Five and One-Half Questions
1 — Tell us about a moment or incident that “made” your career?
When I started out, I was a management consultant and an investment professional and financial manager — working in private equity, and as a hedge fund manager — on the east coast. But I gradually realized that I didn’t really have a strong passion for it. Then I moved to San Francisco — which was of course a completely new and foreign culture to me. Not just the people but the “startup culture” — started my journey into startups and investing.
I went and visited so many of these different angel groups and saw startups that were in social, local, mobile, not my thing at all: I wasn’t passionate about it.
And so I said, there has to be a different category of startups, right? One which I am interested in. And at that time I defined these as what is now called “deep tech” startup. I wrote an article about it on LinkedIn that became a very popular read. But the point was that I discovered my passion, which is really tech startup alone isn’t sufficient. It has to be leveraging breakthroughs and science breakthroughs and engineering and help change the trajectory of humankind. So for me, that discovery was important and I realized there wasn’t a single angel group that was focusing exclusively on this. So I started the MIT Angels at that point and then the rest is history, you know, and we focused our angels investments exclusively on deep tech startups.
2 — What business mistake do you wish you could “do over” ?
Oh, my God. I guess it would be — understanding the value of marketing. So, you know, when I started down this journey, now I have a background in investing as an investor and I’m very analytical. I got a master’s degree at the Engineering Systems Division, and then I did my MBA at Sloan. And yes, I like numbers a lot, best of all things — but I didn’t take any marketing courses at Sloan, believe it or not. Not one marketing course. Such a mistake. Such a mistake is especially because marketing today is extremely analytical. It’s extremely data driven, it’s extremely experiment driven. And if you don’t understand how to do these experiments, really, you need to be in a different business. I don’t know what business you should be in. Everyone needs to know marketing and everyone needs to know sales.
3 — What is the hardest part of your job, that most people might not guess?
The most intellectually stimulating thing is to meet new startups and learn about the new technologies, which opens new worlds for you. But and that was the passion that I started with, remember? But I have ended up doing a lot of the running of the company, whether it’s my own company, strategy operations, what have you. And I get not to meet these startups that I was passionate about.
The hardest part is I get to do (or have to do) all of the stuff that nobody else wants to do. So everything from legal, compliance, regulatory, that kind of things, you know, and not the actual meeting of the [startup] companies, which was the passion I started with, because there are other people who are interested in that. Nobody wants to look at legal documents. And then there’s the risk also, which I have to consider. So I yeah, the hard part is I don’t get to follow my passion, as you would imagine I’m doing. So basically the hardest part is in the the running of the company rather than the growing of the company, the operational part.
4 — If you weren’t in your current role, what career would you have?
[Laughs] Well, if they would hire me … I would probably go work for a hedge fund or maybe a day trading, maybe sports betting. They’re all the same. Sports betting in many ways is similar to a hedge fund. I mean, if you know nothing about the sport, all you’re doing is hedging your bet. It’s possible, if you know your numbers, that you can bet on various sports without losing money, assuming certain conditions are met. There’s a lot of ways to make money no matter who wins.
5 — What do you know now, that you wish you knew when starting out?
So as you know in my company [Propel(x)] is about is working with investors and startups. And the idea was that we want to make alternatives more broadly available to investors, and we have done that. The challenge that we have come up against is that I would say investor education is a decade long cycle, roughly. And we underestimated that. We underestimated how much investor education would be important.
So right now we are working with people who already kind of know this and who are already somewhat sophisticated to prepare. Propel(x) has a lot of sophisticated investors, but that really is at this time it is exclusively for sophisticated investors, I would say.
We’re working on this long tail of people who are mid-career or late career professionals who have stocks and bonds in their portfolio, want to diversify into alternatives, which should be a part of everyone’s portfolio, in my opinion, to be properly diversified. But that investor education cycle has taken off and we now are finding tremendous uptake, especially last year as we were discussing. Was a year of the alternatives. I would say 2021. And so since then, you know, things have suddenly picked up a lot.
But yeah. The lesson is that basically things take a lot longer, particularly when educating investors in a new type on investing.
…. And … the bonus question:
5 1/2 — You’re on Shark Tank — what do you say that gets all the sharks fighting to invest in your company?
Well, I’m not even sure that I want the sharks fighting over me and my company. But still, to answer your question, I think I would just show them the projected revenues. Show them that that’s what really matters, how you’re going to triple quadruple it in the next 3 to 5 years and the value of compound annual growth, you know, that the number is meaningful — annual growth, annual growth rate. So once your once your marketing actually starts going. You grow very rapidly or you have the potential to grow. The value of compounded compounded returns
And that is what we are seeing, you know.
[With regard to Propel(x), I asked, on behalf of Shark Tank, how do you compete with these multi billion dollar funds who are able to “spray and pray” — by putting $5m into 100 different companies. Swati’s answer? “That’s easy — We make Money.”]
For more 5–1/2 Questions Interviews, see:
He is the author of the bestselling “The Age of Metapreneurship — A Journey into the Future of Entrepreneurship.”
And the upcoming “The Startup Brain Trust — A Guidebook for Startups, Entrepreneurs, and the Mentors that Help them Become Great.”
Follow him @cjcornell or visit: www.cjcornell.com