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Nagraj Kashyap

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26
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2017-04-12
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2017-04-12
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  1. “Absolutely Harry and best of luck as a newly minted VC. As I said, you had a great win to it and I'm sure it'll be very successful.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “The one that I personally recently did and that I said yes to was a company called Kahoot. It's actually close to where you are. It's closer to you than it is to me. It's based in Oslo. And what the company really does and why I said yes was they are fundamentally making learning more fun for kids from K to 12. And that is a really, really hits home for me with my two kids and how I want them to be more engaged with what they're doing and what Kahoot does is sort of really brings games or how you teach the curriculum in a gameified way to the classroom. And the reason I said yes was not only did I like the management team, which of course you have to, and the numbers were good. But when I really said yes, was when I saw videos of kids engaging with their teachers on complex subjects using Kahoot and how excited they were. I mean, that was sort of the clinching thing for me is sort of that can bring about fundamental change in our classrooms and it's a good business. So that sort of why I said yes.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “For me, personally, the reason I like Corporal VC and how I measure success is if I am a strong enough signal that I am responsible in some small way to change corporate strategy for a large corporation. That is the reason that I get up every day and do my job is A, I meet very well.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Philosophy to hire my team and train my team, which is I will let you do this because I believe you're smart and I think what you're doing is in the best interest of Qualcomm. And I think you'll look out for that interest and I trust you. And so go make a few investments and I will give you that leeway. And that became my de facto mentor, my philosophy and how I actually hired my team and trained them.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “My biggest mentor without naming the person first is how it came about is when I joined Qualcomm Ventures sort of very, very early on. And we were very early and we were taking bets which were very sort of hard for many people in the company to sort of understand. And so by my mentor by default became the most senior member of my investment community, which was at that time, it was going to be the CEO of Qualcomm, but Dr. Paul Jacobs. And he sort of, he basically gave me the leeway. He basically said, okay, I understand that you cannot trace a direct line between the investment and Qualcomm, but I understand where you're going. You're saying if the company is successful, we'll benefit indirectly and directly. While I don't completely agree with your investment, I will let you do it because I do think that you assembled a good team of folks. And so I'll let you do it. And that was sort of 2003, 2004, when corporate VCs were not well established. And so he sort of de facto became my mentor. And sort of I used that.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “I would like to see a more flexible model all around where it's not one size fits all with the largest funds having to deploy larger and larger monster capital which constrains them on the kinds of things they can fund whether they can fund early stage or later stage the check sizes have a way of taking the industry in matter where you may actually miss fundamental innovation so I would like to have that change in VCR I would also like to have VCs fund more fundamental innovations which I think we have gone away from over the last few years because harder tech i would say more core tech is very hard to fund from a vc perspective semiconductors is a good example of funding that sort of has almost gone away from the vc sector very few vcs will touch semiconductors and it's a it's a core innovation hardware is a core innovation on which software resides so we do need to see continued innovation at the bottom layers but that has sort of almost gone away from the vc ecosystem i'd like to see that come back”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “What Michael Poland has been able to do is not just pass judgment, but sort of go on through the journey and then understood the reasons for why the food is what it is. And I think it's very interesting. And when he passes judgment, it's a lot of credibility when he says things are good or bad because it's actually immersed themselves in the food supply chain. Anyway, that's my six seconds on why I like the book.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “One of my favorite books is The Omnivores Dilemma, and you'll ask me why. And one is I read it recently, so it's as fresh off my mind. Second is I like to know what goes into my stomach. I like to know what my food comprises of. But I think more importantly, if you read the book, what the author Michael Poland's done is it's taken himself in a journey when after the journey is passing judgments and he's taking himself a journey where he actually goes and understands the food supply chain and why it's broken and why things are the way it is. He's not doing armchair quarterbacking and I come back to VC many times. I feel that myself, VC is myself included. We pass judgment too quickly. We meet a company. We really don't know what journey they went through before they got to presenting us across the table. But they basically get an hour and we pass judgment on whether that's good or bad. We don't really understand the journey they went through, why they actually created what they created.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “And because, as I said, come back to weaken train, we can take chances on folks, we hire the best people, you're not rigid in terms of number of partners who can write checks. And so I think corporate VC lends itself a lot more to diversity. And for me, it's not just about numbers. Really, it's about who the end customers are. The end customers are diverse, whether it's buying folks in a big corporation or it's the public that's consuming good. You want to have representation that's commiserate with what the end markets are. And so from a financial business sense perspective, it makes sense to have a diverse set of investors. And so for us, it's been a really, really nice to be able to hire the best people and be able to train them and it turns out if you do that and you have a flexible model, you end up with a very diverse group.