I had the pleasure of interviewing Ed Sim, Founder of Boldstart Ventures, a first check investor for bold founders reinventing the enterprise stack. Ed currently serves as a board member/observer for BigID, Snyk, Kustomer, Manifold, FortressIQ, Blockdaemon, Wallaroo Labs, and Hypr. He is also a Co-Founder of Mstate, an enterprise blockchain studio to help founders accelerate use cases with the Fortune 500. Prior successes include Greenplum (sold to EMC, now Pivotal — NYSE — PVTL), GoToMeeting (sold to Citrix), and LivePerson (Nasdaq: LPSN).
Jean: Thank you so much for joining us! Can you share your story about how you got into the VC space?
I’ve always been into entrepreneurship, as a kid having started my own window washing business and selling Cutco knives. I knew I didn’t want to go into a traditional finance role after college, so when I heard about VC through my friend’s brother I was super intrigued. The idea of working closely with not one, but several founders creating new products, was quite appealing. Nobody would hire me for a VC role out of college, so I joined JP Morgan on the derivatives investment side and was a glorified data entry analyst. There I learned how to code Visual Basic and automated my job. I remember the day I downloaded Mosaic browser and thought about the future, and I could not wait to get started. I was fortunate enough to find a VC job through the Wall Street Journal in 1996 and I’m still honing my skills 22 years later!
Jean: What kinds of startups do you typically work with?
We own firstcheck.vc, so we like to be the one of the first investors involved. We are super focused on backing technical founders who are reinventing the enterprise technology stack. Typically these founders will sell into the Fortune 1000 where we can actively help accelerate early product feedback and customer traction. We often fund markets a couple years ahead of time before they become mainstream; areas like serverless, intelligent automation, next gen cybersecurity, and blockchain infrastructure.
Jean: What do you look for in the management team of your investment companies?
We love founders who are highly technical and starting companies born out of some pain they have experienced. We call this “founder market fit”; the deep understanding of a problem, combined with a unique technical breakthrough and a track record of building and engineering new products in new markets. Because of this focus, our founders that we’ve backed are mission-driven and focused on delivering a solution to a massive pain-point versus being in it for a quick buck.
Jean: Can you share a story of a successful Angel or VC investment? What were some of the highlights?
While I’ve been fortunate enough to have had some IPOs and large exits in the past, I’d like to tell a story about some companies which are about to take off. Regarding funding markets before they take off, one interesting company is BigID which helps companies understand the risks and potential exposure of their PII (Personally Identifiable Information) through deep data science. In other words, BigID helps solve the GDPR problem which many think is the next Y2K. What’s interesting is that we funded the company a couple months before GDPR was passed in April 2016, and our thesis was that if BigID alone could help companies speed up the post-hack alerting and discovery process, it could be a huge business like Mandiant (sold to Fireye for over $1 billion). If GDPR was passed and actually had teeth behind it, we thought it could be even bigger.
The co-founders Dimitri Sirota and Nimrod Vax, came from Computer Associates. Dimitri came via a sale of a company he co-founded called Layer 7 Tech and Nimrod as head product for Identity Management at CA. The first 9–12 months were spent building product and speaking with early adopter Fortune 500 corporates. In the early days, it was tough to get funding for BigID as no one really thought the market would take off. Fast forward to April 2018, and BigID won the Innovation Sandbox at RSA, the premiere security event and funding and customer traction came much easier. It is simply awesome to be a small part of a team who went after a market no one believed in, and now is a recognized leader in a super hot market which many believe to be huge. That is what I love the most about working so closely with founders at the formative stage of their business.
Jean: What is one piece of advice you would give a startup?
Whether you are an engineer, founder, or sales person, everyone should learn how to sell. Being a customer-driven organization is something many people talk about, but it’s important to imbue your culture with a deep understanding of why you are building something and who you are building it for, and how to pitch the value proposition and the company whether it be to new employees, partners, customers, or even your family. This is a skill everyone should have.
Jean: Do you have a favorite book that made a deep impact on your life? Can you share a story?
I’ve always loved the children’s book Harold and the Purple Crayon by Crockett Johnson. I loved how Harold, with just a purple crayon, could draw himself out of any situation. With that crayon, anything was possible and you were only limited by your imagination. That mantra and belief is still deeply ingrained in me today. I feel like the luckiest person as I still get to do that every day, which I is why I probably chose the first check path. Founders come in armed with their imagination and their technical superpowers and vision for what’s possible in the future, and I get to work with them to see this through.
Jean: What are your “5 Things I Wish Founders Knew Before They Pitched To Me” and why. Please share a story or example for each.
- The “why” you set out to start a company is just as important as the “what” you are building. We look for mission-driven founders with a unique technical breakthrough to solving problems. We love founders who start companies born out of pain vs. taking a white board and mapping out 6 different areas before choosing one. The ones who are passionate about what they do will be the ones that survive the inevitable hard times that come with being an entrepreneur.
- Get me fired up about what you are building — and why you are building it — in the first couple minutes, and make sure to be clear and succinct. We meet lots of founders during the day, so bringing the energy, passion and crystal clear story separates you from the others.
- Be your authentic self. We like confidence, but not arrogance. Just as much as we are listening to your story, we are also thinking about how you’ll be able to attract others to work with you and how our working relationship may be.
- If you don’t have an answer, I’d rather have you say I don’t know then to fake it. It’s ok, you are not expected to have all the answers, but I would hope you can follow up quickly and say, “this is how I’ll gather more information.”
- The goal is not to get the check on our first meeting, but to get me to the next meeting. I would also expect you to exercise due diligence on myself and Boldstart to make sure we’re a great fit.
Jean: Some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this.
I’d love to meet Warren Buffet. I always think about his quote, “If you can’t think clearly in Omaha, you’re not going to think clearly anyplace.” Starting in the VC world out of NYC in 1996 felt similar to me — wrong place and wrong time. But what I’ve prided myself on is the fact that there are benefits to not being in Silicon Valley. I’ve always admired Warren’s ability to use his location as a main advantage, to think on his own and consistently outperform his peers. Most importantly, he’s built his track record with confidence, ethics creativity, and humility.
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