Solutions Driven

Why company structure is freeing when done right with Initialized Capital’s Kat Steinmetz

In the bustling start-up world, diversity, culture, and leadership play vital roles in building the foundation of a business.

So in the latest episode of The Hiring Enablement Podcast, we’re excited to have Kat Steinmetz, Partner at Initialized Capital to help us dive deep into culture and leadership in the start-up world.

With a diverse background in Human Resources, Talent Development, and now in the Venture Capital field, Kat brings valuable insights into the role that HR and leaders play in shaping a company from the ground up.

Tune in as Kat sits down with Solutions Driven’s Chief Growth Officer, Nicki Paterson, to talk about:  

  • The importance of embedding diversity in businesses as early as possible
  • Why structure is freeing when done right
  • The power of a compelling narrative backed with data 
  • Creating a sense of accountability through kindness and compassion
  • How awareness in leaders help shape a company’s culture
  • The similarity of hiring an executive and investing in a founder
  • Plus Kat’s advice to start-up leadership groups
  • And much much more!

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Nicki Paterson: Hi everyone, and welcome to episode 36 of the hiring enablement podcast. I’m your host, Nikki Patterson, Chief growth officer at solution driven and today I’m joined by Kat Steinmetz, principal on the investment team at initialized capital cut. Amazing to have you on the show. How are you?

Kat Steinmetz: I’m great. Thanks so much Niki, great to be here.

Nicki Paterson: Recently, Solution Driven, launched Hiring Enablement, Kat’s a super guest because she’s one of the most passionate people when it comes to enabling other people that I’ve ever met, so really excited to get into Kat’s background, Kat’s current role, the real areas where Kat supports not only people but businesses grow all across the world, Kat really looking forward to that. So let’s dive let’s dive right in. Kat, if you wouldn’t mind, give us a little bit of a background to current role and how you got there.

Kat Steinmetz: Sure, absolutely. So my whole background is in talent and culture in the HR world. So close to 20 years. I started out as a baby recruiter, when I first came to San Francisco, I like to say, in the, so many years ago, and then ended up at Burning Man. Yes, that’s that actual thing that you’re thinking of. And I kicked off and created their entire people function for them, they did not have that when I showed up. And I started going to Burning Man as a performer. I’m a longtime musician, and an artist and singer. And they needed an HR person, boy, did they ever. I started there as a consultant.

And I was also consulting for other very small startups, just helping them get their HR things kind of kicked off and helping them hire their first HR person. And then eventually, Burning Man became the global phenomenon that it is, and they needed to have a full time person and really create a whole function and help them become a nonprofit. So I did that. And it was there for 10 years, hired the organization and created

Nicki Paterson: Super rare that anyone stays anywhere for 10 years, right?

Kat Steinmetz: Yeah, and I think because I was consulting for a good chunk of it, I was able to do all these other things. It allowed me to kind of be a there for that long. Normally, I don’t stay that long, somewhere, I get kind of bored of something after a few years. So it obviously kept my attention because it needed a lot of work. And it needed a lot of nurturing to become the full fledged nonprofit that it is. It took a lot of work to get everything to that place, and really help Larry Harvey have his legacy before he passed on. So it was a happy to do that work. Forever a burner. They’re my family and my community.

From there, I went to Stitch Fix. So I was a very early employee at Stitch Fix. Number 140. They were a Series C company at the time that I started. And I just thought they were very cool to be a fashion and tech company was pretty nice. And they had a woman CEO and founder Katrina Lake, the youngest person and woman to ever IPO a company. So pretty amazing part of that whole entire journey from early to all the way to IPO. And then going global, I was part of the first people leadership team.

They’re really working very directly with Katrina and the management team to build out all their cultural assets, talent development, talent management, cultural engagement, employee engagement, all of those things. So that was an incredible journey, an incredible ride.

And when I kind of finished up there and felt like my work was done, I got recruited to Box, the very classic Silicon Valley company here, and help them kind of do the same thing. But they were already IPO already global, but didn’t really have any at the talent development programs.

Nicki Paterson: So much of the structure in place.

Kat Steinmetz: Exactly. So again, came in kind of was my own startup in the midst of that built the whole team, developed that team, created all of their talent development programs, all of their coaching programs. I was getting my own coaching certification at the time and wanted to really have this vision of coaching for everyone in some way or another. So was able to do that through COVID, which is it was a pretty wild ride to be home, build out the team and and do all of these programs, suddenly, virtually. We wrote a couple of white papers and published them actually about how to do onboarding really well virtually as well as coaching and talent development programs. So that was an incredible ride.

