20VC: CEO Whisperer Jerry Colonna on How Investors Mimic Aggressive Behaviour To Cover Insecurity and Why Vulnerability is Key To Success In VC

Jerry Colonna is a Founder @ Reboot, the coaching company that helps some of the world's greatest entrepreneurs and investors with the internal ups and downs in their life and support the growth they need to improve their performance. Prior to Reboot, Jerry was a Partner @ JP Morgan. Before that Jerry was a VC, having launched Flatiron partners in 1996 with his partner, Fred Wilson. Flatiron became on the of the most successful early stage investment firms in New York with investments in the likes of Geocities, Gamesville and The New York Times Digital. In Today’s Episode You Will Learn: 1.) How did Jerry enter the world of VC and then make the transition to be the ultimate CEO/VC coach, aka, 'The CEO Whisperer'? 2.) What is Jerry's first step for anyone looking to self-evaluate in what Jerry calls, 'radical self-inquiry'? 3.) Once self-evaluated, how can one look to be their true self in a world that is not necessarily accepting of such vulnerability, compassion and emotion, for example, VC and startups? 4.) How does Jerry evaluate the current crop of VCs in terms of them being their inner self to the external world? Why is Jerry so optimistic? 5.) Questions from Brad Feld: 1.) What should VCs be spending more time on? 2.) If Jerry could give one piece of advice to VCs what would it be? Items Mentioned In Today’s Episode: Jerry’s Fave Blog: Fred Wilson: AVC, Brad Feld: Feld Thoughts, The School of Life Jerry’s Fave Book: When Things Fall Apart As always you can follow The Twenty Minute VC, Harry and Jerry on Twitter here! Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC. The Twenty Minute VC is proudly sponsored by Luma, Luma is the world’s first ever Surround WiFi system that brings speed, security and control to the home network. And Unlike traditional routers, Luma comes in a pack of two or three sleek devices to place in different rooms in your home. Luma then creates a mesh network that work together to create an outrageously-fast, ultra-secure Surround WiFi network. Lastly, Luma’s app lets you easily see and control which devices, users and content are on your network. To buy your Luma, simply dead to getluma.com or amazon.com.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Harry Stebbings?

  This is the 20 Minute VC with your host, Harry Stebbings, and you can add me on Snapchat @H Stebbings with two Bs. I'd absolutely love to see you there. But to the show today, and my word, do we have a very different Founder's Friday for you today. It's probably one of my favourites, as it's probably the most real, most deep and thought provoking. So joining me for this very special episode is Jerry Colonna. Now Jerry is without a doubt, one of the most interesting guests I've had on the show. Jerry, or sometimes known as the CEO Whisperer, is a founder at Reboot, the coaching company that helps some of the world's greatest entrepreneurs and investors with the internal ups and downs in their life and support the growth they need to improve their performance. And prior to Reboot, Jerry was a partner at JP Morgan. And before that, Jerry was a VC, having launched Flatiron Partners in 1996 with his partner Fred Wilson.

• 0:45Harry Stebbings?

  Flatiron then became one of the most successful early-stage investment firms in New York, with investments in the likes of GeoCities, Gamesville and the New York Times Digital. Now, before we meet the main man that is Jerry, Jerry told me to be as real and true to myself as possible in life. So I thought I'd apply that to this sponsored stay with Luma. Now, for those that don't know, Luma is the world's first ever surround wifi system. And before I had Luma, man, the wifi in my house sucked. It's a tall townhouse and there are always blind spots. So I got Luma and it came with three routers. I placed one in the living room, one in the kitchen and one on the top floor. The setup was super simple. I think it took me less than 10 minutes to do all three routers and then download the app as well. Now I can see who is on my network, what they're doing on the network.

• 1:28Harry Stebbings?

  And also people can do a ton with the network itself. We've got people streaming movies in the living room, gaming in the games room, to me Skyping in my office. So to join me in this wifi heaven, simply head over to getluma.com, bestbuy.com, amazon.com, homedepot.com. Even head into a Best Buy store and buy it in person. It really is the best addition to my house in years. However, enough of me trying to do that unscripted. I'm now delighted to hand over to Jerry Colonna, founder at Reboot.

