Podcast: Understanding e-commerce and fintech with QED's Victoria Zuo

In this episode of Fintech Thought Leaders, QED's Head of Early Stage Investments Bill Cilluffo speaks with colleague and QED Principal Victoria Zuo.

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Show notes

Bios

Bill Cilluffo joined QED as a Special Advisor in the fall of 2014 and became a Partner in 2015. He is currently Head of Early Stage Investments after six years as Head of International, leading QED’s Investment teams in Latin America, Europe and Asia.

Prior to joining QED, Bill spent nearly 20 years at Capital One, spanning several roles and leading several businesses. He spent the first 6 years of his career leading Marketing, product development and credit policy for Capital One’s subprime credit card business; ultimately having overall P&L responsibility, and growing the business to become the most significant player in the market. He moved on to spend 2 years in various new business development roles, spanning the telecom, medical finance and small business finance industries. Bill spent 3 years as Deputy Chief Credit Officer for the bank, playing nearly every role there was to play in the central credit function, after helping build the department from scratch in 2002.

Bill then pivoted his career to general management, leading Capital One’s Canadian, and ultimately International businesses, over the course of 6 years. Profitability of the business grew significantly under Bill’s leadership, through new product and channel introductions, acquisitions, and significant cost take out. During Bill’s last 3 years at Capital One, he led its Co-Brand and Private Label credit card business, building the business nearly from scratch to one of the top few players in the US market, through a series of acquisitions, most notably including leading the acquisition and post-merger integration of HSBC’s US credit card business, which closed in May 2012.

Bill graduated with a BA in economics from the University of Michigan, and competed the SEP program at Stanford GSB.

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Victoria Zuo joined QED in May 2022 as a principal based in San Francisco where she has a focus on investments in early stage fintech and commerce businesses.

Prior to joining QED, Victoria helped lead fintech investing at Gradient Ventures, Google’s early stage venture fund, where she worked with founders building the next generation of fintech and commerce tech in categories like insurance, e-commerce, application software transaction processing and core fintech infrastructure. Victoria started her career in tech M&A at Qatalyst Partners, advising founders in their sell-side processes on more than $20 billion in M&A transactions.

Victoria received her B.A. and M.S. in economics and engineering at Stanford University and is a proud supporter of the Cardinal football team even through the worst times.

Prior to college, Victoria was born and raised in Nanjing, China, and continues to draw inspiration from the boom in commerce innovation in Asia.

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Full transcript

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Bill Cilluffo:

You're listening to the Fintech Thought Leaders podcast from QED Investors, your deep dive into the world of venture capital and financial services with today's digital disruptors. QED is a global venture capital firm focused on investing in fintech companies all the way from pre-seed to IPO. Fintech Thought Leaders brings together the most talented entrepreneurs tackling today's biggest problems. If you're looking to learn more about what motivates our founders and team members to succeed, you're in the right place.

Hello and welcome to the Fintech Thought Leaders podcast. I'm Bill Cilluffo, the head of early stage investments at QED Investors. Today on the podcast, I'm thrilled to be joined by colleague and QED principal, Victoria Zuo. Victoria, welcome to the podcast.

Victoria Zuo:

Hi, Bill. Great to be on the podcast. It was you.

Bill Cilluffo:

Great to have you. Look, there's so much that I'm excited to discuss today about what you're seeing in fintech and what's happening in the markets. But before we dive in, can you just give a quick elevator pitch on your background and how you came to QED?

Victoria Zuo:

Sounds great. So I was born and raised in a city called Nanjing, China and came to the US for college and studied economics and engineering at Stanford, spent a few years working in M&A investment banking at a firm called Catalyst Partners and primarily actually selling a lot of Fintech and commerce businesses to large tech buyers. And afterwards, spent about five years primarily leading fintech at Google's early stage venture fund called Gradient Ventures, first formed as the AI-focused venture fund of Alphabet. And joined QED and the team a little over a year ago, and I'm based in San Francisco.

Bill Cilluffo:

It's amazing how time flies. I remember when you came to interview with all of us in Santa Monica.

Victoria Zuo:

I know.

Bill Cilluffo:

That was a lot of fun.

Victoria Zuo:

That's a year and a half ago. I still remember flying on, and it was a nice house.

