#131 Designer Fund: Building the World’s First Design Centric Venture Capital Firm | Ben Blumenrose, Co-Founder & Managing Partner

About Designer Fund

“What are you spending your nights and weekends on and is there a way for you to make that your job? Because that's the stuff that you're really into.” – Ben Blumenrose

Ben Blumenrose is Co-director and Managing Partner of Designer Fund, which is an early stage venture capital firm that backs founders that both recognize the power of design and are committed to getting design right from day one. Designer Fund was founded by Ben Blumenrose and Enrique Allen in 2012 after the two met at a program put on by Stanford's D school, where students use design to develop their own creative potential. When Ben and Enrique founded Designer Fund, there were few companies in Silicon Valley outside of Apple that understood the power of design to build incredible products, create a category defining brand, and ultimately forge an enduring company.

There were also no other venture capitalists with a pure design background. And yet, over the last decade Designer Fund has built an incredible venture firm. They've produced top quartile returns for their investors, beating out almost all of their peers in the market, and we're early investors in a wave of design-centric companies that have defined the last 10 years, including Stripe and Gusto. In today's episode, you'll learn why design is essential to creating great products that delight customers. Products that don't just check a box, but that set a new standard and aim to improve some aspect of their customer's lives. The role that design plays in developing, sharing and executing a shared vision. Including why designer founders are some of the world's best storytellers. How companies like Airbnb have made design a strategic focus and given design a seat at the table when it comes to making decisions at the highest levels. We talk about what separates the companies that get design right from those that get it wrong.

We break down Designer Fund's investment process and decode the algorithm they use to make investment decisions, including how Designer Fund has redesigned the way venture is done and created a rigid process to help them make the highest quality decisions.

For more, explore the transcript of this episode.

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Chapters

This episode is our definitive guide to building the world’s first design centric venture capital firm. In it we cover:

(00:00:00) – Introduction
(00:02:39) – The genesis of Designer Fund
(00:22:31) – Demystifying design
(00:28:28) – Traits of designer founders
(00:35:02) – Sweat the details that matter
(00:39:23) – The Designer Fund algorithm
(00:44:23 – Balancing skepticism and optimism in investing
(00:48:47) – Core qualities of great startups
(00:50:32) – How designers can add value as investors

Listen to the episode on Apple Podcasts, Spotify, Overcast, Google Podcasts, Amazon Music, Castbox, Pocket Casts, Player FM, Podcast Addict, iHeartRadio, or on your favorite podcast platform. You can watch the interview on YouTube here.

Our Favorite Quotes

Here are a few ideas we'll be thinking about weeks and months from now:

“Facebook's success created this giant magnifying glass on the people that worked there and people started reaching out for help on design. And it really opened my eyes to how absent design was in venture. These companies were getting started without designers anywhere in sight.”
“We need better designed products and services in the world. And when you actually zoom out at what's required to do that, there's a lot of things that need to happen. We need way more designers in the world. Two orders of magnitude, three orders of ... A lot more, right? Then we need those designers to be good at their job. We need qualified. We don't just need quantity, we need quality. So we need people who can do the work really well. Then we need ... Like you said, people are starting companies. They come from all sorts of backgrounds. Well, we need them to value design. And so they need to know that design is a superpower that can help your company win and do well. And without it, you're basically, you're hampered.”
“I think at the highest level design is the deliberate act of making something. And it's the deliberate act of making something with a purpose. There's supposed to be some utility when you're designing something. If it doesn't have utility, if it's for creative expression, that tends to be art.”
“ Everyone is a designer, whether they know it or not. So let's start with that.”
“In some cases, founders who value design that are not designers have actually done a better job of resourcing design than designer founders. Because I think they have the ability of saying I'm not a designer and I think it's really important.”
“The companies that do design well, they basically understand what are the important needs of the company right now and how can I apply design to those needs? And it's so basic, but you actually see a lot of people doing this wrong, which is the company needs to find product market fit and you have designers polishing a marketing site, for example, or polishing a product that they don't even know is the right thing to build.”
“For any designer listening, you should be spending a lot of time recruiting for your company. It's another thing that a lot of designers don't spend enough time recruiting other designers. That's a really impactful thing to do because once you get another designer in there early on, has a huge impact on the output of the team.”

5 Ways to Dive Deeper

Want to dive deeper? Here the best content we've curated on this subject:

The Ultimate Guide to the Founding Designer Role: This fantastic resource from First Round Review outlines how to set up, fill, and fulfill the designer roll for startups.(42 Min)
Startups, this is how design works: A quick primer on startup design for non-designer founders. (16 Min)
aidesign.tools: This site curates articles from around the world centered on AI and design. (10 Min)
What Is the Role of an AI Designer?: Written by the Director of Product Design at Facebook, this quick read points out a few ways AI designers can benefit businesses. (6 Min)
Will DALL-E the AI Artist Take My Job?: An interesting take on competing with an AI designer. (15 Min)