• 2:01Speaker 01

  You have now arrived at your destination.

• 2:04Harry Stebbings?

  Jerry, welcome to the 20 Minute VC. It's so great to finally have you on. I've heard so much from Brad and a huge thanks to Brad for the intro, but thank you so much for joining me, Stay Jerry.

• 2:13Speaker 02

  Well, thank you for having me, Harry. It's really a pleasure and an honor to be on the show.

• 2:17Harry Stebbings?

  Now, I'd love to start, Stay, by hearing a little bit about you and how you made your way first into venture and then came to be known as the CEO Whisperer. So what was the journey for you?

• 2:26Speaker 02

  Oh, I haven't told the story of becoming a VC in a while, so that's kind of fun. You have to imagine that my face is getting all watery as I flashback and remember way back. I'm in my early twenties and I'm a technology reporter for a magazine called Information Week. Didn't expect to be a technology reporter, expected to be a poet and writer. That was life. And I'd spent a couple of years as a reporter, then eventually a news editor, and then eventually editor of that magazine. And then I became the director of editorial technology, which put me directly in the path of trying to figure out what our non-print strategy was to be.

• 3:08Speaker 02

  And this is probably back when you were in grade school, so it was 1994.

• 3:12Harry Stebbings?

  Can I be honest, Jerry? I was born in 96.

• 3:16Speaker 02

  Oh, fuck. Fuck you.

• 3:21Harry Stebbings?

  But anyway, back to those times. I'll pretend to recall, okay?

• 3:25Speaker 02

  Okay, okay. So 94, I'm running our sort of strategy for figuring things out at this relatively large publishing company called CMP. And I hit upon this notion with the team that I was with. Mark Andries, who was still in grad school and he had just written the first iteration of a web browser. And we looked at that and said, holy shit, this is the future of media. And that fall, we launched all 18 of our magazines on the web. So we were only the third company to sell advertising on the web. So as I often say to people, if you don't like ads on the web, you can blame me.

• 4:05Speaker 02

  During that process, I had met a guy named Dave Wetherell, who had his own web browser. And in the same month, in the same period in November, we launched this business at Comdex in Vegas. And he sold his company BookLink.

• 4:21Speaker 02

  To America Online. He took that money and recruited me to be one of the first VCs in his new venture firm called CMG at Ventures. In January ninety five, we launched a small thirty, thirty-five million dollar fund. And it was the first fund to focus exclusively on what was then segmented out as the internet. And I stayed with them for about eighteen months. Eventually, in ninety six, the year you were born, Fred Wilson and I met through a mutual friend named Mark Pincus, best known, I guess, now for Zynga. And we went into business and formed Flatiron Partners. And that's how I became a VC.

• 5:04Harry Stebbings?

  So that's how you became a VC and led to a very successful career and venture. So what was then the transition into the CEO whisperer that you are universally known as today? At what point did you realize that was the transition you wanted? And why was that transition for you right?

• 5:22Speaker 02

  Well, as a lot of people have come to understand when I speak about this story, life doesn't move in straight lines up and to the right. Okay, life moves in squiggly lines with darts left and darts right. And one of the sort of squiggly line that took me in a different path was Flatiron had been very, very successful until it felt like nothing that was going on in the internet worked. And this was around two thousand, two thousand and one. Starting in around two thousand, I had begun to re-experience a deep and profound existential depression. The depression that came on in my mid to late thirties was different than the depression

• 6:06Speaker 02

  that I'd struggled with in my late, in my late teen years and early twenties. I had been very open about the fact that I had been suicidal in my teenage years, having been hospitalized at one point for an attempt. And so when it came back with a vengeance in my thirties, I needed to really pay attention to it. Without the clarity of mine that I can speak about it now. I went to Fred and I said, in the spring of two thousand and one, I said, I can't continue. I can't do this. And it was painful because Fred is a, he continues to be an incredible friend, love and admire deeply. But I couldn't be his partner. I couldn't, I couldn't do it. I somewhat mistakenly took a position at JP Morgan,

