Author: Audrey Vivas, BRV Fund Manager
Audrey: Can you share a bit about your background and what led you to venture capital?
Parker: My path into VC is a little unorthodox. I fell in love with VC, and startups in general, while taking a Technology Entrepreneurship class my sophomore year of undergrad. This led me to intern at a consumer budgeting app startup that summer, and at JetBlue Tech Ventures the following summer. From those experiences, I knew my end goal/dream job was to become an early-stage tech investor, but wanted to build some outside experience/operating chops before I would get into the field.
After school I worked as a management consultant for a little over two years at Alvarez & Marsal working for large corporates and private equity owned portcos on the ops improvement team, where I was a big data specialist. I then joined the buy side at A&M Capital working in their strategic co-invest fund investing minority equity alongside other PE Sponsors in deals of their expertise, with transactions ranging from growth to buyout. While at A&M Capital, the genAI boom took off once GPT-3 came onto the scene, which prompted many PE firms to start seriously considering how it could impact their businesses. I then became Head of AI for the entire firm, where I led the evaluation of all AI-related opportunities as it related to A&M Capital’s investment and partnership-related activities. In this role, I became incredibly excited by the potential of AI-powered workflow automation tools designed to boost the productivity of knowledge workers. Eventually, me owning this thesis enabled me to break into the VC world.
Audrey: What drew you to specialize in AI and B2B software?
Parker: I took a good amount of data science coursework in undergrad through which I developed a keen interest in AI and have been tracking it since.
Audrey: What key factors do you look for when evaluating early-stage AI and B2B SaaS startups?
Parker: From my perspective, at the app layer, key factors include (but aren’t limited to):
- The right team to solve/alleviate the problem
- Large TAM
- Quantifiable ROI to the customer that resonates
- A defensible data moat
- Solid unit economics
Audrey: How do you assess the potential of founders in the AI space, given the rapid pace of technological development?
Parker: Ideally, I look for founder pairs that possess 1) industry/workflow empathy and 2) technical expertise. Many AI-centric startups I’ve seen that have struggled to gain traction struggle with communicating the ROI to their prospective customers.
Audrey: What current trends in AI and B2B software are you most excited about?
Parker: Broadly, I’m a fan of Vertical AI-Centric app layer startups; personalization/tailored use cases are now possible with the latest advances in the underlying technology, which can tailor to niche customers who are willing to pay more (on an ACV basis). Additionally, vertical applications that are embedded into the workflows benefit from higher usage, which then allows the creation of data moats.
Audrey: How do you see the intersection of AI and other sectors evolving over the next five years?
Parker: I think there’s an element of “trust to be earned” from many sectors including Marketing and Finance that will come over the next couple years. With customer fears of AI models hallucinating being a prominent issue, this will alleviate over time as the underlying foundation models continue to improve.
Audrey: What’s one piece of advice you would give to someone looking to break into venture capital, especially in AI?
Parker: Having a differentiated thesis/point of view to back up from experience is a great “leg up” when applying for VC jobs. Building relationships with founders early on, offering to help them however you can, and then introducing them to VCs is also powerful. The best way to get the job is to audition for it!
Audrey: How has your background in Management Science & Engineering influenced your investment approach?
Parker: The MS&E major at Stanford is interdisciplinary in nature, balancing heavy technical coursework with the qualitative. This is highly representative of the type of skills you need to develop as a VC to do the job effectively.
Audrey: Can you share a significant learning experience in your career that has shaped how you view investments today?
Parker: Demonstrating workflow empathy and understanding how to speak the customer’s language is incredibly important in order to win. I learned this early on as a management consultant working on large corporate transformation projects, where getting buy-in from major stakeholders in understanding their work at a highly detailed level was critical to a successful project outcome.
Audrey: What excites you most about your work at Communitas Capital right now?
Parker: Given the small team, our culture is highly entrepreneurial which is one that I thrive in and thoroughly enjoy.
Audrey: Are there any resources/books/thought leaders in the AI or VC space that you recommend?
Parker: The following books are awesome: Zero to One (Peter Thiel), Venture Deals – Be Smarter than Your Lawyer and Venture Capitalist (Brad Feld and Jason Mendelson), Secrets of Sand Hill Road (Scott Kupor), Lean AI – How Innovative Startups Use Artificial Intelligence to Grow (Lomit Patel).
Audrey: Any final thoughts or advice?
Parker: VC is a demanding but incredibly rewarding profession. While tough to break in, enthusiasm and infectious curiosity combined with a relentless work ethic will significantly improve your chances of getting there!