LOOPED IN with Carl Warkentin
The podcast about understanding, building and managing circular business models - this is the place where we dive deep into the future of business, sustainability, and circular economy. After a decade of entrepreneurial experience as a founder and investor, Carl had countless, meaningful behind-the-scenes conversations about how we can reshape industries, close the loop, and create real impact. And now, we want to bring these conversations to you.
On Looped In, Carl sits down with entrepreneurs, business owners, venture capitalists, and policymakers who are at the forefront of change. Together, we’ll explore innovative business models, breakthrough technologies, and the regulations shaping the circular economy.
LOOPED IN with Carl Warkentin
War Over Resources: Building Local, Circular Supply Chains with Lisa Morales-Hellebo from REFASHIOND Ventures
Lisa Morales-Hellebo takes us on a captivating journey from her DIY beginnings in the Bronx to becoming a pioneering force in reshaping global supply chains. Her story reveals how necessity and curiosity led her through roles in design, tech startups, and eventually to founding Refashion Ventures – a fund uniquely positioned to transform how we think about manufacturing and materials.
After experiencing firsthand the challenges of being a Latina woman raising capital in the male-dominated tech world, Lisa chose a different path. Rather than following traditional venture capital models, she built a community-first approach that now connects over 5,000 members across 148 countries. This network became the foundation for a distinctive investment strategy focused on localization, circularity, and distributed manufacturing.
What sets Lisa's approach apart is her hands-on involvement with portfolio companies. She shares a remarkable example of helping Mothership Materials – a company that can extract valuable biomolecules from waste – pivot from beauty ingredients to becoming "the unlock for the bioeconomy." By reframing their story and connecting them directly with major corporations, she helped generate a $100 million pipeline in just weeks, demonstrating how venture capital can create value beyond simply writing checks.
The conversation explores why national security concerns and resource constraints may ultimately drive supply chain transformation more effectively than sustainability goals alone. As global competition for raw materials intensifies, technologies that can extract value from waste streams or create bio-based alternatives to petroleum products become strategically essential, not just environmentally desirable.
For entrepreneurs working in industrial transformation, Lisa offers invaluable guidance: deeply understand your customers' challenges, embrace the messiness of working with small businesses, and design technologies that feel like "magic" rather than homework. The future belongs not to those building one-size-fits-all AI solutions, but to those who can build trust with the businesses that collectively drive 70% of our economy.
Curious about transforming supply chains or the future of materials? Book office hours through Refashion Ventures' website and tap into Lisa's wealth of knowledge and connections.
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Thanks for listening and keep podcasting!
Welcome to Lubdin, the number one podcast about circular economy and regenerative business models. We bring behind the scenes conversations with investors, founders and corporate leaders into the spotlight, exploring how to scale impact, build profitable business models and redesign our economy for a better future. So let's get started with today's guest our economy for a better future. So let's get started with today's guest, Lisa.
Speaker 2:It's so good to have you on another episode of Looped In and thank you so much for being here today. Thank you so much for the invite. I can't wait to jump into my favorite topic.
Speaker 1:Exactly me too, and I'm so excited that we can speak today, because after we talked the last time, I realized how many things we have in common and how many things we are both trying to tackle, sometimes in a similar way and sometimes in a different way. And in any ways, it's very inspiring for me and I'm just excited for yet another conversation just about this topic. It's really non-scripted, so let's dive right in and, uh, maybe tell us a little bit about who you are and, uh, what has been your journey to what you do today?
Speaker 2:yeah, yeah. Well, I'm just a Puerto Rican girl from the Bronx who has been obsessed with how things are made since as far back as I can remember, because I had to make everything that we wanted to have Dolls, barbie clothes, hour clothes, you know, pillows, cabbage patch, dolls. I learned to sew everything and because we didn't have money to buy things in the store. And so, yeah, that little girl grew up to want to do something creative that made money. I knew I didn't want to be a fashion designer because that seemed too risky and I already knew what it was like to not have enough means. So I told my parents the only school I was applying to was Carnegie Mellon, much to their surprise what we can't afford this. So luckily I got in on scholarships and grants and graduated with honors and used that to really focus my career, initially on design, and design thinking applied to brands and marketing, and quickly I realized that my passion was more about obsessive curiosity and learning. And when I first got to create a brand that impacted, you know, a global market, I was like, ooh, that's cool. I learned about print design and and how you make printed things and letterpress, and then the actual offset and then digital printing, and that was a whole cool thing to see, from my brain to the computer, to this machine, to the world. And then the internet came along, the web, and I was a kid in the candy store. I was able to ideate something minutes later, have it come through my fingers into the computer, upload. Well, back then FTP the files up to the server and get it out to the world and have instant feedback. And that was just intoxicating, especially because I was like two years out of school and I was impacting huge brands like Easy Bake, oven, mr Potato Head Monopoly, and then this little startup that I helped scale from infancy to pre IPO and today, well, it was acquired by Novell.
