Tonya J. Long: 0:03

And welcome. We are at the top of the hour here at KPCR LP 92.9 in gorgeous Los Gatos. It's going to be 75, 78 degrees today, beautiful blue skies, and my beautiful friend from LA has joined us in the studio. I am so excited to welcome Belinda Ephraim to Reset with Tonya Now.

Tonya J. Long: 0:27

We talk about transitions and resets here, and Belinda is remarkable. She has the distinction that a lot of us don't. She grew up in a whole different continent. Belinda grew up in Nigeria and from there she came to the US and we'll talk about her story. But she worked 16-hour shifts at Marriott before. Are you ready for this?

Tonya J. Long: 0:50

Before she structured over $37 billion in M&A activity as an investment banker. She's remarkable because of the journey that she is still on. So she went from $37 billion in investment banking M&A activity to then getting more creative and opening her own cosmetics company. She became a chemist and then from there she's now a VC, building a deep tech venture capital fund and doing fundraising for that. So her journey has been tremendous. I am blessed that she's here on the West Coast, even though she's a five-hour drive away, but today she is here in the studio in Los Gatos. Belinda, I couldn't be more happy to see you. It's been too long. Tell us about your current priorities. What are you working on now? It's always a surprise with you what new things are coming your way, thank you for having me, Tonya.

Belinda Ephraim: 1:44

This has been an amazing moment, full circle moment for me when I think about my life and also my career track over the years, and one of the things that I'm really focused on right now is taking all of those experiences and really culminating them into this venture capital firm. So right now, it's really taking my experiences over two decades now and culminating into Tonsua Capital, which is an industrial deep tech venture firm that I am starting as well as fundraising for. So we're fundraising. We are looking to raise $50 million for our first fund and that capital will be deployed into 15 to 20 investments in the industrial deep tech space. So that's what my focus is on right now.

Tonya J. Long: 2:44

Tell us about TENSEUR. I took French in high school, so I have to embellish it far more than the French would be happy with. But TENSEUR, where'd the name come from? And tell us about the industry that you are focused in, because I find that interesting. You know, I'm in this tech bubble here where everyone is focused on the latest AI wrapper right and you're going after big whales. You're going after large capital, large like supply chain. Are you buying ships and containers? What are you focused on with Tensoir?

Belinda Ephraim: 3:21

I love that and the French would be thankful for the embellish. I love that and the French would be thankful for the embellish. I love it. So tensoire is really French for tensor and tensor is mathematical. It could also apply to computer science, deep learning, machine learning, but it really is the multidimensional array of data so that data can be applied to vectors, scalars and any other sort of mathematical algebraic expressions Multidimensional, so anyways. So that kind of is the definition, because the way I see the firm is really as a, so the legal name of the firm is actually TENSEUR Capital. It's a vector, so the space, and then the collective are all of the different constituents from myself, investors, primarily founders, our scientific council advisors, so in other words, the vision that I am thinking about implementing and building this platform. So it's not just a first time fund. I actually want this to get to a billion dollar plus type of VC firm focused on industrial, deep tech. So industrial, because my background throughout the years have been investment banking and growing up in West Africa, nigeria, west Africa. My father was a civil engineer and my mother was a scientist on the geological side, plant science, and then my father was in oil and gas early in his career, and so he was one of the young engineers that were hired by oil companies at the time after Nigeria gained independence and coming into Nigeria to obviously take advantage of the resources that were available, and so he was part of the team that actually built out one of the longest gas pipelines in West Africa At the time it was called the Transfacando gas pipeline and so he's an engineer, my mom's a scientist, growing up a building products manufacturing company, and so I grew up understanding things like sanitary wear, what's a closet bidets, and having to see my parents literally start this from scratch, so that industrial sort of insight from the entrepreneur's viewpoint, because I think a lot of times we VCs think we understand what it is to be an entrepreneur, and it's an extremely difficult personal journey, thank you. And so, growing up in that atmosphere, I understood what feast famine. I also understood what it took to build a business, because I saw my parents build it from scratch together. At the time in the 80s. They would travel to China. China was not producing anything at that time, but they would travel to China to the districts that actually had a lot of the marble quarries, and so that's where they would get some of the raw materials, the powders, the resins that they would need in order to put together this chemical. And then they would source some of the other raw materials from Europe. So Italy, the equipment was from Italy and they'll put all that together. And so, growing up in that and then, obviously, my journey, I got into investment banking and when you first start with investment banking, they kind of assign you your group right, because based on the bank's needs and where they need people. And so the first thing that was assigned was industrials group and I was like what is an industrials group was industrials group, and I was like what is an industrials group?

Belinda Ephraim: 7:25

Industrial sector is actually one of the largest sectors that contribute to the US GDP and that encompasses manufacturing, processing, transportation, aerospace, defense the things behind the scenes that we don't see as consumers. That's the industrial sector, so the movement of goods and services to get to the customer. So that was where I cut my teeth working with Fortune 500 companies on their deals. So naturally, the size of the transactions that I worked on were larger but unsexy. Do we not consume a product? So when I would tell my friends, oh yeah, I worked on CXS, which is a massive transportation company, and it's like daring headlights, like they don't know what to make of it. Or if I said Lockheed Martin, like they wouldn't understand that. And so it was a space that I really wanted to own, and that's really why I like the industrial piece.

Belinda Ephraim: 8:26

Now, the deep tech piece is when I look at where we are today and I look at the technologies moving forward and I look at my experience, one of the things that I realize is I want to play at the frontier of these technologies, but I didn't want to do it as an enterprise, saas, vc type of firm because I had to.

