In this episode, Mike Gardon chats with Patrick Klas. Patrick is an investor with Maschmeyer Group Ventures (MGV). MGV is a seed stage fund located in San Francisco primarily focusing on InsurTech and Fintech. Previously, Patrick was a founding member of American Family Ventures (AFV) where he helped deploy over $300m across 100+ insurtech and fintech deals. Patrick also served as the Head of Operations for Bunker (an Insurtech startup located in San Francisco) where he helped to raise their Series A round as he gained operational experience. Patrick lives in Oakland with his wife and graduated from the University of Wisconsin. He enjoys fly fishing around California and learning to surf.
IN THIS EPISODE, YOU’LL LEARN:
- Patrick’s background
- The skills Patrick learned in his first job that still benefit him today
- Patrick’s career track
- Skills necessary to succeed in venture capital
- What it actually takes to break into a venture career
- Patrick’s predictions for the future of remote work
- How COVID impacted Patrick’s career
HELP US OUT!
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BOOKS AND RESOURCES:
- Analyst vs associate
- Skills necessary to succeed in venture capital
- Book: Venture Deals by Brad Feld
- How to create a meaningful network
- Connect with Patrick on LinkedIn, Twitter and Clubhouse.
TRANSCRIPT
Disclaimer: The transcript that follows has been generated using artificial intelligence. We strive to be as accurate as possible, but minor errors and slightly off timestamps may be present due to platform differences.
Michael Gardon (00:04):
Patrick, welcome to the show. How are you? Great. Thanks for having me, Mike. I'm really excited. Yeah, it's great. Great to catch up with you again. Um, for listeners who don't know all of my backstory and history, Patrick and I met, uh, while I was doing some corporate innovation consulting at American family insurance, Patrick was part of the venture capital team there, and I always hit it off, worked really well together. And, uh, so I was just when I wanted to do this episode on venture capital and what it takes to sort of break into that industry and just what, what it's all about Patrick was the guy I reached out to. So I really appreciate you being here, buddy. Um, so what I do first off with all my guests, because I just love a backstory. Um, I want to know about what, what was Patrick's first job.
Patrick Klas (00:53):
Going back to 14, like getting to go walking into your principal's office, and uh, asking for a work permit. So you could work as a teenager. Uh, you take it wherever you'd like to go. No, my first job was actually super transformational. It was actually teaching swim lessons when you're 14, 15, a lot of parents don't, aren't excited about, you know, their three-year-old being in the hands of a 14 year old. Uh, and so, you know, often you teach adults how to swim. And that first job taught me a lot. It taught me two things really primarily like one how valuable a skill is. And two, how you connect and teach someone when you're teaching a child to swim. You always put them in the deep end, so they can't touch the bottom. And Bob up and down, when you teach an adult to swim, there's usually the only reason they didn't learn to sermons often tied to fear.
Patrick Klas (01:38):
So you first establish that and then you never go into the deep end and you always tell, we will always swim where you can stand. And so you only swim in the shallow is part. And that way they have no fear, you'll eliminate the fear of swimming and that's how you teach it. And it was something that was just like about the importance of scaling connection that I didn't realize until I was much older. That how valuable? Well, that was, um, so I don't know. I, I don't know. I always loved teaching people to swim. It just really, really fun. Um, and it's fun to sharing a skill with someone. So that's my first job. Um, I don't use it very often in venture capital, but I, I read, oh, that's very good.
Michael Gardon (02:21):
I didn't know that about you actually. So I taught myself to swim as an adult. Well, I mean, I swam as a kid in the pool and everything, but actually swim freestyle and lapse. I, I learned taught myself as an adult. Um, but yeah, what you're saying about kind of just eliminating fear, like yeah. It's, it's so true. It doesn't, it's not just about kids. Like I use that tactic all the time with my kids, but with anyone eliminating, like the obstacle to just getting started or continuing on is so key. So that's really, really interesting. Do you feel like, do you feel like teaching swimming at all has somehow transcended across like what you do today? Um, I, I know you kind of said you don't use the, the, the skill itself, um, in venture capital, but did it influence any of your choices by any chance?
Patrick Klas (03:18):
You know, it didn't necessarily, but what it did influence was, uh, when you have an adult that is often three to six times older than you are, right? Uh, conquering often their biggest fear and their life. Um, and you're 14, right? You, the first thing you taught is build a connection. Hey, what made you want to learn how to swim? Yeah, this is really cool, right? You, you, you build a connection with people, right? And despite being 14, you know, we practiced these conversation. What made you want to learn how to swim too, you know, 45 years into this, what made you want to learn so much? 50? You know, I taught all ages and it was about building connection. You know, this is something I'm really scared of. Well, and then you say, well, don't worry. We're never going to the first month. We may never get out of three feet. I will never take you out of water. You can't stand. And the fear would melt away, but I will never will net cause that's there always the fear.