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “It's very well known that our overall sector suffers from a lack of diversity, and I think, again, I come back to how we get their start. I mean, getting a start in a VC firm is just very, very hard. I mean, there's, I would say, not the easy route, but the most obvious route is you become an entrepreneur, you sell your company, and then you join a VC. That's one route. The other route takes you from whether it's engineering or liberage to sort of getting some work, getting an MBA, and then sort of finding your way into an associate role, and then you sort of rise up the ranks, but not every associate becomes a GP or managing director. And so there's some attrition there. But historically, it's been very, very hard to see how there's sort of just the fundamental lack of diversity in the way it is. And I sort of trace it back to a little bit of the inflexibility with the VC model and the financial VC model and why I think corporate VC is there's a lot more diversity.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “If a company doesn't do well, there's no strategic benefit for anybody. There's really, we are focused on finding the best companies. They'll thrive financially, but that also leads to these good strategic outcomes for the parent company. So I think the LP relationship is slightly different. And I would argue that we have to actually not just report, but sort of come back to the parent company on many more different axes and just how the financially the companies are doing.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “The way to think of LP relation obviously is a single LP, so Microsoft is the sole source of funds for the group. And that means that we have to report to Microsoft. Just like LPs, you need LPs would like to get reported. They want to find out what investments you've done, what the value of the investments is, you know, are they doing well, not doing well? So a whole host of financial reporting that any other LP would demand. But I think the interesting thing is in addition to that, the biggest value from a microsoft perspective is what's really happening in the startup ecosystem? Where are the pockets of innovation? Where is the puck going next? Those are things that are above and beyond what a traditional LP relationship looks like. And I think most of the value that the parent company gets out of it is in the latter category, not just not the former. Because on the former side, we assume that you hire the best people and you'll make money as any of the VC should be making money. You make good investments. I've always been a believer that good financial investments lead to good strategic outcomes.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “Now, I don't have a crystal ball, but there was a recent report actually just very topical released commissioned by Telstra that came out just a couple of days back which said that they see corporate VC going from 25% to 35%, I think over the next five to 10 years. You know, directionally, I think I view that as a reality. It's going to either stay or grow, but it won't shrink. And as I said, the imperatives for large corporations to find new sources of innovation and to grow beyond what their quote-unquote core business will not go away. And so if that doesn't go away, there is no reason why participation in the startup ecosystem is going to go down. So I sort of have the view that directionally it's headed in the direction of having more participation than less.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “That not only is corporate, we see here to stay as an asset class, it's a critical part of the VC ecosystem, and I would say many, many best practices from what we did at Qualcomm, what other long-standing venture corporate venture firms like Google and Intel have done are now permeating to the next generative corporate VCs. So we should see, I think, a lot of these perceptions go away over time.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Disciplined not willing to stay with the company for the long run. I think what has changed now fast forward a decade or more later is that there is a different reason Corporation in the game. They are not here to make sort of easy money, so to speak. They're here to support corporations. They're here to support their parent corporations in finding new sources of innovation. They're here to make sure that startups work well with big corporations. Some of the startup culture gets imbibed in large corporations from an outside in perspective. And corporations have strong balance sheets. So this is a different time than when a lot of the perceptions of corporate VCs were formed. While things won't change overnight, I think the new breed of corporate VCs are changing the perceptions in a sort of one investment at a time and making best practices that should sort of really allay the fears of financial VCs, entrepreneurs and how to take money from them. So it's not going to happen overnight, Harry, but I do think.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “Absolutely. So, before I start, I'll tell you one stat. I mean, right now, 25% of all VC dollars come from corporates. So from an asset class perspective, it is here to stay. It is not a fad. It is not something that's going to go away tomorrow. And it's a very important part of the VC ecosystem. 25% means that almost every entrepreneur at some point in time will run into corporate VC. So your question is very valid as to when they do run into corporate VC, there's some misconceptions, or to say, the perception that were built over time. And a lot of the perceptions have been built over the last big time when corporate VCs jumped in, and this was in the late 90s when the stock market was going through the roof. And essentially every corporation felt this was an easy way to make money and they all got into it when the stock market crashed. Many of them got out. That led to many of the misperceptions today that still persist can be traced back to the era when corporate VCs were viewed as short-term capital sources, not”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “I think mentoring is critical. I mean, mentoring is critical, but I think, as I said, mentoring alone is not enough because at some point, the young we see or the VCU is coming into the profession has to spread out on their own. And mentoring alone won't do it. What you have to do is after a period of mentoring, you have to allow them to be able to make decisions. And I think ultimately, as I said, you never learn from books. VC is not a science. You can learn it's very much an art. And unless you go through a couple of investments and figure out what works and what doesn't work, ultimately that's what trains you. So you start with mentoring. You obviously have to spend a lot of time trying to adjust, at least impart what you have learned, which, you know, again, everybody has learned something in their lives and there's some value to imparting them to newly minted professionals. But then ultimately they will make their own decisions and learn from their journey and you add that up with the mentorship you provided and that should lead to a good successful career.