Speaker 2:That became obsessive. I just became obsessed with learning and all these new tools that were emerging that would enable me to build things in new ways. So my career of course took me to keep on chasing the latest thing. I learned how to develop schemas and taxonomies while working at a content management software company and during the first dot-com boom I was employee number 15, helped scale it to about 150 and exit in a year. And then I went out to the Valley peak boom right before the bust. I'm great at timing and somehow lucked into working at a company that was spun out of Procter Gamble and funded by Redpoint Ventures to see if we could pioneer mass customization, personalization and on-demand, one-on-one micromanufacturing. That was reflectcom and we were doing those things across cosmetics, skincare, hair care and fine fragrance in 1999, 2000.
Speaker 2:And I was a kid in a candy store and, of course, being entrepreneurial and curious and always asking why, I buttered my nose into everyone else's department and soccer within companies like P&G. That isn't the P&G way. But I got results. So within about a month I quadrupled revenue and the CEO said do whatever Lisa says At age 27, I was presenting to the board, including AG Lathley, and just having the time of my life.
Speaker 2:So I think, having my hand shaken by AG Lackley after presenting to him and the board at 27, I still I hope isn't when I peaked. But to have that happen early on, it really was a defining moment to say this is what you're meant to do, you are meant to live way in the future and create things that have never existed before. And that has become my obsession that I've brought to everything I've tackled throughout my career and I just keep following my curiosity, which has led me to let's see many years later building my own tech startup. When I was almost 40 in DC, I was obsessed with a site called Polyvore. I don't know if you remember that site.
Speaker 1:No, I don't.
Speaker 2:It was the first site to allow you to do online collaging. You could pull images from any website, cut out the backgrounds and then layer things and create a beautiful collage that was shoppable. And this was back in like I want to say, 2007. They launched so I was sitting here going, oh my God, that's the future of search, Putting disparate items into a meaningful context and then allowing the user to modify that context by applying filters of price or color. And I was learning their preferences. They're going to do that right. They never did that.
Speaker 2:So I did that and I pulled in all of their looks, threw away the lipsticks and kittens and Eiffel towers that people would inherently put in to make it pretty. I was like this is about merchandising. So I just took the dress, the bag, the shoes and two accessories and had my own search engine where you can search by outfits and see the look total as your search results under the beautiful photo collage of the outfit, and then you click on it, see it larger and you could see all the individual links, brands, price points down the side, a big, beautiful image of the outfit laid out, and then just apply price or color filters and you could lock in the things that were perfect, as is. So our search result would then call through 32 trillion possible permutations per five item grouping serving up the top 30 photo collage search results, with now your new permutations and variables and the new look totals under these new photo collage search results in two seconds, and I got into Techstars. With this.
Speaker 2:I thought, oh my God, I built the next evolution of search in my basement with, like my babies, and but at Techstars I learned that VCs are only investing in things that they truly care about and understand, and they clearly didn't care about or understand this space. And I thought but search is so hot right. All they saw was fashion and, unfortunately, before they even got to see my tech, all they saw was me, and it changed the whole way they would approach a meeting. I'd walk into the room sometimes. The first time I went to pitch a room full of angels, one of them stood up and said what is it? Bring your daughter to work day. Maybe next time I'll bring in my little girls. They'll share some of their ideas.
Speaker 1:I hope this is totally unimaginable today not really.
Speaker 2:I mean, it's evolved some, and at least they know it's wrong now. But yeah, it was mind blowing. I'm like wait, I'm a grown woman and you're talking to me like that.
Speaker 1:Wow, that's devastating.
Speaker 2:So you know, just being discounted before I even got to open my mouth really pissed me off and repeatedly I thought well, going into Techstars, I'll meet with the top investors in the world. Surely they want to invest in real game-changing, emerging technologies. Nope, all the same. Oh, sweetheart, you're so pretty. You should have just married better, like that, tory Burch, or we're going to have to talk to your CTO to understand your tech. You're the style lady, right? I'm like? No, I architected it. I wrote everywhere to the patent, I did all the user experience. I got the former VP of engineering at askcom, the original semantic search engine, to resign to help me build my private beta. Like what do you want to know? But they didn't really care. Repeatedly they told me to change my business to something like Nasty Gal, because she was hot at the time and I too could become a celebrity female founder. No, thank you. Is that all that? We're allowed to be in this space? Again got me pissed off. So I ended up shutting down that company to keep my IP. Rather than working at a company I hated turning into this celebrity talking about style once a week. I'm like I'm not your girl, that's not my thing. So the day after I pulled the plug, I got a call from Asus in the UK the head of global innovation, who I didn't know was following me and she reached out to say what happened. We've been following you, you made reached out to say what happened. We've been following you. You made something we need We've never seen before. I was like I know right, it's so good, we're fully dissolved. Kill me now. So, instead of going into founder depression, I decided to build the first fashion tech accelerator because I thought, you know, in every crisis, there's an opportunity and your energy is finite. What you focus on is what you attract, and I wanted to focus on something positive. So I built the New York Fashion Tech Lab from the ground up in three months, 2014,. It was the most successful and best funded program that Springboard Enterprises, my fiscal sponsor, had ever been affiliated with. We had more applicants in just two weeks from my personal outreach and we had more media coverage. And it's still running 10 years later.
