Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Shripriya Mahesh was recorded in August 2020.
Shripriya Mahesh, Founding Partner at Spero Ventures, talks about mission-driven investing.
Sramana Mitra: Tell us a little about your background as well as Spero Ventures.
Shripriya Mahesh: I grew up in India. I came to the US in 1995 and went to Silicon Valley in early 1999. I’ve been in Silicon Valley since then, primarily in operating roles in product and product marketing. I ran global product for eBay for several years.
Before coming back to my next stint with tech, I went to graduate film school at NYU. It was an exciting and intense period in my life. I came back to tech when I helped Pierre Omidyar launch. I’ve been institutionally investing since 2015.
I started at Omidyar Network and in 2018, we spun out Spero Ventures as a single LP. It’s a $100 million fund to invest in mission-driven entrepreneurs.
Sramana Mitra: Let’s learn a little bit about what your investment thesis is within the mission-driven entrepreneur space.
Shripriya Mahesh: We invest in the things that make life worth living. It covers well-being, working and purpose, and human connection. The fundamental underlying thesis is that the greatest companies of our generation will return fantastic financial returns as well as have a positive impact on the world.
We do not think that the two are separate. If you go back and look at companies like eBay, Tesla, or WhatsApp, this fundamentally democratizes access and puts the agency in the hands of people. Those are the types of companies that will have a massive impact on the world. We could have any thesis, but we picked this because we think it’s an important one.
Sramana Mitra: What stage do you invest in?
Shripriya Mahesh: We primarily invest in the earlier stages. As you know, over the past four years, series A has changed dramatically. The series A used to be $4 million or $5 million and now it’s $10 million to $15 million. We invest $2-$3 million in post product-market fit. We lead the price.
We have a concentrated strategy. We will invest in about 20 companies out of a $100 million fund. We spend a lot of time with each of our companies and we reserve a lot of dollars with them. We engage very deeply with each of them.
Sramana Mitra: What does the company need to have? Do they also need to have revenue before you are willing to write the check?
Shripriya Mahesh: It depends if the product market in that industry or for that company means revenue. Often it does. If it does, then yes they should because revenue is a fantastic proxy for product-market fit. In a business model where they are not generating revenue, these are primarily consumer or skill-based business. Then we will use other proxies.
Sramana Mitra: What about geography? Where do you like to invest?
Shripriya Mahesh: Omidyar Ventures is global, but since Spero is an early company with a small team, we focus on North America because we spend a lot of time with our entrepreneurs. Pre-COVID, we would be with them in person, but post-COVID, we are on the phones a lot, so you could say that we could be anywhere.
I do believe there is a benefit in knowing the market and having connections to help the companies. All of our networks are in the US because it’s where all of us have worked.