68: What VCs Want from Tech Talent | Engineering Careers with Melanie Nabar

Bethany (00:00) Welcome to the Overcommitted Podcast, your weekly dose of real engineering conversations. I’m your host, Bethany, and I’m joined by

Erika (00:08) Hey I’m Erika

Bethany (00:10) We met while working on a team at GitHub and quickly realized we were all obsessed with getting better at what we do. So we decided to start this podcast to share what we’ve learned. We’ll be talking about everything from leveling up your technical skills to navigating your professional development, all with the goal of creating a community where engineers can learn and connect.

Today on Overcommitted, we’re so excited to be joined by Melanie Nabar, principal at Volition Capital, a Boston-based growth equity firm focused on founder owned capital efficient technology. Melanie leads diligence on new investments at Volition, sits on the board of digital onboarding, and is a board observer at Haas Alert, Zenerate, ABCS Insights, and Halo. Her job essentially is to look closely at technology companies, the engineering teams, the products, the founders.

Decide whether to back them and then stick around while they scale. We’ve talked to a few founders on the podcast, so we’re really excited to have her talk about what the view looks like from the other side of the table and what it means to for the way we build software. Welcome Melanie.

Melanie Nabar (01:13) Thanks for having me. Excited.

Bethany (01:16) so excited to chat with you. start us off as we start off every episode. what is one thing you’re currently building or obsessed with learning right now?

Melanie Nabar (01:26) Yeah, it’s a great question. I love this kickoff question. right now I am obsessed with building agents to simplify my life, to take a lot of that mental load that we have every day. You know, everything from like grocery shopping to what you’re gonna cook and recipes and who you’re gonna reach out to, when people’s birthdays are. Like there are so many ways that I think we can start to leverage this technology to make

Our lives easier and maybe make us better friends, better partners, and also just give us more time to focus on things professionally as well.

Bethany (02:04) That’s so relatable. I feel like I’ve been definitely using agents a lot for work and and stuff, but it’s slowly dripping into real life where it’s it’s like, I I could use an agent to simplify this or I could use AI to simplify that. so that’s really cool. That makes a lot of sense. I would love could you walk us through what exactly like a day in your life looks like for

Melanie Nabar (02:14) Yeah.

Bethany (02:32) your role at volition, like how h how are you interacting with these companies or sourcing different companies to invest in?

Melanie Nabar (02:41) Yeah.

It varies a lot day to day, which is part of why I love my job. it could be anything from, you know, I could be in Detroit, visiting with companies in the area, getting to know CEOs in person. I could be, you know, on Zoom calls with CEOs, talking through their vision. We could be working on a a new investment, in which case

Could be anything from, you know, analyzing data to conversations with different functional leaders to industry conversations, trying to validate the market need. or it could be a a board meeting day where, you know, we’re heading to spend time usually in person, sometimes remote with our executive teams and chatting through like what’s working, what’s not working, what’s keeping them up at night, and then finding ways for us to be helpful. So there’s a lot of variability.

Bethany (03:36) I can imagine that with the different aspects of of your job. if we could maybe focus on the part where you’re looking into these investment opportunities, I know we’ve heard a lot about that it’s really the company that matters or like the organization that matters. So I’m curious what exactly are you looking for for these engineering teams that you might write big checks to?

Melanie Nabar (04:04) Yeah, it’s

a great question. I think if you were to go back, you know, a year ago, the the diligence on an engineering organization would be quite a bit about the product. So we usually hire a third party because I’m not technical as much as you know, I building agents for what I should shop for in my grocery shopping is not the same. And so we will hire third-party firms to assess the code base, to talk through their processes, basically figure out where we can up level the org.

and then that would be the extent of it in addition to put you know, what’s the product roadmap and what do customers think about the product and things like that. now I think we’re doing a lot more assessment on how organizations are run. And that is just as important as the product and the market and the customers. I’d say all of those plus the founding team, like those are all the equal parts. And now we’re thinking about, you know, how are you engineering? Like how

How have you built out your AI harness? Like how are you deploying it within your organization? Because as much as you’re backing the existing product, you’re moreover backing the innovation of the company and believing that the founders and the management teams will stay ahead of the curve because it’s become so competitive, so easy to start to deploy code and features. And it becomes really important that you think the team

that’s in the seats or that you could bring on as well can stay ahead of that curve.

Erika (05:40) Does that look different depending on the type of company that it is or like the stage? or is it pretty like pretty much cut and dry of like we look for these same things in all the companies that we look at?

