On this episode of Women @ RopesTalk hosted by health care partner Christine Moundas, capital solutions and private credit partner Alyson Gal interviews Jenny Walsh, a managing director who co-leads the consumer investing team at Sixth Street, a San Francisco-based global investment firm with over $75 billion in assets under management. Jenny talks about her experience building Sixth Street's consumer investing business, and highlights the collaborative and flexible nature of Sixth Street's investment approach. The firm's diverse range of investments in the consumer space—from traditional brick-and-mortar stores to technology-enabled businesses—as well as in sports teams like the San Antonio Spurs and Bay FC, speak to how Sixth Street marries a solutions-oriented approach with bigger picture themes. Jenny discusses the value of mentorship and networking, and what she and Sixth Street are doing to support the next generation of women investors.
Transcript:
Christine Moundas: Welcome, and thank you for joining us on our latest installment of Women @ RopesTalk, a podcast series brought to you by the Women's Forum at Ropes & Gray. I am Christine Moundas, a health care partner at Ropes & Gray based in New York and I am co-head of the firm's digital health initiative. On this episode, I am joined by my colleague, Alyson Gal, who is based in Boston. Hi Alyson. To start, could you please introduce yourself and provide an overview of your practice?
Alyson Gal: Sure thing, Christine. I am in our capital solutions and private credit group. I started my career as a finance and bankruptcy lawyer. Right now, I typically work with private funds that are doing creative investments that are bespoke or require some special sauce.
Christine Moundas: Who is your special guest that you will be interviewing on this episode?
Alyson Gal: I am really thrilled to be interviewing Jenny Walsh, who is an investment professional at Sixth Street Partners. Sixth Street is $75 billion investment firm with a really broad mandate—they do tons of interesting things. I have worked with them for many years.
Christine Moundas: How did you meet and start working together?
Alyson Gal: Jenny is one of the investment professionals on the deals there. We've been working together on financing transactions for quite some time.
Christine Moundas: What would you say is the most notable thing about Jenny's career?
Alyson Gal: What I have been struck by in chatting with Jenny in the past about her career, and the reason I thought her experience would be great to share in this forum, is how she provides a window into how creative and collaborative it can be to be an investment professional at a large investment fund, particularly where the culture is one that encourages people to grow and take on additional challenges and responsibilities.
Christine Moundas: That is excellent. With that, I will turn it over to you and Jenny.
Alyson Gal: Hi, Jenny. Thanks very much for being with us today. Can you introduce yourself to our listeners?
Jenny Walsh: Sure, happy to—thanks for having me. My name is Jenny Walsh, and I co-lead the consumer investing team at Sixth Street, which is a large alternative investment firm based in San Francisco.
My responsibilities here range from leading and sourcing new transactions to supporting our existing management teams in investments and continuing to build out our consumer team.
I am also really involved in a handful of our sports investments. I am very proud to be a board member at Bay FC, which is the national women's soccer team we are bringing to the Bay Area in 2024, and I am also involved in our investment in the San Antonio Spurs.
On a personal level, I live in San Francisco with my husband and our five-year-old labradoodle, who rules our house.
Alyson Gal: Great—thanks, Jenny. Could you tell us a little bit about how long you have been at Sixth Street and the various roles that you have had at the firm?
Jenny Walsh: I joined Sixth Street in 2016 and have been here ever since. I started as an associate and have been with the team through today. I am now a managing director on the team. Through that time, Sixth Street has grown quite rapidly, which has been fun to be a part of. We have also built a lot of different teams over that time.
About three years ago, the partner group approached me about building out our consumer team. We have been doing some very interesting investments within the consumer space opportunistically over time and realized that to get deeper and do more of those interesting deals, we needed to build out a full team. So, I spent about a year of my time doing that, and then, on the back of that, we decided to invest in resources to build a full team. We hired someone externally—named Kayvan Heravi, who is awesome—to be my partner in leading the team, and we now have eight people in San Francisco focused on consumer.
