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Don’t be a unicorn, be a dragon


The tech industry and its investors have been captivated by the spell of the Unicorn for too long — and the ambitious goal of a billion-dollar valuation has done more harm than good. Instead, founders should aim to be resilient Dragons. That’s the view of Maëlle Gavet, who as CEO of early-stage investment business Techstars has unmatched insight into the hopes, dreams, and challenges of thousands of founders. Maëlle also shares her experience as a “Fixer and Scaler” and offers important lessons for all entrepreneurs, from pre-seed start-ups to corporate change agents.

“I really don’t like that people are so obsessed with unicorns. It makes you make a lot of bad decisions.”

— Maëlle Gavet
About the guest:

Maëlle Gavet is CEO at pre-seed investors Techstars. Her previous roles include CEO of, Russia’s largest e-commerce site, and executive VP of operations of the Priceline Group. Most recently she was COO at real estate platform Compass. She is the author of Trampled by Unicorns: Big Tech’s Empathy Problem and How to Fix It.

About the host:

Bob Safian is the host of Masters of Scale: Rapid Response, and the editor-at-large for Masters of Scale. He’s the founder of The Flux Group, a media, insights, and strategic advisory firm. He was previously editor-in-chief of Fast Company, where he won the National Magazine Award for Magazine of the Year in 2014.

As valuations for many start-ups come crashing down, Maëlle Gavet’s criticized the goal of becoming a unicorn company. Instead, she says, businesses should strive to be dragons — resilient enough to withstand difficult times and devotedly loyal to their mission and their customers.

— Bob Safian
Transcript of Masters of Scale: Don’t be a unicorn, be a dragon

MAËLLE GAVET: I really don’t like that people are so obsessed with unicorns. It makes you make a lot of bad decisions.

You don’t need to be a unicorn. What you really want to be is you want to be a dragon. Dragons are tough. They are independent. They’re tenacious.

I always wanted to disrupt the gatekeepers of tech. The tech ecosystem does not provide the same opportunities for everyone. We believe that the best investment opportunities are in this untapped potential. This year, we’re going to do close to 600 pre-seed investments.

We have this massive network of 7,000 alumni, 7,000 mentors, 20,000 investors. You are five times more likely to get to a round six of fundraising if you went through Techstars than if you were on your own.

BOB SAFIAN: That’s Maëlle Gavet, CEO of Techstars.  

Known for its accelerator programs, Techstars is also one of the world’s largest pre-seed investors with more than 3,000 companies having gone through its entrepreneurial bootcamps.

I’m Bob Safian, former editor of Fast Company, founder of the Flux Group, and host of Masters of Scale: Rapid Response. I wanted to talk to Maëlle because, as valuations for many start-ups come crashing down, she’s criticized the goal of becoming a unicorn company. Instead, she says, businesses should strive to be dragons — resilient enough to withstand difficult times and devotedly loyal to their mission and their customers.  

Maëlle has played a central role in growing diverse startups and scale-ups. Now, with Techstars, she’s set her sights on remaking the impact of pre-seed investing globally.  

Maëlle’s distinctive perch gives her uncommon insight into the current state of the innovation economy, and she shares key lessons on how to navigate our devilishly complex economic environment.


SAFIAN: I’m Bob Safian, and I’m here with Maëlle Gavet, CEO of Techstars. Maelle, thanks for joining us.

GAVET: Thanks for having me, Bob. It’s such a pleasure to be here with you today.

Maëlle Gavet on why founders should aim to be dragons — not unicorns

SAFIAN: I reached out to you because you recently wrote on LinkedIn about the state of tech and unicorns, responding to some news about the unicorn minting is waning. And you had a comment about it being better to focus on dragons than on unicorns. I feel like we’re in Game of Thrones land here a little bit, but tell me what you’re thinking, why you wrote this, and where you feel like we are.

GAVET: So just for the record, I’m actually a big fan of Game of Thrones, but that was not the reason why. It all started a few weeks ago when we had our LP annual general meetings. And I was having a conversation with Brad Feld, one of the three co-founders of Techstars, about whether or not we should talk about the number of unicorns that Techstars has invested in and supported. By the way, it’s 22.

And that got me thinking the number of unicorns that any investors makes is like one of these really key numbers that people focus on. And it’s completely artificial because most of them are paper valuation. And as we’ve seen last year, this is a valuation that is not supported. And it also has negative consequences because as an entrepreneur, to get big fast, to grow at all cost, it makes you make a lot of bad decisions.