Patrick Klas (03:57):
And so, uh, so much about venture is you're selling a commodity. You know, I make early stage investments and really early companies often valued at somewhere between five and $25 million. And, um, there's lots of people that want to often make those investments. And it's about, I think, often a genuine connection. Uh, and, uh, so I've always learned that like anyone, most people can teach anyone to swim. But when you, when you work with someone that has a fear, you have to feel the connection and trust. And I, I think in the world, you know, we all had to learn how to build connections and trust digitally over zoom. And I think people that did that better ended up doing well this year in venture. So just that, that coming back to connection and trust, I, I don't think I, you know, learn a ton, but that, that really has always carried through in every job I've ever had.
Michael Gardon (04:48):
Yeah, I like that. And I think having been kind of on both sides, I, I invest a little bit on my own. I had never actually been with the venture capital team and I've also been on, been on the entrepreneurial side, raising the money. There's often a lot of fear or at least, you know, uncertainty around the future of what's going on. So I do, I can appreciate, um, that human connection, you know, and sort of that mentorship that goes a long way. Um, can you sort of, so again, this episode, I want to really dive into the VC and the career track and everything. Can you sort of give our listeners an idea of your career, track and trajectory, you know, maybe starting out of college, uh, and just kinda take the, take the arc of sort of where you've been. Um, and I guess maybe I would just, just maybe start with this question, which is, did you always know you wanted to go into venture?
Patrick Klas (05:45):
Yeah. I'll start with your first question, which is, did I always know I wanted to go into venture? Um, and the answer is no, the venture, when I started was 2013, it didn't have the name that it today. It wasn't nearly as something that people pursued directly out of college. So I feel very fortunate that I landed somewhere out of college. Um, let me take a little step further back about venture capital, right? Um, if you've ever heard of venture capitalists speak, and if you haven't, they'll tell you, we say, we look at several thousand deals and it's specific specific year, right? And we invest in 10 to 10 to 40 typically. And then they'll talk about just, you know, a hundred of those we'll take two diligence. We'll look at their financials. 25 of them will take to an investment committee where we actually vote on them and only 10 of them will get through. Uh, what I think looking back at this career, the career projection is very simple. There are thousands and thousands of analysts out there, right? And then only a small amount of those make it to associates and then a smaller one of those make it to principal and then a minuscule amount make it's actually managing and raising a fund themselves.
Michael Gardon (6:50)
Can you, can you break down those specific jobs within venture capital community? So I think a lot of the listeners might not know the difference between an analyst and associate.
Patrick Klas (07:09):
In Venture is often about managing a network and your portfolio, the investments you've made. And so the farther up you are in that dynamic, the more responsibilities you have in actually writing the check, making the final decision and managing the portfolio. So as an analyst, you'll come in and a lot of it will be about market research, knowing a space from the back to the front. And not only you knowing it, being able to convey that information to someone that doesn't want to spend three months reading about granola bars, right. Or if that's the space that your fund wants to invest in, or life insurance or something very specific. Right. And then the other side of that is really doing what we call due diligence. W there, there are, you know, there are lots of ways to do due diligence, but w what is the management team?
Patrick Klas (08:01):
How large is the market? How much momentum does the team have? What is their, what is their magic sauce, right? Can you identify that and write that well in a report that says, should we make this investment too or not? Right. And associate moves up that still doing a lot more analysis. Well, they're not going to start reaching out to founders as if they have checked brain, your ability. They typically don't some associates do, but they're going to start cultivating a network and relationships and take that market knowledge. They know, and apply it to looking for investments. And this is different across every fund, but this is kind of just, you know, the general landscape, a principal is going to typically have that check writing authority. They will sit on an investment committee, they will make final decisions and they will sit on boards. They will, they will, you know, manage the entire process.
Patrick Klas (08:51):
And then you start getting GPS and partners and managing directors, and there'll be responsible for fundraising fund dynamics, fund management. It goes up there, that's the goal, right? That's the, the final thing, but that's kind of how the landscape works.
Michael Gardon:
Okay, great. That's super helpful. And so I want to dig into the places you've been, where you've started. I assume you started as an analyst and just kind of talk about maybe some of the places you've been, and yeah.
Patrick Klas:
So, yeah, so I started as an analyst and, you know, there are different types of venture capital funds, right? And they're often talked about tiers. Um, like the tier one funds are the funds that you might've heard of injuries and Horowitz, Sequoia, things like that. Um, and, and there are different tiers based on fund size. What type of checks you write, how you write them, are you early?