Melanie Nabar (05:54) Yeah, it’s a great question. It definitely depends on the stage a bit. if we’re coming in and investing in a company that’s say four million of ARR, well, no wonder there’s gonna be some things that need to up level over time, right? So there might be a little bit more leeway because you’re coming in earlier from a stage perspective and also earlier from a valuation perspective, right? So you’re maybe willing to take on a little bit more of that organizational risk because it’s slightly easier to get the upside since you’re earlier.

and then flip side is if we’re investing in a business, you know, that’s 25 million in ARR, well, we would hope that you have leaders in place that really know what’s going on. We’d hope you have really strong processes and that these things are are thought through. and so yes, yeah, definitely there’s a little bit more leeway the earlier you are. flip side is when we look at businesses that are earlier, that we may think, yeah, who knows?

what this organization and what the processes are gonna look like. Sometimes that’s what’s what blows us away. Because especially now, I think agile organizations that have been able to adopt AI tools and strategies more quickly sometimes are ahead of the curve. and that can be a beautiful thing, right? Because it’s a small org and they’re ahead of where they should be. And I think there’s a lot of value in that too.

Bethany (07:18) That makes so much sense. it’s interesting the impact of AI development and ensuring that you have those strong foundations early on. how are you sourcing these these companies? Is a do you often look at the founders first or are you looking for the product first and then viewing that founder fit and organizational structure after that?

Melanie Nabar (07:43) Yeah. So first we’re usually thinking about the market, market opportunity, like tailwinds that are going on broadly where we think, there could be something here. This is a big market. sometimes conversations breed ideation. So you might talk to one founder and you know, they’re actually talking about a problem they’re facing. And that might spur you to say, well, I wonder if there’s a technology company solving that and kind of go down these different rabbit holes.

We have also a bunch of analysts and associates who are rock stars who basically canvass the world for like private companies, companies that are, you know, not in the public markets. and they look for different signals. we now have open claw, we have agents that are going out and looking for things like could be news articles, it could be looking for, you know, second time founders, it could be looking for, you know, testimonials on different custom different companies where

wow, like this company looks small. There’s only maybe 12, 13 people, but Reddit is exploding because like people love this platform. So there’s a lot of different places to find it. Sometimes it’s signal, sometimes it’s market, sometimes it’s luck. Like we’re going to conferences and we’re trying to talk to everybody. And every once in a while, an under the radar company crops up that is just absolutely crushing it and things align. They’re looking for capital. We can prove we’re gonna be good partners and it comes together.

Erika (09:11) And yeah, so so you find the company and then do they always give you a pitch or is it sometimes like you move past that and start like sort of the analysis side before you kind of get that formal introduction?

Melanie Nabar (09:27) Yeah.

So we’re usually building a relationship first. if you’re going to give somebody a piece of your business, it’s a very personal choice. So candidly, by the time we’re coming in, which is when folks have no real revenue and are growing quickly, they’re usually hesitant to open themselves to investors. and, you know, we have to prove that we align in terms of how we think about businesses before they’re

open to sharing a lot of the nitty-gritty and data. So the process usually looks like, first conversation, spending some time in person. That could range from they’re raising right now and we’re going to the next stage right away to two years from now they decide to raise and we just build the relationship over time. And then once you know they do decide they’re going to raise capital, then we are doing some information sharing. We’ll typically focus mostly on getting to know the founders in the beginning and getting

Data from them. Sometimes the CFO or sometimes it’s chief of staff, depending on the stage, will be helping out with data sharing. And then once we kind of agreed on evaluation and partnering, that’s usually when founders will open the aperture to the rest of their team. Sometimes the technical leaders are a part of the founding team, actually a lot of the time. So they’re already involved. Sometimes that’s coming a little bit later once we’re really in diligence. and at that point, once we agree on evaluation, we’re trying to close the investment in.

30 days and during that time period we’re spending time with as many folks at the company as we can. typically VP level and up because it’s just too many people for us to meet. And also, you know, leaders are going to be protective of their producers’ time. and so we’ll spend time with different functional leaders there and kind of get more into that nitty-gritty.

Bethany (11:18) Yeah, that’s I I think it’s so interesting that it’s really about this like relationship building as much as it is interviewing them or analyzing what it what the company’s worth. It’s really about making making folks feel like this is a a equal relationship, equal like footing and and things like that. So I I remember we when we were buying a house, that was one of the things we were

struck by is that our realtor was very invested in building that relationship so it took us like a year to actually go through the process but I know that just even with that purchase it was a big deal so I think that makes so much sense to invest so much in that relationship building and however whatever timeline that looks like.

Melanie Nabar (12:02) Yeah.

