Sramana Mitra: Let’s talk a little bit about how you operate. If you put in $25,000 to $50,000, do you operate with a syndicate that would bring in the rest? Do you lead a syndicate? Do you follow into a syndicate?
Waikit Lau: It depends on what the entrepreneur wants and needs. They may say, “I’ve got no connections. I’m new to this, but I’ve got something really interesting.” I essentially help them either put together a syndicate where I run the syndicate or I introduce them to potential lead investors that I think would gel with them personality-wise. In a lot of cases, entrepreneurs already have their syndicates set or they have a lead investor. In which case, I’m just a follower. I’ll just write a check for myself.
In the cases where I have led or co-led, it runs the gamut. I have an AngelList syndicate where I’ve done deals where I run a few hundred thousand
dollars. I have also done it outside of AngelList syndicate. Some entrepreneurs say, “I don’t really want to do AngelList. I’d rather do it outside.”
Sramana Mitra: What we try to do here is work on a lot of case studies. We do pitches where we strategize on a couple of companies and people get to listen to how to think about different problems. In all the 50 companies that you’ve invested in, could you take us through a couple of case studies and explain what was the idea that came to you, what stage it came to you at, and what was it that really struck you that this is going to be powerful that got you to invest?
Waikit Lau: I can give you a couple of examples on various stages in no particular order. An interesting case study is a company out of MIT. It has four MIT alumni. They were students a few years ago. They got into YCombinator. Their company is called Multiply Labs. They have figured out a way, using off-the-shelf 3D printers, to print pills using FDA-approved polymer.
They can print a pill with different pockets in the pill so you can actually have different ingredients in the pill and have different wall thickness so it actually has different release schedules. It’s really interesting. No one had done this before. What they have built is an assembly line to 3D print at volume. They started with dietary supplements. Where this becomes huge is pharma applications. The dietary supplement piece is the low-hanging fruit where they’re focused on to get the scale and prove that this works.
When I saw them, I thought they were really interesting. Then they got into YCombinator. This is one of those cases where I was a follow-on investor. When they had a lead, I said, “I’m in. I love what you guys are doing.” More importantly, they are the right team to solve it. They have essentially two Ph.D.s in Mechanical Engineering and Pharmacology. They had two Sloan MBAs out of that. That’s one example.
Another example is a company called Swirls. This is one of those cases where there’re two to three degrees of separation. I got introduced to them by an ex-Board Member of mine from the last company. When they came to me, it was literally two guys with a white paper. This is in the crypto space. They have essentially invented a better mousetrap for consensus algorithm.
You look at Ethereum and Bitcoin, which is huge but they still suffer from a lot of technical challenges. The performance is fairly low. Ethereum can do 15 transactions per second. Relatively speaking, Visa can do up to 50,000 transactions per second, but Visa doesn’t run a decentralized infrastructure.
What these guys have done is, they have built a platform, an algorithm, and a technology. In some ways, the best analogy I can think of is, if you watch Silicon Valley on HBO, this is what pied piper, new internet, is in real life. This is one of those funny cases where life imitates art. I’ve invested in them a year ago. The company is called HashCraft. They knocked on a number of doors in the beginning. A lot of them were my introductions. It was hard to understand. It took me a couple of weeks to really grasp the importance of what they were doing.