Patrick Klas (09:41):
Do you write a hundred million dollar checks? You write a hundred thousand dollars checks, uh, in one of those tiers is called corporate venture capital. You are typically investing directly off the balance sheet of a very large corporation. So my first job was at a corporate venture capital fund or the CVCs as an analyst. Um, I had a really cool opportunity there right after I started to go run an accelerator alongside Microsoft ventures, uh, on the connected home. So there are I, I source 550 companies and we narrowed it down to 10. We relocated all those 10 companies to Seattle Washington on Microsoft campus. And we ran them through a 16, um, 16 different courses on random a business. And so that was like a really great way for me to actually gain some skills on operating in this industry. From there, I spent a year as a chief of staff.
Patrick Klas (10:34):
So I stepped away from venture instead of cheer as his chief of staff to, you know, a C-level suite at American family insurance. And so that was really transformational for me, picking up a lot of the hard skills required, professionalism, you know, learning negotiating at a top level, seeing a lot of important meetings, just that was a really transformational aspect for me. I went back to venture and then I moved out to San Francisco and I joined a startup as head of operations. So I helped the company grow from seven to, you know, over 30 employees and helping the company fundraise several million dollars. So I got to execute on that aspect of the business and then ended up coming back to American family ventures as an associate. So, you know, in that bridge between, um, uh, you know, check writing and management, and then recently, right on the first day of federal quarantine, March 15th of last year, I started at MTV as a principal, you know, writing checks here. Uh, our scope is typically that $250,000 early seed check. So I, I get to, you know, make the investments and then work with the founders to help them grow into that series. A hopefully that series B and larger and help them execute on this vision.
Michael Gardon (11:43):
Cool. So I'm interested in you, you left venture, you went to a startup, you came back to venture. What was that like? What, how did you make that decision? Um, and obviously like venture being on that side of the table a little bit more,
Patrick Klas:
Uh, yeah, I do. I do. I mean, operating is a very, you know, th there's, there's two really great things about, there's a great thing by both sides of it, operating is fun. Cause you get to execute, you get to build, right. There's nothing better than teaching someone a skill like swimming and like something that they can have for the rest of their life. There's kind of that fun thing. When you release a new product, when you're operating, it's like, wow, like we're really trying to change this industry and grow this business to be massive. And it's kind of really exciting.
Patrick Klas (12:31):
Uh, but you're growing and building all the time and venture, you have this opportunity often, which sometimes you can just sit down and think you get to develop thesis you get to be thoughtful on a specific space. Where do I think this space is going in the next two to five years and why, and need to go look for those companies. Talk to those founders, get smarter on that and evolve and evolve and evolve. And I started up, you have a ticking clock, you are burning capital faster than you are, are, are bringing money in the door. And so you often don't get that time to sit down and think, right, you are, there is competitors, there are cumbents that are going after your marketing that you are going after. And so, um, the one thing I really missed about operating was sometimes just sitting down for a day and be like, okay, let's really think about where this space is going.
Patrick Klas(13:19):
And venture is it's somewhat like unlike many jobs you could actually like, all right, before I make this investment, I need to be smart in this space. How do I do that? Let me go talk to 20 experts. Let me read these research reports and start up. Sometimes you're just executing so quickly that you don't get that opportunity. Um, so I, I really, you know, I chose to operate because I wanted the skillsets. I wanted the knowledge of, uh, of what it was like being on that side of the table. And I really do think I learned a lot in that year. I learned a lot of what are the things that annoyed me, that venture capitalists do and how to avoid those, uh, pitfalls and you know, what it takes to, to drive in the, sometimes the importance of specific margins and what, what I should be paying to as what I should be paying attention to as an investor.
Michael Gardon (14:08):
Yeah. Lots of data points. But I, I see your job as essentially like weeding through what's actually the most important, oftentimes, you know, there's so much there. Um, but focusing on the one or two things that are actually driving the business or the metrics that you have to really keep tabs on is, uh, is a key skill. Yeah. What, um, you know, so we kind of talked with you, you, you touched on, I mean, there's a lot of judgment and that you have to develop and skills around that. Um, you also touched on being able to think and write and communicate like as an analyst on up to a, can you talk about that? And maybe some of the other just core skills that you think are really, really necessary to succeed in venture.
Patrick Klas:
Yeah. You know, ventures, ventures odd in a sense that everyone wants to invest in every space, but the more you are generous, I think the harder it is, right.
Patrick Klas (15:14):
If you want to invest in health tech versus deep tech, you need to know those spaces. Well, you need to build a network there and you need to know what's a good and bad investment. Uh, so I think the first skill that I would encourage anyone is this is a very passionate job. You're talking about deploying millions, millions of dollars into very passionate people. So pick a space that, you know, you're going to be passionate about and be excited about. And I, I would encourage a certain amount of specialization, right? Just don't say, I want to get into venture. I would pick a space cause, and then you can get smart enough in that space where you stepped into a room with someone, you could impress them, where you could develop thinking on the future of that space, it could be blockchain. It could be crypto.
