ND Founders Profile #155: Mentoring startups—six unicorns!—and students

TIM CONNORS

As the youngest of eight children growing up in Fort Wayne, Ind., Tim Connors had a wealth of mentors. First and foremost was his father, John, who, after the fifth child, finished college at night to earn his degree. He took his wife and children to church every Sunday and dreamed that the kids would all go to college one day—as long as it was to the University of Notre Dame or Purdue University.

His older sister Cathi ignited his curiosity in business. When he was just 14, she gave Connors two shares of P&G stock, which started him on his career trying to understand how value is built in companies. Older brother Kevin Connors '83 was always there to help his little brother. To this day, the first person Connors calls when he has an important decision to make is Kevin.

When it came time to pick a college, Connors suggested to his father that they tour Marquette University. “He reiterated what my choices were: Notre Dame and Purdue. I chose Notre Dame.”

The family wasn’t wealthy, so Connors participated in work-study. This turned out to be one of the best things that could have happened to him. He landed a job as a cameraman with WNDU, Notre Dame’s television station. Every Sunday morning, he shot Father Hesburgh’s weekly mass followed by Coach Lou Holtz’s recap of the previous day’s football game. The lessons learned from these mentors on Catholicism, faith, and leadership left an indelible mark on Connors, one that would guide his personal and professional life.

After graduating from Notre Dame, Connors received a GE Foundation Scholarship to Stanford University. There, he earned a master of science in electrical engineering and computer science, which propelled him to his first job as an engineer at Tandem Computers, which was acquired first by Compaq Computers and then Hewlett-Packard.

From there, Connors joined C-Cube Microsystems as a product manager. At the time, C-Cube was a startup company backed by Sequoia Capital in Menlo Park, Calif. During his four years at C-Cube, which led to the startup becoming a publicly traded company, he worked with Pierre Lamond from Sequoia, who taught him how to build great products. When Connors mentioned to Lamond he was thinking of going to Harvard for an MBA, Lamond said, “Look me up when you get done.”

Whether it was impatience or simply knowing venture capital was the road he wanted to take, three months into the Harvard MBA program, Connors reached out to Lamond, who offered him a job at Sequoia.

“My three years at Sequoia were great. Pierre continued to be an awesome mentor. Mark Stevens, another venture capitalist at Sequoia and fellow Catholic, taught me how to analyze markets,” Connors says.

In 2001, Connors joined U.S. Venture Partners in Silicon Valley as a general partner, where he continued to build his knowledge base. He spent 12 years with two of the top venture firms in the United States, a period he calls his apprenticeship, racking up significant wins.

By 2010, Connors, who is a devout Catholic and has attended mass often on a daily basis since his Notre Dame undergraduate years, decided to strike out on his own, founding PivotNorth Capital. “I wanted to make investment decisions based on my moral compass.”

And that belief system is simple. “You can do well by doing good. I want to build win-win businesses with societal impact,” he says.

PivotNorth is also unique in the venture world because it focuses primarily on pre-seed and seed stage companies that are often still finding their way. “I invest scary early,” he smiles, “typically before revenue. I have found the highest returns come from investing in pre-seed rounds. The risk is high, but you can make a massive multiple coaching the founder. If I do it right, 95 percent of the value is in my coaching and five percent is in the funding.”

Connors’ investment thesis is heavily influenced by Pope Benedict’s encyclical published in June 2009 titled Caritas in Veritate (Charity in Truth). He focuses on three principles of Catholic social teaching: vulnerable families, the planet and the Catholic Church. The ultimate goal is to solve these systemic problems with technology in a way that allows the founders and employees to do well, but also for them to do good in the world.

“I think in systems,” Connors explains. “What systems need improving? Here’s an example: Forty-two million people suffer from hunger in America. Food deserts, communities where supermarkets and healthy foods are not available, are a contributing factor. So let’s address food supply chains.”

Among his portfolio companies is FlyZipline.com, which got its start delivering blood and medical supplies using drones. Connors got in at the pre-seed stage and actively mentored the founders. Today, Zipline is the world's largest autonomous delivery system, specializing in on-demand drone delivery and instant logistics.

“I believe we can apply Zipline to solve food deserts, delivering food to people who don’t have access to stores near their home.”

Over the course of his 25 years in venture capital, Connors has had six unicorns, two of which he got involved with before they had customers and now generate over $1 billion in revenue each. One of his unicorns is Chime.com, a popular banking app that is overdraft fee-free.

 “Overdraft fees really hurt low-income people. Get a couple of $35 overdraft fees and it’s easy to get into financial trouble. Our revenue model is based on getting a portion of the merchant fee when people use their debit cards. We don’t have to charge punitive fees to customers.”

Running his own venture firm has allowed Connors to spread his love of mentoring young people far and wide. In addition to endowing the Notre Dame Venture Capital Club for students, he actively serves as a mentor to student entrepreneurs at Notre Dame and the Catholic University of America, where he also serves as a trustee.

“I like to ask students about what big problem they are trying to solve. Father Sorin, the founder of Notre Dame, defined the university’s mission as teaching young people to be a force for good. Students sometimes struggle with what that means. I try to explain it in simple terms. If vulnerable families, the planet, and the Catholic Church thrive, we all thrive. We are here to solve a need.”

Connors is thankful that unlike many startup venture capital firms, PivotNorth has been free of challenges. “I came in knowing how to be a venture capitalist by learning from and apprenticing with some of the best in the business. I had a good plan when I started my own firm. I've been very blessed to have folks who cared enough to mentor me along the way. I've been working hard to pay that forward.”

In terms of his biggest success, Connors says it’s hard to pinpoint one thing. He is happily married and has three adult children. In keeping with Connors family tradition, two graduated from Notre Dame, and one graduated from Purdue. He is the co-founder of the Connors Foundation for Catholic Activities, which does impact investing and grants to people and organizations moving the needle for vulnerable families, the planet, and the Catholic Church. His wife and children work alongside him in this venture. Connors has been named to Forbes Midas List, which ranks the world’s top 25 venture firms and seed stage investors, four times.

Asked what advice he’d offer to young people who want to become entrepreneurs, Connors offered this:

“If you are in the Notre Dame family, reach out to me on LinkedIn. Notre Dame students should go talk to John Henry and Matt Gardner in the IDEA Center and they will coach you. You can also go to my website, pivotnorth.com, and ask questions of TimGPT there. I’m always open to reviewing startups’ pitch decks.”

Originally published by Melanie Lux at ideacenter.nd.edu on August 07, 2024.