• 6:50Speaker 02

  thinking that that's all that I need to do is just sort of change the venue. But two, three months after starting that, I knew that that was wrong as well. And so I stayed out to the end of my contract, which was the end of two thousand and two, and then left really without a plan. And spent a number of years wandering existentially. The transition to becoming a coach began during that time when I was doing my own work. And basically saying, okay, I'm gonna just sit here and figure it out. Everything else I'm trying isn't working. Eventually, I had met a young man who was struggling himself. He was in his late twenties and

• 7:30Speaker 02

  he was an attorney and wanted to get into the startup business. And it was clear to me that he hated being a lawyer. I asked one of the questions that I've now become famous for, which was, you know, why did you choose the law? When obviously you hate it. And he started to cry. And that's when I realized I had a superpower. Actually getting people to connect into their deepest feelings. And from that moment, I realized that what I wanted to do was coach, or more importantly, I wanted to steep myself in this existential question of the ways in which what we do and who we are merge and come into conflict with each other.

• 8:09Harry Stebbings?

  In, in terms of then, because in the latest startup episode, you said with Alex Blumberg, until you make the unconscious conscious, it'll direct your life and you'll call it fate. Was that your moment then of making the unconscious conscious when you decided that was your time to use your superpower?

• 8:25Speaker 02

  To answer your question, the process of uncovering and unpacking what's truly going on for us, what I refer to as a radical self-inquiry, is never a one and done thing. It wasn't the one time in which it was an expression of that. And, and in that moment, it's a, it's a perfect example. It's like all of a sudden this little whisper in the back of your head comes up and says, you should be a coach. What the fuck? I don't wanna be a coach. No, no, you should be a coach. What? No. And the hair in your arm stands up and your your skin prickles and you start to say to your heart starts to beat really fast and you go, fuck. And that's an expression of

• 9:09Speaker 02

  when who you are really starts to emerge.

• 9:13Harry Stebbings?

  You you said there about who we are and what we do and their integration together. Is it not difficult then to have very segregated work and business lives? You might often hear it with kind of very intense bankers who, you know, work at Goldman Sachs and Morgan Stanley, and that is one very segmented part of their life, and it's completely different from their kind of very patriarchal, loving family side. Is it possible to have that segregation?

• 9:37Speaker 02

  Yeah, so what you're speaking to, the the language I would use is compartmentalization. Generally speaking, we all compartmentalize in order to get through the day. So you wake up and you're carrying some anxiety about, say, your significant other, and if you allow it, it can debilitate you and keep you from crossing the street. So you compartmentalize, you put it in a box and you leave it off to the side and you go about your day. And so it can be a very healthy part of the the way the ego operates. On the other hand, when we live a life where we're constantly segmenting off the inner reality of who we are and living with a mask where the outer does not match the inner over a prolonged

• 10:21Speaker 02

  period of time, that leads to a notion of disassociation. And disassociative states can be, again, can be helpful, right? If I'm experiencing something I don't want to experience, it can be really helpful. But over a long period of time, I believe it leads to depression. It's one of the things that leads to depression. And that voice, those voices that whisper, one voice says you should be a coach, the other voice says, you're a fucking impostor. You're a fucking liar. The hell is wrong with you? That voice starts to get louder and louder and louder. Because in essence, what we're doing is living out of integrity. So to go back to your example for a moment, the the issue between and

• 11:06Speaker 02

  and, you know, what we often hear is work-life balance. What I often suggest is work-life integration and the connecting point being.

• 11:16Speaker 02

  You. So for example, if you live your life as an empathetic, caring, feeling, vulnerable human being, and then you work into a work, walk into a work environment where those qualities not accepted, you are going to suffer. But if you walk into a work environment where those things are celebrated, as we experience with Gimlet Media, then what happens is the fullness of you gets to come forward. And instead of feeling depressed, you start to feel energized. Likewise, if that's not who you are, open, vulnerable, feeling in that state, and that's not who you are at home, and it's not who you are in the office, great, because then you're living a life in sync. Does that make sense?

• 11:54Harry Stebbings?

  It does, absolutely. I find it hard to correlate, though, to the industry that you worked in and I'm sure I will soon to work in, being VC in terms of vulnerability, and it's not often a trait celebrated in our industry with kind of hard term sheets pushing on valuations. How does that correlate into an environment which isn't what you are and what it could be?

