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Kevin Douglas (00:06):
Today on the Entrepreneurship@DU podcast.
Hannah Nia (00:11):
Before coming into this, I would think that you just analyze startups based on their financials, but it’s so much more than that. And I think that’s the really fun part of VC is that it’s a very holistic picture.
Kevin Douglas (00:23):
We get an inside look at the Pioneer Venture Group, a venture capital firm managed entirely by DU students.
Luke Lopatofsky (00:31):
PVG does a really good job of bringing the students in, incorporating them in the startup and the venture capital space in Denver. It is a small pond here, but although it’s a small pond, it’s really vibrant and there’s a lot lot going on.
Kevin Douglas (00:42):
The Pioneer Venture Group or PVG launched in the fall of 2019 by accepting donations matched by the Burwell family. The firm provides seed funding for emerging startups in the Rocky Mountain region with a wide range of students across DU’s campus, including business law, computer science, and engineering. PVG offers valuable opportunities for those looking for internships and hands-on experience investing, problem solving, and developing professional relationships. We sat down with Hannah Nia and Luke Lopatofsky, current members of PVG to learn how the firm has impacted their time at DU and how it’s changed their career trajectories. I’m Kevin Douglas and this is the Entrepreneurship@DU Podcast. Thank you for tuning in to the Entrepreneurship@DU podcast. Today we have Hannah Nia, who is a managing partner of the Pioneer Venture Group. She’s an MBA candidate. She’s expected to graduate this June, 2023. We also have Luke Lopatofsky. He’s a lead partner of the Pioneer Venture Group and he’s a finance major French and economics minor. Also expected to graduate this June, 2023. Hannah, Luke, thanks so much for coming to the studio.
Luke Lopatofsky (02:03):
Hannah Nia (02:04):
Very for having us.
Kevin Douglas (02:05):
I want to start out by asking how you first heard about the group and what prompted your decision to sign up and join the group?
Luke Lopatofsky (02:12):
So I first heard about the group from one of my friends, Ming, who I believe has been in the group since his freshman year. So we’re just chit chatting cause we’re both finance majors and we’re both kind of, you know what we want, know what we want to do down the path. So we’re just about finance internships and whatnot. And he told me about Pioneer Venture Group and I was like, wow, that sounds like a lot of fun. How do you join? What do they do? And he said, it’s pretty much a venture capital firm that’s run and managed by students and you invest real money into startups. Sounds like, wow, that’s like, sounds like a great opportunity. That sounds really hands-on. And I’m a really hands-on person, so I like to learn. I feel like that’s the best educational opportunity for me. So after talking to Ming about it, I did as much as I can to try to get in the door. And then thankfully they were doing applications right around the corner. So I applied and I got in. So it was pretty nice.
Hannah Nia (02:59):
And I knew nothing about venture capital when I started my MBA program in the fall of 2021. And it was just two students that were in the cohort above me that were talking about applications going out in some of the first weeks of school. And I was like, okay, I’m going to apply what is there to lose? And I didn’t really know that it was an organized process where you have to apply to get in. And my big draw to it though, and when I started to learn more about venture capital is I actually came to business school cause I thought I wanted to start my own company. Then I kind of recognized all that it takes to do that and I don’t want to do that right now in my life. But the great part about PVG is that you are meeting founders and working with them and it’s just like you’re in this innovative and creative space. And that’s exactly what I wanted to do as a entrepreneur and a founder. So I’m working with entrepreneurship but just in a different form on the funding side, which is pretty fun.
Kevin Douglas (03:57):
Do you feel like you’ve gotten some pretty good takeaway aways as an entrepreneur in now that you’ve seen how investors think about investing?
Hannah Nia (04:03):
Oh, totally. Yeah. I think through PVG, we kind of see good and bad practices for sure and what successful startups look like and what they don’t. I mean, I’m very novice in that I this. I think startups take the ones that we think are successful, they might totally flop and the ones that have almost flopped might turn out to be successful.
