acquired, H&Q had a very small fund that looked at environmental
issues at our founder Bill Hambrecht’s behest. We were the first
investor in Odwalla [the juice company] when sustainability wasn’t
in anyone’s vocabulary. It wasn’t just an investment success. It
created jobs. It made an environmental improvement.
BE: How did the idea of a double-bottom-line impact fund
come about?
NP: The tech and dot-com booms created a lot of prosperity
but didn’t help the poor neighborhoods of the Bay Area. Commu-
nity groups went to a business association called the Bay Area
Council and said, “Look, all this wealth is not helping our neigh-
borhood. Do something about it.” The Bay Area Council started a
venture capital fund to invest in interesting young companies—but
one that paid attention to place.
The council came to me and to my boss [the late Dan Case]
and asked if we’d be interested in raising and managing the fund.
It ended up morphing many times during fundraising because we
wanted the small companies to drive top-tier returns.
One of the first things we did as an early investor in Tesla in
2006 was to aid its search for a plant to eventually house the
Model S sedan. We showed Tesla that there were ways to stay in
the Bay Area that helped level the playing field against cheap labor
in other parts of the world—using economic development programs
that were already in place, like job-training programs or certain
rent-abatement strategies, because we were going to create jobs.
There’s a whole toolkit that people use.
Now it’s kind of famous because of companies like Amazon,
but back then the only companies that knew about this were big
companies that had the staff to do this. Tesla eventually found the
factory in Fremont, Calif.
BE: How did you first get to know Tesla?
NP: Through a contact at Stanford, Jane Woodward, who runs
Mineral Acquisition Partners. She was very interested in electric
cars. She had us over to learn more—and that’s when we met
J.B. Straubel [Tesla’s chief technical officer at the time]. That was
our first encounter. And we were very excited about it.
Our mission drove us to invest at a time when it was very risky.
It’s well-chronicled that the 2007-2008 period was brutal for Tesla
and [solar panel company] SolarCity. It was very difficult to find
people who would invest, and the businesses were capital-intensive.
There were some pretty scary moments. I don’t think we knew how
much of a phenomenon Tesla would become.Venture Capital
How Nancy Pfund Became
A Cleantech Guru
By BRIAN ECKHOUSE
PHOTOGRAPH BY CHRISTIE HEMM KLOK
NANCY PFUND HAS BEEN turning ideas into businesses for most of
her life. Soldering wires with her inventor father instilled an affin-
ity for entrepreneurs that drew her to venture capital. Pfund made
early investments in companies such as Elon Musk’s Tesla Inc. and
in 2008 spun off a “double-bottom-line” fund—focusing on both
profits and social impact—from JPMorgan Chase & Co. San
Francisco-based DBL Partners, where Pfund is co-founder and
managing partner, has raised a total of $750 million across four
investment pools. Here, Pfund, 63, describes what she’s learned
and where she’s investing now.
BRIAN ECKHOUSE: How did you find your way to venture capital?
NANCY PFUND: I didn’t know what venture capital was when I was
in college. I was very interested in innovation and policy and tech.
I worked at Intel for a few years after business school and then
moved to San Francisco. There weren’t any tech companies there
back then, which is hard to believe, but there were a few VCs and
investment banks that were funding tech companies. I joined
Hambrecht & Quist in 1984 as a securities analyst. But I switched
a few years later to venture capital after realizing that I was much
more interested in private companies than public stocks.
BE: What drew you to cleantech and policy?
NP: Well, my father was a patent attorney and an inventor. My
mother was very involved in campaigns and policy. While in college
at Stanford, I was part of a student group to identify whether gas
prices were transparent. My first job out of college was with the
Sierra Club, and I worked with Stanford Medical School on biotech
policy. So it’s always been in my DNA, kind of that intersection of
where technology, innovation, and the environment meet policy.
BE: What did your father invent?
NP: He invented things that our family needed. Our car got stolen
when I was in third grade. And so, long before antitheft devices
were anywhere near cars, he invented something called a Stop
Thief, which had three buttons that you wired to the steering wheel.
If you didn’t have the right combination of those buttons, the horn
would go off. I have four sisters, and we handled marketing and
manufacturing. We were soldering wires together in the basement
for this product.
BE: How did you get your start in venture capital at H&Q? [H&Q
was acquired by Chase Manhattan Corp. in 1999. Chase became
JPMorgan Chase in early 2001.]
NP: Long before we went public and long before we were
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