• 12:17Speaker 02

  Right. So I don't know if you caught Fred Wilson's blog post last week in which he spoke about caring, and how after three decades in the venture business, one of the things he's learned is that caring is one of the most important qualities he can bring as an investor. Now, let's just pause. This is a guy who, with his partners, created, you know, Union Square Ventures 2004, possibly one of the best performing venture funds in history. And you're right, what we're talking about does not come from the playbook. We encounter this all the time at reboot, we encounter this all the time with the entrepreneurs

• 12:59Speaker 02

  with whom we work, that's our primary audience, because they'll come back to us and they'll say, Jerry, you know, leading the way you're talking about, that's not in the playbook. And here's my answer, fuck the goddamn playbook. Who the hell are you, right? You know, when we live our life according to the quote unquote playbook, whether we're a venture capitalist or a startup entrepreneur, just a regular working person, when we live our life... According to what other people expect us to be, we die a little bit every day. So what I often say is, you know, people think what I'm proposing is that they should walk around and cry all the time. Not at all. I just don't want you lying. I don't want you sitting there saying, you know, I'm caring when you don't give a shit.

• 13:44Speaker 02

  Then don't. And I don't want you pretending to be a bully when what you really are is scared. And by the way, I think that's the biggest problem in the venture business is that I think that many investors mimic the most aggressive behaviors as a way to cover their fundamental insecurity. And what are they so scared of? They're scared to lose money. Plain and simple. Because if they lose money, then it means that they're a shitty investor and then who are they?

• 14:13Harry Stebbings?

  So then how do you assess then, when you look at it and look at the venture ecosystem as a landscape today? How do you assess the current crop of VCs in terms of kind of integrating that kind of inner self and then the outer self?

• 14:26Speaker 02

  Well, I'm actually super excited. You know, Brad Feld is our partner in doing the VC version, the investor version of the bootcamps that we've been doing there for a few years. And we have our second coming up in January and we designed it to have 15 slots. And not only did we sell out, but we actually expanded this one in an experiment. And we're taking it up to, I think, 23 or 24 people. And I just want to pause and recognize that we've had 15, even though it's very well known that you come and you hang out with Jerry and Brad and the reboot team for a couple of days and you are gonna cry and you're gonna laugh and you're gonna be challenged, just the way Alex Blumberg was on that podcast.

• 15:08Speaker 02

  And you're gonna look in the mirror at your shit and that camp sold out. Because I think people are realizing that the current way of doing things isn't necessary, doesn't necessarily lead to better returns, which by the way is what the job is, and is painful. So what if there's a different way? And for me, I'm excited because it means like I want to support the entire entrepreneurial ecosystem. And so now with the VC Bootcamp, I'm excited because we get to go. After where the real power base is, the people who hold money.

• 15:39Harry Stebbings?

  In terms of kind of the entry point there, you said about kind of going a different way. What are the first steps to going a different way? Is it that self-realization of who you actually are before you before you know who you are? Do you know what I mean? Is it the looking?

• 15:52Speaker 02

  Yes.

• 15:52Harry Stebbings?

  Is that the first step?

• 15:53Speaker 02

  You know, what we describe it as is to skillfully and compassionately, and that compassionately is really important, strip away the masks so that there's no place for you to hide anymore. And who are we masking ourselves from? Ourself. And so the first step is to actually look in the mirror and say, what am I up to? Who am I? What are the what are the sort of ghostly images from my past that I'm carrying around as baggage that I then live with every single day and thrust upon the rest of the world?

• 16:23Harry Stebbings?

  I I do have I do have to ask, we we did speak to Brad earlier. You mentioned Brad, obviously, there with the bootcamp. And pre-interview, we asked him, what questions would you like to ask Jerry in the interview? And he wanted to ask you two questions in particular. So he wanted these are from Brad in a round we're calling Brad's Breakout. So what should VCs be spending more time on today, do you think?

