BrownHEN interviewed Sheila Bowman Ennis, Brown '86, Principal of McNamee Lawrence & Co, San Francisco, CA.
1. Sheila, you are probably tired of this question, but could you explain how you became Executive Producer of Full Grown Men—it seems a long way from your other accomplishments.
It’s actually way less far fetched than you would think. First, I got involved because the principal writer and director was an old friend from Brown. Second, Executive Producer is a title bestowed on those folks who bring in the money. The fund raising process for the film was exactly the same as the process I run every day as an investment banker to technology companies. I help entrepreneurs raise money for highly risky businesses. Frequently, I am also able to invest in those companies. Similarly, I am the lead investor in the film.
The film, Full Grown Men, was written and directed by David Munroe, Brown ’85. It is the story of a 35 year-old married father in the throes of discovering that he has failed to grow up. LA Weekly made it a critic’s choice and called it, “A very funny, tough-minded film, as entertaining as the wine tour in Sideways.” NY Magazine called it, “A lovely bewitching film with a lot on its mind—a beautiful, delicately observed comedy.” Check it out at fullgrownmenthemovie.com. Having finished a small theatrical release which we WON via the NY Times / indieWire / Sundance Channel Undiscovered Gems competition, we are negotiating our DVD deal right now. Look for the DVD in the next few months and support our independent film by buying or renting it!
2. You must be equally tired of this next question, but raising four children while advancing in a very competitive field seems, to put it mildly, remarkable. Can you give some advice to persons who would like to have a large family and a significant career?
It’s really no different from what it takes for a man to have a big family and a demanding career. Find a spouse who VALUES child rearing, home keeping, coaching, running the extra-curricular programs at school, etc. Parenting is more challenging than any paying job and it is thankless work so the person who opts to do it needs to believe it isn’t a step down from paid work. In addition, marry someone you respect so that when either of you is completely beat up, words of encouragement, advice and counsel are actually considered by the recipient to be useful. Teamwork is the only way to make it work.
3. Why would a person who has been very successful at a large bank, JP Morgan/Hambrecht & Quist, move to a smaller firm, McNamee Lawrence & Co?
Actually, I was with H&Q for 14 years and for 12 of those, it was independent and relatively small. H&Q was bought in 1999 by Chase Manhattan Bank; then Chase bought JP Morgan in 2001. By 2002, the dot.com bubble had burst, I had no interest, nor the political skills to work at behemoth like JPMorgan Chase and I was pregnant, so I left the industry for a couple of years. That’s when I got involved with the film. I actually had two children during my hiatus. Missing the game terribly, I returned in 2005. Perhaps not surprisingly, McNamee Lawrence is a small tech-focused investment banking boutique comprised of a small group of ex-H&Q bankers and a couple of our former clients.
4. Please explain what McNamee Lawrence & Co does.
As I said, we are a tech-focused investment banking boutique with offices in Boston (HQ), San Francisco and London. We focus on corporate finance and mergers & acquisitions, as well as a fair bit of business development advisory. We recently launched a fund so that we can invest in our clients, thereby aligning our activities with those of management and shareholders—a practice that served us well at H&Q for years.
5. Do you focus on financing entrepreneurs with scalable business ideas or do you also finance entrepreneurs with smaller reach? If you don’t, where do you recommend entrepreneurs with smaller scope go for funding?
We are not venture capitalists in the traditional sense. While I have done some early stage investing as part of the “friends and family syndicate,” funding ideas at the initial start-up stage is not my day job. At MLC we are primarily agents matching relatively young companies with venture financing or advising them in their mergers with other small private companies or acquisitions by larger (and usually) public companies.
We invest side by side with the investors we bring into the situation (sometimes a Series A round, but usually Series B), effectively putting our money where our mouth is. If it’s good enough for us to recommend, it’s good enough for our portfolio. We, of course, prefer scalable business ideas but when I use the term “scalable” I am describing the profitability of the company, not just the revenue. Size is less important to us than profitability. That said, since we charge a retainer and a success fee, we tend to work with companies that are past their proof of concept stage, have product sales, a compelling “go to market” plan, and a large growing target market.
I believe all businesses should be self-sustaining pretty early on and should only seek institutional equity capital to expand on a proven idea. The aforementioned “friends and family” syndicates are really the primary way to get a business idea off the ground. If that is not an option, seek angel investors who have experience in your field. They bring not only money but also advice to the table—a double-edged sword if there ever was one!
6. Your first job after Brown was in New Haven and you worked in Boston for many years, I believe. Now you are in Silicon Valley. Would you advise a person interested in software and related fields to leave New England?
Actually, after the management consulting gig in New Haven, which lasted only 18 months, I joined H&Q in NYC. I felt a deep need to work in New York City for at least a few years. I stayed for about two and a half and then, newly married to CA native and Brown Class of ’85 alumnus, Steve Ennis, moved in mid-1990 to H&Q headquarters in San Francisco. So, I have been in the Bay Area since 1990.