I was talking to our entrepreneurs and telling them, “Don’t be a one-trick pony. You don’t need to be a unicorn. What you really want to be is you want to be a dragon.” Dragons are tough. They are almost invincible. They are independent. They’re tenacious. They may not be as pretty as unicorns, but I think for an entrepreneur, that feels like a much better animal to try to emulate.

SAFIAN: Now, in a business sense, being a unicorn basically just means you’re valued by someone at a billion dollars or more, which is an achievement and, I guess, a marker that companies strive for. What is the business characteristic of a dragon?

GAVET: In the world of business, being a dragon means that you need to be able to resist any challenges, any economic downturn. They tend to have really good unit economics. They tend to be very loyal. Again, back to Game of Thrones, if you watched it, you know that the dragons were extremely loyal. When you think about dragons in a business sense, I see entrepreneurs who are very loyal to a problem, very loyal to a customer’s needs. They go through battles to solve these problems.

Differentiating between the hope and hype

SAFIAN: At this point in the cycle, and for a lot of tech companies, certainly, the idea of becoming a unicorn, the valuations got far ahead of themselves. When you’re looking at companies you’re going to bring into the Techstars fold, how do you differentiate between the hope, the potential, and the hype?

GAVET: To start, we invest extremely early. So we invest at a time where it can literally be like two people and a dog and an idea that seems really exciting.

The second thing is we make a lot of investments. This year, we’re going to do close to 600 pre-seed investments. And because of that, we’re highly diversified. We don’t follow a specific trend. We don’t really have the fear of missing out because we invest across all countries and all types of industries.

And then the last thing is we also have a very different model because we provide a lot more than just capital. I’m an entrepreneur myself. And I remember being in so many rooms with venture capitalists promising me the moon, the stars, and everything in between, besides obviously the check that they were generously going to give us.

And I can count on half a hand, the number of venture capitalists who, after they invested in my company, actually provided support and really, really made a difference in my company.

Techstars not only provides capital, but then we have programs. Think about it as three months, intense entrepreneurship boot camp. And then after the three months, we have a lot of services for you, starting from helping you to fundraise, to helping you hire new talents for your team, connecting you with potential corporate clients, et cetera, et cetera.

Wwe have this massive network of 7,000 alumni, 7,000 mentors, 20,000 investors who have made an investment in a Techstars company. And so because of all of that, we provided a very different investment strategy far, far, far away from all the hype that I can sometimes see in the media.

SAFIAN: And the 600 pre-seed investments that you’re making this year, have all of those businesses been through one of your accelerator programs?

GAVET: They all have to go through the program. When we look at their trajectory, our program makes a huge difference. You are five times more likely to get to a round six of fundraising if you went through Techstars than if you were on your own.

Why Maëlle Gavet joined Techstars

SAFIAN: So you joined Techstars in 2021, so less than two years ago you came on board. What appealed to you about the opportunity?

GAVET: There were really three things that got me beyond excited about Techstars. The first one was: I love working with entrepreneurs. We now have 3,300 and counting companies we have invested in. The second one is I’m a capitalist. I believe, deeply, that entrepreneurship is a force of good, a force of progress, and a key driver of value creation for humanity. And I like to make money. I like to make money for myself. I like to make money for the people around me. I like to see successful entrepreneurs who create generational wealth for themself and for their family and for their employees. And then the last one, which was very, very personal, was this desire to disrupt the gatekeepers of tech. I’ve been working in tech now for well over 15 years, and it is very clear that the tech ecosystem does not provide the same opportunities for everyone. And I wanted to change that.

For the last three years, we had over 25% of the companies we invested in were led by women. When you look at successful Black and Latino founders in the U.S. of the last four years, Techstars has backed more of them than any other investor.

We’re not a DNI or ESG investor. We think of ourself as a universal investor. We want our portfolio to represent the world as it is because we believe that the best investment opportunities are in this untapped potential.

SAFIAN: Are there ways that Techstars is different today than it was when you got there?

GAVET: When I joined, Techstars mostly focused on being a really great accelerator. Accelerators are great, but they’re a means to an end. What we are first and foremost is we are the largest pre-seed investor in the world. And we need to own that, we need to grow that.

The current economic climate for early-stage founders right now

SAFIAN: So you mentioned Techstars is a very broad network, 3,300 and growing businesses. What are you hearing from these portfolio companies about the current economic climate right now?