Alyson Gal: That is exciting to be part of a new platform. For those who don't know, like me, what do you mean when you talk about investments in consumer? What kind of investments are you talking about? What would a company be doing to qualify for that kind of title?
Jenny Walsh: It is a huge market and a really large landscape. I think it can wear a lot of definitions at different firms, but for us, it is any business that interacts with the consumer or whose end market is a consumer. So, that can take its shapes in many different ways. It can be a gym that you walk into every day. It can be a restaurant that you eat at. It can be a med spa where you get your Botox. Or it can be a more technology-enabled business like ClassPass, for example, where you are using the aggregated platform to find a fitness class, and then attend that fitness class. It is really everything from your traditional brick-and-mortar stores all the way through technology-enabled businesses that help enable a consumer transaction.
Alyson Gal: What led the firm and you to think that forming a consumer-focused business group would make sense? Is there a commonality to investments in the consumer space that makes that a logical platform?
Jenny Walsh: It is a good question, Alyson. We have been making consumer investments opportunistically since the beginning of Sixth Street, in companies like Spotify and Chobani. As we thought about where we wanted to build incremental industry teams at Sixth Street, consumer was an obvious area. It's a massive category of GDP, and we found, as we dug deeper in the space, that many of the businesses had characteristics we love at Sixth Street regardless of the industry, and that is strong, underwrite unit economics and predictable, long-duration cash flows. These attributes gave us conviction to go out and build a bigger team around the sector.
Alyson Gal: It is interesting, because the range of deals that you are talking about, it can be things that consumers buy or places where consumers go to enjoy themselves, recreate, and to exercise and get fit. It sounds like the commonality is that you are figuring out what appeals to people and what they need. Does that sound correct?
Jenny Walsh: That does sound correct. We tend to try to stay on top of consumer trends, but we try not to call those trends. I think we never try to focus on the fad-oriented businesses, but those that deliver an excellent value proposition to their customer and are giving them a product that they want and need. I think we also try to avoid areas of the sector that can be disintermediated by very big, well-capitalized players like an Amazon or a Walmart. So, we have tended to look at more services-oriented businesses on the brick-and-mortar side, or technology-oriented businesses on the tech-enabled side.
Alyson Gal: That is a challenge to try to anticipate what is going to be disrupted by all of the new innovations in the market. Are there any names that you are allowed to say that our listeners might find familiar?
Jenny Walsh: We made a large investment into Milan Laser, which is the largest laser hair removal company in the United States, run by an excellent and talented founder, and a really amazing broader team. We have also invested in a business called Far West, which is the largest Wingstop franchisee within the Wingstop system.
Alyson Gal: What about sports? You identified that as another special area of focus for you.
Jenny Walsh: Yes, sports is a very interesting category that has seen a massive inflow of institutional capital over the last few years. My involvement on the sports side has been a fun collaboration with our sports, media and entertainment team. One of the best aspects of working at Sixth Street is that we operate as one team. There is no "my team" or "your team"—we all operate together. We believe to make a great sports investment, you need a very good understanding of the media landscape, but you also need an understanding of consumer preferences, and so, operating under our one-team culture, our two teams have collaborated on some of the sports investments, which has been very fun.
Alyson Gal: I have seen firsthand in working with Sixth Street that people will be folded into the team and then will go back out of the team as their usefulness comes in and out of the transaction. You might have some folks helping with diligence, and then they might fade back while the deal is negotiated. It definitely is a seamless-looking process from the outside.
What is your day like? With your responsibilities, how do opportunities come to you and how do you think about evaluating them and structuring them? Give our listeners a sense of what it actually means to do your job.
Jenny Walsh: Every day looks a little bit different, which doesn't directly answer your question, but it depends on what is going on in the team, what deals we have in our pipeline, and if any of them are close to becoming a transaction that we are making a final investment in. Most of my day is spent doing outward outreach, whether that is being at conferences, or speaking with bankers, or flying to meet management teams, as well as supporting and helping to underwrite new transactions.
Alyson Gal: Suppose you have a transaction that looks interesting. Do you only do debt? Do you only do equity? How do you think about what kind of investment is the right one for a particular opportunity?