Patrick Klas (16:01):
It could be insurance could be, you know, it could be climate change if you're super passionate at that, but it gives you something that says, Hey, this is something I'm really passionate about. And this is the way I think about that space. And if you're hiring an analyst, you might not, you might not the person hiring. You might not agree with your viewpoint, but they're going to carry it. You do have a view on something. And so start the number one, I think best, best saying, and this is certainly not my same, but his strong opinions, weakly held, can you build really strong opinions and then be changed often if you're wrong. And so the most important thing there is building opinions. And so it's hard to build opinions about things that you're not knowledgeable about and B you're not passionate. So to me, it's, it's, don't just go chasing after venture.
Patrick Klas (16:48):
If you have, if you have a network and a pipeline to it, go for it. But at this time you're, you're, you're wanting to get into, you're excited about pick a space that you think is exciting and you're passionate about, and then learn about that space. Talk to entrepreneurs, learn or read about that space in certain things, where do you think this space is going in the future? And you'll impress people way more with that, that viewpoint rather than just spitting back facts, MIP.
Michael Gardon:
Yeah. I think what always impressed me the most about your team when I worked with you guys was what you said spot on. Like, you guys were always driving at an opinion and developing an opinion and, and backing that. Right. Um, and then the other one was, I'll just go back to writing. Like I felt like when I worked with a number of members of your team, like you guys really developed the art of writing, you know, great memos, um, concise, you know, just all the right information so that a decision maker doesn't have to spend the same amount of time you did investigating all of this, has the information there.
Michael Gardon (17:54):
And I think like that has been that I run a remote company and I, when I hire somebody, I test them on their writing abilities. Um, whether that's email or, you know, in long form, because as we've seen like this past year with remote, like writing skills are so important because they're a time-saver, um, they represent, you know, clear thinking. And so, like, I think that's just a huge one that I see a lot in venture. And I just, something I really appreciated about your guys' team, you know, when I was able to work with you yeah.
Patrick Klas:
In every venture capitalist does this, you know, there are, if you go to Bessemer, they're a tier one fund you can read through most of their successful and unsuccessful memos on previous deals. That's a great resource because most venture capitals, aren't going to share that until, you know, 10 years down the road, but you could just see their thinking where it's right and where it's wrong and why did, or didn't matter for that deal.
Patrick Klas (18:53):
But I think a really good framework is, is building that what you have to believe is this is something I got from, you know, a previous colleague, what you have to believe, like, what are the core things you need to believe about this company for it to be successful. And then the important exercise is then doing the, what the opposite of that. Because if you believe those things to be true, well, then the others can't be true. And it really pokes holes in your own arguments. Uh, and then you can boil it down to specific thesis, like why you're making this bet, but it's also, you sound so much more intelligent and thoughtful. When you have looked at the other side of the argument, you have written it down, Hey, here's why I don't think this is going to happen, but it is an option. It could happen. And it's so much more convincing when you say, Hey, I see your viewpoint. And I actually wrote about it. Here is something that's really powerful. And it actually makes your argument typically much stronger.
Michael Gardon (19:52):
I've heard you in your language today, talk a lot about you sound more impressive or you're going to impress more people. Um, and that is completely true in what you're saying, but it brings me to, you know, how does somebody break into this industry, right? If I've got somebody who is in college and wants to pursue a career in venture, and I know you talked about specialization and a lot of those types of things, what are some things that, that they can do, or they can think about aside from, you know, oh, I have to get into Stanford and go to the job fair where all the VCs come, right? Like, like how does somebody get into that? I mean, again, you, you did it in lowly, Madison, Wisconsin.
Patrick Klas:
Yeah. You know, there's like, there's, there's several ways of getting into venture. You know, honestly the best is to start working at engaging with startups, whether it's in someone's dorm room, but it gives you experience and it gives you the lingo, right? It gives you the ability to say I'm excited about startups and this is why. So to me, it's, it's getting There, starting
Patrick Klas (21:04):
There, right. Just starting there. The second thing is, uh, most people that got into venture have a unique story or a certain way, and they're passionate about it. And so if you demonstrate knowledge and you write a thoughtful email to someone that works in venture, Hey, I'm a, I'm a junior at this school. I'm thinking about the end of venture. I'm really excited about these five previous investments you make here is the, you know, I want to talk about the thesis or the vision of the fund and why you made these investments. And you demonstrate that you have done research, you've acknowledged and it's worth their time. They'll often take the time to do that, but it's, it's demonstrating a that you understand the fund, you understand their investments, you've paid attention to what they're doing. And you're in a sense, flattering them a little bit.
