Meet the GP’s – Ingrid Alongi
We are back with the second of our three part series introducing the General Partners of Stage Fund.
We sat down with Ingrid Alongi, who shared her perspective on the “technical co-founder myth,” guidance and advice for women in tech, and the technical evaluation and diligence process for Stage Fund on acquiring B2B SaaS tech platforms.
Austin: We’re back with our second episode of our Meet the GPs series, introducing the General Partners of Stage Fund. Stage Fund is a majority female-led private equity fund focused on acquiring controlling interest in companies undergoing a change in capital structure, strategy, operations, or growth. Today we’re with Ingrid Alongi. Ingrid co-founded Quick Left, a web engineering firm, which was acquired by Cognizant in 2016. Quick Left made the Inc 500 list of fastest growing companies several years in a row.
Ingrid was previously chair of the board and is currently on the board for the Turing School of Software & Design and has been a mentor for Techstars in Boulder, Colorado. Her personal belief is that successful technologies lie at the intersection of technology and human connection. Ingrid is a software engineer and loves working with people, making connections, motivating, collaborating, and solving problems. She’s a sought after public speaker having won numerous awards.
We’re also joined by Theron McCollough, Venture Partner of Stage. And myself, Austin Grisham, Director of Platform and host for the Meet the GP series. Ingrid, thanks so much for joining us.
Ingrid: Thank you. Happy to be here.
Austin: So, as I mentioned earlier, you are a founder yourself. Tell us a little bit about why you moved to start a fund versus jumping in to found another company or co-found another company.
Ingrid: Yeah, it’s interesting and not really what I expected to do, but when my company was acquired by Cognizant I had a very, I think, atypical experience as a founder.
Most of my founder friends, when they get acquired, they really struggled to figure out where they fit in, in the organization. They struggle with sort of having working in a larger company or having structures above them. And their team gets split apart and they get absorbed. It’s just really not fun and they can’t wait to get out and start another company.
I went into my acquisition with these things in mind wondering how I was going to feel, but I made a promise to myself that I was going to stay and really see what I could learn by being in a larger organization. And the other challenge that I was really excited about was can I keep my culture with growing my team in a larger team.
I think the biggest thing that made me curious about mergers and acquisitions and acquiring company is just how well our acquisition went. We were able to preserve our culture even as we grew to over a hundred people in the U S over a thousand people globally. We were able to create a really strong engineering team and build some really great products and it was really fun.
And of course, I did still struggle with, where do I fit and what should I be doing with my time? And there’s plenty of leaders here — there’s a lot of cooks in the kitchen. And so I was thinking that being acquired doesn’t have to be awful. And this was that first time where I was like, what if being acquired was amazing for everyone? And it wasn’t this awful story that founders just dealt with as part of the process.
And so that’s really where this interest started. I was very excited to be able to happen upon this opportunity with Stage to really see how I could practice that. Could being acquired be a growth opportunity? Could it be fun? Could it be chance to really learn from your past mistakes, changes in the market?
And so that’s really what led me down this path.
Theron: A quick question, Ingrid. Were you locked into the next company through the acquisition, then?
Ingrid: That is such a great question. I wasn’t specifically required to stay. I made that commitment to myself.
I think one of the mistakes I noticed with founders is when they get acquired, they experience a lot of different feelings and a lot of things and their immediate reaction is to leave and start something else. But they’re not maybe quite ready. They might still be experiencing burnout. They’re not rested, a bunch of things need to happen in a healthy way to get back out and start something new.
So, while no, I didn’t have anything specifically keeping me at Cognizant, I had made that commitment to myself to stay and see what I could really learn rather than just sort of reacting and doing what I already know how to do, which is start things.
Theron: How long did you stick around?
Ingrid: I stayed for four years. And it’s funny because the engineering team I helped build during that time, I would say, is the best team I’ve ever built. And I would have never thought that being in an enterprise environment would be the place where I built such a great team, but giving myself that chance to really push myself, to stay, solve my problems by staying, pushed myself to learn in different areas I wasn’t familiar with, I think, led to that success.
Theron: Great. So overall it was, it was a good move? You’re glad you did it? And had a chance to rebuild your momentum, to go on, to do something now new and totally different.