Speaker 2:But what I learned the hard way? I thought you're welcome industry. I solved it. Mic drop, where's my ticker tape? Parade Right? No, unfortunately, getting the C-suite of Macy's.
Speaker 2:J Proulx, kate Spade, ralph Lauren, lian Fung, gbd, lvmh, marc Jacobs, altsamani and Ann Taylor their CIO, coo, cto and, in some cases, ceo to physically be present. Throughout my cohort I learned the hard way that they're not remotely incentivized or empowered to make any hard decisions and they were still investing in shiny objects just to get press mentions, to get their bonus, and then they bounce every two to three years. It's like, oh my God, if they're not going to fix it, who is? So I left after the first cohort to figure to study the apparel supply chain, to see where the bigger opportunity was, and so it was hard to leave my baby, but I realized it was performative. And so I studied the apparel supply chain on my own dime for a year here in the US, because I wasn't loaded loaded, and I learned all kinds of things about the current process that I applied back to what I had done 20 years prior at that time in the Valley for P&G, and thought if we were doing that in 1999, with billions of permutations of formulations, flavors, textures, colors, packaging on demand, post-purchase, how hard could fabric, needle and thread be right? It's not that easy, but it's not rocket surgery. So I applied design thinking and realized that the best possible path we have to solving for overproduction, human consumption patterns and the ticking time bomb that is our planet is to focus everything we have on localization and distributed collaborative value chains, starting with constraints, and that our infinite optionality and need for nowness drop ship directly to our mouths wherever we happen to be on the planet in first worlds, is killing the planet for everyone. And that if we rethought systems, if we were to refashion them from the bottom up, we actually have a better chance than to try to retrofit this now globalized, billion, noted, intentionally opaque beast that is our global value chain.
Speaker 2:And so I set about coming up with a deck because I'm a visual thinker and shared it with the C-suite that I now had contacts with, and they were like, oh, this is amazing, this is absolutely what's needed, but we're never going to adopt it. I was like why? Because we don't collaborate. Okay, well, I guess I'm not going to ask you to do that then. I mean, blockbuster didn't ask Netflix to come along and make them irrelevant. I'll just go that path. So I realized in that moment I could either be another Latina woman with her handout trying to raise capital for a space that VCs just didn't understand, didn't care about and weren't deploying capital in, or I could try my damnedest to be on the other side of the table and build my own fund. And so that's how I got Refashion Ventures.
Speaker 2:I met my partner at that exact moment when I was having that realization. A mutual friend said you know who else cares about supply chains as much as you do? You two should talk to each other, because we're all sick of hearing you talk about supply chains. I'm like what? It's the most exciting thing in the world? Well, not to everyone else.
Speaker 2:So Brian and I met over coffee in New York and within 30 minutes of sharing my life story, I told him I wanted to build a fund specifically at that time, a fashion supply chain vertical in an existing fund. And he said that's the stupidest idea I think I've ever heard. And I said, screw you why? And he said because I think you're probably the smartest person I've heard talking about supply chains and I've been writing global white papers on them for a while. Now You're going to need your own fund. Oh well, I don't come from money. How does that work? I literally had no clue. So I said Okay, can you help me? He was out of fund. He had, you know years in finance and so we became instant BFF. And in 2019, he decided to leave his fund and help me build Refashion Mentors. As his fund was actually flowing back the funds into the family office, so it was perfect timing for everyone.
Speaker 1:Your journey is very impressive and there are so many things that I love talking with you about and that you touched upon already, starting with localization and disruption, but also collaboration and building ecosystems, because this resonates with me so much, because I am doing all of these things as well, but I think slightly differently.
Speaker 1:Right, and to give a little bit of more context, I try to change things by building companies. Now I am doing a lot of board work, advisory work, and one of the companies we were talking about is Rodinia Generation, like an onshore, on-demand production company, and so I try to influence the entire value chain by somehow building companies, investing in companies, advising companies, and, next to that, I non-profit initiative that basically builds multi-stakeholder projects again more like a, an ecosystem approach. And you decided and that thought had crossed my mind several times you have decided to build a fund and invest in this ecosystem or in new ecosystems and enabling ecosystems, bringing people together, and I think I've never come across someone who does it to that extent as you do. So please take us a little bit through the uniqueness of your fund and how actually you and how actually you, I believe, have a bigger impact on the companies that you invest in than a typical VC fund does.