Bill Cilluffo:

It sure was. That's for sure. So look, I'd love to dive into a little bit of your pre-QED background, but let's go all the way back to the beginning at some of your time in Nanjing. Very large city. There's so many large cities in China that it's probably not the first one off people's tongue, but still at 8 million people, would be one of the largest cities in the US. You were growing up during just a hyper-growth period of consumer internet, e-commerce. Obviously that's something that you've spent a lot of time diving into your whole professional career. I mean, how did that shape you? Did that plant some of the seeds that became a big focus years later?

Victoria Zuo:

It was a very interesting time to grow up in China, right? Like Nanjing is a city of probably maybe 10 million people by now. It's definitely not one of the largest, but it's a very historical and old city. And I just remember growing up in China in the late 90s and early 2000s, the shift in how people are using technology has become quite significant. I still remember getting my first phone when I was in probably middle school quite a bit later than American kids these days, but connecting to the internet, having smart apps, having payments enabled on the phone and this kind of evolution happened probably in a span of five to six years within China. And it's just very rapid compared to the more gradual shift that we've seen in the US, and it's definitely fueled a lot of my interest in the mobile and commerce and payments industry and I still draw a lot of inspiration from seeing that shift.

Bill Cilluffo:

So coming over to the US, you probably thought we were completely backwards in terms of how all our payments worked is coming from China, right?

Victoria Zuo:

I know. I still remember having my first credit card at the on-campus, Wells Fargo at Sanford. I had a deposit account with Wells Fargo, everyone was telling me that I should start building my US credit history and I showed up, and they gave me $120 credit limit and I was like, "I have way more money in the account." The $120. So it was definitely a shocker when I got my first credit card.

Bill Cilluffo:

Yeah, it's incredible how backwards the US system of payments are relative to elsewhere in the world. I know when Nubank back in the day took their first field trip to China led by investor Tencent, half the people they talked to, they're like, "What are you talking about? A credit card? What is that? Why would you ever use one of those things?"

Victoria Zuo:

I know.

Bill Cilluffo:

There's a few more generations when you go to other places.

Victoria Zuo:

I know, exactly, exactly. I actually haven't been back to China since 2017 and I've been told that my parents don't bring anything by their phone out. They unlock their doors using their fingerprints, they pay for everything. And I'm talking about even local street vendors using their phones and that's just basically unimaginable here in the US.

Bill Cilluffo:

Someday maybe, but we may have a long way till we get there.

Victoria Zuo:

That is true.

Bill Cilluffo:

So jumping forward a little bit, you came over to go to Stanford. I know you've spent a good amount of time there and then never left Northern California. What led you to Stanford? Not that it's a rare story for people to want to go to Stanford, it's an amazing place. But how did you decide you wanted to go there and come over to the US for school?

Victoria Zuo:

So I went to this foreign language school. It's not an international high school, but a lot of the kids from my high school do end up coming to the US or UK or Australia for college. So that was a given since I was pretty young. The primary decisioning point was actually going to the East Coast versus to Stanford. Growing up in China, I've always pictured my life in the US centering around New York and maybe I wanted to go work at the Goldman Sachs and go work in private equity and go to business school and go back and be like a PE person.

And I always pictured going down that path. So most of my options were actually more East Coast, financial services-focused schools. And I had actually never visited Stanford before landing on campus for my freshman orientation. That said, during the 2010s, it was my time to decide to go to college. China was just going through a rapid technological shift. Alibaba was planning on going public, Tencent was taking over everyone's phones in terms of install and just seemed like such an exciting wave of change and shift, and I knew that Silicon Valley was at the heart of everything, so I couldn't pass up the opportunity to be in the center of everything from a geographical standpoint.

Bill Cilluffo:

Yeah. Were you ever tempted after school to move to New York to try that out or you just got hooked on the Bay Area and never going to leave?

Victoria Zuo:

Many, many times. One of my first internships was actually in New York at JP Morgan in diversified industrials investment banking, which is a very different world. I was working with companies like Dom and Sento, and it was just almost immediately clear to me that wasn't my path to take after my internship. And after that, I made an immediate pivot back to tech. And I still miss my New York summer days, but have never looked back since then.

Bill Cilluffo:

Although this summer with the Canadian wildfires, I don't know if the summer days are quite as good as they were back then, but it's amazing.

Victoria Zuo:

Well, San Francisco is not unfamiliar with wildfires.

Bill Cilluffo:

That's true. Good point, good point.

Victoria Zuo:

Yeah.

