North Star Leaders Podcast

Lindsay Pedersen

The world needs what only your business can bring. And as a leader, it's your job to deliver. But where do you focus? Where do you direct your time, your team, your budget, and your emotional energy? We're learning this together on the North Star Leaders podcast. In this podcast, I talk to purpose-driven leaders about the choices that they make to create audacious economic value, while also realizing their distinctive purpose. I'm Lindsay Pedersen, brand strategist, author of Forging an Ironclad Brand, and host of the North Star Leaders podcast. Let's get to it. Today, I am really happy to be joined by Mike Fridgen. Mike is Managing Director for Madrona Venture Labs, and in the past was founding CEO of Decide, acquired by eBay, and the founding team member at Faircast, acquired by Microsoft. Mike, welcome to the show.

Mike Fridgen

Lindsay, thank you so much for having me. I'm such a fan of you. You're a pro's pro in all things brand. Thanks for all the support you've given us over the years.

Lindsay Pedersen

It's been a joy. I love talking to you. I love working with you. And I'm so glad that you were willing to be on the podcast with me today. My first question for you, Mike, is what is your favorite thing about what you do?

Mike Fridgen

My favorite thing about what we do really comes back to a very special connection and partnership we have with founders, people who are taking almost unimaginable risk level sacrifice to pursue something that's so meaningful, it can't be ignored. It may not make sense to take this risk financially, but they are just so called to do it and to play a small role in that, especially in the beginning, when few believe, when you really have to go out, take some risk yourself to believe in a bold vision, that's a meaningful time to build a connection and to be in someone's corner. That's the most meaningful thing about what we do.

Lindsay Pedersen

I love the coinciding of these two things, like it has to be done and it might not make sense, like sort of that there's a leap of faith in some sense. And I also get the feeling and since I know a lot of founders, I know this to be true. There's an incredible vulnerability to being a founder, like literal risk, financial risk, and also heart risk, like you're doing something that might not make sense to other people and you're doing it in order to be successful. There's so much heart and soul that has to go into it. So, it's really vulnerable and you get to have this privilege of being with them during this kind of era of vulnerability in their life.

Mike Fridgen

Absolutely. And to try to change the odds, increase the probability of success is a responsibility we don't take lightly and something that drives us to be our best. We know how important it is and that's our commitment. Getting behind people in that moment is a sensitive time, but it's one where you really kind of feel the weight of the responsibility.

Lindsay Pedersen

Yeah. Well, and the fact that it's a sensitive time is what makes it so potent. And it's like it's not a bug, it's a feature kind of to use your language. Tell my listeners a little bit more about Madrona Venture Labs so that they have context for what you're describing.

Mike Fridgen

Sure. You bet. Many people locally here in the Pacific Northwest are familiar with Madrona Venture Group. It's an approaching 30-year venture capital firm that's been committed to supporting founders, as we collectively say, from day one and for the long run. I mean, from the earliest stages through every stage of a company's development and growth. And throughout the history, even early on, Madrona would incubate companies, working with founders very early stage. But it wasn't until 2014 where Madrona launched Madrona Venture Labs, was essentially an incubator. The idea is partnering at the formation and pre-seed, the zero-to-one phases, to help fast track and de-risk early founder and startup success. And so, our team and our makeup of Madrona Venture Labs are all former founder builder types. We have the hard-won lessons. We've made the mistakes, even within the studio, perfected and optimized how we validate ideas, how we build early traction, and how we help companies get to that initial round of funding to help that company really grow and bring to life that vision in terms of a product and customer traction and all those different pieces. So our team across design and product and engineering and data science, all those areas come together to really rally around an early founding team. It might be a solo founding technical leader, go-to-market product leader, and help with every element, recruiting, building, validating, all the things that come behind it. And so that's what our role is. And then Madrona has a core fund, which is seed and A, which invests in companies as they're maturing. And then a third phase, which is their growth fund, which is really backing companies at the B stage and beyond. So that's the continuum, Madrona Labs, Madrona, the core venture firm, and the acceleration growth fund.