Ingrid: And really get a chance to reflect. I think some of that reflection really takes a lot of time. It’s kinda like when you go on vacation, you don’t really rest until a few days in and it’s the same with getting out of your startup. It takes some time to really be able to have the space to reflect and figure out what you’ve learned and what you need to work on still.
Theron: Nice. Thank you for expanding on that.
Austin: From what we covered in a bit of the introduction, what you’ve shared now, obviously you’ve worked with a number of founders, see where certain issues come up. With that in mind, can you share a bit about common pitfalls you see for early-stage founders and what are some helpful tips you would have for them?
Ingrid: one of the biggest things that I notice is lack of focus. I think, founders are creative and well-meaning, and there are so many different ways to solve problems, but I think that can really lead to people spreading themselves too thin or trying to do too much at once and ignoring the fact that companies that do have a lot of different offerings, maybe didn’t get there overnight.
I really think it’s important to focus early on. There’s a couple of reasons. One, I think just really understanding the direction you’re taking your product in a deep way is really important.
But also, when you’re focusing on one sort of small-ish thing, it gives you a chance to make mistakes in a way that’s a little bit more recoverable and it helps you set up those good habits.
So that when you do expand, if the market says you should or your customers, that you have gotten the groundwork laid out. And so that you’re able to scale, you’ve got systems and processes in place.
The pitfall of being unfocused and scaling too quickly is that you don’t necessarily have those good habits and so then you’re spread thin. You don’t have efficient process and you can’t really make things work. And it’s a lot of plates spinning. So it’s a little bit much.
Theron: I was just wondering, do you have methods, do you have processes, ascribe to being an agile, how you build things or can you talk a little bit about that?
Ingrid: That’s a really great point. I think frameworks are very, very helpful for keeping you focused.
When I was an engineer, I was an engineer before the days of agile and I think, when we started to transition into frameworks like agile or lean, there’s a lot of resistance because people didn’t want to be stuck with all these rules and how they organized their code and wrote code and reported their writings of code.
And what I realized after going through that emotional tour with my fellow engineers is that frameworks like agile keep you from really over-committing. I mean, we all, as engineers, we think that we can do all these things by next week and we all want to and we have the best intentions, but we’re just not good at estimating our time and figuring out how long stuff takes.
I see those frameworks as really good sort of guardrails to keep you focused, to keep you from just being your own worst enemy. I see that with lean, with product development and figuring out what is going to work well in the market. And then for Stage, we follow the EOS framework, which is a leadership framework, and that keeps us as a leadership team really focused on what we’re doing, and I think we’ve really been able to get where we are quickly because we’ve been able to stick to our investment thesis and to stay focused, even though there’s so many shiny objects out there.
Austin: Great. Thanks for sharing, Ingrid. That’s helpful to see and understand some of what you’ve used and what people have used in the past. When you’re looking at investment decisions for this new portfolio and what you’re building with Stage, how do you consider your approach in regard to engineering and making investment decisions with how engineering has been structured for companies that you’re looking at?
Ingrid: Yeah. This is really, I would say, the most fun part of my job. I’ve been an engineering leader as well as an individual contributor all of my career and I’ve built teams, I’ve built products, I’ve I had a consultancy. So I’ve been around different parts of the engineering life cycle for my entire career.
And so what I get to do now is look at how other companies are organized. And I’ve learned so much. I think when I was an individual contributor, having well-written code was very, very important to me and my team. But my mindset has really shifted and I think the notion of the perfect code base it just does not exist.
So when I’m looking at companies, I’m really looking at the risk that their technology is going to pose. Is it going to pose risk in terms of stability? Is there a bunch of code that I need to invest in to get out of? Is the team in a place where it’s going to be really difficult to collaborate and get things done? Is the team non-existent?
So these are all different things that I look at to put together to figure out, what is the investment going to be? How far along are they? If a company comes to us and doesn’t have tests or test coverage, that’s not great, but it’s not going to be a hard no on the investment side. It just means that that’s something that we have to keep in mind and be aware of.
