Sramana Mitra: I was talking to John Staenberg up in Seattle. He’s one of the most prolific investors in the North West. He’s invested in 300 companies. One of the drivers of how he chooses which entrepreneurs he wants to engage with is what he wants to learn about.
For example, he’s not very knowledgeable about Bitcoin and he is interested in learning about Bitcoin. He’s interested in entrepreneurs who are working on new opportunities in Bitcoin as a mechanism of understanding that trend.
Yes, investors do look to entrepreneurs to educate them and train them, which is what was driving my question
– are there specific areas where you are looking more to learn more about because of what you have seen so far. Let’s reverse the question. What trends are you seeing in your deal flow that can be extrapolated as trends?
Charlie O’Donnell: There are a lot of me-too deals around things that I’m not sure are full companies or not sure where the application of the technology is. Think about chat, voice, and bot. I look at voice-controlled interfaces as something that is going to be very important over time.
A little bit less clear is, is that going to be a feature of all of the platforms that we currently work on? Will Apple decide that Siri is going to open up for developers? Will I control everything from Dropbox to Salesforce using Siri or will there be other providers for that technology? I don’t think startups have a natural advantage in that area because some of these new technologies with AI are dependent on data for training.
Some of the larger platforms have a natural advantage. Google and Apple process more data and language. Facebook is on similar lines and can early on understand users a lot better than a startup can. For a lot of those investments, there may be some acquisitions of technologies that platforms will pick up to make their platforms better. It’s hard to see some of these as standalone use cases.
Sramana Mitra: There’s always that litmus test of ‘is it a feature or a company?’.
Charlie O’Donnell: I’m seeing a lot of those in the voice area. I would say the other area that I’m seeing a fair amount is in things related to security. I think people really underestimate how important security will be going forward for other technologies. People have asked me about autonomous vehicles. I really don’t think we’re going to get to autonomous vehicles unless we can secure those vehicles from outside hacking. You can’t have an army of cars exposed on the street.
I think those are really important considerations. Some of the advantages of those founders is they’re highly technical. I think it’s important to realize that every investor that you come upon is not going to be an expert in your particular vertical. It’s important to help somebody understand. Here’s how everyone’s been developing this problem previously. Here’s the way I’m going about it. Let me use an analogy of something that a non-scientific investor can understand why you’re going to create an advantage. That same ability is going to affect your ability to get PR, make sales and marketing higher.
Sramana Mitra: There are so many pitches that I see where it’s full of jargons and full of mumbo jumbo. You can’t understand what the hell they’re doing. It’s very hard to get customers to understand what they’re doing.