Laurie McGraw is speaking with Inspiring Woman Candace Richardson of General Catalyst.
Candance talks about her investing philosophy, why measuring portfolio success based on societal impact is important, what Black History Month means to her, and then we also talk some girl math – as in when closing the gender health gap has a $1T global impact ….WHY is it that we saw investment in women’s health companies cut in half in the last two years??. Spoiler alert – the answer is complicated… Well, actually, it is NOT that complicated. One of the solutions to squaring that circle includes having more women on the funder side of the table.
But first, let’s start at the end and let’s talk tennis!!
Why tennis? Because Candace loves tennis. Not just a fan, but a previously competitive player, now turned teacher and coach. For the past seven years, Candace has been teaching tennis at the Kings County Tennis League, an organization that uses tennis and education to spark the potential in kids living in Brooklyn public housing. And when Candace talks about what it means to her to be teaching tennis to young kids (4-8 yo), she describes it as “one of the most fulfilling things she has ever been a part of.”
This level of personal commitment speaks to the underpinning of her investment philosophy. We can bend the cost curve in healthcare, if we direct care to those who need it most. We can improve outcomes and have financial returns when we focus on historically underserved populations (ie Cityblock Health). We can hold ourselves accountable for societal impact (Homeward Health’s recent B Corp designation).
And as someone who grew up as someone very interested in history and current events…..expecting to be a journalist…..demanding her parents take her to CNN headquarters just because….Candace also talks about what Black History Month means to her.
“It’s American history and it serves all of us if we have kind of a clearer picture of kind of what got us to where we are today, so we can make sure the future is brighter.
And I think that future gets so much better, much brighter, when we have more people, more women, more black women, more people around important tables making big decisions.”
Guest Bio:
Candace Richardson
Principal, General Catalyst
I grew up in Asheville, North Carolina watching the news every night believing I would become a journalist, keen to have a grasp on what was happening around the world and why. After moving to NYC for college I continued on this pursuit academically, studying economics, philosophy and history but my career aspirations evolved, and like many at that age I entered an exploratory phase professionally. After discovering that my mother had been a political activist in Ethiopia before she emigrated, I traveled there with her to create an oral history project on the role of secondary students in the Ethiopian Revolution, and that got me thinking about a career in academia. I also spent time at a think tank to explore economic policy at the federal and state level. In the end, I received and followed wise advice that a career in finance would keep me connected to current events, and the integral role capital markets play in shaping them, while affording me the opportunity to make a difference in the world.
Beginning my career at Goldman Sachs, I got a fast, immersive education in healthcare finance across the capital structure. I furthered my interest at Town Hall Ventures, where I was able to work closely with companies that serve medically vulnerable and historically underserved patient populations. And because the firm was relatively small, I was able to contribute across a range of essential activities, from raising a fund and portfolio management to observing boards.
General Catalyst has a tremendous opportunity and influence in healthcare, including how care is delivered and paid for successfully, and equitably, for all stakeholders. The firm also has deep technology and consumer experience that is essential to the transformation of healthcare from a “sick care” system to a more proactive and resilient Health Assurance system designed to make quality care more affordable and accessible to help people stay well.
It’s probably no surprise that I enjoy tackling big problems that require extensive collaboration to dissolve barriers and create new solutions. I think of it as a combination of lofty and grounded, creative and practical. It’s the same in my personal life, where you can find me painting one day and teaching tennis to kids the next.
[00:00:00] Well, to me Black History is American History.
[00:00:03] Right? It's it's global history and I was very fortunate to be raised in a home where
[00:00:11] there's a lot of value placed on understanding history where you come from,
[00:00:17] exposed to a lot of books, historical figures.
[00:00:22] And so it's always been core to how I think about American history.
[00:00:31] And so for me, you know, it's encouraging when I see more focus broadly on Black History
[00:00:41] during the month of February because it feels like we are making progress and closing
[00:00:47] some of these gaps that exist between, you know, people who've had different life experiences
[00:00:54] and different exposure to kind of fill in some of these, these holes that exist because
[00:01:00] it like I said, it's American history and it serves all of us if we have kind of a clear
[00:01:08] picture of kind of what got us to where we are today so we can make sure the future is brighter.
