What does it take to successfully navigate the transition from being an entrepreneur to a CEO while maintaining your company’s core values intact? This intriguing question sets the stage for a deeply insightful conversation with Anne Maghas on "The Angel Next Door Podcast." Anne’s journey from curiosity about angel investing to becoming a significant mentor and investor is full of valuable lessons about leadership, diversity, and resilience amidst rapid change. Anne Maghas, our esteemed guest, is a three-time entrepreneur and an experienced angel investor who holds a PhD in chemistry. With nearly a decade in corporate America working in consumer product development, Anne transitioned seamlessly into entrepreneurship. Her ventures span a data analytics consulting company, a retail distribution enterprise, and a logistics business that thrived even through the challenges of the COVID-19 pandemic. Alongside her entrepreneurial efforts, Anne is deeply committed to mentoring and educating the next generation of angel investors. In this episode, Anne shares her remarkable journey. She goes over essential topics such as the importance of diversity and inclusion in problem-solving, the significant role of mentoring in helping founders become effective CEOs, and the critical nature of cultivating a strong organizational culture. She also offers her hiring philosophy and insights on building trust within teams. Marcia and Anne's discussion is a treasure trove of wisdom for anyone involved in or interested in the startup ecosystem. This is a must-listen episode for aspiring entrepreneurs and angel investors looking to glean insights from Anne's multifaceted experience and thoughtful approach to leadership and investment.
What does it take to successfully navigate the transition from being an entrepreneur to a CEO while maintaining your company’s core values intact? This intriguing question sets the stage for a deeply insightful conversation with Anne Maghas on "The Angel Next Door Podcast." Anne’s journey from curiosity about angel investing to becoming a significant mentor and investor is full of valuable lessons about leadership, diversity, and resilience amidst rapid change.
Anne Maghas, our esteemed guest, is a three-time entrepreneur and an experienced angel investor who holds a PhD in chemistry. With nearly a decade in corporate America working in consumer product development, Anne transitioned seamlessly into entrepreneurship. Her ventures span a data analytics consulting company, a retail distribution enterprise, and a logistics business that thrived even through the challenges of the COVID-19 pandemic. Alongside her entrepreneurial efforts, Anne is deeply committed to mentoring and educating the next generation of angel investors.
In this episode, Anne shares her remarkable journey. She goes over essential topics such as the importance of diversity and inclusion in problem-solving, the significant role of mentoring in helping founders become effective CEOs, and the critical nature of cultivating a strong organizational culture. She also offers her hiring philosophy and insights on building trust within teams. Marcia and Anne's discussion is a treasure trove of wisdom for anyone involved in or interested in the startup ecosystem. This is a must-listen episode for aspiring entrepreneurs and angel investors looking to glean insights from Anne's multifaceted experience and thoughtful approach to leadership and investment.
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Marcia Dawood
Hey Anne, welcome to the Angel Next Door podcast.
Anne Maghas
Thank you, thank you. So glad to be here.
Marcia Dawood
I am excited to talk to you. You're an angel investor. You've been a multiple time entrepreneur. You and I met because we met because I think of the Angel Capital association, but we spent a lot of time together working on venture wells program aspire and helping all those amazing entrepreneurs. And I just think the, in the conversations that we would have, the types of insights that you would bring was just amazing. So I'm really excited to have this conversation. So start off, tell our listeners a little bit about your background and how you learned about angel investing. All right.
Anne Maghas
Yeah, this is, you actually probably met me at the most exciting point in terms of the things that I enjoy. I'm a three time entrepreneur turned angel investor but mentoring is really where my passion is. So you met me like in my joyful space doing that. So a little bit about my background. I, I'm a scientist by training, so I have a PhD in chemistry. I'm not a practicing chemist so don't ever ask me anything about chemistry. Although every now and then I'll, I'll mention something on the periodic table and my kids will be like how do you know that? And I have to remind them, oh, that degree that I have did something. So after my schooling I went to corporate America.
Anne Maghas
I worked in corporate America in product development for maybe I'd say eight, eight, nine years I worked in corporate, corporate America. All that time was spent in consumer products. So that is another space that I really understand really well. And I feel my training as an entrepreneur was actually happening while I was doing product development because I had to go from concept all the way to product design all the way to getting commercialization ready to kick off. So it was a fully cross functional team that I had to work with the whole time through. So a lot of things that I've had to look back to as an entrepreneur it was managing a team, managing a crisis, managing to a deadline to launch date. Because in consumer products a product kicks off with a launch date in mind. There's nothing that is just being done for curiosity sake.
