Who runs the world?

Houston entrepreneur wants to pave the way for female-led startups and VCs

Allison Lami Sawyer is among the small population of female venture capitalists. Courtesy of Allison Lami Sawyer

It took her a second to be able to admit it, but Allison Lami Sawyer — a physicist by training and education — realized what her professional path was going to be when she was finishing up her MBA at Rice University.

"It took me a long time to say that I wanted to be an entrepreneur," she says. "There's just not a lot of little girls in Alabama, where I'm from, that are entrepreneurs. I never met a female tech entrepreneur until probably a few years into Rebellion."

Sawyer started her first company, Rebellion Photonics, when she was 24. The company's technology has cameras that see gas leaks before they cause explosions on rigs, refineries, and pipelines. She ran the company from 2009 to December 2017. She's still on the board of Rebellion.

Once she knew she should be an entrepreneur, she was on the hunt for an idea before she met her business partner, Robert Kester, who was the CTO and co-founder at Rebellion.

"I looked at a few different technologies to commercialize and the one I decided on was a technology invented by a grad student at Rice University and he was our CTO.

Now, Sawyer is on to her next endeavor. She's co-founded a Houston-based seed funding firm called The League of Worthwhile Ventures with Roy Johnston. She uses her experience as a founder and raising money to lead the firm and provide resources for the startups. The company expects to close its first round of funding in the next quarter.

InnovationMap: What was it like moving on from Rebellion?

Allison Lami Sawyer: I think at first it was exciting. Entrepreneurs are not the kind of people who like to do the same thing for nine years, so I was finally like, "oh, thank God, something new," but at the same time, change is always scary. I have a very high threshold for change and uncertainty, an even for me it was scary. We had 40 employees in the Houston office — and more in Asia — and you get used to being so busy. It was weird having time again. I didn't take much time off because I knew what I wanted to do next.

IM: So, you know your The League co-founder Roy Johnston met at Rice, but how did you reconnect?

ALS: He had approached me and said, "hey, whenever you're free, I'd like to do a seed venture fund here in Houston and you'd be the perfect complement to do that." So, that was kind of in the back of my mind. Then I contacted him again, and told him we should do that and that the space I want to focus on is machine learning and artificial intelligence-enabled software companies. That's the space I saw blowing up. He was well versed in that, and had seen that come up. He has the traditional background, and I have the operational experience within machine learning, because that's what I've been doing this whole time. It's just one of those things where you couldn't have planned it, but it's been absolutely perfect.

We're going to start doing investments in the second quarter so we are already looking at deels coming in from all across the country — and even the world. It's the part I've always enjoyed the most: looking at business models, looking at strategy, understanding the business 101 and then merging that with hardcore tech. That combination is really exciting. We're going to look back at this time just like how we look back on the internet age and how it affected every industry. It's the same way it's going to be with machine learning and AI.

Within artificial intelligence, whoever makes the model first and grows it, will have the smarter model. There really is a first-to-scale advantage.

Roy and I have a personal preference for not sexy industries. I come from oil and gas, and he comes from Waste Management. Sexy tech in non-sexy industies is basically our M.O.

It's exciting to be enabling other entrepreneurs to go build really big companies. One of our reach goals for The League is to fund a unicorn. In home run of all home runs, one of them coming from Houston. We haven't had one i Houston before. We would love to be a part of that. Most of our investments will be outside of Texas, but we are already looking to do one Houston investment come secord quarter, so in our first set of investments, one will be from Houston. I love this city and it's fun to do our little bit to see the city grow, and then also to just have women investors.

About four years ago, I had a $10.5 million raise for Rebellion — about 100 meetings or phone calls, which is normal. I only had one meeting with a woman — and she wasn't even a decision maker.

The main way venture capital investments go is getting the warm introduction through your network. Seeing as 92 percent of VCs are guys, they're going to know other guys, that's their network. So, typically, who gets funding, is by no means even slightly a meritocracy. It's how good your network is. The philosophy around that to justify this is that CEOs need to know how to hustle, but what that doesn't acknowledge of basic barriers and systemic flaws. So, I'm excited to add one more female VC out there, join that network, and make my presence known so I can speak very openly on what I see as systematic issues

If we want more female founders, we will have to have female VCs. I would love for houston to be known as the best place in the world to be a female founder.

It's an all-women startup weekend. We're super proud of all the women. It's become this whole thing with a leadership committee and some of the big companies around town are sponsors. All our winners have gone on to raise millions in venture capital.

IM: With you and Ray both doing The League and Start Here Now, will the two ever be connected?

ALS: No, it's just a nonprofit we do. It's just the two of us and we have the same values. A lot of people are nice — most people are nice — but not a lot of people are actively kind, and we think to change some of these problems in venture capital is these proactive steps to change and one of these is giving up our time to do StartHereNow. Another concrete change we've made is you don't need a warm introduction to get a meeting with us. Absolutely anyone can submit their pitch to us on their website and either Roy or I will put eyes on it. We also do office hours — anyone in the community can come in, even if it's not a company we'd invest in. Anyone can come in on the second and fourth Thursdays from 4 to 5 pm, and we're there. Those are actually super fun. We had one female founder come in — and we have a really high bar, we're not going to invest unless we think you can have viral growth — with offers she already had and just wanted to see me to get my opinion on her term sheets. It was an absolute pleasure, and it was no skin off my back.

