Exec Nike on what she is looking for in venture capital investments
- Melanie Strong is a former executive of Nike and managing partner of Next Ventures.
- Strong co-founded Next Ventures with former cyclist Lance Armstrong in 2019.
- The company invests in businesses that “create access to a healthier life for the broadest population”.
Next Ventures, the venture capital firm of former Nike executive Melanie Strong, is part of an emerging ecosystem of venture capital options for sports tech companies. The firm was launched in 2019 with former professional cyclist Lance Armstrong.
Strong and Armstrong, who were stripped of their seven Tour de France titles after a doping scandal, are unwilling to invest in businesses for elite athletes. They focus on the opposite end of the spectrum.
âWe are investing in businesses that create access to healthier lives for the widest possible population,â Strong said.
Austin, Texas-based fund grows as even larger institutional investors pay more attention to sportswear, such as SoftBank, which this month announced a $ 400 million investment in the company Californian sportswear company Vuori Inc.
Other players include Forerunner Ventures, KB Partners and Sapphire Sport. Nike, Adidas and VF Corp. are among the companies with internal investment arms.
Strong said Next Ventures wanted to invest in early stage companies, typically ones that need a seed round or a Series A round.
The company was launched with a $ 50 million fund raised from 70 investors or sponsors. He’s made 12 investments to date, including Oura, a company that makes a $ 299 ring that collects data on sleep patterns.
Like other investments, Oura investing started with a belief in the founders.
âWe’re looking for a very strong Founder’s Story, ideally a very mission-driven story,â Strong said. “When there is a personal reason why this person started the business, they are more likely to weather the inevitable ups and downs.”
Strong said investing in Oura is also a gamble that a simple ring worn on the hand is the best way to track sleep, as well as his belief in the company’s scientific research.
Strong said she sees investment opportunities in companies that make all kinds of wellness tech equally accessible, including around sleep, mental health and coaching.
Next Ventures is an investor in Hammerhead, which describes itself as a ânext generation cycle computerâ. It has also invested in Kinetyx, which develops smart insoles for sports shoes.
âThere is an opportunity for innovation to solve this fundamental problem of how to live healthier lives,â Strong said.
Strong doesn’t have a traditional VC background: no MBA, no sleepless nights crunching numbers as an intern on Wall Street.
She joined Next Ventures after a 17-year career at Nike, during which she became Vice President of Global Skateboarding and Vice President of Global Marketing for Women.
Strong is considered one of the female executives who have confronted management with corporate culture and pay equity issues, a moment that continues to spur change within the company and has coincided with the Nike president Trevor Edwards leaves the company. Strong said she learned her most important professional lessons at Nike, including how an inspiring mission can motivate a team and the need to “create space for different styles of leadership.”
âI wanted to be an investor in a new generation of founders and companies that would focus as much on creating a positive culture and community as on generating positive growth and returns,â said she declared.
Founders who worked with Strong said her lack of pedigree was an asset, as was her perspective as a half-Asian female executive.
Strong’s mother was born in Japan. She lived there as a child.
âShe has a whole new perspective,â said Lynn Le, founder and CEO of Society Nine, which promotes itself as a modern women’s boxing lifestyle brand.
Strong has known him since 2018. Strong has since become a personal investor in Society Nine.
âAs an Asian leader in sportswear, it’s such a cheesy saying, but you can’t be what you can’t see,â Le said. “She’s emblematic of the type of leader I want to be.”
The first fund of Next Ventures is deployed at a little over 50%. Strong said she would start planning for a second fund soon.
“How big will it be? Who are we going to recruit as strategic LPs? We’ll have a good idea by the end of the year.”