• 16:45Speaker 02

  I think that VCs would benefit from spending more time looking at their own behavior, looking at the ways in which they are complicit in creating the conditions they say they don't want. So, for example, one of the big complaints that VCs get is or give me is that entrepreneurs don't trust them and so they don't tell them everything what's going on. So there's two ways that you can look at that. You can say, okay, what's wrong with the entrepreneur that I've backed? Or what am I doing to make it unsafe for that entrepreneur to tell me the truth? Right, because how do you sit in the seat of being an investor or a director without understanding better the conditions that's going on? So that's one thing. Another thing is to really look at your your own sources of anxiety,

• 17:30Speaker 02

  your sources of your own distress, and think about the ways in which you you're bringing that forward. Be conscious about it. Until you make the unconscious conscious, it will direct your life and you will call it fate. Why do I keep investing in the same kind of entrepreneur? Well, it's a great question. What's happening?

• 17:47Harry Stebbings?

  Absolutely. And and Brad also asked then, what advice would you give to VCs if it was one piece only?

• 17:53Speaker 02

  I'll quote the Bible, be not afraid.

• 17:55Harry Stebbings?

  Be not afraid in dealings with founders, in in investments, in relationship handling.

• 18:01Speaker 02

  Keep going, that whole list, all of it.

• 18:03Harry Stebbings?

  Uh but I'd love to dive into a quick fire round with you now. So I I say a short statement and then you give me your immediate thoughts, about sixty seconds per one. How does that sound?

• 18:13Speaker 02

  Sounds good. It sounds like a therapeutic free association. Very good.

• 18:17Harry Stebbings?

  This is it exactly. I'm actually just channeling the inner Jerry Colonna.

• 18:22Harry Stebbings?

  Um, Junior Jerry, that's that's not a good hashtag to go with. Um but anyway, let's go for favorite book and why?

• 18:30Speaker 02

  When Things Fall Apart by uh Pema Chodron uh transformed my life. Can I have an addendum?

• 18:36Harry Stebbings?

  Yep, absolutely.

• 18:37Speaker 02

  Uh Let Your Life Speak by Parker Palmer. I've read both of those books in the same week in two thousand and two and it altered the trajectory of my life for the rest of my life.

• 18:48Harry Stebbings?

  And then let's do the biggest takeaway from running the bootcamp. You've seen an incredible amount of people and incredible people. What's the biggest takeaway from seeing those top investors, as you said, laugh, cry and and change?

• 19:01Speaker 02

  That we all wanna be a member of a tribe, that we are all afraid that we're alone and that uh knowing that we're not alone creates uh a sense of relief.

• 19:12Harry Stebbings?

  And then not everyone has Jerry Colonna's call on. How should people find and select a mentor?

• 19:17Speaker 02

  I think the key is to really talk to people. See, it take if if you speak to people about who's been helpful to them, you will find additional people. And the key is to interview that person and really see if you have that emotional connection with them. If you can establish that rapport with that person, then the intellectual piece is easy. But the key is to really have that emotional rapport with the person.

• 19:41Harry Stebbings?

  Jerry, who coaches the coach? Who coaches you? How do how does that work when you need coaching?

• 19:46Speaker 02

  To be clear, I have worked with the same psychoanalyst for twenty four years and I often quote her in one form or another. Um and I have never stopped working with her. So she's my first coach. I've also had other coaches over the years, but the most important people um who work with me in that way are actually my partners here at the firm. One of the things we do is we work with each other. Um and so a lot of the values, because remember that whole inner and outer and making sure they map? Well, this is the way we actually run a company. And people who come to the bootcamp see us working with each other, um, right there, right there in person, right in the moment. So I have a few coaches.

• 20:29Harry Stebbings?

  And then your favourite blog or newsletter, what are your reading habits?

• 20:32Speaker 02

  Fred and Brad every day, mostly because it's a way to stay connected to my friends. There is a one newsletter that I, that I really enjoy, which is Alan de Batons, The School of Life.

• 20:43Harry Stebbings?

  And then let's finish today on party advice. Would you give to listeners of the show?

• 20:47Speaker 02

  On what topic?

• 20:49Harry Stebbings?

