YouSaid · the spoken record

Alicia Wisel

lines on the record: 61
first: 2018-11-17
most recent: 2018-11-17
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Pretty young, I actually messed up, and I could still see it. I messed up in a competition, and I still won. And it was because you couldn't tell because I just kept going. And so that's what you learn.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“And it doesn't always go perfectly, and sometimes you fall, but that doesn't mean you're not going to win. Very early, I actually won, by the way, my parents tell me I would have quit figure skating except for I got a first place trophy in my very first competition. So my parents like, oh yeah, that's it. Game over. Keep doing this.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So I started skating when I was six, and one of the great things about skating is there's nothing harder than the audience in front of you, like the judges behind you and you in the center of the ice alone, right? So there's nothing else that ever feels like that. So it was a really good learning experience. But one of the great things about skating, which you only learn as you get older and then you read a thousand books about grit and everything else, which is one of the things about skating, and a lot like gymnastics, is you fall a lot like a lot, meaning every time you're learning a new jump, you're like spending the entire time on the ice, like soaking wet, coming off pads all over the place so that you don't injure yourself. So what you learn is you learn to get up. When you spend half of a practice session on the ground, you learn to get up and you learn that failing, that the only way to learn is to fail. And again, when you're”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“The whole organization because in an organization of tens of thousands of people, there's a lot of people every day who just have to be with their clients, execute, and they need to have fun doing that and not feel like they're not doing the fun stuff, that all the fun stuff is the cool innovation in the corner. And part of, again, this accelerate idea was around giving people the opportunity to do that while still allowing them to do their day job.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, the way that we're focused on it, but we're still working through it, is where do you want to be? So where are you today? Where are you today? We always have to do the math. Where are you today? What is the, if you look at all of the growth plans that exist, everyone's plans, where does that get you to in the next three to five years, and how big of a delta is that from where you actually want to be? And in a regulated institution, actually, it's pretty complicated because you have strategy, you have finance, and then you have regulatory, all three, which you actually have to figure out to get you to the promised land of where you want to be. If you don't have a perspective about where you want to go, yeah, then you get stuck in the individual details that are teaching you how you can grow a couple more percent when you're missing the big picture. So we try to focus on where we want to go. And then the other place is there's a lot of really important things that have to happen every day. So you talked about innovation being a vacation, innovation for fun, right? You could get to a place where you actually distract.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“I've seen innovation used to solve all sorts of ills. Like maybe in the most pernicious case, it's like, oh, here's someone that's not very happy. Why don't you go work on an innovation project or try and for whatever reason? It's a common thing. Otherwise, it's just the company isn't doing very well. Maybe let's innovate and that'll solve the problem. Other ones is like, here's a very specific problem that we need to solve, right? How do you, at the highest level, think about prioritizing what you work on? I mean, the way that I hear you describe it, I love it. And I actually love this tension between you come from an M&A mindset. It's like this almost like this free market thing. There's a lot of kind of organizational impacts that have. So as the environment shifts and it will, how are you going to think about how you prioritize which efforts to fund, which efforts to kill?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Own strategy. So you weren't going around and telling people how to operate their business, but you were setting a broad strategic objective. Clients are at the center of everything we do, innovation, diversity. And then there will be places where you're building a new business or you need cross-divisional collaboration. And so that's where we get involved. We try to leave divisions to their own devices, however we try to be helpful. So in places where we think there are new ways for us to help divisions drive their strategy, I'll send actually generally a more junior member of my team down into the division and basically offer their services for free. And they find it incredibly helpful and it helps them build a relationship. And what you find is that you get a lot of phone calls for people to ask your help. But one of the things I say when I first started, if you're the CFO of Goldman Sachs, you get a calendar. People know what committees you're on. People know what you're supposed to do. No one knew.