Kevin Douglas (04:24):
What are some of those good and bad practices? And for both of you, what do you look at when you’re hearing a pitch from a new startup? What’s a red flag? What’s a green flag? Something that if an entrepreneur is listening to this now and getting ready to go into these kind of venture capital meetings, pieces of advice they could think about.
Luke Lopatofsky (04:41):
So some of the red flags that we see and that we don’t really like and the startups we invest in is a small team. We really like to see firms that have a good decent size team. So at least more than four people probably. I know we’ve had a couple people come in and pitch and they’ve been one or two person shows and we’re like, we can’t really invest in that. It’s two risky, if one of you get sick or something happens, you lose interest, you want to step away from the business. We have a big liability there. So we kind of like to look at practices that have a lot of people we also look at to look at scalability, size, maybe the run to profitability, is that going to be in the near term or is that going to be far off? So whenever we’re going to be able to recoup our investment, that’s really what we look at because ultimately what we like to do is we like to make profitable investments so we can keep the fund running and that we can have this for the next student classes after us.
So that’s our main goal.
Hannah Nia (05:33):
And I would say before coming into this, I would think that you just analyze startups based on their financials, but it’s so much more than that. And I think that’s the really fun part of VC is that it’s a very holistic picture. So as Luke mentioned, you look at their team, does the team, are they qualified? Do they have the experience? Who’s on their advisory board? You look at is their product or service actually solving problem or have they just repackaged a previous technology or service? Other things that we look at are acquisitions in the space. So is it HR tech for example? And have there been successful acquisitions in that space? A red flag would be, this is a very specific detail if the company doesn’t plan to exit or I P O, and that just means that they would want to run this family business forever. And in the startup or the VC space, we’re looking for hockey stick growth and to get a high return. And so if a company says like, oh, I plan on working here for the rest of our time or whatever, it’s like, oh no, we want to know their exit strategy.
Kevin Douglas (06:46):
Can you define what hockey stick growth is?
Hannah Nia (06:49):
Yeah. It means that this it, it’s like it booms. And so if we think of a unicorn, I think unicorn startups are defined as being valued at 1 billion. You think of Lyft or Uber or these startups that start a startups and then they just blow up and that’s the growth.
Kevin Douglas (07:12):
I’d love to hear just how, on a practical level, how often the group meets, how many students make up the group grad versus undergrad, and what an average meeting looks like when you meet.
Hannah Nia (07:22):
Yeah, I’ll take sort of our member base. So we’re roughly 20 members. One of the beauties of this year and what’s different is that we have a lot of undergrad representation. We have a high amount of law students as well. And law students are really key in our due diligence process because they help evaluate patents and sort of legal things that business students don’t really know how to do. We had a PhD student in the fall, so definitely diverse students that come with diverse interests.
Luke Lopatofsky (07:58):
So at the beginning of the question you asked how often we meet, we meet once a week and we all try to get together. If you can’t make it, it’s not a huge deal. But we do try to encourage everyone to participate and everyone to get in so that we can hear everyone’s feedback. And usually a typical meeting is there’s no, there’s honestly no typical meeting. We’ll either have a pitch or we’ll discuss ideas. And we have different lead partners that they lead their own partner or they lead their own practice almost like the professional development or the due diligence. So they’ll give us updates about what’s going on. And what I really take away, and probably one of my favorite experiences of being an undergrad is being able to gain the expertise and the knowledge of the MBA students. Cause a lot of them have, a lot of ‘EM are doing their professional MBAs and they have inDU’stry experience. So a lot of them really know what they’re doing and they’re really driven. And it’s really nice to see that because you don’t really get that taste with undergrad students. A lot of us haven’t really worked in an inDU’stry for a certain number of years because we’re usually right out of high school. So it’s a really good mix and we have a lot of experience and that’s probably definitely highlight.
Kevin Douglas (08:57):
Yeah, it sounds like the collaborative nature of the group and having, yeah, like you said, the diverse mix of backgrounds all providing their own expertise to these decisions has been really valuable. What’s the value of PVG itself when you think about what you’ll take away from the group when you move on to graduation and your career path, and if you had a friend that was still a student at DU that you were trying to convince to join the group, how would you pitch it to them? How would you define the value that they’ll get from the group?