Yeah. It’s kind of like if that realtor was like living in your basement. You know, because we it we do the investment, we do the deal and it’s it’s not done. Like we stay involved for the next yeah, could be five years, could be ten years. So that is a good analogy, but it’s like we stick around, which I’m not sure you would want in this in this analogy.

Bethany (12:17) Yeah.

I don’t know, he’s really cool, so maybe maybe I would like him in our basement.

Melanie Nabar (12:38) Yeah, maybe. Good addition. Yeah.

Erika (12:43) Yeah, so I guess at that point of the pipeline. So like after you’re invested and you’re like you’re in the boardroom, like what are what are some of the things that you found to be kind of the most effective ways to like maybe move some organization in the right direction? Like what are the kinds of things that you’re looking for as like, this is what like this is what we can change to make you more successful or

Like maybe when you’re investing, you’re like, no, that’s never gonna change. Like this is not yeah, not worth the time.

Melanie Nabar (13:17) Yeah. And I’ll caveat this answer by saying we are minority investors. So we’re not coming in and buying the whole business or majority stake. And so everything that we’re doing at the board level, it’s ultimately management’s decision. but our job is to try to help folks skip mistakes. So there are patterns that arise, there are pitfalls people fall into when they’re building and scaling a business often. And our job is to kind of pressure test. So when you’re about to step into

pitfall, let’s at least push on it. And maybe you decide I want to do it anyways, and you have conviction and hey, that conviction is why we backed that management team. So that’s fine. They can still go ahead and do it. And sometimes it they may be right. It could be the outlier. so I’ll caveat it with that. But I think as it relates to the audience here, which is sounds like it’s really mostly engineers, I think there are a few places that teams

struggle that I think we’re able to pressure test. And one of them is like if you can’t measure it, you can improve it. And oftentimes when we first get involved, all of the teams, whether it is engineering or sales or whatever, are small enough that you can you can kind of all go in the same direction. Everyone’s like building together. And so you you feel like everybody has ownership. But as you scale, not every person you hire is going to feel that same ownership as like the first 10 people at the company, right?

And so you start to need to measure. And I think a lot of companies will they’ll talk in high level statements, gut feel, but at some point you do need to start measuring those things. And I think engineering is one of those places that for the board is often the biggest black box and also usually one of the bigger spend areas, too. and so I always tell engineering leaders, I we actually just hired a new VP of software at one of my companies, and he asked me at our first board dinner, like,

What do you want to see? And I said, what do you measure? Like anything you measure, I want to see. And it doesn’t mean that I understand some of these measurement things. Like I don’t really, I’m like, hey, what is that? Is it good that it’s up? Is it good that it’s down? Like we’re not engineering leaders ourselves. But at least if you’re measuring it, you’re starting to establish goals and you’re starting to see trends. And if you’re not measuring it, you’re going blindly by gut feel. And it’s actually one thing that

Like AI and having a strong AI harness can enable for engineering leaders is like now you know who’s creating the bugs. Like you can go and see, you can track that. it’s not like, I don’t know who created that. and you can see, you can see at a different level and measure at a different level, not meant to be big brother, but so that you can up level things. You know, you know where you are. So you know what you need to improve. And that is a beautiful thing. And I’m hoping that we start to see more measurement in the

than historically we have. Yeah, so that’s that’s definitely from an engineering perspective something a a pitfall people fall into is it’s just product roadmap slides. There’s no real measurement.

Bethany (16:25) Yeah, that’s I mean that makes so much sense that you all are not only in providing the capital and whatnot, but the mentorship as well. and that’s really interesting. And I I would love to talk more about the the measurement piece too. I think before that, mentioning the pitfalls and that being one of them, the lack of measurement. Has that has that evolved since AI really became a thing or has those pitfalls evolved at all where you’re seeing

Melanie Nabar (16:46) Yeah.

Bethany (16:57) different pitfalls now versus what you might have been seeing a year ago or two years ago.

Melanie Nabar (16:58) Yeah.

Yeah, maybe not quite a pitfall, but something every company is facing right now is how do we reorganize for this new AI world? a lot of companies are no longer having like product and engineering. Like now there are builders, right? And and you’re a builder. and you kind of it’s it’s more like we verticalized the the whole process. and

How do you enable folks in other portions of the organization who can now build to build? And where do you, you know, where do you stop that, right? Or do you keep that? and you know, people are using tools like lovable, for example. Like somebody in HR can build themselves something and they can launch it through lovable, like cloud code, lovable, and it’s a product. It’s crazy. It may not be security grade, enterprise, and it may be more of like a tool or feature than like a full product.

but I think people are realizing that with that ability meet comes reorganization and every company is is handling that. It’s also change management because everybody’s jobs are changing. I think people are further behind than maybe you know, you us three in the room think, like as a world from a world perspective, like enterprises are further behind than you think in terms of adopting a lot of these things.

