1Mby1M Virtual Accelerator Investor Forum: With Asheem Chandna of Greylock Ventures (Part 1)

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Asheem Chandna, Greylock Ventures was recorded in September 2016. 

Asheem Chandna, General Partner at Greylock Ventures, talks on the topic of funding fat startups, something Asheem has done routinely, one of the very few VCs still doing so. Very interesting discussion.

Sramana Mitra: We’re going to start with some level-setting. You’re one of the very few VCs who still practices real venture capital – as in financing concepts for developing significant products. These are not revenue-generating businesses, which is where venture capital is slowly moving to or has already moved to. Please share with us a couple of case studies of concept to scale financing that you’ve done and that have worked out particularly well. What is your thinking in how you choose to do those kinds of businesses? What can we learn from it?

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1Mby1M Virtual Accelerator Investor Forum: With Cem Sertoglu of Earlybird Venture Capital (Part 3)

Sramana Mitra: I know you read some of my writings. I’m a huge proponent of bootstrapped entrepreneurship. Having worked in this ecosystem for all these years, I’ve observed the development of different ecosystems in different parts of the world.

Bootstrapping happens to be one of the really important ways that ecosystems come up. You get a few startups that become successful in a bootstrapped manner. Then the investments start.

What is the status of the Turkish or Central European ecosystem vis-a-vis bootstrapped entrepreneurship? Are you seeing a lot of bootstrapped companies getting further along and then seeking funding? >>>

1Mby1M Virtual Accelerator Investor Forum: With Ashmeet Sidana of Engineering Capital (Part 6)

Sramana Mitra: As a VC, how do you figure these things out? These are not easy to figure out.

Ashmeet Sidana: It comes from good judgement. Good judgement comes from bad experiences. You have to try things. As you can see over here, I have no shortage of gray hair. Some of these have come from having done well, but some of them have also come from making mistakes.

I don’t think we have yet distilled this into a formula or a method. I can tell you that you can spend an hour with a person and walk away with a deep impression of, “Is this person truly motivated? Are they just interested in status?” You talk to a person who >>>

1Mby1M Virtual Accelerator Investor Forum: With Cindy Padnos of Illuminate Ventures (Part 5)

Sramana Mitra: One of my observations is lots of stuff have already been built. Nowadays, there aren’t so many wide open opportunities, especially in B2B that you can consistently build billion-dollar companies. There are many niche opportunities.

Some of these businesses need to be built for very small amounts of capital – $1 million to $2 million and then sold for $10 million to $15 million. Maybe even smaller – $250,000 to $500,000 and then sell for $5 million to $10 million. Do you have appetite for these kinds of investments? What is your analysis of this dynamic in the industry? >>>

1Mby1M Virtual Accelerator Investor Forum: With Cem Sertoglu of Earlybird Venture Capital (Part 2)

Sramana Mitra: What do you see? Is it B2B or B2C? Where is the sweet spot of your entrepreneurs?

Cem Sertoglu: We have two very distinct strategies that we focus on. The first is what we call local champions. These are focused on large markets. We would probably back these companies only in markets like Turkey, Poland, Ukraine, or Romania, but not Slovakia or Estonia where the local market is not big enough. In these businesses, we look for proven business models and technology. These are models that have worked elsewhere.

Sramana Mitra: Concept arbitrage. >>>

12 VCs, Angels and Seed Investors Pinpoint Where They Want to Invest via the Virtual Accelerator Investor Forum

To benefit entrepreneurs who are seeking funding, I’ve asked many investors to pinpoint what they want to invest in and exactly what they are looking for in startups. Industry trends, segments, locations and areas of personal interest all play roles in developing an investor’s investment thesis. Read the following investor interviews to learn exactly what these VCs, Angels, and seed investors are looking for in startups.

Ashu Garg, General Partner at Foundation Capital, outlines the top trends driving startups and venture capital from his firm’s perspective.

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1Mby1M Virtual Accelerator Investor Forum: With Ashmeet Sidana of Engineering Capital (Part 5)

Sramana Mitra: This company is selling to enterprises?

Ashmeet Sidana: Menlo Security is focused primarily on large enterprises. If you’re a bank or financial services enterprise, that is our target market. You have to be very careful what you do and yet you have tens of thousands of employees who have to be able to interact with the web.

There is no modern business that can run without access to the web. Yet, anti-virus was not solving the problem. A radical new technology with a fundamentally new architecture creating real business value is what we’ve been able to create with Menlo Security. >>>

1Mby1M Virtual Accelerator Investor Forum: With Cindy Padnos of Illuminate Ventures (Part 4)

Cindy Padnos: We structure our seed investment with, at most, three other co-investors, but typically have one co-investor. We think it’s really important to be investing with like-minded investors.

It’s also a bit dangerous to have a very large fund writing a small check into your seed round. It’s a significant signaling risk if that fund doesn’t come back to lead the Series A. The question is why not. It might not have anything to do with the company. It might be as simple as the fact that that partner had another company that they financed three months ago and they just can’t take on another new investment right now.

Sramana Mitra: What you’re talking about is this trend that has come together in the last decade – spray and pray. There are lots of funds that are putting a little bit of money in a lot of deals and just not taking any Board seats or any real skin in the game. That has become very popular right now.

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