One of Silicon Valley’s leading venture capitalists is alumna Cindy Padnos, who has also been a pioneer and advocate of diversity in tech.
Cindy Padnos is an entrepreneur’s best friend.
Padnos, a Carnegie Mellon University alumna, is founder and managing partner of the venture capital firm Illuminate Ventures, which has helped raise and deploy $100s of millions in venture financing for early stage tech companies that leverage new technologies and business models, with a focus on enterprise cloud and mobile solutions. Unlike many Silicon Valley VC firms, Illuminate invests broadly across North America, tapping into the heart of the country, not just the two coasts.
The New York Times named her one of the “Most Influential Women in Silicon Valley,” Fast Company selected her as one of the “Most Influential Women in Technology” and AlwaysOn calls her “A Power Player in the Cloud.”
Padnos said she believes that among her San Francisco Bay area firm’s greatest achievements — aside from their strong investment performance metrics — is Illuminate’s pioneering role in stimulating diversity within the Silicon Valley startup ecosystem and beyond.
“As a female founder of both a venture-backed software company and of a venture capital firm, I recognize the challenges that still exist for women and minority groups in the tech sector,” Padnos said. “We were one of the first to talk very openly about these issues, publishing a white paper on the topic nearly 10 years ago. We then decided to stop writing — and start doing.
“While there is still a long way to go, we’re proud of the part that we’ve played. Without ever using gender or diversity as investment criteria, our efforts to be as inclusive as possible and remove both hidden and unintentional bias have served us well.”
The results speak for themselves. More than 80 percent of Illuminate’s portfolio companies have diverse founding team members — a mirror image of the less than 20 percent industry average, and the firm has not had a single company failure across their 20-company portfolio.
She is quick to credit Carnegie Mellon, where she earned her MSIA/MBA from the Tepper School of Business in 1980, for embracing her liberal arts background and entrepreneurial mindset.
“When I decided to focus my career on business, I realized that I would really benefit from a quantitative MBA program, but sought one where both my background and gender would be valued for the unique perspectives I could add,” Padnos recalled. “What sold me on Carnegie Mellon was my visit to the campus. The difference I felt from other schools in terms of the warmth of the reception and the intimacy of the small class size. The collaborative conversations I had with faculty and students was palpable.”
Illuminate, founded by Padnos in 2009, is typically a startup’s first institutional investor, but also can be a fit for a more established company seeking its first equity financing. She has served as a board director or observer formany of the firm’s portfolio companies including market leaders like Allocadia and BrightEdge,— and has gained successful exits for companies like CalmSea (acquired by Coupang), Opsmatic (acquired by New Relic), Sense Platform (acquired by Cloudera), SimOps Studios (a Carnegie Mellon spin-out acquired by Autodesk) and Xactly (NYSE IPO).
She laughs when asked to describe a typical day for her and her small team.
“Like any successful startup — we all wear many hats and roll up our sleeves on whatever job needs to be done,” Padnos said. “Activities in any single day can range from discovering great new entrepreneurs, conducting diligence on new sectors of interest, writing and syndicating term sheets, speaking at events, leveraging our networks to assist portfolio companies, to raising capital for our new funds. There is never a dull moment! We’re known for helping startups discover product/market fit and for supporting founders through the inevitable crises they face. In the end, it all comes down to working well with people, encouraging one another to think outside of the box and then making the best decisions we can. That’s why trust is the foundation of our business.”
Given her stature in Silicon Valley, she says she has not forgotten her alma mater’s role in her success.
In a show of gratitude, Padnos sits on the Tepper School’s Business Board of Advisors and her firm’s first student-in-residence intern is Nathan Pitzer, a student in Tepper’s class of 2018.