A Founder's Perspective: Travis May on Datavant & Venture Capital

A Founder's Perspective: Travis May on Datavant & Venture Capital
Auren Hoffman
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Published on
March 2, 2023
May 24, 2023
A Founder's Perspective: Travis May on Datavant & Venture Capital

“As current founders, Auren and Tod “get it” for a number of issues that are academic to a traditional VC.” 

- Travis May

Travis is the founder and former CEO of Datavant, the very first company Flex Capital invested in back in June 2019. Datavant was our first investment around the idea that current founders— Dual Threat CEOs, as we like to call them— could make better investors and partners. 

Safe to say, we were on to something. Since our initial seed investment, Datavant has grown into the largest health data ecosystem in the US, valued at over $7 billion after their merger with Ciox in 2021. (Flex has grown too— you can check out our portfolio here)  

Since that initial investment, we’ve seen concrete data from AngelList that backs up our thesis about Dual Threat CEOs. Beyond that, we believe our model is not just better for LPs, but better for founders as well. 

To that end, we wanted to talk with our very first founder about the experience of working with Flex. Recently, we caught up with Travis to talk about his relationship with Flex and building Datavant. His takeaways:

  • Current CEOs (like Tod and myself) have unique insight into running a business.
  • Networks are everything. Flex was able to make 30+ introductions at the start of Datavant’s Series B and move the process along quickly.
  • Traditional VCs can offer branding power, but specialized VCs can offer substance and support.

We are thrilled to have partnered with Datavant throughout their growth, and this interview with Travis really articulates why we believe in the Dual Threat CEO model. 

Interview with Travis May

How did we meet you? How long have you known us?

I met Auren in 2009, as I began working for him as a summer intern. We worked together for 6 years and scaled a business from $0 to $100+ mm together, and he became a mentor and friend from that experience.

I also met Tod through entrepreneurial circles in San Francisco about a decade ago – he beat me at Settlers of Catan a number of times, and we co-invested in a few businesses together.

What does your company do?

Datavant connects the world’s health data to improve patient outcomes. We provide the infrastructure for healthcare institutions to safely exchange their data for patient care, for research, and to improve cost-effectiveness of care.

What is the difference between working with a traditional VC and Flex? And, what are the types of issues that you feel more comfortable coming to Flex with versus your other VCs?

As current founders, Auren and Tod “get it” for a number of issues that are academic to a traditional VC. As a founder, you’re usually dealing with over-constrained scenarios where everything in the business interconnects, and they get the nuances.

Whether you’re thinking about “should I hire this executive even though they have X weakness” or “how do I manage myself” or “what rituals should I set up in the company” or “how do I scale my recruiting” or “how do I solve tension between X team and Y team” or “the world just switched to remote due to a pandemic – what do I do” or “how do I manage this negotiation with my biggest customer,” Auren and Tod are living similar issues in their own business, and do a phenomenal job at zooming into the real nuances of running the business.

The only advantage of a traditional VC is if you place a huge emphasis on getting a well-known brand as a seal of approval – but it’s rare entrepreneurs should prioritize that. And if there’s a great specialist VC in your industry, they can also be helpful at opening doors.

What has been your experience working with Flex since we invested?

Auren and the Flex team invested in our seed round, our Series A round, and our Series B round, and have been key parts of building Datavant from the inception. Their flexibility in the initial deal structure and our pre-existing relationship made them the first institutional investors in Datavant, and they have been among the best thought partners I’ve had in building the business.

The Flex team is happy to be deployed on projects that add value to Datavant; for example, when running our Series B process, I built our fundraise plan with the Flex team, and they made thirty introductions to tee off the process.

I invited Auren onto our board, and as a board member, Auren was always comfortable challenging the rest of the board with a provocative point of view or thoughtful questions that would sharpen my thinking, and then 100% supportive of whatever I decided for the company; I loved the “debate then commit” approach and the provocative thinking.

How would you judge my availability and responsiveness relative to your other investors?

Auren is one of the best people at email that I’ve ever met. He almost always gives a thoughtful reply to an email within an hour or so, whether it’s a weekend or a weekday.

But Flex is especially impressive on two other dimensions:
The firm as a whole can move super quickly. They are routinely the first firm to sign any document and to make any decision; and
The whole team will lean into a several-hour project same-day as well. For example, when we wanted to build out lists of prospects for our series B, Auren and Jeff would help me build out a list and make intros extremely quickly.

What would you tell another founder who is considering bringing on a traditional VC versus Flex?

Pick a traditional VC if you need a giant check or need a well-known brand. Realistically, there are very narrow circumstances where this is the right thing to prioritize as a founder.

Pick Flex if you care about the substance of the support you get in building the company. As Founders + VCs, the Flex team can help you think through the biggest questions as you grow your business.

Is there anything else that you think would be helpful for a potential LP to know about Flex while they are considering investing?

I’ve had a great experience working with Flex as an investor in Datavant, and I also personally became an LP in Flex because I deeply believe in their model – I believe that they are great entrepreneurs who provide massive value to the companies they invest in, and who are exceptionally well-networked at finding the best companies in tech.