Lindsay Pedersen

And is there a defined articulation of the Madrona Venture Labs specific North Star or purpose?

Mike Fridgen

Absolutely. Our North Star is founder success. Everything we do is about adding value, de-risking, fast-tracking, increasing probabilities of success for the founder and the early-stage team. And one thing that's unique about how we back up that North Star and that focus is we take accountability for outcomes. So, I think that's a very different thing. We're not advisors. We're not pure investors. We're co-builders. We're going to take those bricks. We're going to like to feel some of that pressure and anxiety. The founder is the founder. I mean, they're the one in for the long haul. They're the ones that should be celebrated and outcomes. But in terms of taking accountability, ownership for outcomes that matter, you know, customer development, product innovation, the pieces that move the needle, those are things that our team work in partnership in concert with an early founding team to deliver.

Lindsay Pedersen

I love that you said what you're not. Like we are not advisors or advisors only because it gives so much crispness to what kind of the presence of positive. The thing that we are feels more sharp because you're also saying what you're not or you're not afraid to put out there what you're not. I love that. And I also love like when I think of founder success, the things that drive success, one way of kind of organizing it is like the things that create failure. One is like too much risk. And two is too much time. And three is lack of obviously, there's more reasons than that. But you're backing up founder success, that big promise with two very factual and functional reasons to believe. You’re de-risking and you're speeding it up. You're fast tracking it and you're de-risking it. Because it's one thing to say, we're all about founder success. But if you can actually make it more granular, why we're able to deliver on that promise like those pillars do, it makes it so much more credible and kind of makes it sing. Like I just love it. I love your purpose.

Mike Fridgen

I do too. I appreciate that. And there's so many facets of it. There's how we work together day to day on the most pressing risks or opportunities facing the early company. There's the way we structure our value exchange. I mean, getting that right, making that make sense, both for the founder and kind of what that cap table dynamic looks like, but also for future investors. Founder success is not having a lopsided cap table where the founders don't have the right incentives over the long haul or investors are looking at something so non-standard, they have to take kind of leaps of judgment to kind of get in or logic to get there. All these elements. And it's been a real journey. I mean, over the last nine years here at MVL, tinkering and iterating with every dimension of this, what's our process? What's the business model? How do we design this in a way that optimizes for, for lack of a better term, high founder NPS? I mean, not just founder satisfaction in the moment, but founder satisfaction down the line, two, three, four years later, we're looking back saying I wouldn't have done it any other way. And the most ambitious, talented, driven people that I know I would recommend working with this team of people. And there's a lot that goes into that. And so, we've dissected and broken down every element of our process and model and with the founder at the center, back to that North star and how does what we do equate to founder success? And if it doesn't remove it, simple. So we do a lot of work and you were part of some of this work we did some years ago around understanding founders perspective on the studio model, holistically on working specifically with us and other studios, really trying to break down and understand where founders perceive value, where they see value and where that participation by this from the studio relates and outcomes that matter customers, product kind of financing outcomes, those types of things. So yeah, we care a lot about that.And I think it kind of at the heart of what drives us is to get that right. And I think what helps is having been there, having spent such a longer period of our careers collectively as a team on the other side, feeling the, like you just said, the vulnerability of being a founder, feeling all that pressure and risk and saying, how can we, based on everything we know, kind of really tilt the field, like really provide advantage and help founders feel like they have someone in their cornerthat it's going to increase the probabilities of success.

Lindsay Pedersen

Yes. I love that. And yeah, so you have an operator background and you've been in the trenches as a CEO and operator, and now you're both the leader of MVL. You're also in a position to be advising other leaders. What's it like to be both a leader and operator at MVL while also a guide to leaders of MVL startups? Is there a toggling or like a mental ninja move for you to be able to do both?