Patrik Klas (21:49):
I think it's probably important. It's demonstrating that you truly understand where it's going. Now. There, there are some great books. Brad Feld has a book called venture deals that everyone should read that is ever trying to get into venture. But to me, it's, it's about being thoughtful. You know, if you're ever in sales right there, there's quantity or quality here. To me, it's about being very thoughtful with every engagement venture capitalists do see thousands of deals and they make the decision typically in the first five minutes, whether they're going to move that forward, does it meet their previous thesis that they like this space. And so going with that material being like, I want to have that person leaning towards yes. That they liked me. And they liked my thinking before they meet. So be super thoughtful in how you engage and better yet, if you can network into meeting someone is always going to be better for you because this job's about networking.
Patrick Klas (22:41):
So do you have someone that will make an introduction for you and pass on your information will always be better. I didn't have that. So I'm saying that you don't need it. But I think if I learned from my own mistakes, it's about being intentional and how you reach out and how you communicate and what you're trying to accomplish.
Michael Gardon:
Yeah. That's great. Well, part of what I'm trying to do with CareerCloud is open people's eyes to their options. Right. And then help them be more intentional about making those decisions that impact their career trajectory. Cause I feel like, you know, I, if I would've known some things that I know now when I was 25, I would have maybe made different choices or could have accelerated some of the things that have happened in my career so far. But it's that intentionality that I think a lot of people we just miss sometimes.
Patrick Klas (23:33):
Yeah. The, yeah, it's, there's so much imposter syndrome when you're looking for a job because like it's a little bit nailing eliminating that imposter syndrome and being thoughtful and intentional, but don't let imposter syndrome, uh, prevent you from reaching out to that person that you've been wanting to reach out to, or, you know, writing that email or taking that leap of faith on LinkedIn. Don't let your imposter syndrome go do the things a possible imposter syndrome. I think in job hunting is so circular because when you don't get that first job, you're like, why would I apply for the second? I'm not going to get it. And then all of a sudden you see the job posting go down. You're like, well, I didn't get that one either. We never applied. Right. Imposter syndrome is such a circular thing in job hunting and it grows and grows you.
Michael Gardon (24:17):
Yeah. Another thing I see I've seen, uh, obviously, uh, it's been a huge trend. I, I think amongst, uh, venture capitalists, uh, associates, principals, what have you is, and it's related to writing, but it's having a social media presence and having a blog that, where they demonstrate their point of view on whatever. And I think candidates can emulate that. Right. Starting early. Like you talk, I'll take a lot of your tips that you're talking about, put them in a public forum and you know, that that's showing your work product to the world. And so like on that note, I know like I'm always thinking about like, what are the newer social media things here, but you are, you were one of the first people I saw really embrace Clubhouse. And I know you have an InsureTech hour.Do you do that every week?
Patrick Klas:
Every week, every week.
Michael Gardon:
But talk a little bit about that and how you're utilizing that. And then if there's anything that you've learned from clubhouse that could apply to, you know, job seekers as well or how they could leverage that cloud. Yeah. So I've, I've learned a lot about myself, more than clubhouse on this, right? So I'm like, I'm in like maybe three, four months in, so I've done, you know, 12, 12 to 16 of these, uh, abuse clubhouse where I have audio only. And I interviewed to be an entrepreneur for hour. And the reason I do weekly is a to keep a cadence and B to commit to it. Right. That means the next week I always have to be finding someone. So I can't let imposter syndrome. Creep, scare myself out because it is putting myself out there.
Patrick Klas (25:58):
Like I've never done this before. It's building a personal brand, like I've never done before. And it also requires me to be a lot more genuine in my personal brand because I don't want my Twitter and my LinkedIn only being nonsense about clubhouse. I want people to know that I'm a real genuine person, that's intentional and cares. And so it's posting a lot more personal stuff, opening up about my life and thoughts on investments. So I didn't expect back from it. I didn't think it would have this impact on how I put myself out there much more than I did. Um, and then I wish I had written down my goals for this because I always had my goals being how many people would come listen to me interviewing someone. And that, if that was my goal, I think I have failed. You know, I typically have 20 to 30 in the room, so not huge.
Patrick Klas (26:45):
I'm not a podcast, you know, with hundreds of thousands of listeners. Uh, but what I have built is very valuable personal relationships and I've learned. And so that's what pushes me forward and I was doing it right now. I, I write every person I a handwritten note afterwards, thank you to them because it means a ton to me that they would even come on and talk to me for an hour. And so, uh, what I didn't anticipate was just the impact of have on personal relationships and getting to know people on a much deeper way. And they take an hour out of their time to come do this with me. And so I wish I'd written down my goals. She has like a laugh at them being like, I didn't achieve any of those, but I'm fine with that because I achieved this other thing, true personal relationships that have led or will be doing investments and people that I think are really smart.
