Cassie Ann Hodges

by & filed under Building Better, NVCA Blog.

Welcome to the NVCA Blog series, Building Better, where we celebrate the dynamic relationship between our VC members and their innovative portfolio companies around the nation. For today’s Building Better, we spoke with Tom Walker, President & Chief Executive Officer at Rev1 Ventures, and with Phil George, Co-Founder & CEO of MentorcliQ, a Rev1 portfolio company. Learn about their partnership in the Q&A below!

Rev1 Ventures: Tom Walker, President & Chief Executive Officer

Rev1 Ventures Tom WalkerGive us some background on Rev1: How did the firm start, what is your mission and how does the firm strive to meet its goals?

Rev1 Ventures manages seven active venture funds, with $90M in total capital under management. An investor startup studio with a mission of helping startups scale and corporates innovate have a proven track record of investing in high-potential startups and, along with our partners, are committed to advancing innovation in early-stage, high-growth ventures. Rev1 pairs and deploys very strategic services—such as talent, corporate connections, and infrastructure—alongside seed capital to help startups overcome what we call the “knowable unknowns.” Our business grew out of the desire and commitment of leaders in our community—from both public and private sectors, including leadership from our globally recognized research institutions and corporate base, to develop Central Ohio as a national hub for entrepreneurship and innovation. Rev1 has invested in more than 100 companies, making us among the most active VCs in the U.S. for the past five years and a top seed investor nationally.

What does Rev1 Ventures look for in a partner when choosing to invest in a portfolio company? What does Rev1 value? What do you value in the MentorcliQ team?

We look for entrepreneurs and innovators who are solving big problems. Early proof of customer interest, as evidenced by real data, is what we value most and an essential element for which we help our entrepreneurs solve. We invest in high-growth, advanced technology businesses that are  going to make big disruptive changes that help humanity or that have amazing new products that solve problems or create new opportunities for large markets and industries. Much of our work falls into software/IT and life sciences, including therapeutics, medical devices, and healthcare technologies.

Beyond early product-market fit, we look for entrepreneurs with character and the highest degree of integrity. We seek out leaders who demonstrate the balance between tenacity and patience that is required to carry a new company through the good and the bad, through windfalls and ravines. We do look for experience and demonstrated competencies—either in C-level management, marketing, finance, or product development. We also expect entrepreneurs to be cash savvy, to spend every dollar like it’s worth a hundred. We like it when they are energized by working with a Board. We favor entrepreneurs who demonstrate the confidence and maturity to raise capital and are coachable—individuals who recognize that they don’t and can’t know everything, and that we all can benefit from mentorship and support from one another. For early stage investors like Rev1 (we are often a startup’s first source of capital) long relationships are expected. I was trained as an engineer and one of the characteristics of that profession that has been a North Star for my career and in building Rev1 is that work should be committed to serving society, attending to the welfare and progress of the majority. We look for partners that share that belief and that employ inclusion and diversity in their entrepreneurial endeavors.

We want to invest in entrepreneurs and founding teams that succeed and that we will be excited to work with for the next five or ten years. On both counts, MentorcliQ is one of those. Their business idea is visionary—to create a full-featured mentoring software system to help employees and companies handily gain the advantages that mentoring provides. In this time of virtually full employment, when talent retention is at the top of every company’s list, MentorcliQ is improving mentoring for a million employees. From day one, CEO Phil George has been an inspiring entrepreneur with a huge capacity for work and a strong empathy for his employees and customers. He and his team are open to suggestions from our first meeting and remain coachable to this day. Phil is a decisive leader who makes his own decisions and yet is open and fully transparent with his investors. He tells us where he needs our help; he knows how to use our resources to make the business grow. In the seven years we have been together, he and the team at MentorcliQ have grown a really meaningful and impactful company. They are fearless when it comes to accepting input from their customers. They make plans and evaluate alternatives before they spend their capital. They have built a culture of inclusion and respect.

How does Rev1 support its portfolio companies? How does it help entrepreneurs grow and advance the VC industry?

As an investment firm,  our startup studio approach to supporting portfolio companies is laser-focused on delivering the help that entrepreneurs need at the time they need it. Our resources and support range from providing access to a continuum of capital–from seed to later stage—, to providing access to local service providers who are experienced in the specialized legal, accounting, or business development services that a startup uniquely requires, to connecting startups with corporations who need their products and services and can become their customers. We advise our portfolio companies on how to match critical milestones to the appropriate sources of capital. We help them become realistic about valuations and terms. We leverage our relationships with other investors, including VCs from in-state and beyond, as well as corporate, community, and state partners and resources such as Ohio Third Frontier, to syndicate strategic co-investors for larger later rounds. When a portfolio company needs experienced senior leadership or a board member with particular expertise, we identify candidates.

I’ve had the opportunity to create venture funds in markets that have traditionally been underserved. Our model of investing has opened up the region, where traditionally venture capital has been limited, to investment from VCs in other parts of the country. By helping develop and curate a robust, well-vetted pipeline of deals, we attract outside investors to interesting opportunities that they ordinarily would not see. For example, in 2018, Rev1 co-invested with 65 VCs around the country and globe, representing 21 states. Of those, seventeen were from the coasts—nine from Silicon Valley and eight from Boston, New York, and New Jersey.