Speaker 2:Well, I appreciate that, yes. Well, when I met Brian and I said, ok, if I'm going to build a fund, I love doing hard things. Give me something impossible. That's my happy place. And so, ok, if we're already going to do this really hard thing, why try to replicate the model that everyone else is doing? Because that, first of all, doesn't apply to me. The guy from Harvard that you know was born into money and asked his friends for trust fund checks and has a $50 million fund won in three months is not my path. Has a $50 million fund run in three months is not my path. So if it's going to be hard, I'm going to do it my own way.
Speaker 2:And I said what I've learned working in Silicon Valley tech, boston tech, dc tech, puerto Rico tech, new York tech, living in Norway for three years is that you need community. Community first, and, having been through Techstars, I mean community is everything, but then, when you're focused on supply chain and industrial transformation, it is literally everything. People don't realize that if you want to refashion value chains, the first thing you start with is relationships and trust. Without those, there's no business being done. And I think that's an amazing thing, because it's a space that inherently has a moat against most Silicon Valley thinking. There is no easy path to just build and grow your way into this space with tech and win, because you need to start with relationships and trust. And I think the other thing I realized is that the world's focus on enterprise is upside down, specifically in supply chain, because 70% of the world's GDP runs on small businesses, and so if you need trust and small businesses, you need to start with community. So Brian and I started with community in 2017.
Speaker 2:We started with one event, the New York supply chain meetup, in November, and we thought 30 other people would show up to hang out with us to talk supply chain nerd stuff, and it was 150 people standing room only and we literally had the building turning off the lights on us at the end of the night like go home, we're being kicked out, and we thought that must be a fluke, right? No? Next month, same and more and more and more. And after that very first event, brian had people reach out to him from around the world through Twitter saying oh my God, we heard about this amazing event you're hosting in New York. How can we tap into that community from wherever they were in the world Bangalore, bogota, thailand, like what you know about what we're doing in New York, we had one event. So we realized that this could turn into something larger and we launched the Worldwide Supply Chain Federation, which really is just a grassroots network of community-led meetups in regions all around the globe and that now has grown to over 5,000 members and over 45,000 first-degree connections of top builders and buyers of industrial transformation and supply chain technologies around the world and that gives us inbound deal flow now for our fund from about 148 countries. So community, community, community.
Speaker 2:And I remember our first year. We had Lian Fong and Marist and all these huge companies attending and working with us on events and they said we've tried to put significant money behind trying to build community. And you've done this and have bigger events with zero dollars. What's your secret sauce? We're like I don't know. Let's go ask our community.
Speaker 2:So they said Lisa, it's you and Brian, it's your obsessive enthusiasm about this topic, your expertise on it, your ability to curate the right people to have in the room. It's interdisciplinary, so it doesn't exclude anyone, it includes everyone and that creates cross-pollination of ideas. And for an event in tech first of all to be 50-50 female-male is like whoa what. And then to also have them be inherently diverse at every single event, like you guys have no agenda, you're not trying to sell us anything, you're just truly trying to curate the best content and the best people to be in the room to help the best ideas gain a catalyzation and adoption and scale, and that in and of itself is powerful enough to make us all want to show up. I was like, huh, okay, that's awesome.
Speaker 2:So community first and then the fund.
Speaker 2:I had some big ideas of having our fund one be like $250 million because we could easily deploy that in a space nobody else was literally funding way back in the day, but was slapped in the face with reality when Brian was like we need a slower roll.
Speaker 2:Like fund ones are usually teeny tiny. We need a slower roll. Like fund ones are usually teeny tiny. What so? Most people don't realize that some of the biggest funds in the world started with a fund one of like a million dollars, three million dollars, five million dollars, and then it wasn't until fund two, three or four that it was even like 50, 75 million. Just recently. These huge funds have blown up, but that is the exception, not the rule as if you go back in venture capital history. So, starting out, brian is 6'4" darkest Nigerian man and I'm a Puerto Rican woman and we would again walk into a room to talk to LPs and the first time we had an LP say to our face word on the street is there's too much team risk, because just look at the two of you.
Speaker 1:Wow.
Speaker 2:I'm sorry what.
Speaker 1:Exactly, wow yeah.
Speaker 2:I realized we were up against again things that were not about our value or what we're actually selling. We were being judged by this, and so our path had to be different. And we went and we've participated in probably all of these VC accelerators that exist here in the States now, and we realized in all of them they said don't do a rolling fund, it's going to be too, you're not going to be taken seriously. You should just go for a $10 million fund one, something realistic, and, and you know, we'll help you get there. Well, we saw all the other people in our cohort that didn't look like us getting their $10 million fund ones, and that's when we said you know what, let's keep talking to AngelList. They've got this rolling fund thing and I told Brian, as an entrepreneur, momentum creates momentum.
