Naval Ravikant on China Money into Silicon Valley: This Trickle Could Become a Tsunami

Screen Shot 2016-08-25 at 10.08.31 AMAngelList, the online platform that matches startups with early-stage investors, has grown by leaps and bounds since its 2010 founding — and so have its ambitions. In fact, the company, which already bills itself as both the biggest seed-stage firm in the world, and the world’s largest hiring platform for startups, also aims to become the biggest venture fund in the world.

Earlier this week, we sat down with cofounder Naval Ravikant at the firm’s swanky new, three-story digs in San Francisco’s Jackson Square, and as workmen shifted planks around the nearly completed ground-floor level, Ravikant caught us up to speed on a many aspects of what’s happening at AngelList.

We’ll have more on his overarching vision tomorrow. Today, we’re publishing a part of our conversation that centered one of the biggest drivers of AngelList’s current growth: the $400 million that CSC Group — one of the biggest private equity funds in China — committed to invest through AngelList roughly 10 months ago. (The WSJ billed it as the “largest single pool of funds devoted to early-stage startups—ever.”)

Ravikant shared how that relationship is evolving, and why he thinks CSC’s money is just the tip of the iceberg for both AngelList and Silicon Valley more broadly. Our chat has been edited for length and clarity.

TC: Let’s start at the beginning. Who is managing this $400 million from CSC?

NR: It’s a fund called CSC Upshot that’s managed by CSC’s Veronica Wu, who used to be a VP at Tesla Motors in Beijing; Ming Yeh, who’d spent the previous six years or so as a managing director at [Silicon Valley Bank] in Shanghai; and Tom Cole, a former partner at Trinity Ventures.

TC: How much have they invested in startups on AngelList so far?

NR: They’re on track to invest between $25 million and $40 million this year, with an average check size of $100,000.

TC: Wow, that’s quite a pace. How does the decision-making process work?

NR: We’ve built a dashboard for fund management, and all these managers [have signed nondisclosure agreements] so they get to see literally hundreds and hundreds of deals on AngelList. And they chat with each other and [with the lead investor’s approval], if enough people vote yes, the deal gets done.

Much more here.

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