Emanuele Levi (360 Capital Partners): Our history of finding successful companies that we have been able to support since their very early days and have worked with for many years speaks for itself
08 Oct, 2021
Claudine Emeott is Senior Director of impact investing at Salesforce Ventures. In 2011, she left a consulting job in Chicago to move to Kathmandu as a Kiva Fellow, which opened her eyes to the power of technology to address some of the world’s most pressing challenges. After spending a year in Nepal, she moved back to the U.S. for a full-time role with Kiva. She joined Salesforce in 2017 to lead the company’s first Impact Fund.
My career has always been in impact. I spent the first half of my career in economic development consulting, both in emerging markets and in the US. Later I pivoted into this intersection of tech, impact, and investing. I spent 5 years at Kiva, one of the earliest crowdfunding platforms, with their investment team. Kiva is unique for its credit solutions for social enterprises and microfinance institutions. I loved working in a tech startup with a strong mission and making investment decisions. When I saw the opportunity of Salesforce to be the first on the ground, leading a new impact investment initiative, it was really exciting to take what I had built in impact investing at Kiva and do it in a different context and on a bigger platform. And this platform is one that has always had a strong social mission, rooted in the notion that business can be a powerful platform for change. So, I joined Salesforce in 2017 to lead the first Impact Fund.
With the Salesforce Ventures Impact Fund, we invest with the same core strategy as other Salesforce Ventures funds, meaning that we’re looking for enterprise software companies that can integrate their technologies with our platform. In addition to that mandate, we’re also looking for companies with demonstrable social or environmental impact. For every potential investment, we try to solve three things: financial return, strategic integration with our platform, and impact. This means that we are different from a traditional investment fund that’s only looking for a financial return because we also need to demonstrate a strategic integration and measurable impact. We are different from philanthropy because we’re looking for a financial return.
I wouldn’t say that this company is the most unusual, but it is exceptional in the impact that it’s having. In 2019 we invested in Unite Us, which is an outcome-focused technology company that builds coordinated care networks of health and social service providers. The company’s platform interconnects providers around each patient and integrates the social determinants of health into care delivery. The platform tracks clients across independent agencies and provides private and non-profit agencies with the ability to seamlessly integrate care delivery to improve overall health, increase efficiency, and lower costs.
There’s really no conceptual difference between the two funds – our Fund II is built on the success of our Fund I. We launched Fund II at the height of the global pandemic and alongside other concurrent and intersecting crises — an economic fallout, climate change, systemic racial injustices. With this backdrop, we are even more attuned to the fact that our investment strategy should build a more inclusive and more resilient economy. We are continuing to invest in the same verticals and spending a lot of time in spaces like workforce development, sustainability, and financial inclusion, and, again, how we can create prosperity for a wider swathe of the world population. It is really about taking Fund I and accelerating our work.
It’s a combination of both. We are lucky to work with great investors. We typically do not lead rounds, so we rely on other investors and we are great at sharing deal flow. And it goes both ways: we might share a company that is too early for us and pass it to earlier-stage investors. We are also proactive in how we’re building our pipeline, increasingly developing a thesis-driven approach and building out specific points of view on where we want to invest. In those cases, we activate our efforts in finding companies that fit these strategies.
As I’ve already mentioned, we look at every deal from three perspectives – financial return, strategic integration opportunity, and demonstrable social and environmental impact. We typically invest in Series A through Series C stage companies.
We have been doing a lot of work in Sustainability, and this is a huge area of interest not only for the investment team but also for Salesforce at large, with a lot of existing initiatives happening across the company, whether it is our Sustainability Cloud product or our own corporate goals for sustainability. We see increasing opportunities for partnership and integration with younger companies that are building solutions that can plug into our product and further our sustainability goals. Because of the ticking time clock on climate change, we believe strongly that this is where we should be spending a lot of our energy and efforts.
The majority of our investments today have been in companies that are based in the US and largely serving enterprise customers and users who are based in the US. But we do have a handful of more globally focused investments. Andela is working across Africa. Crehana is working across Latin America. We are definitely open to doing more investments globally and are expecting to see more and more deals from outside of the US.
In terms of the timeline, it’s variable and depends a lot on the company’s processes and also on when we come into the game – are we late or the first investor they have talked to? If we were very early in the conversations, we take a back seat, while companies are focusing more closely on securing a lead investor and a term sheet. The process typically takes somewhere between 4 weeks and 8 weeks and even longer in some cases. It is, also, relationship building – we get to know a company, and if they’re not fundraising now, we start the conversations early because we like what they’re doing and look for adding value, even before there will be actual fundraising.
Our range for the Impact Fund 1 was between $1M and $5M.
As an impact-oriented fund, we expect companies that are pitching us to articulate a strong impact narrative; if this component is not clear in their presentation, it’s a red flag to us.
I do want to see a founder who is driven by the ambition to solve a big problem from both a market opportunity and impact standpoint. I’d also like to see their ambition complemented by humility and empathy for the end-users that their solution serves. Diversity in a team is also very important, both in terms of background and experience.
We don’t invest before Series A, so when a company is ready for us to really dig in and take a look, there is already a team in place. They are looking for institutional funding, have product-market fit, and have revenue. We’re lucky to work with some of those investors that fund early-stage companies and join them in later stages, but we’re not suited to work with those companies directly.
I’m really interested in what is going on in Sustainable Food and Agriculture, but for us, it’s not a focus area because it’s typically a bit removed from enterprise software solutions.
Interestingly enough, COVID brought us closer to our portfolio companies, even though we couldn’t gather in person. We work really hard to find ways to bring our portfolio together for conversations with experts from Salesforce to add value in these challenging times. For example, we brought in someone to talk about how to support employees in the first months of the pandemic, when there were so much uncertainty and stress. We also brought in leaders to discuss sales and customer success during the time of Covid. Through this programming, we have not only connected our portfolio to Salesforce experts but also to each other, and it’s been very valuable.
My answers will probably mirror many others’ responses to this question. Off the top of my head, I would say Apple for designing brilliant consumer hardware, Google for revolutionizing search, and Salesforce, of course, for transforming the cloud.
You certainly need to hustle. In this competitive funding environment, it is important to get in front of companies early on, articulate your distinct value, and start building a relationship. I also think it’s important, though, to be yourself; I personally do not project nor respond to bravado, so I like to engage with intellectual curiosity and compassion.
I love hiking. That is a very convenient, COVID-friendly hobby, and I try to involve my family and children. Luckily, we live within walking distance from great urban hikes. This is how I’m doing a lot of my thinking these days when I’m able to steal a few minutes of fresh air and quiet.
I feel very lucky to be where I am. Impact has always been a guiding principle for my career. When I graduated from college, I never would have imagined that I would work in the VC world. Now I couldn’t imagine being somewhere else. I feel an immense privilege to be leading the Salesforce Ventures Impact Fund and support the incredible entrepreneurs we fund. I feel that I have a lot more to do and a lot more to learn and to give.
Number 1: Be specific and deliberate with the investors that you’re targeting – have a reason for reaching out to them. You should be diligencing them as much as they are diligencing you, and you should know why you want to bring them into your company at any particular round.
Number 2: Invest in your team and culture as much as your growth. Create a company that people really love to work for and want to work hard for. It’s again about human empathy and humanity, thinking about the people you are serving, and keeping them at the forefront of your company’s goals.
Number 3: Be adaptable – launching and running a startup relies heavily on your ability to adapt in many ways and this has been especially true during the past year.