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So when I started this strategy team at Goldman Sachs, the 40,000 employees was five people. So we've built the team and actually not by design a little bit by accident, but because I wanted diversity of thought, we've actually built a very diverse team from background and just where they've come from in terms of experience. So it's not all a bunch of investment bankers that worked in financial institutions. We have plenty of those, but we also have people of really broad backgrounds. The second thing, which is where we started, which is that M&A and strategy were going to be together, meaning that we weren't going to separate M&A and strategy, that they needed to be together, and that are investing on the balance sheet was going to be done also alongside us, meaning there's this idea of should you build it, should you buy it, should you partner, and so all of that decision making was going to happen together. The other thing we decided, and this was advice I got, I think I still agree with it, is that divisions should be responsible for their”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“And as you build out your organization, maybe you can talk a little bit about the team structure because this is one of these unending quagmires that nobody's ever figured out. If you're on top of it, maybe you drive too much influence and then you don't get the innovation. If you're an influencer, then maybe nobody will listen to you type things. So how have you thought about doing the organizational structure around this?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“And by diversity, I don't mean the traditional view of diversity, I mean diversity of thought, diversity of ideas, diversity of geography, diversity of ways of doing business, diversity of ways of finding M&A and investing ideas. The idea really is that we need to look at things from a new perspective. But one of the things that we are running out of my team, which is related to this, is launch with GS, which is our commitment to invest $500 million in women founded owned and led businesses and to invest client capital in women managers. And the idea behind that was actually quite simple. We felt that women were not getting the capital that they needed or deserved, and that it really meant that they were a good investment. So there's a lot of capital out there, which many people know, but in a place that's being underinvested, we thought there was a really good investment opportunity.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So, it started in January. We knew new executives, so we won't go through the Goldman Sachs Grand vision. But in terms of where I've been focused, it's basically on three things. One is client centricity, and that sounds really obvious, but as a firm, we're actually organized in a quite siloed, divisional way. The way that we talk about ourselves has not always been with the client first. And so one of the first things that we decided to do was really focus, make sure it was clear that we were focused on clients. So clients being at the center of everything we do and really looking at everything through that lens, whether they're corporates and governments, institutions, or individuals. And when you take a really complicated investment bank and you wipe away all the complexity and just say, all I care about are the clients, it makes it a lot easier to think about what the innovative ideas are. The second thing is innovation, which I talked about through Accelerate. And then the third piece is around diversity.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So I've been kind of drilling down to some specifics. That'd be great if you could provide kind of like a broad view of your vision for the role and kind of some efforts that you've kicked off and just kind of bring it up a level.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“For strategic investments, and some of it, some of them are companies where we're going to use their product. Some of them are companies where it does not make sense for us to own the whole business, but we want to be a key strategic partner. There have even been places where we have built businesses and spun them off. We try to take a holistic perspective on this. There are, though, investing businesses that have nothing to do with the balance sheet and strategic investing and their fiduciaries.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“It's actually interesting, right? So you guys do do investments. Actually, you've invested alongside us on a number of deals, including Barefoot, which I'm actually pretty close to. But I've almost always viewed Goldman Sachs investment company as fairly financial, right? But now there's an opportunity of doing strategic investments. If a vendor makes an investment, you're like, oh, they're probably lining with their business, and maybe they'll do an M&A later on. Have you turned that corner that now your investment committee is something that, or maybe you were there all along that is actually aligned with your role and your internal innovation strategy, or are they still pretty separate?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Tech and engineering team has to deal with it. The second thing is if you have a perspective around it's not buy or build, it's both, then you are going to force yourself to deal with individual vendors in a lot of cases because you are looking for very specific solutions. Of course, like every big company, we have both. We have very big vendors and we have very small ones. But we are quite open to dealing with smaller companies. And one of the benefits of dealing with smaller companies is you do have an impact on how they're going to actually innovate.