Latest / Lab to Market Leadership with Chris Reichhelm / Funding the Semiconductor Future | Kevin Chen

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Funding the Semiconductor Future | Kevin Chen · Lab to Market Leadership with Chris Reichhelm

0:00
Kevin Chen: To be successful in the lab to market journey is not just about making sure the technology works.
0:06
Kevin Chen: It's about all the other things, raising money, hiring people, managing a board, bringing on advisors, working with difficult customers, getting purchase orders, firing people that may not be a great fit.
0:21
Kevin Chen: All of those things are people related.
0:24
Kevin Chen: Uh, and uh, yes, it's, it's based on the technology that I'm bringing, but ultimately, um, it's more than just the technology itself.
0:33
Chris Reichhelm: Welcome to the Lab to Market Leadership podcast.
0:37
Chris Reichhelm: Too many advanced science and engineering companies fail to deliver their innovations from the lab to the market.
0:43
Chris Reichhelm: We're on a mission to change that.
0:45
Chris Reichhelm: My name is Chris Reichhelm, and I'm the founder and CEO of Deep Tech Leaders.
0:50
Chris Reichhelm: Each week we speak with some of the world's leading entrepreneurs, investors, corporates, and policy makers.
0:56
Chris Reichhelm: about what it takes to succeed on the lab to market journey.
1:01
Chris Reichhelm: Join us.
1:01
Chris Reichhelm: For those of you in the world of semiconductors, particularly if you're an entrepreneur or a CEO looking to fundraise for your semiconductor or semiconductor materials company, or if you're in that domain, you need to listen to this week's podcast.
1:18
Chris Reichhelm: I am talking to Mr.
1:19
Chris Reichhelm: Deep Tech himself, Kevin Chen.
1:22
Chris Reichhelm: Now, Kevin is the managing director of Lam Capital.
1:28
Chris Reichhelm: Lam Capital is the Corporate Venture Capital Unit for Lam Research.
1:32
Chris Reichhelm: Lam Research being the 100 billion market cap semiconductor materials and manufacturing equipment company.
1:39
Chris Reichhelm: Uh, and, uh, and Kevin looks after their investments.
1:42
Chris Reichhelm: He's responsible for making strategic investments.
1:45
Chris Reichhelm: Young, promising, uh, startup companies within the semiconductor and materials domain.
1:51
Chris Reichhelm: And, uh, I'm super interested to speak to Kevin.
1:53
Chris Reichhelm: 'cause not only is he a great investor, uh, he has got the most, uh, well, the most incredible background.
2:01
Chris Reichhelm: And I call him Mr.
2:02
Chris Reichhelm: Deep Tech because this guy, you know, he ticks all the boxes.
2:06
Chris Reichhelm: He's got the PhD from MIT, he's been a founder or co founder of at least a couple of startups within the photonics, hardware, semiconductors, value chains.
2:16
Chris Reichhelm: He's been an executive at Applied Materials.
2:19
Chris Reichhelm: Uh, he's been a CEO, he's actually jumped domain and been a CEO of an Agritech startup as well.
2:26
Chris Reichhelm: And now of course he's an investor.
2:29
Chris Reichhelm: And so I want to understand from Kevin how he manages to take all of this great experience he's gathered and apply that to making better investment decisions on behalf of Lamb Capital.
2:41
Chris Reichhelm: I also want to talk with him about the advice.
2:44
Chris Reichhelm: that he has for entrepreneurs and executives looking to fundraise.
2:48
Chris Reichhelm: Fundraising is pretty tough right now and I'd love to hear Kevin's view on the things that he's looking for when it comes to raising.
2:59
Chris Reichhelm: Um, uh, I'd also like to get his insight into Uh, boards and board performance.
3:05
Chris Reichhelm: If there's one thing I've heard again and again, uh, it's the, it's the mixed quality of boards of directors and their general performance.
3:15
Chris Reichhelm: How can we get boards to perform better?
3:18
Chris Reichhelm: Kevin has sat as the CEO and founder of these.
3:21
Chris Reichhelm: He's been a non executive on these, which he is today.
3:24
Chris Reichhelm: He's an investor on a number of boards.
3:25
Chris Reichhelm: What is his view on improving board performance?
3:30
Chris Reichhelm: This is going to be a really interesting conversation.
3:32
Chris Reichhelm: Let's see where it goes.
3:33
Chris Reichhelm: I hope you enjoy it.
3:35
Chris Reichhelm: Let's get into it.
3:40
Chris Reichhelm: Kevin Chen, thank you so much for joining me.
3:43
Kevin Chen: Thanks, Chris.
3:44
Kevin Chen: Great to be here.
3:46
Chris Reichhelm: You are Mr.
3:47
Chris Reichhelm: Deep Tech.
3:48
Chris Reichhelm: If anyone looks at your profile and they see the PhD from MIT, they see the early background in semiconductors with groups like Intel, uh, the background to startups, the photonic space and the advanced materials space, the experience with applied materials, the, and then, and then the change over to AgChem as well, to AgTech, and now with Lam Capital, Lam Research, uh, back with Materials and Semiconductors, so, you know, the journey that you've been on from startup to corporate to investor, uh, all within these deep tech sectors is quite, is quite unique for an individual.
4:39
Chris Reichhelm: Do you find you naturally gravitate towards one area more than the others?