GAVET: I speak to our entrepreneurs every day. Most of them are first-time founders. It’s not like they’ve done that for 10 years. So most of them have never seen a crisis, let alone seen a crisis while managing a business. And I am constantly amazed by the level of maturity how they approach cash preservation, and how this is a great opportunity for hiring because suddenly they are going to get access to talent that beforehand were completely pulled out of the market by the Facebook, Google of this world. It is very clear right now that B2B businesses seem to feel the pain a lot more than B2C businesses. A lot of big corporations have already started taking measures to reduce cost in Q2 of this year. I would expect that in the B2C market it’s going to come.

And then the other thing, I see more and more entrepreneurs tackling bigger problems than ever because of the economic downturn. They’re like, “Humanity is facing massive problems, and I am going to solve it,” which I find fascinating because when I started in tech 15 years ago, it felt like it was a lot about, “I want to make my life easier.” Now it’s like, “I want to solve a problem, which is going to change the entire world.” You see that a lot in food tech and agritech. You see that a lot in health tech — to climate change and sustainability, in Africa and the Middle East. So there’s pockets of incredible innovation and drive that gives me a lot of hope, even though I expect that 2023 and probably 2024 are going to be very difficult.

SAFIAN: Do you see your entrepreneurs are struggling with how much to pull back versus how much to lean in? I mean, we had the news of Meta laying off 11,000 people, and it makes you think how much you need to rightsize your business or keep your powder dry. Are those conversations that they bring to you?

GAVET: Definitely. The conversation is usually around this trade off. How much do you need to restrain hiring or even unfortunately do some layoff? And at the same time, a lot of them are actually very excited by what’s happening because they’re going to be able to hire the talents that were not available. If you were a small start-up a year ago, and you were trying to hire a chief product officer or a chief technology officer or a strong head of digital marketing, it was so expensive that a lot of the start-ups we had invested in were saying to us, “I don’t think I can hire the right level of talent.” For better and for worse, this is about to change, and it’s a positive for the small start-up because I think they’re going to finally be able to afford to recruit the people that they need to get to the next level.

SAFIAN: Is there a framework that you suggest in approaching this question about balancing the risk in this moment and the potential opportunity.

GAVET: What we usually talk to them about is one, you need to be obsessed about your cash burn and how much run rate you have because there is nothing you can do if you’re about to run out of money. So you need to focus on that first. If you find yourself in a position where you think that you are going to be fine for another 18 months, 24 months, depending on the credit line that you have and the type of shareholders that you have, then it’s the time to think, “Okay, is there opportunities for me to leverage the crisis?”

And we both know there are a lot of businesses out there who did fantastically well during a crisis because they were able to invest when their competitors were not. So we just go through that process. One, let’s look at your cash burn, run rate. If you are in an uncomfortable position, that’s what you need to focus on. Two, if you are in a much better position, let’s start thinking about what are the one or two areas which are going to make a huge difference in your business. And then be very quick at iterating. What I’ve learned having had to deal with this kind of crisis a few years ago is that the key is to be very focused and very agile. You have to be constantly reevaluating your decisions because the environment keeps changing.

SAFIAN: Before the break we heard Techstars CEO Maelle Gavet talk about the top priorities for businesses navigating economic crises.

Now she shares what she learned from running a business inside Russia and the difference between being a wartime CEO and a peacetime CEO.

She also shares lessons about the difference between innovating in a big company and a start-up, the key question she asks every prospective new founder, and why having friends and family to lean on is so important to business success. 

Maëlle Gavet on economic lessons from Russia

Your entrepreneurial background includes experience with a bunch of places that are hotspots right now, business and culture wise. You first came on my radar when you were CEO of an e-commerce business in Russia, the Amazon of Russia we used to call it. Do you have any insights on the business environment there or how the economic and political factors from the west and the war are impacting either way?

GAVET: Through Techstars, we are exposed to the conflict because we have quite a few investments with Ukrainian entrepreneurs. Ukraine has a very strong technological background and a lot of really strong engineers. And unfortunately, I’ve heard a lot of heartbreaking stories because there’s so much talent and so much innovation that has been put on hold because of this senseless war.

SAFIAN: A lot has changed in eight years from the time that you were in Moscow, right?