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So, one of the benefits we have around innovation is that we are investors. So, we invest on the balance sheet, we have funds where we invest across the spectrum of size and stage of companies. And one of the benefits of that is some of this dialogue has a dual purpose, right? So there's the what makes sense for us from an internal innovation perspective. And by the way, it doesn't make sense for us to use it or there's no use for it inside the firm, there may be a place for us to invest inside the firm and then, oh, by the way, we also have an advisory practice that cares a lot about building relationships with new companies. So I think some of that inbound inquiry is less destructive for us because we have all these places where they can be potentially relevant to the firm, whether it's an investment banking and asset management and wealth management. We want the companies coming to us. We want new and innovative companies calling Goldman Sachs. So it's a little bit less of an issue. Certainly our”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, exactly. So, one more thing I wanted to touch Comb the landscape of innovation, talk to as many as possible. Have you explored kind of this tension as you move away from just doing internal efforts to working with partners? And then how can you trade off between this is Cisco and they do everything versus here 50 startups who knows what they do?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Because we're investment bankers, we have to do all this stuff right now. Yes, exactly. We've tried to institute what we term an ROI framework around innovation. And honestly, we're just working and we're just getting started.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So we think the thing I talked about, the accelerate idea that we talked about one of the benefits of it is that we're going to fund some stuff that fails for sure. And if the team does a bad job, the team is going to fail. And so we will make sure that that happens. But if the idea fails, but the team did a Did a great job, then we're going to celebrate that. And so it's only by example, to be perfectly honest with you, it's going to take us a while because I think you got to demonstrate that if you do a good job, but for whatever reason because lots of startups fail, your idea fails, it's okay.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So instead of creating conflict, you say we're going to build this, how would you like us to build this? To your point on do you create things that are truly providing good customer service or are you just because you have a monopoly? So it's the best way to do it, but honestly, the only way to really do it is for the top to be focused on this. So I'll just give you an example. So David took over recently at our very first meeting with the senior executives, he said that we have to get to yes faster and we need to learn to fail. And that may sound like genius, but to the Goldman Sachs organization that's been around for 150 years that prides itself on being the best at everything. Failure is not something that's super easy inside the halls of Goldman Sachs. If you teach people that failure works and is okay, then they're much more open.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So, the way that we like to think about it is we like in places where we're worried about that, we try them to treat the internal organization like a customer. So first best customer, right? So instead of treating them.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Because everybody has an opinion. This is such an issue. Actually, one of the bangs, I feel like I've seen the entire gradient of solutions to this. And the most extreme I've ever seen, like the bank literally created a new legal entity. They had a new building, and then they hired people into this building. This was around this cloud effort because Core IT was going to kill it, et cetera. It actually turned out to actually be quite successful, except it probably grew at half the pace it normally would if it was internal and had access to the internal resources, et cetera, et cetera. Kind of had all the problems like a traditional startup has with access to the customer. So have you thought about to what level you can provide isolation to these efforts and still give them access?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Protected from budget issues, protected from the people whose jobs they're impacting because you're absolutely right. This is the typical innovator's dilemma, which is certain businesses are easier for us to build because they're separate and apart from what we do on our, do every day, which again, this is more the consumer business. But another thing that we're focused on that we've talked about is cash management and payments. Well, this gets to the very core of what we do every day. It's our core investment banking clients. It's core to our internal payment functions. And so protecting that team is actually significantly harder than protecting a team that's just doing something totally new.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So, a couple things. One, when I first started, I still spent a lot of time, but I directly went to Alicia Wisel, who is our CIO, and now George Lee, who's here, is co-CIO. And we agreed that there was no daylight between firmwide strategy and tech strategy, meaning there was nothing like the tech guys are off doing that. And Firmwide strategy wants to do that. And then when for my strategy wants to do something, you can't get any tech resources. So no daylight, meaning that we don't, again, we don't always have to agree, but then we have to debate what the priorities are going to be. And so it helps a lot of the problem. The second thing is you do have to let certain experiments just run on their own. And so we have an R&D function inside of engineering, which is a good place for that. The accelerating team, which is in Frontwide Strategy is a good place for that. But we basically have pockets where people are protected. And by protected, I mean...”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“I think rules around this are great ideas. Don't build your own thing or whatever. In my experience, organizations probably change a lot slower than the rules change. And in particular, and I've seen this a lot with the large banks, actually particularly outside of Goldman Sachs, where there's an effort to do an internal project, and it's the cool thing for a few months, but then the white blood cells come out and they kind of come in and they have this slow death and whatever. Have you thought about how in addition to the rules you actually protect these internal efforts from the momentum or the broader momentum of the organization?