And then I got really out of the blue recruited to Initialized it was completely out of nowhere. I did not see myself becoming part of an early stage VC, but they are not just any VC, they’re quite different. I would say kind of the number one thing is the philosophy that they hire only former operators and founders as part of the investment team. So everyone has deep expertise as those things, and we really feel that that can help our founders and our companies become as successful as possible, because we understand how to do all the things they’re trying to do. And we’ve done them.

So that was my background, and I came in to really work on advising across all of the areas that I have a lot of expertise, which early stage companies need a lot of help in that area – hiring, building out people policies, and functions dealing with things that are hard with employee relations, and all of those things.

I focus as an investor around future work, and HR tech and wellness and well being and anything that kind of stems off the sort of work, employee experience of some kind, I’m called in for any pitch that has touches any of those things.

Nicki Paterson: Initialized Capital, I mean, hundreds of companies, tons of money involved, right? You get to see so many companies that are different. You get to see so many different types of companies touch loads of different companies, you get to see them go in there and be successful, make mistakes, and you can pass on those mistakes or successes to other companies as well. Did you ever see yourself 20 years ago, when you fell into recruitment or hiring where you are today?

Kat Steinmetz: No, definitely not. I don’t think in 20 years this even existed. I just was hurry to get the feeling with the .com. I don’t think anybody understood that whole world very well. But I certainly have touched on a lot of that, companies like Stitch Fix and Box. And they’re very much in that ecosystem. So it made a lot of sense to me. I am a low up people, tech partners advisor, that’s a group of sort of, although most modern heads of people that come together and advise around a growth program for people, tech products and founders. And so I’ve been doing that for a number of years. And so I get the idea of advising founders, I was a strategic advisory board advisor to a few different companies. And so I understood that ecosystem, and I understood what an early stage company needs, and I started dabbling in angel investing and looking at that kind of thing. And so it kind of made sense, but I was very wary about like the tech bro, kind of VC, bro kind of idea, right. And I didn’t want to be part of something like that.

But, again, I think that’s where Initilized really stands out, we’re one of the most, if not the most diverse group, in a way, in the VC world. So we have over 65% women on the investing team, as well as across the company, we have a lot of diversity and underrepresented groups in our team. And it’s just naturally how we hire and how we think. And that was very appealing to me. And when I hired our head of talent, Tiffany foo, who came on in November, very much with the idea of we want somebody who really understands the world, all of the networks of that, how to do that, it’s just second nature. Because when you work with an early early stage company, you want to instill that as early as possible, because as soon as they get that diversity in there, and that thinking it’s just stems the entire growth of the company.

Nicki Paterson
Before diving into, I guess, the the ice you’d already know, because loads to loads to get into, want to go back the way right. I mean, like we said, 10 years at Burning Man, very few people I know, even founders, owners on other companies for 10 years, right? I mean, if you could think of one moment at Burning Man, where you accomplished something amazing. What springs to mind?

Kat Steinmetz: Hmm. Yeah, I mean, I saw a lot in my years there, right? It becoming, like I said, from a very kind of underground artsy event to begin being literally this worldwide phenomenon, right, where everybody knew what it was, and everybody wanted to get a ticket, and it sold out within minutes. Such a different world from when I began, and when I left there, they needed everything. And they did not come from a place of we’re a business, right. Tthey were just a bunch of artists that came together to do this counterculture event.

So a lot of it was just getting them to be in the mindset of you’re a company and you need to be responsible around that right or the world and towards your employees. And so it was just helping them and it took a while, a lot of things were very like anti the man which is funny, right? But anti corporate, right anti being any of those things.

So it was really helping them in the leadership team, the six founders to see that structure is a freeing thing for people when done right Right, and then you can do your own way. And I think that’s one of the things I learned really heavily is when you get structure, right for humans, it’s very, very free. Too much. It’s rigid, right? And as micromanaging, will feel very stifled. Not enough. It’s chaotic. Nobody’s clear. They don’t know how to do things. They’re wasting time. So it’s this like razor’s edge of how do you do both of those things?

And so I think anything I did, I tried to do in the idea of bolstering that razor’s edge to be wider, so that we would have a more ability to be in that structure that was so freeing. So yeah, I think basic things, but things that weren’t there, like just really kick ass benefits, like compensation being correct, like roles being really clear so that people knew what they were doing and how to work together, organizational design, and making sure teams worked really well. Because the whole goal of Burning Man is to build community. And that’s a wonderful goal. And at the same time, it can go a little bit sideways with business sometimes.

