Neil Sequeira had a front-row view of the dot-com bust, first at short-lived incubator CMGI and later at AOL-Time Warner. But those experiences didn't scare him off venture capital; he joined respected Boston firm General Catalyst Partners. And four years ago, the San Jose native returned west to open its Silicon Valley offices.
In this week's Elevator Pitch, we ask Sequeira for his take on the differences between the bubble and today's frothy tech scene.
Q How'd you get into this racket?
A After graduating from business school, I joined CMGI, which was one of the few public VC and acquisition firms at the time. As the market dropped, we went from buying companies to selling them. I got to work with management teams, fix problems and find a way through tough times.
I then joined AOL during its height, followed by the painful merger with Time Warner. The skills I learned in business development, marketing and sales stay with me today. In the end, however, I wanted something more entrepreneurial.
I joined General Catalyst when it was a young firm, very hungry. Over 10 years later, we're now bicoastal with $3 billion in assets, but we still have that same people-first culture.
Q What kinds of pitches are you looking for now?
A I've successfully invested in alternative commerce, digital media, online/mobile marketplaces and software-as-a-service. Additionally, I'm exploring the changes in the food industry, new media/mobile sales/marketing channels and moving hardware infrastructure to software. I want to meet more founders in these spaces.
Q What's the biggest mistake entrepreneurs make?
A Not hiring the best team possible. As an entrepreneur, you have the vision, mission, strategy and goals in your head at all times. The mistake some make is to try to do everything by themselves. It's not possible.
Q What's the next big thing going to be?
A If I knew, do you think I'd tell you?
All kidding aside, I do believe that the way we shop, eat and spend time with our families will inevitably change due to new logistics, commerce and technology. Think about FaceTime by Apple: It allows us to travel and still share face-to-face conversations with the people we care about, in a very simple way.
We're beyond software for software's sake -- we're utilizing the power of technology to touch everything, from farm-to-table to personal health care to how businesses are built. With recommendations, community building and local commerce delivery, we're finally starting to get back to software that delivers value in our real lives.
Q For much of its history, General Catalyst didn't have a real presence in Silicon Valley. What were the upsides and downsides -- and why'd you decide to change?
A GC has consistently invested in Silicon Valley since inception, and we decided to set up our valley office almost four years ago. Why? First, value to our portfolio companies: An opportunity to be one of the few firms able to offer access to potential customers, partners, and talent on both coasts. Recruiting top talent is key for our companies; we have been developing programs with leading universities like Stanford, and it's no coincidence that our Cambridge office is located between Harvard and MIT.
Second, access to entrepreneurs and diverse tech markets: While certain spaces are very strong out east (media, SaaS, marketing services), the valley consistently produces amazing talent and outsize returns in important areas like consumer, marketplaces and infrastructure.
We're proud of our work here so far. We've partnered with some of the most amazing businesses on the West Coast -- Stripe, Airbnb, Snapchat, GoodData -- and incredible founders like Jessica Alba and Brian Lee at The Honest Company and John Thompson at Virtual Instruments. We've also welcomed a new partner, Steve Herrod, who built one of the best engineering teams in the valley as CTO of VMware.
We often get asked how we make a bicoastal partnership work. It's not always easy, but we work very hard to communicate as one team, collaborate on projects and never let distance impact decision-making. Our commitment is to have the entire firm available to our portfolio companies, no matter which coast they call home.
Q How did your experiences at CMGI and AOL-time Warner inform your approach to investing?
A Both experiences taught me a great deal about how to seek out amazing leaders, think through business models, build strong teams and focus. They also taught me what not to do: Get caught up in hype, hyperbole or pipe dreams, which tend to blowup like pipe bombs.
The bubble was a unique market funded with expectations instead of fundamental economics. Today, we see private companies with high valuations, but most also have strong underlying economic drivers.
Contact Peter Delevett at 408-271-3638. Follow him at Twitter.com/mercwiretap.