But you know, obviously you all are developer right on the front lines. And you know, I’m talking to AI companies all the time. So it feels like it’s all happened, but it’s still happening. And every organization we’re working with is figuring out how do you manage there’s a fear component and there’s an opportunity component. And like how do you people don’t behave well when they’re scared. Like people make mistakes, people don’t make the right decisions when they’re in fight or flight. So

Like you want people to realize things need to change, but you also don’t want to instill like a crazy fear culture. That’s not good either. And so there is an element of change management a lot of our portfolio companies are dealing with. And we actually had an executive summit last month. we rented out a big piece of Fenway Park. It was a lot of fun, but it was also all about like AI, AI change management, people talking through like how did you announce this to your organization? Because some people have made some big swings.

Other people haven’t yet and they’re renicent and they don’t, they’re trying to decide how to do it. And so we’re trying to create as much real-time learning on something that’s new to everybody so that like each portfolio company can learn from each other all while this is happening live. And and I think that’s one place that, you know, being a part of a firm that has, you know, a number of portfolio companies and is in like leading edge technology companies can give.

you an advantage as, you know, a a company, as a part of that portfolio too.

Erika (20:01) Yeah. The two things that came to mind too as you’re talking is like there’s a third piece which is the learning piece. and like you can you can be open minded and like interested in trying this, but if you don’t have enough bandwidth or like room to grow, then you might not be able to even incorporate this into your workflow because like

Melanie Nabar (20:09) Yeah, good point. Mm-hmm.

Right.

Yeah. Right.

Erika (20:28) I’m so busy doing all the things that I have to do. Like I can’t figure out how to use this agent to do it. yeah. but I think I think when you were talking too, like in my mind it goes it goes back to those kinds of like goal tracking and and measurement pieces, because like then the add-on question is like, well, like

Melanie Nabar (20:31) Yeah.

Erika (20:54) We don’t want to use AI for the sake of using AI, right? Like you you want it right, yeah. Like essentially you like want it to make you better at your job. That’s the goal. But in order to know what better is, you have to know where your starting point is and how you’re measuring like those things. So like for myself, like it’s like, yeah, I think of like PRs created, like PRs merged.

Melanie Nabar (20:57) Right, right. Yeah. I think we’ve learned that that’s not a good strategy.

Yeah. Yeah.

Erika (21:23) like review time, bugs created, like those kinds of things are how I like measure my effectiveness. and like I’m constantly asking like Am I doing this faster because of AI or would it be faster to like just do it myself, do it by hand? and it’s it’s still very unclear like on a day-to-day basis. Like yesterday I I had AI write something and the feedback from a colleague was like

This took me probably three times as long to review because the AI like jargon didn’t make any sense. You know, it’s like, well then I just created more work for that person. so like that’s a learning moment to be like, Well, okay, yeah, think about how this comes across. yeah. So

Melanie Nabar (21:58) Right. Yeah.

Yeah.

It’s a great point.

I think I think a lot of companies they don’t yet know if they’re getting the ROI. in some ways, like yes, you can launch little features probably faster, but then like, do they create a bunch of bugs that create more work? And I think people are still figuring that out. but to your point, like some of it has to be learning, right? In order to get there, like you need to be there needs to be a leadership.

approval of like, all right, like are we going after this? And this is a big initiative. And you’re okay if I make mistakes because you told me we need to be completely AI forward and maybe we won’t see the results for six months, but like we know that. Or do you want me to produce the most like high quality XYZ now and whatever way gets us there? And that really comes down to like what are you measuring and and what does success look like, which a good leadership team should be

like tops down establishing so that you don’t have to play the guesswork of like what like which direction do you want me to go? Right. and I think that’s that was a big topic at our executive summit because there’s differing opinions. And I don’t think that one way is right or another way is wrong. I just know that no direction is definitely like the wrong direction. Right.

Erika (23:17) Mm-hmm.

Yeah.

Definitely. Yeah. Yeah. And I know I’m constantly learning from my colleagues too of how to better better use the tooling. ‘cause the tooling’s also changing on a daily basis. So yeah.

Melanie Nabar (23:45) Yeah, all the time. Right. Yeah.

We’re actually doing even internally at our firm, we’re doing like every Monday we do AI labs and different people present things that they’ve created and built. And not one of us is a technical t developer by any stretch, but I think a piece of that is just starting to get people’s minds going on what is possible and also seeing

Different folks get up there and present and realize, you know, hey, nobody really nobody already knows how to do this. Like this is new. So like it’s okay to to go up and and share something that’s imperfect. ‘cause maybe the next person will help perfect it to the next stage. So I think the whole world is in a learning phase. absolutely.

