The Career Legend with Susan Lyne

Liz Tinkham (00:00):
Hi, this is Liz Tinkham and welcome to Third Act, a podcast about people embracing the third act of their lives with a new sense of purpose and direction. The third act begins when your script ends, but your show is not finished.

Liz Tinkham (00:21):
Hi everyone, and welcome to Third Act. On today’s show, I talk with Susan Lyne, the career legend. Susan’s resume reads like the magazine cover story of someone you want to be. From her early days in college dropping out of UC Berkeley to work on a magazine with none other than Francis Ford Coppola to then going on to green light Grey’s Anatomy and Desperate Housewives while at ABC to becoming the CEO of Gilt Groupe, one of the first online shopping and lifestyle websites featuring designer clothing. But she says her legacy for her daughters will be what she’s doing today, founding and running Built By Girls Ventures, an early stage fund backing female founders. Oh, and did I mention that she’s a Forbes 50 Over 50 Impact winner too? Join me for this discussion with the fabulous Susan Lyne. Good morning, Susan. Thanks so much for being on the show. Where do I find you today?

Susan Lyne (01:14):
I am in New York City. I’ve just finished… I was in Miami for four days for a long postponed weekend visit to a sister and then in San Francisco to teach a class at UC Berkeley and now I’m back.

Liz Tinkham (01:30):
As I mentioned in my intro, you’ve had a spectacular career and continue to build on it. So this is beyond the third act story, but you didn’t finish college.

Susan Lyne (01:39):
No.

Liz Tinkham (01:39):
So how does a smart girl from Boston go to UC Berkeley and end up dropping out?

Susan Lyne (01:43):
I got out there largely because I thought there was a bigger world. And I’d grown up in Boston in a large Irish Catholic family, lots of aunts and uncles, lots of cousins. I always felt like I was under a microscope to a certain extent. It was the ’60s. It was the very end of the ’60s and the world was changing. There was so much transformation in politics, in culture, in movements, the civil rights movement, the anti-war movement, the women’s movement, and I was really drawn to people who were engaged in that change. So Berkeley was like a Mecca and I went out there and it was, I think, really transformational for me. It did let me kind of create my own sense of where I wanted to be and what I wanted to do. And I got very interested in magazines, publications, alternative newspapers.

Susan Lyne (02:45):
I wrote for the Berkeley Tribe when I was in school. I did fact checking and research for a couple of magazines out there, and then I knew I wanted to go into magazines. This is way before the internet, as you know. And so if you wanted to impact the way people thought, the way you did it was to go to work for a newspaper or a magazine. I managed to talk myself into a job as the assistant to the editor-in-chief of a new magazine called City that was started by Francis Coppola in San Francisco. It was sort of his version of New York Magazine for the Bay Area. And I knew the editor this much.

Liz Tinkham (03:29):
She’s signaling very small. So this isn’t… Which was like barely you knew the editor.

Susan Lyne (03:35):
Yes. But enough to be able to get in to make a pitch for a job. And he said, “Look, I will hire you to be my assistant. It sounds like a bad job. It’s the greatest job in the world if you want to go into magazines.” And he turned out to be right because I got to sit in on every meeting, I got to see how stories get assigned, what the editing process looked like, what production was like. And it was incredibly exciting and I just never looked back.

Liz Tinkham (04:08):
You said you wanted to change the world and reinvent yourself. So you did that by getting into magazines or do you feel like you fulfilled that while you were at Berkeley?

Susan Lyne (04:17):
That was the trigger for my going out to Berkeley. I think once you… And I certainly was deeply involved in both the anti-war movement and the women’s movement while I was out there. So yes, I was an activist when I was in school, but I would say getting into magazines was really about what do I want to do with my life and how can I combine these things of wanting to impact the way people think, but also to do work that is rewarding and challenging and impacts the world?

Liz Tinkham (04:55):
You went from magazines to Disney to ABC. All media, but different formats. So what is it about media that allowed you to sort of find your niche?

Susan Lyne (05:04):
I didn’t realize until I moved from Disney and I did work for the studio, which is the film department for a couple of years before I moved to ABC, and I learned pretty quickly that I didn’t love the movie making process because you’re really working in a vacuum. You’re not getting feedback from your ultimate audience as you’re developing that. Now, I’m sure there are today many, many ways people do that, but at the time, it was very much a process where you found a property or you assigned a script, you developed it sometimes over years and finally it got financing and it was produced and then you held your breath and you hoped that audiences were going to love it.

