How This Young, Female and Latina Investor Broke Into a Middle-Aged, Male and White Industry

Ana Diaz-Hernandez is part of the investing team at Kapor Capital. Mitch Kapor and Freada Klein have been substantial influences in my career and that of my wife’s as well (Mitch was an original investor and Board chair of Linden Lab, where I worked, and my wife was ED of Level Playing Field Institute which Freada founded). Kapor Capital has some double bottom line principles they apply to investing and more generally, have been meaningful supporters of diversity in technology. Ana has been someone I’ve gotten to know better during the past two years and thought it would be fun to share her story.

Hunter Walk: Ok, a bit of backstory first. How’d you get involved with Kapor Capital?

Ana Diaz-Hernandez: I got into Kapor Capital the way many people get into venture?—?through my network. I grew up in southern Georgia and had no connection to Silicon Valley prior to undergrad at Stanford, so it was all new for me.

I fostered a personal connection with partners at the firm. I met Mitch Kapor and Freada Kapor Klein through mutual interests in advancing diversity in tech and began to learn about the great work they did through Kapor Capital and the Kapor Center for Social Impact. As a Latina in the startup world, the diversity work of the Kapor Center was very resonant. I had been interested in venture capital for a while, but it was our relationship, our values alignment, and the desire to work together on advancing social impact in technology startups that got me to join the team.

HW: Kapor Capital invests for social impact (in addition to financial returns) but that ‘social impact’ can mean different things to different people. How do you decide if a startup clears that bar?

ADH: Things that fit in our impact thesis* involve problems relating to addressing people’s most urgent hierarchy of needs: How do apps today get into the top 7 spot on a person’s iPhone? By addressing a need someone literally can’t live without.

We think tech has the opportunity to serve big markets of people that mainstream tech isn’t necessarily building products for: some of these markets include people of color, lower income folks, veterans.

We have 2 big principles:

a) You should aim to solve a problem that addresses people’s hierarchy of needs and serve a large, often underserved market. Our most frequent sectors are in Health, Edtech, Fintech, Labor platforms/Human Capital, and Urban Tech.

b) If lower income people can’t afford your product, there’s usually creative ways to think about reducing that cost to the end user. We look for entrepreneurs being creative on this front.

HW: You’re young, female and Latina in a venture world that’s largely middle aged, white and male. Do you see this industry changing over time?

ADH: I do see this phenomenon changing. Venture capital looks the way it does because the nature of the business is relationship driven. Increasingly, VC’s are realizing that addressing the needs of higher income people in urban areas won’t be enough to build many billion dollar businesses: that’s why they’ll eventually be drawn to recruit folks from more diverse perspectives to their teams to find deals that fit a different profile: that includes more women, people of color, and people who have personal experiences with social mobility.

I think a strong investor has good people skills, empathy, has strong product sense, has the ability to see problems from unconventional perspectives and suspend judgment, and has a good systemic view of the larger problems, not just following trends. Given these assumptions, there’s a whole lot of people who would be great investors and aren’t yet getting a shot.

HW: One sidenote on the Ellen Pao suit has been the debate around whether venture is still an “apprenticeship” business. Do you think so?

ADH: I actually attended the Pao trial earlier this week: it was a fantastic educational opportunity.

A big part of the testimony was around this issue of apprenticeship: Yes, I think pattern matching is a learned skill: we’re not born with this raw talent without tailoring it to the observations of the market. I think apprenticeship is one way to gain those skills. However, women (particularly women of color) can attest to how hard it is to get mentors.

In Pao’s case, she’s being slammed for being “too aggressive”, “back-channelling on deals”, or trying to lead on deals as a junior member of a team instead of paying her time as a “board buddy”: I find it hard to believe that a man doing those same things would have received the same response. Venture is a business where “aggressive” people (men) typically thrive, why would Pao not aim to do the same?

HW: Best career advice for people who want to try venture in their 20s?

ADH: The most valuable thing you have in your 20’s is your network. Build an amazing network of high value people, from many sectors, and you’ll be an invaluable member of a venture team. Nothing gets you ahead faster in venture than sourcing amazing deals because of your strong network.

I take my relationships very seriously: I believe deep, systemic issues require multi-disciplinary minds coming together. I work hard to bring together people who are taking radically different paths to address similar problems. It’s in those unconventional settings that amazing innovation happens. If you’re a driver of meaningful connections, people will want to work with you and you’ll be sure to have a place at the venture table.

* Kapor Capital invests in companies that close gaps in access to resources and opportunities for underserved communities, or otherwise engage in disruptive democratization of entire sectors. For more information on our investment criteria please visit our website: https://www.kaporcapital.com/criteria/

Want more of me? I blog at www.hunterwalk.com & tweet @hunterwalk