SC Moatti Founding Managing Partner Mighty Capital


Pemo Okay, welcome SC. Great to meet you, albeit remotely. I was wondering if you could tell me a little bit about what you like to invest in.

SC Yes, absolutely. I am the founder and the Managing Partner of Mighty Capital. We’re a venture capital firm. We invest at the Series A stage in companies based in the US. Mostly in technology, some life sciences and a good amount of fintech. And what really sets us apart is that we give our portfolio companies access to over 300 thousand Product Managers. They use that of course to hire them, but they also use that to accelerate their go-to market as basically a massive pool of potential prospects. And then they also use that to sell their companies.

Pemo Well, that’s fantastic that they have that and you give them access to that because I know, that would be a key point for most startups, correct?

SC Yes, it’s super important and what we’re finding is that a lot of startups now when they sell to Fortune Five Thousand they actually have to sell to somebody in Product Management. Whether it’s a Product Manager or a Director of Product or a VP of Product. If the Product Management function is not a buyer, they’re a key influencer in the decision. And it’s been accelerating with Covid where basically, you know, everything is digital now. So product management is a key function in Fortune Five Thousand companies.

Pemo Well, really good thinking on your part. I’ve always thought that it would be helpful for startups to also have access to some sort of sales expertise because often that’s not their expertise. So how do you cover that?

SC Yeah, so we actually not only give them access to that audience, but we also give them a playbook to turn that audience into a Go-to-Market Channel. So we help them with a lot of, you know, different digital marketing, different consultative sales approaches to help them be successful when they’re selling to Product Managers.

Pemo Fantastic. And so tell me some of the types of companies that you have invested in the past in your portfolio.

SC First I want to pause just a second because on the Zoom cast I see you like when you talk, but I don’t see me.

Pemo Ah, yes, yeah I can see your wavelengths, so no problem. Yeah, okay yes.

SC Excellent. So you asked about companies that we’ve invested in. So in our portfolio we have a lot of awesome companies. Some of them you will have heard about like Airbnb and Digital Ocean and Amplitude because they all went public in the last twelve months in 2021. It’s been a great year for us. And then others, like Accern, Safetrust, Bit Discovery, Sorcero.

Pemo Wow, congratulations. Yeah.

SC And all of these companies, they’re really enabling what we call the “”Age of Product”” so they’re basically leveraging the power of product to increase revenue, decrease cost, and improve productivity for their customers.

Pemo Fantastic, I don’t know if you know but many years ago when I first came to Silicon Valley, I did a project for a year on why women are funded less than men. So [it’s] great to speak to another female investor and I wondered how many women do you get, female startups coming to you?

SC Yeah, so that’s you know another part of our portfolio that we’re very proud of – is our diversity and inclusion. About a third of the companies we found are led by women and or minorities.

Pemo Oh good. Wow.

SC It’s not like it’s set-up to have any sort of, you know, diversity-angle, where we specifically want to invest in, you know, women and minorities. No, what we do, we say actions speak louder than words, so we rarely talk about diversity but we are by nature, and you’ll see if you go on our website and you know we have diversity in the general partnership: age, gender, race, nationality, religion. And so, because we are a very diverse team, we have created an amazingly diverse and inclusive portfolio.

Pemo Fantastic. So where do you think things are headed now? Obviously it’s been a couple of rocky years just generally for the whole world. What’s your perspective on where things are going as far as startups and investing?

SC Yes, absolutely. So we think it’s really the dawn of what we call the “Age of Product” . I was mentioning to you that with digital transformations. Sorry with Covid, digital transformations have accelerated by like 7 years or more, according to McKinsey.

Pemo Okay, okay. Wow.

SC Yes, it’s incredible. The consequence of that is that Fortune Five Thousands, they have to, you know, work with their customers through their digital product and so product is becoming like a massively important function in larger organizations and it’s becoming a strategic function. So I mentioned, you know, product is already making an impact in driving revenue growth, reducing cost, and improving productivity, but the other thing that we notice is just like, you know, 10 – 15 years ago, we saw the emergence of a new function in Fortune Five Thousand companies like marketing. We saw CMOs and everybody was like, “What are these Chief Marketing Officers doing?” like “They publish like tv ads? What are they really doing?” But today they’re one of the most powerful executives in the system and we see exactly the same thing happening with Chief Product Officers.

Pemo Yeah, yeah. Really okay.

SC CMOs today have more budget than Chief Information Officers and we think the same thing is going to happen with Chief Product Officers.