Susan Lyne (06:02):
It was not what I was used to with magazines, which is you put out a magazine every month or in some cases every week and you’re constantly getting feedback from people, the stories they like, the writers they like. And so when I had a chance to move over to ABC and my first job there was running what was called longform at the time, which was movies and miniseries. And this was a period where the networks were still doing 20, 25 movies a year. So I loved it. I loved the speed of it, I loved the collaborative nature of it, and I especially loved series once I moved over to that side of the business because again, you’re getting that constant feedback from your audiences about who they like, right? What they like.

Liz Tinkham (07:00):
Yeah. So you’re quite open about the fact that you got let go from ABC. Can you tell us a bit about what happened and more importantly, sort of what were the learnings for our listeners?

Susan Lyne (07:11):
It’s the one job I’ve had where I felt like I didn’t finish it. And I had been appointed president of entertainment in 1992. My direct boss was a guy named Lloyd Braun who I loved working with. We were a good team, and he butted heads with Michael Eisner frequently. This was in the last years of Michael’s leadership at Disney and Lloyd was not the only person who butted heads with him, but he did. And in mid 2004, Lloyd was let go. Bob Iger, who was my next boss, said that he had total confidence in me and wanted me to take on more, not less, and just to sit tight because he had a bunch of things he was going to have to figure out here.

Liz Tinkham (08:09):
And is this before Bob is the CEO or is he CEO?

Susan Lyne (08:13):
Yes. Before he was the CEO. So this was the year before he was appointed CEO and the year before Michael Eisner retired. And what became clear to me during the next few weeks as people began jockeying for, how was Lloyd’s job going to be carved up? There was one person in particular who was running the television studio who really wanted my job. He had been angry when I was appointed to it initially and he really wanted it now. And he said very clearly, “I am not going to report to you. I will not.”

Susan Lyne (08:51):
And I got back channel information from multiple people that he and a couple of other guys were trying to figure out a way where they could carve up Lloyd’s job and mine and all get what they wanted, but it would mean that I had to go. And I just assumed that Bob would take care of it and that I would keep my job. But two, three weeks later, Bob called me in and said, “You know what, we’re going to go a different way.” And it was devastating to me particularly because we had a schedule we were going to launch. This was now May of 2004. So we had picked up all the shows for the fall. And in that schedule were Desperate Housewives, Grey’s Anatomy, Lost.

Liz Tinkham (09:52):
This was all about to start?

Susan Lyne (09:53):
Yes, this was all about to start.

Liz Tinkham (09:54):
Okay. Wow, that’s a roster.

Susan Lyne (09:57):
Yes. And it was not accidental. So I will tell you what I had realized, and it was definitely an aha moment, was that programming for women, girl shows were just not being produced anymore. There was an accepted wisdom that women would watch a show made for men, but men would not watch a show made for women. So studios were chasing essentially CSI, Law & Order, those kinds of shows. And even though DVRs were now available or at least VCRs were, they were still very focused on closed stories. So things that you could enjoy a single episode of, Law & Order being the perfect example, and not narrative storytelling because, again, even people who said they were avid viewers of X, Y, Z series actually watched fewer than two episodes a month. So two out of four. And so the possibility of somebody getting lost as a result was definitely there.

Susan Lyne (11:23):
What they weren’t factoring in is that now that you could save a show and you could view it later, this was going to change. But we were still in that period of time where nobody wanted narrative storytelling. So Lost was very much one of the first shows that tried to go back to that idea of narrative storytelling and both Grey’s Anatomy and Desperate Housewives were part of this initiative. We put a stake in the ground and said, we’re going to find the next girl show. The next show that women gathered together to watch. Things like Ally McBeal and Sex and the City and Melrose Place, those were all off the air now and it worked.

Liz Tinkham (12:18):
So you end up back in New York and you go to Martha Stewart Omnimedia. Was this before or after she went to jail?

Susan Lyne (12:23):
It was before. I joined the board… When I left ABC, I decided to take the summer off, but I did join the Martha board. I knew her a little, but I had been a huge admirer of what she’d done. I loved the brand. In fact, I had tried to get Disney to consider making a big investment in it when they were still a private company, and she had been convicted at that point. One of the things that became clear as a board member was that the company was not going to recover until Martha actually went to prison. So a normal person who did not have a public company that was depending on them would have appealed and she had every right to do that. In fact, I think she had a good chance of winning on appeal, but advertisers had fled and the company had gone from being very profitable to really bleeding cash.

Susan Lyne (13:38):
So we urged her to go to Alderson, right? Get this behind her. She was amazing. She did it. And it was part of that process when the decision was made that she would go to jail, we knew she was going to be in West Virginia for five months and another five months of house arrests. So there needed to be someone who took that CEO role and actually steered the company during that period of time and I was asked to do it. And it was my first CEO role. Not surprising that I was given that opportunity when the company was in free fall. That’s often what happens to women, but it was definitely something I embraced.