Mike Fridgen

Even you saying that I had to tilt my head and think about the question because I don't think about it like consciously, right? What's interesting about MVL, I mean, what it brings to mind for me is that I've thought about MVL as a startup. I assumed we didn't have the answers. I assumed the model wasn't figured out and very open and still have to learning and listening and evolving and iterating and just continuing to believe there's a more perfect version of this in the future somewhere. So in a way it's been like operating a startup, like the studio itself. And I think that open mindset and drive for an attainable perfectionist never be there, but kind of a drive for like, Hey, we can be better. We haven't figured anything out. We should continue to be learning and iterating and going. That's the same kind of energy that happens as an early founder. I mean, you have a vision, but there are a lot of paths to get to that outcome of what you're trying to achieve. And it's that just constant learning and iterating, pushing to be better. So I think those two things, although like the way you frame that question up, I had to think about are those, am I in different modes? Am I thinking differently? I don't know that I am actually, I think it feels the same.

Lindsay Pedersen

You know, as a company, as a leader, you want to have empathy for your quote unquote customer, because that's your job is to provide them with some value. So it's hard to know what the value would be if you don't have empathy for them. And yet, if you kind of in a funny way, are the customer, because either you've been there or you currently are the customer, it's not as much of a mental leap to put yourself in their shoes, because all you have to do is kind of ask yourself, well, how would I react to that? At one point in my career, I was managing a Clorox laundry brand. And it was before I had kids, I didn't have a washing machine in my house, I didn't do a lot of laundry. And my customer was a mom with multiple kids getting dirty all the time. And so I really had to spend a lot of time with them to like understand like, what's it like to be an overwhelmed mom? Now I know what it's like. But back then, it took work to kind of get out in the field to feel that and I never can really feel it until you've been in that position. And then there's like, what you're describing, or like Harley Davidson is a brand that does this really well, where they don't really hire people that don't like to ride motorcycles. In fact, at the campus, they have like a special parking lot for people who dare to drive cars to work instead of motorcycles, because their employees are the customer and like the advantage is this like built in empathy, but you don't have to run a focus group, you just ask yourself.

Mike Fridgen

That's so interesting. Yeah, there's so many dimensions to that to that example you gave, you get it culturally, you get it as a even being with the product in a day in day out basis, there's so many like benefits to what you described there. And I even kind of brought to mind for me a bit the importance of what we call founder idea fit. I mean, as we think about the types of founders that we want to partner with, we're so interested in their journey to this point, their journey to this insight about this opportunity they want to go after. And generally, it's even more than they realize it's this very hard one insight, like they've worked their career, they've seen so deeply in this space, that this has come to them where 99% of other people wouldn't arrive at that they just haven't seen the things that founder had seen that insight would not have bubbled up to most of us, right. And so it's kind of related to what you're saying, you know, and sometimes founders are our customers, you know, it's a former CFO selling a product into the office of the CFO, okay, that happens, right. But I mean, in the case of kind of being in a domain, we're working on a travel idea right now. And the value of the leader, knowing that category and the nuances and kind of the history and evolution, it's been so valuable, like, I don't know how we would do it without the depth this founders bringing to everything product and go to market all the elements, there's so much nuance to landing this correctly, and the depth this founders bringing. So it just reminded me a bit of, like, why that's so important from an early stage, having domain depth in the founding DNA is so important.

Lindsay Pedersen

What you're making me think too, as you describe that is that there's kind of the obvious, like, you know more about it, like if you're the customer, or you are really close to that customer experience, you've experienced the problem yourself, you cognitively easily grasp the problem. But there's also sort of an energetic unlock with that to that there's like this deep well of I remember what it was like to feel that I have this like deep hunger to solve this that it's harder to summon if you've never felt that pain before, or if it's like an abstract pain, if it's deeply felt on the hard days, you're better able to bring it when you're in touch with that insight.