Speaker 2:I don't like sitting around waiting for anyone to see my value and to allow me to pursue what I want to get done. So I think the quickest path is to do a rolling fund, which was a new vehicle that AngelList created with the SEC here in the United States, and every quarter is its own fund. Most importantly, we can publicly solicit, which I was like oh my God, talk about power constructs here in the US you can publicly solicit, which I was like oh my God, talk about power constructs here in the US. You can't even talk about raising a fund. How does that happen then? Oh wait, you need to be wealthy and at your country clubs, over your brandy snifter in the evening with your trust fund friends say, oh, would you like to participate in my round? If short of that, how are you supposed to raise a fund if you can't publicly talk about it?
Speaker 2:So Brian and I had community. I said we can publicly talk to them about what we're doing, and our first check came in from Ben Gordon, who was in our community. He is the head of Cambridge Capital, one of the largest private equity funds for logistics here in the US. Our second LP check came from Albert Wenger from Union Square Ventures. We have Daniel Stanton who's known as Mr Supply Chain literally wrote the book on supply chain for dummies. It's a who's who of industry and who has been in our community, believing in our expertise, ability to curate and select great content to talk about and to promote, and then believed in us.
Speaker 1:So every quarter is a new fund. How many funds in that sense do you have?
Speaker 2:Yeah, Can you tell me?
Speaker 1:how much asset management you already have.
Speaker 2:Yeah. So because we're publicly soliciting from any accredited investor and we wanted to make it easy for our network, we said, ok, what if the check size was 25K as the minimum to get into the fund? And because every quarter is a fund, to make sure they're diversified, we would require they have to invest over at least four quarters, so that would be six thousand two hundred and invest over at least four quarters, so that would be $6,250 a quarter for four quarters. That's pretty reasonable for a lot of high net worth individuals. So with that structure, we started deploying capital in 2021, september Our first check was cut and we now have 68 portfolio companies. And we now have 68 portfolio companies and a cadence of anywhere from three to eight deals a quarter. Yeah, so it's a fast clip. It means that.
Speaker 2:So AngelList is our back office. We do all of our own diligence, even though we are not leading any rounds with that sort of check. We do all of our own diligence. We write our own memo that goes into AngelList. They handle all of our back office, which makes everything so much more manageable for an emerging fund, especially if you're going to have a faster clip of investment. They've been an invaluable team member, as far as we're concerned, to be able to do what we're doing.
Speaker 2:And then momentum has created momentum. People have seen that the way we're investing across end-to-end supply chains intentionally from data and AI, advanced materials, advanced manufacturing, next-gen logistics we're thinking well. If we invest intentionally, we can piece them together to orchestrate and facilitate that future ready value chain that everyone's talking about and is wishing with hopes and dreams that it'll magically happen and save us. I said I don't believe in that. I believe in what I can do myself. And if we can get enough capital, we can deploy it intentionally. We can look for things that are complimentary, or one plus one equals 100. If we can get enough capital, we can deploy it intentionally. We can look for things that are complementary, or one plus one equals 100, if we invest properly and create this ultimate future ready value chain.
Speaker 2:So the third component we started with community, then capital deployment. The last one was catalyzation. So we need a separate, like consulting, operating company arm that exists to accelerate the integration and adoption and scale of our portfolio companies. And now that is Refashioned CoLab. I had started initially as a company called Refashioned OS operating system because I wanted to orchestrate the end-to-end supply chain specifically for apparel. A lot of things smacked me in the head when the administration changed here and all of the stuff and inroads we had got dead-ended so we ended up having to shut down that org but still pursuing it through different means, now with the CoLab.
Speaker 1:Can you share how much asset under management you have?
Speaker 2:oh, yeah, um, a little over three and a half million oh, wow.
Speaker 1:That's exciting, and what I think is really, I mean the true asset right that you bring is not necessarily the money for each investment, but rather your expertise, your network. How do you really bring in, like if, if you were investing in in me, you know, let's say, I have a supply chain company, something that might be interesting for your fund what value do you really bring? Because you share like, yeah, we we're gonna leverage. You can leverage our network and nothing happens. So so what do? You do differently.
Speaker 2:Yeah, I'll share very concrete examples. So recently in Q1, I think it was this year we invested in a company called Mothership Materials, and so I hold Friday office hours just because I don't believe that there should be a warm intro only as a way to get to a VC and so anyone can get onto my Calendly. There's 30 minute blocks on our website. You can book office hours on Fridays. So I happened to meet this female founder about 18 months prior. We met in the city. She shared with me her amazing concept. She had some unique IP to somehow magically use physics to extract bio ingredients at the molecular level from any bio waste. And she was doing this for to create clean beauty ingredients. And she wanted to raise I think it was $4 million at the time to build a factory to scale clean beauty ingredients production.
