Society News Update, 1 Dec. 2016
- TechCrunch interviews Jodi Sherman Jahic (Class 5) on “Not Swinging for the Fences”
- In AgFunder News, Jenny Rooke (Class 11) synopsizes the KF Reunion Summit agricultural technology panel
- Victor Hwang (Class 12) and Phil Wickham (Charter) finish 7-video series on entrepreneurship in the Midwest
- International Finance Corporation Commits $30M to NXTP Labs (Ariel Arrieta [Class 18], Francisco Coronel [Class 20], Pablo Salazar Rojo [Class 15])
- Jason Green (Charter) on SaaS and what’s hot in tech: VentureBeat article and Diginomica interview
- Wale Ayeni (Class 18) makes International Business Times quotations list alongside history’s heavyweights
- Andrew Goldner’s (Class 21) advice to Knoxville, TN entrepreneurs: Get the word out
- Watch Khaldoon Tabaza (Class 15) on Bloomberg TV: Upcoming iMENA IPO
- Mamoon Hamid (Class 11) and Social Capital highlighted for pursuing “moonshots”
- This week’s blog selections: Ewa Grzechnik Treitz (Class 19) on investing in Poland • Jason Portnoy (Class 21) on the public vs. private investing landscape
- Fellows on the move: Mark Charest (Class 15) and Peter Liu (Class 21)
- Portfolio happenings: Jungle Ventures (Amit Anand) closes $100M fund • Invitalia Ventures announces new investments (Salvo Mizzi & Mario Scuderi) • Sozo Ventures on ServiceMax (Koichiro Nakamura, Phil Wickham, Martin Garcia, Yoshihiko Karita)
- Job opportunities: None at this time
- Errata: Correction for Kevin Lockett (Class 21) board seat.
TechCrunch Interviews Jodi Sherman Jahic (Class 5) on “Not Swinging for the Fences”
Jodi Sherman Jahic (Class 5) is the focus of a TechCrunch article, “A Longtime VC on the Virtues of Not Swinging for the Fences.” In this interview, Jodi shares the investment philosophy of her firm, Aligned Partners, which she founded with Susan Mason (Class 2). Jodi stresses that not all startups and founders are best served by raising large amounts of capital: “People don’t realize this, but there is zero correlation between how much money goes into a company and its exit value.” Aligned Partners’ investment thesis is solidly based on capital efficiency, and typically invests $2 to $5 million over the life of a company, always taking the lead and a board seat. The firm’s typical founders are serial entrepreneurs who didn’t come out of previous exits favorably. “They come to us saying, ‘I want to do it differently this time; I don’t want to overstuff my company with excess capital.’”
In AgFunder News, Jenny Rooke (Class 11) Synopsizes the KF Reunion Summit Agricultural Technology Panel
A November AgFunder News article co-written by Jenny Rooke (Class 11), “Framing the Ag Opportunity for Non-Ag Investors at the Kauffman Fellows Reunion,” summarized the highlights of the agricultural technology investment panel at last month’s Reunion Summit, which featured Jenny and Andras Forgacs (Class 14). The discussion probed the idea of convergence in the agtech industry, where intersections of technological innovation and agriculture are likely to present “abundant opportunities for disintermediation and disruption” for investors willing and able to get educated and begin working in this challenging and potentially rewarding sector. Read the full article.
Victor Hwang (Class 12) and Phil (Charter) Finish 7-Video Series on Entrepreneurship in the Midwest
When we wrote the last bulletin, Victor Hwang (Class 12) and Phil Wickham (Charter Class) were in the midst of their travels to five Midwestern cities and towns to see how entrepreneurship has taken hold in the US heartland. They interviewed founders and investors to get a sense of what makes this region particularly fertile ground for business creation, creating a 7-video series made in honor of Global Entrepreneurship Week. Victor and Phil present the case that entrepreneurship from the bottom up can be a path to economic renewal; Victor says, “The bigger narrative is that the tools of innovation are becoming more and more democratized, and so these ecosystems in the last five years have really taken hold, and that the support structures have taken hold, and the culture is changing where people that are really interested in trying to do innovative things finally have the access to do it.” See the entire series.