Mike Fridgen

Yeah, I mean, one of the things you said there that really tapped into another thing, I think keeps people going over the long run, which is being on a mission to solve the problem. Because if you're connected to that, there will be a lot of ups and downs. I mean, that should be planned. I mean, this thing, if we're ever going to have breakout success, we'll have a near death experience, you will be challenged, there'll be a moment of truth, you'll have to say, even though I've invested so much, I can't stop moving forward, I have to move forward. Usually that comes from like, I care so much to solve the problem. I'm on a mission to solve it. And the solution might change, or the market might change, or the competitive landscape might be new people coming in. But like, none of those things are going to take me off this like burning desire I have to kind of overcome the problem. And so that's another I mean, we talked about like, what do we look for in founders, we look for founder idea fit. So there's a kind of story around the domain. But another thing we're really keen on, like, why this problem, because that seems to be the thing that carries people through.

Lindsay Pedersen

And our mutual friend, Kristen Hamilton, who's been on the show before talks about when you fall in love with the problem, as opposed to the product, there's sort of a an ever refilling well, to solve it, because the problem, there's just going to be new ways to solve the problem, there are going to be better ways to solve the problem, the problem is going to morph, and you're still going to be able to solve it with different products. So like that kind of obsession with the problem, as opposed to your solution to the problem, it's more of a deep gratification for the customer. It's also more fueling for you as the person who has to like, sweat blood in order to make it happen. When you think about these businesses, you're trying to create economic value. This is not charity, you're trying to create economic value. How does purpose fit in? What's the role of non economic purpose in the creation of economic value, economic value can be tied to impact, right?

Mike Fridgen

We're talking about scale of which customers have are impacted by the innovation you're bringing to the world. So you know, I would tie those two things together. And again, back to the purpose, you can't fake kind of this passion for the problem, it's an important problem you believe needs to be solved in the world. So that comes from a place, it's actually not economically driven. And most people, again, getting into this don't start as being well, the economically driven thing, if you were driven by that, then you could look at the odds and say, I probably shouldn't do it. You know, we're going after our people who can do this on their own, which is why our responsibility is to bring forward unique value that changes the probabilities of outcomes. Because again, these people are people who are already successful or already have an incredible trajectory. And they're choosing to partner with us, because again, we can tilt the field. But coming back to the core of your question, the purpose and the mission on solving the problem is really at the heart of then what really I think drives great economic value long term. And that value can come in the form of the massive impact customers feel from you solving that problem, that thing that was so like deeply rooted in you and what drove you to take this risk to go create this product or solution in the market.

Lindsay Pedersen

Are there trade offs of creating businesses that are purpose driven versus more neutral or more mercenary? Like, is there anything that you don't like about working on businesses that are purpose driven, either now or like in other parts of your career?

Mike Fridgen

What that brings to mind for me, Lindsay, is just the fact that not all companies should be venture backed companies. There's a lot of ways to start a company. And there's a lot of different outcomes you can look for in starting a company. And being honest with yourself early on about that, what does success look like? There's bootstrap models and nonprofit models and there's a lot. And so who are your partners and what are the expectations? It's just like anything else. I think in the venture world, the expectation is growth, growth, growth. This is a venture scale. This is going to be an outlier. We are going to build a massive scale, high value enterprise here. That's the world of venture. And a very few things, actually, I mean, if you look holistically in businesses that are built, should be going after that route, should be swinging in that way. And so I think the trouble can be, I mean, kind of back to kind of friction or the personal mission or what they're trying to go after doesn't line up with the model. The venture model is growth, growth, growth.But there's a lot of ways to go about building a company. There's a lot of ways to add value and realize your true kind of intention and vision for an idea or for solving a problem.

