This interview is part of Hum-an Stories, a Q&A series with Hum Capital leadership providing a look under the hood at what drives Hum and its funding platform, the Intelligent Capital Market.
Meredith Parsons is a vital member of the Hum Capital team. As the VP, Strategy & Investor Relations, Meredith is responsible for Hum’s fundraising and investor relations efforts and a number of cross functional internal initiatives. Prior to Hum, she was the Head of Platform at Threshold Ventures (formerly Draper Fisher Jurvetson) and Head of Operations for the Enterprise Infrastructure team at Point72 Ventures.
Meredith is known for reliability, efficiency, and hyper organization and has experience successfully navigating both large firms and as a key driver at small and rapidly growing teams.
In this Q&A, Meredith discusses why she joined Hum to help reinvent the fundraising process, what the current market means for founders, and what success will look like for Hum at the end of this year.
Q: What excites you most about Hum’s potential in the industry?
For me, it’s the marketplace offering. There are a lot of fintech lenders out there, some investing off their own balance sheet, others with big institutional backers. There are also a lot of FP&A analytics tools. What I love about Hum is that we bring all this together into one marketplace – the diversity of the capital we can connect companies with is combined with their live performance data to move the process forward quickly and efficiently. Running a fundraising process is both expensive and draining – are you really getting the best cost of capital? What narrative should you be telling potential investors? How long is this process really going to take? By connecting their systems of record, Hum can give companies a clear picture into how an underwriter is going to evaluate their metrics and streamline the process of getting in front of lenders that we already know will be a match based on their credit box.
And the same goes for the investor side. Few investors will say they have a pipeline problem, but what they will say is that they spend a lot of time cutting through the noise to get to the signal. How do you decide where to dig in and when to pass? Getting deal flow that already matches your thesis and required metrics saves valuable time. And once a match is made, we continue to assist with speeding diligence along through a shared data room with downloadable raw data and analytics that investors can run their own sensitivity reports on and quickly process to put in front of their investment committee.
Q: Prior to Hum you worked at established and well known VC firms. What drove you to join Hum who is aiming to reinvent the traditional fundraising process?
At the risk of coming across as a total nerd, I love the venture community. Being on that side of the table, you not only get a front row seat to the frontier tech that is changing the way we live, but also get to develop close relationships with the founders that are bringing this technology to life. The system is far from perfect, and I wanted a chance to sit on the builder side and see what impact I could have on democratizing access to capital. I didn’t have a stereotypical VC education or career background, and I was drawn to the idea that using data to tell a company’s story could shift the power dynamic from who you know to what you’ve built.
Q: With the current market volatility and rising interest rates, many believe this will negatively impact investing and startup growth. What is your advice for founders on navigating the current climate?
What we are seeing so far is that for pre-seed and seed rounds, and for later stage/pre-IPO with strong numbers, the market is chugging along, perhaps with a slight course correction on overinflated valuations. Specifically for founders that are super early stage, I would say keep building towards product market fit and be mindful of your spend. With the number of seed and growth focused VCs that have recently closed large new funds, the capital is there. If you were thinking about raising this summer, it might be worth either kicking that fundraise off sooner or looking into raising debt to bridge until the fall when you are less likely to get caught up in a volatile market at a less desirable valuation.
For those that have already benefited from the crazy valuations and big equity rounds of the last few years but haven’t hit profitability yet, I would focus on your revenue numbers and on improving your LTV:CAC. If you are still pre-revenue, now is probably not the best time to go into hypergrowth mode, ramp up your burn and expect to have the market of 2021 to replenish your bank account. Investors are going to capitalize on the perceived slow down with term sheets at more modest valuations. I think we’ll see that for companies with a lower risk profile (good revenue numbers, low burn, with product market fit), but there will still be plenty of competition and rounds will get done.
It’s impossible to predict what the public markets will do, but given that a dollar today may be worth a lot less in a year, I think we’ll see smart investors be a bit more savvy about where they put that dollar.
Q: Fast forward to December 2022. What will success look like for Hum?
Success will look like Hum being the platform that investors refer their companies to first for debt financing. I think there is a unique opportunity for Hum to step into the light as the place where companies can come to get funded quickly and fairly from pre-qualified sources of capital. If companies are finding that equity isn’t as readily available, or the terms aren’t as agreeable, I think they will start looking for more ways to get financing and our marketplace is ready to fulfill those needs.
Q: Now for a fun question. Talk to us about your passion for Ultimate Frisbee and your experience playing collegiately and nationally. What are some lessons learned on the field and with your teammates that you bring to your job daily?
Absolutely! If you aren’t familiar with Ultimate, it’s a field sport played by teams of seven who are working to advance the disc into the endzone by passing to your teammates. If the disc goes out of bounds, hits the ground, or is intercepted, possession immediately changes, defense becomes offense and it’s off to the races towards that other endzone. It’s a fast paced sport requiring a lot of endurance and strength, but what I love most about the sport is its community and guiding principles of Spirit of the Game. Even at the highest levels, the sport is (largely) self officiated. Players need to know the rules, call their own violations, and resolve disputes on the field. In life, we don’t get a lot of opportunities to practice resolving conflict and acting with integrity when the stakes feel high. Ultimate has taught me so much about what it means to put the needs of the team first, dig deep to define my own character, and be reasonable even when I really want to be right! The sport has also taken me to the Middle East to coach Arab-Israeli, Israeli Jews, and Palestinans through a wonderful organization called Ultimate Peace, and to compete all over Europe and Asia at everything from World Championships to fun beach tournaments on the coast of Italy. These days I’ve hung up my cleats but continue to give back as best I can by sitting on the board of Bay Area Disc, the local non-profit serving the San Francisco Bay Area Ultimate community.