Michael Gardon (27:36):
Interesting. Very interesting. Yeah. It's, it's a platform that I've dabbled in a little bit. And I think the biggest feedback I've heard from people that I know that have used it and gone deep in it is that, that personal connection there isn't like traditional marketing monetization, you know, avenues, right. Like to build a business on clubhouse, but when you take those relationships that you're building and take them into a different sphere, like it becomes really powerful. And I am assuming, you know, you're doing that as well, obviously with the relationships that you're building. So really, really, really interesting stuff.
Patrick Klas:
Um, yeah. I mean, it's, it's all about putting yourself out there and doing it consistently. I think that's an important thing. And just being somewhat consistent about it, whether that's, you know, how you engage online or, you know, how often you're, you're, you know, trying to engage with startups to learn about gaining a venture, but having consistency will be more important doing it more regularly, going to the events, talking to people.
Patrick Klas (28:40):
I think consistency is an important thing about getting for this job.
Michael Gardon:
Oh, is, um, when I was thinking about like, okay, what would I do a room on or whatever I was, I was like, well, you know, what if nobody shows up. So the first one did you have, did you have that moment or did you have it pretty locked up? I have at least one person in the room I brought, I, you know, it was mandatory four to five people to show up. Those are the first one I did. That's like, not up on my website was just a hangout. You know, I got five to 10 people to talk and I I'd written down five or six things. Um, and now I bring up individual people, right? The first one was very much like, Hey, can I make this work? The reason I picked the clubhouse, I saw a ton of green space.
Patrick Klas (29:21):
You know, I saw the opportunity to lay down, to plant my flag in something that I thought could be helpful to other people. And it, uh, you know, the first thing I say when my intro to mine is like, hi, my name's Patrick. And I gave him a two sentence spiel on myself and I say, well, you didn't hear to come here. You didn't come here to hear me talk. You came to hear Mike talk. Right? And so I really try, I figured the less I talk the better I'm doing at highlighting this person that I obviously, I'm not doing that now, but it's been a good lesson for me on sometimes talking less, you know, does this need to be said, does this need to be said now? And does this need to be said now my by me is often a good filter.
Patrick Klas (30:02):
And, and, uh, it's been, you know, pivotal for me this like, Hey, if I can just ask those thoughtful, engaging questions, that's harder than often speaking. And so just being thoughtful and asking, engaging questions is it's a very fun skill to help. And I'm still need a lot of work on it, but it's a fun skills at home.
Michael Gardon:
Yeah. That's really interesting. That's another one of those. Uh, I'll just take it back to the kids. I have three kids and that's something I've learned from kids is like, sometimes I just have to not say anything and let this play out. Uh, and they'll, you know, might resolve it themselves. Or, you know, there might be some beautiful moment there that that happens because I'm not in, you know, inserting myself every two seconds. So really, really interesting stuff. Yeah. Clubhouses is, is pretty cool. I'd suggest people take a look and, and, uh, again, find your green space and find your point of view. And, and you know, what you can maybe be passionate about and carve out a little niche, even if it's 20 people joining you, it's very impactful as Patrick said. So, uh, I like that.
Patrick Klas (31:09):
Going back into job hunting, I think the number one skill people don't have is they'll be able to articulate well, their story and their vision, but the ability to ask a really good question to someone that's interviewing you is often super undervalued. Hey, I saw your fund, did this, I want to ask this question about what you think this means for the space. You're now flipping it, where you get to hear someone else's opinion and you can get smarter. I just think that's a really valuable thing going in with super thoughtful questions in the startup world for either if you're looking for an operating role, uh, or a venture role, I think it's super undervalued. So going in with super thoughtful questions that shows you spend time thinking about the space and the future of this space is incredibly valuable.
Michael Gardon (31:54):
Yeah. It shows you get it. It shows you did your homework, it shows your thoughtfulness. I totally agree. And then you get to not talk for a little while too. That's the best part, you know, I can't say anything stupid, right? Yeah, exactly. Very cool. Um, I want to pivot the conversation a little bit here at the end. Um, you got a really unique vantage point in that you see thousands of startups every single year. And so you got to, you got this vantage point into like where where's job growth coming from, like in the United States, right. Like in the macro economy. Um, and then I want to talk a little bit about remote work and how you've been impacted and also how, how, um, startups have been impacted, but maybe start off with like, where do you just see in the next years? We're like, where are the jobs really coming from, man?