Bethany (24:34) Yeah, that’s really interesting. I think it’s it’s really cool that you all are invested in continually learning about this. Is there anything concrete you’ve learned from these that you’ve taken forward with looking at these these companies or looking or advising these companies from those labs?

Melanie Nabar (24:55) Yeah, no, it’s a good question. I think

Part of our advice to some of our companies has actually been like you should do just the labs in and of themselves, right? like you should be encouraging this. And like here’s an example. It may they may not take it the exact same way, but like here’s an example of how we’re doing it. And we’re not even a tech company. So, like it’s it’s a little bit of just pushing folks along. I think that’s been helpful, especially for

There’s a wide range. There’s a lot of most of our portfolio companies are miles ahead of us. Some of our portfolio companies, like, you know, it took them a second to get a little bit more comfortable getting in there. And now they’re there and and running probably ahead of us again. But I think just showing them like even we are doing this is helpful. we’ve also had actually our portfolio companies demo to us like things that they have built too to try to like get ourselves up to speed on what people are doing.

and then we have we’ve done some webinars too with different portfolio companies like presenting for each other. at the CEO summit, we had demos. So a bunch of people demoed what they had built internally. and I think it’s really just that attitude around like we need to be experimenting and like this is what could be possible that’s really, really stuck. As an investor, I think it’s helpful that I have been in the tools and leveraging them because there’s a lot of vapor.

There’s a lot of companies that are basically like a bunch of skill files in Claude and they’ve built an interface and like that’s the business. And I think if I, you know, they look cool and they do some helpful stuff, but they’re not defensible and they don’t need $20 million from us to to grow. Like eventually people are just gonna build this themselves. and so I think it’s been important for us to get in there and understand like what’s possible so that when we’re assessing companies, like,

At least the first blush of wait vaporware we can kind of see through. And then, you know, sometimes it requires getting a layer deeper. there’s actually a bunch of firms that are cropping up now that for tech diligence, instead of assessing the code, they’re like, All right, for 30 days we’ll try to build the product and we’ll see how far we can get like replicating this. And if we can replicate it in 30 days, like it’s probably not defensible. and so or like at least from that we can learn what pieces are

are defensible. And, you know, then you discard the product, obviously. But we haven’t done that yet, but I know there’s firms that are doing that. so it’s all about like knowing what’s possible so that you can assess properly. and I think it requires more of a technical knowledge set than it used to to be a tech investor.

Erika (27:37) Mm-hmm. Yeah, totally. yeah, and then there’s like the extensibility question. Like, I think you kind of talked about this, but like, yeah, like will this will this grow into something that will like satisfy the market? Like like is that market need big enough to to support this this growth that you’re estimating?

Melanie Nabar (27:45) Yeah.

Yeah.

Right.

Yeah. And hey, maybe what you’ve built like could be replicated, but you have this vision that like this is a Trojan horse, we’re gonna get in the door and like we have all these expansion products to become this like sticky platform and like that’s okay too. Like there’s no one size fits all. to your point on extensibility, I think it could go one of two ways. So

Erika (28:22) Yeah. So for like an engineer who might be at any stage of one of these companies, who might be like advocating for some kind of like feature direction, like do you have any advice on how to kind of think about like internal pitches? what yeah, what would what would you advise engineers kind of think about as they’re advocating for a roadmap or ideas?

Melanie Nabar (28:51) Yeah. two things. One, and this probably applies to every job, but I think it applies like when you are reporting to somebody who is then reporting to the board, like everybody wants to look good in a board meeting. And you know what makes you look good right now in a board meeting? Like AI adoption, right? so like if you can do if what you’re advocating for has an angle of like, hey, we need to show the board and you know, our investors that

We’re focused on this and this project, like I think it gets us there faster. Like that’s probably a good angle to use. the other one that, like, let’s take AI off the table for a second because the reality is there’s always new infrastructure changes and like change of future of work shifts. the thing that doesn’t change at the end of the day is like you want to serve your customers as best as possible to keep them around as long as possible. Because honestly, at the end of the day, you’re trying to earn as much revenue as profitably as possible.