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Of stuff that's generally available off the shelf. There are things that we believe are areas where we're not serving the customer well. They're really solving an unmet need for us. Our tech guys will tell me that's more and middleware for us. We're going to build that stuff ourselves. We're open to ideas, but we're going to build that stuff ourselves. And then there's another layer. And this is what I was talking about a little bit before, which is sometimes you just don't have access to the talent or the capability. So there are highly innovative solutions that we do think are differentiated, but we are also going to get those from the outside. And as I was talking to our team before coming here, they mentioned to me Pin Drop as a great example of something that we thought was innovative and differentiated, but we were not going to build ourselves.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So, the way we're thinking about it is there are certain things that are more commodity or exist, meaning the products exist out there. They work great. We should use that. We are using that. And one of the things that we've done in the past, which has not been great, is that we've then customized those products. So we've tweaked the things that are available. And the problem with that is that you stop getting upgrades when you tweak. And it's very hard on smaller companies when you do that. So we have a rule now against doing that. So I hope for that makes people feel better. We're going to stop the tweaking of”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a good question. So, a couple things. So, history, when I started in 1999, we had just stopped using the word program that we had created for ourselves because Microsoft Word didn't work for us internally. It does now, but that's okay. So that's where we started.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Trying to get better. Can I put a little salt on that wound? Yeah. You built everything from your own white box switches to, I remember you were the only big ESX customer that didn't use vSphere. I mean, it was really one-off. And I actually think that within the startup community, there's this view that Goldman Sachs is the one that's not the others, even including the big bangs. And so how do you manage that tension of do we build this very unique Goldman Sachs only thing versus kind of the broad partnership?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So, some of that is your question on biverse build. So if you're competing your own internal projects with Either buy and buy buy, I mean, just buy the product from a software other perspective or buy, meaning buy the company. If you're doing that in a relatively systematic way, I think you're avoiding some of those problems. The other point is there are certain solutions where did we build the exact perfect thing that would have been perfect for everyone else? No, but we build something that was perfect enough for us. And so that's the kind of it's core to us. It's part of our DNA. We want to do it. And I'm sure we'll get to, you know, we have a long history of having built a lot of stuff. Internally, we're trying to get better.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Awesome. So I want to dig into that a little bit more. So this is kind of the issue I always had with kind of internal startups, which is if I had a founder come to me and say, okay, listen, I have one customer and I will always have one customer. I'm going to work with that one customer to create my product. And that's going to drive everything, including the economics. I wouldn't be convinced that A, you know, they're solving a real problem. They've got a repeated product to market. It's almost like economic Darwinism has been brought to bear on this problem, right? And so how do you provide an environment where you're actually confident that the internal efforts are going to be solving real problems versus being these kind of ingrown efforts?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“There's a whole, there's then levels of things that we have no business doing inside Goldman Sachs. So I think companies get in trouble when they try to do things that should happen externally internally. And what I mean by that is I think there are certain types of talent that have no desire to work inside an organization that has 40,000 people that's highly regulated and is publicly traded. And so we need to harness those skills and that intellectual capital and they're not going to harness it inside. And those types of things have to happen outside, and which is why we need to partner with the venture community, with accelerators, with incubators, but we shouldn't be doing that stuff ourselves.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“I think you can do certain things inside big companies. So I'll talk to you about what we're doing and you'll tell me. So when I first started, we announced this thing called Accelerate, which was the idea that we thought the people of Goldman Sachs had really good ideas, but they were having a hard time getting them through our organization. So we went out to all 40,000 employees and said we're open for ideas. And so we got almost 1,000 ideas, and that was a lot more than we expected. And we developed a system, and we got them down to about 150, and we had them pitch, and we've gotten them down to kind of 10 to 15 that we're going to fund. So we're going to figure out if you can really do startups inside Goldman Sachs. But what we learned was that there are businesses that are critical to what we do and can only be built inside Goldman Sachs, meaning they are directly related to everything we do every day. They're directly linked to compliance and our balance sheet, and building them outside is going to be too difficult.