INVESTOR SPOTLIGHT: Mark Castleman, Sloan Fellow MBA, MIT’s Sloan School of Business; LP in three startup funds and Venture Partner/ Limited Partner at Capital Factory

Every month we spotlight people from our incredible network who support MATR Ventures and our mission to change the game in Venture Capital and actively invest in the Underestimated founder.

We are honoured to spotlight Mark Castleman, Sloan Fellow MBA, MIT’s Sloan School of Business; LP in three startup funds and Venture Partner/ Limited Partner at Capital Factory.

What was your biggest investment mistake? How did you overcome it?

Wow. To find the biggest mistake is quite a challenge. Any investor or entrepreneur will have to admit that the volume of mistake making is simply massive. With so much breakage how do I pick the biggest?!

To answer the question specifically associated with being an investor, I would have to say that the biggest mistake was early on in my direct checking writing: I was making investments directly into companies and this represented a shift from investing in my own companies to investing in other companies run by others.

Finding companies and founders is the challenge all investors face and for me, I was new to the program and I thought the best path would be to reach out to other investors and ask them about various deals or opportunities. This proved to be a mistake as you will see.

In the process of reaching out to other investors I was opening myself to the investment bias of others versus looking at the companies through my own lens, and evaluating them based upon my years of hard fought entrepreneurial experience acquired through successes and failures.

Most of the guidance I received was to make investments in the companies that these other investors had already invested in. At the time I was thinking, “Wow, they are giving me access to their choice deals.” In fact, I was simply getting their recency bias coupled with their confirmation bias. I wasn’t necessarily getting the best companies. The result was that I did end up investing in a person I thought was a great entrepreneur; although they had a marginal idea. You know, “rock star” person, great past companies (actually very long past with no recent successes). On the marginal idea, I thought it would be solved. I thought the founder and company had good enough instincts to sort out their issues and land a killer solution in a huge market, which in this case was around customer marketing and acquisition.

In the end, it was a total loss. The weirdest part was that the founder ended up being so engrossed in pride of their prior success they could not see the cliff (demise) that was fast approaching. Five days before shutting down the company, they even sent a “record performance” update to the investors. It was a disconnect from reality that I had never experienced on the part of a person I trusted with making sound reasonable decisions.

It stung a bit, for sure. It is never fun to lose money and even less fun when it comes with some shade. Hard fought losses are bearable but this one did not have that integrity. I overcame the loss by recognizing that I had a duty to my own investment approach and to maintain consistency even with others telling me to go one way or another. I also learned that investors are also not perfect and it is wise to be aware of human realities when taking investment recommendations.

What was the biggest factor that contributed to your success?

Each person is a constellation of many attributes so this one is particularly tough to answer, moreso when considering the factors I believe contribute to my success versus the factors of me that others believe contribute to my success.

With somewhat of a biased view of myself, I would have to say that the single biggest factor contributing to my success is a desire to show high quality work in whatever work product or object I produce. I have always thought that good work is noticeable even if not completely understood. For that reason I like my work to “look good”. As Billy Crystal used to say on SNL, ‘if you look good, you probably feel good…and you look marvelous!”

What was the one book that has influenced your path?

Without a doubt it would be “Thinking: Fast and Slow” by Daniel Kahneman.

If you could name one thing you’re most proud of, what would that be?

Raising 4 wonderful, caring children who have grown into fantastic adults!

Why have you chosen to invest in MATR Ventures?

For me, it has become exceedingly clear that great humans, great innovations and great outcomes occur throughout time and history and they originate out of many places, cultures and peoples. It is impossible for me to know which one will produce the next great cultural gain or human benefit. I also believe that humans can do amazing things but I do not have the ability to see them all. I need to partner with others who have great vision to seek out and find the future makers.

MATR is an investor with vision who sees through a lens that enables them to see what I cannot, where I cannot. I trust their vision and know that they will find the future makers who will make a difference for all of us.

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