Anne Maghas
So that was, it gave me a good foundation. And then somewhere towards the end of my product development career I, I decided to go to business school and going and I want to explain my reason for going to business school. It was mostly and this would tie into the entrepreneurship. As I was working on the projects I realized I was executing projects and not deciding on what projects should be worked on. And so I asked myself who gets to decide this project? And it was the business people that were deciding the project. And so I decided, oh, okay, then I'm going to go to business school so that I'm one of those business people that gets to decide. So I went to business school and then while I was in business school again continuous curiosity asking about. Now I look back, it was a pursuit of freedom that was kicking me in that direction.
Anne Maghas
I wanted to be in charge of my own destiny, in charge of my own time. Around that same time I was a new parent. I have two boys, two grown teenagers now, but they were all born 2006, 2003 is when there were little babies. So at that time was premium for me. Just having the flexibility to be able to go to the ortho on a Tuesday and work on a Sunday. That kind of flexibility was so appealing to me. So those are some of the things that were pulling me towards. Be your own boss.
Anne Maghas
Be your own boss. So as I finished business school, I really only spent another year in corporate at that point and I decided no, I need to exit this train and figure out what I can do on my own. And that's when I came up with my co founding my first company and the first company I co founded it with my husband. So that's a whole. Anyone who's worked with their spouse understand that comes with a whole set of blessings and challenges and opportunities. But that was really, it was an easy entry point for me at that point because he was already he had the expertise in data and analytics. I brought the business expertise and together we could build a company so we're able to hire employee number one and grow the company. Three different locations in two different states.
Anne Maghas
But at least I had, I didn't have to culturally bring different things into the business. I already understood where the vision we had, the two of us and I had to think about other things.
Marcia Dawood
And what was that doing?
Anne Maghas
We're doing data analytics consulting. So a lot of it, I was not subject matter expert but I was in charge of all the business operations, all the strategy and all that stuff. It's still going on right now. I stepped away from it, but it's still going on and running just smoothly as we intended to. But because I get bored I found other things to start keeping myself over utilized, I would say.
Marcia Dawood
But it was company number two.
Anne Maghas
Yes. Yeah. So I went on to do company number two and this time it was with four other co founders, which by itself a company of five co founders was, was not the best way to set up things. But it was very informative for me because this was a company where I actually started understanding what angel investing was. Because this company, we needed to raise money. We needed to raise money. So then as a founder, I was starting to pitch angels, trying to pitch and get some funding for it. We worked this with other.
Anne Maghas
The other co founders were all over the place. One was in San Francisco and others were in Kenya and in South Africa. So it was a very global thing. Our customer was in Kenya and then he was in three other countries after that, which posed its own challenge. The opportunity was really great because it was a wide open market, we could do everything we wanted. But in terms of operationally, over time, it was difficult to manage it as being a CEO that is, you know, some distance away from where the customer is. And after we raised. It's easy to, to bridge that gap when you're only raising a little bit of money from some angels.
Anne Maghas
But as we said, trying to raise institutional money, then that became a challenge because the question would always come up, how are you managing this from a distance? What I wanted to tell them is, have you met me? I can manage this. But that was not a good enough answer. And now that I know better as an angel investor, I would also have a difficult time with that kind of arrangement. I would want somebody to be fully paying attention to it. So I totally understand where they're coming from.
Marcia Dawood
And what exactly did that company do?
Anne Maghas
That company did retail distribution. So we were servicing it and it was still in the same consumer product space, which is a space I understood consumer products, retail distribution to small kiosks. So we would think about a variation of like a marketplace, Amazon, like marketplace, but with very distinct only consumer products being delivered from one place to another. So that's what we did with that company that is actually still going on. I just had to step away from it because I was. And we talk about this when we're talking angel investing because I could not functionally continue with it. I was being dead equity on the cap table. So I understood the danger of doing that and came to conversation with the other co founders how I would relinquish both my space on the cap table and my actual operation in the business.
Anne Maghas
So I moved away from that which created space for my third, my third business, the third business. I'm a solo founder on it. Part of it is learning the complexities of all that. And so I arrived at this. I'm both a solo founder and it's not venture backed and it's not venture Backed not because it was by choice and it didn't need money to start with because it was operational and revenue generating right away. And this third business is in logistics. And we started the business in 2019, right before the pandemic. We actually started June of 2019.
