It takes risk. That’s one way Doug Leone, managing partner at Sequoia Capital describes his path to success in a room of wide-eyed students at Stanford’s Graduate School of Business. He mentions he has no special talents, but his recipe for success in venture capitalism is a combination of luck, hustle and risk.
Risk without strategy is ill-advised, but is certainly what it takes to stay afloat in the competitive startup landscape. Leone shares his perspective on this and gives brief insight into his life circumstances.
He emigrated from Italy to the United States at 11 years old. He survived the hustle and bustle culture of New York City and had his start working blue-collar jobs. But, he was always hungry. Hungry for more opportunities and had a passion for business.
His first job was as a salesman at Sun Microsystems on N. and 96th Street. He sold computers and came across a young charismatic student at Columbia who told him about the Arpanet and the world of venture capital. Although, Leone did not know what he was talking about at the time, he knew he wanted to do that for a living.
Little did he know that such tremendous luck would pay off, and that he would be working with founders or be a managing partner at Sequoia Capital.
Response to Risk
Sequoia loves it. Leone explains that many companies do not respond to risk in the same way. Most businesses point of view on risk-taking is to keep it at a minimum and avoid it at all costs. Leone rebuts against this perspective by pointing out that some level of risk taking is actually good. It keeps you competitive, relevant and a successful leader.
What is Sequoia Looking For?
Intelligent investors, top-tier engineers and women. One thing Leone deeply resents is the lack of representation of women investors. Female investors exist in overseas company branches like India and China, but not the US.
Leone mentions that this is a huge failure and Sequoia is doing everything it can to change this dynamic, but is still searching for qualified candidates.
Another thing Sequoia looks for is quality pitches from founders hoping to be potential investors.
Some of the key things Leone mentions Sequoia looks for in these candidates is preparation, lots of knowledge about their particular domain, product or service, having a desire to solve problems with their business and are working on ways to improve them, ability to learn from mistakes and demonstrated risk taking.
He says things are nutty in the private market. Also, a company and or product has “life cycles.” The closer a business reaches $1 billion, the closer it is to reaching the top of the cycle.
Secret to Success
Think like a salesman. You have to hustle, work hard and play hard. Leone notes somewhere along the way, he got lucky. Through his hard work and achievements, he got recognized and moved up the corporate ladder.
He says you have to be fearless, able to take risks and “bring it everyday.” That is what helped him in his journey and will help those starting their professional lives.
Lastly, every business or tech startup needs to find at least 2 to 3 engineers that are really good. The more quality talent you start your business with, the more talent it can generate according to Leone. If you don’t do this and hire weak talent, the business will not be a success and neither will you.