AGM2020: 5 of our Favorite Quotes from Kleiner Perkins’ Randy Komisar
We hosted Randy Komisar at our Annual General Meeting back in October, and he did nothing short of truly gracing our virtual stage. He is many things: an attorney, executive, author, mentor, investor and entrepreneur, with an impeccable and accomplished career to date. Randy is also an ardent teacher. His chat with us was filled with learning but especially, inspiration. He spoke about venture capital and investment in a new light, one that anchors the space as a deeply human experience. Here, we share a few of our favorite, most heartening, quotes from our conversation with Randy.
“Not every place is going to be a Silicon Valley. Not every deal has to be a unicorn. Success is not defined by scale alone”
When we asked Randy about his thoughts on what it takes to build solid entrepreneurship ecosystems, he answered with three key factors: sophisticated entrepreneurs, capital markets and supporting communities and infrastructures. Historically, Silicon Valley has been the central hub for entrepreneurs and start-ups precisely because it benefitted from all three. Today, we are seeing that this is no longer holding true. As more and more entrepreneurial hubs emerge in different countries and entrepreneurs exhibit superior levels of sophistication across the globe, SIlicon Valley is losing its position as the once quintessential home of some of the greatest and most successful businesses in the world. In fact, as Bay Area investors continue to narrowly focus on money and capital, ecosystems of real innovation are quickly springing up in the rest of the world. While the bulk of capital remains in SV, innovation is now everywhere.
“The best entrepreneurs need to be right, not rich”
Spotting a good entrepreneur is arguably one of the most fundamental exercises for potential investors and a key determinant of success for any business. It also happens that it is not always so black and white. Intelligence and tenacity are no longer sought-after traits, but expected pre-requisites. A good entrepreneur is someone with a growth-mindset who not only defends the idea but constantly refines it. Randy also explains that the best entrepreneurs have a chip on their shoulder. They have something to prove, and more often than not, they need to prove that they are right.
In times of crisis, great entrepreneurs sit back, take new information in and reconstitute, and the best of them are those who look at challenges and see new horizons, and in these horizons, they see plenty of new and exciting opportunities that they will then go above and beyond to capture.
“Being a great venture capitalist is about being a great partner”
There are two pitfalls that VC investors typically fall into. The first one is resistance to and anxiety toward change. The second is a desperate quest for that “gotcha moment” - that point when they’ve located a shortcoming in an idea or a decision. While this is a core and necessary part of the due diligence process, in many cases, it is strictly self-serving in that it’s a means to assert intelligence. By hyperfocusing on the problems, investors tend to forget that, at the end of the day, they’re partners, that venture capital is essentially a human experience that is predominantly predicated on people and relationships. For founders, opting for a reputable venture capital firm brings their business a boost of credibility. But, this choice doesn’t necessarily add value. Randy explains that, sometimes, it is better to seek a partner in a smaller firm than to simply go for the big names if that means working with a team that will add sizable and meaningful value to the business.
“I’m a people investor - my job is to sit across the table everyday and listen to some lunatic tell me about some future that I have never imagined, and try to figure out which lunatic I want to go on the adventure with”
There are a number of approaches investors can take when it comes to the direction of their investments. Some of them invest thematically by region or a specific technology; others base the decision on the reliability, predictability and certainty of data and information, while others prefer to invest in and at specific stages. Randy is a people-investor on a constant quest for interesting and entrepreneurial people solving big problems with a value proposition that has a clear path to monetization and growth. He adopts an agnostic outlook to direction, and ventures toward the ideas that others have yet to explore. His belief is that an orthogonal and eccentric approach to investment is where the greatest monetary and non-monetary returns are.
“You can’t afford to put off what you want or care about in the hopes that you can somehow afford to get to it later. That’s just a bad equation”
This is one of the most quoted passages of Randy’s book, The Monk and the Riddle, and we understand why. If there is one key takeaway from this pandemic is that we can’t predict the future and we can’t live off the past. The present truly requires our presence. Founders and investors should be grateful for the opportunities and the people, and take advantage of them like they’re the last morsel of food or the last drop of water.