Additionally, we support startups at the earliest stage. We help them get through prototyping and market validation. We help our companies built strong management teams and cultures that make these businesses great places to work. Our track record of investments adds significantly to the pipeline of well-vetted companies for later-stage investors as well as helping current investors to raise additional funds. Our VC co-investors appreciate the thoughtful approach we take at the earliest stages.

MentorcliQ: Phil George, Co-Founder & CEO

What is the mission of your company and how did you start? How has your partnership with Rev1 Ventures helped you fulfill your mission?

MentorcliQ is a relationship-based employee development platform that drives employee retention by connecting employees with the right person to help them excel at their company and in their career. Our name, MentorcliQ, is derived from the idea of helping employees find a Mentor at the Click of a button. The idea started when I personally experienced the pain and ineffectiveness of launching a mentoring program for high potentials at my previous company. After surveying the market, lots of companies were struggling with these types of employee development programs, but there wasn’t a good solution on the market. Today, companies use our platform for all types of employee development programs including those focused on career development (like a high potential program), programs focused on functional expertise (like a sales enablement program), and programs focused on diversity and inclusion (like a women’s network program).

From the very start, Rev1 Ventures was there to help MentorcliQ get off the ground and has been there to support us every step of the way. Before the company even had a customer, we began working with Rev1 to develop a business plan and a go-to-market strategy. Fast forward seven years, and MentorcliQ is now thriving with a market-leading solution that is used by world-class companies like Cardinal Health, American Airlines, and Clorox. Rev1 provided MentorcliQ with office space early on, free and/or discounted professional services for critical functions including legal and accounting work, access to expert advice through its advisor network, introductions to corporate companies who turned into customers, referrals to talented individuals who joined the team, and ultimately capital to fund the growth of our business. Rev1 Ventures’ CEO, Tom Walker, sits on our Board, and he has personally made introductions to companies who are limited partners of Rev1 funds and are now MentorcliQ customers.  

What problem is your company trying to solve for? 

Fifty years ago, companies were less global than they are today. Companies were centralized; employees often times stayed at their companies for decades, so they came to understand how to navigate it. Today, companies are global. Many employees work remotely or in satellite offices, often times as part of an acquired company. Employees are expected to be effective immediately without the benefit of knowing who to approach or how to gain the critical knowledge they need. 

MentorcliQ helps make the world smaller for employees. We help them quickly find a person who can help them plan their career, help them solve a problem, or help contextualize their work in the framework of the company’s mission. As a result, employees are more engaged in their daily work, which leads to increased productivity. Employees are more prepared for leadership roles, which leads to more promotions, And, ultimately employees more buy into their company’s mission and vision, which leads to higher employee retention. Each of these three values is good for the employee, and also very, very good for the company. 

Where and how is your company looking to grow in the next 5 years?

MentorcliQ continues to expand globally with our customers, and over the next five years, employees will make more connections on MentorcliQ than ever before. MentorcliQ delivers return on investment to our customers for employee development programs that often didn’t have effective measurements. We consistently demonstrating improved employee retention of 30 to 60 percent per year for those employees who use MentorcliQ. That ROI goes up with the more connections an employee makes. We will help our customers tell the story of their success to inspire other companies to provide an engaging environment for their employees. One area of particular growth is diversity and inclusion. Companies have been investing in acquiring more diverse talent for a long time, but they have uninvested in keeping that diverse talent once the person joins their company. MentorcliQ is providing a measurable impact by connecting employees with others who help them feel more connected to their company and more engaged in their daily work. 

How has Rev1 impacted your company’s future for the better?

Rev1 fills a critical capital gap in Ohio and the Midwest. Ohio has talent but needs an engine to help convert talent and passion into great companies. Rev1 Ventures did that for MentorcliQ, and it is doing that for many other companies in the region as well. Companies need concept funding to help them vet out their idea, seed capital to help them find product market fit, and then follow-on investments to scale the business. Rev1 provides the right expertise and support at each stage of this capital continuum and also provides the capital to make it happen. Rev1 Ventures takes a wholistic approach similar to an accelerator, but instead of supporting a startup for 10 weeks, Rev1 supports the startup for years to help build great companies in its backyard. MentorcliQ is an example of what is possible when a startup receives the right support at the right time, just like the employees we impact. 

Tom Walker has been at the center of this startup revolution in Columbus, Ohio. Tom came to Columbus in 2012 to lead Rev1 Ventures, and when we began working together, I read Tom’s book entitled The Entrepreneur’s Journey: A Handbook for High Growth Companies. The book lays out the critical milestones an entrepreneur must accomplish, and the support they require along the way. Our region was missing some key services and capital support points for entrepreneurs. In founding Rev1, Tom and team created a support system for entrepreneurs to launch high growth ventures from the Midwest.