  I'm going to actually tailor this to me. When you have a mental attitude that all that matters is work and you dedicate your life solely to work. What advice do you have for someone like that in terms of beginning to integrate elements of yourself into work? And integrating that, as we said, kind of work-life balance.

• 21:07Speaker 02

  Harry, does it make you happy to do that?

• 21:10Harry Stebbings?

  It does if I know that it's going where I want it to go.

• 21:13Speaker 02

  And what if it doesn't go where you want it to go?

• 21:15Harry Stebbings?

  It's tough. It makes you question yourself, your ability and, um, what you're doing and the value of what you're doing. And, and when you're a solo founder, that loneliness and that isolation just gets compounded and, and feels so much, so much harder.

• 21:32Speaker 02

  And how's your life outside of work?

• 21:34Harry Stebbings?

  Limited. Work is my life.

• 21:36Speaker 02

  Mm-hmm. And how's that working for you?

• 21:39Harry Stebbings?

  It's great when everything works out, but, but when it doesn't, it makes you question all the sacrifices that, that I make. In order to work and makes you wonder whether it's all worth it, you know, whether the misalignment of life and work is worth it. And whether you should focus more on, on friends, on dating, on, on other aspects of life.

• 22:01Speaker 02

  So to go back to your question, so I asked a couple of coaching questions and I appreciate that because just giving blank advice doesn't feel right to me. Here, here's the thing I would encourage you to spend some time with. Every Now and then, there's gonna be a little whisper in your ear, Harry, that says, but what about, what about dating? What about friends? What about your body, running, or what about family? What about holidays? What about intellectual exploration? Every now and then, those whispers are gonna come up. And it's presumptuous of anyone to say the way you're balancing things is incorrect. What is correct is for you to keep tuning in to yourself, to those voices, and saying to yourself, how's this feeling right now?

• 22:46Speaker 02

  That's why the first question I asked you was about happiness, which, by the way, is always difficult to ask a Brit. Because their first response is, well, that actually doesn't come into the equation. I'm supposed to work. I'm sorry, bullshit. You know why the colonies broke away? Because of that. I'm teasing.

• 23:05Harry Stebbings?

  Well, on that note, Jerry, it's been such a pleasure to have you on the show today. I really have enjoyed the psychoanalysis at the end there. That's the first time that someone's turned the tables on me. So I really appreciate that. And it was just so fantastic to have you on the show today.

• 23:18Speaker 02

  You're welcome, Harry. Take care.

• 23:22Harry Stebbings?

  Now, I do want to say a huge thank you to Jerry for giving up his time today to come on the show and psychoanalyze me, as I said there. But really, it was such a pleasure meeting Jerry, and he is just the most incredible guy. So thank you so much to him. Thank you so much to Brad Feld for making the introduction today. I really do appreciate it. And also, if you love the show with Jerry today and do not want to leave the world of the 20 Minute VC, then you can add me on Snapchat, at H Stebbings with two Bs, or you can sign up for our newsletter on the 20minutavec.com. That way, you'll never have to miss an episode or an update from us. I'd absolutely love to see you there. But before we let you sail off into the sunset for the weekend, one thing that's guaranteed to put a smile on your face, as it did for me, is Luma. Do you want to stream movies in the family room, conduct video conferences in the office,

• 24:05Harry Stebbings?

  and game in the playroom all at the same time without the usual fight for bandwidth? And that's where Luma come in. Luma is the world's first ever surround Wi-Fi system that brings speed, security, and control to the home network. It really is finally Wi-Fi you'll love. And unlike traditional routers, Luma comes in a pack of two or- ...three sleep devices to place in different rooms around your home. The app then guides you through a simple setup and in just minutes Luma creates a mesh network that work together to create an outrageously fast ultra-secure surround wifi network. Lastly, Luma's app lets you easily see and control which devices, users and content are being used on your network. So if you want to join me in the joy of experiencing incredible wifi, then all you

• 24:45Harry Stebbings?

  have to do is head to getluma.com, amazon.com, home depot.com, bestbuy.com, or you can even buy them in best buy stores in the US. They really are absolutely incredible and as I said guaranteed to put a smile on your face this weekend. As always, I so appreciate all your support and I cannot wait to bring you Monday's episode.