Security is another thing. A lot of companies don’t build security in from the beginning and it’s something they have to add later. And some of that stuff is just a lot more expensive to add when you’re adding it later. So again, it’s just figuring out, where are we putting our investment dollars? Is it going to be more on the sales and marketing side or do we have to really put a lot of work into the technical side?
Theron: It’s really unique in what Stage does that you have a technical component being yourself as a GP to be able to look into the code. Does that add a lot of time to the diligence process?
If a company was to come in the door and you say, I think we’re interested, let’s, let’s go through this process together. Can you talk to that a little bit?
Ingrid: Yeah. It is really unique that we can do our own technical due diligence. And it’s not something that a lot of investment firms have.
I wouldn’t say it takes a lot of extra time because I’m not going in and reading code line by line because there’s just a lot of other things about the engineering team that give me a lot of clues as to what stage they’re at. Do they follow a process? Do they have the documentation?
You can’t avoid the product shifts and changes in direction that causes code to be written on top of other code that doesn’t quite work and you just patch it together. So I’m not going in and spending a lot of time with the actual code base, but I’m more understanding all of the different pieces of the team where they’re located and those things we can pretty much do simultaneously with the other diligence.
Theron: In a previous conversation, you talked a little bit about culture, an engineering team culture, and maybe the C suite or the founder. Can you expand on that a bit?
Ingrid: I’ve noticed that engineering teams that have a good culture and are very open are going to be really easy to work with. Whereas, if it’s really hard to get information, or if you’re in these meetings and the engineering team brings stuff up that is a surprise to the founder, it says to me that there hasn’t been a great culture and maybe they didn’t feel empowered to really be honest about what was going on in the code base.
And I’ve noticed through this process that we get a lot of engineering where information was kept where it needed to be to stay safe from an organizational perspective, but didn’t really benefit the company or the business or the product.
And so being able to shift that culture and allow the engineers to have a voice and to tell you what’s really going on, even though it’s not something you really want to hear. You really want a team that can be able to have that trust to do that. And so that’s something that is really important too when I’m looking at teams, if there’s that level of trust and people start to realize, they can tell me about all of the warts and the bad test coverage and it’s still gonna be okay. That is a team I’m excited to be able to work with.
Theron: And it also reflects a bit on back to that culture, but also the driver of that culture primarily being the CEO. Which of course as a whole, I mean, you’re doing diligence, you’re going to look at as well.
Ingrid: Yeah, absolutely. And I think that’s a lot of due diligence done at the C level and you’re getting that one side of the story. I get a little bit of a different side of the story and it does give us some extra insight into what we have and who are we’re really working with what we’re going to have to work on to move things forward.
Austin: Great. Thanks for sharing all that, Ingrid. I know you’ve touched a bit on engineering teams, a couple of things on tech stack, what people have worked on the different aspects of code and what you look at. Can you tell me what are some hard no’s when it comes to an engineering team and what’s been built by a previous team for a platform?
Ingrid: I think hard no’s tend to be, if the technology is not going to support the work that we need to do more immediately. So a lot of times when we start working with a company, they’re dealing with some issue, whether it’s abandonment on the funding side, usually it’s sales and marketing, they’re not quite getting something right.
We’re getting companies at a stage where every little thing is critical until we can get the marketing and sales engine running again. And so if I’ve got a technology stack that goes down all the time or if there’s only one person that knows how to press the right sequence of buttons so that the page is no longer white when people hit refresh, that is going to be really hard to work with. And the upfront investment to get to stability is going to be very expensive. So those are situations where, I don’t really care if a technology stack is old or outdated, as long as it doesn’t go down because that gives me time to understand what’s needed on the sales and marketing side to figure out what’s going on with customers and just gives me some more runway so that then I can decide, okay, now I need to invest in changing the platform to something else or adding more test coverage, and things like that.
Austin: When it comes to product leadership, tell me what’s important with having a product leader, when you guys are making investment decisions for a product under a brand. What’s important?
Ingrid: Product is extremely important because it’s really essential that you’ve got somebody paying attention to what’s going on in the market in terms of your C- level and all the different roles you think of, your CEO and your CTO is being very important. But I think the product owner, it’s become more acknowledged how important they are. Because if you’ve got somebody out doing fundraising, you really need someone who’s keeping an eye on what the market is doing.
