An elevator pitch, quick coffee, lunch or Zoom chat might be how some investors get a feel for a particular company or founder. Madison McIlwain picked up what to look for, and the ins and outs of venture capital, seated at the family dinner table as a kid.
McIlwain is the daughter of Matt McIlwain, a managing director at Seattle’s Madrona Venture Group. Growing up in Seattle, she considers herself fortunate to have learned from the longtime tech investor — and she valued enough of what her dad said that she followed him into the field.
McIlwain is now an associate at San Francisco-based Defy, an early stage VC founded five years ago. The firm has several investments in Seattle and is a co-investor with Madrona on two companies — Nautilus Biotechnology and WhyLabs. Prior to Defy, McIlwain spent time at Gap Inc. as a product manager and she has a strong interest in fashion, e-commerce and the consumer supply chain.
We caught up with Madison (and Matt, too) for a twist on this week’s Geek of the Week to talk about VC, family, SF vs SEA, women in tech and more. Keep reading for the conversation, edited for length and clarity.
GeekWire: Tell us a little bit about growing up, learning what your dad did for a living and learning how it all worked. Did it interest you as a kid?
Madison McIlwain: Every kid kind of knows what their dad does. For my family, I was really fortunate that even though my dad always worked really hard, we really prioritized family dinners. In those conversations, questions and curiosity were always encouraged and naturally we all would talk about our days. And then my dad was like, ‘Oh, well, we saw this company,’ and he would kind of give us the 2-minute pitch and he would ask, ‘What do you think of this idea?’ That kind of question-and-answer experience from a young age was just ingrained in us, to be curious. And I loved that it was always this avenue for learning.
He used to co-teach a course at the UW on entrepreneurship, and there was always a pitch competition at the end, and we would get to go along and watch the pitches. I remember coming out of those and [wondering], ‘Wait, what’s healthcare in the cloud? What is this thing? How is this gonna work?’ This was 2007, so getting to be on the front lines, watching my dad learn how basically the internet — and what I consider my everyday life today — got created, always got me excited about technology. It opened the door to what was happening at the forefront of innovation, especially being in the Seattle ecosystem where there was so much amazing and cool things going on in the mid 2000s.
GeekWire: What’s that relationship like now that you are in the same field?
Madison McIlwain: I think what I learned most from my dad is the power of investing in people and putting that at the core of how you build great companies. We are 32 years apart, so there is naturally a little bit of a generational thing there. Fortunately for me he’s pretty hip on all things, especially deep tech. He wears his Allbirds and he had to tell me what GPT-3 was. I think I have him beat on consumer frontline/social and what’s happening in that world. I don’t think he’s on Clubhouse yet, so I might have to throw him one of my invites on that one.
GeekWire: How does your knowledge of VC and growing up in Seattle translate to living in San Francisco and doing that job?
Madison McIlwain: Well, I love Seattle. It’s where I grew up. It feels like my home away from home. It’s the cloud of capital of the world, right? Microsoft and Amazon are there and it is this hub of innovation. And that is a quote from my dad — he calls it the cloud capital. That’s his favorite thing to say. I think for me growing up, Seattle was so important.
The ecosystem that I have here is really powerful and exciting. But as I look to my friends back in Seattle, a lot of my high school friends moved back home and are working in big tech and they’re also getting started on their journeys of building their own things or leaving to join startups. I’m a believer that the rising tide lifts all boats, as tech continues to grow Seattle and SF will. And I’m hopeful that there’ll be more opportunities to invest across borders, so to speak.
GeekWire: In helping companies get funding, do you seek out female founders, do you have a particular viewpoint on what could change around helping more women get the necessary backing in tech?
Madison McIlwain: I should start off by saying I’m lucky that I have an incredible team with Defy who have always valued my strengths as a young woman and viewed that as an asset. I have always felt empowered to be able to look at great companies, no matter who the founders are. [My parents] always treated me the exact same as my brothers, and I felt empowered to go out and solve the world’s problems just as I saw fit. And so I think that that gender mentality is not one that’s ever really come into the forefront of how I approach solving problems and investing. However, I would be remiss not to note where there are opportunities for growth and where the numbers quite frankly can be depressing at times.
I think what it comes down to is, how do you get to know these entrepreneurs? How do you connect to them? Ultimately we’re selling to them on why we are going to help them build the next big business. If I’m being honest, it’s easier for me to connect with young women. I mean, that’s who I am, right? And so these touch points breed network effects that allow for those genuine conversations and those genuine connections that I’m hopeful over time will create a flywheel of more women investing and more women in entrepreneurship.