GAVET: Totally. This is where I learned to deal with my first massive economic crisis. I was the CEO of Ozon, I was there in 2014 when Russia annexed Crimea, and I remember very distinctively at the time, we went from 30 rubles to the dollar, to a hundred rubles to the dollar. And as an e- commerce, you would pay everything in dollars because a lot of the products that we would sell would be imported, and yet we would sell them to the Russian population in rubles. So dealing with a massive currency devaluation, obviously the sanctions that happened at the time that put a lot of pressure on any import activities, were a very, very good school for me in terms of learning to deal with major economic situations.

And I see a lot of parallels with the current situation, which is if not every day, every week, there is something happening. The Fed is increasing the rates, there is more layoff, there is the midterms election in the U.S. So you keep adding levels of complexity, and you keep changing the environment that, as an entrepreneur, you have to deal with on a daily basis.

SAFIAN: Yeah, I mean one of the lessons for entrepreneurs and business people is to focus on what you can control, and yet when the macro environment keeps moving around so much, more of your business becomes out of your control.

GAVET: Exactly. And I think that’s the biggest lesson for entrepreneurs, is you have to embrace the uncertainty. During an economic crisis, like the one we’re going through right now, the uncertainty becomes even bigger. What is going to differentiate a successful entrepreneur from a less successful entrepreneur is the ability to deal with a heightened level of uncertainty.

SAFIAN: When you left Russia, you then went and led Global Operations for Priceline, so you’ve been inside the travel and hospitality industry, which has had its own tumultuous period over the last two years. Then you worked in the real estate business, as the Chief Operating Officer at Compass, another sort of see-saw industry. Do you like volatility? Are you drawn to that?

GAVET: I’m a fixer. What I do for a living is fixing and scaling companies. Every single one of these businesses that you’ve just mentioned, that was that.

When I joined Compass, we had five offices, 300 employees, and I guess about 1,000 agents. When I left, we had 350 offices, probably even a little more than that, 15,000 agents, and well over 2,000 employees, and that was like a little over two years.

Scaling Techstars

SAFIAN: If Techstars has 3,300 companies today, I should expect that it will be like 70X that a few years from now? Is that same scale passion or plan part of what you see for Techstars?

GAVET: There are so many unstoppable and unbelievable founders everywhere, and to me, there’s an opportunity to make a lot more investment. We’ve been talking about making several thousands investments a year. This year we are going to make close to 600 investments, and I’m very, very much hoping that we’ll be doing a lot more than that in the next five to 10 years, yes.

SAFIAN: I had a guest on the show recently who was arguing that women leaders have a different style, a different approach, that make them better leaders for the environment that we’re in now than traditional male leadership. Do you see advantages in certain approaches?

GAVET: When I was running Ozon in Russia, a person asked me, “What does it feel like to be a female leader?” I looked at her and asked her, “What do you mean?” She said, “I assume that as a woman leading a company, it’s different.” I remember not knowing what to say, because I had never thought about it. I was like, “I don’t know. I don’t know. I have a company, I go to work every day, and I try to do the best I can.”

And I came to the conclusion that I didn’t know what it meant to be a female leader. I only knew what it meant to be a leader. Every man and every woman is different in the way they lead. There are definitely men and women who are much better during crisis time than others. I mean we talk regularly about wartime CEOs versus peace CEOs. These are usually two very different types of people. I’m just not sure that gender has much to do with that.

War-time leadership vs peace-time leadership

SAFIAN: What makes for a good war CEO versus a good peace CEO? I’m assuming you’re feeling we’re in a time of war now?

GAVET: We’re definitely in a wartime right now. A war CEO is someone who is very comfortable with uncertainty, back to what we were discussing earlier. Someone who is capable of switching very quickly between defensive and offensive all the time, because sometimes you need to preserve cash, and sometimes you need to invest. So war CEOs tend to be people who are more likely to take risks but are capable of making decisions, big decisions with partial information.

So that makes them very different from CEOs who are more there to maintain a status quo, making sure that all the right things are in place, foundations are very robust, business is humming. We need both, the world needs both types of CEO. What is important is that you match the profile of the CEO with what the business is facing at the moment.

SAFIAN: We talk about founders a lot on Masters of Scale, but we also talk about entrepreneurial thinking at scaled organizations, about accelerating growth in already established businesses. You’ve worked on both ends of that. Is one of them harder than the other, start-up versus accelerating a scaled business?

GAVET: I’ve done both, and I liked both. I have very consciously decided to not be an entrepreneur for the fourth time, because it is gruesome to go through the zero to one. I love working with the entrepreneurs with support, but it feels good to be advising them, and mentoring them, being in the trenches with them, but not being the one doing the zero to one.