Anne Maghas
So June 2019. By December of 2019, I had a good hang of business. I was still doing 18 hour days running the business just because everything was running through me. So by the time January of 2020, February, I'm like, oh, finally got this now let me have some rest. And March 2020 hits and it's no get up, let's go back, let's go back in. So March 2020, while everybody was staying back home, I was one of those people getting out there because I needed to hire people so quickly. I was hiring people in masks, like I don't know what they look like. I'm just, you know, doing that onboarding, training.
Anne Maghas
All that was happening when the pandemic was hitting. But it gave us good opportunity for rapid growth and we got to learn all those challenges that comes with rapidly growing. It was a different environment at that point, but it was good. It was good too.
Marcia Dawood
And the people that you were hiring, they were helping with all of the different logistics. And now because of the pandemic, the logistics had totally changed. Is that.
Anne Maghas
Yeah, yeah, yeah, no. And a lot of people were hiring, were not in logistics now. They were just people were laid off. You had all kinds of people that were new to it. But that to me, and it's one of my philosophies with hiring people is just hire the right people and not necessarily the skill of the people. And I learned that over time. And I know for some people it's expeditious to focus on the skill. For me, I have had, my experience has been if they believe in the vision, they have the curiosity and the ability to learn, you can bridge the gap, the skill gap a lot faster than you can bridge attitudes and lack of vision, lack of alignment, those kinds of things.
Marcia Dawood
So you did a lot with growing and scaling different businesses. So talk a little bit about that transition that founders have to make when they go from being a founder to realizing that they have to be the CEO of a company.
Anne Maghas
Yeah, that to me, I think is a critical. That is one thing I'd say, like, how have you been successful doing this? It's because I learned how to scale my leadership very early on. I learned the importance of going from leading a team for all the businesses. I always did the first hire Number one, all the way to a hundred people. In order for you to be a leader that is effective with one, with a team of five and a leader that's effective with 100, you need to be able to scale a few things. And for me, one of the things that you need to scale is your own capacity as a leader. Initially, everything comes through you. You're setting the vision, you're setting basic all the way down to processes.
Anne Maghas
But in order for you to really be able to do more with other people, you need to be able to figure out what is it that I can see in other people that will help me delegate pieces of what needs to get done. Because if you don't delegate, then you're the limiting factor. You're the limiting factor in every progress that is going own leadership capacity. And to me that starts with the self awareness of what are you good at, what are you not good at, what you complement from other people and identify it in people very quickly. And it's not enough just to identify it in other people is validate them. That way they can truly step into the same position as you as far as that particular aspect of it is concerned. Because you could be, let's say you're delegating a certain aspect of operations or finances or whatever. People still look up to you as the leader to be the final person.
Anne Maghas
It's on you to build confidence in them so that they feel they are as good as you in this particular aspect. That way you can both relax and they do it and you don't have to be checking on them. And that takes intentional work of really trying to not only build them, but show the rest of the team that they can count on them. They don't need to count on you. So scaling that piece, the other piece I'd say that's important is building trust within the organization. And at any given point there are opportunities for you to have other people believe in the vision that you have. But that trust for them to know that what you're telling them is worth, is worth working hard for, comes through different opportunities to build trust. And for me, some of the best places that we've had to build trust is when there's a crisis, which for somebody and as a founder you get many crises, like crises are just Christmas gifts showing up every day.
Anne Maghas
So in of those crises just being clear that your values are coming through because that's where they get tested. If you say you care about a certain thing or you care about, you care about, let's say people in A certain way, but you're choosing something else when it's time, when that's at risk, or when one of your employees is having a difficult time of some kind, how you react to that, I feel as a leader, your team is always watching. They watch the decisions you're making and they're watching. Especially at those times when generosity is scarce, when time is fast, when the. The time when you're making choices that are not the easiest to make. At that point, that's when you're informing people what is it you value and that's how you're gaining their trust. Because they can see, oh, when she didn't have as much whatever, when money was limited or when time was limited, this is how she chose to spend it. And that's how you build the trust.
Anne Maghas
The third thing I'd say that's important for that founder to see your transitioning is the culture of the organization, how you scaling the culture of it. And to me, these are things that you're doing, these things to make your job easier as the CEO. If you can scale the culture, then you don't need to be policing what is going on. The culture itself becomes what guides people. And for that, it is a balance between letting people know what it is they need to do versus policing them every time, oh, no, you didn't do this. That's why that's happening. And I found the best way is to be clear on what are the values that you have on this organization and celebrate those and let people see how they're being celebrated in the organization. For example, if you say one of your, like, for me, a personal value and a cultural value that I have from my company is excellence, the way we live, excellence.
