Sydney Thomas, Founding Partner Symphonic Capital
Sydney Thomas is Founding General Partner Symphonic Capital – a venture capital firm that invests in companies making life better for the 99%. The launch of her fund was recently covered by TechCrunch. She has focused on this thesis for the past decade and has created a distributed network invested in this space by founding a podcast where she profiles these companies, launching a newsletter where she writes about these companies, and hosting events where she organizes people who care deeply about the impact these companies can have on our society. Sydney is a proven fund builder and investor. She joined one of Silicon Valley’s first Pre-Seed funds and scaled it from a Solo Operating GP with 10 investments to a 3-person team with 400+ investments and $200M+ in AUM. Sydney graduated from Berkeley with her MBA and Duke with her BA.
Shruti Shah, Partner Symphonic Capital
Shruti Shah Partner Symphonic Capital, a pre-seed investment fund for early stage startups. Previously, she was an entrepreneur in residence at Nike and advisor, investor, and consultant to a handful of startups. She also worked as Entrepreneur in Residence at Silicon Valley Bank, where she supported the early stage practice team on strategic partnerships and coached a handful of entrepreneurs. She was previously the co-founder and COO of Y Combinator backed Move Loot, an online full-service marketplace for buying and selling used furniture, where she led national expansion and general business operations. Over the course of three years, she and her co-founding team raised $22 million dollars to scale the business across the United States. Move Loot was featured in numerous publications including Forbes, TechCrunch, Bloomberg Business Week, CNN, TIME, Fortune and more. Shruti was honored by Forbes as a 2016 30 Under 30 recipient in Retail and E-Commerce and the Aspen Institute as an Aspen Ideas Festival Scholar in reimagining capitalism. Shruti earned her Bachelor of Arts degree in Political Science with a minor in Entrepreneurship from the University of North Carolina at Chapel Hill, and she earned her Master of Science in Education with a focus on Urban Education from Johns Hopkins University.
PreSeed model and Investment Focus
Sydney: We’re excited to share more about what we’re building at Symphonic. We’re an early stage venture capital firm investing in companies that are closing access gaps around health and wealth for overlooked communities. We just had our final close earlier this year, which you might’ve seen in Fortune. We’re very excited about the successful close and official launch of the fund We are generally investing in companies that are raising about $1M to $3 million dollar rounds at a sub $10 million dollars valuation. And some folks might be wondering, do those even exist? And then we have to share that they do, and it just requires a little extra searching. We are purposefully outside of the SF Bay area located in New York, in order to be really excited about founders that are proximate to the problems that they’re solving. In order to be able to support the 99%, we believe that you need to be in or among that community, not pontificating from the top on high on what folks might need. And so that’s where we focus. And in order to be able to support those founders, well, we have to, you know, drink and eat our own medicine, which also means being in those places! And luckily I think, you know, these are places that both myself and Shruti are very happy to call home.
Shruti: Well, Sydney and I make decisions together with regard to the kind of companies that we invest in. But I think for us both, this thesis – our thesis is very personal. We both really care about access. And I think that is probably the line that runs through all of our investments, whether it’s access to capital on the fintech side or access to care. I think also just like wealth building and wealth creation. And so, I would say, those are things that are personally very important to me. I was not born in the United States. I was adopted into a family that is also a family of immigrants and I think I understand pretty deeply how circumstances can shape the luck that we have. And so I have always cared very deeply about how we create more access to opportunity for other people and and also ensure that people have what they need to live healthy and vibrant lives.
Focus on PreSeed and What that Means
Sydney: The thesis that we have on pre-seed is that it has bifurcated. If you ask multiple different pre-seed investors what pre-seed means, you will get multiple different answers. There’s folks who are excited about investing in that engineer at Google who has this brilliant idea, but hasn’t even incorporated the company yet and give them 500K to quit their job and start the company and describe that as pre-seed. And we are looking at companies that are not that! They generally have launched, have some traction, have built something, but are looking for that first check because maybe they’ve bootstrapped today or they have not been really convinced yet that what they’re building has venture scale. And so we are investing in companies that we think are actually a pre-seed, but quite de-risked compared to the idea stage company. So I think it gives us a lot of excitement to work with founders also who are all in on the problem that they’re solving and have also, demonstrated their commitment to that problem by really building and working on it for some time before we get involved.