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think the reason why I'm in this CD is historically Chief Strategy Officer Goldman Sachs really did special projects. So the last person is now the CFO and started and helped build the markets business. There was a desire at $100 billion in market cap for us to build a world-class strategy and MA function. And the view was that I had seen that given my previous experience. And then I also had built a business inside Goldman Sachs from a clean sheet of paper. We like to call it startup inside. Goldman Sachs, and not many people had done that. And so when I got the job, they handed me a white sheet of paper and said, go tell us what your job is.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So I was totally surprised so much so that when they called and asked me for the job, I was at home because I was traveling all week and I was about to go to the airport. And I paused for long enough when I was asked that the person asking me say, you know, it's a really big job. I was like, I get it. I know what my answer is supposed to be. I just wasn't expecting the phone call.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“We're a global business. We have big business in Asia and in Europe. We tend to be relatively New York centric from an operations perspective. And again, I talked to you about how we're transitioning our management team. As we're doing that, I think there's more of a need to spend some time internally. But when I first started my job, I actually went to Asia in the first couple of months because it was really important. It's really important to our business. It's really important to the future. And I thought it was important that they see me.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“To some of the deals we've done. We also bought Jay Aaron. And one of this whole idea about being humble, our last CEO came from Jay Aaron. So that was an acquisition. Actually, our CEO and the COO came from Jay Aaron, which was a commodities trading business. So that was a much, you know, the people from that deal would say they started in the garage in the basement, and they ended up in the top of the building.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So recently, most of our MA has been in the consumer business, which is more of a newer business for us in our investment management division on the asset management side. And the reason for that is that you can do smaller, either more tech-focused or tuck-in acquisitions. So just as an example, so we've been building a consumer business. We bought the GE deposit platform. We bought Clarity Money, which is a personal financial management tool. And we bought Bond Street mainly that was an AquaHire. We basically hired the people and we bought final for some of the IP and for the people. So that is kind of the full spectrum of how we're going to think about M&A, which is buying things that are pre-revenue product, buying things that have revenue that would be GE deposits, and then buying things more for talent or for IP. And then on the asset management side, we've done, again, smaller, more tuck-in asset manager deals. If you go way back.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, exactly. So I kept a couple of clients on the Because I've just recently started in the strategy job and we have a new CEO, COO, and CFO, we are really more focused on the strategy side of the equation than we are on the M&A side of the equation. And what I mean by that is that we're just figuring out exactly what our long-term strategy is going to be. We've been around for 150 years, so certainly we have a strategy, but we're really, you know, we've talked about this publicly. We're really looking at every business from a front-to-back perspective, all of the end markets that we're in and not in and figuring out where the best places are for us to compete where we feel like we have real superpowers. So interestingly, even though the world believes that, oh, we must be doing a lot of M&A, I've actually spent more time thinking about strategy and innovation than I ever did in my old job.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“And if you stop and actually have a group of really smart people internally and maybe with your external advisor say, we're going to show up for one day for two hours, and we're going to make the case. On the other side, and in the process of making that case, I've seen, by the way, very large companies change their mind and avoid mistakes. But I've also seen them, they figure out what are the pinch points for where there might be failure. And it helps to embolden you to say, we understand the risks, we know what we're doing, and we're going to go forward, but we know where the mistakes may happen.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, you can't hide when you close a deal and you own it, right? You can't hide from the outcome. One of the things that I've seen companies do, which I think works particularly for large businesses, is they do a red team-green team. At the end, at some point in the process. And what I mean by that is you get to a point where you've decided what your strategy is, you really want to buy this business, know what you want to pay, and you're there, and there's nothing that's stopping that train”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“I think in general this question is terrifying for a lot of business leaders. It certainly was for me. And I remember thinking buying a company when you're running large businesses, one of the few decisions you really have to live with, a lot of the other ones you kind of work your way out of in some way or another. And so I was petrified for the first kind of few M&A deals that I was involved in. You've overseen hundreds of billions of dollars worth of these deals over two decades. How do you prepare or maybe prepare CEOs or business leaders for the mental wrath of doing M&A?