Speaker 2:I was like no, it's not. I think you've got it backwards. I think your market is too small and your factory is too big. What you're telling me you can do is literally the unlock I've been looking for for the bioeconomy literally the unlock I've been looking for for the bioeconomy. I haven't been investing in a ton of biomaterials, because there is a huge leap between going from a pile of cactus or banana peels or algae to valorized, stable quality, controlled, always on input ingredients. That's right and what you're doing could do that at scale. But you need to. You're the unlock for the bioeconomy and bigger markets. Smaller factories put that sucker into micro factories deployed on premises closest to where the waste is, and you disintermediate all the cost associated with the logistics. Now that is interesting.
Speaker 2:And she said, lisa, you blew my freaking mind. Nobody had ever given me that concept or feedback. I literally left and went frantically trying to figure it out. She came back after she had proven it and done all the tests and raised a little bit more money and was funded by SOSV and IndieBio, went through some good programs and she said, lisa, it scales so beautifully. And so she shared her latest deck and I said this is exactly what I told you to do. Bravo, yes, we're in Within a week of investing.
Speaker 2:We were reaching out to VCs on her behalf and we're getting a lot of really like high interest from huge funds. But the roadblock inevitably was they would have a junior associate doing their initial screening checking boxes on questions and they're like yeah, so this isn't proven, there's no paradigm to like. Who is this like and like? It's not like anyone, it's a first of its kind, innovation. Oh well, it has to be like something. No, no, it doesn't why. Or she would get to the partners and deep diligence and they just couldn't believe that the unit economics could be that good. Or they would literally also say things to her like so did you intentionally not have any men on your team?
Speaker 1:Why is your team all women?
Speaker 2:I thought that's what they were looking for. Well, I told her your answer to that should be well. I didn't want to lower my expectations and I only pursued the global experts in their area of domain expertise. They happen to be women, like what. So I was frustrated for her and she was literally getting defeated by talking to all these amazing funds that would hype her up and then do massive deep diligence and then pass or tell her even worse, tell her to change her model to something they understood. I'm like no, just stop talking to VCs. They are making you doubt your own brilliance and what you know. They don't know your business. So just stop talking to them. Let's just focus on getting you revenue. And I was like send me your sales deck. I'm the sales deck, oh, joe.
Speaker 2:So within a day and a half, she sent me some of her existing materials and I helped whip together a sales deck. I had inbound happened to have inbound that week from a contact who was a chief supply chain officer, a huge retail chain that was having an orange peel crisis and I said, oh, I think I have something for that. So we targeted the deck specifically around orange peels and how they can deploy right where the waste is. Apparently, orange peels require special logistics because of the level of acidity in the peels. So if you're trying to dispose of your orange peel trash, you have to pay a premium just to have it hauled away. And they were like help.
Speaker 2:And so we created this deck and I said let's prove to them that your CapEx can be paid back in a matter of hours because of what you can extract from orange peels. So we created this awesome deck. It shows that, even though a full microfactory, a shipping container with a 50,000 gallon per hour inflow of ingredients, you could extract pectin, cellulose, glucose, essential oils and vitamins. All of those have their own going rate prices on the global markets and pectin happens to have a global shortage. So with pectin alone, in a matter of 4.3 hours you could pay back a $700,000 CapEx investment.
Speaker 1:Wow.
Speaker 2:And sending that out, brian and I just started cold outreaching to all kinds of executives. Within three weeks we had helped her get inbound deals from some of the largest beverage companies, retailers and almost a $100 million pipeline.
Speaker 1:Wow. So your real value add is the network and your expertise that you really actively bring in and try to work with all of your portfolio companies.
Speaker 2:Yeah, and to help them tell the right story. I didn't realize that my background as a graphic designer and design thinking like just rolling up my sleeves and helping her better articulate the sales value prop. And helping her better articulate the sales value prop, she could talk about her technology and what she built, but that's not the story that the C-suite's gonna wanna hear. They're gonna wanna understand CapEx expenditure, roi, timeline to ROI. And do I have to lift a finger? No, you have a model where you can literally deploy it and just turn their trash into cash. And one of the companies that we connected her with said, within the first couple of weeks of doing some trials on brewer spread grain, that she could, in essence, almost double their revenue from their trash wow, wow, that's, that's impressive.
Speaker 1:So how do you see, because you're you're really focusing on localization of supply chains, which I believe should have a lot of tailwind right now, especially with the current administration. Actually, um, when it comes right like, and even in europe, we talk about supply chain resilience on the munich security conference, where global players from worldwide leaders are coming together and talk about that. So, as much as we have global supply chains, everybody seems to now focus on urban mining and localization. How much of a tailwind is that for you?