Your product could be cool and amazing and all of these things, but if nobody cares about it, it’s really not worth building. And so a strong product owner who can keep track of trends and look at what needs to happen in that particular area of industry is extremely important. Our portfolio is pretty diverse, so we’ve got tech companies, we’ve got CPG, so we have to have people that are experts in their area to help guide us in that right direction.
Theron: Before we were also talking about user-centric design, do you feel that’s how all things should be done? Can you look at something and say, look, it’s not been done this way? Is it back to the engineering thing where you’re like, hey, we need to fix some things before we move forward? Is it just a blanket, this is what we look for — you have to have a product lead in there or we need to find someone to be that? What’s your process?
Ingrid: The notion of the entrepreneur was, I as an entrepreneur can predict what you need and you don’t even know what you need yet. I’m going to build it and then you’re going to be dazzled. I think that sort of led, I don’t know if you remember in the early 2000s that flip phones had cameras and there were all these features and they found that nobody really used them.
And I think that happens still today. When it’s really going to be difficult to predict what people might do and you’re going to have to get over the hurdle of changing the users’ habits, which is extremely hard. Putting that design first approach in, looking at the market, looking at the customer’s needs, figuring out if you’re actually solving a problem that users have, so that they’ll continue to use your product. It has become acknowledged and more important in the competitive landscape. With companies that we look at, they might have had somebody in that role, they may not anymore, we can put that into place. But in terms of the importance, whether it is there now when we get the company or it’s something that we add, it is extremely important for us to have that leadership in house.
Theron: I assume you’re looking at, are they using doing user interviews before they build the next feature? Things like stickiness, how are they getting their users to come back or the customers to come back, repeat customers? Do you have any practical resources or things that you abide by that you’re like, this is a go-to source or some knowledge that you can share with the audience.
Ingrid: I had a really great user research team at Cognizant that I got to get to know and got to really learn a little bit more about their field. I had done some of that interviewing data collection in graduate school as well and so I’ve been able to take some of those aspects into my work.
I like backing up assumptions with some data or checking your assumptions with, is it just me that thinks this is a cool feature or does the rest of the world like it too? And I think sometimes, after working with this team, I’ve learned that I might not use technology the same way as other people. I might be an outlier. So I never assume that my way of using things is going to work in the market. And I think proceeding with that assumption is probably pretty smart.
And then I like to keep up on Tech Brew and Retail Brew. Some of these online daily emails that give you a little snippet of what’s going on and trends.
And I also like to keep up on the Wall Street Journal and New York Times and Washington Post to just see what the big journalists are writing about in terms of technology in the market. Just staying plugged in with reliable sources is also something I try to do to gauge what people outside of my home office are doing.
Theron: Ever so important now, since we’re so much behind our desks. Alright, thank you for that.
Ingrid: Yeah, exactly.
Austin: To touch a bit on the portfolio side of Stage and y’all’s evaluation process in terms of co-founders and founders and the technical side of people’s backgrounds. Is it required to have a CTO or technical co-founder or founder? Talk a little bit about the myth of the technical co-founder and how you approach diligence and looking at companies to add to the portfolio.
Ingrid: Having a CTO or a technical co-founder, I really think about more in terms of the stage that the company is at, rather than it being an essential thing to have from day one. I do have a lot of experience with early-stage startups because of my work with Quick Left. We worked with a lot of early stage companies, as well as, as being a Techstars mentor.
And this is a struggle that a lot of these companies have, they feel — especially a non-technical person feels — that pressure, that in order to be a good tech company, they need to have a really strong technical founder. And I’ve seen a lot of companies bring in a technical person as a co-founder, give them a lot of the equity in the company, and then realize that the person isn’t really cut out to be a founder, and then they’re stuck.
And this can cause some problems later on when you’re raising money and investors are wondering who this person is and why they have so much of the company. I really try to get people thinking sooner than later about what is founder material and then what do you need on the technical side?
There’s so many options now to outsource development, near shore, off shore, that you really don’t need a software engineer to be your co-founder, depending on a lot of other things as well. I think what you really need though, is somebody who can really focus on making sure the product is going in the right direction.