I think you still have to be responsible towards the organization, even even even as a nonprofit, you absolutely do because you’re using other people’s money, and the way to build this community, right? So how can you do that in a way that’s going to help that thrive, not just survive?

Nicki Paterson: I think we hear that a lot. And again, I’m not gonna sit here and badmouth any other recruitment company. But there’s a lot of just through CVS hope things stick, like, Who do I know, what’s my network was my little black book. And that’s been a lot tougher for people over the last few years the hiring world really has changed.

The candidates have a huge voice, they have a huge expectation of of experience. And I think the companies that I see won, most often are the companies that have structure, the companies that have a bit of foundation, they have a little bit of science, and obviously, when they hire good people, the outcome’s with it.

I think data is power. For me, it always, always has been, I’ve never seen data as a micromanaging thing. I’ve seen it as as empowering, right? What do I know there, what can I do about it? Or I don’t understand this, who can I pull into to help me with this? Probably Stitch Fix is when you first you were mentioned in that seat right there at the table, you’re getting a really influential guide to the leadership to drive in the people in the business goals together, and really aligning them and enabling everyone around you. Did you find that was easy for you? Or was it tough? Did you get better at it over time? Like, naturally gifted? What do you think?

Kat Steinmetz: Like using data to help us tell stories or to kind of bolster what we were doing?

Nicki Paterson
I guess, but are both right? I mean, you’ll you’ll definitely be setting your own the board meetings and with leadership. And you’ll be saying, Guys, you want this revenue, we want this goal we want? Yeah. And you’re thinking about it of how do I get the people in the right frame of mind to get there? How do you get that opinion across?

Kat Steinmetz
Yeah, I mean, I think what you’re really getting at that I speak so much. When I’m speaking on other talks, anything where I’m talking to other HR leaders, or just leaders in general. I think when you’re trying to get something done, it’s all about the narrative.

I think that’s the thing I learned so much over my years as an executive, and as a leader, it’s telling a really compelling story. And keep people in the loop of that story that so that they stay engaged and excited, and always know what you’re up to, but not too much, that they’re bogged down by details, but that they can continue to be in that with you and to help support you to bring that story to life. Right. So that’s what I learned, I think so much is and data is what helps you do that, data of all kinds.

I think human stories is what actually brings anything to life and helps people to understand because they can connect with that, right? It’s like, here’s how we’re using that and how that actually comes to life in someone’s life. Right? Whether it’s fear, or however.

So much more now, our lives are in our work, right? It used to be very separate. Now, it’s all there, especially now we’re all home, things like that. So it really is about true human stories. And putting that with really powerful data is really the most powerful way to tell a narrative and a story.

And then people can just get on board with you. They don’t you don’t need them to do a bunch of work if you’re doing that for them. So I really held all of my vendors like I would not partner with a vendor if they were not going to give me all the things that I needed in that room because I did not have time for that. Right. Whatever they were doing for me whether it was a coaching program, or a talent development program, or whatever it was, I asked a lot of them to give me the data, give me the story. Give me the stuff that I can use to tell this narrative so that I was always ready to speak to it at a board meeting in whatever it might be, the CEO comes over, ready to talk to me, I’m read. I’m ready to engage, I’m ready to get that person in talking to me. And then they’re so excited to support your program, right? Because they understand the ROI. They know how it’s impacting the culture. They know how we’re hiring, attrition.

When I was at Box, Aaron Levie spoke of my programs into earnings calls. And I felt like there’s nothing more of a compliment than that wants to talk about. And he loves culture, right? I mean, Fox is very, very well known for culture. Aaron is a VIP tweeter, and loves to talk about all those things. But I felt like if he’s going to talk about that in a call, that’s that’s a pretty good test that we’re doing something right. Because he’s proud. And he wants to tell those data points, right. He wants to talk about, like, here’s what’s happening in my culture. And so the narrative, that’s what I think it is,

Nicki Paterson: Culture for me is created. Right? Like I said, there’s a lot of CEOs that are overly transparent. There’s some that try and hide it all in their own little box and drive it forward themselves. I think, like you say, finding that fine balance between, here’s the big goal, here’s how we get there, here’s your role in what you play and being very, very clear on that is huge.