Belinda Ephraim: 8:52

So I think maybe this is maybe I'm jumping ahead here to some of the things that we've, but after I wound down my company, my startup, my manufacturing startup, I took about a year and a half to really consider what my next move was going to be, and when I decided on becoming a VC, this was something that was important to me and I decided okay, what segments of the market or where do I feel I can bring the most value? And I realized that a lot of VCs don't know how to underwrite and or evaluate deep tech companies, and these are companies that primarily either hardware so hard tech combined with maybe some software or some key enabling technology that can revolutionize their innovation. So that's where I decided to play, because it really fit my wheelhouse and how I see myself contributing to the founders that we support within the collective.

Tonya J. Long: 10:06

Excellent. So to me, what's interesting about you? You had a cosmetics company and now you're looking at these. Deeply technical, you're looking beautiful, good, so you're looking at these. We have never had so many.

Belinda Ephraim: 10:27

We're just gonna laugh about it, because that's this is shown. This is exactly how this is life.

Tonya J. Long: 10:33

This is life. And now that you are on a mic and I am on a mic, but it's not about editing, it's about engagement, right? You and I both, yes, and I think that's why you've moved from big tech, from big enterprise systems, to cosmetics, to get more personal, and then now back into deep tech. Not just big tech, but deep tech, because it often starts small but very, very niche, very, very complex, and you have to dig in. So clearly you've got the brain bandwidth for that.

Tonya J. Long: 11:02

I do I want to go back to when you were in Nigeria? And then you how old were you when you moved to the States?

Belinda Ephraim: 11:10

So, for context, I was 16 when I moved officially to the States. Prior to that, my parents, we always traveled as a family. Well, yeah, yeah, we always traveled as a family. We had homes in London, yeah, so we had a home in a flat in London.

Belinda Ephraim: 11:25

We always traveled as a family. We had homes in London, yeah. So we had a home in a flat in London, we had a home in the Florida Keys, and so we would take three months out of the year and literally do the loop, the loop, nice, and maybe we might pick an extra European country Brussels or Amsterdam or something like that in between. So my familiarity with America was like from a tourist perspective.

Tonya J. Long: 11:50

Yeah From a oh mom dad. This is great. We're going to Florida to hang out with the alligators. Can I see an alligator this trip?

Belinda Ephraim: 11:58

Actually, no, it was more like oh, we get to eat bacon and eggs oh geez. We get to eat the American breakfast.

Tonya J. Long: 12:05

I. We do have good breakfast here. Eggs oh geez. We get to eat the American breakfast. We do have good breakfast here because I've traveled extensively through Asia and they hand you a hard boiled egg and some raw fish and they call it breakfast and I'm like, no, this is not breakfast. So we do have good breakfast here. I love that.

Belinda Ephraim: 12:20

That's what you remember enjoying yeah, I remember enjoying that and a couple of the other things we could get my dollhouses, because I used to love building dollhouses from scratch as a young child.

Tonya J. Long: 12:30

I made my mama a dollhouse when she was like 55. Oh wow, and that was a really special memory. It's like building a great big mansion on teeny, teeny, tiny scale, and I can see why you I didn't know this about you, but I can see why you would have built tall houses, because you get to do the whole thing in a matter of weeks or months.

Belinda Ephraim: 12:51

Yes, and that was really my childhood growing up, my childhood growing up. We're six kids and I was a first girl, first child. Oh geez, yes, I know. And but after me were two boys, and as a girl growing up with two boys, it was either play with them or learn to be on my own. I had to learn how to do both equally well. That's remarkable, yeah, and so I never had dolls. I didn't even know what a Barbie doll was.

Tonya J. Long: 13:17

You had a full-scale house.

Belinda Ephraim: 13:18

I had a full-scale house, one thousandth of normal size, exactly One thousandth of normal size, and so I was always excited about receiving dollhouses to build from scratch with the little pieces. It would come in a bag and literally I would have to build it. And my father? I remember Elmer's glue, so I love the smell of Elmer's glue. So those were the things that made America for me.

Tonya J. Long: 13:38

So did you not have Elmer's plain white school glue in Nigeria? Was that a rare thing, yeah?

Belinda Ephraim: 13:46

we had our local glue, but we wanted to use the glue that came with the dog.

Tonya J. Long: 13:52

We are so far off script right now, I know, we really are.

Belinda Ephraim: 13:56

I love it, I do, but sometimes that's the magic of this podcast, and anyways. I wouldn't know this about you. Then all the work stuff that we do. I've always been a builder. Yeah, always been a builder yeah.

Belinda Ephraim: 14:05

Always been a builder, yes, and then I love action, marvel, comics, things like Spider-Man and Flash Gordon and things, because I had to hang out with my brothers and I had to learn how to climb trees. So it wasn't until five, six years that my sister came and then they started playing with Barbie dolls and I was like what is this? Yeah, no frame of reference. So anyway, to answer your question, I was acclimated. But when I was 60, because I had graduated from secondary school back home, so I got my, I think, what you guys we call it a WIAC certificate, you guys call it a high school diploma. Oh, okay, yes. And my parents were like, okay, we want, obviously, they're building this industry. And so they said we want our children to go to school in America at the time, and so where your parents say to go as an African child is where you go. Right, there is no, it's like that in the States too.

Tonya J. Long: 15:03

When you're a kid. You don't have a lot of agency, you certainly don't have budget. You're dependent on those adults to make sure you get fed, clothed, all the little things. So, from that perspective, the things that matter more than the Barbie dolls, exactly.

Belinda Ephraim: 15:17

Here in this country, when you are a high school student, you're planning your college, where you're going. So then you go to 10 different schools, you interview, you do all this. There's this whole process around going to college and then deciding on the college, whereas for us, that's not how it works. Just here's where you're going to go, and that's it. Which was fun with me, because I loved America so much and I was like, oh yes, I'm going, and you had the support of your family and I had the support of my family.

Tonya J. Long: 15:47

A lot of people in your situation. The support also.