Shruti: I don’t want to repeat too much what Sydney has already shared, but for us, I think we feel like we can have the most impact in really helping and supporting our founders at the stage, where they’ve been able to put something out into the world and and get a few customers. And then I think our secret sauce is really in saying, okay, so now you have these initial customers, how do we help you scale this? And some of that I think comes from my background as a founder, having built a venture-backed startup previously and also wanting to to give our founders some structure. We work very closely with them. We develop some shared KPIs that they track on a quarterly basis. And we take the time to really dive deep into the kind of nuances of the business and and help them think through a plan that makes sense for them to keep growing and ultimately, ideally get to profitability as quickly as possible.
Getting Involved with Founders and their Startups, (not just throwing money at a startup!)
Sydney: Something that we’re starting to see more frequently is specifically around this seed strapping thesis. And so Shruti’s been, as she was mentioning before, counseling founders since we launched Symphonic around how to actually build companies in a way that gives them the most. It puts them in in a position where they have the most control of what they want to build. And it’s been pretty cool to see it start to catch on and to see this narrative of seed strapping become somewhat normal in the Valley. And when we were first launching it, I was talking about this stuff, folks were asking just what are you talking about? This sounds so crazy. I can’t believe that it worked. Why wouldn’t that company, if they’re successful, want to raise hundreds of millions of dollars? And then, you know, after what we all witnessed in 2020 and 2021, the aftermath of that in 2022 and 2023, which we’re literally just now getting out of, which is creating still a lot of companies having to do down rounds for their IPOs because they had ridiculous valuation and raised maybe even too much money? We’re starting to see founders realize that there is actually some wisdom in just taking what you need and leaving and growing and scaling, really intentionally and thoughtfully.
Some companies now are not aiming for an IPO: how does that affect the Venture environment?
Shruti: What it means for fund managers is that we have to think a bit more strategically about what it means for us to get liquidity. Our thesis is we are not necessarily looking for an IPO as we are a small fund. We don’t need you to become Uber, but we know that there are going to be many companies that are successful and that have very strong exits, maybe in the hundreds of millions of dollars instead of the billions of dollars. And so we have modeled our fund after that kind of thesis. and And even within that, we have thought pretty strategically around, we want to be with our founders for the long run. But if there’s a world where liquidity is off the table in the form of an IPO, or the acquisition looks like it could be a long, long time coming, how do we also get liquidity for our LPs? There are ways to do that, right? You can sell shares on the secondary market. There might be other opportunities for strategic investors to come in. We want to be really thoughtful both about knowing what we are good at, which I think is really getting our companies to scale. Then also knowing when is our time to graciously exit and allow other people, who are maybe more skilled later stage investors to support? In addition to that I think the flip side of it is that the market for tech IPOs has really changed dramatically! Largely because I’m not sure how many cycle? How many successful IPOs we truly saw in the last tech cycle? And so what I think that means for companies is that we try to instill very early, which is just build a good business! You need to have strong unit economics. You don’t need to raise crazy amounts of venture funding! I mean, part of Stripe’s problem is that they’ve raised so much money that they really have to feel confident about how they’re going to be valued on the public market. And that’s very hard as we’ve seen a ton of tech businesses take large haircuts from their initial IPO price. And so I think at the end of the day, we are very strong supporters and proponents of just build a good business with good unit economics. And the rest will take care of itself!
Sydney: I say often that we are back to a basic thesis. I think there was something along the road, where folks got really distracted by the number of zeros that came on checks, that they were both writing and and receiving. They kind of lost the plot. And so a lot of our ethos is around, let’s get back to those basics, it can be that simple!
Insights & Advice for Founders
Sydney: I think one of the things to be really intentional about for founders, when you are going out to raise that first round is to think really critically about who the partners are that you want to have around the table. Those initial investors are setting you up for success! The best ones are! And so how are you being really intentional about not just getting the capital, but also who the right folks are that you you need to succeed?
Shruti: One thing that I have been reflecting on a lot lately is, just how much the cost of testing things and building stuff has come down! I was actually talking with one of our founders today who I recently shared a bunch of links to vibe coding platforms. She showed me this really amazing internal database she’s now built with Lovable. And so one of the things I would just really encourage founders to do is investigate AI. I don’t think that AI is currently in a place where it is foolproof, but what are the tools you can use to help your team become more efficient and make your business more efficient? I think there’s so many, there’s such a huge opportunity with AI. So learning how to vibe code, leveraging tools like ChatGPT or other AI tools, not just from the perspective of your actual product. But just what are the operational processes inside your organization that could become more efficient, if you and your team are leveraging some of the tools that are out there?
