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๐ŸŒ Supply Chain and Venture Capital: A Unique Journey ๐Ÿš€ | Courtney Lipkin


Summary: Courtney Lipkin, a partner at Susa Ventures, shared her journey into venture capital on the Supply Chain Innovators podcast. She started in law but transitioned to academia and urban planning at Stanford, where she got involved in the entrepreneurial community. Her roles at accelerator programs exposed her to the challenges faced by founders, especially in fundraising. Courtney leveraged her extensive network to enter the venture capital world, initially at First Round Capital, and eventually joined Susa Ventures. Her background in urban planning aligned well with Susa's focus on industries like supply chain, which are large, under-penetrated by technology, and slow to adopt innovation. This transition was a natural fit, allowing her to bring her expertise to the venture capital space.




Before we dive in, can you give our listeners a brief overview of your journey and how you arrived at your current role as partner?


I had a little bit of a unique journey into venture, which, you know, as I've learned over time is actually more typical than some people might believe, but I actually started my career in law. I thought I was going to be a lawyer after undergrad. I worked for a couple years at a litigation boutique in New York and realized I liked the investigation part of that field but didn't love interpreting case law.


So rather than going to law school, I actually went to grad school and was on more of an academic path hoping to pursue a PhD and I was studying urban planning policies.. in developing regions and particularly in Chinaโ€ฆ. I was in grad school at Stanford and at Stanford it's a very entrepreneurial campus and community and I was lucky enough to be exposed to some organizations on campus that supported founders while they were still in school. So I started working as a volunteer first at an organization called StartX, which is an accelerator similar to Y Combinator, but just specifically for the Stanford community. And then after a year at StartX, I actually joined a very early team that built something called Cardinal Ventures, which is an even earlier accelerator program on campus that was serving students still enrolled at school, because StartX actually required you to be full-time on your company, because it was a real accelerator program in the true sense of funding. And so at StartX and Cardinal Ventures, I found myself in these operations roles, which are really exciting because my job was to bring services and opportunity to the founders and the programs. And I didn't know very much about entrepreneurship before those roles but the day-to-day of sitting down with founders and them coming to me and asking uh... I need help with recruiting, I need help with marketing, and of course the big one I need help with fundraising. It was the best masterclass of, how do you get these very high quality energetic founders into the funding ecosystem as efficiently as possible. And so I was in grad school for one thing, but I ended up getting a graduate degree in something else while I was at Stanford. And being a node in those organizations allowed me to get to know a lot of venture capitalists that came to campus and asked me what are the most exciting companies coming through your programs and how do we get in touch with them? And so I was lucky that I got to know about 70 funds or so over the course of those two years. And then as I was thinking about the type of career I wanted and the impact I wanted to have, I felt like there was no better way to do it than in helping support these new technology companies coming into the ecosystem. That's when I made the transition to working at a venture firm.


So it brings me here today... I started out my venture career at First Round Capital, I was there for three years. And I love the seed stage, very early work with founders before the company is really up and running because there are a lot of interesting problems to solve. And then at First Round, we actually co-invested with a number of seed funds, including Susa. And one of our co-investments is actually Flexport in the supply chain space. And so I got to know my now partners over the course of several years. And they were just building a fabulous platform for really early founders. And so when Susa raised what's now our third fund in 2019, there was an opportunity for me to join the team. And so that's when I hopped on board and it's been great ever since.โ€



Was there a learning curve from moving from First Round to Susa?


Yeah, it's a good question. First round is definitely a pure generalist fund. And then at Susa, we are generalists in some ways, but we have areas of expertise, sort of like majors, if you will. And it was actually a natural transition for me, because as I mentioned, my background is in urban planning policy. And so I like to think about big systems at the city level or county level. Honestly, urban planners think about supply chains, transportation, the physical environment, real estate and construction. And so that was already a clear area of interest of mine and also an area that I've done a lot of research in. And so at Susa, I do focus mostly on these sorts of, I guess you call them dustier industries, literally and physically, the types of industries that are very large, relatively under-penetrated with technology, but that they take along time to adopt new behaviors.



Now let's talk supply chain technology. Tell us about some of the investments you've made in this space and what do you look for when investing in companies?


So at Susa, like I said, we've been active in supply chain really since the beginning of the fund. The first fund we raised was in 2013 and then we invested in Flexport in 2014. So since then, investments will sort of generate more deal flow and more connectivity within a network. And so the Flexport investment certainly did that for Susa. So beyond that, we've invested in a company called Stord, based in Atlanta.