Anne Maghas
When new team members are coming on board, I give them examples of what excellence looks like. And I give very tangible examples. For example, this thing you did yesterday, that's demonstrating how excellent we are. And I keep reinforcing that. You're joining a team that is excellent in what we do. We take pride in what we do. It takes effort. It may seem effortless when you're looking at the results because we've been doing it for so long, but it takes effort to do that way.
Anne Maghas
And upfront. I tell them there's going to be some coaching that will happen. The coaching is not going to happen because we are trying to correct you did something wrong. We are just saying upfront, it'll take some time. We didn't get this way overnight, so we're going to coach you that way. You Understand what's important for us. And most of the time, we could tell within a few months the people who are going to be a cultural fit, how they take that coaching. And the people who think like, why are you telling me what to do? They don't understand the bigger picture of what we're trying to do.
Anne Maghas
We're trying to get to a point where then we don't have to pay attention. We don't have to each be watching each other's work. We're all clear that everybody knows why they're doing that.
Marcia Dawood
Yeah, I love that because we've talked on the podcast before about culture, and I think it's really hard. And when you're in a small company, because everybody's moving so fast, everybody has to do more than usually one, two, sometimes more than 10 jobs, usually especially the CEO. And so that culture and establishing that right off the bat, it can be hard, but at the same time, if it's not done, it can go awry, you know, pretty fast, right?
Anne Maghas
Yeah. Yeah. And I have learned from experience in some of the bought company that I started, but also working in corporate, when the culture is not there, it takes so much energy trying to fix it. And that's why to me, I prioritize it, because I've been there. I've been where I'm trying to fix. I've been where I'm working with leaders that I cannot trust to do the right thing. So I'm constantly trying to pull them aside, pulling this one aside, trying to course correct, pull a different aside and try it. Just mental energy that is used in that is not worth it.
Anne Maghas
As for, for new founders, it is at the beginning, you may think, oh, I want to optimize a product, I want to optimize this. Take the time to situate your leaders, right, to make sure that they're doing that. You'll go so much further if you've got a leadership that is united in the same vision and the same understanding of why you're doing what you're doing, because you could hire somebody to do a technical piece, but that culture is really the job of the leader to make sure that it's put out, right?
Marcia Dawood
Yeah, absolutely. So then. So you learned about angel investing through the fact that you were trying to raise money for your own company. So then what made you decide? And why do you like the idea of being an angel investor yourself?
Anne Maghas
So. So once I learned this, so my first entry point was curiosity was why can't these people just give money? The ideas are good. I had a good idea.
Marcia Dawood
Right, right, right, right, right.
Anne Maghas
One day, not getting on board. Just get on board. So it was more curiosity about, okay, why wasn't there a connection then as I started learning about it? Because for me, I get comfortable with things through knowledge. So I had to go and Google my way to figure out, what is this angel investing. And as I said Googling it, I was like, oh, okay. The more I learned about it, I'm like, oh, damn, I am an angel investor. I'm qualified to be an angel investor. Why am I not an angel investor? And at that point, I was already through my companies, say, maybe 2016, 2017, just for being a founder.
Anne Maghas
I had already said mentoring other founders. So I was already familiar with how do you guide and mentor other founders to help get them to where they need to go. So then when I learned, oh, angel investors invest in these companies, they can offer their expertise in these companies. And I was like, oh, I'm already doing 70% of what this thing, what these angels do. Now I just need to actually start writing checks to do that. And so once I learned about it, I got myself connected to Angel Capital Association. Actually, I don't remember the very first. The very first way, but I remember the very first person I learned from Angel Capital association was I asked.
Anne Maghas
I think I asked Sarah, if I'm looking for somebody to help me, to help mentor me in this journey for angel investing, would you connect me with someone? And they connected me to Don. That's how I got awesome. That's how I got to meet. Yeah, I got to meet Don because I asked somebody in ACA could you connect me with someone to serve as a mentor for me? And I got to meet Don. And after that, I got to go through Angel University, got to learn everything that I needed to learn, and started getting involved. And now I invest, I help teach other new angels in the space. I mentor people. And it's.
Anne Maghas
This is what I've been waiting for. I've been waiting to do this stuff because building a company is exciting for me, but. But helping other people understand how they can navigate it is even more interesting for me.