Lindsay Pedersen

Yeah, I feel that it's like most businesses in the world should not be seeking venture backing. And they actually can be purpose-driven businesses as well. It's more of a like scale thing. Like the person who cuts my hair, she's not going to scale her business. She's not interested in that, but she actually does have a deep purpose. And she really does relate to the way it makes people feel when they walk out of her salon and that kind of thing. Like so you can have like purpose, but you wouldn't seek venture funding unless you also want to scale. So that's sort of like a certain flavor of purpose. One of the things that I've noticed among the leaders that I talked to on the show is the usefulness of self-care and especially rituals for preserving your energy and taking care of your animal body. What are the things that you as a leader to prepare yourself for the week or to show up as the leader that you want to show up?

Mike Fridgen

Yeah, I mean, as you were saying that, I was thinking about kind of on a macro level, travel and adventure on a more day-to-day and also because it provides, I've got two teenagers and it provides a way to connect outside the habitual day-to-day running through the week, school, work, whatever it might be. So that's been really nourishing on a personal level, on a connection to family. And I mean, that's just been so important and also been intentional and planned. And you were asking a slightly different question, but I'll finish this story. I mean, we just completed a goal we had of 10 international trips in 10 years. And the idea was that we complete these the year before our son was to go off to college and we move them into school on Friday of this week.We're dropping them off to the East Coast. Yeah. So that was a planned, intentional, all kinds of pieces to it. Family connection, education, cultural awareness, all kinds of things were wrapped up in that plan. But I mean, without that parallel tracking, kind of an ambitious, intense careers with my partner and I, that would have been a real mess and a real void, I think, in our lives.

Lindsay Pedersen

Wait, before you go on to the rest of my question, where did you go for your 10th trip?

Mike Fridgen

We went to Antarctica and Patagonia.

Lindsay Pedersen

Oh my God.

Mike Fridgen

It was amazing. Yeah. We had a great, great experience. And we did the polar plunge in Antarctica, which was a crazy fun thing to do. And none of us lasted too long in those iceberg infested waters.

Lindsay Pedersen

Are you in dry suits?

Mike Fridgen

No, no, actually. But you do have a harness on you. They have you on a harness tied to a rope and you jump out and then you're like, please pull me in very quickly. Then they pull you in. And it's shocking, but it's really fun. There's a lot of people who cold plunge and it's certainly colder than that, but it's bearable.

Lindsay Pedersen

Wait, okay. Wait, you willingly, with no... Were you wearing a wet suit?

Mike Fridgen

No, no. Your skin just went into the Antarctic sea. It was shocking. Yeah. It was an absolute, crazy, immediate shock to the system.

Lindsay Pedersen

That is epic. I'm going to have more questions for you later about that. Okay. So from the sublime, the Antarctic to 10 international trips, your son about to go to college. I mean, that's so poignant. To the day to day, what do you do?

Mike Fridgen

Yeah. I mean, I don't know that I do anything that unique or novel. I like to run. I mean, especially now as my kids are older, I mean, my physical activity would match with whatever my kids were doing, sport or my daughter really likes to hike. So that's a thing we do together. Just about every week through the summer, we'll pick a hike and we're just moving down our list of saved hikes on our AllTrails app. And we add to them and we knock them off. And we just did a Grand Canyon Rim to Rim hike together, which is a cool just adventure with her and something that we really enjoy together. So just being in the outdoors, being in nature, running, hiking, those are the things that, you know, mixing those in are really important to me.

Lindsay Pedersen

Yeah. It sounds like it's like the combination of the nature and the fresh air and the relationship building elements of being together and moving together.

Mike Fridgen

Also something about the bit of struggle, which I would put with just about everything. But I mean, even as my daughter and I were doing this hike, it's always, it was like, it's really hot, obviously. And in the Grand Canyon in July, we did it this last month. And, you know, we were even saying this to each other as we're struggling, you know, the last mile and a half to get to the rim. We're like, that meal we have to taste so much better because this hurts. This is uncomfortable. Like we are struggling and we want to be done and quads are shaking. But like, okay, because this hurts, it'll mean something. It'll matter. You know, it'll feel like we did something. I kind of think about that in career. I kind of think the same thing. You're going to struggle, you know, be ready. It's going to be painful and a lot of emotional and there's going to be a lot that you pay. But for to get it worth it, anything worthwhile, it's going to be uncomfortable. And there's going to be some struggle attached to it.

