GP Interview: John Cowgill
John Cowgill is a partner at Costanoa Ventures and lives in the Bay Area. This is his Emerging Manager interview.
👉 Big Learning Up Front (B.L.U.F.): We pulled our operating team early into the DD process recently, which helps us preview our work for prospective founders and gives us better insights for selection.
John, tell us about yourself
I grew up in Lexington, Kentucky. It was a great place to be a kid, but by the time I was 18 I was very ready to get out. I wanted to be a musician or an actor, and went to school in Chicago to study theater. But my parallel passion to music and acting was technology. When I was six, my Dad bought me a subscription to Wired magazine and my love for tech was born.
I bounced out of my theater major and into startups then management consulting for my first few years out of undergrad, and was lucky enough to join Costanoa in early 2016 as its first associate. I expected VC to be a 2-year detour before starting a company (famous last words).
I live in SF with my amazing wife English (who is a writer, of course) and I love the outdoors, riding my bike, and playing my guitar (the acting habit died hard). It’s just the two of us right now, but we’re expecting the first addition to our family, a baby boy, in a few months.
Describe your fund, Costanoa
Costanoa is a Seed and Series A enterprise-focused venture capital fund. Our core areas of investment focus are applied AI, cloud native infrastructure, and fintech. We take a high concentration, high conviction approach and lead or co-lead rounds in relatively few investments per year (6-10). We typically write $2-4M checks at Seed and $4-8M checks at Series A. We have a reserve-heavy model in both our early stage fund and a separate dedicated opportunity fund that enables us to deploy up to $20-25M over the course of a company’s life. We also incubate 2-4 companies a year, where we work with founders at the formation stage (and pre-pandemic had them work in our office).
Most importantly, we pride ourselves in investing meaningful time in setting every one of our portfolio companies up for success, both through hands-on work as investors and with our in-house operating executive team. Everyone in the firm has operating experience, and while we love investing, it’s working with entrepreneurs post-investment that drives us. One of the companies we’re most proud of is Alation, which has created and leads the enterprise data catalog category. We incubated the company out of our office in 2013 and led their Seed round, doubled down by co-leading the Series A in 2015, and have invested meaningfully in every financing round since.
Share 1 process improvement you’ve used individually or as a team which has made you a better fund manager
Our operating team--senior executives in every startup function who spend all of their team with our portfolio--is a huge part of what we do. We think it’s a uniquely valuable asset and a real difference maker in companies. The problem is that every firm says that, and the reality is that most operating teams don’t make much impact. So we’ve made the process change to incorporate the operating team earlier in our investment DD process, scheduling working sessions with founders on topics that are top of mind for them. Beyond showing the founding team exactly how we work, it also gives us great insight into how the team thinks and what it would be like to work with them.
Which founder from your portfolio has had the greatest impact on you and why?
This is a great and very hard question to answer. If I had to pick one, it would be Kevin McNamara at Parallel Domain. Kevin was the first founder I backed at Costanoa as the sole investment lead, and I was greener than green in terms of understanding how to really support and help entrepreneurs when he picked me as a partner. Watching Parallel Domain grow from a company that was just Kevin and an idea at the time of our investment to a company that is defining and leading the category of synthetic data has been a thrill. But the reason Kevin has had the most impact on me is how he’s handled adversity. The highest highs and lowest lows at Parallel Domain have been particularly acute, even by the standards of an early stage company. The way Kevin handled them gave me a newfound appreciation for the meaning of the word grit. He’s also been very patient with me as I’ve learned the ropes of how to be a great board member.
What’s 1 thing you wish you knew before you became a VC?
The startup journey is almost never a clean exponential curve, even though those stories and graphs may dominate the headlines. Companies that look to be breakouts will get out over their skis and can’t recover. Companies that are struggling mightily will find a novel approach and suddenly break through. Success or failure is never pre-ordained, even when things look to be humming or hopeless. The future is so uncertain that the best superpower you can cultivate as a VC is to not get too high or too low--be the steady, calm voice whether things are rocking or rolling.
Tell us the story of a rabbit hole you recently fell deep into
I’m a bit embarrassed to admit this, but I started training for a triathlon three months ago and have gone way down the rabbit hole of how the body recovers. I read all the usual stuff--sleep, nutrition, stretching, etc. But the rabbit hole that really grabbed me is breathing. The science behind the effects of breathing on the body is fascinating stuff (e.g. mouth breathing = very bad). I’ve found a number of breathing techniques I incorporate into my day that can invoke powerful responses--sleep, focus, calm, increased cardio capacity. I highly recommend Breath by James Nestor as the starting point for this rabbit hole if it sounds remotely interesting.
Name 1 GP and 1 LP everyone should learn from -- and whom we should feature next
GP: Brad Gillespie, IA. Brad is a master of two things every VC should always be working on: empathy and big-picture strategic thinking.
LP: Lindel Eakman, Foundry. As my partner Greg says, “Lindel is the single most straight talking LP you’ll ever meet.”
Also I think you should feature Jai Malik of Countdown Capital next. It’s been inspiring to watch Jai launch and build his own fund from scratch through nothing but hustle, curiosity, and empathy. I’m a proud LP!
Finally, what are the 3 best emojis?
🤦♂️ 🤷♂️ 🕺
John Cowgill is now on the EM roster at EmergingManager.vc. << View all these EMs, learn from them and then teach me some new things. Thank you John for spending the time with me on this, and thank you to our mutual friend Rudi Thun for the initial introduction to him many years ago when Costanoa led one of the first Roadster rounds. John’s contact: @JohnCowgill or LinkedIn. Thank you - Reilly (@reillybrennan or firstname.lastname@example.org)