And if you’re fundraising, you got to have that person focused a hundred percent on that. That’s a role in and of itself. And then you’ve got the product person who’s really making sure that the product keeps moving while fundraising is happening. And none of those two that I just described are necessarily engineers or technical people.
I think it’s more about, can they manage a technical team, whether they hire a couple of contractors again or they’re outsourcing? There’s certainly products that are very technology focused where you would probably want some expertise. I would say some AI products or security products and things like that.
But I think that it’s really important for early-stage founders to just be careful about who they consider a co-founder and what qualities that person needs to have, and not just bring someone in because they know how to write code.
Austin: It sounds very practical to apply to that thought process.
Theron: Really helpful. Cause it gets confusing. And being a founder myself building technology, I understand, in one sense, you’re going to rebuild the code. You’re going to have to maybe rip and repair or, as you were saying, look back and say, hey, we need to fix them. And then at some stage it’s good to have strong technical oversight. But it’s so easy to build software, that getting the product in the market and having that product person really focused on how do we go to market? How do we acquire new users? How do we delight them to keep on growing and growing and moving forward is paramount in addition to the CEO so they can continue fundraising. Which I think is a little different aspect than a lot of people talk about, so I really appreciate that.
Ingrid: I just want to expand on that where it just depends on what stage you’re at. And if so, a company that’s further along, I would expect them to have technical leadership. You know, once they have that traction from users, they’ve started to get some funding that’s exactly what they should invest in: technical leadership that can help scale the product, make sure that the users are being served properly and things like that.
It’s almost more responsible to bring a technical person in at the right time. And having the more responsible plan when you’re going out fundraising. It used to be you were dinged if you didn’t have a technical co-founder. I think people realize now that you have to actually have a more smart way of organizing your company and bringing the right people in at the right time and understanding when that is, to me as a little more impressive than someone who’s like, I’ve got this buddy who can write code and has three other jobs, but I’m still gonna give him half of my company. That’s not going to work.
Theron: Thanks for expanding on that.
Austin: Shifting back a bit more into how you evaluate companies who you’re looking at from an engineering perspective. Can you tell us a bit about finding an engineer and knowing if an engineer is a good fit as a co-founder in what you’re evaluating?
Ingrid: Yeah, I think that a good co-founding engineer is one I think that has a lot of flexibility. There’s nothing worse than throwing away code that you’ve spent a lot of time on and that you are you’re very proud of. And that’s sort of just inevitable, the product direction is going to change, there’s going to be a lot of reasons that it’s just going to have to be reworked.
So if you’re going to be a founder as an engineer, you have to figure out how to make peace with that. You’ve worked hard on something that’s just so detailed and you’ve planned through, it’s just not always going to see the light of day or it’s going to shift and change over time.
So that’s one aspect of what I think is needed for a technical engineering type to be a good founder. But I think also someone who’s really got an eye for the market. I think there has been, and I think this is becoming less so, but this divide between what’s happening in the code and the engineering side and the engineering culture versus the business and the market side of things.
Really being able to make connections that are meaningful for the customer in what your technology does is another really important aspect of a founding engineer because you’re not just taking instructions and writing code, you’re really needing to have empathy and understand the customer even though you might not use technology at all like most people. And understanding and having the humility to say, okay, my way of doing things isn’t really great for the market. It’s cool and fun, but this is not going to sell those are some really important ingredients to take a product forward.
Austin: To shift a little bit into a new topic. You are a female founder. You are a part of a female-led fund now and understanding a bit of the importance of diversity and women in science and engineering. In 2017, the National Science Foundation reported that women represented 29% of science and engineering jobs. What is some practical advice that you can offer young women on their journey to entrepreneurship and technology?
Ingrid: Well, it used to be worse so we’re making some progress. I think that my biggest revelation on that is that it’s never too late.
And now there’s a lot of ways to get into technical careers that don’t require that you get a degree in biology or computer science. I took computer science classes in graduate school while I was getting my master’s degree in women’s studies.