Belinda Ephraim: 15:50

The business was successful, so my father could afford to send me to school here.

Belinda Ephraim: 15:55

Two years fast forward, two years. I was turning 18. And due to the political situation back home, so, the way back home, I was here in America, the political situation back home, so they were back home. I was here in America and all of a sudden there was a coup and they had to flee the country. We don't have that much here, yeah, thank God. And I think this is where sometimes, when we look at the current climate and people are complaining and whether it's this president or a Democrat president or whatever the case is I just keep my head down because I'm like you guys have no idea in this country how privileged and blessed we are. It has been very stable, yeah, it's a very stable country, despite the short-term hiccups. So when I think about my experience and seeing my father and my mom and my sisters and everybody now having to flee our homeland, so with nothing, this is when you were 18. This is so. Imagine I'm here in private.

Belinda Ephraim: 16:55

OK, let me just give you context because I think people don't understand this. It's I came here to this country. We flew first class to get here. Ok, we had a home in the Florida Keys. My father sent me to private school, paying cash. This was not a loan, this was not paying cash for me to go to a private school here in America. And because there is a dream, there is a vision, and then, two years after, so I'm about to become a junior in university. Okay, you were at junior in university.

Tonya J. Long: 17:25

Okay, you were at your junior year. Yes, junior year, third year in.

Belinda Ephraim: 17:28

I'm about to get into my junior year and all of a sudden, I can't do that. I have to drop out. Oh wow.

Tonya J. Long: 17:35

Okay.

Belinda Ephraim: 17:35

Because they had to flee to this country and seek political asylum, and so because of that. Everything got shut down Talk about overnight, and so I had to step back and really step up.

Tonya J. Long: 17:52

Yes, Adulthood came quickly.

Belinda Ephraim: 17:55

Oh yeah it definitely came at the age of 18. Yeah, yeah, and so I had to help my family to help my family. My parents, at the height of their career, came here to this country and were delivering newspapers. My dad was in his 40s. My mom as well.

Tonya J. Long: 18:17

He was delivering the paper in his 40s.

Belinda Ephraim: 18:19

Yes, and that's so humbling.

Tonya J. Long: 18:21

When you've had everything you wanted, and then you're doing the job that typically is reserved for teenagers, or even younger, on a bike, even younger on a bike.

Belinda Ephraim: 18:31

Yeah, yeah, back in the day, but he and my mom that's what they did, yeah, and then finally he was able to get into like an engineering position, because, again he had the education engineering position because again I had the education. My mom ended up having to work at a CVS just so we could all make ends meet, and then I ended up having to work as well. So I ended up working three jobs, starting at Marriott, and so 16 hour shifts, and what that meant was so, again, I'm very smart, I think I'm smart, I know what I know, but I don't know what I don't know. And so over time I had three jobs in three different locations, and so what I did was, as each position became available within the same company, I applied and I got in. So I had three jobs in one hotel, one company. So then that way.

Tonya J. Long: 19:26

Oh, you were efficient as well. I was efficient, yes, because I know a lot of smart people who are not efficient. We've worked with those poor souls, right. Yes, I'm so in awe and admiration of the resilience that you've had an opportunity to build, as you've been a businesswoman here now for a long time, upwardly mobile and successful. What do you think you learned growing up in Nigeria that differentiates you? I?

Belinda Ephraim: 19:52

think the first thing was at the age of 10, I was sent off to boarding school. So I was sent up to an all-girls boarding school, and not the Switzerland kind, okay. So an all-girls boarding school was founded by the missionaries that came to Nigeria pre-independence, and so these were female missionaries who were all about girl empowerment, and so they built secondary schools across the country federal government girls' college secondary schools in different states and that's when my parents decided to send me to school. So while in the school, imagine at 10 years old you are given a plot of land, so you form your land with a cutlass. At what age? Machete, 10. Okay, because it was all about in hindsight I thought it was punishment, but that's just the way any manual labor seems to a 10-year-old.

Tonya J. Long: 20:53

Exactly yeah.

Belinda Ephraim: 20:55

But I realized in hindsight it was really about self-sufficiency. When you go out into the world as a woman, can you figure it out? Can you survive Because you're as a woman, can you figure it out? Can you survive Because you're not a man? Men, inherently boys. They should be able to do these things.

Tonya J. Long: 21:12

But they have your brothers in the laundry room learning how not to bleach the colors.

Belinda Ephraim: 21:18

My brother actually had to also go to his version of the boys' school and learn how to take care of himself.

Belinda Ephraim: 21:27

That didn't really go so far, but for us it was okay. Learn how to do your laundry by hand, because there was no washer dryer, right. So it was all of these things that I learned as a child, and I did that for six years. It was if the water supply in the borehole didn't carry water into the dormitory, then I had to go to the next. All of us had to carry 10 gallon containers 10 gallon and that's heavy, and that's heavy and go downhill to the next village. Your resilience was earned and carry water on our head.

Tonya J. Long: 22:07

You have one on your head.

Belinda Ephraim: 22:09

You have your two hands, yep. So when I walk straight here in America, people think I'm arrogant. I'm like no, I had to learn to walk straight because I had to carry water. Here in America people say catch, what is it? Carry, chop wood, carry water. That's an African saying, because nobody who ever says that quote understands what it is to chop wood and carry water.

Tonya J. Long: 22:34

I think that's what makes you and I alike. I don't see you often enough, but I worked in the tobacco fields with the men and I helped the women bring in. They called it dinner, but we would call it lunch. It was the midday meal and then I cleaned up the mill and then I went back out in the fields with the men.

Tonya J. Long: 22:52

I chopped wood so that we had heat during the winters and in Tennessee it's very cold, and so we all have wood-burning stoves back at that time. And so it would be my uncles and my dad and my brother and me up on top of the hill and they would toss logs to me off the back of the truck because I was probably like nine, 10 years old and sturdy I've always been sturdy, that's my way of saying pudgy and they would like literally lob the tree trunk cuttings off the back of the truck for me to stack. And they were playing with me, they were teasing me, but I think it's that learned experience that you and I both have. That is pretty unique and it does teach resilience.

