30/11/2021 14:18
Before helping to set up Newton Venture Program, Lisa Shu had a very linear career. Following a degree in psychology and economics she pursued a PhD in organisational behaviour.
“I decided in my early twenties that I would be a lifelong academic. I pursued that track for 12 years – all the way to the level of tenure-track professor. But, as I progressed and was approaching my tenure review, I found myself increasingly frustrated by the lack of impact that I could make within the academy. My published research was always behind a paywall. It’s extremely frustrating to do applied social science research, but not see it achieve any impact in the real world.”
During Lisa’s eight years of teaching MBA and executive education students at London Business School and the Kellogg School of Management, she noticed a shift in what they deemed to be the most desirable jobs.
“When I first started teaching, their most desired jobs upon graduation were predictable: banking, consulting, or big corporates. By 2019 it had dramatically shifted. People wanted to work in tech startups: the smaller, the better! And in the realm of finance, rather than traditional investment banking, people wanted to pursue venture capital with even more appetite for risk than private equity. So, it was a really interesting shift in mindset from my students.”
Reflecting on the potential driving forces behind VC’s sudden desirability, Lisa pointed to the great shift in the macroeconomy.
“We’re in the longest-running bull market in the public equity space. In the private equity space, the pace of tech advancement and tech-enabled solutions has exploded. VCs always speak about the exponential curve and exponential progress. It’s unlikely that we can go on this exponential curve forever. But, I do believe that we are in the midst of a step function in technological advancement, not just new software and hardware development, but also in life sciences, biotech, genomics etc. These seeds have been planted for a long time. For example, all the brilliant research that has been incubating in universities.
“When you combine the seeds of innovation with this increasing pool of private and public capital, you supercharge innovation and actually create products that can create solutions for the problems that we have. It’s a very exciting time, but it’s also very tumultuous. With a lot of wins, there’s also a lot of failure! But that’s the story of innovation.”
Despite teaching to always have another option lined up, Lisa left her academic role without anything to go to. Wanting to push herself and go against a stable and esteemed position, she was seeking out discomfort. Being in that uncomfortable space led Lisa to think of the skills she’d amassed over the years and where she could use them with most impact.
Working with mostly series B+ startups in an advisory capacity and helping them design nudges to promote behavioural change, Lisa recognised the struggle these companies had every 12-18 months with the next fundraising round. This took Lisa from the founder side to the VC side.
Saul and Robin Klein, founders of LocalGlobe and Latitude, were looking for a solution to develop and upskill their VC team. At the same time, Julian Birkinshaw, professor of strategy and entrepreneurship and deputy dean at London Business School, had submitted a proposal to UK Research and Innovation (UKRI) to develop a program to train venture capitalists. The two came together to create Newton Venture Program and put a call out for executive director.
“When the job popped up on Twitter from LocalGlobe to join as an entrepreneur in residence to incubate this idea, I applied as everyone else does – not knowing what it would grow into! In the beginning, Newton was just the seed of an idea: VCs need human capital development just like everyone else does, and it grew from there.
“Newton is a human capital development solution for the VC ecosystem. We upskill and train the next generation of VC investors. By 2030, our vision is that 50% of investors will be from typically overlooked backgrounds, including women, non-binary people, Black, Asian, and other minority ethnic groups. We’re passionate about disrupting the current landscape. From the very top, VCs hold the decision-making power of which companies to back and that determines which problems in society get solved. We think it’s unacceptable that VCs are not representative of the populations that they serve.”
VC is notoriously homogeneous - like attracting like - so it takes deliberateness to achieve diversity. “Newton is designed on the principles of what we want the venture capital ecosystem to look like: representative, diverse, inclusive, a place where people from all backgrounds can feel that they belong and that they can thrive in the long term. So, Newton exists to provide that opportunity.”
One of the ways to reduce barrier to entry is blind hiring. “For both programs, our application process is conducted through Applied – recruitment software that enables blind recruitment by design. This is intentional to deliberately guardrail against our own judgement and decision-making biases. We all possess some blind spots and biases, and Applied eliminates our ability to fall back on those biases.”
The other challenge is attracting those that don’t necessarily think they belong in this space. “You need to attract people from all the groups that you want to be represented in your cohort. So, I think that was one of the biggest learnings: the push is on the front end to attract people who don’t necessarily see themselves in VC, because – guess what? – VC doesn’t currently represent them! So one of our uphill battles was to change what’s in the VC shop window. We need to expand people’s mindset that VC can, should, and wants to include them.”
Thinking about the biggest lessons from setting up a not for profit, lisa encourages a change in focus from the company to the collective. “We intentionally set Newton up as a not for profit because its mission is to benefit the collective rather than the company and its stakeholders. It’s harder to identify how you benefit a collective as there are so many more stakeholders in the ecosystem. They need the same interest – to build a more robust, more diverse and more inclusive venture ecosystem that serves all and helps to achieve the mission. The trade-off is greater complexity for greater impact. But if you’re willing to make that trade-off, it’s incredibly rewarding to build it.”
See how you can start your venture capital career journey with Newton Venture Program.