[00:01:13] This is Inspiring Women. Today I'm speaking with Candice Richardson.
[00:01:21] She is a principal at General Catalyst. She has a long history in healthcare finance,
[00:01:27] but she actually wanted to start out being a journalist. I want to talk to you about
[00:01:31] that Candice, but I'm really excited to have you today on the program. Thank you for
[00:01:36] being on Inspiring Women. Thank you for having me, Roy.
[00:01:39] All right. Well, let's dive in. So Candice, I have been studying your background, just
[00:01:46] story career starting off Goldman Sachs, Town Hall Ventures. Now a principal at General
[00:01:51] Catalyst, a premier healthcare firm doing quite a lot of investing. But for you, you just
[00:01:59] talk about yourself starting off wanting to be a journalist and going in a really different
[00:02:05] direction. So how did you end up here? Can you give us that background? Yeah, happy to.
[00:02:12] So growing up one of the traditions in my household was watching the news. So it was
[00:02:18] a big fan of Peter Jennings and Christian Almond Forer and I would watch Crossfire on CNN
[00:02:25] back in the day when people opposing V points with Sid and the same bull and hash it out.
[00:02:31] I was always so impressed by kind of the curiosity that these journalists brought to the table,
[00:02:39] the types of questions they asked and the appearance of being very familiar with such a broad
[00:02:46] range of issues and whatever was relevant in the world at the time. So I just kind of
[00:02:52] became obsessed with that career pathway. I had my parents drag me to the scene and
[00:02:58] had quarters many times at Atlanta for the studio. And I thought I would go that route,
[00:03:06] but when I went to Columbia which has a very good journalism school kind of by chance
[00:03:12] I ended up making friends who were interested in finance and they were like, hey, just come
[00:03:19] with me to this event. I got an email there's going to be someone from an investment bank
[00:03:23] there. There's going to be free pizza so no downs. And so I went to this dinner and it's funny
[00:03:31] how the life works out because there was meant to be a woman from HR from Morgan Stanley there
[00:03:38] who had to pull out at the last minute. And one of the trustees of Columbia ended up coming to that
[00:03:44] dinner instead he was very passionate about kind of developing young talent and recruiting from his
[00:03:52] alma mater. And I was just blown away by this man. He worked in securities at Morgan Stanley,
[00:03:59] and I remember he taught me the difference between equity and debt. And it took me down this rabbit hole
[00:04:05] wow you know the the economy is such a critical kind of influence to current events that are happening
[00:04:13] right? And then he told me about a program they don't kind of broadcast widely for freshmen
[00:04:20] internships at Morgan Stanley. And it was kind of you know off to the races from there I became
[00:04:28] very interested at the start and commodities again that connection between you know these like
[00:04:37] really tangible assets and things that were going on in the world at the time I remember there
[00:04:41] were soybean farmers on strike in Argentina and I thought that was fascinating to see how the price
[00:04:46] of soybeans change. And yeah kind of state and finance and really enjoyed you know learning about
[00:04:58] of how the how the world works through an economic lens. Well talk about picking a large section
[00:05:06] of the economy so if we talk about health care where you spend your professional time that is
[00:05:13] a 4 trillion part of the economy absolutely enormous and you know fortunately are unfortunately
[00:05:20] just continuing to grow. So I wanted to actually go a bit into you know the investment thesis that
[00:05:29] you have because certainly with investments you know financial returns are the main objective
[00:05:38] but you've talked about a really different value thesis in terms of what you're looking looking for
[00:05:45] at your work at General Catalyst and just to quote you you've said we're interested in investing
[00:05:51] in companies that are going to be at the intersection of financial and societal returns. And one without
[00:05:59] the other isn't particularly interesting to us so money is the way the world works and how the
[00:06:06] world goes around and generally is the main focus for investing but you're talking about something
[00:06:12] different. Can you give us a little bit more information about that? Yeah happy to.