Belinda Ephraim: 23:33

It teaches resilience. And then also when you get to the top of. So in my case, when you, after you fetch your water and you get to the top your water, and you get to the top, about to enter your dormitory, all the senior girls are lined up. Oh, waiting for the junior girls who just went all the way down to the next village. So you were taught hierarchy.

Tonya J. Long: 23:56

Oh, If you For you out there on radio land, the look she just gave me was priceless.

Belinda Ephraim: 24:05

I mean you have no idea and literally they would take cups of water from each junior girl because they did not want and they did not feel that they had to go down to that village to get water. So by the time you get to dormitory you have a quarter after your $10 plus your one, plus your buckets. You have no water but you have to take a shower the next day and you can't go down, so you had to be smart.

Tonya J. Long: 24:38

You had to figure things out. You had to figure things out. That translated to working three jobs in the same hotel, exactly Just a few years later.

Belinda Ephraim: 24:44

Just a few years later. Yes, but when it came time for me to, because I didn't understand how, what the benefits were, but when it came time for me to put, I guess, the metal, the pedal to the metal, or whatever you guys say, then that's when the pedal to the metal, the pedal to the metal.

Tonya J. Long: 25:00

I'm here to help, thank you. We'm here to help.

Belinda Ephraim: 25:02

Thank you, because the grains just grew up it grew up the same.

Tonya J. Long: 25:09

But that's really that was the foundation of who I am, of course, and it guides everything that you do.

Belinda Ephraim: 25:14

Yes.

Tonya J. Long: 25:14

I'm going to take a little segue point. We are at the part of the show where we give back to the community for just a minute, and we've talked about being 10 years old and chopping wood and hauling water. It's a little different here in the Bay Area and what I have to offer is our radio camp for a little bit older. We're looking at 13 to 17 year olds. Camp starts on June 9th and I think that there's no better way for teenagers to learn speaking skills. It's focused around learning to be on the radio, which is cool and different, but also we'll be teaching podcasting, and so I think there's a ton of teenagers that are interested in having their own podcasts. So kpcrorg, the website, has more information about Radio Camp that starts in a couple of weeks. It's June 9th is when it starts, and if your children would be interested in that just or you would be interested in that take a look. But we're focusing on 13 to 17 year olds and I think we're going to have a bunch of interesting podcasters come out of that.

Tonya J. Long: 26:13

So this is KPCR LP 92.9 FM in Los Gatos beautiful, sunny blue sky, los Gatos and KMRT LP 101.9 FM out of Santa Cruz, and I can only imagine what the beach looks like today Glorious, don't you know? Because it's a gorgeous day. So let's we've talked about how you built resilience let's look at how you built the multiplicity of who you are. You had to work in a hotel because it was it was very much a starter job, I get that. But then you went from there into investment banking and put together $37 billion in M&A, so before I got to investment banking actually.

Belinda Ephraim: 26:53

So one thing I learned I guess my father really espoused to us children was education was everything for us, and especially a lot of Africans. When you meet an African here in America or anywhere else in the world, we are probably one of the most educated citizens of the world because we know that without education we can't really be much of anything. When I was working as a front desk agent in the hotels, I actually decided to take a quick course at the local college.

Tonya J. Long: 27:32

Because this was at a time for those who are listening, who don't understand that when she couldn't just get on the internet because you look young, but I know. So there was no internet at the time for classes.

Belinda Ephraim: 27:44

For online classes. Yes, there was no internet at the time, and I think thank you for bringing that up, because I think the internet is really what, and this is why I want to be where I am with my fund. So I took a class because I wanted to. This was the third job that I was going for, which was a night auditor job, and I didn't know accounting, or at least how it should be done, so I took a night course at the Naval base, and that's how I ended up getting that job now. So now that was my third job, but so I took what I learned in numbers and consolidated three jobs into one as a wealth analyst or wealth management analyst. It's that job that I made. So, all of a sudden, I was making the equivalent. So the dots connect, so the dots are connecting, and then so, during my time there, I learned a lot about wealth management, about stocks, bonds, at least just fundamentally, and this was during a time that the AOL Time Warner merger was going on.

Belinda Ephraim: 28:58

And I think it was almost simultaneously with the Hoxha Simpson trial, I think. I'm not sure, but I didn't have a TV in my home and so when we get to work, the CNBC was on and this was the glorified IPO of its day. And I said to myself I said, wow, I don't know what those guys are, but that's what I want to do. Literally, I said that you wanted to build those partnerships.

Tonya J. Long: 29:26

However you look at an M&A, you knew that from looking at CNBC when you would go into work. Yes, that was something you wanted to be part of, yeah, Okay.

Belinda Ephraim: 29:33

And so I said, okay, what do they do? What are they called? I had no idea what they were called. And so I did my research and I was like, oh, this is exciting business. And I was like you know what? I know that the reason my father's business failed was primarily because of the political regime. However, when I look back, I'm like, okay, why wasn't he able to restart the?

Tonya J. Long: 29:58

business.

Belinda Ephraim: 29:59

It's good to ask these questions but, it's one thing to say, oh, this was why, but then it's okay. What was the other thing? And I realized that when you are in an environment that doesn't value businesses, that the policies, the procedures, the way the central bank is structured doesn't support the flourishing of entrepreneurship, the true flourishing of entrepreneurship then that's a problem, and so as I started to research, but to be fair, it was also just an immature.

Tonya J. Long: 30:29

I don't mean that disrespectfully. It's just not a mature ecosystem to support Correct. It's amazing what 22-year-olds can do now.