Jenny Walsh: I think one of the very unique things about Sixth Street is we have an incredibly flexible mandate. We have set our funds up to really go find the best risk-adjusted return within the capital structure, and that can truly be anything from first-lien debt to second-lien debt to convertible debt, preferred equity, common equity, and everything in between. I really think that is a secret weapon of Sixth Street's, because it allows me and the consumer team to just go find great companies and say, "We would love to invest in your business. What do you actually need? How can we be a solution provider for you? We don't have one specific product that we need to sell to you. We just want to put the best investment possible into your business to help you succeed." We have a lot of different ways that we can invest, but our job is to go find great companies and be a solution provider for them.
Alyson Gal: It always floors me how diverse your knowledge base and expertise has to be to do a job like yours. Backing up, how did you get to where you are? What was your education? How did you decide to go into this kind of a profession?
Jenny Walsh: I went to Notre Dame for college. I didn't really know what I wanted to do. I was good at math and science, so I started out as an engineer, and it very quickly became clear to me that that was not my passion. I didn't really know what to do, so then I transferred to pre-med. I was very lucky in that I interned my freshman summer at a fast-growing startup in my hometown in Fort Lauderdale, so I am very grateful to that person who gave me that job—they were recently at my wedding. What they were doing was raising money, and so, they allowed me to sit in on some of the meetings that they had very prominent venture capital firms coming through presenting to them. I remember leaving those meetings saying, "Oh my goodness, this is such a cool job. You get to meet all these companies, evaluate their business, and help them succeed." The rest is a bit of history from there. I went back to Notre Dame and changed my major. I ultimately had the opportunity to intern at the firm that invested in that business, and then from there did the investment banking route at Morgan Stanley and joined Sixth Street following that.
Alyson Gal: It is exciting to hear about career paths like yours. You didn't know what you wanted to do. You stayed alert though and took an opportunity. You didn't know whether it was going to be something that you were really interested in, and then something comes along within that opportunity that sparks your passion. That is such a cool story.
Can you talk a little bit about how you got the opportunities that you had? Were there significant decision points that you had, or mentorship or other relationships, or resources that influenced you along the way?
Jenny Walsh: I have always had great mentors who have given me great advice along the way. I would be nowhere without mentors, and I encourage everybody who is listening to go and develop those relationships.
I think, honestly, the first one started with my dad, who was an excellent mentor and is still one to me today. When I was thinking about post-Morgan Stanley, there are all these different investment firm opportunities: How do I figure out which one I want? I think he helped me lay out my priorities, which were a young and hungry team, a growing business, and a place where I would get a lot of different deal repetitions across a lot of different types of investments. That is what led me to taking the job at Sixth Street. I saw this team of young partners growing a business rapidly and doing really interesting transactions.
Within Sixth Street, I have been very blessed with some really amazing mentors who have pushed me to take on new opportunities, including to be a part of building a consumer team. I was encouraged to take the opportunity and supported along the way as we built our team and are continuing to build our brand within the space.
Alyson Gal: As you develop and increase in responsibility, and frankly, what is expected of you, are there things that you do to keep yourself well-informed about what is going on in your industry, or educated in a way that enables you to spot, "This is an opportunity, but now I am worried that there is an opportunity for another market player to disrupt." Just how do you get smart on all that stuff?
Jenny Walsh: I think there are two things. The first is just being fully engaged within your industry, so that is flying to conferences, spending time with management teams, and reading all the big publication trades within the industry. I would say interacting with people who are operating businesses day-to-day in that industry are the conversations that I find most useful. I never pretend to know more than them, because I know that I don't, and so I always try and be a student of their business when I do spend time with them.
I would say the second piece of it outside of the industry focus is just the pattern recognition of a Sixth Street deal. One of the things I love about working here, particularly when I was younger, is that all of our committees are open—whether it is an infrastructure, consumer, or tech deal, everyone is able to show up and listen to the discussion. It provided me this incredible opportunity to see the patterns of what Sixth Street likes about a business, regardless of what industry it is in. I found that the overlap between all these businesses was actually pretty dramatic. Although I operate the consumer sector today, there are things that Sixth Street likes in all deals that I am trying to find.
