Patricia Cloherty, venture capitalist pioneer, dies at 80

Patricia M. Cloherty, the daughter of a lumberjack who was one of the first women to thrive in high-risk, high-return venture capital and was a key financial backer of fledgling businesses of post-communist Russia, died Sept. 23 at her home in Miami. She was 80 years old.

The death was confirmed by his sister, Judith Cloherty Mendel.

Ms. Cloherty was 27, had two master’s degrees from Columbia University (none in finance) and had spent two years in the Peace Corps teaching Brazilian farm children how to sterilize pigs when, at an event linked to the United Nations in 1969, she met Alan Patricof, an investor who was opening a venture capital firm.

Impressed by her intelligence, he offers her a job as a research analyst despite her lack of experience in the field.

“He said, ‘Would I like to learn the trade from scratch?’ Ms. Cloherty recalled during a 2011 interview for a National Venture Capital Association oral history project. “I had no idea what the business was.”

Mr. Patricof thought she would excel at answering the fundamental question of venture capital: what business ideas were worth betting on?

“She said she had no background in finance,” he recalled in a phone interview. “I told her she could learn that.”

He was right. Within two years, Ms. Cloherty was a partner at Patricof & Co. Ventures, which held early positions at Apple, Office Depot and the company later known as AOL. The company grew into a multi-billion dollar international business, and she eventually became its co-chairman and president.

Ms. Cloherty was particularly drawn to investing in biotech companies and others in the high-tech sector, including Agouron Pharmaceuticals, a producer of protease inhibitors used to treat HIV; Tessera Technologies, which made protective packaging for computer chips; and PPL Therapeutics, the Scottish firm that gave the world Dolly the cloned sheep.

In a 2013 interview with a Columbia University Teachers College publication, she said that while she wasn’t in “the industry that saves the world,” she was keen on supporting people who were trying to do good things. “I’ve been a Girl Scout all my life, which taught me that you try to leave the campsite better than you found it,” she said.

Ms. Cloherty left Patricof, later renamed Apax Partners, for about ten years, first to become deputy administrator of the Small Business Administration in Washington from 1977 to 1978, then to run an investment company with Daniel Tessler, whom she married in 1977.

The Russian chapter of Ms. Cloherty’s career began in 1995, when President Bill Clinton appointed her to the board of directors of the American Investment Fund in Russia, whose mission was to invest American capital in the movement of Russia towards a market economy. She became the fund’s chairman in 1998. Two years later, she moved to Russia for what was to be a six-month stay. It lasted 12 years.

Ms Cloherty became managing director of the investment fund’s managing partner, Delta Private Equity Partners, overseeing the financing of more than 50 Russian companies – including the country’s first mortgage bank, the first credit card issuing bank and the first bottled water company – then selling most of them for what she described as substantial returns.

Mr. Patricof attributed his success largely to what he called his “Pied Piper quality”.

“She had a unique ability to lead people,” he said.

Donna E. Shalala, a former health and human services secretary, congresswoman and president of the University of Miami who had known Ms. Cloherty since the 1970s, said in an interview that her friend “was the most curious person that I have ever met”.

Patricia Mary Cloherty was born on July 2, 1942 in San Francisco, the second of four children born to John and Doris (Dawson) Cloherty. Her father had immigrated to the United States from Galway, Ireland, as a 13-year-old orphan. His mother was from Victoria, British Columbia.

His parents worked for the Southern Pacific Railroad during World War II and ran a dry-cleaning shop in town after the war ended.

In the Venture Capital Association interview, Ms. Cloherty recalled how she first learned to make a bet.

His maternal grandmother, she says, while caring for young Pat and his siblings, would take them with “her bottle of gin” to local racetracks to bet on races.

“Notice, we were only 3, 4 and 5 so we hit the trail early,” Ms Cloherty explained. “It’s my education.”

When she was about 5, she said, the family moved to Pollock Pines, Calif., a hamlet half an hour south of Lake Tahoe in the Sierra Nevadas. His father worked there as a lumberjack and in construction; his mother was a real estate agent and librarian. The couple also held a soda fountain.

According to Ms. Cloherty, the family was poor and life in the mountains could be harsh. But there was plenty to do, she said. An avid reader and self-proclaimed “superb” student, she was also a good athlete and handyman who used instructions from Shredded Wheat wrappers to make a waterproof match holder, reflector oven and tent out of a military parachute. excess.

When she was 12, she recalls, she was on a ski trip with two friends, carrying homemade camping gear, when an avalanche stranded the girls for two days. She was left with lingering effects of frostbite for over 50 years.

After graduating from high school, Ms. Cloherty attended San Francisco College for Women (a Catholic school now part of the Jesuit University of San Francisco) on a scholarship, earning a bachelor’s degree in Spanish literature and Classical Greek in 1963.

The Peace Corps was forming around the time she was due to graduate, and Ms. Cloherty decided to join.

But she quickly changed her mind after meeting Baroness Maria von Trapp, the Trapp Family Singers matriarch made famous in ‘The Sound of Music’. Mrs. von Trapp, who was visiting San Francisco, urged her not to go.

“She said, ‘You can’t do that,'” Ms Cloherty recalled. “‘You will become a pawn of American foreign policy and you will ruin your life.'”

After working briefly at von Trapp’s Vermont farm as an assistant to the Baroness, Mrs. Cloherty joined the corps anyway. She was placed in a remote region of Brazil, where she trained farming families in animal husbandry and other agricultural skills.

A Ford Foundation Fellowship funded his master’s degrees from Columbia in Education and International Affairs.

In addition to her sister, Ms. Cloherty is survived by one brother, Michael. Her marriage to Mr. Tessler ended in divorce.

Before moving to Florida in 2017, Ms. Cloherty split her time between an apartment in Manhattan and a house in Garrison, NY, in the Hudson Valley (and, for several years, an apartment in Moscow). After retiring in 2012, she continued to advise colleagues informally until a few months ago. His hobbies included hiking, often with friends like Ms. Shalala, near her garrison home and in more distant places like the Himalayas and Mexico.

“Mountains put into perspective the artifice of everyday modern life,” Ms. Cloherty told The New York Times Magazine in 1988. “Climbing invigorates me.”

When asked in the Teachers College interview about her business philosophy, she offered a maxim that she said also applied to life in general.

“If you see something you like, never hesitate because of the risk,” she said. “Never put the money before the accomplishment of the goal.”

Alain Delaquérière and Sheelagh McNeill contributed research.