Like that’s a business, right? and so if your project, if you can attribute numbers to that, like hey, we lost 12 deals according to our sales department. We lost 12 deals because we didn’t have that feature. That’s a half a million dollars we could have closed last quarter. That, you know, Jerry from sales says he could absolutely have gotten across the line if we built this feature. Like that’s that’s a beautiful thing, and that’s gonna get you to push whatever it is you’re pushing forward faster. because and

Candidly, like as much as it can be great to build like beautiful code and beautiful features, if it’s not solving a problem for a customer, like it actually isn’t the right direction for the business. And so it’s also probably a good sanity check as well. so

Bethany (30:39) You’ve mentioned this a couple times, but speaking of vaporware and anyone being able to build build products now, I am really curious, has that helped or hurt with finding new opportunities? has that has the number of opportunities increased or has it just there’s a lot of things that look shiny on the outside, like we were talking about, that aren’t actually profitable?

Melanie Nabar (31:03) Yeah.

Yeah, it’s a great question. There’s more companies than ever that are growing so quickly. And that is awesome. And I think that is unique at this point in time, where companies going from zero to six million in six months. Like we have calls all the time that people are doing that. Not that that’s easy to do, but people are doing it. And that is unheard of if you were to go back like

Three years, especially in a business to business, like you’re selling to a business. That’s hard. Maybe in consumer where you can get viral and and you know the flywheel can take off, but not in tech. And a piece of that is that everyone is trying to test things out. and so that’s kind of enabled this market of rapid growth. so that’s that’s interesting. That’s exciting. There are more companies that are getting into our range faster. Flip side is I think there are a lot of companies that are.

Going to see a tough like one-year renewal cycle. Like they’re growing really quickly, but people are kind of testing it out and then they’re going to churn. And maybe you locked them into a year contract, so they can’t really churn for the first 12 months. So, like there’s going to be some folks who get caught in this like whirlwind of growth, but then they don’t deliver on the product and promises that they had to their customers. And so that does make our job a little bit harder because a lot of companies are now in our scale.

But they’re not, they don’t necessarily have any renewal history. it’s actually really helpful that people are moving towards usage-based pricing because you can see usage, right? company that went from zero to six million in run rate, that’s on a usage base, like I can see whether customers are using it more or less. So I I know whether they’re enjoying and seeing value in the product. and so there to your question, are there more? There’s probably more in our range than there were before, but

The ones that actually have like proof points of true product market fit, I think that there’s probably the same amount. and it is a little bit harder now to answer that question of like, does this have a moat? there’s a secondary question of like, does it matter if it has a moat if it gets there first? Like, that’s, you know, people are also asking those questions. but at the end of the day, I think we are highly selective in who we partner with. We probably talk to

We talked to at least 2,000 companies a year and we would probably invest in four or five. now the founders we’re working with are also highly selective for sure on who they’re partnering with. But I think ultimately like our pace of deployment has been the same because there’s more companies growing really quickly that are interesting, but of those companies, it’s harder to believe that they’re gonna stick around and have a boat. And so you kind of end up in the same place.

Bethany (33:57) that’s and that ties back to the measurement side of things. Like the with when you have usage based pricing, then that automatically builds in that data set and data point on what the usage actually is. That’s so fascinating. Definitely. Well, pivoting a bit,

Melanie Nabar (34:10) Yeah. Right. Yeah, absolutely.

Bethany (34:18) One thing I am curious I’ve so I’ve personally never worked at a startup or anything, but I am curious what often happens once you invest in a company. how does the organization typically change? Is it something where they’re very motivated and work faster or is it something where it can really can start tanking momentum in a way? I’m curious what what you’ve seen in the where is it?

Never never the same.

Melanie Nabar (34:51) Yeah.

hopefully the goal is they take you’re taking capital and you’re you’re growing more, you’re increasing momentum. and that’s that’s partially because there’s more cash on the balance sheet, so you can hire more folks. A lot of times someone’s been wearing three hats and now they can just wear one and focus on the thing that they’re good at and they can get support. so that can be like a nice real moment for folks who are, you know, in the bottom of of the stack, kind of feeling that pain the most.

it also does mean that like your options are valued at something, which is a beautiful thing, right? Like you were given options and they had some arbitrary strike price, and you said it’s they said, if we’re worth this, that’s what your options will be worth. But now there’s actually a a new price. And so you actually know like how much you’ve increased in value. And so that can actually be really motivating for folks to know, like, okay, great, I want to stay because I want to venture options.

And I already know they’re in the money. Like I know that because these investors came in and this is what they said the company’s worth. So assuming nothing goes crazy, like you feel good. So that can be motivating. the mistake people make that impacts would impact somebody who is just working at at a startup would be hiring too many people too quickly. because it is hard to hire A players, and if you hire a bunch of C players

And you previously had A players, well, all those A players are going to be annoyed because these people don’t know what’s going on and it’s it’s dragging down productivity and it’s frustrating. And so two things happen. One, you waste capital because you instead of hiring two of those C people, you could hire one A person. and then two, it also can can frustrate some of the folks who really are high performers. So I’m always very thoughtful. you know, when we invest, I think.