Patrick Klas (32:43):
I, this might sound crazy. Excuse me. Um, part of the move out to San Francisco was around, you know, my wife, we, we both wanted to get new jobs and she wanted to move from public education to tech. And so we spent a lot of time thinking of like, where does her next shop? It's talking to me, public educated, exactly. A teacher, where do you want to go? Um, I, I, this might sound crazy, but good sales men and women are, are actually becoming more invaluable. And so, uh, the skills are not hard by, and not, not they're, they're very difficult, but they're not hard as in you have an engineering degree, right? But it's, it's building connections. It's being highly organized. It is building new processes and breaking old ones and in, and tearing down old systems and moving forward, it's working with people, it's reporting up.
Patrick Klas (33:37):
It's a lot of these skills. And I just think the power of a good sales man or sales woman is going to end the continue to separate them. And I see the career of salespeople in software only becoming more significant. Um, and there's a lot of people leaving the space just because of retiring that opiod have a ton of jobs. And I think people are scared because they, they think of a car salesman or, you know, Dunder Mifflin, right. But it's, it's way more than that. And, uh, it's a very passionate, it has tons of rollercoasters, uh, huge ups, huge lows. Um, but there are a ton of great managers in sales that want to see you succeed. And, and they're, they're, they're, uh, encouraged to him financially enabled to see you succeed. And that's an exciting way to get your foot in the door, whether it's a startup and you'll never stop using those skills.
Patrick Klas (34:31):
So maybe that's just like too easy to answer, but I don't think people consider going enough into sales and learning that, learning that backwards and forwards and doing it well because it is a, if you can do it well, you are a valuable commodity for the rest of your life.
Michael Gardon:
Uh, I'm surprised that you said that for sure. Uh, salespeople, but, you know, as I was listening to you talk, um, you were, you were describing it more as a skillset, right? And, and sales is applicable in almost any job specialization. You, you take, right. You have to get something approved. You have to, you know, influence somebody in some way. So it's like, yeah. At the entry level, right. Sales is generally easy to get into. It's a great spot to learn a number of skills and they're trans fully transferable into just about whatever you do.
Michael Gardon (35:23):
And I didn't hear you say social media selling or tech selling, you know, at all, you're, you're talking about no, like the fundamental skills of a salesperson, you could be selling anything, but like, what are those? And, and, and that's where you think a lot of job growth is.
Patrick Klas:
Yeah. You know, my wife came out and teaching, I I'm unbelievably impressed with her. And she like, what are my skills? Are the teachers like, I don't really haven't. And then she got into sales. She's like, well, I need to be hyper-organized. I need to be able to communicate things differently to different people based on how they learn information. And I need to know something really well. I eat a company's product and be able to convey that and teach someone about it. And she's like, oh my gosh, all teachers should hypothetically be great salespeople.
Patrick Klas (36:09):
Right? They're hyper organized. They have hundreds of kids. They convey information often to children and to different parents in different households differently. And they know something, I either skillset and they have to change it every single day. And they write sub plans. They plan out their, their, their entire year there. And she goes, oh my gosh, teachers could be our great salespeople. And it's these skills that she's she's learned are just invaluable. And so I do think if you're coming out of school, there are thousands of people that want to hire you as, as a sales development representative and SDR. And if you can find a manager that will convince that time to you, you can learn and move up really quickly. And, and again, it comes back to, can you, can you, so when you're selling to someone, their biggest fear is this person who's wanting to take advantage of me, and they're not going to know what I actually need. And can you use your skills and connections and trust to say, no, I'm not going to take advantage of you. I'm going to add value to you. Trust me. And don't be scared. I think that ultimately comes down to it.
Michael Gardon (37:14):
Cool. Good stuff. Um, I wanted to ask you, my viewpoint of venture capital is there's a lot of travel involved, a lot of meeting people, a lot of Palm pressing. How are you guys impacted over this past year with COVID and all these restrictions?
Patrick Klas:
Yeah. I mean, it's, it's a little bit crazy. Give me, you know, investing hundreds of thousand to someone that you've never met in person. Uh, so it was definitely a learning curve. I think my job will always have less travel. Now. I think that these first meetings probably should happen over zoom because we do thousands of them. And only so many go to the second ones. I think there's second and third and fourth ones are more likely to switch back.
Patrick Klas (38:01):
People always joke that the longest relationship you typically have is with your investors. So choose them wisely, right? They, they can be 10 years. And if you hate this person, it's kind of stuck with them. Uh, and so I think from an entrepreneurial standpoint, they're going to want to do diligence on us as much as they want to. We want to do it on them. I think the first meeting will be moved to zoom, but I do think that this is an industry of contrast, connection and vision. And I do think that's ultimately shared better in person over a dinner to, to understand someone's drive and where they're going and ask them the hard. But I think a lot of the first meetings that first several hundred meetings a year you do are going to be over zoom just to save everyone time.
