A Conversation with Venture Capitalist Shuo Chen
As an undergraduate student at UC Berkeley, Shuo Chen triple majored in Business Administration, Economics, and Rhetoric, minored in Public Policy, and earned the SCET Certificate in Entrepreneurship & Technology. Today, she is a General Partner at IOVC, investing in early-stage enterprise and SaaS startups. Additionally, she is an instructor at UC Berkeley and Stanford University, teaching topics around entrepreneurship and innovation.
Exploring Entrepreneurship at UC Berkeley
At UC Berkeley, Chen took advantage of every opportunity to learn. Originally, she was uncertain about what she wanted to study. She chose UC Berkeley for its unique flexibility in selecting a major, and she especially appreciated how the breadth requirements encouraged students to broaden their horizons. Chen explored a plethora of academic disciplines, and she ultimately decided to major in three entirely different disciplines: Business Administration, Economics, and Rhetoric. Chen also quickly discovered her passion for entrepreneurship and immersed herself in the startup ecosystem on campus.
During her undergraduate years, Chen founded her first startup, Cashify. She realized she did not know much about managing her money, especially as an international student from Canada. To address this issue, she developed a curriculum around personal finance and money management, which later became the foundation of her startup. To develop the curriculum, Chen partnered with Haas faculty and worked to establish a DeCal course for undergraduate students, the very first personal finance course offered at Haas. The course was immediately a hit—though they did not market the class publicly, they received over 100 eager students on the first day of class. The overwhelming demand prompted Chen to make this content more readily available to different schools and companies. As a result of high demand, she founded Cashify, a social enterprise at the intersection of Fintech and EdTech, designed to provide financial literacy and money management training content and software for higher education and financial institutions. Throughout her undergraduate years, the business steadily evolved into a larger initiative that brought together a large group of contributors. Eventually, the entire team was hired in finance and Chen began her career in investment banking.
From Entrepreneur to Investor
After graduating from UC Berkeley in three years, Chen worked in investment banking at Goldman Sachs before transitioning to a career in venture capital. A lifelong learner, Chen appreciated how being a venture investor seamlessly integrated continuous learning into her career.
“It’s an incredibly humbling process. My job is to work with some of the smartest people in the world trying to solve some of the world’s biggest problems, and my job is to learn from them and to identify those who are most likely to make that more positive future come true and to help those founders make that happen.”
Chen, who has had experience on both sides of the table as an entrepreneur and as an investor, notes that these roles differ significantly in skillset and scope. As an investor, Chen must support a range of founders and must adeptly identify patterns across multiple startups.
“Entrepreneurs are ultimately the ones who are building day to day. Our role as investors is to support them in the way they want to be supported. But because we’re not so involved in the day-to-day of operating one single company solving one specific problem, it sometimes is easier to pick up patterns for how you can do something more effectively. You can learn from one and apply to another company facing a similar challenge, even if they’re building a completely different business model.”
Equally important, Chen emphasized that maintaining aligned interests between founders and investors is essential for fostering a synergistic relationship, the cornerstone of a successful partnership.
“I used to think that investors were on the other side of the table because I was a founder myself, so I always thought that investors were not necessarily preparing for my best interest because they were on the other side of the table. And it took a lot of learning for me to understand why. There are incentives that are driving different behavior between founders and investors, for sure, but the best investors are those that are aligned with the interest of the founder from the get-go.”
When speaking with entrepreneurs, Chen notes that two key factors: the first is metrics around the business itself, such as efficiency around capital, tech, time, and growth, and the second is that the entrepreneur has a deep passion for the problem they are trying to solve.
Focusing on Fractional Founders
Additionally, Chen explained a cultural unfavorability for fractional founders, individuals who take on the responsibility of a founder but on a part-time basis while maintaining a full-time role. She noted that, “I felt like that was quite taboo. People didn’t like the fact that you were doing multiple things.” However, Chen found herself continuously pursuing part-time projects to address the challenges she faced in her full-time roles as a student and later as an investment banker at Goldman Sachs.
“I always studied multiple things, and I had a breadth of interest. I was focused on trying to solve problems, but I felt like I was better if I were able to try to tackle the same problem from different angles at the same time.”
“There is a fine line to be drawn—if you’re doing multiple things that are completely unrelated, that indicates a lack of focus. But if you’re doing multiple things that contribute towards the goal, it can be a good opportunity for a founder to change the way that things are done because they can bring in different perspectives.”
Chen shared that her work is inspired by her struggles as a founder, stating that as an investor, she aims to help alleviate some of those challenges for others. For example, Chen faced pressure to sell her company to large companies and institutions, and she experienced a lack of available resources that would have deepened her understanding of enterprise business models and made the process more accessible, as engaging some of the largest companies in the world is quite formidable as a young entrepreneur.
Now as an investor, she is focused on supporting fractional founders, a group underappreciated in the startup ecosystem. She established a fund to support founders who had experienced the problem firsthand, tested solutions, and gained traction before deciding to turn their part-time projects into full-time ventures. The perception that founders should dedicate all of their time to building their startups from inception is a hallmark of Silicon Valley startup culture; funders who indicate that they still have full-time roles are often screened out early by investors when applying to startup accelerator programs.
“I think that that’s a missed opportunity. I think there are a lot of really smart, fractional founders who are time-efficient and can build amazing products in the early days part-time. After they test all their hypotheses, they can build it full-time.”
Reflections on the Journey
Chen views her career as an ongoing journey of learning rather than a linear path with a clear destination. In reflecting on her journey, she has found fulfillment in being able to contribute to a founder’s success through collaboration.
“I’m happy to be the entrepreneur behind the entrepreneur and help founders be successful in their own right. I think the proudest I’ve ever been is witnessing founders that we’ve invested in achieving successful outcomes. An outcome isn’t just defined by exit, as in an IPO or an acquisition—it’s really any outcome that they would be incredibly proud of for themselves.”
As she continues on her career journey, Chen highlights the importance of leaving a positive mark on the world, and she has found her calling in increasing efficiency in the workplace.
“How do you leave the world in a better place than what I started? This is kind of cliche, but I think it’s also true. And everyone defines better in a slightly different way. What I consider as ‘better’ is defined as more efficient in our work lives. I would love to leave the world a better place by helping people have more enjoyable workflows during those hours when they’re working. How can I help people better access to software, better access to tools that allow them to automate the more boring aspects of their work, and increase the time spent engaging in more strategic and personal relationship-building.”