Bill Cilluffo:

So clearly, you've had an investment banking type bug ever since a young age. You pursued it in your internship. Your first job out of school was investment banking. I guess what drew you to investment banking? And it sounds like there was a merger of tech and investment banking when you decided to do your first gig. What led to that as a route to go down? I

Victoria Zuo:

I still remember when I was in college, there were a few different path within in finance. I was considering across sales and trading, like direct investing and obviously, capital markets and mergers and acquisitions. And I was just very fascinated by how major acquisitions have really impacted the identities of tech companies. For example, one of the most successful acquisitions in the history of tech M and A is probably Google's acquisition of YouTube and how it's really fundamentally changed how people use ads and how Google has grown as a company. And I just thought it would be very exciting to be part of that identity-defining process of companies and joined a firm that was in pretty unique position in that point in history to be part of the industry.

Bill Cilluffo:

Yeah, that makes sense. I mean not that investment banking and venture are unrelated, but clearly still a pretty different spot. What made you decide to make the jump to VC and join Gradient?

Victoria Zuo:

I thought, M and A, and mergers and acquisitions is a very definitive point in time in a company's journey. You spend three to four months going through an acquisition or a purchase and you're done. You start the relationship with the company and you end it in a very short time period. I just felt like I was learning so much from the funders and the operators of the company that I wanted to build a more longer collaboration experience and journey with the companies. And I thought Venture was the perfect place to build that kind of relationships. And also, it was not every other day that Google's starting a new firm. So when Gradient was getting funded by Google, I jumped on that opportunity.

Bill Cilluffo:

That's exciting. So clearly, you've not looked back since and have built a really nice career so far in venture. I mean now that you're in it, what are the things that keep you in it and what are the things that excite you most within the venture world?

Victoria Zuo:

I think it's definitely working with the funders, rolling up the sleeves and working very closely with the companies that we're working with. I often joke that there's got to be some kind of insanity of genius with every funder that we're working with because otherwise, you wouldn't put your body through that process. So, being able to experience those spurts of genius and pure optimism when people are working with us, it is just such a privilege and being exposed to a lot of these sharpest and brightest of our industry is definitely one of my favorite parts of working in the industry.

Bill Cilluffo:

Yeah, I can certainly relate. I mean it's stunning just the broad array of people you meet, the broad array of backgrounds, the stories that they all have. I mean clearly, the tech industry is certainly one of Silicon Valley's big assets, but really the world's big assets and attracting incredible people to it around the world and that's certainly one of the things I most resonate with as well.

Victoria Zuo:

Yeah.

Bill Cilluffo:

But as we take the conversation into QED, I mean one of the things that you've been able to really bring to QED among many others is just a deep knowledge and understanding of the e-commerce space and how does Fintech intersect with e-commerce and where is this going in the future. So winding way back, I understand that as you were growing up, you really started to think about e-commerce involving your parents buying fish, which is not what I would've expected. So we need to hear a little bit of this story as we jump into e-commerce.

Victoria Zuo:

It is my parents buying fish, but it's actually me getting the fish. So as a lot of the Chinese immigrants might know, there are very robust and deep groups of Chinese parents, WeChat groups, with children in the US. And there's this group of Chinese moms that have kids in the Bay Area, and this group is enormous. It has probably 800 people in the same WeChat group, and some of them decided to form this offshoot for fresh seafood buying within WeChat. And my mom joined part of the WeChat group, and [inaudible 00:12:06] and this is a group of 400 people that I've never met in my life coming together to buy freshly shipped seafood and fish from the Bay Area.

And there's this guy who drives around in a little van, you have real time GPS location for this van. There's no website. They just send out a Stripe link every Saturday and for whatever that you need to order that given Saturday, you message this random lady your entire order and she tallies up the order information and you just magically have fresh seafood on Saturdays. And I was doing a mental math of GMB going through this group. There is 400 people in it every single weekend. They probably get at least $8,000 to $10,000 of orders just by having no website and having nothing at all.

Bill Cilluffo:

And these are parents from China ordering their kids in San Francisco fish from a delivery person with no website?

Victoria Zuo:

Yes, exactly. That's a 100%. I don't know if it's up to a health code or I don't even know if these people are paying taxes. I don't want to out them, but I guess every parent worries about their kids not having enough to eat. Yeah.