GeekWire: With your retail/tech background, what’s your take on brick-and-mortar retail in 2021 and competing against all things Amazon?
Madison McIlwain: I have always loved retail technology and I think I really grew up in a really interesting time where e-commerce was just coming online. I grew into what is now e-commerce and the power that that holds for consumers and access to anything. When I had the opportunity to do product management out of college at Gap Inc, at the scale of their billion-dollar market cap supply chain, it was an offer I couldn’t pass up because it felt like the right thing to do to learn at the legacy before saying, ‘It all needs to be redone and ripped out and modernized.’ What can I learn from these giants who’ve been around 50 years when Shopify brands die every day? Getting that 1,000-foot view was incredibly helpful to inform where I think there’s going to continue to be opportunities for disruption. And I wouldn’t count the old players out.
Amazon is amazing at providing great consumer experiences and I believe superior consumer experiences win in the end. They win for convenience for me. And that’s great. But when I think about what differentiates a retailer and what differentiates a brand, and how consumers care today about what their brands stand for, they care for the values and they often now like to put their dollars behind where those values are going. Amazon doesn’t do that as much. That’s not really why you go to them. And I think that’s really a critical inflection point. So shopping by your values and by your brand is going to continue to be a way that I think other types of retailers are going to win, or at least create a really good carve-out for themselves in the market.
And here are Matt McIlwain’s answers to our questions:
GeekWire: What does it mean to you that Madison has followed your line of work?
Matt McIlwain: Madison combines a natural curiosity for how things work with great attention to detail and persistence. She also loves design thinking and specifically how that applies to the entire consumer supply chain. We have always enjoyed talking about innovation and entrepreneurship, and I was pleasantly surprised when she decided to become a venture capitalist. I might have guessed that she would start her own company at some point!
GeekWire: How is she different from you?
Matt McIlwain: Madison has a deep passion for the consumer supply chain, but it goes beyond the systems and workflows. She also has an incredible eye for fashion and design. I have personally benefitted from her eye for fashion as she has significantly upgraded and helped my wardrobe become more “on trend” over the years. And, believe me, I needed the help! While we share a core value that every person deserves the very best opportunity to succeed, Madison has focused her efforts here on creating opportunities for women to have the education, information and access to become as accomplished in life as they aspire to be! Her podcast The Room and her work with San Francisco Girls School are a couple examples as are her efforts to back female founders.
GeekWire: Does it make it fun to check in with her and talk shop?
Matt McIlwain: It is really fun to share a career with one of your children. And, while there were many challenges during the past year, a silver lining for us was that we were in person quite a bit and would often go for jogs and talk about the venture world. We also are known to chat about trends and companies at the dinner table, but sometimes there was a little too much “shop talk” at the dinner table!
Learn a bit more about this week’s Geek of the Week, Madison McIlwain:
What’s your workspace like, and why does it work for you? I have a desk that sits in the Victorian bay window in my 100-year-old San Francisco apartment. It gets great light but has horrible insulation! Between my monitor, laptop and plants I’m set for form, function and fresh oxygen.
What’s the one piece of technology you couldn’t live without, and why? My Zojirushi; instant hot water is a game changer as a tea drinker.
Your best tip or trick for managing everyday work and life. (Help us out, we need it.) I’m a bit of a Notion addict. As a former PM, I love using Kanban boards for personal organization. I also get a lot of satisfaction dragging things from “In Progress” to “Complete.” Whether it’s on Notion, Coda, or Trello, I think having a personal “roadmap” to drop all your to-do’s into helps declutter your mind.
Transporter, Time Machine or Cloak of Invisibility? Time Machine. I was a history major!
I once waited in line for … the midnight book release of Twilight’s fourth book … this is the Geek of the Week column after all!
Greatest game in history: “BlackBerry Brick Breaker.”
Best gadget ever: The Kindle.
Favorite app: Right now, Fable! I love to read and this app is unlocking incredible reading recommendations and folios. Think Spotify, for books.
Favorite cause: San Francisco Girl’s School!
Most important technology of 2021: COVID-19 vaccine.
Most important technology of 2023: Technology and supply chain innovation that empowers entirely closed loop consumer behavior! We need to build better systems that allow consumers to shop while sustaining our planet.
Final words of advice for your fellow geeks: Lean into curiosity, and if you’re a founder, stay determined to build a better experience for your customers.
LinkedIn: Madison McIlwain