Alyson Gal: Being in those committee meetings, I am sure you got to hear from senior people with a lot of experience. That is a great learning opportunity in itself.
Jenny Walsh: Definitely. Even as the firm has grown, we still go around the room, and everyone gives their perspectives on the opportunity. I believe listening to those perspectives of our founding partner and the deal teams week in and week out were, and still are, truly invaluable to me.
Alyson Gal: Do you think that you have the personality type that is common for this job? Are you an extrovert, a gregarious person? Is that what it takes to be a successful investment professional? Do you have to be able to go to a cocktail party and immediately be able to strike up a conversation with anyone you meet?
Jenny Walsh: That is a great question, Alyson, because it has been a skill I have developed over time. I am generally a talkative person, but I do still, I think like most people, get overwhelmed by a cocktail reception full of people that I don't know, and so, it is a skill that you have to develop. One of my favorite mentors, her name is Maggie Wilderotter, she is really talented, always says, "Networking is work." And so, I had to think about it as "this is a skill that I need to develop." It gets easier and easier, and as you get to know more and more people, you start to build relationships with them, and then people are familiar. You go to these events, and you know five or six people, and then you know 10 or 15 people. I think there is this common misconception sometimes that people are just super extroverts, and everything is so easy for them when they go to these big industry events, but I think there are very few people for whom that is actually their core skill set. You need to think about it as, "This is my job, and I am going to improve on this every single day." Or at least that is how I think about it.
Alyson Gal: Do you think that you are by nature a cautious person or a person who likes to take risks? Have you cultivated a particular personality type along that spectrum in order to succeed at what you do?
Jenny Walsh: Doing this job you need to have the right balance of both skepticism and doing your work, and doing your diligence and making sure you are understanding what truly makes the business tick, and understanding all the key risks that are inherent in any investment. If you can't find risk in an investment, you are probably not looking hard enough. Also, balancing that with knowing that there will be risks in every investment, and how you can get your head around those and push yourself to be creative about managing those risks, so that you can ultimately make an investment. You can typically find a reason not to do most investments, but this job is about balancing finding those risks, evaluating them, and then figuring out ways to mitigate them so that you can move forward with an investment.
Alyson Gal: I think that from the outside, at least, your firm, Sixth Street, has such a collaborative structure, where everyone is going to have input into the investment and the decision is made collectively, more or less. I think that provides a really safe space for a risk-taking business. Do you agree? Is that a fair assessment?
Jenny Walsh: Yes, it is definitely a fair assessment. Part of what I love about our culture is I think everyone feels an ownership around every single investment that they make—not just the ones that they are leading or a part of. I will never forget my first year here. We were going around the table with the investment committee, and I gave a little bit of a wishy-washy answer on whether I wanted to do it. Alan, our CEO, looked at me and said, "Would you put your parents' retirement money in this investment?" It is just a moment I have never forgotten, because that is how everybody at Sixth Street should think about every deal that we do. We all wear each other's risk, we all make decisions together, and we should all be thinking about putting money to work in things that we would put our own money into.
Alyson Gal: In the process of letting your own career unfold, and looking for opportunities and trying to sense what you might be interested in and good at, did you get any great advice along the way that sticks in your head?
Jenny Walsh: I have had a lot of great mentors and a lot of great advisors along the way. One of those people happens to be our CEO, Alan Waxman, who has been a huge advocate of my career through my time at Sixth Street. One little phrase that he gave me back when I was an associate—and he could tell I was maybe a little bit more timid to speak up in investment committee, or I had something that I wanted to say but it was a really challenging skill for me to develop to speak up in a room full of people that I thought and knew were much smarter than me—is he taught me this little saying, which was, "Tap the wire." What that means is if you have got something to say or you think there is an opportunity you should take, walk up to the live electric fence or wire, get close to it, and take the risk. You might tap it and you might get a little electrocuted, but that is okay—you will keep moving and you will learn from it. But don't be afraid to tap the wire, get close to it, and take the risk.