[00:06:20] Yeah I think you're definitely right you hit the nail on the head that
[00:06:24] you know where we invest our capital says a lot about the type of society we are and what we want
[00:06:31] for the future. And so we at General Catalyst feel it's very important that we are
[00:06:38] doing right by our investors right we have a lot of big pension funds etc that are relying on us
[00:06:47] to make returns on their investment but that can't be at odds with you know investing in the future
[00:06:56] that we think is most beneficial for the society we live in. And so from a healthcare standpoint like
[00:07:03] you said it's a very large industry in the US we spend four trillion dollars a year and that's rapidly
[00:07:09] growing and you know the experience for most people is abysmal costs are high quality of care has been
[00:07:18] low very hard to access care even if you have a lot of resources talk to folks who
[00:07:26] um you know get a cancer diagnosis my view is you know you can be an executive at a fortune 500
[00:07:34] company or you know someone who is a Medicaid beneficiary it's probably not good experience for
[00:07:42] either there's degrees of how bad that experiences but we have a long way to go across the board
[00:07:49] and so um we're really passionate about investing in founders who want to improve quality access
[00:07:59] while reducing the cost of care because it is unsustainable and the ramifications for how unsustainable
[00:08:08] our spend is on healthcare are far reaching right we're talking about um macroeconomic implications
[00:08:17] you know you know national security implications it's something that we have to get right
[00:08:24] and so the types of companies we want to invest in um have used technology oftentimes
[00:08:34] um and innovative payment models such that they can deliver care or enable the delivery of care in a way
[00:08:45] that aligns incentives right and so in today's system there's a lot of incentives to actually
[00:08:52] provide more care, prescribe more drugs do more surgeries because then you can build Medicare more
[00:09:00] and then the doctors make more etc um the type of care we're interested in is proactive
[00:09:08] and you actually get paid when you deliver better care at a lower cost.
[00:09:16] So maybe let's go into some of those investments because you know one of the areas just if I
[00:09:21] look at you know some of the companies um that you have invested in their companies like
[00:09:27] Eleanor Health and Homeward and City Block and you know half a dozen or a dozen more that are
[00:09:34] specifically focused on whether it's Medicaid populations or the underserved so I'd love to
[00:09:41] just get your perspective on you know generally even though Medicaid populations just to talk about
[00:09:48] that um populations 90 million people this enormous um you know enormous volume of people out there
[00:09:57] who are covered yet the Medicaid reimbursement rates are low so how do you
[00:10:03] how do you see that investment thesis playing out so that you get both the financial return and
[00:10:10] the societal benefit I mean the societal benefit and that case seems like easy to understand
[00:10:16] you know helping people who are generally not able to get the care that they both deserve a need.
[00:10:22] Yeah it's a great question um and we feel very honored to have been you know a long-term partner
[00:10:30] with City Block Health who I would argue has really been a pioneer in this space to demonstrate
[00:10:36] to the market that um you can serve the Medicaid and dual eligible population meaning people
[00:10:43] who qualify for Medicaid and Medicare in a way where you provide dignified care high quality
[00:10:51] care good access to care but you can also generate a profit and generate good returns for your
[00:10:57] investors and so that's been amazing to kind of witness that journey and then also um you know be
[00:11:04] a part of a team that's investing in a lot of companies that are kind of coming up behind them
[00:11:09] in different areas um you know I think you know people are people and general there's a lot more
[00:11:17] similarities across different populations than differences um but there are some um
[00:11:25] some differences in the way that Medicaid is paid for and regulated that make it a bit more
[00:11:31] complicated right yes so there are differences by state in terms of the reimbursement rates and
[00:11:39] different regulations around what's covered um you know the budgets are changing year over year
[00:11:44] sometimes there's waivers that expire etc um and so there's kind of a complexity around
[00:11:51] of the regulatory environment and the operations that need to kind of match the realities when
[00:11:58] you're serving the Medicaid population um and then within the Medicaid population aside from
[00:12:04] kind of the age-blind and disabled group which tends to be a more stable um kind of membership base
[00:12:13] uh there is you know a decent amount of current right people will qualify for Medicaid one year
[00:12:19] and then not the next or the kind of administrative overhang of making sure you you know enroll each
