A New VC Model That Turns Designers, Not Techies, Into Startup CEOs

The Designer Fund angel-investor and mentoring network is meant to encourage entrepreneurial designers to get into the tech startup game.

Enrique Allen had an epiphany while meditating one morning about how to bring design literacy to Silicon Valley. Instead of spending so much of his energy mentoring and consulting with startups about how to bring iterative creative thinking and a respect for user experience to their company culture, why not do the inverse? "I realized I should be helping designers become more startup-ey," Allen tells Co.Design. "Those are the people, who, if they become leaders in a company, will model design behavior from its inception, right in the company's DNA." So he started The Designer Fund to give entrepreneurial designers an on-ramp into the Silicon Valley world of angel investor networks, demo days, and funding rounds. "It's about helping to give designers a seat at the startup table that engineers and MBAs already have," Allen says. The intended result: Smarter companies, better products, happier users — and an improved world.

"It's about giving designers a seat at the startup table that engineers and MBAs already have."

But don't think that The Designer Fund is a cutesy attempt to turn font monkeys into dot-com tycoons just for the hell of it. "When I'm talking about design, I'm not just talking about the visual layer that everyone seems to think of when they hear the word," Allen asserts. "We really believe that designer-founders need to be able to guide the product and organization through 'the full stack': user research, interaction design, information architecture, all the way to the interface, and everything in between." In other word's Allen's fund is seeking people who already have the vision and entrepreneurial spirit that any Silicon Valley founder has — but just happen to self-identify as designers, too. Allen points out that designers have recently earned a rich pedigree in the Valley, having founded YouTube, Tumblr, Airbnb, Android, and Flickr, among others. And yet their talents are still unappreciated.

"What we're hoping to do is shift the paradigm of what design is. Design encompasses systems now, not just 'making things look pretty,'" Allen continues. "Designers have traditionally been paid a lot of money to make what people want; meanwhile, most startups fail because they make things that people don't actually want! We need more designers who are trained in methods of getting to these 'aha' moments about customers, products, and use cases to consistently do that with startups. And that's a great opportunity for designers to make a foundational contribution in a startup venture."

But Allen isn't preaching a gospel of "designers can do everything by themselves." Business is about profitability, engineering is about feasibility, and design is about desirability — and all three specialties need to overlap in a successful startup. "I'm talking particularly about consumer tech, where the user experience and the brand is so important for differentiating from all the other crap," he asserts. "And that's what designers should be good at."

"Most startups fail because they make things that people don't actually want!"

Allen also takes pains to note that the Designer Fund is meant as a complement, not a competitor, to established startup incubators and seed funds. "I hope to position the D.Fund as accelerator agnostic," he explains. "We can help direct them to Ycombinator, Greylock, and other networks to get their business off the ground, while also demystifying jargon about getting incorporated, and other things that can seem intimidating. We're primarily offering mentorship, and some angel investor money from designers like Christina Brodbeck, Dave Morin, Ben Blumenfeld, Scott Belsky, and Michal Kopec, just to give someone a runway. But the network is the most important thing."

The Designer Fund's application cycle runs its course every three to four months, and Allen purposefully timed it to sync up with key dates at other tech incubators. The first two startups in the Designer Fund pilot program, (think a for-profit version of StoryCorps) and (The Food Network meets low-income immigrant women), were advised by IDEO founder David Kelly and are now part of the 500 Startups accelerator, which Allen co-founded.

For Allen, a designer himself (he trained at the Institute of Design at Stanford), the Designer Fund isn't about drawing lines in the sand about what design (and designers) are or aren't. "It's breaking down these artificial barriers. That label, 'designer,' simply articulates the founder's intention to create systems and experiences that persuade people to do something. That will be the best indicator of who they are, not their titles or methods or definitions. If design is so important to startups, let's lead and model these behaviors — and its impact will speak for itself."

[Top photo by Tim Collins]

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  • SabrinaKiefer

    Great initiative! We have been doing similar work in the Entrepreneurship Hub at Imperial College in London, in partnership with the Royal College of Art and Design London, to team up engineers, designers and MBAs on projects. The user-centered design component  and design thinking in general are a great advantage!

  • SabrinaKiefer

    Oops, missed your reply last week! Happy to give you my email and further details on our Innovation, Entrepreneurship and Design program if you connect through Twitter @sabkiefer. Look forward to hearing from you.

  • Peggy Ludwick

    Wonderfully informative interview, Enrique.  I did post grad work at
    Stanford in Immunology/Laboratory Science over 40 years ago.  If I could
    do something all over again, I'd go to the Stanford Institute of
    Design.  It sounds fascinating - and so applicable to our every day
    lives.  It integrates creativity and the arts with science - exactly
    where I've evolved over the years.  Thanks for your good work. I'm a
    fan.  Peggy (Ben's mom)

  • Enrique Allen

    Thank you Peggy! We definitely need more designers to integrate arts, science, engineering and other disciplines. 

    Ben is a lucky son!

  • Dexter Francis

    It's interesting how the definition of the terms has changed over the years.  When I graduated from Stanford we called ourselves Product Designers, but the diploma said B. S. Engineering.  At Apple, we had Industrial Designers and Product Designers.  Where I work today, "Designer" means CAD Specialist and "Engineers" do analysis (thermal, structural, etc.)  

    With the growing emphasis on UX/Usability, I suspect the more important differences are in whether the "creator" is accommodating the product to the user, or the other way around.   In any case, understanding the interactions of the art and science *and* finance and  accounting have made all the difference in many of the successful/breakthrough products I've worked on.

  • Enrique Allen

    Thanks dexter, great point -> the best definitions of design/designers are inherently contextual. Designers come from all different back grounds and different skills/tools are required for the domain/opportunity space. So designers who need to ship product/start a company need different methods/mindsets than a designer in another sector...

    Accommodating the user, being human-centered, having empathy should be a universal mindset for the entire startup, doesn't matter if you're the "designer" 

    I also completely agree that solid engineering & biz (finance/accounting) founding members are critical and often underpin great user experience.

  • Enrique Allen

    Thanks John! 

    Like I said it's not about me/ego  (if I succeed, I should dissolve into the background like great design that doesn't even get noticed), it's about the ecosystem of designers involved who are way better designers than me and future designer founders like the guys behind AirBnB. 

  • magicbeans Incubator

    Designers are integral to Startup success. MB is always looking to work with new amazing designers with fantastic product ideas. If you have an idea, and would like free resources and funding apply for our Summer of Big Ideas Initiative here:

  • Matthew Scharpnick

    Enrique is doing amazing things.  Always great to see his important vision for design building momentum.  Thank goodness Apple makes the business case for design on a daily basis.  Lets hope the D.Fund leads to a world with products and services that are more human-centric.

  • Enrique Allen

    Thanks for helping teach meditation to others...

    Yes, being human-centered and having empathy, no matter what discipline/skill set you bring to the table is universal...