Blue Sky Venture Capital’s Elaine Stead is a ‘boomerang’. She laughingly explains that while she grew up in Adelaide, she soon fled the city of churches, for brighter horizons. Yet just like a boomerang, Stead has found her way home.
Speaking at Startup Grind she explains how a girl from the “disadvantaged side of town” found her feet helping startups gain funding.
“I was the child of two migrants, which has shaped my worldview and is very critical to shaping my entrepreneurial path,” she explains.
Growing up, she says, she had a love for STEM (although she jests it wasn’t called STEM back then) and explains science is something she felt engaged with from the beginning.
“I truly loved it – I pursued STEM through high school and uni. I got roped into doing an honours degree and PhD – and when I got out I thought it would be pretty useless but now I’m super glad I did it. My PhD is the most challenging thing I ever committed to. And I think it set me up for entrepreneurship. Writing your PhD is essentially like developing an entrepreneurial project.”
Despite her love of science, Stead finished her PhD with the realisation that she didn’t want to be a research scientist.
“I tried to find alternative careers where I could still use what I had learnt from my PhD, but there really wasn’t much around. I wanted to find something that would allow me to have an analytically strong role. So that what I was aligned to and what I was doing would not be such a broad jump.”
Unfortunately, these positions were scarce and Stead soon found herself working in retail. Several months down the track she recalls being out drunk at a pub one night when her lucky break arrived. The sister of her former PHD supervisor spotted her drowning her sorrows and approached her.
“She asked what I was doing and I said I was working in retail. She told me ‘we’re looking for someone to work in the Uni commercialisation arm’.”
The pair struck up a conversation about Stead taking on the role.
“I thought wow that would be great. And it was. It was like my apprenticeship in taking innovation to market.”
Whilst working at the UnI, Stead got to explore innovation across a number of sectors including defence tech and healthcare before eventually spinning out a company through the University of Adelaide and eventually moving on to work for several VC funds. Today she heads up Venture Capital at Blue Sky where she has been instrumental in investing in a number of successful startups.
Asked what she looks for, before taking the plunge to invest, Stead has some simple criteria:
“We are really just looking for people who are emotionally resilient, “ she says.
“It is quite an emotional path – you need to have an ability to step outside yourself to have introspection and be objective as you move through the changing landscape of building startup.
“We also look for chemistry between founders. In the end, we are there to be the supporters and cheerleader or to be the ear on the other end of the line. So we need to be a good fit.
In certain circles, there is often the perception that Venture Capitalists can add negative value to a startup and Stead agrees sometimes VCs deserve a bad rap.
“Where we see Venture Capitalists adding a negative value is when there is a desire from the VC to control what is going on. Not from a shareholder standpoint but micro-managing or forcing a particular path which can be value destroying,” she explains.
She says at Blue Sky “we always have to check ourselves to ensure we aren’t trying to impose our views and that we have a genuine insight.”
She says what sets Blue Sky apart from many Venture Capitalists is their values.
“We try to take a more human approach to partnering with our founders. We’ve been with founders that have had very tumultuous times, from marriage breakups to founder splits – we try to be conciliatory of our founders and non-judgemental and empathetic, we found it’s the best way.”
The author was a guest at Startup Grind