Investing in the Future of Columbia Alumni-Connected Venture

Entrepreneurship is a family affair for Steven Zausner (SIPA 91). And, as Fission Ventures’ Founder and Managing Partner, the New York City-native is eager to apply three decades of investing experience to boost startups associated with Columbia alumni.

“I used to say if there were five goats and three folks trading something, I was probably there.”

This is how Steven Zausner, MP of newly launched Fission Ventures, describes the first two decades of his investment career. Those years saw him work at several large hedge funds, private investment partnerships, and asset management firms.

Steve now helms a new fund by Columbia alums for Columbia alums: Fission Ventures. Below he tells us about the path that led him to investing in his Morningside Heights roots.

What’s your connection to Columbia?

I grew up not far from the University, and I’m a graduate of the School of International and Public Affairs (91), MIA, where I was an International and Dean’s Fellow and my concentration was International Finance and Business. I also met my wife, Christina Campbell (SIPA, Harriman Institute, FLAS), there.

Tell us about your professional background. Where does your investment career begin?

Most folks in my family are entrepreneurs, and I was influenced a lot by Joseph Schumpeter, who wrote about entrepreneurship and innovation. After graduation I was looking for a job where I could combine my loves of investing and entrepreneurship. I tried mightily to find a job in VC—and failed (an essential lesson of venture). I’d like to think it was because the ecosystem wasn’t evolved enough, but maybe it was just me.

So, I went with the next best thing, emerging markets, and moved to Russia. This was the early days of the post-Soviet rebirth of the Russian capital markets, where an entrepreneurial spirit (and warm coat) was required. I ended up working in research at a Moscow-based brokerage firm and learned a lot about the complexity of understanding companies where information is minimal.

Fast forward 20 years and I had the opportunity to work at several large hedge funds, private investment partnerships, and asset management firms. During that time, I sourced, analyzed, structured, and exited more than $10 billion in private investments, across many different asset classes and geographies.

How did you land in VC?

Throughout that time, I kept poking around the world of venture, which was growing rapidly. I joined angel groups, mentored at accelerators and incubators, and did some deals for my personal account.

Around 2009-2010, I met fellow Columbia alum David Rose, the founder and Chairman of the NY Angels and the creator of Gust, a tracking system used by many angel investment groups. I ended up becoming a Venture Fellow with his investment firm, Rose Tech Ventures.

I got lured back to “big-time” finance, as David used to call it, to help rebuild the alternatives business of Banco Santander post a — ahem—trying time. It was a challenge too good to refuse, but I knew that I wanted to be back in venture, full-time, at some point.

What sparked your interest in working for Fission Ventures?

It was an instance where avocation met vocation. Fission works for me on a philosophical, practical, and personal level.

Philosophically, I love that we are trying to “democratize venture capital.” It is a great asset class, with terrific risk-return dynamics. But, most people, even the wealthy, don’t have access to it. You can do some angel investing, which is great, or invest in your buddy’s firm, which usually doesn’t end so great. Getting access to late-stage deals, being able to invest alongside top-tier VC firms, even as a professional investment manager, with some decent resources, I was unable to do this. I think AVG provides folks with the opportunity to have a very sophisticated venture investment as part of their portfolio.

Practically speaking, I think what Fission and the broader AVG fund family are doing is amazingly pragmatic—and (that holy grail of venture) scalable. We have a network of 11 funds and growing. I get to run a lean, nimble, and hopefully high-perfoming fund. And I have substantial resources to leverage: 10 highly experienced Managing Partners with amazing backgrounds (including another Columbia alum who runs the Blockchain Fund); a team of hard-working and super-smart principals; and a 40-person strong back-office that takes care of the operational and marketing work, allowing me to focus on investing.

What is the most important lesson you’ve learned during your time investing?

I have a sign above my desk that says, “Manage the downside, and the upside takes care of itself.” It’s been there almost since the beginning of my investment career and, during my first conversation with AVG’s Chief Investment Officer, he echoed the phrase. I knew then I had found a home at Fission and AVG.

Opportunity is everywhere. Investing, however, is about managing risk. There is a lot that can go wrong from hearing what sounds like a great idea to actually making money. Understanding the risk involved, endogenous and exogenous, is essential. If you can get comfortable with what can go wrong, if you believe the risk—while substantial—might be less than the reward, then you probably have a good investment.

Which resources or sources of inspiration (podcasts, books, blogs, mentors, etc.) are most useful to you on a regular basis?

I read a lot, everything from technical books to spy novels. And I have a couple go-to podcasts: Waking up with Sam Harris (though my wife believes he should be listened to at 1.5x speed) and Very Bad Wizards. I meditate, which keeps me focused, and sane. I keep pretty active. I started rock climbing about six months ago, and I love it. I also have been playing guitar—badly—for about 30-years. I am really, really close to nailing the opening from Stairway to Heaven.

Smart, Simple Venture Investing