Marcia Dawood
Wow. And that's so needed. I don't know that there are enough people out there really mentoring from the. With the hat on that you do.
Anne Maghas
Yeah, it's always. And for me, the part that gives me a lot of joy is most of the time, the delta that is needed is something so small. Like the things that click for people, they're like, oh, my goodness, I didn't Know that. I didn't know I could do that. Like, the click points are so small, but they happen because you're building a relationship. So first you build a relationship, and then the few things that open that are just changing for people.
Marcia Dawood
Yeah. And I know you've talked in the past about diversity and inclusion. Like, how do companies. Again, back to the culture, but how do they make sure that they're paying attention to this as they're building companies?
Anne Maghas
That is something to me, I find it like. And it's not just. It's not just diversity that is using agenda lens or arrest lens or all kinds of lenses that you can use. But I look at it in terms of what are the lived experiences that these people have that will bring a different perspective to the problem. And maybe this sort of a scientist in me, like, I care about the inputs that are coming in before we can figure out what to do with it. And the different lived experiences of different people, we could all be dealing with the exact same problem, but somebody else has had an experience that informs their perspective differently. And so when you bring that to a place where you're solving a problem, you've got so much more that you can get out of it, out of that problem being solved. And sometimes it's not even.
Anne Maghas
That's. I say it's not the lens. It's so much understanding the people. I once worked with somebody who was like a guy that was a single parent and that the perspective that he brought into it, and he was a single parent of a daughter, and every time we would talk, he had this very protective anxiety around things that I found. So whenever I was thinking, okay, we're not taking care of. If we're not taking care of every angle on this particular problem, I would look to him because I knew he had. That was almost a default stand for him. So whenever he was looking at a problem, he was always looking for where the risk is in a problem.
Anne Maghas
And he would bring out all that. He's like, oh, what about this? What about. And I don't even know if he was aware that's where he was coming from. But I became aware that he was my person that I would look to. To make sure that we've covered different risks.
Marcia Dawood
Yeah. Just because he had a totally different. He had totally different perspective from his vantage point, I think. I always think that's so interesting. The SEC advisory committee I'm on, we have such a diverse group of members, and I love the conversations that we have because everybody brings a different perspective.
Anne Maghas
Yeah, yeah. Yeah. And I think we underestimate. I want, I don't remember early on in my career, I worked somewhere and there was, I think it was like, it was an HR campaign that said, enjoy the difference. That was the campaign that they had. And back then, like, it didn't. I was like, oh, yeah, that's pretty. It was like cute purple colors and I love purple.
Anne Maghas
So I was like, oh, that's cute. But over time now, like, I honestly look at the difference and I celebrate the difference between all this different perspective that people have because we don't have the privilege to live different lives and have the wisdom from each of those lived lives. So when we work with people, that's how we get to benefit from the experiences that they've had.
Marcia Dawood
Yeah, that's awesome. And so what's next? What's. What are you excited about for the future?
Anne Maghas
I think now the thing that is circulating in my mind, like I've been enjoying doing one on one coaching and mentoring for founders, but now I'm starting to think again back to my initial point. Like when you are going from a founder to a CEO, and how do you scale that? Now I'm thinking, okay, it's good that the people that I've worked with have benefited from the mentoring and the coaching. Now I'm thinking, how do we scale that? How do we make that accessible and available to other people? And so I'm starting to think of how can we leverage the people that have already been coached and mentored so that they can be mentors as they're going, as they're doing their own thing at the same time, so that you're not just relying on us oldies. Oh, we're not here to mentor every generation, every subsequent generation. We can do this peer to peer mentoring. And how can we build a structure so that these founders that have transitioned to CEO can be mentoring others at the same time. They can build that capacity for mentoring for them.
Marcia Dawood
Yeah, I agree with you. If we had more people who were out there helping these companies, we wouldn't see as many of them struggle and in some cases not make it because they just didn't. Right. Support.
Anne Maghas
Yeah. And a lot of times, to me, some of the saddest company failures have been where people just, it was the way of thinking about it that got them to that point. It wasn't just, oh, yeah, it's easy to say, oh, they ran out of money and that's why they failed. But maybe they ran out of money because they only had this way of thinking about it. Had they broadened their thinking earlier on, they could have found other options.
Marcia Dawood
That makes a ton of sense. And thank you so much for being on the podcast today and giving us all of this great wisdom of yours, and we appreciate it.
Anne Maghas
Thank you. Thank you very much.