Hannah Nia (09:25):
So in Colorado, the VC environment is pretty, it’s kind of a small pond. And again, I’m no expert, but what I mean to say is when you go to different events, you see the same people and they call VC environments or areas ecosystems. That’s like a buzzword in VC anyway. So the Denver ecosystem pretty small. So I think the value of being a part of PVG is you get access to these events and you can meet professionals in the VC ecosystem. In Denver, what I’ve heard is that Denver, well Denver’s one of top 10 cities for VC in the us and if you go to coastal cities, it can be a little more competitive. So I think it’s a unique opportunity when you join PVG that you have access to these events and then you can get plugged into the community if you do want to work in vc. There are a handful of funds in Denver and in Boulder. And so I’m interning at a fund, well, I just wrapped up my internship, the new community transformation fund. The other managing partner, Peyton, is at Ensemble Ventures. We have two first year candidates in our group and they are doing an internship with Techstars, which is out of Boulder, which is an accelerator. All that to say we all got these opportunities being a part of PVG.
Luke Lopatofsky (10:41):
So PVG does a really good job of bringing the students and incorporating them in the startup in the venture capital space in Denver. And Hannah touched on that. It is a small pond here, but although it’s a small pond, it’s really vibrant and there’s a lot going on. And before I joined the group, I didn’t really know anything about the venture capital scene in Denver. So that was something that I really liked and really took away from being in Pioneer Venture Group. I’ve been able to go to two events. I went to Denver Startup week this year, and then I also went to a founder’s brunch, which was a lot of fun where venture capital founders were pitching their ideas and we got free food that that’s always a plus. And then I got a network with founders, which I thought was a blast. So definitely a cool experience and I would not have had that opportunity if I didn’t join PVG.
Kevin Douglas (11:23):
Yeah, it definitely seems like a great pipeline for getting involved with Denver’s entrepreneurial community, which as we all know is growing really quickly. And it’s very cool that through the lens of venture capital, you get to engage with new startups and with VCs in the community through events like Denver Startup Week. And then did you want to also touch on the value businesses can derive from?
Hannah Nia (11:48):
Yeah, so this is actually part of our due diligence processor. We really want to know why companies are interested in pitching to PVG. And so a little bit of context, our check size, we write checks 10 to $25,000 for context on that. That’s like a drop in the bucket. A lot of our founders are raising multimillion dollar rounds or it could be 500,000 up to a few million. And so all that to say if we’re running a check size of 25,000 to help them get there minimal. So we really ask the startups, what value can we bring to you because it’s not just going to be about money. And I mean founders are so excited to be a part of University Networks, to have that connection to access our talent pool of students just graduating. And then also professors in the network too for expertise on that. So there hasn’t been a founder that has declined coming to pitch to us just because of our check size. They’re excited to pitch and meet us.
Kevin Douglas (12:54):
Yeah, that’s something I never thought about in terms of VC is not just the monetary value, but also the relationship value from being connected to Absolutely an institution like University of Denver.
Hannah Nia (13:04):
Luke Lopatofsky (13:05):
And when we write smaller check size, we kind of focus on that relationship value because that’s really our big driver. Hannah talked about, we write smaller checks, so that’s not really our main focus. Our main focus is the relationship. How can we help them, how can they help us? So we want it to be a really symbiotic relationship.
Hannah Nia (13:20):
Definitely. And then one of our guest speakers, Julie Markham, she is a alum and was also part of PVG and she works at Deloitte now. She had this great quote, I’m sure it wasn’t hers, but I’ll quote her on this. She said, your net worth is equal to your network. And I know founders are always happy to network and meet people that could help them in the long run.