MLC is headquartered in Boston, but I am stationed at the San Francisco office. H&Q had a very strong office and presence in Boston, so I have had many clients over the years that were Boston-based. There is a very strong tech culture in Boston. That said, the venture investors on the east and west coasts do tend to be attracted to different types of companies. Almost all of what I know in life can be boiled down to pattern recognition.
As you embark on your entrepreneurial venture, try not to get lost in the minutia and look for the patterns instead. Where are companies like yours financed? Many times they tend to spring from the same soil because there is a key customer base or research-minded university or giant tech company that is no longer stimulating enough. Similarly, because investors build up domain expertise over time, you will see a pattern in their portfolios. It tends not to pay to buck the system and try to be the only company of your type in your geographic area. While it may not preclude success, you will surely miss networking opportunities and the value of being identified as a member of a group of hot companies pursuing a hot new trend, etc.
7. How did a Law and Society concentrator at Brown learn the technology to become a respected writer about software development? The implied question, of course, is what advice do you have for a liberal arts graduate who wants to work in a high technology field?
Well, I’d love to day that I developed deep domain expertise, a real sense for the challenges of software development and was therefore able to recognize a good solution and a good company from 50 paces, but that just isn’t how it works. Sure there are all kinds of engineers who became Wall Street Equity Analysts covering software stocks. I just wasn’t one of them. I brought strong communications skills to the party instead. I was able to bring a lot of information to portfolio managers quickly and in a digestible actionable format.
Sure, I had to learn more than I ever really wanted to about software, but because it was an industry undergoing rapid-fire change, it was really interesting. I really don’t work in the high technology field. I really work in the finance field. I learned pretty quickly that companies and publicly traded stocks are two very different creatures. My job was to forecast both how the company would perform as well as how the stock would perform. This task isn’t done in a vacuum. One gauges how the market is responding and reports on that and then puts that information into historical context with the key being to highlight anomalies. Change is what moves the market.
This type of analysis is absolutely learned by studying the liberal arts. What history test doesn’t ask students to identify the event that prompted the change in policy or attitude or readiness to accept a solution, which was heretofore rejected as unworkable? Great reading and writing skills were absolutely essential to my success. Strong writing skills save time so that one can spend more time doing the legwork to understand the events unfolding every minute. Lastly, studying liberal arts helps one understand human nature and at the end of the day, that’s critical to succeeding in any job, but particularly key in gauging how stocks might move.
8. Any advice for an entrepreneur with an idea about a piece of innovative software?
In this market, you better be in a position to finance the early stages yourself or through a friends and family syndicate because the funding environment for start-ups is very tight. Venture investors and angel investors are fairly strapped because companies take longer to incubate in a difficult market. The days of big money being thrown at unproven ideas with the plan that the money would go toward “market development” are gone. Your solution better be targeting a nasty pain point or you will not get traction. Even well established software companies are increasingly finding themselves having to prove that their solutions are worthy. Rather than pay up front for a major software installation, users will only pay once milestones are achieved. The onus is on the solution provider to prove that he has provided value. That said, lots of great companies (PeopleSoft, Citrix, VM Ware, Google and many more) were hatched in periods of nasty market contraction.
9. Would you speak about fear as a motivation or hindrance toward accomplishment? How has that played a factor in your path, if any?
I think it has both motivated and hindered me. I have a coffee cup in my office that quotes Eleanor Roosevelt saying, “Do one thing every day that scares you.” I am very fearful. I tend toward analysis paralysis, but at least I know it and have been working on it. I would say that net fear has been a positive in that fear of not being able to support myself has driven me to try things that, had I not been hungry, I might never have tried. That said, I have not had the guts to start my own business.
10. Do you have a mentor who has helped you in your career path/personal development?
Not really. Sadly I am one of those people who believe no one else will understand my particular situation, which in fairness, was fairly unique at the time I was really forging ahead. I found out I was pregnant about three months after I was promoted to equity analyst and my career really began to take off. There were few female analysts, fewer still without the technical chops, and none who were pregnant or new moms. I do have a teammate, however. The person who has been most responsible for my career path and personal development is my husband Steve. His unwavering belief that I can do anything “they” can do better, backwards, and in heels, so to speak, fuels me every day.
11. Who are three other individuals (dead or alive) who have influenced you?
My brother, Steve Bowman ’82 has been a huge influence as I have attempted to “keep up” since the day I could walk. Rick Boron, a deceased friend of my family who dared me to excel at a very young age. And Bill Steinecke, my high school writing teacher who had the audacity to flunk me for arcane grammatical errors or logic lapses because he believed I could do better. Each pushed me to reach farther than was comfortable and I am a stronger contributor to everything I do because of it.
12. What is the latest insight (about life, work, play) that you picked up and would like to share with BrownHEN?
My way, while not the only way, is a good way. One goes through many phases in a life and career and different approaches are required at different times. Knowing when to defer and when to persist is difficult. Making the right choice is a function of experience. At this point in my career, I have enough experience to know which way to go, which is nice.
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