Victor was interviewed about the journey in the Silicon Prairie News. When asked whether their trip confirmed or changed his views about what’s happening “on the ground,” Victor said, “The most simple observation is that this resurgence of entrepreneurship in the heartland is true. It is happening.” Victor noted that one common theme in all the places they visited was the difficulty in accessing capital. [See the KF website for FAQs on the new Kauffman Foundation scholarships for the Kauffman Fellows Program for Midwest investors, which will increase this access in the coming years.]
International Finance Corporation Commits $30M to NXTP Labs
The International FInance Corporation, part of the World Bank, has committed $30M to NXTP Labs and NXTP Fund 2. NXTP, with Fellows Ariel Arrieta (Class 18), Francisco Coronel (Class 20), and Pablo Salazar Rojo (Class 15), is an early-stage tech investor and accelerator with operations in Argentina, Chile, Colombia, Mexico, and Uruguay. IFC is committing $3M to NXTP Labs, the organization’s accelerator, which seeks to support 300 companies in the LatAm region during the term of the agreement; $17M as an anchor investor in the firm’s Fund 2; and up to $10M for co-investment with NXTP. Congratulations, Ariel, Francisco, and Pablo!
Jason Green (Charter) on SaaS and What’s Hot in Tech: VentureBeat Article and Diginomica Interview
Jason Green (Charter Class) was interviewed on Diginomica about what he views as today’s big growth sectors (read the article to learn his 4 top picks). Jason observes that “with any new technology area it’s always difficult to separate the successful use cases from the purely experimental.” He goes on to say, “It’s easy to conceive that [the hardware-enabled technologies sector] will generate significant new business opportunities—but hugely difficult to identify where precisely those opportunities will prove most lucrative. But of course that’s the whole point of the venture capital industry—to identify where the next success stories will spring up, and then to seek out the ones with the best chance of success.”
Jason also wrote an article in VentureBeat this week, “The Cloud Hit Escape Velocity in 2016, Powering a SaaS Buy-Up.” Jason notes that GE’s acquisition last week of ServiceMax (in which he was an early investor, as we reported in the last bulletin) marked the first billion-dollar acquisition of a SaaS firm by a company outside the traditional software sector. He predicts that this trend will continue, and that the current “M&A craze” is more than a phase—it points to the ever-increasing importance of the cloud. Read the full article to get Jason’s view of the current landscape and what opportunities lie ahead.
Wale Ayeni (Class 18) Makes IBT Quotations List Alongside History’s Heavyweights
Wale Ayeni (Class 18) made the International Business Times list of 29 quotes about gratitude for Thanksgiving, rubbing elbows with the likes of Shakespeare, Thoreau, JFK, and the Dalai Lama. Wale’s quote was #13 on their list:
Be thankful for what you have. Your life, no matter how bad you think it is, it’s someone else’s fairy tale.
Andrew Goldner’s (Class 21) Advice to Knoxville, TN Entrepreneurs: Get the Word Out
Andrew Goldner (Class 21) and his GrowthX partner Brad Holliday spoke at Knoxville, Tennessee’s Innovate865 bi-monthly happy hour, a social event fostering networking and education among the region’s entrepreneurs and investors. In their talk, Andrew and Brad stressed the importance of getting the word out about Knoxville as a good place to start a business. “Knoxville needs a story”: its proximity to Oak Ridge National Laboratory and the University of Tennessee, combined with its cost of living, are a great foundation for an entrepreneurial ecosystem. In terms of retaining local talent, Andrew believes that entrepreneurs should be close to their customers, not their financiers, but that requires the availability of venture capital for firms outside the traditional investing hubs. Read the Knoxville News Sentinel article.