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it depends. I think there are certainly some industries where it's more of a winner-take-all, winner-take most. And getting the premier property really matters. But if you're a big company and you have access to, for example, clients and distribution, maybe the party that's number two is a number two because they don't have access to that. And so then they have the same product, but they don't have access. So then you should buy the number two and not the number one. And maybe the number one has a much better product, but it only takes a small tweak to make it better. But when you're going after product and technology, my hunch is that paying for the number one makes sense.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Let me get to my whole strategy Another thing I wanted to kind of probe, which is there's this adage, at least in tech, at least in Silicon Valley, that you go after the premier property. Some people believe that's the case because it's the best thing you have. And then there's this other view that it's overvalued, so you actually want to be in the number two either as an investor or that's what you want to acquire because let's say you own distribution or whatever is maybe there's value. So how do you think about this question of premier property versus the number two and how that fits within the strategy?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“So we haven't even let me get to my whole strategy point. But so when we talk about strategy, I'll talk about clients being at the center of everything we do. And I don't think we'd have very many clients if all we cared about was getting deals done. So I think if we'll do my pitch for being a good investment banker, but if you're a good investment banker, you understand your client. You understand the types of things that are going to work for them or not, and you help them when it's not working.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“And so taking a group of people internally who have experience with MA, who know the internal business, who know how to get things done from your internal engineering team, from compliance, having an internal team and pairing them with the company, I think is really important. We talk about it a little bit as the bat phone. Like, who's the bat phone to the person inside corporate to actually get something done? Because those first hundred days tend to be really important for someone who comes new to a job, for a new company that you've bought. And what can really kill you is if you're sitting off trying to get stuff done and you can't get access to the internal. So if you've bought something where you want to leave it off to its own devices, but you want to make sure that they don't You got to give up a bad phone.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“You understand one, it's helpful if you don't end up, you haven't bought a big innovative business and the market turns. But the second thing is you know what you bought. And what I mean by know what you bought, that's particularly important in the enterprise space where it's more confusing, right? A company, you sell a lot to a certain sector, and then you buy another product that you think goes into that exact same sector, and then you actually find out that the sale is made by two different people for two totally different reasons, and there's actually not the synergy that you thought was going to be there. And so being right about that, I find is really important. But even if you're wrong about that, then the question is, what happens?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Maybe I'm great from the sell side, right? Maybe let's talk about it from the buyer side, which is like, you know, a lot of acquisitions and especially mergers do fail because it is difficult to kind of digest something that large, right? And so how do you think about kind of the preconditions for a successful acquisition post sale? And you talked a little bit about that from being humble about acquiring the team, et cetera, but not being in a reactive state also seems how do you think at a macro level when it comes to strategy making sure they're successful?”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“Wanted to win but was afraid to lose. When you had the guy or the gal who thought that their biggest rival was gonna buy something, that was how you actually got them to pay a lot. So I try not to be that person.”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source
“This gets to people everyone being at the table. So if you're going to buy something for a couple million dollars, you probably don't have very many senior people at the table. And therefore, who actually has a vested interest in the success? Rather, if you buy something for something that is a lot more zeros than that, there's a lot of people at the table and there's a lot of people who have decided to do it. And whether they all agreed or not, at that valuation, they're going to get behind it. So there's just a higher cost of failure. And when there's a higher cost of failure, people tend to focus. I don't think it's a reason to get people to pay more. But when I was on the sell side, it raises this, there are these deals where there's kind of no value, meaning it could be worth anything, depending on how much you need it. And even more importantly, how much you think someone else needs it. When I was on the sell side, my favorite thing was to find the buyer who not only”
2018-11-17 · a16z Podcast · a16z Podcast: M&A and Innovation, Inside Out · IDENTIFIED FROM THE TRANSCRIPT · source