Inside Out: From Building Startups To Funding Them
By Haley Kwait Zollo
For as long as I can remember, I’ve had a passion for shopping, stores, and their collective experiences. One of my most vivid early memories was shopping at a Nordstrom for the very first time. Walking into the kid’s shoe department (which I can still shop in today given my small shoe size!) I was overwhelmed with pure joy. The visceral reaction I felt was unlike anything I had ever experienced: the lights, the colors, the music, the variety of brands…all intricately displayed to make the most perfect customer experience. It was a dream.
Fast forward a few years and I, like every middle schooler, went through the Abercrombie & Fitch phase. I remember the day their website went live and I discovered online shopping for the first time. I was amazed at this new virtual world that had hundreds of items all in one place, and with the simple click of a button - boom - the items magically showed up on your doorstep.
Deep down I knew these consumer experiences are a part of my DNA. But when it came time to go off to college and choose a career path, I found myself on a different trajectory altogether. Instead of pursuing fashion, I went to the Kelley School of Business at IU and jumped into the world of accounting and finance. I loved the challenge and the rigor, developed an affinity for business, and was fortunate enough to land a summer internship at KPMG within the Transaction Services group, leading to a full-time gig upon graduation.
Those first few years were formative – from passing the CPA exam, to memorizing Excel shortcuts and living in messy databases, to pushing through PowerPoint presentation updates, I immersed myself in learning and observing in the “major league” of the business world. I was primarily focused on due diligence for PE M&A deals, and while I loved diving deep into the different business models and mechanics, there was this underlying feeling I couldn’t shake: I wasn’t happy, and something just didn’t feel right. I felt like I didn’t belong.
So, like any lost mid-20 something does, I started looking on Indeed.com and searched for some key terms, including “venture capital”, which at the time didn’t return many hits. But the search did return something that piqued my interest, a job for a financial analyst at Trunk Club. What was Trunk Club? Good question, because no one I knew at the time had heard of it either. But the position intrigued me enough to apply and before I knew it, I was inside the coolest looking office I’d ever seen and meeting the most awesome people. Clothes were everywhere, and there was a consistent buzz and undeniable energy that was contagious. I didn’t care what the job was, I just knew that I had to be part of this company.
I joined as the seventh hire on the finance team, and quickly spun out into a new data analytics and strategy team. Things were moving at the speed of lightning, urgency was everywhere, and the business was pouring out data left and right. From our warehouse operations, to customer service, to merchandising, marketing - you name it, we were analyzing it and running with ideas to test, iterate and learn so that we could move even faster.
And then one day, we piled into a room and were given news that we were being acquired by Nordstrom. You mean that store I’d been idolizing since I was a little girl?! I was floating on cloud nine. But it got even better - I found out that we were going to be testing a new Women’s division and product focus. I immediately raised my hand and said I had to get involved. This was an actual dream come true - the opportunity to build a brand-new business from the ground up…in fashion! Who was our target customer? What brands would she like? How would we reach her? How would we integrate this into the current business? Every question was a blank slate, and it was on us to figure out the answers. It’s through this experience I caught the “startup bug” and realized how much I loved building and hands-on operating. Getting to watch the women’s business grow from a Google doc to an eight-figure business in under a year was an absolute thrill and I needed to do it all over again.
So, I made the leap to an early stage start-up called Mac & Mia, a similar assisted commerce model for kids that was just starting to build out their executive team. Because we were a small team, I had exposure to everything: from scaling from 25 to 300 stylists across the country, to building out our data infrastructure and KPIs, to defining our marketing strategy to acquire new customers. But with that breadth came challenges I hadn’t foreseen, and I was pushed outside of my comfort zone in ways I couldn’t imagine. I got to see first-hand what raising a $5M Series A was like, from putting together the pitch decks to participating in board meetings. The highs were high, but the lows were low. And, I learned that resources aren’t unlimited, and growth is tough.
The Mac & Mia journey came to an early end – we were assumed by Stitch Fix - and left me at a crossroads. Where do I go from here --find a new startup to join? Start my own? I felt pretty lost. But there was one gut feeling I kept coming back to – this was an opportunity to break into Venture Capital. I was always fascinated by VC, and as an outsider looking in, I was intrigued by what the job even was. Sure, I’d gotten some exposure going through the fundraising process (and as a Shark Tank junkie), but I was curious what that world was actually like. I knew I loved building start-ups, and I was energized by the idea of getting to see the world from a different perspective after being so heads down in one consumer vertical. After learning a bit more and dabbling in some exposure (thanks to Ezra!) I became even more confident that this was the path I had to pursue next, and there was only one place where I wanted to do it.
I joined Starting Line because of my intense conviction in the investment team and exclusive focus on consumer at the seed stage. My innate passion for all things retail, coupled with direct operating experience at two consumer startups has wired me to be constantly obsessing over the future of consumer experiences and where it’s headed next. For example, according to BDO more than 7,000 stores have closed in 2019 which is already more than in any other full year. Retail isn’t dying, but it’s changing – fast. So, what’s next?
I’ve been inspired by emerging consumer unicorns like Glossier, Allbirds and Rent the Runway, but am even more curious about the infrastructure behind it all, what distribution looks like in an omnichannel world, as well as pushing the boundaries of personalization. I'm intrigued by how quickly the consumer landscape is evolving and have been thinking about what the near and long-term view of the world looks like. Launching a brand has never been easier or with fewer barriers to entry -- creating yielding a highly fragmented and competitive brand landscape. I've been fixated on understanding the players that are building around this ecosystem and how they will impact product discovery, trust and distribution. I've personally been very fascinated by the emergence of fashion-tech and how it will play a role in product creation, innovation and customer experience.
At Starting Line we’re at the ground floor, both as a fund and with the founders we work with. I’ve had the unique opportunity to live varied start-up journeys – from hyper-growth through acquisition, to wind down and sale. And through these diverse experiences, I’ve seen the power of data to build narratives and rally a team together to drive strategic action. Being fresh off two startup rollercoasters, I’m hopeful that these experiences will provide me with empathy, relatability and an understanding for what our portfolio companies are going through. I’m thrilled to be at the forefront of investing in the future of consumer, leveraging these learnings and insights to help our portfolio companies run even faster. I’m also humbled by the fact that I’m at the “starting line” myself in this VC journey, and eager to ramp up as fast as I can.
This is a dream opportunity, and I can’t wait for what’s ahead!