Susan Lyne (14:36):
And there was a lot of work to do. We rethought the merchandising business and diversified away from just Kmart to six or eight large contracts. We spent a lot of time thinking about how Martha could get back on television because CBS had canceled her show the minute she was indicted and NBC picked up a live morning show for Martha. And maybe most importantly, we also invested very heavily in digital. So this was 2004 and 2005. And so it was still early days for content companies to really dive heavily into this, but we did and I think it set the company up well for the future. I stayed for four years.

Liz Tinkham (15:32):
She came back during that period.

Susan Lyne (15:34):
Absolutely.

Liz Tinkham (15:34):
She was only in audition.

Susan Lyne (15:35):
Yes, yes, yes. And in fact she was critical, even under house arrest, she was critical to getting advertisers to come back, re-embrace the brand. By the way, her customers never left. If anything, we saw an uptick in two year subscriptions instead of one year subscriptions. And I think women were quietly trying to support her. They thought she’d gotten a raw deal. She was initially indicted for insider trading. That was thrown out. And it was really obstruction of justice; it was what happened during the investigation that she ended up going to prison for.

Liz Tinkham (16:23):
After Martha Stewart, you continue to do so many cool things like run Gilt Groupe, but then you joined Tim Armstrong at AOL. And what did you do there?

Susan Lyne (16:31):
Well, let me back up a second because even while I was still at Gilt, I joined the board of AOL when it was spun out from Time Warner. And Tim, who I’d met a couple of times before, was a force of nature. He’s an incredible guy. He had been hugely successful at Google and he was willing to take on this company that had been left for dead. He believed that he could use the free cashflow that was still coming in. This company kicked off a lot of capital for many years after people kind of realized that it was not the future, but he believed he could use that capital to transform the company before it ran out. So every year, subscribers were going down, but still a lot of money coming in and he really made a bet that he could change the way the company was perceived, but also what their business model was.

Susan Lyne (17:41):
And he invested very heavily in ad tech, marketing tech. This was a time where programmatic marketing and advertising were growing dramatically. It was the only way you could really scale the kinds of companies that were emerging during that period of time. My job was to run the content companies. So there were about 45 brands that were part of AOL at that moment. Everything from TechCrunch to aol.com, to MapQuest, to The Huffington Post and on and on. It actually turned out to be more of a restructuring job. We consolidated down to about 13 or 14 brands. We closed a lot of the brands. Not my favorite job in that sense, but this idea of starting a fund to back female founders, which had started percolating when I was at Gilt because Gilt became a magnet for this growing ecosystem of women who were building companies, especially in New York City.

Susan Lyne (18:56):
And I had started a breakfast for female founders at Gilt, monthly breakfast, and they all had the same stories about raising money. They would go into a room full of guys. This was a time when 94% of all the investment partners in venture capital were males. And they had very similar backgrounds, very similar histories, and a lot of assumptions about what kinds of companies could work or not. And someone like the founders of Rent the Runway would come in and talk about renting dresses and they would look at them like they were from Mars.

Susan Lyne (19:39):
I started thinking about whether there might be an opportunity there, given that there were many, many more women who were starting companies and I knew from every job I had ever had that women were and are the dominant consumer, not just in the obvious sectors like beauty and grocery and fashion, but literally everything. What insurance you buy, what house you buy, what car you buy, what healthcare plan you adopt. So it made sense that if you could find great founders who were building for a consumer they intuitively understood that you could actually make a lot of money.

Susan Lyne (20:34):
Tim became our first LP. So I partnered with another woman who I brought into AOL when I first joined. A woman named [inaudible 00:20:44] who was 30 years my junior and every bit my equal. I convinced him to put up small proof of concept fund that would allow us to see whether we could, one, get the deal flow. Would founders come to us? Would they want us on their cap table? And two, could we choose well and help steer these founders to successful companies?

Liz Tinkham (21:13):
And it was women founders. So that was…

Susan Lyne (21:15):
Female founders.

Liz Tinkham (21:16):
And did you come up with a name then, BBG?

Susan Lyne (21:19):
We did. It’s a hat tip to a program that my partner ran while we were at AOL that was called Built By Girls. It was a mentor matching platform for young women from diverse backgrounds and young execs at tech companies to help them understand how to get their first jobs. But really we loved the name. And so we just took the initials. We never say Built By Girls Ventures. It is always BBG Ventures. But when someone says, “What does the BBG stand for?” And we say Built By Girls, it always gets a smile.

