Lux Capital Partner Deena Shakir speaks with Yahoo Finance's Julie Hyman at SXSW about women in the VC space and investing in women's health.

Video Transcript

- But how about women's Health one of the interesting topics at South by Southwest in Austin, Texas as things really get underway today. Are women's health care underserved in the US? That's one of the things Julie Hyman will touch on with a special guest down in Austin. Hey there, Julie.

JULIE HYMAN: Hey there. Good to see you, Brad. And we are indeed talking about women's health and more broadly venture capital, which is a big topic always here at South by Southwest. I'm joined by Deena Shakir. She is a partner at Lux Capital, which is a venture capital firm. And she invests in lots of different areas, but she has been talking here in particular, Dena, about women's health.

I want to put a pin in that though, and get to that in a moment because first, I want to talk to you more broadly about venture capital. And in particular, something I've been trying to get into with folks and VCs lately is, what we're seeing in public markets and the sort of turmoil that we're seeing in public markets and the risk that's coming out of public markets in contrast to private markets. And if that is playing out at all. Many people are telling me it hasn't really yet.

DEENA SHAKIR: Yeah, thank you. It's a great question. I've been asked it a lot as well. And as early stage venture capitalists, we're really investing in a 10 and often longer than 10-year horizon. We're not picking stocks. We're not necessarily thinking about value in the context of what a market calculation might be today.

Obviously, we want to look towards at some sort of public exit or public generational standing company in the future. But it's not as affected by the near day-to-day volatility of public markets. I think it will eventually make its way down. But what I'm seeing actually is there's been a lot of capital and dry powder deployed towards early stage funds, and they want to invest early. That's really where the exciting opportunities are.

JULIE HYMAN: And it doesn't sound then like there are necessarily bargains to be had or the valuations are coming down. Are we seeing, though, investors getting more choosy than they had been?

DEENA SHAKIR: I think it seems somewhat dichotomous that the clear winners are in very competitive situations and often with very high valuations. The not so obvious ones may start to struggle a little bit more. But on the early side, it's definitely still very competitive. And you can still get a good deal. What might seem like a very high valuation will still be very valuable in the future.

JULIE HYMAN: Right. I guess if things are going to be huge, then the valuation is attractive.

DEENA SHAKIR: One should hope.

JULIE HYMAN: Yeah, exactly. So let's talk about women's health because that is an area of focus for you. Where do we still see significant gaps that you think some of the companies are investing in or are addressing?

DEENA SHAKIR: Well, I could talk about this all day. I'm very passionate about it. It blows my mind that women's health was considered niche and was considered some sort of tangential afterthought up until fairly recently. Despite the fact that obviously we are half the population, but we also control 80% of the dollars health care spending.

Women are often the chief medical officers of their families. And so women's health is not only a wedge into women's bodies, their reproductive systems, their mental health, but also into broader family health. The dollars are massive when you think about the TAMs in all of the related areas when you start to invest in women's health.

JULIE HYMAN: So what do you think changed in terms of starting to unlock this area in a more targeted way?

DEENA SHAKIR: I think a couple of things. First of all, the investors around the table started to look more like you and me. And to us, it's very obvious and very personal. And I think many of us are embracing that conviction from a personal perspective and bringing that to our thesis. And that's also the case for founders that we're seeing.

Kate Ryder from Maven Clinic, which is one of the companies that we're invested in where we co-led the series D. It's the first unicorn in women's and family health. And she's really become a role model for a lot of early stage founders who see that there is not only a venture-type outcome, but truly a generational opportunity to be had here at the earliest days.

JULIE HYMAN: So let's talk about some of these companies then. And you mentioned Maven, so let's start with Maven. And here we have a telehealth company, although I know it does more than that. But talk to me about how its approach is different from-- I mean, we're seeing more and more telehealth companies out there. So what sort of distinguishes Maven?

DEENA SHAKIR: Yeah, so there are a lot of things. But ultimately, it's the most comprehensive solution not just for women's health, but for women's and family health that exist today. That's in terms of the diversity of the types of providers, the types of care. They offer benefits ranging from pre-fertility all the way through pediatrics, the first 10 years of life.

When it comes to women's health and postpartum care, it's everything from lactation support to sleep coaching, career coaching, and everything in between. And we see that employers want those types of solutions. They don't want to be navigating many, many different vendors for benefits. Maven is also going into MedicAid, which is an absolutely critical market when it comes to frankly, everything, but especially when it comes to maternal health.

JULIE HYMAN: Do you find it challenging for companies like Maven or some of the other companies you're investing in to sort of cut through because there are-- it does feel like we are in sort of a golden age of startups, and in particular, medical startups and, probably even more particularly, telehealth startups. Is it difficult for them to cut through both with employers, but also with consumers?

DEENA SHAKIR: Certainly for the earlier stage companies, I think that's very true. You know, there's a lot of talk about potential consolidation of these types of point solutions, et cetera. And part of what really attracted me to Maven is that it had clearly emerged as the category leader with its comprehensive solution. So I think we will see and we're already seeing more and more of these types of M&A transactions happening at the earlier stages for the very reason I described. It's very difficult for vendors to evaluate such a myriad array of solutions.

JULIE HYMAN: And I have one question for you left, so I want to get this in even though I know it's something you talk about a lot, which is how to bring more women into venture capital. And then as you say, you create that sort of virtuous cycle where they're investing in more women-led companies, et cetera. But how do you start? I mean, it's something what, 2% is it of women or VCs are women still, which is an incredibly low number.

DEENA SHAKIR: Yeah, 2% of women-only founded companies.

JULIE HYMAN: OK, got you.

DEENA SHAKIR: I think the number of women check writers now is around 15% to 17%, which is still very low. We need more of that. And there is data that shows that women investors do invest in more diverse companies, diverse founding teams, hire more diverse workforces. So there's really like definitely a domino effect. It's critical.

How do we do it? Honestly, these types of biases and self-perception start as early as 18 months of age. We know that as parents. And so representation matters. And that matters across the board both for founders and investors. There's a lot that we can do to be role models for the next generation. I have a lot of women that I personally mentor.

There are amazing organizations out there providing peer group support as well as mentorship. I don't think I could survive without the peer group women that I have, that I rely on, share deal flow with, talk about everything from negotiating term sheets to dealing with signing up for soccer classes for our kids.

JULIE HYMAN: Deena, thank you so much, really appreciate it. Deena Shakir is a partner at Lux Capital. Thank you. Rochelle, back to you.

- All right, thank you, an important conversation. Our very own Julie Hyman there.