Belinda Ephraim: 30:37

Yes.

Tonya J. Long: 30:38

Because they're surrounded by support, infrastructure, systems and tools that enable them to do things that your father did not have, the luxury of, he did not have any of that at all.

Belinda Ephraim: 30:50

So when I started to research what M&A investment banking was, I was like you know what, if I really want to understand business, I need to understand money, and I need to understand how these people are able to get a couple billion dollars or whatever price at that point in time in order to effect this transaction. And so that is really what drove me to get into M&A. I have an interesting story about how I got into that, but for the sake of time, we'll pass that. But that's how I got into investment banking.

Tonya J. Long: 31:21

How long did you do investment banking? Two years, 10 years.

Belinda Ephraim: 31:24

I want to say a total of 10 years. Five years was mostly mergers and acquisitions, and then the remainder of five years was like infrastructure finance, so financing instead of corporation. You're financing real assets, so affordable housing, and then that's how I got into hospitality again.

Belinda Ephraim: 31:45

But this time there was something called revenue management. It's a new discipline that hotels are starting to implement, similar to what airlines do from a pricing strategy perspective. And so when I got in and I said, oh, what's revenue management? And at that time no one was really doing it, but because, remember, I come from Wall Street, I understand finance, and so all of a sudden I was like, oh OK, I think I like this, I don't want to do night auditor.

Tonya J. Long: 32:14

I've been there, done that. No, thank you. You weren't going to be a 60-year-old night auditor one day.

Belinda Ephraim: 32:19

No. And so I said no, I don't want to do that. I want to do this revenue management. I want to learn something new. But then I realized that it was much more complex. It wasn't just about pricing strategy, it was about marketing. It was about sales. It was how do you drive a customer all the way to booking a hotel room and all of the things that go behind it, to booking a hotel room and all of the things that go behind it.

Belinda Ephraim: 32:43

And then this was what was cool and what made my experience in that special was the idea of something called new hotel openings. So when hotels are being opened, there is a whole strategy behind that encompasses the branding, the marketing. And so I found myself in this unique place where I wasn't just going into hospitality revenue management, but I was actually opening new hotels and doing the revenue management layered on top of that. So I learned fast. I learned and oh, and it was in a cluster, what they call a cluster. So what will happen is that hotel owners will buy a cluster of properties. It might be a mix of Marriott, hilton and an independent brand, and so that's really where I learned how to different systems and all of these different aspects when it came to revenue growth.

Tonya J. Long: 33:43

You've dealt with numbers, you've bought companies, you've merged companies, you've worked in multiple verticals and now that you're working with Tensois, now that you're building Tensois and now I love saying it I wasn't sure how to pronounce it before you got here, but now that you're doing that, you're pulling from the end of setting up these environments to eventually be acquired. It is a good thing to build a company that's worthy of other people paying to own it. Correct, and so you're building that. And on LinkedIn, a few weeks or a month or so ago, you said venture capital is powerful but wrong for many startups. Now, why would you say that? Because in this town, everybody is chasing the VCs. I feel sorry for us because everyone wants to raise money, and I think it's actually very brilliant of you as a fairly newly minted venture capitalist. You are how dare I? But how dare you like look wrong at the brotherhood and say Our voices on the screen behind us are going totally off the rocker.

Tonya J. Long: 34:52

I love it, but this is what happens when you get connection. But I think it's really worth a conversation to talk about why. And it's not so much. I think it's a bigger life lesson. It's not about venture capital, blah. It's about not every solution is a fit for every challenge, correct, correct, okay, that sounded good for me. Tell me what the reality is. Tell me why you said venture capital is a strong opportunity, but it's not the right fit for every startup.

Belinda Ephraim: 35:21

Yeah, and I probably would say 90% of startups.

Tonya J. Long: 35:24

Oh wow, you got skin on the game. On this, I am so pissed.

Belinda Ephraim: 35:28

How? Because of this fundamental fact and I realized it when I founded my manufacturing startup and so when I understood the math a lot of startup founders do not understand the math that drives VC firms. Yeah, they also do not understand that when you look at a cap table, any capital structure and remember I did this for a living equity is the most expensive, the most expensive cost of capital.

Belinda Ephraim: 36:03

And so when you look at the fundamental math of traditional VC, it does not align with a lot of startups, regardless of the technologies, regardless of whatever it is that you're building. For example, let me I've actually wrote this down because I need to there's something called, if you look at the fund structure and the lifespan of a fund, not the firm of the fund usually it's 10 years, right? 10 years with maybe two one-year extensions. And so when you have that and your investment period as an investor is maybe three to five years, so the first three to five years of your fund is when you're making your investments into startups. So timeline. So by year three you should start technically exiting some of those investments. So then that way, by year 10, you close your fund.

Belinda Ephraim: 37:22

The reason why there are two one-year annual extensions is because for any kind of, maybe there's a company on the books that maybe needs to stay longer, whatever the case is. So that's the fund structure and the lifespan, and there's something called power law. Power law says, or states, that if I have a portfolio of 20 companies, only two of those companies should return my fund. Remember, it's a fund You're supposed to return.

Tonya J. Long: 37:49

Spreading the risk across multiple purchases. Most of our audience are not in this space, so this is not something they're going to go deep on.

Belinda Ephraim: 37:53

No, they're going to spread that risk. So only two companies out of 20. So if you're a founder and you collect this money, the expectation is that you should return 10x at a minimum and it depends on the fund size. So if you are not a go big or go home kind of founder, like someone like Sam Altman- Sam.

Tonya J. Long: 38:23

Altman just for those who are listening, he is the CEO and the golden child of AI. He's the CEO of OpenAI. Openai, or Larry Ellison.

Belinda Ephraim: 38:37

The CEO of Oracle. You know those, steve Jobs it takes.