Lindsay Pedersen

It's like you can't create meaning, sitting in a hot tub all day. It's like, if you're on the couch, or if you and she had gone to a spa, I'm sure it would have been enjoyable. But would it have been as bonding?

Mike Fridgen

Yeah. And I'll have to ask my wife and son who do that. So when we do our hikes, they go chill and do that and they have a great time. You know, actually brings up an author, Arthur Brooks. I don't know if you know him. His research is on the like science of happiness.And he has a whole piece in there that really resonated with me around, we're in this loop of there has to be some hardship that you're overcoming. And that's the path to happen is you don't get the flatline on happiness. Like it has to be in a sense earned.And there's a cycle to it. And the way he framed and I'm not doing it justice and crystallize that concept was really powerful and resonated with me personally. He's got a book that's popular called strength to strength. He just wrote a new book on happiness with Oprah Winfrey that came out maybe several months ago now, but he I think he really kind of has interesting way of bringing that concept to life.

Lindsay Pedersen

Yeah, I love Arthur Brooks. And I love strength to strength. It's kind of this idea that like, oysters don't build a pearl unless there's a little bit of sand in there. And it's sort of it's the same. It's just harkening back to the reason that you do what you do for NBL. It feels very similar to the journey of being a founder, like there's a pain there struggle. That's actually what engenders a pearl to begin with. Oh, this has been so wonderful. Okay.I have a few rapid fire questions for you. Are you ready? Okay. Yeah, sure. Okay. Your favorite guilty pleasure TV show.

Mike Fridgen

Oh, this is a funny one. Love Island. Because my daughter is into it. And it's like, we have fun joking around about that show. So Love Island.

Lindsay Pedersen

Love Island. Are you a morning person or a night owl or neither? Probably lean morning. What is your go to karaoke song?

Mike Fridgen

Prince's Kiss.

Lindsay Pedersen

Yes. I have to see that Mike. What's a book on your bedside table right now?

Mike Fridgen

Well, you know, I just read it was a light read. Arthur. It's a story of this international racer who befriends a dog on the journey and then adopts this dog. It's just I love pets. I love my dog. It was like, saw the movie on a plane.I fell in love with the story. So I had to go get the book. It was just, you know, I'm on the plane trying to pretend like I'm not crying. And it was like really touching. But it was the story really brings forward the spirit, just the living spirit that's in all of us. And yeah, it's a real true story and a very touching story. So I just like a two day read, but it's a cool story.

Lindsay Pedersen

I'm going to read it, Arthur. Okay, lastly, what's your favorite kind of candy?

Mike Fridgen

I'm not a huge candy person. My wife is a huge candy. She likes nerds. She likes like all the different candies from way back in the day. So she's the candy person in our house. I'm kind of more of like an ice cream and cookies person.

Lindsay Pedersen

What's your favorite kind of ice cream?

Mike Fridgen

I'm probably going to go with mint chocolate chips up there.

Lindsay Pedersen

Love that. Mike, this has been so great. Where can people find out more about you about Madrona Venture Labs?

Mike Fridgen

Yeah, Madrona Venture Labs is madronavl.com. We love chatting with founders no matter what type of company they're looking to build, whether it's a venture-scale company or not. We love making that connection and if we can be helpful and supportive. So madronavl.com is the best place.

Lindsay Pedersen

Awesome. Thank you so much, Mike. Thanks for listening to this episode of North Star Leaders. Make sure you don't miss an episode by subscribing on your favorite podcast app. If you know of a North Star Leader whose insights would be valuable for this community, please message me on ironcladbrandstrategy.com. Also on that website are show notes, transcripts, and a way to sign up for our monthly newsletter. I hope you join us again for another episode of North Star Leaders.