“Doubling Down” is a new series where we hear from top B2B SaaS investors on their most recent activities and takes on the current market. We had a great one last week with Nina Achadijian, Partner at Index Ventures. Check that out here.
This week we’re focusing on Erica Brescia, Managing Director at Redpoint Ventures!
#1. What’s your most recent disclosed investment? Why did you do the deal?
Poolside. Jason Warner, who was CTO of GitHub before and during my time as COO there (and a former partner at Redpoint!) joined forces with the incredibly talented Eiso Kant to build the world’s most capable AI for software development. Their vision for the future of software development jived completely with ours at Redpoint, and I couldn’t imagine a better or more experienced team to take on this herculean task given that GitHub Copilot was built by Jason’s team and Eiso also previously built a company in the space. When taking on something this ambitious, founder-market fit is paramount, and Poolside has it in spades.
We led Poolside’s $26M seed round because as investors, there is nothing more exciting than partnering with a team whose vision could truly change the world, especially when that team has the experience, network, and conviction to execute that vision.
#2. What’s your sweet spot for investing — check size, stage, type of deal? And how big is your current fund?
I’m a Managing Director on Redpoint’s Early Stage team, so I spend most of my time looking at companies that are still very early in their journeys. Typically, these companies range from seed stage to Series B, though most of my investments in 2023 were Series A investments.
We are currently investing out of our 9th Early Stage fund, a $650M vehicle. Our check sizes
range from the low single-digit millions up to around $20M, depending on the stage of the company, market and the capital needs of the business. We also have an early growth fund, which invests in Series B and C rounds.
#3. What’s the #1 bit of advice you’d give to SaaS founders today?
I’m going to cheat and give you two 😉 The first is to focus on building a high-performance culture from day 1. Culture is incredibly hard to change once it is established, and hiring an incredible team out of the gate and then creating an environment where they can do the best work of their lives will set the stage for all future hires.
The second piece of advice is to focus on efficient growth over growth at all costs. Especially in this macro environment, investors don’t just want to see top line revenue growth; they want to see that you can achieve that growth with sound business fundamentals.
#4. What’s your pulse check on the venture markets right now, today?
The pace of innovation in AI today is like nothing I’ve ever seen before in my career.
I firmly believe that within 5-7 years, the vast majority of code will be written by computers instead of humans. This shift has huge implications for the way that we will think about “work.” The move to mobile devices and constant internet access fundamentally changed every aspect of our lives, and AI will have an even more significant impact in how work is done and how we spend our time. As a parent, not knowing exactly what that might look like is a little terrifying, but as an investor, it is incredibly exciting to be in a position to fund and help build companies that will drive this change.
#5. What’s different about your fund / how you invest and support founders?
All of our Managing Directors on the early team have both founded companies and operate at scale. We’re so passionate about supporting our founders, and are deeply empathetic to the trials and tribulations they’ll face as they travel on the epic journey that is building a successful company. We’re also all equal partners, and have equal (not deal-by-deal) comp at every level for our whole investment team. This serves 2 powerful purposes: first, it is a great filter for who we bring into the Redpoint crew – we want teammates who want to win as a team. Second, it makes sure that everyone is incentivized to support our founders and portfolio companies in every way possible – regardless of who might have led a particular deal. We have such a great range of experience across our team, from both a technical, sector and business model perspective, that it it is great to be able to tap into this for the benefit of our portfolio companies.
#6. What’s an “exit” you’re particularly proud of?
As a former operator and founder, I’m probably most proud of building my own company, Bitnami. My co-founder and I only raised $1m for Bitnami, and we were acquired by VMware in 2019 when we were at 75 people and about to launch a new line of enterprise products. I’m confident this experience made me a better partner to founders because – between Bitnami and GitHub in particular – I’ve seen just about everything!
You don’t really know how tough a founder’s life is until you’ve experienced it firsthand. At first glance, ducks look tranquil while gliding across the water, but under the surface, they are paddling like hell just to start afloat. Founding a company feels the same way. The journey is often lonely, demanding, and stressful, but it was one of the most thrilling and rewarding periods of my life.
Erica Brescia is a managing director at Redpoint Ventures. She invests primarily in enterprise software with a focus on DevTools, Infrastructure, AI, Security and open source. Thus far, she has led Redpoint’s investments in Dagger, Railway, Xata, Zed, Fixie, Poolside and an unannounced infrastructure company. Notable developer-first companies that Redpoint has invested in include HashiCorp, Snowflake, Stripe, Twilio, and LaunchDarkly, among others. Prior to Redpoint, Erica spent close to 20 years as a founder and operator. She founded Bitnami, which was acquired by VMware, and served as the former chief operating officer at GitHub. She has also served on the board of directors for the Linux Foundation for over 8 years.