WH157 | ROOPA UNNIKRISHNAN: THE ART OF INVESTMENT CONVICTION, CORPORATE VC & THE THERANOS BET

And then you use your intuition to say, hey, I'm going to actually assume that one of the better options is door number four.

I'm going to keep an eye on door number one and two and three, but I'm going to actually put a bet on door number four because that's what's unique and different and where we can win, where we have a right to win.

Right.

So this idea is one of the piece.

The other piece is also around like, you know, if you know the story of Cassandra, Cassandra is this.

back to the Greek classics, is an oracle who is unfortunately cursed by Zeus not to be believed.

So she's one of those who says, don't bring that Trojan horse inside, right? And they don't listen to her.

I will often in my strategy roles, there have been times when I felt like Cassandra, nobody is listening to me.

And I've taken away two things.

One is you want to partner with the right organization and leader so that you're able to work with them and teach them to listen to you.

But the second is, how can you start communicating what you're seeing as this pattern, this intuition? How do you communicate in a way that's compelling? So that's another piece that I sort of write about as well.

So that's the overall format, a framing of some of my experiences.

I will tell you that the world of venture capital is an interesting one.

It feels entrepreneurial.

It feels like a lot of action happens in the VC firms.

But when you really consider it, about 30% of S&P 500 firms, S&P 500 companies, have some version of a venture investment strategy, right? So that's a biggish number, right? 120 of the top American companies are doing something with smaller venture investments with funds, right? And then those 30% actually have pre-committed multi-year standalone funds that they put into a budget so there are others which are doing things more informally so if you really i mean there there aren't enough data points out there but if you know based on my experiences i'd say at least 50 of the s p 500 is doing some version of putting you know putting capital into equity funding of startups or pre-public companies out there.

So that's significant.

And more than half of these firms are working with short-term evaluation metrics.

In other words, they have spent some time thinking through what is it they're trying to get exposure to? What is this trend they're trying to test for? What is the technology space they're trying to get into? And so they are laying out some short term cycles so that they can get into either a very early stage so that they can watch it or late stage so that they can exit at the right time horizons, right? They're they're playing at that.

Quite often they're playing at the short game just to see what's out there.

But there's a there's a wrinkle in here in that there's only about it's only about four out of 10 of these companies actually insist on getting board seats.

Right.

So they're they're the only that's a small number that are making significant enough investments and are committed enough to actually want to be on boards.

And so this is something to look out for.

So when you're in your world of venture and if you go out and start creating partnerships with corporate ventures, I know from my experience, it's a better sign if a corporation says, yes, I am going to allocate a leader that I'm going to pay for and it's going to take time from her schedule to actually sit on a board of a startup because that's when you know that there's committed money.