Speaker 2:It's finally starting to be a thing. The current administration had a lot of changes that happened early on that impacted all my existing relationships within government orgs. They all went poof and so I was devastated. But now there's new projects that we have been pulled into around regional tech hubs. So there are tech hubs all across the US that have gotten significant government funding to invest in critical infrastructure, critical materials, and we've been brought into those projects and programs Unbeknownst to us. Again, we've had people seeking us out and all roads apparently lead back to refashioned. If you're looking for a fund where you could literally piece together what's needed in any sort of value chain and these are universal we're not just fashion supply chain, we are, you know again, data and AI, advanced materials, advanced manufacturing, next-gen logistics, and so these tech hubs are realizing that we could deploy a good amount of our technologies to create all the things that the tech hubs have been charged with doing, like catalyzing advanced materials and localization of stable, always-on inputs for critical material production. There's distributed collaborative value chains and creating a control tower across the regional infrastructure.
Speaker 2:There's discovery being able to find all of these small businesses, because I was shocked when working with the US Census Bureau last year that, of the almost 300,000 factories in the US about almost 300,000 factories in the US about 268,000 of them are less than 100 employees and 70% of those are less than 50. And when you think of these small shops, they don't have websites, they barely have any digital footprint, but what they do have is IoT data. And so GraphIQ, one of our portfolio companies. We invested in them because they have created the world's largest database of knowledge around industrial supply chains, including companies that have no online presence. They do this through a number of different data sources and can piece together a 360 degree view of I don't know CNC machining shops and specialty part producers. And so even this company has government contracts, because to be able to have agility and localization, we need to start with like what do we have here? Again, start with constraints, what are the existing raw materials and assets we have to build from, and then we could create a strategy and plan. So bottom-up realization of everything that has existed here has been my focus, and people are realizing that our portfolio companies are their best shot to deliver against that, especially if they need to do it quickly.
Speaker 2:And the other insight I was shocked to learn when talking to some of these huge corporates that have reached out. I'm like well, you have Andreessen, you have all these funds that are now saying it's time to build and, given the climate where LPs have deployed almost 80% of all capital has gone into the top. I think it's seven funds over the past couple of years, so there's not a lot of money going around other than what those huge funds in the Valley have. And they are the ones now finally saying it's time to build physical things. Yay. The thing is they don't invest as early as we do, so their deals are already like 10 years old, which means they're investing in technologies that aren't in the primordial soup that exists today, building entirely new paradigms for tomorrow.
Speaker 1:So that's our secret sauce we live in that primordial soup I'm personally totally invested in urban mining and you know onshore production but all what urban mining means as well, right like from collection unlocking unlocking that supply collection, sorting, recycling, but also how we manufacture things, entreproduction and, as you know, Rodinia Generation, where I'm chairman of, is exactly those kind of things that are really interesting for me right now. Is that also what you see like one of the trends right now in the US?
Speaker 2:Absolutely. I think that we have to start seeing what we produce as an asset, and so we spend all this energy, time and human labor and cost to the planet to bring something into the world, and then it has its use and then we dispose of it, and that's just insane. So I think everyone's been focused on trying to appeal to better angels to do the right thing, and, frankly, what I've learned over 10 years of trying to understand how we can move the chess pieces to give a damn, whether it's consumers or corporates or governments even and what I've arrived at is, unfortunately we no longer to continue to invest in circular infrastructure and to turn our trash into assets for new world materials. Think of, you know, the Rosie the Riveter moment. We were collecting scrap metal during the war and having to turn it into new things. That's literally the same concept. And having to turn it into new things, that's literally the same concept.
Speaker 2:If, in a time of war, which all signs are pointing to, unfortunately, the world is heading in that direction, all of us need to understand what our local assets are and what we can create from those assets, and so I think one of the things that I got really excited about in realizing the power of particularly mothership materials that unlock alone she can tune the properties of these new raw material ingredients at the molecular level in ways that are mind-boggling. So if you need a polymer that is as strong as steel, that is bio-based, there's no cheaper, faster way to create it than using mothership, because it's only using physics no water, no heat, no chemistry to sort and separate things at the molecular level and then tuning them to the properties that you want. Separate things at the molecular level and then tuning them to the properties that you want, again at the molecular level. It's. It's the most efficient way to turn your trash into new assets. But it's currently just with bio waste, so you can't take a garment and put it through their machine. It has to be like orange peels or leaves or whatever. She can do, proteins as well, anything bio.
Speaker 2:But I think that humans are just too freaking lazy and the concept of consumption is too ingrained that we frankly have a better path of achieving circularity by doubling down on investing in bio-based, biodegradable ingredients and materials as an alternative to fully replace our current poly obsession. Now, the properties of poly and the cost is why everyone uses it. Now, if those properties can be embedded at the molecular level and you could create it as cheaply or cheaper than poly currently, and it's ubiquitous. The path to get there is through industrial, commercial, military applications, things that are always on volume scale to get enough volume. So the price comes down. Down then the laggards the fashion industry should finally adopt, because they'll have the ability to have all their cake and eat it too thank you so much for pointing this out so clearly.