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “So it's a very varied group of companies you can invest in. We don't have to take 20% ownership because it is not the purpose. We need to make financial return, but it is not a set fund size many times. So I would say the degree of flexibility in how the fund is structured allows us to train the next generation of VCs.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “Absolutely not. That is not the reason. The reason is there is a lot of flexibility in the kinds of checks corporate VCs can write, the kind of stages we can invest in, kind of sectors we can invest in. If you think of a firm that has raised, let's say, $100, $200, $300 million from LPs, you have a set formula. It's very, very hard to change that formula, which is you can do X number of investments. The check size has to be Y. You need to get 20%. And those are sort of almost very hard exceptions to break because that's how the model works. And if in that particular model, you cannot go and say, hey, go ahead and make a small investment and let's see how it works out. You really can't. In the corporate VC environment, we don't have constraints of we have to write a check of X million dollars. We have to get 20% ownership. We only can invest in a sector that the LPs gave us money for. When we invest on behalf of large corporations, the interests are very, very varied. It can be a hardware company one day. It could be a software company next day. It could be a med device company the other day.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “For me, when I say strict methodology, I mean things that have worked and it is really about ownership. And what I mean by that is the lessons I've learned which work well is you hire what you think are the best, smartest people, you give them responsibility very early on and you give them responsibility by letting them essentially write small checks, make small investments. And what that process brings about is it brings about”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “Time frame because I'm taking a lot of the lessons. It took me a while to understand how to hire and what kind of people to bring in. And I feel that I have hopefully the formula right. And now I can accelerate it. And that's what I've done, I think in less than 12 months built, I think a corporate venture capital firm that is already recognized as one of the most active and a good firm to”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “I think some of the good lessons I took, which I sort of, I'm doing it again, basically, is what I learned was you can absolutely take young professionals who are smart, who are just pure smart, who have never done VC, and you can train them. And I have a specific methodology for training, but I knew that I train folks who had not done VC or not written quote-unquote their first check and help them get into the VC world, but also thrive in it. So I think that was the biggest lesson I said was I was successful in doing that at Qualcomm and I felt that I could absolutely do that in Microsoft. And that's sort of primarily how I've done it. I've obviously hired folks who have done VC before, but I've also hired folks who have sort of not written checks or not been allowed to write checks and sort of said, look, you can do that now because I fundamentally believe in you. So I think that's sort of the lesson I learned. It took me, I would say, the best way to think about it is it took 12 years to build Qualcomm Ventures the way it is. I'm compressing that.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “Taking them out for dinner. I was meeting where they were. I wanted to see them in many different settings because ultimately what I was trying to build was a culture that would last long and people who would fit into that culture were not only smart, which many of us in the VC world are smart, but also a specific culture I was trying to build. So it took me a while to build a team, but it was probably the best part of the journey is to be meeting so many bright folks and then trying to figure out which one of those would actually fit into the culture I was trying to build at Microsoft Ventures. So it was really the way I look at it is building my own startup for the first six months and then activating the breast and brightest I hired for the next stage of the firm.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “Well, it was one of the primary reasons I took the job when Microsoft came calling. I mean, there were many other reasons to join Microsoft as a company, but one of the attractions was the fact that I would be employee number one in my own startup, which is the startup in this case is starting up a new venture firm. So it was really very exciting when I got that. I did this once over 12 years back. And the chance, you rarely get a chance to do a very similar thing again because you have a lot of lessons learned. So I said everything I've learned in the last 12 years, I'll take that. I'll jump into it. I'll try to make sure I don't make the same mistakes and do it hopefully much better the second time around. So it was very exciting to start it. It obviously means that you're to build everything against starting with the biggest component of the arm, which is the people. And so from my perspective, I spent the first six months almost just basically recruiting. And when I said recruiting, it doesn't mean that I got people to come up to my office and just had an interview. It meant that I was”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “Absolutely. So, from my perspective, I had a much longer route to VC. I started off as a software engineer and worked my way into being a management consultant, after which I was lucky enough to land into Paul Conventures, which is the corporate venture capital of Qualcomm. So I went from being a software engineer to a man-made consultant and then went into VC. And the way I saw it was as a management consultant. I was doing very interesting jobs almost every projects every three to six months. And it was very, very intellectually stimulating. But I had to travel to the client. And when I joined Corporate VC, I was still doing very interesting things every day, working with different entrepreneurs, but they were coming to me. So I think it was a much better trade for me.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  26. “Absolutely. I'll give it a go here. And Harry, I think, first of all, before I start, congratulations on getting your way into the wonderful world of VC. That's very kind. I have to tell you that was the most innovative way of ever seeing anybody get into VC. And when my kids asked me how to get into VC, I said, well, I have a role model for you now. But that playbook is taken, so you have to do something else. So that's what I generally tell them.”

    2017-04-12 · The Twenty Minute VC · 20VC: Why Young VCs Must Have Cheque Writing Ability & Why Corporate VC Is The Best Training Ground For New VCs with Nagraj Kashyap @ Microsoft Ventures · IDENTIFIED FROM THE TRANSCRIPT · source