Michael Smerklo is Co-founder and Managing Director at Next Coast Ventures. We have a terrific conversation about a range of issues including solo founders and their ill-treatment by VCs.
Sramana Mitra: We are going to start today’s session with a conversation with Micheal Smerkio, co-founder and managing partner at Next Coast Ventures. Welcome back to the show.
How have you been through COVID? How is the firm? How are your portfolio companies?
Michael Smerklo: It is a fascinating time, right? We are now starting to figure out what the new normal looks like. It has been an interesting tale of two cities from the global pandemic. There has been a lot of tragedy and hardships. I don’t think that there has been a harder time to be an entrepreneur. It is always hard, but throw in running the business, then having the global pandemic, and social and political unrest.
For us as a firm, it has been pretty good in that we invest in long-term themes. A lot of the themes that we had invested in over the last several years got accelerated by COVID. We think a lot of them are going to continue to accelerate the innovation that we invested in.
It’s a tale of two cities. The pandemic brought whole sorts of physical and emotional challenges for everybody but from the innovation perspective, it has accelerated a lot of themes that we have invested behind.
Sramana Mitra: Let’s double-click down on those themes. What are the themes that you have invested in that have accelerated in COVID?
Michael Smerklo: We wanted to be thematic. Some of the themes that we invested in were in the future of work and the future of retail. We call it the software 3.0, which is the continual evolution of enterprise SaaS and how that has changed. We also did some things around personal health care. Those three accelerated.
I believe that a lot of the trends and changes in human behavior that happened with COVID are long-standing. We don’t think that they are temporary. We spent a lot of time thinking about what stays and what is temporary. I put travel, going to sporting and music events as events that humans are going to go back to after vaccination.
There is the other end of the spectrum of things that I don’t think will ever go back. That includes going to see a doctor or how organizations are managed as examples of things that won’t go back to before. There are also some that are in the middle of that spectrum. Unfortunately, some of our early themes were in that don’t go back category.