Tonya J. Long: 38:42

He has passed and CEO of Apple now.

Belinda Ephraim: 38:44

No, no, no, but these are big players.

Tonya J. Long: 38:47

These are big players, and the average startup is not a big player. They don't even know what it means yet. They don't even know what it means yet.

Belinda Ephraim: 38:56

And their vision. They're not the ones who can take this company to where it needs to be. They're not a Steve Jobs. They're not a ones who can take this company to where it needs to be. They're not a Steve Jobs, they're not a Sam Altman. So the founder mentality does not match the capital, and so there's a misalignment with expectations. And then the founders think, oh, I'm going to build this to a $20 million company, for you just received capital from Sequoia. Sequoia is a multi-billion dollar fund, so if they're going to invest in you, you had better guarantee that they not only get back their investment, they get back 10 times that money.

Belinda Ephraim: 39:38

And so if you're not that founder who can produce a multi-billion dollar company in five years, then you should not be at the table, and that's really what it comes down to. So that's why I say it's not. There are excellent businesses. I'm not saying the business is not good, but you have to understand that capital source, the expectations around it expectations around it, and so when these founders get into these companies or firms as a portfolio company, they wonder why isn't the VC giving me the all?

Belinda Ephraim: 40:09

Why isn't the VC giving me the resources I need to grow my company? Sorry, I can focus on the unicorn.

Tonya J. Long: 40:19

This is not the grandfather model. It's not so that's why so?

Belinda Ephraim: 40:23

that's, and I think that. So that's why I say what I say.

Tonya J. Long: 40:25

But they do take fingers. They do take fingers and that's why the mafia sense yes.

Belinda Ephraim: 40:31

The mafia sense.

Tonya J. Long: 40:32

The story that that I work with lots of founders and and I have this talk with them why are you chasing VC money? Yeah, and I've told almost all of them and it feels like so, it feels like telling someone to breathe, because it's so common sense to you and I. But I tell them the stories of the founders who have 40 and 60 million dollar exits and they might pull two or four hundred thousand from that for themselves after they finished paying, paying everybody else, and to have a $40 or $60 million exit and then what you get is the Bay Area equivalent of a year's salary maybe a year and a half and you killed yourself and your family and your life for years and years and you get basically the equivalent of a year working in an executive role in the Bay Area and they do this three times, they're doing it multiple times and I'm thinking I don't understand it.

Belinda Ephraim: 41:28

I'm not understanding why this is not working. Yeah, because this is a fundamental.

Tonya J. Long: 41:33

This is a reality, this is a myopia. Yep, yep, it is so. Vc funds are not the be-all end-all. They should not be the only way that you monetize your go-to-market funding capacity.

Belinda Ephraim: 41:47

I want to give a case study because I'm actually anyone who's listening, who knows the founder, CEO and founder of Atlassian?

Tonya J. Long: 41:54

Atlassian is a very good company based here in the Bay Area, and Australia right Australia is where they were founded.

Belinda Ephraim: 42:00

Yes, that is a fascinating case study. That is a case study that, when I so, I did and let me just quickly go through this I did an interesting research and I said if I was interested in investing in enterprise SaaS, the founder that shows up at my door has to meet this criteria. Because I want to, I want 10, I want 10, I want 100, I want 1,000 Atlassians.

Tonya J. Long: 42:28

So what made Atlassian a special investment?

Belinda Ephraim: 42:31

So they were founded in 2002.

Tonya J. Long: 42:34

Okay, so they're roughly 20, 22 years old, correct.

Belinda Ephraim: 42:38

Guess when they went out to get VC money.

Tonya J. Long: 42:42

I don't know.

Belinda Ephraim: 42:45

They got VC money in 2010.

Tonya J. Long: 42:48

Okay, so they operated eight years.

Belinda Ephraim: 42:51

Eight years. It took them eight years to get to $50 million. There was a game plan. You have to have a game plan. You have to have a game plan. You cannot go to VC money and say here's my idea and expect that they are going to VC. Money should not be operations money. A lot of startups use VC money to operate their companies. They had revenue and they were profitable when they decided to go to VC. They took VC money to grow. Let me tell you.

Belinda Ephraim: 43:23

You tell me revenue and they were profitable when they decided to go to VC, they took VC money to grow To VC.

Tonya J. Long: 43:25

Let me tell you so you tell me no.

Belinda Ephraim: 43:29

I was like I'm picking it, you know why. So this is the thing with data, peter Walker.

Tonya J. Long: 43:33

Yes.

Belinda Ephraim: 43:33

On LinkedIn Peter Walker.

Tonya J. Long: 43:35

Carter Carter Data Insights yes, awesome. He's great. A great storyteller with data.

Belinda Ephraim: 43:41

Very great story A year ago I think he had posted for SaaS companies Obviously a SaaS person right Focus on deep tech. He had posted this SaaS company's, I think, ownership at IPO and every other company was like below the 30% line. Remember, this is founding team ownership at IPO and I kid you not, I was like what is Atlassian? All the way at 75% and I asked it in the comments and no one could tell me why. And that bothered me Because if there's anything I've learned in investment banking, it's not about trends.

Tonya J. Long: 44:24

Trends are average, the anomaly. That's a very wise statement.

Belinda Ephraim: 44:28

Yes, trends are average. Trends are average. The anomaly are the winners, and so I said that's important Good. Are they doing? Or what did they do? That's crazy. And because we talk about this 40 million or 400, $400 million, the founder maybe gets $40,000 as a net payout. What did they do? This is what they did.