One of the most common mistakes is like you just go out and you burn a bunch of capital and you just hire people. You think like, if we just hire 40 more engineers, like we’ll have our product roadmap done next year. Well, it’s really hard to hire 40 engineers in one quarter that are top notch. Like it’s that’s a hard thing to do. or, you know, I’ll just hire all these sales reps and we’ll just add more revenue. But like what ends up happening is

Well, your top performers need to train the new people. So they are actually less productive. And if you don’t hire good people, like it can suck productivity out for a little while. And so we always try to advise companies to be really thoughtful. normally people have more ambitious hiring plans than they can actually achieve. And I love when I go to a board meeting. Actually, we had just had our first board meeting of a new investment, and they said, and they were upset at themselves. They said, we’re behind on hiring. And I said, That’s great.

Because you’re hiring A players. Like, I don’t want you to just hire for the sake of h you we said we’re gonna hire sales twelve sales reps. And they said, Well, we couldn’t find twelve that were good, so we’re behind. I’m like, that’s fine. That’s fine. We’ll use the cash for the next A player coming down this pike. So, those are some things that I’ve observed from like the board level that I’m some of this is are things I’ve heard or ma I imagine is happening because I’m seeing the numbers and the output that’s that’s being driven by these, but

Yeah, there’s some human pain that can go on if people make that missed step too.

Bethany (38:15) Yeah.

Absolutely. I think being in our position we don’t always see the monetary impacts of hirings or anything like that. And I famously onboarding is very expensive even in large enterprises. So I’m sure especially for a startup where maybe or a a new company where things aren’t as in stone or there’s not necessarily processes for everything, it can even be more difficult. And that makes so much sense with the A players being

Melanie Nabar (38:25) Right.

Yeah.

Yeah. Absolutely.

Bethany (38:45) Than needing to serve as coaches and not eating into time and figuring out the the organizational structures from there.

Melanie Nabar (38:52) Yeah,

absolutely. And I think to your earlier question, Erica, on like how could you help push a project you want internally in at a big org, that’s a lot harder than at a small org. Like I’m I was answering that question thinking, you’ll just you just call up the CTO and you tell them this is a great idea. But that’s not always the case, right? and I think like really showing that you can monetize like this, these are the this is why from a business perspective and like back of the envelope, this is I think the impact.

I think that one is would be very good for people’s careers because you’re like thinking like you’re thinking like the people at the top are thinking. The top people at the top are just thinking about making sure they’re growing profitable and returning capital, right? they’re thinking about their, you know, outcomes at the end of the day. And if you can kind of take ownership like that at a different level, I think that’s really powerful. And at the end of the day, any time you’re spending in your career is an investment.

Like you are investing your time and effort at one company when you could be investing it at another. And so you are also an investor in the companies that you’re working at.

Erika (40:01) Yeah, I could definitely I can definitely or attest to that difference. My first job, my surface first software engineering job was at a startup and I would have lunch with all the people from sales. We were good friends. I now know, I don’t know, five people from sales and like don’t talk to them very often. So I could not tell you, you know, the the clear cus yeah, the revenue loss or anything like that. So yeah.

Melanie Nabar (40:15) Right.

Yeah.

Why they lost deals this past quarter, yeah.

Yeah. And

hopefully those conversations are happening like at at the level up. Like hopefully the CTO is talking with and they’re going through the reasons. And that’s that’s the trust is that that’s where your direction’s coming from is those things. But yeah, it’s definitely harder to get your hands on some of those things. I do think AI will make that easier. Like I think organizations are gonna have broader context layers that you’re gonna be able to

Erika (40:42) Yeah.

Melanie Nabar (40:55) Get information in a way that you weren’t able to before, you know? Like there’s no reason why you shouldn’t be able to pull information on like why we lost deals just from your instance of plod that’s connected into various systems, right? I don’t know that organizations are there yet, but I think that’s a hope.

Erika (41:06) Right.

Right. As long as it’s available.

Yeah.

Bethany (41:18) Yeah, I think that very much depends on organizations that are open by default versus closed by default. if some are hiding information or like just maybe not used to sharing it all out, then I can totally see that being harder for them to use or folks in other areas to use AI to get that. But a AI serves as such a great explainability layer for

Melanie Nabar (41:23) True. Yeah.

Yeah.

Yeah.

Bethany (41:42) as someone who’s not financial explaining what the finances mean and what in relation to to my role and and things like that. But it really it seems like the culture of the company really maps to that AI usage in general too.

Melanie Nabar (41:42) Right.

Yeah.

Yeah.