Speaker 1:That is really beautiful and help. A lot of listeners really listen very actively to what you just said. Do you also feel that the key driver at the moment, unfortunately, is not sustainability, but rather security and safety?
Speaker 2:Yes, national security and safety, sustainable local economies. The realization that, um, I believe current global landscapes is like uh I, I told everyone before the election happened. I think the next administration, whoever is there, is going to be dealing with a game of of global um chess, where everyone is positioning, jockeying for raw materials and assets, because that is the new global landscape for warfare and national security. Everyone needs raw materials your rare earth, minerals to create more, more, more. Why do we need more, more, more? Oh, because we need AI, because we need generative AI to create cool videos of cats driving cars and whatnot.
Speaker 2:And then crypto, because our paper money is no longer convenient enough for people, and so we're going to lose that battle of the technocracy that has now taken over a global oligarchical power construct, you know, and rather than fighting against it, we need to really understand the landscape. We can't play the game that we wish we had. We need to play the game that's actually on the field, and the game that's on the field is a war over resources, and so everyone is realizing we need to protect our own. How do we do that, especially in a time of war? Good luck trying to get anything from China or anywhere, you need to look within your own confines or landlocked. Fortunately America, we have all of the Americas, a huge landmass. If we don't alienate our neighbors.
Speaker 1:Lisa, I could talk forever with you. It's exactly, I think, both of our topics. I think both of our topics. But my last question for you is what do you feel? What are the most exciting topics that are landing on your desk these days that you are dealing with for the future? And just before you answer, I also explained a couple of times on this podcast. This is supposed to be an interactive podcast and, and, as I mentioned before, we could talk for hours more, yes, so I invite all our listeners to you know, hand in some questions and further topics that they would like to address, and I'm happy to to make another meeting with you, uh, and as I am moving myself to the united states, uh, very soon, maybe we can do it even in person. But, yeah, like, tell us what is, what are the hottest topics right now to look at?
Speaker 2:yeah. So I think everyone can't ignore the the ai elephant in the room um, ai, ai, ai, um. But I think I AI. But I think Silicon Valley generally is. If you're not again intentionally living in the primordial soup, you're not seeing the forest for the trees. Ai in and of itself is not the value.
Speaker 2:I tell so many amazing companies that have built great agents or bots or whatever Like okay, so what? First of all, how have you engaged with the market you're trying to sell into? Oh, what do you mean? We're going to hire a salesperson? No, remember supply chains and industrial transformation starts with community and trust relationships. So, do you spend time in factories? Do you spend time with freight trucking companies at local meetups or even just popping into truck stops to hear real world trucker pains? Like that's how this next industrial revolution is going to happen, bottom up.
Speaker 2:There is no easy, painless way to build the next game changing AI tool. And if a company is has built something and they haven't put in the work to do that, it's really apparent to me and I tell them I'm sorry, it's not a fit. I don't care if you have, you know, revenue coming in off the wazoo, that most likely will be short lived and will reach the ends of your personal community. You need to have something larger, and you need the AI to not feel like homework, and you need the AI to not feel like homework. That's another thing. I think a lot of these companies are treating technology as the solution and not realizing that AI should feel like magic if it's being done properly. I shouldn't have to, you know, upload something, tell it how to tag the thing, and it needs to truly walk me through an experience that, as I like to call it, is Fisher Price here in the States. That's children's toys, so if you can bang it with your fist as a toddler, you did a good job and it should feel like magic, like I hit that button and magic happened. And so those are the things that I think companies that are building in AI need to really understand first, really live in the primordial soup with your customer and know that they're not in enterprise, they're in small businesses, and there is no hack at getting their trust other than spending the time. I personally have spent about 10 years hanging out in US factories, and so there's no shortcut to your 10,000 hours to become an expert, and there's definitely no shortcut to the trust and relationships.
Speaker 2:The other thing is, I think the opposite of what most VCs are looking at is materials. I think the bottom up. If you're going to refashion value chains, you need to go all the way back to the beginning, and you can't refashion advanced manufacturing without recognizing you need the inputs. And where are those inputs coming from? Whether they're waste streams or bio-based, you know sorted and separated ingredients.
Speaker 2:What is the most efficient way to make use of your local constraints? And then how do you really lean into what's possible within your region and know those boundaries and know that those boundaries are okay they're actually part of your moat boundaries and know that those boundaries are okay, they're actually part of your moat. Rather than trying to be everything to everyone, be what is relevant to your most needed customers in that market. And bottom up, I think is the future of everything and startups that are obsessed with their customers and that realize the secret to the future of all value chains is with messy small businesses that have kind of a disaster. When you look at their back office, it's not around them, it's with them. And if you can truly embrace that and learn how to partner with them, you're going to do really well in the future.
Speaker 1:Wow, lisa, thank you so much. Thank you so much for being here today and for sharing your path, and good luck on your journey.
Speaker 2:Thank you so much for having me. It's been a blast.