What will your investment be used for — some people want to raise money just because they can or think they should. Fundraising is a massive undertaking that requires a tremendous amount of time and effort, but for some people, it can be easier than actually running and growing the company. Hearing that someone raised an obscene amount of money in an early round doesn’t impress me. People have done more with less and less with more. I want to make sure my dollars are actually being put to good use. Early stage investing should see the steepest growth curve out of anyone involved.
As part of our series about “5 Things I Need To See Before Making A VC Investment” I had the pleasure of interviewing Daniel Weisman, Vice President in the Nashville office of Bernstein Private Wealth Management. Prior to joining Bernstein in 2019, Dan spent over a decade as an entrepreneur and trusted advisor in the music industry, most recently as an executive artist manager at Roc Nation. He relocated to Nashville in 2016 to run their Nashville office. In 2013, Dan cofounded the luxury shoe company Buscemi (acquired by Lion Capital, 2015), and he sold One Wipe Charlies for cash and equity to the Dollar Shave Club (acquired by Unilever, 1B dollars, 2016). Dan produced the short film Too Legit starring Zoe Kravitz, which was selected for the 2016 Sundance Film Festival and later acquired by MTV. He is an angel investor and volunteer at the Nashville Entrepreneur Center. Dan earned a B.A. in African American studies and Journalism from Emory University. He is a Grammy voting member, a SAG-AFTRA member, a Billboard 30 Under 30 honoree (2010), a 2011 Grammy Board Governor, and a Grammy nominee. Dan currently serves on the board The Equity Alliance, the Jewish Federation of Middle Tennessee, the Nashville Arts & Business Council, Friends of Radnor Lake and the American Cancer Society (North Central region). He is also one of Metro Nashville’s Beautification Commissioners. He and his wife are devoted yogis, tennis players and skiers.
Thank you so much for joining us in this interview series! Before we dig in, our readers would like to get to know you a bit. Can you please share with us the “backstory” behind what brought you to this specific career path?
I got my start in the music business as an artist manager, one of the most entrepreneurial jobs in the world because if you aren’t hustling on behalf of your artist, no one is.
My first company outside my management company was a radio request widget that was formed in 2010. While it was extremely successful, I quickly realized it was more of an idea than a business — an important lesson that help me structure all my future business dealings. In 2013, my good friend Rob Heppler came to me with the idea of turning a Birkin bag into a shoe — a great idea and a business; the sneaker market was hot, and we were one of the first luxury newcomers to the space. We co-founded the shoe brand Buscemi and, less than 3 years later, sold it to private equity.
In 2019, I left the music business and now work in wealth management at Bernstein Private Wealth Management.
Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
The War of Art by Stephen Pressfield. I am not a huge “self-help” book kind of guy, but this book is so straightforward and covers artistry, authenticity and persona in a way that I found to be incredibly helpful in dealing with artists.
Do you have a favorite “life lesson” quote? Do you have a story about how that was relevant in your life or your work?
“Do the common things uncommonly well” –Nelson Rockefeller. Also, related to that: respond to every email and phone call. It’s probably the easiest thing to do, yet very few people do it. For me, it has led to multiple opportunities.
How do you define leadership? Can you explain what you mean or give an example?
Leadership is setting an example for how you want others in your organization to behave but with an understanding that people have their own style — thus allowing people to add their own spin and take ownership. A great example is my first assistant, a young man named David Stromberg. He came to me while he was in college wanting to get into the music business. I hired him and, as long as he did the work I needed him to do first, I let him bring in his own clients. Together we managed Big Sean, and David went on to manage Travis Scott, two extremely successful recording artists. By allowing David the leeway to do his own thing he learned how to stand on his own and was better equipped for his future success. I believe in giving people the latitude to “do their thing.”. Those who rule with an iron fist might get the most out of people but will rarely get the best from people.
How have you used your success to bring goodness to the world?
First and foremost, through mentorship. While I dedicate a lot of my time and connections to non-profit boards, I am most proud of the time I spend mentoring others. I didn’t have any mentors in the music business, just older, more experienced people preying on me and my clients. I never wanted to be that person and I’ve mentored hundreds of young executives who have gone on to manage top artists or even obtain key positions including president of a major label.
Ok, thank you for that. Let’s now jump to the main part of our discussion. The United States is currently facing a very important self-reckoning about race, diversity, equality and inclusion. This is of course a huge topic. But briefly, can you share a few things that need to be done on a broader societal level to expand VC opportunities for women, minorities, and people of color?