Belinda Ephraim: 44:50

They proved their business model. They were generating crazy revenue and, when it comes to enterprise, saas, they priced that thing so low that it was scalable. It's all about scale, but you have to price a lot of enterprise companies, saas companies. Now they're pricing something like who are you pricing for? Are you pricing for a Fortune 100 company or are you pricing for the small business down the street who really makes up America? The disconnect is not there and they can't scale. That's why they can't scale. It's not because they're not going after the right customers, or should I say it's not because they have the wrong product. They just don't understand how interesting. They don't understand they chase Fortune for $100,000, but it's really for middle America Made Atlassian successful. Then in eight years, on their own, they got to 58 million. So they got that VC money and they literally quadrupled in three years Okay, quadrupled their revenue, got it In three years, and that's when they went IPO, got it.

Tonya J. Long: 46:01

So you said three years from VC to IPO.

Belinda Ephraim: 46:03

So when they first did the first seed late stage seed because they were already a performing company, so they had to target growth and seed farms and so from $58 million in revenues. Then they did a secondary. So the initial investor wanted to get out, but not in a bad way because of the IPO, and so they were able to triple their revenues, to actually quadruple to $215 million three years, about three, four years later. And then the following year was when so not even five years. So in five years they were able to go to revenue from $58 million to $320 million. That is what VC money is for, okay.

Tonya J. Long: 46:57

Let's transition. Yes, let's transition. We need to transition, so we'll do a quick station ID first. We are at KPCR LP 92.9 in beautiful, sunny, glorious Los Gatos, also with sister station KMRT LP 101.9 out of Santa Cruz, and KPCR 92.9 has just introduced and I am a proud member of the Signal Society we are a public radio station, which means we are funded by users who want to keep listening to us and I think this is a novel new approach that the station is taking so that you can buy memberships in the station.

Tonya J. Long: 47:35

It starts at $5 a month $5 a month to listen to Belinda and I messing up our microphone and trying to figure out how to engineer those but to really interesting eclectic music and other genres of interviews, and it starts at $5 a month, moves to $10 and $25. As you go up the ladder you get merchandise. You get a member card if you're local to Los Gatos, so you get discounts on wine and donuts and maybe oil changes, I don't know. But we're building up the companies that are helping KPCR by bringing business to you that's discounted from them. So, anyway, the Signal Society you can get to that on kpcrorg and I think it's a neat program for listeners to support and be supported in being part of this community. So let's talk about being part of a community and that means podcasting One of your transitions. Six or seven months ago I was your third guest on your Neo-Industrialist podcast and you schooled me on a few things about AI. It was great. I think we talked an hour and 45 minutes. That day.

Tonya J. Long: 48:48

It was pre-recorded and unlimited and and we had the longest best conversation. What got you interested in shifting, with all that you do, into building a community around a podcast on neo-industrialists.

Belinda Ephraim: 49:05

So the neo-industrialist, so it was titled a different podcast, obviously at the time because I was thinking, ok, maybe I'll just go back into M&A, yeah, which is a natural thing to do. But then I realized, for you just, go back into mergers and acquisitions? Yeah, no problem.

Tonya J. Long: 49:23

I'll call somebody up, yeah.

Belinda Ephraim: 49:25

So, but I realized during that time that, like with everything else in life, when you're starting something, you used to tap into your network yes, and I didn't really have a network of business owners and so I was targeting and because of that I was targeting baby boomers- that was your target market.

Belinda Ephraim: 49:48

That was my target market because it was the lower middle market, and especially as an individual advisor. That just made sense. The problem is I'm very tech-oriented, did you say. The problem is yes, oh, that's not a problem. The problem to the customer I was targeting is that I'm very future-forward thinking yes, and so I did not understand why in 2024, 2025, why in 2024, 2025, why these small businesses weren't really incorporating any kind of innovation, any kind of technology. Innovation is hard. It is hard to actually help drive the enterprise value. So I could help sell the company to the private equity firms and to the strategic acquirer, and so it was almost like banging my head against the wall and then I realized that, oh, my network. Remember, I dropped out of school and it probably took me about eight years before I went back to school. I was a little bit of an older like freshman.

Tonya J. Long: 50:53

I went straight through to my master's and I will tell you I have nothing but respect for people who come back into the classroom like freshmen. I went straight through to my master's and I will tell you, I have nothing but respect for people who come back into the classroom from a break.

Tonya J. Long: 51:07

Yes, they were my fiercest competition. Yeah, as a 22 year old working on my master's degree, because they had all this business wisdom and life experience. But they also they were serious about it because it was coming out of their pocket, they weren't working on scholarships and they were taking time away from their families. So you again, resilience. You knew you needed to do that and you went back, and I went back.

Belinda Ephraim: 51:23

So when I think of my network, truly my network are actually younger than I am. Same they're millennials, gen Zers, and my mental ability is actually really suited to speaking with them, communicating with them, working with them, because I get it.

Belinda Ephraim: 51:41

We all went to the same schools. So I started the podcast because I was like I'm going to establish thought leadership, as we all do when we start a podcast for a reason. And during that, during those conversations, was when I really started to listen to my side guests. So my network, the groundswell, what are people talking about? And that's when it started to click for me that, okay, the M&A path is really not the future, at least for me. And given my background, I know that I can bring so much more to the table as a VC where I can actually shape these stories and then find the advisors that can support me, especially starting up a VC firm advisors that can support me, especially starting up a VC firm.

Belinda Ephraim: 52:38

I'm going to be a solo GP, so I'll be the main investment decision maker. However, what I'm doing is I'm actually surrounding myself with technical advisors, so engineers, scientists, who actually understand a lot of these technologies, and so then that way, they're almost a second source.

Tonya J. Long: 52:53

Yeah, your LPs need to be a source of information, of information Collaboration.

Belinda Ephraim: 52:58

Correct. That's what I want for the kind of investors and advisors that I'm bringing to the table. So the podcast really is what shaped.

Tonya J. Long: 53:08

Oh really.

Belinda Ephraim: 53:09

Yes.

Tonya J. Long: 53:09

So you feel like the podcast helped lead you to this choice to be.

