VC Panel hosted by David Hornik discusses investing strategy, exits, secondary markets, and cologne
David Hornik of August Capital has become a regular at Vator Splash, and he always shakes things up. Personally, I love him because he always shows up in his Chuck Taylors.
So tonight we did something different: Late Night with David Hornik. Hornick took the stage and opened with a Jay Leno-style monologue. "President Obama was here this week. He booked a room on AirBnB--he stayed on Yuri Milner's couch for $75." Ba-dum-psh! "The next morning, he trashed Yuri's kitchen."
First up on stage with David: Josh Felser of Freestyle Capital.
"We were on this vacation recently and we were talking about the secondary market 'cause we're losers, and I said it's going down, the government is not going to stand for it, and you said you love it," said Hornick.
"You were right, the government would eventually clamp down," said Felser. "But now is a good opportunity to buy shares on the secondary market. The longer companies take to go public, the more they're going to have to make these options available to their shareholders."
Joe Kraus of Google Ventures was the next up on the stage.
"You're at Google--and Ventures," said Hornik.
"Like a Reese's Peanut Butter Cup."
When Hornik asked his guests how many investments they'd made this year, Felser admitted to 12, and Kraus boasted of 60 investments so far, but Google Ventures is on track to make 80-100 seed investments this year.
"That seems like a lot," said Hornik.
"We do a lot of data analysis and we have a thesis on the seed category; part of that strategy is to make sure we do 80-100 a year," said Kraus.
"It's part of a strategy?!" said Hornik. He turned to Felser: "Do YOU have a strategy?!"
Hornick then welcomed Alex Rosen of IDG Ventures up on stage. "Are you doing the seed thing?"
"Everyone's doing the seed thing," said Rosen.
"How many?" asked Hornik.
"Uh...two. We look at 700 deals a year and invest in 5-7," said Rosen.
"Those are bad odds," said Hornik. "That would be bad if you were sick and those were your chances of living."
In keeping with the "Late Night" theme, Rosen actually came prepared with a David Letterman-style Top 10 list on why the market is optimal right now.
10. $20 million pre is the new $2 pre
9. Lady Gaga, Ashton Kutcher, and Kim Kardashian could all be on your board
8. It doesn't matter if the development team hasn't showered if they're all in Ukraine
7. There are twice as many investors as entrepreneurs, angels, super angels, micro VCs, Big VCs...
6. Raise money now cause half of the investors were in the 10th grade during the first bubble
5. Cause nobody actually knows what's in the cloud
4. Because getting insurance is really cheap for a 25-year-old CEO
3. Because our industry really needs another million dollar startup launch party
2. All media now is really old media
1. Because if you succeed, Justin Timberlake will play you in a movie
On the Ashton Kutcher note, Hornick brought up the fact that Kutcher was just on Two and a Half Men and had a laptop with stickers promoting all of his investments, which he called a "really ballsy move."
"Are you guys scrambling for celebrities on your board?" asked Hornik.
"I have no idea what it would be like to have them on the board. I don't know if they're going to demand special treatment...certain treats in the waiting room..." said Felser.
Finally, Hornik invited Eghosa Omoigui of EchoVC Partners up on stage.
"You left a more corporatey empire than Google--the land of Intel--to be an independent agent. You're investing in these early stage things. Have you started, are you getting ready to angel invest?" asked Hornik.
"I left Intel in July 2010 and made my first investment in August. I led my first investment in October," said Omoigui.
As to how many investments he's made this year, Omoigui identified ten, and said he's already sold one.
"Already?! You've been at it since August and you've already sold one?!" said Hornik.
"To Google, actually."
"I've been at it for 11 years and I haven't sold shit!"
"There are too many seed deals, too many entrepreneurs who shouldn't be, too many people who want to jump to the end without going through the motions, so it's easy to say no," said Omoigui.
"You smell lovely," said Hornik. "I understand it's not just happenstance that you smell lovely."
"Everyone has a hobby. Some people collect stamps, some people go on vacation and talk about secondary markets. I collect cologne," explained Omoigui. "I started when I was 10. I stumbled upon a few, and then I started researching them, and now I have just under 300 of them. Now I don't just wear one, I wear two or three and combine them."
"I'm feeling stinky... So Joe and Josh say they have strategies. What's your strategy?" asked Hornik.
"I have a thesis-based approach. There are specific things I look for. I tried to invest in Facebook a few years ago, and that was based on the idea of social networking as a thesis. Then I invested in Six Apart based on the thesis of blogging as tool of self-expression. Right now I'm really interested in people who ingest content and regurgitate experiences."
"If you could give me any cologne advice, what would it be?" Felser asked Omoigui.
"People buy cologne based on what other people smell like, but you need to buy cologne that's for you. Like you look like an outdoorsy, woodsy kind of guy."
And then Joe Kraus told an amazing story about meeting Bill Gates at a urinal at the Microsoft office. He had gone to Microsoft to negotiate an acquisition of his former company Excite. Strolling into the bathroom with his VC, Vinod Khosla, bam--there was Bill Gates, standing at a urinal. Kraus went to the urinal next to him so that Gates was on his left, while Vinod took the urinal to Kraus' right and took the opportunity to introduce Gates to Kraus. Kraus admitted that not only did he panic over the idea of whether to reach over the urinal to try to shake Gates' hand, but he ended up not being able to pee the whole time he was standing next to Gates.
In summary: Best VC panel ever.
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Joined Vator onEghosa Omoigui is the founder and Managing General Partner of EchoVC Partners. Before this, Eghosa was with Intel for nearly 10 years and his last role was as Intel Capital Director, Strategic Investments, Consumer Internet & Semantic Technologies