been fielding a few requests to license the technology to some partners.

NS:  Coming back full circle, how did you end up back in venture as a Principal with Founder Collective?

Founder Collective Team Photo
Founder Collective Team Photo

PS:  I was still wrestling with trying to make school sales work when Eric reached out to me last summer and encouraged me to apply for a full-time role with the Founder Collective team.  I was excited to get a chance to work with him again, as he had been an incredible mentor and I had hit a brick wall with Gradeable, so it was fortuitous timing.

NS:  What stage of investments do you primarily target?

PS:  We’re purposefully stage-focused and sector agnostic. The stage-focused bit means we only do seed stage investments ($500K-$1.5M is typical) and don’t participate in later rounds. We like to join a company early and then dilute along with the founders. We feel that this makes us as aligned as we possibly can be with our founders.

“Sector agnostic” means that we don’t have “themes” that we invest in like SaaS, social networks, etc. We feel that that gives us the opportunity to look across the board and find cool companies before they become the next trend. For instance, there is not theme that would have predicted Uber, BuzzFeed, and The TradeDesk, yet we’re very happy to have this diverse set of companies in our portfolio.

The line for where seed stage is has changed a lot over time. When we first started, we were one of only three seed stage funds and now there are well over 300. It gets less and less expensive to start a company, so we’re often not the first money into a company anymore.  Many founders have gotten a pre-seed round, are bootstrapping, or have raised friends & family money and have used that to get positive early traction. The most competitive seed deals that we look at look these days are probably analogous, in terms of metrics, to a Series A of five years ago.

Just as an example, in three recent investments we made in the last few months, the founders were repeat entrepreneurs who had bootstrapped or raised angel money to run for about a year, and had anywhere from 10 to 10,000 customers signed up for their product already.  What amazes me is the quality of the entrepreneurs out there, their increasing sophistication and their scrappiness in building something lean.

It’s not that we don’t value really early, pre-seed deals -- we invested in Periscope before they launched, and they later sold to Twitter.  But they made their case through an extraordinarily compelling product.  It’s a competitive process.  I’m personally looking at 100 startups a month and our firm ends up investing in about two.

NS:  What are the top traits you look for in terms of investing into a company or founder?

PS:  We really care about founder-market fit. It’s so compelling to us when the founder has a personal connection to the industry they’re in. We backed one of the top 10 baristas in the world, Kalle Freese who invented 3rd wave instant coffee. Very few people could have started Sudden Coffee. Likewise, TJ Parker of PillPack is another great example of founder-market fit. He’s a 3rd generation pharmacist who took this user-friendly mindset to build one of the fastest growing companies in the area.

Other advice for entrepreneurs who are pitching us:

  • We love founders who are metrics driven, not in a simplistic way, but thoughtful about growth as well as aggressive.
  • Team is so critical too.  You very rarely build a huge company by yourself.  Some entrepreneurs have this go-it-alone mentality, but the faster you get over that and realize that you need division of labor and that you need an amazing team, the faster you’re going to progress.
  • Also, we like to see founders who are focusing on use cases, not platforms or trends. If someone has built a technology that can be applied to half a dozen industries, it likely means they haven’t really figured out product/market fit.

NS:  What sectors of technology, industries, or trends are of interest to you?

PS:  The only common characteristic for our companies across the board is technology.  But we don’t do life sciences or medical devices.  I personally love enterprise SaaS, eCommerce, analytics & developer tools, and ideas that are a little out there.

NS:  What is the current fund that you are investing from?

PS:  We’re still investing from fund two and sometime this spring we’ll start investing with fund three.

NS:  Which investments from Founder Collective are you involved in?

PS:  I’m currently supporting all 3 partners with diligence and meeting with companies. I worked a lot on WorkJam (funded in January) and on Blissfully (a great team of entrepreneurs we had worked with before, and Aaron whom I’ve known for 8 years). I’ve also been spending time with the incredible team at Kuvee, who you will be hearing more about soon, because they are incredibly smart and bringing up an entirely new generation of savvy wine drinkers.

NS:  What companies outside of your portfolio in Boston do you find interesting?

PS:  I’ve been super impressed by LearnLux, where Rebecca Lieberman has built something very compelling. I also love Armoire, which is a professional women’s clothing rental service founded by a group of recent MIT grads led by (no relation) Ambika Singh.

NS:  Who do you admire or who has been the greatest mentor for you?

PS:  In venture, I would honestly have to say that Eric is one of those people and that’s why I’m here now.  Both when I worked at Founder Collective as an associate and in between when I was building Gradeable.  Our fund doesn't do a lot of K12 technology for schools but he was always really supportive of me and that was a huge reason that I came back.

I’ve been so lucky, there are so many people who are willing to help and be very supportive. Jean Hammond was one of my investors and has been incredibly helpful as well as Bill Aulet. Also, I am incredibly grateful to Anupendra Sharma who founded the Startup Leadership Program.

Angel investors are a special breed of people.  Just getting people to write you a check when you don’t have any customers or a product and having these people be willing to give you a lot of money to sort of try something while all the while believing in you. It’s an amazing thing that people do that.

NS:  Outside of being a VC, what are your personal interests or activities?

PS:  I love yoga and running. I did a triathlon a few years ago and I’m thinking about doing another one. I have 2 children under 3, which is a big commitment of time (although one I’m very happy to make).  I’m already plotting out how soon I can teach them to code.  My husband is an educator and leads a public school in Somerville. He’s always telling me I have to pace myself and let them grow up, but I’m very impatient.

NS:  Anything else you’re doing outside of your day-to-day?

PS:  I’m involved with the NEVCA and am on a team helping plan events for young, up-and-coming VCs.  I’m hoping to mentor again for Technovation, which I have done in the past, and absolutely loved.  I’m also still involved with education reform causes.

NS:  What type of music do you like?

PS:  The first album that I ever bought was The Beastie Boys.  I’ll try to claim some street cred because of that.  But my sister was looking at my iTunes this weekend and making fun of me because the last album search I ran was for one of the Sesame Street albums.  So..

NS:  Anything else you’d like to add?

PS:  I’m probably a really great example of not having had a plan but ending in a place that I really love. I have always been in love with startups and building stuff. I could have never predicted where I’d end up but I love being here. I’ve always tried to filter for what I really love, spending time building things with the people I want to spend a lot of time with and that has lead me to where I am. At 20 years old I knew that I loved startups and building things and that’s what I’ve stuck to.

Nina Stepanov is a Contributor at VentureFizz.  Follow her on Twitter: @ninarstepanov.