Is there some lesson you had to learn the hard way that now you're able to guide these women in their careers?

I think this all stems from when I was starting my company at 24. It was brutal, and it was very lonely to be a young female founder in oil and gas. That type of isolation takes the fun out of all this. You see the male founders having huge networks, and it took the joy out of founding a company. I don't want the female founders of today to have to go through that, because it didn't add any value. It was pain just for pain sake.

During my $10.5 million raise, I remember having a meeting with a big venture fund, and it was the fifth meeting, so it was serious. One of the men said, "hey I see you have a ring on your finger." And I said," Yeah, I'm engaged." He said, "What is your maternity plan?" And I said, "oh no, I'm not pregnant." And they were like, "But you will be." And it just changes the tone of the meeting. By the way, my co-founder is sitting next to me and he has three kids all really young, but that conversation never came up with him.

In many ways, we're a very traditional seed fund. We'll do our first close next quarter, and we'll continue to raise $50 mill throughout the rest of the year that we'll continue to raise the rest of the year. It's pretty traditional, but just by the nature of who we are, we're not that traditional.

We're getting to a point in machine learning where the tools are so cheap.

We want diverse deal flow — not just for diversity's sake, but because AI is going to affect every industry. I thin Houston has a real role to play in that. We'll see. I'm shocked we've never had a unicorn come out of here.

IM: With your connections in Silicon Valley, what do you bring to the table for your companies?

ALS: For a good venture capital firm, they they really good deal flow, and they pick the right ones and they exit, and there's a third step that regional firms don't have, and that's connections with later stage VCs. You need to be able to walk them in to those VCs, and I think that's what we offer.

I go out there every quarter, and I give updates on the companies we know we're going to invest in and I give updates on those companies so by the time the companies are ready to scale up, they've already heard about this startup. And I think that's why startup founders are interested in us.

IM: How are you different from other local VCs?

ALS: We're much more focused on user growth over earnings. In fact, if you're making a lot of profit, I wonder why. Let's put this back in the company and grow this thing. And I think a lot of Texas investors are very conservative, and really look for profit quickly, and that's not our end game initially. You need to have a business model that is capable of very large gross margins, but right now I want you to be funneling it back into the company and building your assets. And I can't even believe I have to say that. On the coast, that'd be a no brainer, but here that's what makes us a little different. We're much more a traditional California seed fund without the brofest.

IM: So, what's the significance of firm's name?

ALS: Well, some people think it has something to do with sports. But one of the hardest things about being an entrepreneur is the loneliness, and we don't want anyone to feel that way. We want to have a community. When you join The League, you're joining all of us. It's why we have a massive advisory board and corporations that have agreed to talk to our startups.

IM: What's been the reception of The League?

ALS: I'm actually a little shocked and thrilled to see how much interest we've gotten locally. We've had people reach out to us directly wanting to invest in our fund. I thought maybe Houston's market would be a little too conservative to want invest in a seed AI fund. I was wrong, and I couldn't be more delighted to be wrong. We are really pushing for as much as our investors to be in Texas because we think it's important for a community as a whole to invest in its innovation economy.

I will say that here I have to do a lot more education when I talk about AI. Because I don't really mean robots when I say AI. I mean is software able to make predictions. I think if I wasn't doing this I'd be a science teacher, so I do kind of like that. It's just a bit slower of a process.

IM: Do you imagine The League stays just in Houston?

ALS: We do get asked sometimes about why we are staying in Houston, and it's tricky. We're getting pull, but as of now we are based in Houston. We probably will open a Silicon Valley office. It's really about where are investors are, so if we have most of our investors in Texas, we'll stay in Texas. And I'm southern, and you can't get good iced tea anywhere else.

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Portions of this interview have been edited.

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Building Houston

 
 

Common Desk, which has locations across Houston, has been acquired — and other innovation news. Rendering courtesy of Common Desk

Houston is starting 2022 strong in terms of innovation news, and there might be some headlines you may have missed.

In this roundup of short stories within Houston startups and tech, the Bayou City is ranked based on its opportunities for STEM jobs, a Houston blockchain startup scores a major contract, Rice University opens applications for its veteran-owned busineess competition, and more.

Data Gumbo announces contract with Equinor

After a successful pilot, Equinor has signed off on a contract with Data Gumbo.. Courtesy of Data Gumbo

Houston-based Data Gumbo, an industrial blockchain-software-as-a-service company, announced that it has signed a contract with Equinor. The global energy company's venture arm, Equinor Ventures, supported the startup's $7.7 million series B round, which closed last year.

