Resilient Start-Up’s — 2021 and beyond. VC Bootcamp Session: how the impact of COVID will resonate on the VC world for the next 3 years.
Me2We 2021 Nex2Us — Connecting LEADers to accelerate positive impact
March 9, 2021.
Me2We is a special 3-day annual event, volunteer driven, organized by and for alumni and participants from the Stanford Graduate School of Business LEAD program.
Stanford GSB supports the event and its management closely works with the organizing committee to plan and facilitate it. The event brings together a variety of thought leaders including renowned Stanford GSB faculty, key industry leaders, researchers, authors and artists.
Stanford LEAD is a year-long, fully online executive program from the Stanford Graduate School of Business.
LEAD is designed for mid to senior level professionals who are looking to become principled and purposeful leaders of positive change in their organizations, industries, and the world. The program enrolls cohorts of executives from diverse personal and professional backgrounds, and to date has enrolled over 2,400 participants from 30+ industries and 95+ countries.
We are pleased to present this VC Bootcamp session where we will provide fascinating insights into the Start-ups landscape from their own perspectives.
Hosni Zaouali is the President of the Ontario Cooperation Council. Hoss co-founded Me2We in 2015 and the Silicon Valley VC-BootCamp in 2018. The VC Boot Camp’s mission is to build bridges between ecosystems around the world. Hoss wanted to help LEADers and executives turn good ideas into great businesses. Hoss also created Tech-AdaptiKa, providing avatar-based virtual campuses to corporations and universities around the world. He will be talking about how the impact of COVID will resonate on the VC world for the next 3 years.
During this session, Hoss will be discussing with two special investor guest speakers: Gary Fowler: “The AI Guy who creates Unicorns”, CEO, President and Co-Founder of GSD Venture Studios,- TedX Speaker, ForbesBooks Speaker and Sergio Letelier: Vice President — Corporate, Securities and M&A at Hewlett Packard Enterprise.
How the VC landscape has evolved from 2019 to 2021 and how are start-ups are being considered by VC’s?
Gary Fowler: We used to have 1:1 meetings or launches at restaurants talking with folks about how deals could have been done; now we can connect in entirely different ways. What I have seen changed ? I have seen open minds and — equally — an intellectual capacity evenly spread all over the world.
I have seen everywhere incredible start-ups that are revenue producing: opportunities can spread today more evenly everywhere and not only in the USA and Silicon Valley.
We have 17 companies in our portfolio today — some of which in Africa — like Rwanda, South Africa, Nigeria — or Argentina. You have to go outside of the box and the VCs that are really proactive and value these types of opportunities are those who are going to win.
Sergio Letelier: This crisis was a reminder that cash is king if you think of VCs and M&A like parts of the same ecosystem — where the M&A is the exit.
People are extremely cautious about where and how to invest. The overall uncertainty regarding the length and the effects of the pandemic has freezed M&As. VCs environment has less deals, there are less exit opportunities, money managers are more worried about what to do with their cash.
In my view, this has created three categories of players:
- First category of players comprises those VCs fighting for their lives —where M&As are not reaching the next financing round;
- In the middle there are those who have access to capital markets but do not have enough cash to take advantage of the situation. They make strategic deals being very cautious;
- The true winners are those having a lot of cash capacity — taking a leap and making a true runaway. I am less optimistic than Gary. I see a lot of caution notably when it comes to valuations.
When it comes to price negotiation it is difficult to put the right price on the right opportunity. The pandemic has made the landscape more uncertain.
We as HP Enterprise are in that mid category, we had access to money and capital markets and have built capacity, but we have been very selective in our investments. There is a focus on the impact — scale matters. You will see players like us choosing larger deals where the scale has a direct impact on the financials. Companies like us are looking for larger size transactions, fewer transactions and at the right value.
Digital transformation has been propelled within a decade — if not a century during this pandemic. What we are trying to do is to determine what will stick; invest and build the capabilities, the technologies and the brains that will remain and get digitally transformed.
What advice do you have for start-ups in 2021 and what do they have to demonstrate?
Gary Fowler: Start-ups that want to survive need to think about how to look at data not only with smart but also intelligent systems. Cash is king , having revenues, showing that you have product-market fit that you have validated your hypothesis — that you have a model
- Intergenerational teams;
- Cultural diversity — people with different input and ideas that make a product successful
- Decentralization — to make your work done wherever you find the right resources to get the job done at the right price and time.
There are very simple dynamics to progress further and it is really important to convey your message.
Sergio Letelier: It is time to be bold — start-ups taking advantage to run the experiment in this phase and show how great their products can be are going to be the winner
More info on LISA — GSB-LEAD-LISA
Contributed by:
Martina Nicodemo, Deepti Pawha
Read other stories from LISA session at Me2We 2021 Nex2Us Stanford LEAD event :
Resilient Start-Ups — 2021 and beyond: How to include storytelling to reach the right audience
Resilient Start-Up’s — 2021 and beyond: Investing in resilience
Resilient Start-Up’s — 2021 and beyond: Resilient Start-ups from LISA — Mexicrowd success story