Pemo Well interesting. Well, I mean I would consider the Chief Product Officers more important, but I do know, after all the years of being in the Valley that many start-ups, when they get funded, the first thing they seem to do is either go to a marketing firm or employ marketing people. So what’s your take on that?

SC Yeah, I mean you and me both. I think product is absolutely the most important thing at a startup company because it’s what sets them apart and differentiates them. And I think the product is still relatively misunderstood. Just like I was saying, you know, now everybody says “Of course you need a Chief Marketing Officer,” but 10 years ago it wasn’t the case. So right now people say, “Do you really need a Chief Product Officer?” I guarantee you in 5-10 years, everybody will have a Chief Product Officer. Another way to look at it is to look at the number of tools that are part of the product stack and compare that to the number of tools that are part of the marketing stack. If you look at the marketing stack today, there are about 10,000 tools, seven years ago there were 2,000. Today there are 2,000 tools in the Product stack, so it’s growing really, really fast.

Pemo Right, right. So what advice would you give any budding entrepreneur at the moment, as to how to move forward and get funded?

SC Yeah, so a couple things. One, is if you’re building tools that make digital transformation possible or accelerate digital transformation, you’re in the eye of the tornado. You’re right where every Fortune Five Thousand wants to invest money, right? So you’re in the right place.

Pemo Yeah, yeah, yeah, right.

SC If you’re not, consider getting there. So if you are, you’re pretty much like our portfolio company, Amplitude -just went public and Spenser started it less than ten years ago and he just stuck with it for long enough that he became basically the best in the market. And if you have that kind of resilience and if you are stuck at a market that’s an explosion, like “The Age of Product”, these digital transformations, with resilience, with grit, with the right culture, the right approach, you’re going to be successful.

Pemo Right.

SC And there’s nothing like success to attract investors’ money. Money follows success, it’s not the other way around.

Pemo It also attracts more success as well. It’s a snowball effect. Ah yeah, you’re actually right. Yep.

SC You know what one thing I often tell entrepreneurs is I tell them to look at a balance sheet. What’s the defining, but characteristics of a balance sheet? It’s that you know assets equal equity in a startup company. You don’t have liabilities, you have just equity and so if you grow your assets, you’re going to grow your equity. If you grow your equity you’re going to make your investors happy because they’re going to get richer. So the way you grow your equity and you make your investors happy and you get more funding is by growing your assets.

Pemo Yeah, yeah. Alright.

SC And the way you grow your assets is with Cash, Accounts Receivables, so basically, with revenue, right? So more customers equals your investors. It’s really that simple.

Pemo Fantastic. That’s great advice. I notice also not just the digital explosion that’s happened out of the crisis, but also a lot more focus on climate change and how to do things better in that domain with nature? Do you have any comments or observations about that as well and how that’s going?

SC Yes, yes I think it’s really important and I think we’re still trying to figure things out in that department, out there as a civilization, as a society. At Mighty Capital, we invest that Series A Stage, so it’s sort of you know the way I see Climate change is the way I saw blockchain like 3 to 5 years ago. It was you know, really really interesting, but just a little bit early for Mighty Capital. Today blockchain is at the perfect stage for Mighty Capital, at that Series A stage where companies have developed really solid technologies, have some beginning of product market fit. They’re ready for growth. I see that for Climate Change in like 2 – 3 years down the road.

Pemo Okay, fantastic. Well, that’s good news for all the entrepreneurs that are involved in Climate Change issues. And I was wondering, I always like to ask investors if they have a funny or an unusual story to tell from their history from their past. Do you have anything that you could offer today?

SC So my husband would say absolutely not. I’m like the least funny person and maybe that’s what’s funny about me.

Pemo But nothing’s happened to you as regards entrepreneurs or someone you know, saying something or doing something that’s really crazy? I know Silicon Valley is full of those sorts of stories, so I just wondered.”

SC Yes, no of course, of course I have some funny stories I can tell you. You know a lesson I learned with some entrepreneurs who are full of ambition and really early in their journey, say “”Hey SC you talk about how generating revenue make investors happy but the truth is 3 months ago I was early in my journey I didn’t have revenue so I should have come to you 3 months ago because then I wouldn’t have had to measure myself against revenue growth and targets. I thought that was like a great way to communicate. You know so much passion and so much potential.”

Pemo Ah, yeah, yeah, yeah, great. Fantastic! Look such a delight to finally get to talk to you SC and I really appreciate your time today.

SC Same here. Thank you so much for reaching out and it was great to be on the show.

Pemo Fantastic. Well hopefully you’ll come again. I thank you so much!

SC I’d love to!