Belinda Ephraim: 53:14

Absolutely Fascinating.

Tonya J. Long: 53:16

Because I'm looking to see it. I'm only like two and a half three months into my podcast and I'm still asking the question of what am I here for?

Belinda Ephraim: 53:25

What am I?

Tonya J. Long: 53:25

doing. I know what the themes are. I know, what my heart cares about. But I'm like, should I be doing this? This takes a lot of time.

Belinda Ephraim: 53:32

Yes, it takes a lot of time it does, but that's really that it lends you, because when I started the podcast, I wasn't like, oh, I'm going to be a VC. I was like I'm doing this for M&A. So all of my content was around selling businesses, but it was about relationships, yeah.

Tonya J. Long: 53:47

Because I wasn't. I've done 20 M&As in my career from the inside of companies, not from an investment banking level, but I was on your podcast because we had met.

Belinda Ephraim: 53:58

Hit it off.

Tonya J. Long: 53:59

And I had the AI card to play, and then you helped me understand the things.

Belinda Ephraim: 54:04

No, but then it was great, oh AI. And then I had the Wall Street Journal. Was it no New York Times reporter that published? Was number two Was number two, but my first was Will, yeah, will.

Tonya J. Long: 54:18

Drury. Will Drury basically invented the lithium battery for Tesla. Will's listening? He's going to be like, oh my God, daniel Elon will be after me for that. But yeah, I'm going to go with that. I'm going to take some liberties, will? We hope you're listening and we're having fun with you. We miss you.

Belinda Ephraim: 54:35

But I've known. Will for it's true, but he is just brilliant, he is. Brilliant, and it was. I think I'm glad I had him as my first guest because it almost set the stage, because I was like, ooh, this is who I want, yeah.

Tonya J. Long: 54:52

In my community People like this, yes, and then you came to me.

Belinda Ephraim: 54:57

No, and I came to you. Here's another thing that's going to be unique about the VC firm TENSEUR is that I'm actually targeting. When it comes to advisors, I want seasoned folks around me. Yeah, of course. I want people who have deep domain experience, because the founders that are coming to me, they need help. They need help, yeah, but they're also coming to me from the Teslas and from the semiconductor companies and from the medical schools and you already knew this.

Tonya J. Long: 55:31

We don't have to know all the answers no but we have to know how to pull together the teams yes, where the answers are easily accessible. Thank you.

Belinda Ephraim: 55:39

And that's what you and.

Tonya J. Long: 55:40

I do very well.

Belinda Ephraim: 55:41

Yes, and so that's what I'm doing.

Tonya J. Long: 55:43

Love it. Yeah, love it. Okay, I'm going to have to bring you back. How long are you in town?

Belinda Ephraim: 55:52

We're going to have in town for quite some time.

Tonya J. Long: 55:55

Okay, good, maybe we could schedule something, then we'll pick up on, because we have talked actually a lot about your new love of the investment community and pulling it from a different angle, yeah, and I'd like to talk even more, though, about your personal things. We talked a little about you growing up in Nigeria, but you are a mindfulness maven. That's my term.

Belinda Ephraim: 56:18

That's nowhere in print and I cursed when you put the focus on me.

Tonya J. Long: 56:23

I know it's a little bit of a story and the thing is, you never do. I will say that I've been on what I've been on a dozen calls with you, and that was a first.

Belinda Ephraim: 56:31

It's all good, it's all good, so you can tell that this is something I'm really like passionate about all good, so you can tell that this is something I'm really like passionate about it's just because I see the frustration, and this is what inspires me to start.

Tonya J. Long: 56:40

So until we see you again here with mics that are giving us what we need from them. Where would listeners be able to get in touch with you, follow you and see you online? How can they get in touch with you so?

Belinda Ephraim: 56:53

they can get in touch with me on LinkedIn Awesome. They can also get in touch with me through a website. So it's TENSEUR and that's T-E-N. Let me do the let me backtrack here, let me be an engineer. So T as in Tango, e as in Echo.

Tonya J. Long: 57:10

I'll put this in the show notes N as in November.

Belinda Ephraim: 57:13

S as in Sierra E as in Echo U as in Filler R as in Romeo.

Tonya J. Long: 57:19

Capitalcom. Excellent, okay, and I will put these contact points in the show notes, as well as your podcast.

Belinda Ephraim: 57:26

Oh yes, my podcast is the Neo Industrialist Love it. We're on Apple Podcasts, YouTube for video, as well as LinkedIn Lives me on Apple Podcasts, youtube for video, as well as LinkedIn Lives.

Tonya J. Long: 57:40

It has been remarkable to have you in person because most of my contact with you since you're down in LA has been on the phone. We've seen each other a few times, but on the phone, so it is just remarkable to have you here. Can't wait to spend more time with you. Thank you for being here with our listeners today, teaching them something new. As we all think about the transitions in life and how we want to look at things differently, I'm going to make my own very tiny pitch. Everyone can invest, everyone can become part of this community, and I think that there's a lot of nascent investors out there who haven't just haven't considered that journey yet, and I think it's a good time for people to become more educated about the opportunities they have outside of the traditional retirement planning elements.

Belinda Ephraim: 58:20

Absolutely.

Tonya J. Long: 58:21

And it's going to be an interesting few years for you and me both.

Belinda Ephraim: 58:24

Yes.

Tonya J. Long: 58:25

As we build those communities up and offer and extend more opportunities to more people. Excellent, wonderful. So everyone. Thank you. This has been Reset with Tonya, with Belinda Ephraim E-P-H-R-A-I-M. Yes, when you look for her on LinkedIn. Have a wonderful day, bonsoir from Tennessee, and thank you for holding with us patiently as we figured out some technical issues here in the studio. We will see you next Thursday at 11 am Pacific time. Good day.