What is your company’s main product or service?

We work with “Venture Capital”, which means that we professionally manage other people’s money and make investment decisions in promising technology, typically at an early stage.  Ideally a product has been developed with some indication of market interest, but maturity within the organization has not yet been developed.  It’s similar to Dragon’s Den, or Shark Tank, but we get involved earlier in the companies’ development.  We deal with entrepreneurs who have developed anything from an idea through to a product.  Ours is a small company – right now we have seven staff.

What do you do as a Senior Investment Manager?

I get out and about in the community, trying to find investible ideas and doing the due diligence on opportunities.  If something looks interesting it becomes a conversation: convince me why I should do this investment, followed by more in depth diligence on the technology team, market, financial forecast, etc, trying to find reasons why we should not do the deal.  Then comes negotiation, and post-investment – working with the company long term, say five to ten years until the company gets acquired or some other attractive exit presents itself.

The due diligence process takes many months – you can’t really get to know people in a short amount of time.  They’ll tell you “this is what we’ve done, and over the next few months this is what we expect to do.”  All right, you’ve caught my interest, now come back in a month or two when you’ve accomplished some of this, and let’s talk more then.  And that’s talking not only about if the outcome was achieved, but what was learned along the way.

Why this field?  Why this job?

It’s fascinating.  I get to work with a lot of smart, creative, driven, motivated people.  A good entrepreneur is one who wants to change the world, to do something that’s unique and different, and who has a pile of creative ideas.  Almost inevitably the initial product idea is not where the opportunity is, and the entrepreneur needs to be creative and flexible in order to adapt to the realities of the market – they need to be able to say “I want to let this baby go and work on another idea because I’ve had another 100 ideas since we’ve started”.

I’ve found that given the early stage of the companies we’re dealing with, there’s no single predictor of success.  Could be great technology, could be a great product, but maybe the market just isn’t ready yet, or the price point is wrong, or– lots of different reasons, internal and external, so in the end if anybody says they can guarantee success, well, they’re probably wrong.  But almost invariably a predictor of a failure outcome comes down to the people, and human behaviour truly is fascinating.

To do this job you need to understand how people think and behave, so that when they’re selling their product to you at 100%, or 110%, you know when to push back a bit and say “I don’t believe this”, or “convince me of that” – you need to be able to provide a skeptical response.  And all the way through those conversations I’m trying to profile how the individuals are going to behave when they end up in a difficult business or personal situation.  These situations are inevitable, and if we choose to work with a given company we’ll be working with them for five to ten years!  There will inevitably be cycles.  How they will behave in those periods is absolutely critical.

Mature entrepreneurs will listen.  They won’t be dogmatic – they’ll say “huh, interesting, I hadn’t thought about it that way; let me work with that”, or “I disagree but let me think about it”, and then they’ll come back a few days later and say “you know, I checked into that; here’s what I’m thinking – what do you think?”.  Listening, adapting, debating… when you become convinced you go down the path – ok!  But until then you have to listen.

How did you end up in a job with such a psychological slant after starting out in Engineering?

Engineering is about the “how” of problems, and I found I was more specifically interested in the “why”.  So I followed up my Engineering degree with an MBA a few years later, since business was more about answering the “why”.  Who’s going to buy – why?  What’s the problem you’re trying to solve; why is that a problem.  This brings human psychology and human behaviour into consideration, and I’ve always had an interest in that.  But before starting on this path I had no context for how important it is.  Beyond the MBA I’ve mostly developed this side of my skill set through intuition, and a lot of reading.

What’s the biggest thing that tests your patience in your job?

With the entrepreneurs… being too rigid in their thinking.  Being convinced that they’re right, instead of seeking to learn and modify their views as they gather more information.  I still learn something from pretty much everyone that I come across, and I can share a lot of that if the other people are willing to listen and question.  But if they’re rigid in their thinking and rigid in how they’re doing things, my experience says that’s going to be a problem, and that’s the kind of person I would not invest in.

Finally, what advice would you have for a new engineering starting off in the world of work?

That’s a hard one to answer, because what’s right for one individual could be wrong for someone else.  There’s fun things about a big company, and a whole set of things that one can learn.  But there’s a whole set of other things you can learn and get frustrated by and have fun with in a small company!

Putting other factors aside, I would encourage people to think about whether they want to work in an environment that’s more structured and disciplined, and where their scope of responsibility is narrow and deep, which would lend towards a larger organization.  Things are more structured, with processes in pace, since the organization needs that in order to function.  The things you learn in a small company are being scrappy and quick and nimble, and making do with less than what you might want to.  You get exposure to a whole lot more at a horizontal level across the organization, just because it’s a small group.  It’s great for some people, but the unstructured chaos of a startup is not for everyone.

Remember that you’ll probably have multiple jobs, multiple careers almost, and don’t assume that where you start is where you’re going to end.  So follow what is of interest, be open-minded to listening and learning, and be ready to move on when you feel like you’re not learning enough or when you want to learn some different things.  There is no right answer.

I’m approaching 50 and I got into this job about six years ago, and it was a bit of luck that got me into this job.  I wouldn’t have chosen it myself, as I didn’t have an understanding of what the actual job entailed, given my work history in large wireless and telecom companies.  But it’s been good for me.  It’s tying together a bunch of things about my character and education and work experience.  But I didn’t know when I started out that this is where my career would take me.  Every job, every experience, every person you cross paths with – they have something to teach you.

If you’ve come here with the answer to the puzzle published in the September Mecha newsletter, post your solution and how you found it as a comment below.  The first person to post the correct method will recieve a prize!