Liz Tinkham (22:10):
And who came? Did you have any trouble attracting women founders? Did they find-

Susan Lyne (22:15):
Not at all.

Liz Tinkham (22:15):
I was going to say they had to found you right away?

Susan Lyne (22:17):
Not at all. Yes, absolutely. One of the things that became clear very quickly, we were one of two funds that put a stake in the ground and said we’re going to back female founders. This was in 2014. So this was a new idea and it was in part because there was, by then, enough women who were building companies that you could actually get great deal flow as a result. We also did not… This was not about backing only women. So many of the companies we backed had male, female teams. Our gating factor was always there has to be at least one female founder on the founding team because we believed that was a competitive advantage.

Liz Tinkham (23:11):
And how many funds have you raised so far?

Susan Lyne (23:13):
Three.

Liz Tinkham (23:14):
Wow.

Susan Lyne (23:14):
So we’re on our third fund. It’s a $50 million fund. We’ll go out and raise another one in the second half of this year.

Liz Tinkham (23:21):
We just did a whole thing on venture investing as part of this podcast. So someone who does this full time, you, what are you and your partner looking for when you look at founders?

Susan Lyne (23:30):
We’re looking for someone who has a big vision, right, sees an opportunity and a system that’s broken. In some cases, a product that’s missing, but very often this is not about consumer products. I can talk about a few of the consumer products we’ve backed, but the bigger opportunity is when women are trying to take on a problem, a societal problem, and create a new solution that will be available to millions and millions of people.

Susan Lyne (24:09):
So a good example of that is a company like Spring Health. That male, female team, female CEO, and they sell into companies and take over mental health care for companies. So because they have a massive database that they’ve been able to tap into and to write algorithms against, they know based on a questionnaire, a dynamic questionnaire, what kind of medical help you need. So it could be that they steer you to a psychiatrist because you need prescription. It could be a therapist. It could be a gym membership, but they promise to get you to the right kind of care and to a person who they believe is a good match within 48 hours, which is very unusual.

Susan Lyne (25:06):
And they’ve been hugely successful. This is an issue that if anything, has grown during COVID, and I think there is also a generation of women and men that I would say, particularly women, who are trying to take care of their mental health earlier rather than later. They’re not waiting for a crisis. So we backed another mental health company in fact in this latest fund that is earlier stage still. They just raised a series B. It’s called Real, that is doing asynchronous therapy along pathways that drive a lot of anxiety and depression in millennial women. So whether it’s body image or it’s parents’ approval or it’s not being able to find a mate. They create 10, 12 session therapeutic pathways that you can participate in on your own time.

Susan Lyne (26:13):
And you get to interact with the therapist in between sessions, but it’s been very successful. And I would say not just very successful in being able to raise money and to attract users, but they just did a trial to see what the efficacy was and the results were really, really strong and particularly strong with Medicaid patients, which is hard, but yes, incredibly important.

Liz Tinkham (26:54):
So many of our listeners are sort of first time older female entrepreneurs, of which I know the cohort group is growing quite dramatically. So do you believe there’s a perceived age bias at all in venture in founders? And if so or if not, any recommendations for how an older female founder might raise money, get started? Any advice along those lines?

Susan Lyne (27:17):
I would say, yes, there’s an age bias everywhere, right? I think we all see it in our daily lives and it would be silly not to acknowledge it. But that said, I think there is a strong conviction right now that there’s a huge opportunity in addressing the needs of this older population. So as you know, the country is aging. There are 10,000 Americans turning 65 every day. As fertility rates shrink, the proportion of older Americans is that much greater. There are funds that have launched that are specifically focused on founders who are building for that consumer, whether it’s over 50 or over 65. And I think that’s going to grow.

Susan Lyne (28:18):
I’m going to block the name of Abby Levy’s new fund, but if you… Abby Levy, she’s been very smart to really hone in on aging in America as a huge opportunity. And I will say that I’ve gotten more interested in it in part because of my own age, but also I was lucky to be on Forbes Initial 50 Over 50 list. It triggered a memory about reading something probably 15 years ago. I did go back and find it. It was a piece that had run in Lancet, which is a medical journal, back in, I want to say 2009. But essentially, it posited that children born that year, actually, I think they said 2007. So a couple of years before this was published. In the developed world, 50% of them would live to be 100.

Susan Lyne (29:28):
So when you start to combine the fact that we have a growing aging population and additionally, that longevity is increasing, it becomes that much more important to figure out, one, how are we going to engage this older population? We have to think differently about retirement. 65, if you’re going to live another 35 years, that doesn’t really work. So how do we rethink a life so that it’s about chapters and not just a single career?