Bill Cilluffo:

That's wild. So you started to mentally try to figure out what was the GMV, how big was this business and how did you jump from there to this passion for e-commerce?

Victoria Zuo:

I think part of the inspiration coming out of that experience is how integrated commerce can grow as a form of purchasing products and goods. People get the intent to purchase from many different channels, communities with Chinese moms, random video ads, software that they're already using. So that's actually part of the reason why I have been so excited about embedding commerce and purchases and payments in all forms of products and software. And I definitely think fintech becomes a very integrated part of enabling those kind of experiences.

Bill Cilluffo:

Makes sense, makes sense. I mean this is a fascinating thing to watch around the world. You see very few industries that have a moment, like the COVID moment, that really wind up accelerating in ways that are unpredicted even though the growth trajectory was amazing before that and will continue long after that. Where do you see this headed right now? What are some of the trends that you see in the e-commerce world that are really innovating, especially, I guess, in the US, which is a big part of your focus and where this thing's going right now?

Victoria Zuo:

So e-commerce penetration in the US grew pretty rapidly during COVID. As you know, we were at about 11% in penetration in 2019. We're now at about 16%. This is probably some of the fastest growth in consumer behavior for the US and it has cost a lot of fundamental shift within the industry. CAC has become very high because of a huge inflow of capital. Global and cross-border purchasing became more and more of the norm. A lot of the purchasing information in the B2B sense have become more digitized from pen and paper.

So I think there are many different forces impacting our world right now. So reducing CAC as part of a huge inflow of capital becomes a very important layer that fintech is playing a critical role in enabling. In terms of global shipping, there's a lot of cross-border payments, global taxation and global treasury management opportunities that we're super excited about. And from the B2B sense, we are seeing a lot of movement in trade finance in B2B, working capital financing and in trade credit automations. So in the world that become, COVID has been a very critical force pushing forward a lot of the advancement and automation that just wasn't happening despite technology advancements a few years ago.

Bill Cilluffo:

That makes sense. And it sounds like, I mean you've referenced several things that have to do with international purchases and I assume this is both American consumers buying things from international websites, as well as US merchants selling things to a global audience. Did that fundamentally change during the COVID era or was it something that was always happening and at some point, it hit enough critical mass that these problems become big enough that there's people out there trying to solve them?

Victoria Zuo:

I think COVID is very much of a catalyst and a pushing force for changes that are already happening. If I had to draw the two biggest shifts within our e-commerce industry, one is globalization, two is digitization. And these trends are, in my opinion, just never going back despite COVID "ending" for society. And I think COVID is just a pushing and a catalyst force in furthering globalization and digitization in both consumer and B2B purchasings.

Bill Cilluffo:

That makes sense. I would imagine the trends continue, right? I mean you still have a number of folks working remotely and I know there's been some highly publicized incidents of companies wanting their people to come back to work and that not going so well. So it's going to be fascinating to see where that heads. More and more companies we're seeing are hiring people independent of where they live, including overseas. And this is just going to lead to more and more. If you were to pick out in this international trade area within e-commerce, if you were to pick out a couple specific problems that you've seen companies trying to solve, what would be a couple that you might highlight?

Victoria Zuo:

Yeah, so there are probably three or four areas that are super exciting. One is likely interest rate and global effects management. I'll give you an example. A lot of e-commerce merchants are buying ads in US dollars, paying their vendors in China or in Southeast Asia, selling their goods all over the world. And there's usually a timing lag between all of these events. If a CFO of a e-commerce business is better at predicting the timing of these events, they should be able to hedge for FX fluctuations in these timing deltas. But a lot of times, it's just a very uncertain projection. So Fintechs could very much help CFOs manage their treasuries between currencies a lot better. So that's one.

Two, as you know, we have been very excited about working capital gaps in between countries for B2B merchants. There's a lot of timing lag between a shipment is manufactured, is shipped out, is received, and is sold and there's a lot of capital gaps in between these events. So how Fintech can help with bridging these gaps is also very, very exciting.

And lastly, one of the critical missing pieces for e-comm global shipments is taxation, compliance, import and export duties. So sales tax automation in the US has already been quite optimized, but as folks are selling internationally, even the US merchants selling in Canada is actually quite a hassle with the help of folks like Global-e or Shopify Markets Pro. And I definitely see a lot of opportunity in fintechs being able to help automate these processes and enable not only the biggest merchants, but also the mid-market and the long tail to be able to tap into global markets.