I think you and I have spoken in the past about personal responsibility. I love that phrase. I mean, I think for me, there’s nothing better than here’s the role you play and helping us achieve this, there’s a foundation, but go and go and get it done. And then okay, I know, feel accountable for this. But that accountability comes about trust, responsibility, I’m not going to let you down. What do I need to do to go and be to go and be successful? I guess there’ll be very different for you in Box or Stitch Fix. How do you create that sense of personal responsibility to some of these companies that you guys support?

Kat Steinmetz: Yeah, I mean, I think what you’re hitting on too, is that there is an inherent sense with humans that they want to do well, right, we all want to do well, we want to thrive, right? Pretty much. And so can you create the container for people to do their very best within that container.

If you’re going from that sort of place, that builds a culture where people do their best, because they are being held accountable with compassion, that’s really the way that I like to do things – hold people very, very accountable, but with compassion, and with kindness. And that’s really how people thrive the best, All the way down to my 10 year old boy, that’s what I do. I hold him accountable, but always with kindness. And he does that for me. And I expect him to do that.

Give me the feedback, hold me accountable when I’m off track, and I’m not being personally responsible for my behavior. I I want him to be able to do that in the world to just like, I want anybody a founder, team member.

I think it’s about being transparent, very direct, but in a way where people feel supported, and they feel like they’re in it with you. Even if you’re giving hard feedback, you can always do in a way that is for someone, and they feel that it’s for them.

The idea of the gift of feedback, when it’s not good as somebody feels like it’s against them. It’s a critique, like I’m now pitted against you and I need to be defensive. That’s just a human thing. So how can you always come from a place where this is we’re doing this together, we’re in a partnership, and I’m here to like, help you to be successful.

And I think that’s the same with founders, they’re just big kids, you know, we all are. So it’s like, how can we be in this together? And I think that’s what we hear a lot in Initialized is, like, Wow, you guys are just different. Like, even when we’re just on a pitch call, you know, it’s like, just from the very beginning, they’re like, Wow, I just don’t, I just don’t get this when I meet with them.

We’re just very human and we just try to, and we very much hold ourselves accountable to be the best that we can in any interaction we’re having with the founder from the very beginning to when they IPO or exit. We fill the entire thing, we’re just filled with integrity around that. How can we do our very best so that they can do their very best because that’s how you get the best outcomes.

Nicki Paterson: I think you get a lot of founders in early stage companies, they can’t let go the arena. They want to be in all the way. And I think it’s that self awareness sometimes in all that. What’s going on, what’s for the better? The thought of treating people the way you want to be treated? For sure be transparent but also people see through the BS as well. You’re always gonna be able to see that. I mean, I think it’s for you guys, so many different companies, what’s the most common trait you see? Companies that don’t quite get it right and then probably the companies that do get it right, what sets those two apart?

Kat Steinmetz: Yeah, I mean, a lot of it goes back to the things we were talking about. I think the leaders’ culture is the company’s culture. So when we’re looking at company founders, when we’re looking at founders, because it’s early stage, right? They might not even have much product built out. It’s all about the founders, who are they as humans? How are they? How do we feel around them? Is this somebody I’m going to want to work with for seven to 10 years? Because that’s what an investment is. Are they coachable? Are they a person that wants feedback? Are they going to be able to speak in a way where they are very self aware? Do they want to build their awareness? Do they want to be responsible for their behavio?

Those two things just go hand in hand, right? The more you build your self awareness and your personal responsibility, the more you can build out a great culture. And if you’re not doing those things, that’s the way that culture is going to show up whether you want it to or not. And believe me, I’ve been an HR person working against like a salmon trying to get upstream the army and you’re just like, I’m wasting so much time pushing against someone that doesn’t get it. Yeah. And so I started because I’ve always mentored and coached younger women, especially, I do a lot of that for free, whatever.

It’s like you were saying, part of the ecosystem, which is what I do, because that’s my community. And people have done it for me. So I do it all week. And it’s something that always comes back to me, and it’s a wonderful thing to do.

But I think that’s the thing, don’t waste your time if this person does not want to change. And that’s really hard when you’ve taken a job and you feel really invested. But, you know, I think you got to really, you know, look at it and say, Well, what’s really happening here? And what what impact can I have? Right? What impact can I have? And if you can’t have the impact you’re looking for, it’s probably not the right place for you.

I think with founders that we’re looking for is what kind of company are they building? Are they going to have that effect? Or are they going to have the opposite effect where people are clamoring to be there?

I have to go back to Box. They do such an incredible job of hiring. They love boomerang employees, they celebrate. And they talk about how people have come back, they celebrate when people leave, you know, they’re like, they talk about it very openly. They’re like, yes, so so and so went to this place, and they might come back, and we’d be psyched for them to come back. Because they’ll come back with great knowledge. And we love that.