The biggest problem facing America is racism, which is why I pursued an African American Studies major at Emory. I wanted to better understand this problem. The biggest problems surrounding racism in America is narcissism, hyper individualism, tokenism and exceptionalism. Most people think or feel that because something doesn’t directly impact them then it can’t be that big of a problem. Or they think that if they’ve never observed something first-hand then it can’t be true. The problem with this notion is that most people are isolated and insulated. America is largely segregated so there is often a lack of “other” people for white people to truly know and understand. They see token successes and exceptions to the rules either in the workplace or in media which serves as a confirmation bias. Everything becomes anecdotal and not experienced, making the real plight of real people very abstract. Diversity is good, but most people don’t know or believe that. I think ultimately a reinvestment in the American public-school system combined with mandatory military service could create a uniquely American experience that every American can relate to.
Can you share a story with us about your most successful Angel or VC investment? What was its lesson?
In terms of return and total financial gain, my most successful investment was Buscemi, the shoe company that I co-founded. From a purely return standpoint, it would be Dollar Shave Club.
The main lesson I learned from Buscemi is to trust your gut — trust what you know. While I didn’t know how quickly the company would take off, I know sneakers and knew the demand was there. At the beginning, nobody believed in Buscemi, but once the company launched everyone was asking if it was too late to invest. I felt the same way about Liquid Death Mountain Water. Everyone said it was so stupid. Well, they just raised 23mm dollars at an 80mm dollars valuation.
I’m also an investor in Banza pasta, a company started by an Emory grad. I’m a huge fan of the product and when I heard they were raising money I reached out to the founder and asked if I could invest.
Can you share a story of an Angel or VC funding failure of yours? What did you learn?
I invested in House Beer, a popular beer brand based out of Venice. I don’t drink beer, but all my friends told me how much they loved it, and it had this great following. I really liked the branding, but at the end of the day I couldn’t enjoy or understand the product. Long story short, the company ended up going out of business. Lesson learned — avoid investing in opportunities I don’t personally understand or enjoy.
Can you share a story with us about a problem that one of your portfolio companies encountered and how you helped to correct the problem? We’d love to hear the details and what its lesson was.
To be honest, I am not involved in day to day things.
Is there a company that you turned down, but now regret? Can you share the story? What lesson did you learn from that story?
No. There are companies I wish I had heard about and invested in including Honey, which is a browser plugin for consumer shopping sites that searches for promo codes. I also wish I had known about Plaid, a payment processing company that was started by two Emory grads, when they were raising money.
Super. Here is the main question of this interview. What are your “5 things I need to see before making a VC investment” and why. Please share a story or example for each.
- Path to exit — getting in is the easy part; getting out is the hard part. Something could be a great idea, but the valuation might not justify the path to exit. If something is very niche, it needs to have the ability to be highly profitable.
- Honest founders — there are a ton of venture-backed companies who are run by cults of personality that only care about promoting themselves so they can move onto the next thing, versus spending time on any individual enterprise
- Singular focus…but no blinders — it’s very easy to get distracted in the early stages of a company. An example of a founder who had a singular focus on making the product a success is Mike Dubin from Dollar Shave Club. Prior to launching he showed me their first commercial (the one that subsequently went viral). I asked him who made it and he said he did. I was so impressed by the work that I actually suggested that he use it to launch an agency simply to take credit for the video. While Dubin saw that this was a valid idea — and he certainly had the resources and creativity to make it a success — he chose to keep his eye on the prize and, wisely, focus on the core business.
- What will your investment be used for — some people want to raise money just because they can or think they should. Fundraising is a massive undertaking that requires a tremendous amount of time and effort, but for some people, it can be easier than actually running and growing the company. Hearing that someone raised an obscene amount of money in an early round doesn’t impress me. People have done more with less and less with more. I want to make sure my dollars are actually being put to good use. Early stage investing should see the steepest growth curve out of anyone involved.
- Clear thesis — you’d be shocked how many pitches I hear that literally make no sense. They are often describing something that already exists or are describing a solution in search of a problem. I see this a lot in music tech. Most people think they can solve the problems of the music business even if they know nothing about the music business. The best problem solvers are the people who have lived and breathed within the vertical for which they are developing.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Free healthcare. This is a big idea that can’t be fully accomplished without government insurance. Unfortunately, people think healthcare and health insurance are the same thing — they are not. Health insurance is an industry that relies on profitability by not paying for what people need. Healthcare is medicine. Health insurance largely controls medicine. By having government insurance (not government healthcare), you remove the profit engine from the equation.
Related to that, internet as a public utility is necessary. There is no reason every single house needs their own Wi-Fi network. It makes no sense.
We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this. 🙂
That’s tough, but one that comes to mind is the founder of Patagonia, Yvon Chouinard. I love that brand and their values. Their mission is righteous but the way they go about promoting it is kind of subversive. The fact that they will repair clothing, that they have a whole second-hand business called Worn Wear and the fact that they took a stand against allowing companies to print on their blanks that didn’t align with their values is amazing. While companies are not people, they are made up of people and I find it to be odd when companies don’t take a stand.
This was really meaningful! Thank you so much for your time.