Michael Gardon:
I had a conversation, um, I guess it was the beginning of last week with somebody in the corporate world, a CEO of a billion dollar company, old-school telecom company.
Michael Gardon (38:56):
And I was talking to him about, you know, how has remote work impacted you and what are the changes you're making and all that kind of stuff. And I was surprised to hear some of them, you know, re we're going to be reducing office footprint. Um, and you know, we're, we're going to probably be in sort of like a hybrid model where we have people in a couple days a week, how are startups looking at this, uh, this trend of remote work? Do you see a big shift in a lot of startups, maybe forgoing offices or doing something else?
Patrick Klas:
So I don't manage someone. I think this is probably a better question for someone that manages it, because the people that are managed have loved remote work, right? I can, I can do my work heads down. The people that manage, I think have really hated it because that, Hey, I need to grab you and have this conversation for five minutes by, you know, in the kitchen.
Patrick Klas (39:49):
And we just squash this and be done with it has now always turned into a 30, 45 minute zoom meeting. And it just, and every one-on-one that you just want to grab over lunch is now a 30, 45 minutes. I want to understand managers are much less efficient and people that are, are managed are way more efficient. Uh, I, you know, we invested in a company called office together. That's believes that the office will always be an important part, but it's just going to be half the size and you'll book when you want to come in and where you want to sit. And so like the WeWorks will do really well. There just be a software implementation that enables you to do that. Well. Uh, so I think that's probably more like it is. I think we, I think we are going to bounce her bounce back.
Patrick Klas (40:32):
I would like our society to bounce back because there's a lot of important jobs that are associated to people being physically in the organization. I think those people are very significant, uh, but I think there is going to be a happy medium. I don't see, you know, Mo many people going back five days a week, but I do see three days a week, four days a week just to make it easier on your manager so they can do the meeting, you know, and just be done. I don't know. I do think, um, there's probably a lot of, I think also handling conflict. I, you know, my fund hasn't had any, but I can't, I wouldn't, I'm not envious of a manager that has to handle an HR issue via zoom. Right. For sure. I'm not jealous of that. Um, that sounds miserable. Yeah. I think there's going to be some conflict resolution that will be much faster, much more efficient, which will make people much happier when conflict, when conflict is resolved, they're much more likely to stay at their job.
Patrick Klas (41:25):
And so I think a lot of them, you know, there's conflict at work. People are people. And I think a lot of it will be about eliminating conflict and moving back to efficiency.
Michael Gardon:
Yeah. I love it. I mean, I love remote work, uh, and I am a manager, but we have a small team and you know, it works for us. We're really efficient. I, everybody can pick up the phone and call me actually, uh, you know, for a five minute thing, not, we don't need a zoom call, but I get it like in larger organizations, you have a lot more of these challenges. So I do think we're going to this. I think remote's here to stay, but I think we're going to be in this hybrid situation. I, I agree with the thesis on the company, you mentioned, you know, office is going to be half the size and you're going to have rotating teams kind of come in and out, uh, Patrick great stuff. Is there anything that I didn't ask you that I should've asked you?
Patrick Klas (42:18):
No, I, I, I do think if, if people are interested in being an analyst at a venture capital fund, um, I do think it is a great stepping stone to doing hundreds of different things, whether that's being an analyst and then going operating from the portfolio. Uh, but my, my last thing would be, is it's never too early to start making a meaningful network. Uh, and the more you make, how do you make a meaningful network is going to look different for everyone, but it is going to become around this intentionality people, everyone that has been in work has been young. And so they, they know that how much courage it takes to write a really thoughtful email asking if you can go to coffee with someone or get 15 minutes on the phone to talk about their industry, cause you want to start a startup, but it's never too early to start being super intentional about the people that you want to be in your network and, and having that closely guarded.
Patrick Klas (43:11):
And a lot of that is going to be how you provide value to that person. And you might not have a lot of options, but the earlier you start and I didn't start early enough, the more it's going to pay off. And it's going to be about being intentional, genuine building trust and camaraderie with that person.
Michael Gardon:
Awesome stuff. Um, where can people find you learn more about you or MGB? Yeah. Uh, Patrick Kloss, K L a S a.com takes me to my LinkedIn. You can always reach out to me there or, uh, mgb.vc, the venture fund or the InsureTech hour, uh, is if you want to come hear me, hopefully ask questions and not talk too much on Wednesdays at 4:30 at campus calling on clubhouse. Yeah. Drop in, drop in and say, hi, Patrick, this has been awesome, man. Thank you so much. Great to catch up. It's been too long. Let's do it again sometime.