I realized that I was sort of wired that way and really loved writing code. And it was so hard. And I remember taking some classes and feeling like, why did I think I could do this? Maybe I made a mistake, but I’m a non quitter so I stuck with it and made it through and started my career as a web developer.
And I see that now that I’m on the board of Turing, I’ve been chair of the board of Turing, I really appreciate the career changer. Those people that realize that they have a knack for engineering or writing code and now there’s all these great outlets where you can go back and get that training and change careers.
National Center for Women in Technology (NCWIT) is another organization that’s really active in the STEM community for girls and women of all ages and there’s a lot of ways to get plugged in there. And then there’s a lot of opportunities, even on the marketing side in a technical company, you’re going to be involved in technology and get to learn it. And so I think that there’s just a bunch of opportunities to get involved and you can start at any time.
You haven’t missed the boat if you didn’t major in science in college.
Austin: A female leader yourself and looking at the future stages of what you just addressed from younger women and women of different ages entering into these tech sectors and having more representation. What advice or mentorship do you offer for a female tech leaders specifically? What would you share with them?
Ingrid: Yeah, I think what really helped me was to stay connected to other women founders. So, being a founder is pretty lonely. I think there’s a lot of excitement and fun that goes with it, especially in the beginning. But I think as you’re getting your company further along and growing it and trying to take it to the next level, the problems and the challenges just become more difficult.
And it’s just finding a way to sort of stay connected to other women that you can trust that you can talk with about these things. You can’t really talk to your coworkers about anything hard. It’s a lonely place. So, having a quarterly dinner or a monthly zoom call. I mean, that’s really how I connected with my partner Krista over the years.
We were two of the very few women founders in the Denver-Boulder area, tech founders, and we would just have dinner together. And we had so much trust and we could talk through some of these difficult things that we were going through with our companies. And those connections are just essential for making it a little less hard. You’re not alone.
Theron: Would you say the same thing about the path to GP, being a GP and getting onto the venture and investing side?
Is that similar or you almost fell into this maybe? And I know Krista obviously, you started out as both entrepreneurs and built a friendship, and now you’re both co-GPs in this fund. Is that a path that can be taken? Can you talk a little bit about that?
Ingrid: Yeah, I mean, I think the other feature of me being a sole female in a room full of men is I happen to be very interested in things that tend to not have other women in those. So a little bit of this is doing what I love. And then I find myself in these environments where I’m like the only woman in the room.
But I’m very comfortable. Even growing up, I was a competitive cyclist, I was on the US team in high school, and I’m very used to competitive environments, but very team-oriented and collaborative environments.
I find myself in another space as an investor that there’s not a lot of other women doing this and, and yes, staying connected to these other women who are doing similar things is important to us and Krista and I both spend time having lunch with other women investors and collaborating with them and it really does help to stay connected.
Austin: With Stage and your background, Krista’s background after we spoke with her, obviously we’ll be speaking to Dan soon, there are different pieces that you each bring in terms of evaluation and diligence prior to an acquisition –share with us a bit of the criteria that you as a group are looking at when you’re considering an acquisition for Stage.
Ingrid: We’re not an early-stage investor. So while we we’re entrepreneurs and we’ve worked with a lot of early-stage companies when we mentored, we really focus on companies that have already proven their product-market fit, they’ve had at least $2 million in revenue at some point in time. They may have gone up and come back down. We want them to have raised around $5 million previously and they are good businesses that find themselves in a position where they aren’t getting the attention that they need from their investors.
B2B SaaS, we’re looking at these great businesses that they’ve invested a bunch of money into the technology stack and they need to get a little further in some of their customer acquisitions to break even.
Those are great opportunities for us because the investors might not be interested because their growth isn’t on a trajectory that they want, but there are great businesses that we see a lot of potential in. So that’s really what we’re looking for and established product-market fit that we can take it to the next level.
Austin: Thanks for that. Thanks for taking the time today to join us, go through these questions and connect, really appreciate you having joined us on this interview.
Ingrid: Thank you for having me.
Austin: And just to let everyone know, to understand a bit more about how Stage invests you can go to stagefund.com. As we tell all founders, there’s no judgment and no criticism in our approach. You can also connect with Ingrid Alongi on LinkedIn. Thanks so much.