Luke Lopatofsky (13:43):
And we had an advisory board meeting a couple weeks ago and one of our advisors there, I was talking to Greg Barnett, he was talking about how many people he knows and he is like, I probably have over 23,000 contacts in my phone. And that’s really how I’ve been able to jumpstart my family fund is just the people I know and the people there really comes full circle when you help them out, they can come back and help you out. And that’s, I think that was the main takeaway from speaking with them is really impactful.
Kevin Douglas (14:08):
I want to go off that and ask about the relationship with the faculty advisors. Cause I know it’s student run and student managed. How does the dynamic with the advisors work? How often are they coming in and overseeing what you’re doing? What does that dynamic look like between the students and the advisors?
Luke Lopatofsky (14:24):
So we have a bunch of academic advisors, which are pretty much his faculty members. Our main advisor is Chris, and he’s like a professional. He is a cfa, so he’s really well versed, really knowledgeable.
Hannah Nia (14:35):
Shout out to Chris.
Luke Lopatofsky (14:36):
Yeah, this is great. Yeah, he’s really knowledgeable in the space. So he sits in on all of our meetings and he listens to our pitches and he tries to urge us in the right direction. So if we just listen to a pitch and we’re discussing if we think we should invest or if we think we should move into dil due diligence and Chris thinks we’re moving in the wrong direction, he’ll probably pop up a question, what do you guys think about X? And they’re like, oh, we didn’t really think about that. Thanks for bringing that up. Maybe we’ll shy away or maybe we want to look more into it. So he really offers a lot of knowledge and expertise and he’s really just kind of, you say frog on the pond there. He’s kind of just sitting, watching, waiting for something to happen and show his knowledge. And he really lets us take the reigns. So it’s really nice in that aspect.
Hannah Nia (15:17):
Yeah, so Chris is our official advisor. He comes to every meeting. And then Joshua Ross has been joining our meetings starting in winter quarter and there’s definitely been a presence of do you entrepreneurship as well.
Kevin Douglas (15:31):
Thinking about your own career paths and your own skillsets, what do you think? Because you mentioned you didn’t know anything about venture capital before joining, and I don’t know if you mentioned what you knew beforehand, but
Luke Lopatofsky (15:42):
I did not know very much about venture capital before I started. Okay.
Kevin Douglas (15:45):
So this was entirely new territory for you both when you joined. What do you think you’ve learned that you’ll take into your personal career paths as you graduate and move on to the next step?
Luke Lopatofsky (15:59):
One thing I definitely learned is to be confident in every situation you’re in. Cause earlier I talked about going to one of the founders brunch, and I was a little nervous going into that because I looked at it as like, oh, I’m just a college student and I’m here with a bunch of successful founders who have started their own businesses. They’re not going to want to talk to me. Which wasn’t true at all. That was just the anxiety I had going into it. But that was definitely a main thing. A lot of people, they don’t really care about. Maybe your experience or your knowledge, they just care that you’re trying to learn and that you’re trying to gain the experience. So that was definitely a huge take away. And the takeaways I’ve left or I’ve had is learning about venture capital. I said coming into the group, I didn’t know much. And being in the group, they do a good job of teaching. Our managing partners like Hannah, they do a really good job on the educational aspect. So everyone, a lot of us have questions because they don’t really touch on venture capital and the undergrad degree, so they encourage us to ask questions and they’re really helpful filling in what we don’t know. So that’s been great.
Hannah Nia (16:53):
Yeah, I would say going back on what I said of VC’s all about holistic decision making. And so I think just taking that forward with me and just in a corporate or startup sense, I guess the decisions are not just about the financials, VC is an art and a science and luck and risk and all that,
Kevin Douglas (17:20):
Which is one of the reasons why I guess the hands-on learning is the best form. Just taking a class on the concept of VC won’t tell you nearly as much as being someone on a board making those decisions. Is there a recent investment or pitch, and I’m sure there’s some confidentiality involved with all that, but when you look back on your time with PVG, has there been a specific session or specific meeting or specific startup you’ve invested in that that will stick with you that you’ll remember?