We have another investment in a company called Loop, which is doing payments for a supply chain. And then we have a couple of unannounced logistics investments. One is helping shippers with an email plugin to make their workflows more efficient, another kind of more on the procurement side of things. But we look for founders who like I said understand the industry but also have enough of the kind of momentum and technology DNA to be able to build quickly hire well for both the industry expertise and the technology expertise and can also be good fundraisers because when you make the choice to jump on the venture funding treadmill there are specific milestones that you typically need to hit in order to continue capital

your business. And so the venn diagram for founders who understand supply chain and have spent a long time there and then also understand the nuances of the tech and venture world, it's not a very large overlap and so we do look for those individuals.


What excites you about the supply chain technology space in general?


I think the most exciting thing for me, as I mentioned earlier, is that it's still relatively under-penetrated by technology. And I think a lot of people who aren't familiar with these larger foundational industries don't really understand the scale of the opportunity. And so what excites us at Susa is that you can take a very small part of the market and make a large software business out of it if you can serve a customer well.


And we're starting to see the decision-makers, the buyers within these more legacy businesses, turn to technology and be open to putting budget towards new software systems. And of course, in the last year, the conversation around AI has exploded. And there's a lot of excitement about the efficiency that AI can bring to some of the more repetitive manual processes in supply chains. The opportunity is massive and we've only just scratched the surface really.


Can you go a bit deeper into the process: when you're scouting for potential startups to invest in, what are the key attributes or qualities that you really look for?


At Seed, we are investing in a team because ideas can change quite a lot. Actually, once you get going and you are building a product and you're selling it, you're diving into your customers needs. And so what we look to back are the teams that can make those quick pivots, if needed, and are deeply empathetic to their customers' needs, but also have a point of view about how technology can be applied to those needs. And also that they just move very quickly towards their goals.


What types of opportunities are you looking to fund in the supply chain space?


Yeah, we don't necessarily have really niche perspectives, but I think there is a lot more work to be done on the shipper side of things, and particularly for the long tail of shippers who might not be able to just because of budget and volume negotiations with some of the larger regional or national carriers.


So if there's a way to bring some of that big enterprise efficiency to the mid and small size businesses, I'm very interested in that.


The pandemic showed us that all of our online purchasing is not going away anytime soon and small businesses I think still need more support in their supply chain operations. So that's an area that I'm interested in. And then of course, applications for AI across all different functionality and I do think that we're still searching for the areas where startups will have an advantage over incumbents like a Stork or Flexport, for example. Incorporating AI functionality into their platform, that's relatively easy for established players with existing workflows, existing platforms to do. And so we're thinking about what are the different areas where a startup might have a real advantage over an incumbent.


And to be honest, it's TBD. We're hoping that a founder would tell us, given their unique insight, where those openings are.


For supply chain technology founders looking to raise funding, what is your top advice you'd have for them?


Well, I think in this market, the way that venture has shifted in the last 12 to 18 months after the kind of explosive growth in the industry and then everything coming back down to earth, I think supply chain founders should be very specific about the investors they target when they're running a fundraiser process. Because like I said earlier, not every investor is going to have a real appreciation for the scale of the market, the opportunities available, and also the complexity of the opportunity in terms of go-to-market building teams and the entrenched nature of incumbents. And so what I tell founders in every industry is you don't necessarily need to just talk to specialist investors, but you should talk with investors who have a demonstrated interest in your field and where you don't just sit down in an initial conversation and have to spend the entire time educating them on the market. Because right now I do think the venture industry is sort of going back to a little bit more conservative model where investors want to really deeply, deeply understand the opportunity, spend weeks with founders rather than running processes that last five or so days at seed, which is sort of the peak of 21 frenzy. In order for founders to use their time well, because their time is extremely valuable, targeting specialists, with demonstrated interest in supply chain, I think is important.


Going back to you, what about people that are interested in getting into venture capital? Do you have advice for them since you didn't take the straight and narrow path?


โ€ฆI didn't use to have advice about this because I thought my journey was a little bit of a fluke. But now as I look back, I realized that what happened with me, what can happen with anyone.. I was in a network that was a very generative network for entrepreneurship at Stanford. And I happen to be a node in the network because I was in these operational roles in accelerators that were serving the Stanford community specifically. And so if you want to get into venture, particularly at an early stage, network is everything. And you can generate the network. You don't have to come with it pre-packaged.


I went to this school or I worked at this company, you can slot yourself into these ecosystems, but you, you should be deliberate about it. I think the more you can build connectivity around yourself, either professionally or educationally or through, you know, podcasting or writing or whatever it is, that will help you bring value to a fund that's looking to expand their network in different areas or maybe wants to double down on a particular industry or geographic network or alumni network that you have.




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