So people are always so dedicated Box. When you see Box posted anything, you will see employees just get on there and talk about it. I still have my box mug and my shirts or whatever. They just really know how to be in that kind of space, rather than the like, pushing away or feeling unsafe, or that kind of stuff. People feel that. And so with founders, what are you creating? Is that the culture you’re curating? Are you aware that you are creating that or you are numbed out and unaware? Because that’s how things end up being toxic.

Nicki Paterson: Yeah, I mean, I think a lot of the episodes we’ve done on here are thinking about talent, or thinking about hiring the recruitment process and where it falls down, where there are successes, a company getting investment and using that investment wisely and building out the right leadership team, and creating the right processes. That all comes before that. And you’ve been involved in, starting with that going into a company where it’s all over the place and pulling it together. And company after company after company. If there was one bit of advice, you could give an early leadership group other than make sure you’re cool and have an awesome culture, what would it be?

Kat Steinmetz: I think being open getting help. That’s what we’re all here for. That’s why you get investors. I mean, yeah, the money, but it’s why people come to Initialized, because they’re like, Yeah, of course, the investment money is something that’s certainly the main thing, but the other reason they really come to us is because we will support in those ways. We have expertise across all these areas. And they can ask questions, and we are here to help. They don’t need to reinvent the wheel. They don’t need to come up with all the answers on their own. Why do that when there are people here that can help?

So I think again, it’s that idea of being cultural. Can you be a person who is open to getting feedback. to getting help. to getting a template. to getting help with your hiring?

So Tiffany, our Head of Talent does not do this in the way of I’m going to find the thing for you. And that’s all with me. It’s the idea of how can I help you to understand how to do that for yourself. Because as soon as you start to get beyond your seed stage or your series, A, you’re on your own, you’re getting at your own team, and we’re helping them kind of like a toddler. We’re helping them to walk, we’re helping them to get on to becoming an adult.

You need to be open to all of that, if you think you already have all the answers, if you think you’re pushing people away. What a waste of time. Are you open? And will you take the feedback so that you can move forward fast and be as successful as possible?

Nicki Paterson: I think that’s why we launched Hiring Enablement a few weeks ago, after 25 years, it was pulling all almost all the strategies, the methodologies, because we want to help companies be more effective, more efficient at hiring. Whether it’s resumes, resources, tools, playbooks, and sites, podcasts, etc. People have done this before. Not reinventing the wheel know, what are the best that help your company be successful? What are the best processes that help you attract the right talent? What are the best frameworks you can use to embody the right the right culture?

Kat Steinmetz: Why not ask you because you all have been doing it for 25 years? Why do I need to reinvent that? You know, it’s the same with us, we do a lot of Hiring Enablement, right. It’s like, or whatever it might be enablement around GTM, or your design or your product, or any of those things where that’s exactly right. It’s the enablement of like supporting you to do that.

Nicki Paterson: I think the really big takeaway is looking at someone’s, do I want to work with you for the next five years, seven years or 10 years, whether you’re a candidate and employee leadership faced.

Kat Steinmetz: Not that much different, investing in a founder or hiring a candidate is a similar thing. And that’s something I realized within about three months of being here. I’m like, Oh, I know what this is. It’s like hiring. Yeah. Right. And granted, they have to have some different things. And it’s not quite the same. They’re not an employee. But you know, it’s that idea, right?

You’re really searching for someone that has these qualities that you see in a long vision. Because investing is a long vision, devotion doesn’t come around right away. What do you really see in this person and how they can pivot, hire people, build a culture, you know, get through really hard times like this market, you know, go out and get more funding, sell all these things give up control. That’s one of the hardest things for an early stage is to give up control and let the people that they’ve hired actually be doing what they hired them to do. That’s the thing I see the most that is the hardest thing is to let that go and really believe in someone else, being able to carry that torch and you doing what you should be doing.

Nicki Paterson: But ultimately, you surround yourself with good people. You want to do that. And I think that’s the absolute key for me.

Kat, I knew you were going to be an awesome guest. I think there are so many areas that we could explore of this. But whether you have an early investor or someone looking for investment, employee, that doesn’t matter. Everybody could take a little bit from this, I can see exactly why you guys are so successful. Why you have been so successful and such a sought after podcast guest. So thank you very much for joining me this morning, and I look forward to talking again soon. Thank you.

Kat Steinmetz: Awesome. Absolute pleasure. Thanks, Niki.

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