• Ajay Chopra of Trinity Ventures: Mine Your Portfolios

    ajay_chopra_bw_4550Like a lot of venture capitalists, General Partner Ajay Chopra of Trinity Ventures has a number of ways to “turn down the noise” of a clamorous startup ecosystem without, hopefully, tuning out the next billion-dollar opportunity.

    Chopra — who joined Trinity in 2006 after selling the company he’d cofounded, Pinnacle Systems, to Avid Technology for roughly $460 million— talked with me yesterday about some of the tactics he uses.

    You recently wrote about why it’s important to turn down entrepreneurs the right way. Why spell it out?

    The point was that because we turn down 99 percent of the people we meet, it makes sense to be prompt about [a no] — which many VCs are guilty of not doing — give them feedback, and be helpful to them by just pointing them in a couple of right directions. It doesn’t take that long and it really does leave a lasting impression.

    How much effort can you put into the process, practically speaking?

    Well, first, I think the VC business is about how do you separate the signal from the noise. VCs do it in a variety of ways. For example, if I’m only investing in digital media, I’m not looking at clean tech or healthcare deals. If I’m only looking at Series A and B deals, I’m not looking at growth-stage companies. Even still, you could spend a lot of time focusing on the wrong things, so we focus a lot of building relationships, including mining our portfolio.

    Meaning what, exactly?

    We talk to employees at the VP level, the director level, even the product manager level while [they’re employed by a startup we’re backing]. We get to know the management teams and we ask, “Who are your best guys?” because we want them to have a relationship with us.

    That doesn’t threaten your CEOs?

    Not if you do it with the CEOs’ consent. I think most CEOs who are confident company builders don’t have any issues with it. Companies with hidden agendas from their board members might, but then they usually have other issues to worry about.

    I do think it’s good for product managers to be meeting with venture capitalists. And I think it’s a good retention tool for CEOs. In fact, I often get an invitation from a CEO, saying, “Hey, this person did a great job. Can you reach out to them or have coffee with them or send them an email?” Everyone knows there’s a board, and there’s a light level of touch whether you like it or not. The best CEOs use it to their advantage and to benefit their employees.

    Do you take product managers out for lunch? How does it work?

    We invite people in specific areas to events, like marketing people or product management people or infrastructure people or VPs of operations — people who are sometimes underserved and not recognized. We have a speaker usually, and we let the CEOs pick three top people to [send to one of these events to] award them. Recently, for example, we had [Zulily founder] Mark Vadon talk with a group about his background and career development and how to handle conflict. Hopefully, it left a subliminal impression about Trinity, so that three or five or six years from now, when these employees’ current ventures have proven successful and they’re ready to step out, they’ll think, “Let’s call Ajay; I feel comfortable with him.”

    Interesting that you think these employees might themselves become founders. So you don’t subscribe to the theory that entrepreneurs are born, not made?

    Not at all. Entrepreneurship isn’t about being able to hack or code or build the best [user interface] as a teenager. It’s about passion and the determination to fulfill a vision. The overwhelming indicator of the best entrepreneurs is that they’re passionate and driven by the idea that they’re chasing. I might hate the idea. I might think it’s crazy. I’ll tell someone that, too. But if they say they’re going to chase it anyway, that they aren’t going to give up, well, that’s a good entrepreneur.

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