Luke Lopatofsky (17:47):
I would say for me it was definitely my first. And I think my first meeting was probably most impactful because I think we had a pitch that day. So I came in knowing absolutely nothing and then they thrown me right in the deep end. So I really enjoy that process being thrown in. I get to catch up on my own and if I have any questions, ask them. I think that’s probably one of the better learning opportunities and better learning experiences. So I really like that.
Hannah Nia (18:08):
I am thinking. So the first part of your question was about a pitch and nothing’s confidential. Well, there are some things, but we saw a pitch recently and I, there’s many things that I’m going to look back fondly on PVG, but we saw this pitch and they’re called dateability. So it’s a dating app for people with physical or internal disabilities. And the sisters are from Telluride. They were the founders and they had a really crisp, concise pitch. And I just loved the sort of equity mission that was a part of their business idea. And I do think it’s going to be successful and we are in due diligence with them right now. So I was very moved and inspired by that pitch.
Kevin Douglas (18:53):
I know from some of the research and I wrote an article on PVG A while back, we explored the purpose-driven nature of a lot of the startups you see. And I think that’s another great thing that you don’t always see with VCs. And looking at not just the numbers, but you were talking about the holistic approach. I think that’s really fantastic and real and pretty unique in the VC space from what I gather.
Luke Lopatofsky (19:18):
And tracking back to one of your questions earlier about what we look for, we really look for people who are mission driven. So with dateability, we really enjoyed that. They were so passionate about creating this product and helping these people out. So that was a big plus.
Kevin Douglas (19:30):
When you consider your own personal background with your finance degree, you with your decided to start a business in the mba, what do you think you’ve brought to the table in the decision making process, and what specific aspects of these investing decisions do you think you’ve contributed to?
Hannah Nia (19:49):
I think so coming in, knowing nothing about vc, I really wanted to make it a point to have PVG be inclusive and educational, and there’s like no such thing as a stupid question. And so I think that we’ve definitely been successful at that this year. You members feel comfortable to ask questions. We’ve had educational sessions by other members and by our faculty advisors. So I love that educational and inclusive aspect, something that I, I come from a passionate social justice background and I wanted to bring more equity into vc. And so currently the market of vc, most VC funds are run by older white men. So they’re going to invest in their networks and their communities and people that look like them. I really wanted to come in and Peter and I are the female representation managing partners, but really the script on that and invite founders from all backgrounds. And at Denver Startup Week, like Luke mentioned, a few of us sat in on the equity pitch competition. And so most of the founders were people of color. And so we actually did have a few of them come into pitch. So just things like that really being intentional about the space we’re creating for our members and that it’s educational, inclusive, and then who we’re inviting in to come and pitch.
Luke Lopatofsky (21:16):
Yeah, I would say one of the things that I bring in, or I guess one of my expertise is definitely in the micro senses on the financial statements because that’s really what I’m learning about in classes. So it really helps translate well from my classes to pvg. So that’s probably where I have the most impact.
Kevin Douglas (21:31):
Outside of the pitch meetings, have there been retreats that the group has gone on together or team building exercises or things that, just from a social standpoint, how have y’all connected with each other? Even if it’s not officially group oriented,
Hannah Nia (21:44):
If happy hour counts as a retreat, totally a retreat to the pile.
Luke Lopatofsky (21:49):
And then we also do networking events with other venture capital groups. I know that Boulder that the lead school of business, they have a good group and we did a happy hour with them where they brought their group down, we came up and then we just chit about what’s going on. And we try to do that. We try to network with individuals and groups in the community so that we can keep a touch on what’s going around and make sure we’re attending all the events that we can.
Hannah Nia (22:11):
Yeah, that’s the Deming Center, or wait, Deming Center Venture Fund, D C V F, that is Boulder’s Venture Fund. And it’s a bit around three times as long as we have. So they’re pretty established, but they’re great group.
Kevin Douglas (22:23):
That’s also student run, student manage. Yeah. Yeah, I think that’s great. Also, considering you’re all not just full-time venture capitalists, but also students with your own degrees and your own pursuits.