And then there’s the piece of like if you’re a public company, right? Like there’s just things you can’t you can’t have every person have access to your, you know, bookings month to date. in a public company. Obviously there’s restrictions for a reason ‘cause you’re in the company, but like there’s going to be pieces that like that and situations where it isn’t fully shareable. But I think there’ll be some opportunities too for

A lot of the organizations at my companies, the silos are coming down from like a functional area perspective because people are realizing like it it’s about building and like what does it take to build? Well, probably takes an engineer, product person, someone from customer success and someone from sales or marketing. And like all together, you could probably solve quite a few problems that that each of you are facing on a day to day situation.

Bethany (42:49) I I love that framing so much of of earlier on in the conversation you mentioned people are builders now. It’s not necessarily engineering versus product versus sales versus HR distinction. And everyone has that context that they can contribute to that really makes it interesting. That’s awesome.

Melanie Nabar (43:04) Yeah. Yeah, absolutely.

Bethany (43:10) Alright, well we are coming up to the end of our time, so I am very excited for this fun segment. so I I live vicariously through people who have it have pets because I do not have one. but I was scrolling your LinkedIn and I saw you posted a picture of your puppy with the caption for every new investment, startup, or big win, there’s a pup under a desk somewhere thinking I helped. so I happen to know Erica also has a

Melanie Nabar (43:21) Ha ha

Yeah.

Bethany (43:38) dogs. So I I would really love it if I could get introductions to to your pups, their their titles and maybe the company of your life and an OKR that they are crushing this quarter because we were talking about collecting data, you know?

Melanie Nabar (43:52) Yeah.

Yeah, absolutely. I wish I was working from home today or I would be able to introduce you live, but she’s at home. my pup is Lola. She’s a field golden retriever, and we got her during COVID, so she’s a little bit attached, as most of the COVID dogs are. but she is a an expert at the silent support. Like she will always sit on my feet.

I’m any video call that I’m on, if you see me in my home office, like she’s she’s on my feet. and so I would say that you know, s snuggles per day is she’s crushing it. It’s off the charts. absolutely. She’s our emotional support, you know, animal in the house for sure.

Bethany (44:39) good job Lola.

Melanie Nabar (44:39) Head of HR

perhaps would be her title, you know?

Bethany (44:43) I love that. Absolutely. are we getting a live demo from Erica? man.

Erika (44:50) This is here

he is. Jeffer is my my chaos agent. So he he’s really good at barking at any any sound that happens. So yeah, I I have to I have to always make sure I’m I’m able to handle that on any like video call. yeah, really, really good at

Melanie Nabar (44:58) C

Yeah. Maybe head of security. Head of

security is a important role.

Erika (45:18) Yes, there you go.

yeah, I’m just like never getting attached to to to speaking at any one time because I might have to be forced on mute. So he’s good at keeping me on my toe. Yes.

Melanie Nabar (45:28) Yeah. Hey that’s good. He makes sure you listen. Listening is important, right?

Bethany (45:33) It’s

so true. Protecting your work life balance too, he’s like, I got you. Ugh.

Erika (45:35) Yeah,

Melanie Nabar (45:37) Right. Yeah.

Erika (45:40) he’s also like constantly in here. so yeah, he’s he’s more of the support. My my other dog, she she’s just like an independent spirit, but she’s so sweet. So I think like when I’m having a hard day, like

Melanie Nabar (45:40) Absolutely.

Erika (45:57) She she like spends most days like outside or on the couch or just kinda like doing her own thing. But I can always find her and she always just like makes me happy. So yeah.

Melanie Nabar (46:01) Yeah.

Yeah. Dogs are so good at

that. They they’re just having the best day every day. So you remember like, okay, today is actually is a good day. You’re right. So

Erika (46:15) Yes, exactly. Exactly.

Bethany (46:18) Unless Jasper hears something, then it’s a serious, serious time. amazing. Thank you all so much for introducing Lola and Jasper. I I I needed that really. All right. well Melanie, thank you again for joining us. This was such a really cool conversation. where can folks find you?

Melanie Nabar (46:44) Yeah, you can find me on LinkedIn. I’m pretty good at being responsive there and or on Volition Capital as a website. My email is on that as well. So feel free to reach out there. And if you want to follow me, there’ll probably be some more puppy content on LinkedIn coming.

Bethany (47:01) man, okay. That’s a that’s a pretty good sell, honestly. It it was a cute picture too, so I definitely recommend that. all right. Well thank you listeners so much for tuning into Overcommitted. If you like what you hear, please do follow, subscribe, or do whatever it is you like to do on the podcast app of your choice. Check us out on Blue Sky and share with your friends. Until next week, bye!