Bill Cilluffo:

That makes sense. Do you have an estimate for how big this global e-commerce is? I mean, obviously, a ton of e-commerce is within a single country. Here's a US merchant selling to Americans, and I think those problems are probably relatively straightforward, but what you're describing is, hey, I source my product in one country, I produce it in another, I sell it in 28 more. How large is this business becoming?

Victoria Zuo:

I feel like global e-commerce is definitely one of those markets that you don't really worry about TAM constraint. And I am a firm believer that globalization is just a trend that's not turning back. So I often like to quote this example for US merchants, there are just so many Away suitcases or Casper mattresses that you can sell to the US population. There are 300 million people in the US and after you've sold everyone a mattress, you are done and you have to move outside of the US. I think for a lot of categories where quality and brand identity matters more for consumers, US merchants actually have a huge advantage over global competitors. For example, we've seen a lot of growth in US personal care products internationally, a lot of baby products, a lot of personal electronics. And with CAC rising rapidly within the US and a lot of market penetration and saturation in the US, I definitely see a lot of opportunities for US merchants to go more global, tap into the global audience and start monetizing traffic that they're already getting from international audiences.

Bill Cilluffo:

Yeah, that makes sense. It was funny, as you're using Casper as your theoretical example, I was doing the math myself. We just had to furnish a new beach house and we bought six of them. We allowed Casper to keep that curve going a little longer, but now we're done. So now they've got to sell somewhere else.

Victoria Zuo:

Yeah, exactly. Exactly. Exactly. To add on to that, a lot of merchants are actually already getting a lot of traffic from their international audiences because a lot of them are creator and influencer-driven, and fortunately, the US has the best entertainment and creator community compared to a lot of other countries. So say like Jessica Alba is already very famous internationally and The Honest Company is likely already getting a lot of international traffic without paying for additional ad spend.

Bill Cilluffo:

Yeah. Let me just pivot off that. I mean the creator economy, I know is something that you've spent a fair amount of time thinking about and where does this go and it's becoming quite the force in terms of advertising. I mean, where do you think this thing's headed? What are some of the current trends that you're seeing in that sector of commerce?

Victoria Zuo:

As you know, I've spent a lot of time in creator-integrated commerce. So one of the key insights coming out of it is with Apple changing its cookie tracking policies and with Google also starting to enforce more strictly its privacy regulations, we're seeing a lot of the blind targeting not work as well for merchants. However, for creator-driven brand identities and ads, that whole algorithm and schema is still working quite well because creators are directly selling to direct followers and their communities. So conversion in this category is fantastic.

The challenge here however, is scaling creator affiliate programs. There's not a lot of data behind conversion, so brands aren't able to effectively find creators that work for them. There is not a lot of automation in terms of collaboration between brands and creators, so a lot of it is agency-driven and quite manual and pay-ins and payouts, direct order placements are all relatively cumbersome in today's world. So, I think there's a lot of opportunity for software to come in to make creator commerce more scalable, more [inaudible 00:24:18], for purchasing to happen in a more integrated fashion, for payments to flow more natively rather than having multiple middlemen in the process. These are definitely a lot of driving forces to my investment thesis these days.

Bill Cilluffo:

No, that makes a lot of sense. So where does it go from here? Obviously, it's an area that's changed a ton over the last 20 years, had this inflection moment at COVID. I assume this is still something that will change dramatically over the next 10 years or so. What are some of the things that you see happening out into the future?

Victoria Zuo:

I think one of the first things that I would love to note is the movement towards e-comm is so just beginning. If we're comparing ourselves in terms of US e-comm penetration sitting currently at about like 15% to our neighboring or friends across the pond, the UK is currently at about 38% e-comm penetration and China's over 50% of e-comm penetration. So, I firmly believe that e-comm penetration in the US is just starting and we're not close to the end of this trend.

And two is globalization and continuance of shopping across borders, being able to pay cross borders, being able to return and manage logistics cross borders is going to be a very defining characteristic in e-comm. And lastly, commerce is just going to be more and more integrated. It's going to be happening at video watching, it's going to be happening inside of software that we're already using. It's going to be happening in WeChat groups or Facebook groups or WhatsApp groups. We're going to see more and more of these integrative forefronts and commerce happening where people are already spending time on.

