Angel Q&A Series: Shelley Prevost of The JumpFund
Shelley is one of the founders of The JumpFund, an angel fund investing in female-led startups with high growth potential. Additionally, she is also a partner at the venture capital firm, Lamp Post Group, and is co-founder and CEO at Torch, a startup geared at making more parent-friendly routers. Shelley spoke to us about the future of women in angel investing, and her experiences entering the field.
Startup Angels: How did you get your start? What is your background?
Shelley Prevost: I have a totally backwards story. I was a practicing psychotherapist for 12 years. In 2010 I met Allan Davis, who was the COO of Access America, which was financially doing really well. He started Lamp Post Group (with his two partners Ted Alling and Barry Large) and told me : “Shelley, we need a psychologist because entrepreneurs are batshit crazy.” I knew nothing about venture capital or angel investing but I was also ready for something new and different. In 2010, I joined Lamp Post as a founding partner, and did one-on-one coaching, couples counseling, and other things that help with scaling a small company.
Chattanooga had its first GigTank in 2012, and I never thought of myself as a feminist, but I saw zero women. The more I talked to people, and I realized that the lack of women in startups was a global problem. That was when we started thinking about the JumpFund. Tiffanie Robinson, Kristina Montague, Stephanie Crowe, and I all started dreaming. A year later we added Cory Allison, Betsy Brown, and Leonora Williamson to our GP group. We began fundraising over the course of a year, and when we closed we had over 50 women investors from Chattanooga and raised 2.5 million. Now we’ve invested in 9 women-lead companies. Currently, we are in discussions about JumpFund II.
Even with The JumpFund, my role is still very much the psychologist, really asking more personality related questions. Can this team execute? How well do they communicate? Are they cohesive? Do they complement each others skills sets? I’ve just started my own company, so now I have extra empathy for what it’s like as an entrepreneur. That’s only going to help us suss out good founders from the great ones.
SA: What about your company, Torch? How did that come about?
SP: I have 3 kids, all of whom are digital natives. One of them started obsessing over Minecraft. As a non-technical person, I just saw him playing a video game–at all hours of the day and night–I didn’t understand the complexity of the game or what it was teaching him. So I started freaking out because I, like everybody else, fear what I don’t understand. My partners at Lamp Post were like “that’s stupid not to let him play; you’ll handicap him. You have talented kids who just want to explore.” I knew they were right, but I also felt very overwhelmed and didn’t know how to manage the technology. I needed help setting up the routers and filtering content for my children. My partner Jack Studer realized that because enabling routers with parental controls is so cumbersome, there could be a business in that. With Torch, we are making set-up and management more intuitive with a router that is more parent-friendly. Helping parents is in the company’s DNA; We are helping families integrate tech into their lives in creative and balanced ways.
SA: What are some cities that churn out a lot of women led startups?
SP: Unfortunately, the lack of women in startups is happening everywhere. I wish I could point to a city that is doing it right. Cities like Chattanooga are trying to put a stake in the ground. I find myself reminding others of Shark Tank star Kevin O’Leary’s statistic that, of the 27 companies he’s invested in, the only ones that have given him a return are women-led. I do think that investors are realizing that there is this big untapped market. Lisa Calhoun is starting a $25 million fund in Atlanta. This is great for the Southeast.
SA: What female investor do you admire the most?
SP: I have a lot of respect for the women at Golden Seeds. A Managing Director, Loretta McCarthy, came and spoke to The JumpFund. She talked about how there are several reasons why she focuses on women investing. She said that people should get over their differences for investing in female entrepreneurship, because we are all reaching towards the same end goal so we shouldn’t let the differences divide us. Another investor that I admire is Kelly Hoey in New York. She “gets it”. She knows the ingredients that make success, and she’s a no nonsense person. She’s also a great collaborator; if she sees an opportunity she’ll let me know. I also really respect Joann Wilson who recently came out and said that she will only invest in gender diverse teams.
SA: What do you think the role of women in startup investing over the next few years will look like?
SP: To be honest, I don’t know. Things change so quickly, women can adapt pretty quickly, maybe because of our brains, maybe because we’ve had to out of necessity. And we’re great collaborators. I work hard to hire people who know what I don’t know. It is also what I was saying about Kelly: building communities rather than taking what’s mine. I think women are changing the game that way.
SA: What does the ideal angel that would invest through the JumpFund look like? Are they all local?
SP: Our LPs are women with industry-knowledge. Most of them have some knowledge/expertise in industries they’ve worked in for decades. They give very generously to these teams, and they serve on boards and mentor regularly. I would like investors to be more engaged in the startup ecosystem. Not a lot of investors will go to GigTank or a Demo Day, but I think they’d get a great deal from engaging with the talent and energy all over this city.
SA: How did you feel when you made your first investment? What went through your head when you signed the check? How long did it take?
SP: I think I cried. We had talked about this for so many years. I think it was for one of our Louisville companies. I remember that meeting with the six general partners, and I was so emotional about it. There are so many people around the country that bitch about the problem. Quit bemoaning the problem and start solving it. Collaborate with other angels, write a check, mentor an entrepreneur, get involved.
SA: What would you say to somebody on the fence?
SP: It’s not for everybody. There’s a certain level of risk that it takes, especially for early stage, that makes it not for everybody. There is a place for due diligence, but you can’t focus only on that, especially in pre-revenue companies. The magic of angel investing is in unlocking human potential and working alongside a small team to help them build their company. Those who have invested in other asset classes may not be comfortable with the risk associated with the startup world. If you want to write a check and sit back, this is not for you. If you get excited seeing a team work like hell to solve a problem and watching their potential unlocked, then angel investing could be your calling.
SA: What do you look for in entrepreneurs?
SP: I always want them to be cocky, to have a kind of swagger, both for men and women, to say crazy things. Also self-awareness. What I love is when they say they don’t know certain things and say they’re gonna hire somebody for that. I don’t like it when people say they can do everything, when it’s clear that they can’t. I also don’t take too well to excuses. That is a big no-no for me. If you give excuses now, you’re for sure going to give up when it gets hard, and it WILL get hard. In some pitches, I don’t say a word, and let my intuition do its job. Do this team have enough charisma to convince people of their crazy idea? It’s a new-found empathy now that I’m an entrepreneur. For women working with men, they have to go the extra mile and “bring it”. That’s what I’m looking for.
SA: What is the biggest mistake you’ve made?
SP: Not trusting myself. I’m not scared of failing in something that flops. For me mistakes happen when I don’t trust my instincts and go in the direction of my own feelings. My intuition rarely lets me down.
SA: Thanks for your time Shelley; we want to conclude our interview with a little word association game. For example, when I say ___, you say ____.
SP: Alright, sounds good to me.
SP: Smart, sharky, rich
SA: Silicon Valley?
SP: Tech bubble, impenetrable
SP: Community, mix of possibility, love, and pride in the city
SP: Creativity and balance, helping families
SP: Lead like a girl!