The company's technology features smart contract automation and execution, which reduces contract leakage, frees up working capital, enables real-time cash and financial management, and delivers provenance with unprecedented speed, accuracy, visibility and transparency, per the release.

“Equinor is an industry trailblazer, demonstrating the true value of our international smart contract network to improve and automate manual processes, and bring trust to all parties,” says Andrew Bruce, founder and CEO of Data Gumbo, in a news release. “Smart contracts are playing a critical role in driving the energy industry forward. Our work with Equinor clearly demonstrates the benefits that supermajors and their supply chain customers, partners and vendors experience by automating commercial transactions. We are proud to continue our work with Equinor to help them realize the savings, efficiencies and new levels of transparency available through our smart contract network.”

Equinor opted into a pilot with the company a few years ago.

“Since piloting Data Gumbo’s smart contracts for offshore drilling services in 2019, we have worked with the company to continually refine and improve use cases. We now have the potential to expand Data Gumbo’s smart contract network to enable transactional certainty across our portfolio from the Norwegian Continental Shelf to our Brazilian operated assets and beyond,” says Erik Kirkemo, senior vice president at Equinor. “GumboNet reduces inefficiencies and processing time around contract execution in complex supply chains, which is a problem in the broader industry, and we look forward to realizing the streamlined process and cost savings of its rapidly expanding smart contract network.”

WeWork acquires Dallas coworking brand with 6 Houston locations

Common Desk, which has six locations in Houston including in The Ion, has been acquired. Photo courtesy of Common Desk

Dallas-based Common Desk, which has six locations in Houston, announced its acquisition by WeWork. The company's office spaces will be branded as “Common Desk, a WeWork Company,” according to a news release.

“Similar to WeWork, Common Desk is a company built on the concept of bringing people together to have their best day at work," says Nick Clark, CEO at Common Desk, in the release. "With the added support from WeWork, Common Desk will be able to not only leverage WeWork’s decade of experience in member services to improve the experience of our own members but also leverage WeWork’s impressive client roster to further build out our member base.”

Here are the six Common Desk spaces in Houston:

Here's how Houston ranks as a metro for STEM jobs

Source: WalletHub

When it comes to the best cities for jobs in science, technology, engineering, and math, Houston ranks in the middle of the pack. The greater Houston area ranked at No. 37 among the 100 largest metros across 19 key metrics on the list compiled by personal finance website, WalletHub. Here's how Houston fared on the report's metrics:

  • No. 36 – percent of Workforce in STEM
  • No. 74 – STEM Employment Growth
  • No. 43 – Math Performance
  • No. 16 – Quality of Engineering Universities
  • No. 2 – Annual Median Wage for STEM Workers (Adjusted for Cost of Living)
  • No. 90 – Median Wage Growth for STEM Workers
  • No. 75 – Job Openings for STEM Graduates per Capita
  • No. 88 – Unemployment Rate for Adults with at Least a Bachelor’s Degree

Elsewhere in Texas, Austin ranked at No. 2 overall, and Dallas just outranked Houston coming in at No. 34. San Antonio, El Paso, and McAllen ranked No. 51, No. 65, and No. 88, respectively.

Rice University calls for contestants for its 8th annual startup pitch competition for veterans

Calling all veteran and active duty startup founders and business owners. Photo courtesy of Rice University

Rice University is now accepting applications from Houston veterans for its annual business competition. To apply for the 2022 Veterans Business Battle, honorably discharged veterans or active duty founders can head online to learn more and submit their business plan by Feb. 15.

“We’re looking forward to giving veterans the opportunity not just to share their ideas and get financing, but learn from other past winners the lessons about entrepreneurship they’ve lived through while growing their businesses,” event co-chair Reid Schrodel says in a news release.

Over the past few years, finalists have received more than $4 million of investments through the program. This year's monetary prizes add up to $30,000 — $15,000 prize for first place, $10,000 for second place, and $5,000 for third place.

Finalists will be invited to make their business pitch April 22 and 23 at Rice University. Click here to register for the event.

City of Houston receives grant to stimulate STEM opportunities

Houston's youth population is getting a leg up on STEM opportunities. Photo via Getty Images

Thanks to a $150,000 grant from the National League of Cities, the city of Houston has been awarded a chance to provide quality education and career opportunities to at-risk young adults and students. The city is one of five cities also selected to receive specialized assistance from NLC’s staff and other national experts.

“This award is a big win for young people. They will benefit from significant career development opportunities made possible by this grant,” says Mayor Sylvester Turner in a news release. “These are children who would otherwise go without, now having experiences and connections they never thought possible. I commend the National League of Cities for their continued commitment to the future leaders of this country.”

According to the release, the grant money will support the Hire Houston Youth program by connecting diverse opportunity youth to the unique STEM and technology-focused workforce development.

"Our youth deserve educational opportunities that connect them to the local workforce and career exploration, so they can make informed choices about their future career path in Houston’s dynamic economy. Houston youth will only further the amazing things they will accomplish, thanks to this grant," says Olivera Jankovska, director of the Mayor's Office of Education.

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