Bill Cilluffo:

Makes sense. It's a long road ahead and I'm sure that's going to be dramatic. It's fascinating hearing you quote those stats. I mean, I think it was US, 16%, UK, 38. I mean, these are markets that are, in general, very similar to each other yet massively different. If you've got China over 50, I know Mexico is still in the single digits. I mean, it's fascinating to watch how different this transition is as we go around the world.

So hey, starting to move into a couple more tactical things, I mean, you've had the chance to lead the efforts for QED on a couple investments since you've been here. I wonder if you can talk about a couple of the companies that you've helped bring into the portfolio.

Victoria Zuo:

Yeah, happy to. Let me start with Fermat Commerce. It's the first investment that I made at QED. It is a pretty defining characteristic to commerce. If we were to think about Commerce 1.0 as everyone buying products from a marketplace like eBay or Amazon and Commerce 2.0 as people placing ads on Facebook, optimizing for conversion and pointing all the content pieces to one single experience, I really think Fermat is building a Commerce 3.0 experience in creating this distributed integrated commerce experience. It is helping merchants and advertisers optimize for each piece of experience that's corresponding to each piece of content. And each piece of content could be a blog post, a Facebook ad, a TikTok video. Every piece of these contents are uniquely pointing to a optimized locally experience. So it is increasing return on ad spend dramatically for a lot of brands they're working with. And it is really helping this mid-market going after the big advertisers and big marketplaces in competing for market share. So very excited about what they're doing and they've been growing quite rapidly as well from a metrics standpoint.

And one of my more recent investments is this styles company that's helping companies utilize the mobile wallet channel, the Apple wallets and Google wallets. They're helping these companies push notifications to consumers' phones with just a mobile wallet pass installed. So historically, companies can only utilize tools like SMS or email or app notifications to communicate with their audiences, but it obviously has some deficiencies including high cost, low open rate, less dynamic. So this new company that we just invested in is helping address a lot of these disadvantages by enabling a mobile wallet, push notifications and building campaigns for companies in this category.

Bill Cilluffo:

Super exciting company and the potential of what they're doing there.

Victoria Zuo:

Yeah, super excited about what they're building and they're going after some pretty exciting companies across the world, and it's not just commerce and brands that they're helping with, they're going after financial institutions, insurance, grocery stores, so some pretty big enterprise level announcements coming up soon.

Bill Cilluffo:

Awesome. Awesome. Well, I'd love to move now to our last section, which is talking maybe a little more personally and talking about leadership and how you think about the job to some extent, and moving off of the subject matter. If we were to pull folks at QED or pull your portfolio companies or past colleagues, what would folks say your superpower is?

Victoria Zuo:

I think it's likely going to be around really listening to what people are saying and not just hearing what I want to hear and really listening to what people are saying and building alignment on top of that. As you know, during investment processes or in boardrooms, there are a lot of strong personalities and different opinions, and people are operating under very different incentives. And I think part of my superpower is really understanding and listening to the voices and helping to build alignment across teams.

Bill Cilluffo:

No, well that's a powerful one. I mean, this is an odd industry where you're working with so many different people across so many different firms, and you're right, I mean people have different incentives, they have different cultures, they have different ways of problem solving, and how do you find a way to bring all that together to create powerful outcomes is really critical. If I were to shift gears on the other end, what's one thing you really wish you were better at and you might be working on?

Victoria Zuo:

It's reading faster, actually. It might be a stupid one, but I obviously read a lot both out of interest and for the day job. And being able to read faster is going to save me a lot of time. And I used to think this is just an element of English not being my first language, and some people just read slower like me, but I've actually recently been picking up on a lot of techniques that you can use to read faster and I think hopefully it will save me a lot of extra time.

Bill Cilluffo:

I've moved from reading a little less and listening to a lot more podcasts and the 1.25 button was a very nice way to get faster. I can't quite get the 1.5 yet, that's that's a little too fast for me, but maybe I'll get there at some point.

Victoria Zuo:

Yeah, yeah. It definitely depends on the narrator. I just remember during college when I was in computer science classes, oftentimes people listen to lectures on 1.5x speed and it's definitely saving a lot of time for the college version of Victoria.

Bill Cilluffo:

Yeah. No question. No question. So you've been at venture now for several years and have made a number of investments, seen a number of companies across multiple firms. I mean, if you were to say what are one or two traits that successful founders have that you really appreciate or things that you look for when you make new investments? Anything you can share on that?