[00:12:26] year into Medicaid as a big burden and so I'd say there has to be a lot of focus on the social drivers
[00:12:33] of health um in addition to the more kind of clinical uh needs that members have and so the companies
[00:12:42] that we invest in that serve the Medicaid population like city block um like Eleanor Health and others
[00:12:48] you'll see that they have very holistic models where they're not just doing physical care
[00:12:55] they're doing mental health care they're helping with social services oh you need help finding a job
[00:13:01] you know they can connect you with people um that can help you get that sorted um because oftentimes
[00:13:07] you'll find that the downstream um kind of physical ailments that people are dealing with
[00:13:15] have upstream mental or social drivers that that need to be targeted if we want to drive
[00:13:21] sustainable change and then about that sustainable change in that societal impact can't
[00:13:26] as you know I thought we were introduced by um one of your companies homeward who has recently
[00:13:33] achieved uh becoming a certified B corporation so not just financial returns but also um providing
[00:13:40] sustainable sustainability you know societal impact on that side of the equation which is such an
[00:13:47] important part of your investment thesis how are you measuring that how how do you hold your
[00:13:53] investments um accountable to that and how does homework you know get measured with now this
[00:13:59] new important status of being a certified B corporation yeah um the the B corporation certification
[00:14:10] is really a testament to the founders of of homework health the co-founders so Amar Kendale and
[00:14:18] Dr. Jenny Schneider um who we co-founded the business with and um you know they're strong kind
[00:14:27] of moral compass around what we call responsible innovation and that was one of the reasons why
[00:14:35] we we worked together we have aligned values in that way um and so we ruled out
[00:14:43] uh an initiative and must have been a couple of years ago now called responsible innovation
[00:14:50] and it's really been woven into everything that we do at General Catalyst and so each time
[00:14:57] we make an investment whether it's a new investment um a follow-on investment in an existing company
[00:15:04] we actually have a section of our investment committee memos that need approval from the whole
[00:15:09] partnership where we in quite a bit of detail talk about the responsible innovation
[00:15:16] implications of what this company is doing have we had conversations with the founders
[00:15:22] what's their kind of view on the um positive and or negative outcomes uh whether intended or
[00:15:30] unintended that could arise over the years um we have to in detail talk about um you know
[00:15:37] what we're doing to make sure um that the company stays on course how we're holding them accountable
[00:15:45] and so you know these are conversations that we're having with founders throughout the process
[00:15:50] leading up to an investment um and then you know the responsible innovation component gets reviewed
[00:15:56] before any deal is um is approved at the firm as well and then on an ongoing basis i think it's just
[00:16:05] a really critical part of governance right being that an voice in the room um to say hey have we
[00:16:13] thought about x or y you know we're regularly asking companies to um look at the data to see is there any
[00:16:22] disparities between you know how certain cell populations are responding to your care right um
[00:16:29] yeah so that's all in place i think we're we're still working on um more of kind of like a
[00:16:37] structure kind of analytics approach because as i'm sure you can imagine um all these companies have
[00:16:44] different models and different metrics that they're tracking they're at different stages of their
[00:16:48] journey and so it's all about balancing um you know having the visibility around what impact are we
[00:16:55] making but also not um kind of creating a burden um for the companies based on kind of their stage
[00:17:04] and where they're at and i can't say i actually wanted to ask you a bit more about this because i
[00:17:09] think sort of that responsible investing investing having a lens towards health equity having a lens
[00:17:16] towards societal impact i mean it's very compelling um yet there's also data out there where
[00:17:23] you know what seems to me to be just these amazing opportunities moral imperatives if you will
[00:17:29] and i'll just take an example women's health so we've got the world economic form recently putting
[00:17:34] out a report that if we made a significant investment in women's health that we would see one trillion
[00:17:43] dollars of economic impact um globally which sounds absolutely amazing if you look at the investment
[00:17:50] data uh of women health companies in the united states that have been founded over the past several
[00:17:56] years we've actually seen that decrease materially actually so you know a little girl math here like
[00:18:04] how do we square that circle because the compelling interests of you know these these societal