SAFIAN: I remember having this conversation with Daniel Ek at Spotify, asking him about what the hardest stage has been. He said, “It’s always the next stage. The next stage is the hardest stage.” Which makes it sound like the early stage is easier, almost like that founders are overdramatizing how hard it is. But when I listen to you, it sure doesn’t sound like it. You sound like going back to that zero to one feels pretty painful to try to jump into.

GAVET: The blessing and the curse of an entrepreneur is that every day is different. Every day brings a new high, but also a new low very often. It can happen within an hour. You don’t have the infrastructure, the support, if you are suddenly a $100 billion public company.

Now some entrepreneurs will tell you: “Every day is new, and every day’s my day. I decide what I want to do with my day.” And other people will tell you that they prefer to have a slightly more structured environment with a lot more infrastructure and platform around them. I think it really depends on your personality and what you’re good at.

SAFIAN: And I guess being a founder is not necessarily for everyone, and for some people, being inside a bigger organization is just confining.

GAVET: The first thing I push back on with the young entrepreneurs is the idea that you are going to be successful almost overnight. One of the key questions I ask them: “Are you ready to spend the next 10 years of your life going through a rollercoaster of emotions, because you believe so much in that problem.” And if the entrepreneur says to me, “10 years? No, I think I can do it in five,” I usually tell them that they are probably in the wrong job, because it will take them about 10 years, and that’s if they’re successful. Less than 1% of start-ups which get funded at the pre-seed level will actually be successful. But then I also push back on people who say, “Oh, you cannot be innovative, you can’t be an entrepreneur if you work in a big company.” There are absolutely large companies where it is totally impossible because you have to follow the rules and all the approval processes. But there are absolutely companies where you can come up with a new idea, run it on the P&L, go to the board, and get the next stage of funding.

SAFIAN: Yeah, I sometimes think about businesses that they’re like families, and every family is different. Sure, we might apply some broad things that say, “Oh, they’re like this,” or, “They’re like that,” but when you get inside them, every one of these businesses is different, and you have to find one that fits you, your needs, and what your goals are.

GAVET: When you build a team, when you want to be part of a team, you need to think about, “Is that the right sport for me?” But also, “Do I fit well on this team? Do my skills complement everyone else on the team?” Good coaches, the same way good CEOs do, good coaches are actually very mindful about the team dynamic, and how it plays with each other.

I think about it in the exact same way when I mentor entrepreneurs, I’m like, “Look at the business you’re joining. First of all, is that a sport you want to play? Is that an industry you want to be in?” Then second, “Look at the team you’re joining. Is that the team you want to be part of? Because it’s going to be a lot of training, a lot of time spent together. Some victories, but also some failures. Are these the people that you want to spend time with? Are you going to help them be better? Are they going to help you be better?”

Advice for entrepreneurs right now

SAFIAN: Do you have advice for entrepreneurs who are in the trenches right now about how they keep themselves stable, focused, agile enough, but not distracted.

GAVET: I usually tell our entrepreneurs: “One, be very, very clear on your priorities, and you can’t have more than two or three. You need to be waking up every morning thinking, ‘This is what I’m trying to achieve,’ and anything that does not help you achieve this goal, you need to be ruthless and say no to them, learning to say no is really, really important. Then I tell them, no one succeeds alone ever. You need to have people who are ready to be with you in the trenches, whether it is, your team, your investors, your board.

And then the last thing: never, ever forget about their friends and family because business is important, and if you’re an entrepreneur, that can be an all-consuming endeavor. And the reality is: this is a marathon, this is not a sprint, and the best way to win that marathon is to be surrounded by people who are here to help you from a business perspective, but who are also here to support you just as a human being.

SAFIAN: Well, Maëlle, that was great, and thank you for joining the Master of Scale family here and helping keep us grounded and for spending your time with us. Really appreciate it.

GAVET: Thank you so much for having me.

Masters of Scale’s mission is to democratize entrepreneurship. Launched in 2017 as a weekly podcast featuring Reid Hoffman, we’re now two weekly podcasts — Masters of Scale with Reid Hoffman, and Masters of Scale: Rapid Response, hosted by Bob Safian — as well as an award-winning daily learning app, a best-selling book, virtual and live events, and more, serving a global community of founders, funders, and leaders looking to innovate at scale.
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