Victoria Zuo:

I really think people underestimate spikiness in founders in terms of one special thing or a couple special things that they're really, really good at, either recruiting, either technical talent, either just brilliant charisma or being able to drive rapid growth. In the early stages, sometimes we're trying to poke holes at businesses and try to make sure everything is perfect and there are no shortcomings, but I think, sometimes, it takes us down the wrong route and ignores being able to recognize spikiness in companies and teams. I think those are some of the companies that eventually become enormous.

Bill Cilluffo:

And truly no founder ever has all the skills they need, right? So if they can be truly world-class at a couple things, especially if they're able to recruit very complimentary people to join their team, I can see where that makes sense.

Victoria Zuo:

Exactly.

Bill Cilluffo:

In your time, what's one thing that you think you either got wrong or you underestimated, or if you had to go back and change something? I mean, obviously in this business, there's only so high a success rate for deals, so there's always deals that work, deals that don't work. But if you were to abstract from that, what's one thing that you might think differently now that you've got several years of experience in the industry?

Victoria Zuo:

I think it's endurance and how long it actually takes to go from zero to one. I often say that I grew up in venture in a pretty different time in your post 2018 like hyper growth, when C to series A happens in a matter of six to eight months and people are able to raise on nothing. So I think in this process, really learning patience, endurance, really on ironically saying this is a marathon, not a spring, has been a pretty real realization for me, and it's more important than ever in today's market, both for funders and for investors operating under the current market.

Bill Cilluffo:

Yeah, it's fascinating to watch the dramatic change in cycles over the last several years. I mean, I guess I started in venture in 2014 and was lucky enough to have five years of relatively stable, improving nice industry and then all of a sudden, four months of thinking the whole world was going to end and then 18 months of this big crazy boom the world's never seen and then all of a sudden, we're at a low point now, although a low point in which clearly the market is still there and vibrant and deals are happening. So it's one thing I appreciate about venture is as soon as you feel like you know what you're doing, the world changes. You've got to learn it again.

Victoria Zuo:

100%, 100%. And fundraising is just such a small piece of operating a company, so the race to get to the next round is really not the most important piece of building a business.

Bill Cilluffo:

Yeah, no question. No question. Well look, one question that we typically like to end with, I've got one more actually after this for you, but what's one tip you might share with aspiring entrepreneurs who might be listening to the podcast?

Victoria Zuo:

I think it's really thinking about the shape and form of the business. If everything goes well in say like a five to eight-year horizon, I think a lot of founders and CEOs go so deep and so niche into daily business operations, especially having worked on the business business for two to three years. A lot of the more higher level mission statement and vision statement gets lost a little bit. And really thinking through both the Xs scenario but also vision statement is quite important in the storytelling exercise and what drives them to build what they're building is actually a very critical piece in my relationships with funders.

Bill Cilluffo:

Oh, that's great. That's great advice. I'm sure they spend most of their day-to-day on the very tactical things that they have to get done that day, but you always need to keep a sight on the long-term picture as well. Makes sense. So last question for you then, lots of people out there would love to be pitching you, what are some of the things they should keep in mind and how can they get in touch?

Victoria Zuo:

Well, getting in touch is the easy part. I'm Victoria@QEDInvestors.com. I think I'm pretty good at responding to most outreaches that I'm getting. Part of the things to keep in mind is sharing the story, the progress, and where you want to be in the code outreach emails. Sometimes, it is a little bit hard to understand whether the company is at the beginning stage of their formation or they've already built a full product or they already have customers from the initial emails. And having a clearer understanding of that before first meetings is very helpful in me both prepping and in me adding value from the first time that we chat.

Bill Cilluffo:

Oh, very helpful. Well, Victoria, thanks so much for joining today. It was great getting a chance to chat and dive into both your background and what you think about, in particular the e-commerce world. So, really appreciate you spending the time. And to our listeners, thanks so much for listening and please keep following us on all of the places you listen to podcasts, and look forward to seeing you next time.

Victoria Zuo:

Thank you for having me.

Bill Cilluffo:

This has been the Fintech Thought Leaders podcast, your window into the world of venture capital and financial services with today's digital disruptors. QED is proud to provide the best fintech advice you can get. To learn more or to read the full show notes from today's episode, check out QEDInvestors.com and be sure to also follow QED on Twitter and LinkedIn at QED Investors. Thanks for listening.

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