Alyson Gal: I have these mental images of old cartoons where somebody gets electrified! You would have an interesting frizzed-out hairdo.
Jenny, you have talked about how important the influence others have had on your career, starting with your dad. What about your own experiences with mentoring others? Do you mentor those around you, and how do you do that? Do you have any advice for someone looking for a mentor or looking to be a good mentee and to make the most of mentoring relationships?
Jenny Walsh: I am aware that I have been given a lot of great mentorships, and so, I am trying to give that back to the next generation of leaders at Sixth Street. I have seen how important that has been in my life, and so, continuing to develop our team, making sure they feel like they have opportunities, they have a place to come and ask questions and get advice is important to me. It is something I am very focused on within the consumer team and within the broader Sixth Street team—particularly within our female investor population. This is something I am very passionate about growing and developing, because female mentors were really powerful for me.
In terms of advice for people who want to be mentees, I would say the biggest piece of advice is when you are going to a mentor for questions, or when you are having a session with them, always show up prepared. I always had a long list of questions that I had for them that were business-oriented and tactical, and I always tried to use every minute that I had with them as something that was going to help me solve problems or obstacles that I had. Then, I would typically follow up with them, saying, "You gave me this piece of advice. Here is how it went. I tapped the wire too hard." Or, "It went great. Thanks for the advice." Or, "Is there any other advice you have for me, given it didn't go so well?"
Alyson Gal: That feedback loop seems to provide a really great way to get people invested in whatever your situation is. Are there structures or organizational initiatives within Sixth Street that provide support to other women in the industry?
Jenny Walsh: Yes. At Sixth Street, one of the very exciting things over my time here is we have developed out our support system for the female population within our business. We did our first senior women's summit, which was to get all the different senior leaders from the firm, really around the world, together, which was very fun and exciting. We have a great women's network. We also have what we call our Women's Investing Cohort, which is where all the female investors, two or three times a year, get together and build a community, but talk about very functional topics within our business. We bring in experts from other areas of the business to help us develop those tactical skills to get ahead and have a differentiated learning experience to help boost our careers within the firm and externally.
Alyson Gal: Certainly, just giving opportunities to women professionals is important in itself, but can you talk a little bit about do you see the benefit in terms of either decision making or otherwise of having diverse teams?
Jenny Walsh: Particularly in consumer, women are traditionally spending much more of the wallet than men. In a lot of the businesses that we look at, women are the core consumer, so we need to have a woman's voice in our investment committee and our deal teams doing diligence to make sure that we are hearing from the core consumer. This is a funny example, but in Milan Laser, which is a laser hair removal business, 90% of their customers are women, so it is important that in the decision-making process, we have women as a part of that.
Alyson Gal: That is a great observation. Jenny, are there any other opportunities within the community that you have had to connect with other women in the area?
Jenny Walsh: Funny enough, Alyson, not to give Ropes a shameless plug, but this is the honest truth—you guys host the best women's events in San Francisco. Chau leads them—she does a great job. Liz is also a really big part of it. It is just this great gathering of women typically over a very fun dinner. It has been a place where I have met some really talented women that I still keep in touch with today.
Alyson Gal: Always feel free, Jenny, to give us shameless plugs! That is Chau Le and Liz Gallucci that you mentioned—partners in our San Francisco office. It is really great to hear that that event has been so helpful and enjoyable. Thanks so much for your time, Jenny. This has been a great conversation. I am always inspired to hear about successes of folks like you.
Jenny Walsh: Thanks, Alyson. I really appreciate you having me on, and your support for my career over the last several years.
Christine Moundas: Alyson and Jenny, thank you both so much for that insightful discussion. And as always, thanks to our listeners. For more information about Ropes & Gray and our Women's Forum, please visit ropesgray.com/women. You can also subscribe to this series wherever you typically listen to podcasts, including on Apple and Spotify. Thanks again for listening.
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