[00:18:11] impacts that are even measurable they don't always line up against um investments that are being made
[00:18:18] i mean just what you know what what should we think about that yeah um i'm really glad that you
[00:18:25] brought this up because it's something i'm very passionate about um so there's there's multiple
[00:18:33] causes for this but if i think about there being two main buckets from my vantage point um
[00:18:40] you know part of it is you know the decision makers that investment firms
[00:18:47] um and how that mix is evolving and i think we have a lot of progress to be made um but there are more
[00:18:58] and more general partners that are women at investment firms and that has an impact on the types
[00:19:03] of companies that investment firms will invest in um you know myself along with my partner Holly
[00:19:11] Maloney at the firm you know we probably invested in a number of women's health companies right and
[00:19:16] that's only going to continue and i hope to grow within the firm and you know we'll just be investing
[00:19:21] more and more in the space um on the other side i think there's a lot of structural challenges
[00:19:29] around lack of investment and women's health care right women aren't just smaller men and so some of
[00:19:37] the statistics around the lack of funding and research around women's health um is gonna take
[00:19:46] time it's gonna take time to kind of dig ourselves out of that hole and i think you know there's more
[00:19:52] kind of political attention on a investment attention pressure from society right um and
[00:20:00] that's going to lead to more research right and then i think we'll get this
[00:20:04] of snowball effect that will create a more um kind of fruitful environment for companies to be built
[00:20:13] in the space you pair that with you know more um decision makers at firms being women and i think
[00:20:21] the future looks really great well i hope so and i think that you know the more that we can accelerate
[00:20:26] that and i really appreciate you talking about the various angles of where the problem actually lies
[00:20:32] it is not that there's not enough innovation out there it is not that there's not a pipeline
[00:20:38] of excellent entrepreneurs who are willing to focus on this um but we also need people like you
[00:20:45] on the side of the table that can really um just identify with these issues in important ways
[00:20:52] so thank you can't just for talking about that um if we were to just to look out optimistically and
[00:20:58] you seem to be an optimist at heart uh what how far do you think we can bend whether it's the
[00:21:06] cost curve or anyone of the very large back row issues um in health care based on the type
[00:21:13] innovation work that you're focused on yeah um i you're right i'm very optimistic um i think that
[00:21:25] the change we're we're looking to see um is going to come in a couple of forms right there's kind
[00:21:32] of smaller incremental changes that will happen that are really critical um and then there's some big
[00:21:38] transformational changes that happen once in a generation and i would argue that we are in
[00:21:45] the early stages of one of those very exciting transformational changes and that is around AI
[00:21:52] um i focus the vast majority of my time on tech and appled services in health care
[00:22:00] and one of the kind of leading issues we're facing is around labor shortages nursing shortages um
[00:22:09] and the idea that we can leverage technology right we we're not talking about replacing
[00:22:19] people um but leveraging technology so nurses can do what nurses want to do right
[00:22:27] doctors can do what doctors want to do that is providing care right they want to provide good care
[00:22:35] and so i'm very excited about AI's ability to um you know just kind of supercharge the ecosystem
[00:22:45] so that we can build larger companies that can serve more people in an economically sustainable way
[00:22:54] larger companies mean they can employ more people right that's positive for
[00:23:00] the local economies that they're in and so i'm very excited i'd be lying to you if i said oh
[00:23:07] in 10 years this is the percentage of GDP we're going to be spending on health care um i don't have
[00:23:13] visibility into that um but i think AI will be a real accelerator for it but we've also got to
[00:23:21] be careful and i think that um general catalyst has been a real leader um given our focus on responsible
[00:23:30] innovation to make sure that um you know the regulation around AI how companies deploy AI is
[00:23:37] done in a very responsible way because there are some um potential of unintended consequences
[00:23:45] that we need to be eyes wide open about especially when we're talking about people's health
[00:23:49] absolutely absolutely i i just couldn't agree more i mean it's hard to imagine but it hasn't
[00:23:55] even been 18 months since AI came crashing onto the healthcare scene um with so much you know
[00:24:02] enthusiasm excitement um nothing has gone that fast in my lifetime for what i've seen in
[00:24:10] healthcare so the opportunity is there um but that that responsiveness the transparency that's