Hannah Nia (22:35):
And I would say that’s our biggest challenge, actually. I’m glad you said that. So we’re all full-time students. I don’t know if anybody’s part-time. So all that to say like PVG is an extracurricular, so it’s not always going to be everyone’s focus. So that can become challenging when we’re trying to get a deal through or due diligence. And we’re asking people to do work on a diligence task when it’s like, well, I have this big exam, so it’s like, Ugh, what are you going to pick? So sometimes it goes to the wayside, but we’re all doing the best we can. And honestly, at the end of the day, if we’re learning and we’re enthusiastic about VC and no more after we leave, that’s all it’s important.
Kevin Douglas (23:16):
Have there been other challenging aspects of being part of the group? And what do you think you’ve gained from overcoming those challenges?
Luke Lopatofsky (23:24):
I would say one of the challenging aspects of the group being a new member, is trying to bring in pitches. Cause when I first came into pvg, I didn’t really have the network of entrepreneurs or friends that were starting businesses or that were looking for funding. So going out and trying to find entrepreneurs and startup companies that were in the startup phase, looking for funding was definitely one of the bigger challenges. But I think I overcame well, trying to just network. And that goes back to the other thing I said earlier about being confident and just trying to do your best that you can.
Kevin Douglas (23:53):
So we ask all of our guests a couple rapid questions as we’re wrapping up just to get a glimpse into your personal views on entrepreneurship or just success in general. First question is how do you define success?
Luke Lopatofsky (24:07):
Are you talking about in a business or a personal setting
Hannah Nia (24:09):
In life? However you think
Kevin Douglas (24:10):
It life, you personally interpret it.
Luke Lopatofsky (24:14):
I view success as just being happy and enjoying what you’re doing. Ultimately, if you have a smile on your face, that’s the end goal. That’s all you can ask for. At the end of the day.
Hannah Nia (24:22):
I’m going to say treating friends and family and work-life balance.
Kevin Douglas (24:27):
Those are good mantras to live by, I feel like. And then what is the best or worst piece of advice you’ve ever gotten?
Luke Lopatofsky (24:35):
I’d say the best advice is just put yourself out there. Whether that be joining a club or going to a founder’s brunch, no matter what you do, it’ll probably ultimately been, it will ultimately be being a positive experience. And if it’s a negative one, just don’t do it again.
Hannah Nia (24:50):
So this goes back to Julie Markham. So your net worth is equal to your network. Going further into that, build your own personal set of advisors and your own advisory board for mentors or professors or friends that have experience that you want. And then I also think be shameless on LinkedIn and reach out to people that are doing things that you want to do, and maybe they might be a part of your board of advisors.
Kevin Douglas (25:21):
And then finally, from a VC perspective, what is one succinct piece of advice you’d give to an entrepreneur, to a founder going into a pitch?
Luke Lopatofsky (25:32):
Hannah Nia (25:33):
I think honesty or I don’t think that we’ve ever been lied to by founders, but sometimes they paint something a certain way and then when we’re doing due diligence and we have access to their data room, it’s like, we’re going to see what you’re really, they’re going to see the other side of that. So just like be honest, am confident.
Luke Lopatofsky (25:51):
Yeah, I would guess I would just say be confident and remember why you’re there.
Kevin Douglas (25:54):
I want to thank you both for coming into the studio. I feel like I’ve learned a lot about Pioneer Venture Group and both about you two as well. So want to wish you the best of luck as you go into post-graduation and future career paths. And thank you so much for chatting with us today. Yeah,
Luke Lopatofsky (26:08):
Thank for having
Hannah Nia (26:09):
Us on the podcast. He’s having us.
Kevin Douglas (26:13):
The Entrepreneurship@DU podcast was recorded in Marjorie Reed Hall on the University of Denver campus. You can find us on Instagram at du Entrepreneur, on Twitter, at underscore entrepreneur, and on Facebook at Entrepreneurship@DU entrepreneurship. At DU is part of the Daniels College of Business, which has its own podcast. By the way. Check out Voices of Experience available wherever you get your podcasts.