Meet Morgan Polotan, Partner at Monashee Capital

Morgan Polotan is a Partner at Monashee Capital, a hedge fund backed by Leucadia Asset Management. Morgan is someone who defies taking the conventional path. Upon graduating from Northeastern University, he moved to Los Angeles to try his hand at becoming an actor. At twenty-two-years old and with the youthful looks to play a high schooler, he landed some background roles for teen sitcoms like iCarly and Victorious, though his biggest gig was as the lead for a national commercial advertising a generic brand of acne medicine. The random, sporadic nature of the work eventually caught up with him. Within a year, Morgan moved to Washington D.C. for an analyst role at the Charles Koch Institute, a nonprofit where his job was to evaluate the proposals of startup nonprofits and determine which ones to back with grants. The role incited in him the bug for tech. Morgan desired to work for a startup. He quit his job, moved in with his future wife in New York City, and locked himself in his room to teach himself to code for 80 hours a week. Nine months later, he emerged as a fledgling software engineer and landed an entry role as a programmer at the adtech startup Tapad. On the side, he took up teaching coding at the engineering bootcamp General Assembly in New York City. One day after class, riding the gritty subway lines, his co-instructor told him about an opportunity for a two-year role at the early-stage venture fund Bloomberg Beta. Morgan hadn’t anticipated becoming a venture capitalist, but he was already knee-deep in the interview process for landing a role as the first engineering hire at a startup and thought that he could leverage one offer to secure the other. He received both offers. He ran the risk calculus and accepted the role at the VC firm, thinking he could always fall back into engineering. The bet paid off. Following Bloomberg Beta, Morgan went on to work as a principal at Comcast Ventures and then as a Senior Principal at B Capital Group. Last year, he joined Monashee Capital as a partner, where he today leads the group’s private tech investments. 

Morgan grew up as that self-starter type of kid, curious and ambitious, a tinkerer of ideas. He was an active sports player in his youth and had harbored for a time that common boyhood fantasy of playing professional basketball in the NBA. At twelve years old, he started an eBay consignment business to make some extra money on the side. He would scrummage yard sales for desirable objects and flip them on eBay for an easy profit. If you had talked to him back in those days, Morgan would have cited Warren Buffet and Bill Gates as his role models, perhaps foreshadowing his later interest in tech investing. Nowadays, Morgan likes to spend his free time staying active, playing basketball and all the racquet sports, on top of training for a half marathon. He cites an obsession with trying to shape the world to reach a more positive, logical order and believes in the power of technology development in raising the living standards of humans. Tech investing might be his career calling for now, but Morgan moves with the conviction of someone driven by a greater purpose--catalyzing human progress through innovation.

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Sam: You have a very nontraditional pathway into venture capital. You were an actor, an analyst for a nonprofit, and a software engineer. How did you ultimately break into venture capital?

Morgan: In my life before I became an investor, I was an engineer. I wasn't trying to break into venture capital. It wasn’t on my radar. I knew generally about the relationship between startups and investors, but I did not know the ecosystem at all. I kind of fell into venture capital by accident. I’m someone who loves teaching and mentoring. I was teaching programming at General Assembly in New York and my co-instructor, and I would ride the subway after the classes. We would talk about programming but mostly startups. My fellow co-instructor went to a high school in New York City called Stuyvesant, and he was on an alumni newsletter list. The founding partner of Bloomberg Beta, a guy named Roy Bahat, had posted in the Stuyvesant alumni newsletter that he was looking for an associate for a two-year role and that he was seeking someone with a technical background because he was investing in AI startups. At the time, I was actually interviewing to be the first engineering hire at a startup. When my co-instructor told me about this venture role, it wasn’t really what I was looking for, but I figured that I would just throw my hat in the ring and apply so that I could use that as leverage to move the interview process along with the startup. I was lucky enough to get both offers. That’s when I really sat down and thought seriously about going into venture capital or staying on my engineering track. I was curious enough to give the venture capital role a shot because it was a two-year role. I figured that worst case scenario, I could always go back into engineering. After two years in venture at Bloomberg Beta, I realized that was absolutely what I wanted to do. That was the beginning of my investing career.

Sam: What are your favorite tech areas that you like to explore as an investor?

Morgan: My answer is perhaps not satisfying because I don’t get excited about verticals per se or sectors or even technology. I get mostly about founders and their visions. So for me it’s not about the stage, the sector. It’s almost a feeling that’s hard to articulate or explain, but it’s that feeling when you meet a founder and you just grasp their vision. It can be in almost any sector or stage. It’s that kind of emotional feeling on a first call that I latch onto.

Sam: What is your favorite part of your role as a VC? 

Morgan: What fires me up is meeting founders and helping advance their visions, supporting them in any way.  As an investor, you’re like a coach on the sidelines. You get to watch the players on the field who are the best at what they do, and it’s your job to support these players. The more skill and experience you get, the more you can support these players. For me, I get excited about people and their big ideas. I remember when I was at Comcast Ventures, I heard about a company called Dandelion, which produced geothermal solutions that replaced existing air conditioning and heating equipment. My thought was that this product needed to be in every household in the Northeast, perhaps the whole U.S., and even globally. I tracked down the founder Kathy Hannun, and we ended up investing in the company. It’s the big visions and the founders that really fire me up. If I won the lottery tomorrow, I know I would just be doing the exact same thing.

Sam: What would you consider is the hardest part of the job for you?

Morgan: I think the hardest part of the job is finding a great company that might not turn out to be a great investment, largely because of valuation. That’s really tough for me. I get excited about the founder, the mission, and the vision, but I don’t get excited about the numbers. I don’t come from a banking background, and I don't excited about great deals separate from the mission or the vision per se. It’s not really how my brain is wired. When there is a founder and a vision that I’m really excited about, but the price makes it so that I can’t justify the deal, that’s really frustrating because I believe and want to advance their mission. But of course you have duties to your LPs to make money, so sometimes you have to say no even though you really are compelled to support the founder. That’s really tough.

Sam: What lessons would you distill from your career that you would share with the emerging cohort of VCs?

 Morgan: The number one lesson I tell everyone who is willing to listen is that you have to connect with your unique interests and passions that you have as an investor and double down on that. What do I mean by that? Whether you’re interested in AI or crypto or cybersecurity, whether it’s a hot sector or not, focus on the verticals that you’re passionate about. For example, when I’m interviewing candidates or speaking to people who are trying to break into VC, they are often disconnected from their personal passions. A lot of times they feel like they need to express interest in whatever sector is hot at the time instead of being true to where their actual interests lie. If a job is hiring for a FinTech investor but you’re not interested in FinTech, you’re going to have a much harder time getting motivated to learn the space than someone who is intrinsically motivated about the space. I tell people that you need to flip the script. You can’t mold yourself to various jobs because, frankly, you’re not going to succeed. Instead, what you need to do is some introspection. Figure out what interests you and focus your efforts there. Connect with the areas where your passions lie, even if it’s not in a hot sector. The way you flip the script also helps you in your interview process because then you are screening the firm, as opposed to just the firm screening you. Then you can better understand what you can bring to the table and be a relative expert in that field at your firm.  So if a firm is hiring for FinTech and you’re excited about digital health, then you can reject the firm. That’s pretty empowering. That’s my number one piece of advice. 

Sam: Where do you see yourself in a decade, two decades from now?

Morgan: I hope to definitely still focus on longevity goals like health and wellness, getting eight hours of sleep. From a career perspective, I also hope to be doing the same thing--just supporting founders that I believe in.

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