Liz Tinkham (30:06):
Yeah, there’s a great book called The 100-Year Life. I don’t know if you’ve read that. Basically says you’re going to work till you’re like 85. So you better really think about it in terms of chapters as opposed to one, two, and three like maybe you and I were thinking of. So I was looking at your website and looking at all the faces of your founders, which is wonderful because it’s like such a diverse group of young women and men. So what do you learn from working with a group? Give us a couple of fun things that you’ve been able to glean working with this crowd.

Susan Lyne (30:36):
One is that they are so much smarter and more focused than I was at that age. I have to say I was very reactive for most of my career. I would be offered a job and I would think about it and I would either decide, yes, this is really something I want to do, but I never had a life plan. I’m not sure life plans work, but I do think that if you have a goal, to understand what you are going to need to accomplish in order to get to that is actually incredibly valuable. Everybody who I’ve met, and it’s not just the founders, it’s people who choose to work at startups, whether they’re doing growth marketing or they’re engineers or they are operational support. These are people who have chosen to work in a high growth, high risk setting. And it’s not for everyone, but the people who are drawn to it I think are really exceptional. So that part of it’s really fun.

Susan Lyne (31:52):
The other thing that is notable, and you mentioned it, our founders are very diverse. So 70% of our founders are people of color and 35% are either Black or Latin. And that is really a reflection of what’s happening in the country. We are becoming very quickly a majority, minority country. That will actually be true with Gen Alpha, which is the next generation after Gen Z. So these are kids who are now in their mid teens and younger. We did a really interesting piece of research for our last annual meeting where we looked at each generation starting with the boomers. When they were 17 to 22, what was the racial makeup of that group? For boomers, when we were 17 to 22, the country was 81% white. We were 81% white, that 17 to 22 year old group. By the time you get to Gen Z, it is 52-48. So 52% white, 48% other races. And we can’t get the 17 to 22 numbers for Alpha, but we did look at the census for Alpha and they are 52% minority.

Liz Tinkham (33:35):
I somewhat see that too, because I teach at the University of Washington. And so I see mostly juniors and seniors, but you can see the change in the group there as well. So I think it’s great.

Susan Lyne (33:47):
What that means is that finding founders who understand the consumer who’s being targeted by whatever it is they’re building, by the very nature of this increasingly diverse America, you are going to have increasingly diverse founders.

Liz Tinkham (34:09):
Yeah. And they’re going to create products and services that suit them, not that are built for boomers or Gen Xers. Exactly. So I just want to finish up. So I almost titled this podcast I’m Not Done Yet. So I can’t imagine given all the different things that you’ve done, what aren’t you done with yet?

Susan Lyne (34:26):
Oh, so many things. I genuinely enjoy working. I never think about retiring. I would certainly love to spend more time with my grandchildren. I’ve got two stepdaughters and two daughters. My stepdaughters have got four children who are now nine to 12 and my older daughter has got two, a four year old little girl and a baby boy who was born a month and a half ago. So I spend as much time as I can with them, but that is incredibly exciting. But at the same time, I love my work and I love learning. So one of the great things about having a fund is that you are in a constant state of learning something new.

Liz Tinkham (35:22):
New everything. People coming in with all kinds of interesting ideas, I can’t imagine what you see.

Susan Lyne (35:26):
All the time. Yeah.

Liz Tinkham (35:26):
Yeah.

Susan Lyne (35:26):
Yeah.

Liz Tinkham (35:26):
Well, that’s wonderful. Well, listen, Susan, thank you so much for your time. This has been great in bringing all your wisdom to Third Act. Where can our listeners find you online?

Susan Lyne (35:35):
They can find me on LinkedIn, they can find me on Twitter, @smlyne, and I’m also on Instagram too. I’m also available by email although I will tell you, I get too many emails to really catch up very quickly. So you are welcome to try emailing me, [email protected], but please forgive me if I don’t get back right away.

Liz Tinkham (36:11):
Well, I think most people look up people on LinkedIn and also I’ll find Abby Levy’s new fund to put that in there as well. So thank you very much and enjoy the rest of your day.

Susan Lyne (36:20):
It was great doing this, Liz. Thanks.

Liz Tinkham (36:24):
Thanks for joining me today to listen to the Third Act Podcast. You can find show notes, guest bios, and more at thirdactpodcast.com. If you enjoyed our show today, please subscribe and write a review on your favorite podcast platform. I’m your host, Liz Tinkham. I’ll be back next week with another guest who’s found new meaning and fulfillment in the third act of their life.