Watch Khaldoon Tabaza (Class 15) on Bloomberg TV: Upcoming iMENA IPO
Bloomberg reported yesterday that iMENA, led and founded by Khaldoon Tabaza (Class 15), is planning a $100M IPO in late 2017 or early 2018. The firm plans a primary IPO in a location such as London or New York, followed by a possible second listing on an exchange in the Middle East. iMENA operates online marketplaces in the MENA (Middle East and North Africa) region, such as taxi and restaurant booking services and person-to-person car sales. Started in 2013, iMENA targets large existing industries that are currently offline and brings them into the digital world; they have focused on the online marketplace and classified sectors because, as locally based markets, they place a high barrier to entry for competitors. Khaldoon wrote a Kauffman Fellows Report article last year, in which he discusses the landscape for the Internet sector in the MENA region. The Bloomberg article contains the text story as well as a TV interview with Khaldoon from Bloomberg Markets: Middle East.
Mamoon Hamid (Class 11) and Social Capital Highlighted for Pursuing “Moonshots”
Mamoon Hamid (Class 11, KF board member) and his firm, Social Capital, were one of three highlights of a VentureBeat article, “Venture Capitalists and the Search for Moonshots.” While Social Capital has its traditional investing side, it also has partners looking at much longer-term bets. When evaluating projects, those partners still ask the same questions used within the traditional investing track, with a few added: “Does the company have the ability to touch the lives of a billion people?” “Does it have the potential of generating a $100 billion market cap?” “Will it fulfill a human need?” Mamoon says, “Everyone wants to work on something that makes a difference. … What we seek out is authenticity.” Read the full article.
This week’s blog selections:
- Ewa Grzechnik Treitz (Class 19) offers an introduction to the Polish VC landscape in two blog posts. In “What’s Hot in Poland?”, Ewa employs Gil Dibner’s (Class 13) analytical categories to the portfolios of Poland’s nine major VC firms, breaking down companies by geographic region, sector, customer, and business model to give readers a comprehensive overview of the Polish startup ecosystem. Her follow-up post, “How Does the Polish Startup Ecosystem Compare to the West?”, discusses Polish startups within the context of Gil’s 2016 data for startups in Western Europe and Israel in terms of their sectors and models.
- Jason Portnoy (Class 21) was interviewed on the Altos Investments blog in a post entitled, “The Times They Are A-Changin’.” The in-depth discussion centers on a comparison of public and private company investing, appetites for risk-taking, the returns available in each sector, and IPOs, as well as how the retail investor can make an allocation to the private equity markets.
Fellows on the Move
- Mark Charest (Class 15) has moved from Tekla Capital Management and is now Portfolio Manager at Phenomic Capital, a life sciences and investment advisory firm.
- Peter Liu (Class 21) is moving from Chicago to Los Angeles to assist in the Pritzger Group Venture Capital’s efforts to expand its Los Angeles presence. Pritzger has already invested in over 20 LA-based companies, and will continue making early-stage investments of $3M to $8M. [Press release]
- Congratulations to Jungle Ventures and Amit Anand (Class 18), who announced yesterday the closing of their $100M fund for startups in the Southeast Asia region. They are shifting their focus in this second fund from seed to Series A and B, with investments of ~$3M. According to Amit, “The ecosystem has matured. In 2012 there were maybe 300 deals a year, now it’s anything between 2,000-3,000, that’s a big jump in just a few years. We always felt startups are under-capitalized here given the challenges they face on operations.” Read the TechCrunch article.
- Invitalia Ventures announced via Twitter that its board has approved 5 new investments. Invitalia Fellows Salvo Mizzi (Class 16) and Mario Scuderi (Class 21) described their new investments as “playing in cleantech energy, e-health & data, robotics, biotech, [and] VR.”
- In our announcement last week of GE’s purchase of ServiceMax for close to $1B, we neglected to mention that Sozo Ventures (Koichiro Nakamura [Class 12], Phil Wickham [Charter Class], Martin Garcia [Class 19] and Yoshihiko Karita [Class 21]) also participated in Series E and F of ServiceMax’s growth. Congratulations to all!
Job opportunities sent in by Kauffman Fellows Society members are shown in this section, and are listed for 4 weeks. If you are a Fellow or Mentor and would like to post your job in next week’s newsletter, please email us.
Last week we reported that Kevin Lockett (Class 21) joined the board of Intrust Bank. Our email headline, however, incorrectly listed the firm as “Intertrust Bank” instead of “Intrust Bank.” Society News regrets the error.