Profiles In Venture: Clocktower Technology Ventures' Adriana Saman

Want news on the hottest startups delivered to your inbox weekly? Subscribe to my mailing list, Founder to Founder (F2F): f2f.substack.com. Check out my latest F2F story: Startup Spotlight #10: eFuse.

Adriana Saman is part of the investment team at Clocktower Technology Ventures. Prior to Clocktower, Saman was a Strategy Associate in Chase’s Digital Payments team where she worked closely with all consumer-related payment products to develop consolidated roadmaps, business cases, and strategic initiatives. Before joining Digital Payments, she worked at J.P. Morgan as an Investment Banking Analyst focusing on M&A transactions across Latin America. Saman is originally from Ecuador and holds a B.A. in Political Science from the University of Pennsylvania.

Daso: One of the most common routes to VC is Investment Banking. What were some of the skills you picked up at JP Morgan that unexpectedly helps you do your job every day at Clocktower Technology Ventures?

Saman: As an IB analyst, you are expected to work on multiple projects at a time, balancing simultaneous hard deadlines and a very low tolerance for mistakes. As a result, I developed the habit of operating with a constant sense of urgency and responsiveness that has proven to be indispensable in venture—deals move fast, founders expect due diligence (DD) to be done, and tight deadlines are just part of our day-to-day. (Due diligence is the process of systemically assessing the current state of a prospective investment.) Knowing how to function in this kind of pace while staying proactive and efficient has been invaluable for the job. Moreover, the expectation of high work quality and precision forces you to develop an incredibly strong degree of attention to detail as a junior in banking—this has been handy at every step of a transaction, from performing initial diligence to reading through closing docs.

Daso: How has your IB background in M&A influenced how you perform due diligence of potential investments?

Saman: I was a part of J.P. Morgan's Latin America M & A advisory team, industry agnostic. The constant exposure to new verticals with an embedded expectation of quickly getting up to speed on an ad hoc basis allowed me to form a DD mental framework that is, in many ways, analogous to early-stage investing. First, I learned how to familiarize myself with industries and markets where there's minimal data / public information available and to feel comfortable making certain assumptions without all the datapoints that one would generally expect to have. Second, the exercise of valuing corporations with a long cashflow history and peer benchmarking has impacted the way I think about price discipline when investing in earlier stage rounds. I learned to be thoughtful about a company's valuation and identify the kinds of milestones that would take to grow into its asking price (and whether it feels realistic or not). Third, just generally understanding the big picture of what a viable business looks like from an operational and financial point of view is often a helpful perspective when analyzing the feasibility of a startup's unit economic goals.

Daso: What are some of the enduring trends you're seeing in Latin America when it comes to FinTech?

Saman: I think this is prime time for Fintech investing in Latin America. The more time I spend connecting with founders in the region, the more excited I become about the opportunity. These are 3 of the trends that I find are most prominent now:

1. COVID as the tipping point in the acceleration of digital payments adoption: LatAm is primarily a cash-based economy. While e-commerce and POS digital payments had been quickly growing over the past several years, they still represent a tiny portion of all payment transaction volume. I think a big part of this phenomenon is not only cultural but also due to the historically weak payments infrastructure in these countries. The need to transact digitally in the current environment forces many merchants to digitize quickly and push a lot of consumers to change their traditional cash-based habits. I see a massive opportunity for neo players across the entire payment processing chain (and adjacent services) to gain market share and improve the tech stack and experience behind digital payments.
2. The surge in neo-SMB banking and alternative lending services: SMBs have historically been a sophisticated client to serve traditional banks in the region due to the lack of data available to properly underwrite a business's creditworthiness. Innovators in the fintech space are now building the first SMB / startup focused banks that provide a customer-first, holistic banking experience to this massive, yet fragmented, market segment. That being said, Ithink we should also keep in mind a potential defense strategy, with API-based alternative data providers that could enable incumbents to become competitive in the SMB lending space.
3. A growing number in replicas of successful business models in the US with a local twist: the pace of innovation within financial services has moved so quickly in the US that there are many successes and failures to study. While not 100% is translatable to the local dynamics of the region, they serve as useful frameworks to build businesses across all verticals of Fintech. As founders gain more access to and understand American models, we'll continue to hear a lot more of "[X] for Latam" that also encompasses a faithful adaptation to local culture, regulation, etc.

Daso: What lessons could American tech entrepreneurs learn from their Latin American counterparts in the FinTech space?

Saman: Venture is still a relatively nascent source of capital in the region. As such, the appetite for risk has been comparatively less aggressive, and the availability of capital much lower than in the US. Founders are often required to bootstrap much longer (a few years sometimes) before becoming attractors of external investment. I think this dynamic can shape founders to become examples of next-level resourcefulness, grit, and creativity. On the other hand, there is a degree of boldness that I genuinely admire, as it takes a lot more effort to fundraise outside of your cultural and lingual comfort zone. Pitching a company and conveying your passion in a non-native language is not easy!

Daso: How have you developed your unique value-add in supporting your firm's portfolio companies?

Saman: Ever since I started in VC, I have spent a considerable part building meaningful relationships with lots of players in the fintech ecosystem, ranging from investors to corporate partners and incumbents. At Clocktower, we place particular emphasis on acting as connectors to our founders. We are particularly proactive about introducing them to folks that we meet and believe could make great partners. Whenever I speak with a colleague in my network, I adopted the habit of asking myself, "which CTV founder could benefit from talking with this person?" Lots of great introductions (and happy founders) have come out as a result!

On the other hand, spending all my time living and breathing Fintech is very useful for founders in our portfolio. Seeing lots of decks and meeting lots of companies across all verticals within the space has allowed me to improve my understanding of our founders' markets continuously. Studying significant raises and exits in the space, continually learning about general valuation benchmarks versus goals achieved, and keeping the newcomers' live pulse in this world always leads to highly productive conversations with CEOs. I have noticed that founders are often so immersed in their day-to-day activities that sometimes it is quite helpful for them to get a current, up-to-date view of the bigger picture when bouncing ideas around potential strategic decisions.

Daso: What are some things in tech and venture that aren't talked about enough?

Saman: I find that we talk a lot in tech and venture! We operate in an ecosystem that has been designed around fluid and increasingly candid exchange of ideas across events, panels, coffee chats, blogs, tweets. I honestly do not worry that we do not talk enough about specific topics—I worry more about the things that are still not done enough. One problem I feel very strongly about improving is the count of minority founders in most VCs portfolios. I think this issue is particularly tricky as it requires a lot of proactiveness on investors' side to find creative ways to source a more diverse top of the funnel, to begin with. I have found that mentorship programs, office hours, and minority-focused networks have been quite effective in beginning to broaden my scope of founders I meet. (I have discovered new practical ways to be helpful to these founders along the way). I have made a personal commitment to devote a more significant part of my time to these initiatives and would highly encourage my peers to do the same—feel free to reach out if you want any ideas on ways to get involved!

We talk enough; I'm not worried about that. Instead, I worry that we're not often acting on what we so often like to philosophize about.

Want news on the hottest startups delivered to your inbox weekly? Subscribe to my mailing list, Founder to Founder (F2F): f2f.substack.com. Check out my latest F2F story: Startup Spotlight #10: eFuse.

If you enjoyed this article, feel free to check out my other work on LinkedIn and my personal website, frederickdaso.com. Follow me on Twitter @fredsoda, on Medium @fredsoda, and on Instagram @fred_soda.