I spoke with Paul Judge, Ph.D., a successful technology entrepreneur and investor, about finding and supporting today’s underserved founders, the leaders of tomorrow’s organizations.
Judge has invested in over 30 tech startups as founder of Atlanta’s leading seed-stage venture fund. He’s now a managing partner of Panoramic Ventures, which just launched a new fund with a target of $300 million focused on the future – overlooked regions and founders.
This interview has been edited and condensed for clarity.
Tell me a little more about your background and your new venture’s focus.
After building a few firms as an entrepreneur, I moved to early-stage investing. Three pillars – geography, diversity, university – define the experiences I had as an entrepreneur and what I now see as the keys for investing in the future of work.
I moved to Atlanta 25 years ago to attend Morehouse. As an entrepreneur, I’d build a company here in Atlanta, then get on a plane every week or month to find the funding. People would ask, ”Why are you staying in Atlanta?” And I would respond by saying, look at the talent that’s here!
Georgia Tech has ten engineering programs that rank in the top five nationally. Emory has a quarter-million college students here. There are sports, and fertile ground to create innovation here. So that’s why I’m staying – great entrepreneurs and wonderful companies, but I just have to get on the plane to get the capital.
I lived the reality in terms of diversity, being black and in technology. A lack of equality exists in the educational system and secondary schooling. Then think about the traditional venture capital world that often relies on warm introductions on the network. Today black founders receive less than 1% of all venture capital investment. Women founders receive less than 3%.
Some of the most talented people I know aren’t networked in Silicon Valley, but they’ve identified outstanding problems and found great ways to solve them. They have the grit, determination, and people to build solutions.
I often think that being able to survive as black in America gives you all the attributes you need to be entrepreneurial. You’ve figured out how to be successful in the face of adversity, and you have figured out how to have grit, and how not to quit when things get hard. We realized that these qualities represent an overlooked world for founders.
When I did my Master’s degree and Ph. D. at Georgia Tech, I realized all these brilliant minds are working on very tough problems. These solutions would often sit on a shelf and never emerge into the real world.
We’ve now successfully spun out ideas multiple times, like Pindrop and Codoxo, which started as research papers. We were able to go from a research paper to an algorithm and then to the software. Now, at Pindrop for example, that software is running at eight of the top ten banks, and at three of the top five insurance companies.
A lot of magic in those research labs needs to emerge and solve problems in society.
We think the university is a place that’s overlooked because investors may not naturally just walk the hallways at colleges and meet with the professors and grad students.
Over the last several years, many of our investments have been on one of those three pillars. What we’re doing now with Panoramic is combining the forces of BIP capital and my ventures. At $300 million, it will be the largest tech fund in this region. I believe we can make an impact here in the Southeast to fuel the next generation of entrepreneurs.
How do you go about identifying overlooked founders? Sometimes people are ignored because they aren’t sought out, and sometimes they’re just hard to find. How do you identify them so that you can have this incredible diversity?
Part of it is having people know that you exist and that your doors are open. A tradition of mystique built so many great VC firms.. No email addresses or phone numbers were available. It’s like a secret society, and if you’re first-generation in technology, from a diverse background, and you don’t know the secret handshake, then what do you do?
One thing that we implemented many years ago at TechSquare Labs was that anyone could come to the site and apply. It’s not about a warm introduction. It’s not about, “Can you guess my email address?” Instead, it’s “Here’s a form.” Tell me about your company. We read every one of them.
The Startup Battle is at the heart of what we did. It’s a competition that we hold twice a year and it began by thinking about diverse founders. Often, they don’t have the friends and family round to access for funding.
So how do you get the first $100k or $250k? With the Startup Battle, we gave the winner $100k as their first funding into the company. Initially, we expected maybe 100 companies would apply, but we had 500! We’ve now done it eight times over the last few years – and 500 or 600 companies applied every time. People who participate might never have gotten a start otherwise.
We’re allowing people to go from a dream to reality. Open access and open doors are crucial. It sounds like something simple, but it’s amazing how many investors don’t have that policy.
The second thing I’d say is look at where diverse founders are located. Often people are in the middle of San Francisco trying to solve the diversity problem. Well, there are not that many black people in San Francisco. So, let’s go to cities that are already diverse. Let’s go to Atlanta, to Detroit, to D.C., let’s go to HBCU (historically black colleges and universities) – to Morehouse and Spelman and Clark. That’s what we’ve been doing to invest in diverse founders and what we’ll be doing more of with the new venture.
What was the process for getting into the university to walk the halls? After you graduated, what did you do to find entrepreneurs to support?
Traditionally, if you think about accessing a university system, you think, “I’ll call the school and do some corporate deal.” But that’s not how you meet people. You have to understand who the professors are and their research interests. What projects do they have open, what research lab, who are the grad students working on those projects? If you understand the people, their skills, expertise, and interests, you can build relationships over the years. Then, when someone has an idea, and they’re thinking about commercializing it, there’s a good chance they will pick up the phone and call you. Or if you’re working on something and you need to find someone who’s an expert in it, you can pick up the phone and call. We’ve seen both.
Think about Fraudscope – it was a research paper. They called us and said, “You helped many people go from a research paper to a company. We’ve figured out a way to see if there’s fraud in the healthcare system. And this is a bigger problem than credit card fraud.” We also helped create a company like Oculogx (now Ox). It was founded by a female undergraduate, she figured out how to use augmented reality to help people get around warehouses faster.
Ox grew from a little prototype that she was working on as an undergrad to a company that has raised millions of dollars. She’s a great CEO. She has several Fortune 100 companies as clients. She was a 19-year- old college student who started with an idea. We had the good fortune of being accessible. She called us.
To succeed in the future, you need to build those relationships, understand the areas of expertise, and then roll up your sleeves and get to work. Don’t be afraid to get involved too early.