VC Corner Q&A: Tess Hatch of Bessemer Venture Partners
By: The Startup Grind Team
Tags: Entrepreneurship, Venture Capital, Vc Corner, Funding, Startup

Tess Hatch is a vice president at Bessemer Venture Partners primarily focused on frontier tech, specifically commercial space, drones, and autonomous vehicles. She currently serves as board director for Phantom Auto and Spire Global and board observer for DroneDeploy, Impossible Aerospace, Iris Automation, Rocket Lab, Velo3D, Forever Oceans, Crosschq, and Smule.

Previously, Tess was a mission manager at SpaceX where she worked with the government on integrating its payloads with the Falcon9 rocket. She also worked at Fictiv, a startup using 3D printing and CNC machining to democratize access to manufacturing.

Tess earned a Bachelor’s degree in aerospace engineering from the University of Michigan and a Master’s degree in aeronautics and astronautics engineering from Stanford. She is passionate about space exploration and imagines a future where we all travel to space. She hopes to make the trip herself soon.

— What is Bessemer Venture Partners’ mission?

Bessemer helps visionary entrepreneurs lay strong foundations to create companies that matter, and supports them through every stage of their growth. As for my personal mission in investing, I believe we need to be a multi-planet species in order to survive. When I say this I am not giving up on Earth, rather, I believe that space exploration and development will help us fix Earth’s problems. For example, the development of MRI and CT scanning technologies, which save lives every day, were an unintended side benefit of the Apollo Mission.

I want to invest in technology and people who believe as strongly as I do that deep tech will help society in ways (perhaps some unbeknownst) such as this. Imagine drones delivering emergency medical supplies like AED devices or EpiPens that can save a person’s life during a heart attack or allergic reaction. Imagine clean meat decreasing carbon emissions dramatically and allow us to sustainably feed our population using a fraction of the water that we now use. Imagine all of the other deeply technical industries that we need to invest in to develop solutions for societal problems.

— What is one thing you are excited about right now?

The stratosphere. We have airplanes and drones in our airspace and satellites in space, but what about the space in between: the Stratosphere? Imagine if one wants to loiter over a single point on the Earth for an extended period of time, either to maintain situational awareness and consistent surveillance over an area of interest or to maintain communications with that particular area, for example, during or after a natural disaster. Drones and satellites aren’t optimized for this particular mission. I believe that platforms like balloons, blimps and high-altitude-long-endurance (HALE) fixed wing aircraft are more capable of being able to loiter at 60,000 feet over an area of interest, and if outfitted with various sensors, they can accomplish these important missions in a more effective and efficient manner than airplanes, drones, or satellites.

— Who is one founder you think we should watch?

Peter Beck, CEO/founder of Rocket Lab, is opening space for business with the Electron Rocket, a small rocket designed to take CubeSat satellites to low-earth orbit. He has successfully launched 10 (out of 10) rockets to space deploying 47 satellites and expects to launch at a weekly, if not more, cadence in the near-term future.

— What are the 3 top qualities of every great leader?

1. Passion

2. Growth mindset

3. Grit/Resilience

— What was your very first investment/when? And what struck you about them?

Iris Automation in 2015. The current bottleneck in the drone industry is flying beyond the pilot’s visual line of sight. Imagine if you want to inspect hundreds of miles of oil pipeline or railroad tracks, or hundreds of acres of agriculture. It defeats the point of the drone if the drone pilot has to run after the drone during its mission. Iris has invented a detect and avoid system, analogous to a pilot’s eyes, that helps the drone avoid other objects in the airspace and making evasive maneuvers when needed. I believe Iris’s technology will release the inhibitor of the industry, which is restricting the industry from growing into the massive market some analysts forecast. This catalyst technology is a good illustration of how technology can change and improve society.

— What is one question you ask yourself before investing in a company?

I ask myself a lot of questions before an investment. Why now? Why this team? What are the future exits for the company? But the most important question that I ask (and that the company should be asking) is why Tess? I believe an entrepreneur should do as much due diligence on the VC as I am doing in the company (which is a lot). Please call up every CEO/founder/person with whom I have worked (I usually give a long list of names and encourage the entrepreneur to find people who are not on that list) and ask how it is working with me and whether I support founders and companies through the highs and especially the lows.

— What is one thing every founder should ask themselves before walking into a meeting with a potential investor?

Why am I meeting with this specific person, not firm, and what can she do to help me? I love when entrepreneurs have done their homework and researched more about me so that we can have a deeper level of conversation. I write about and publish my thoughts on my sectors (space, drones, AV) and am humbled and delighted when they have read the articles about their industry and have opinions or questions about what I have written, especially when they disagree with me. Furthermore, I like when an entrepreneur has a question or request for me to follow-up on after the meeting, it shows a sign that she is doing her due diligence on me to see how I would be as a board member and partner and I surely follow through on my homework!

— What do you think should be in a CEO’s top 3 company priorities?

1. Culture/Diversity

2. Building a Competitive Moat

3. Knowing your north star but being lean enough to pivot and change paths when needed

— Favorite business book, blog or podcast?

I love reading Heidi Roizen’s “Help Me Heidi” blog where she answers VC101 questions in a tongue and cheek way like “Dear Prudence.” I shamelessly sent her a ton of questions when she was first getting it started and love reading her responses. They are very informative but also entertaining, a hard combination to have when answering questions involving stock options and data rooms.

—What is your favorite thing to do when you’re not working?

Biking. I am training for a team half ironman with two of my Bessemer colleagues and I am doing the biking portion. I also hope to bike from Carmel to Hearst Castle (100 miles) in September for the Best Buddies bike ride, a great organization that promotes the inclusion of people with disabilities.

— Who is one leader you admire?

Gwynne Shotwell, the president of SpaceX, is an excellent role model for everyone, but especially young females in engineering. When I was working as a mission manager at SpaceX, I had the pleasure of meeting and talking to her on a number of occasions. I loved when she would walk down the main rocket aisle floor in her red sole Louboutin heels, proving that style and substance are not mutually exclusive concepts.

— What is one interesting thing most people won’t know about you?

I didn’t know that venture capital was a career when I was an undergrad studying aerospace engineering at the University of Michigan. My younger self would have been shocked but delighted that this career exists where I’m able to use my passion for engineering and partner with a variety of deeply technical founders with brilliant ideas and help them grow into market leading businesses.

— What is one piece of advice you’d give every founder?

Diversity is incredibly important and should always be top of mind from the very creation of the company.