[00:24:17] needed in AI um is also critical maybe that just brings us to what i'd love to close out on
[00:24:24] if you wouldn't mind Candace we're recording this during black history month um and i just wanted
[00:24:31] to maybe go and back to you a bit about yourself what does black history month mean to you how can
[00:24:37] can you give us a little bit on that yeah um well to me black history is american history
[00:24:45] right it's it's global history and i was very fortunate to be raised in a home where
[00:24:53] there's a lot of value placed on understanding history where you come from
[00:24:59] exposed to a lot of books uh historical figures and so it's always been core to how i think about
[00:25:10] american history um and so for me i you know it's encouraging when um i see more focus broadly on
[00:25:21] black history um during the month of february because it feels like we are
[00:25:27] making progress and closing some of these gaps that exist between um you know people who've had
[00:25:34] different life experiences in different exposure um to kind of fill in some of these these holes
[00:25:41] that exist because it like i said it's it's american history and it serves all of us if um we have
[00:25:49] kind of a clear picture of kind of what got us to where we are today so we can make sure the
[00:25:54] future is brighter and i think that future gets so much brighter when we have more people more women
[00:26:01] more black women more people around important tables making big decisions and in your case you know
[00:26:08] spawning innovation investing and innovation which we know is going to be so critical to change the
[00:26:14] course of some of these dynamics and trends in health care can't necessarily appreciate this um
[00:26:20] conversation on inspiring women one last question for you if you were just to give some advice to other
[00:26:27] younger women who are starting out whether it's a being a journalist or wanting to be a journalist
[00:26:32] or wanting to go into finance what advice might you give to them yeah um my advice would be to
[00:26:41] don't doubt yourself you know if you've done the work um show up with confidence and um
[00:26:52] yeah i think that i think that's my my advice show up with confidence i see too often um you know
[00:27:00] people getting confused um by you know confident or they confuse confidence with competence
[00:27:12] and i think women in particular can sometimes do so much work in the background and be so
[00:27:19] incredibly confident um but then you know self-doubt can creep in and it undermines um how much
[00:27:28] value we can actually add so don't doubt yourself tell me just tell me what the tennis is all about
[00:27:35] i'm a huge tennis fan oh yeah um so i grew up playing tennis um my parents didn't play tennis
[00:27:43] but my dad was a big fan of sports and arthur af and so we just you know went to wall martyr
[00:27:51] something and found local courts and he kind of threw balls at my sister and i
[00:27:56] and ended up playing pretty competitively in the southeast region going up didn't play in college
[00:28:04] and then when i graduated from college i had this itch to play tennis again um and i was searching for
[00:28:12] tennis courts near me and i found an organization called kings county tennis league and i thought
[00:28:18] oh perfect this is probably some league where i don't have to wait hours for courts because playing
[00:28:25] tennis in new york city it isn't the most efficient unless you want to spend a ton of money on private
[00:28:31] courts um and the more research i did i realized oh this is a non-profit i said oh well let me show up
[00:28:38] and so um for seven years now i've been teaching uh children who live in new york city of public housing
[00:28:49] in bedstuy and brooklyn on the weekends it's um may through october and it has been one of the
[00:28:58] most fulfilling things have ever been a part of so um i i'm often on the court where i teach kids who are
[00:29:04] like you know four years old to eight years old um and we take them to the us open every year
[00:29:11] and it's been fun to see a lot of them um kind of grow and get better at tennis and one of the younger
[00:29:18] ones that i taught is um now a coach in the program and he is at john j college
[00:29:26] um studying forensic science and it yeah it's it's been really incredible so these days i mainly
[00:29:35] coaching small kids and on rare occasion i play actual tennis with other adults
[00:29:42] well as a huge tennis fan i'm hoping that um you know the kids that you coach and i'm sure they
[00:29:48] will be as successful as the investments that you make new york company thanks for sharing that
[00:29:52] i've been speaking with kandis Richardson and this has been an excellent conversation kandis thank you
[00:29:58] so much thank you lory this was really fun this has been an episode of inspiring women with
[00:30:03] lori magraa please subscribe right in review we are produced by kate kruz at executive podcast solutions
[00:30:11] more episodes can be found on inspiringwomen.show i am lori magraa and thank you for listening