4:45
Kevin Chen: I think the underlying.
4:48
Kevin Chen: Theme for me has been being around new technologies.
4:53
Kevin Chen: That's probably the most basic, uh, common denominator over, over all of those.
4:59
Kevin Chen: And then a curiosity, uh, to, to learn about different technical areas.
5:04
Kevin Chen: Again, looking back, I, I realize now that really, I think my, my, uh, career DNA or my, my interest in technology really started at a very young age.
5:17
Kevin Chen: early point where I just like, um, understanding different aspects of, of technology.
5:24
Kevin Chen: Um, Is that true today?
5:25
Chris Reichhelm: Is that still the hook?
5:27
Kevin Chen: That is still the hook today.
5:29
Kevin Chen: Yes.
5:30
Kevin Chen: Yes.
5:30
Kevin Chen: And so, so if I fast forward to what I'm doing now, which is that I lead the, uh, CVC, Corporate Venture Capital Group of Lam Research, a very large semiconductor equipment company, We have the wonderful opportunity to talk to deep tech entrepreneurs across the spectrum.
5:48
Kevin Chen: And it's a, for me personally, it's a, it's a wonderful match of my interest in various technologies and Now, some years later, having all the operational and entrepreneurial background that I've gained through my career, being able to offer that to our entrepreneurs as well.
6:05
Kevin Chen: So, it's, it's, it's the, it's the ultimate combination of personal interest and also professional experience.
6:13
Chris Reichhelm: I get that.
6:13
Kevin Chen: It's wonderful.
6:15
Chris Reichhelm: Fantastic.
6:17
Chris Reichhelm: Tell us a little bit about Lam Research's focus from a corporate venture perspective.
6:24
Kevin Chen: Yes, so, um, Lam, Lam Research as a company is a, you know, we provide manufacturing solutions for chipmakers.
6:34
Kevin Chen: We provide the machines and the processes that, uh, chipmakers need.
6:38
Kevin Chen: need in order to produce the devices that we all use today.
6:42
Kevin Chen: So from a, from a CVC perspective, we are looking for companies that can further the roadmap of the chip industry.
6:51
Kevin Chen: And can enhance some of the things that we're looking to do within, uh, Lam, Lam research.
6:58
Kevin Chen: So, some of the areas we look at include, uh, uh, you know, photonics, which I alluded to earlier.
7:04
Kevin Chen: Uh, there's some, um, now a trend to integrating optical functions with, uh, semiconducting or, or, uh, electrical functions.
7:13
Kevin Chen: We're looking at, of course, the chip industry itself, whether it be new memory technologies or new, uh, artificial intelligence, uh, computational, uh, technologies.
7:23
Kevin Chen: And then, um, you know, things along the, the semiconductor value chain, starting from the, uh, incoming materials, uh, the substrates through to the manufacturing of chips through the, uh, backend, uh, processing of chips, the packaging of it, of them into Multi chip packages, for example, and then the use cases of new chips.
7:45
Kevin Chen: Um, so we, we cover that whole spectrum and I would say we also look at adjacent areas, which include robotics.
7:52
Kevin Chen: There's a lot of, uh, automation that's happening, not only in the chip industry, but in adjacent industries.
7:57
Kevin Chen: We look at, uh, uh, uh, automation technologies.
8:01
Kevin Chen: We're looking at some software technologies as well as other related manufacturing technologies, including additive manufacturing or 3D printing.
8:08
Kevin Chen: So that, that's, uh, that's, it's a wide spectrum.
8:11
Kevin Chen: It's a, it's quite a few different topical areas.
8:14
Kevin Chen: And, again, that's what makes, that's what makes the role so interesting, uh, to be able to explore, uh, all these, all these areas.
8:21
Chris Reichhelm: Well, it's a big diverse area, and it sounds like you're extending the reach, the core, you know, the reach from the core activity into some of these areas that are further downstream.
8:31
Chris Reichhelm: But that probably offer a lot of value as well.
8:34
Chris Reichhelm: The, um, how big is your team?
8:37
Kevin Chen: The team is fairly small.
8:39
Kevin Chen: The direct team is, uh, about four people.
8:43
Kevin Chen: And by the way, we are recruiting right now.
8:45
Kevin Chen: We're about to bring in two more.
8:48
Kevin Chen: So we'll get to about six or so.
8:50
Kevin Chen: Uh, but we work with an extended team.
8:52
Kevin Chen: So included in that, we don't include uh, supporting Aspects such as legal and finance, that that's, that's with the, the, the parent company.
9:01
Kevin Chen: Um, but the core team is fairly small.
9:03
Kevin Chen: And, and I'll say one thing about the team itself.
9:06
Kevin Chen: Um, we've been privileged to be able to build a team that consists of former entrepreneurs and um, um, folks with deep technical backgrounds.
9:16
Kevin Chen: And so I think from a value add perspective, uh, having been an entrepreneur myself in the ag, ag tech industry, as you, as you alluded to in the opening.
9:26
Kevin Chen: Um, one of the things that I really appreciate about investors and, and future board members is if they've kind of walked through my shoes, have, have they done this before?
9:35
Kevin Chen: Do they understand what we as entrepreneurs are going through?
9:38
Kevin Chen: And so when we bring on folks into the team, we definitely look for folks who have been steeped in the entrepreneurial world, either as a former investor or preferably also as a former entrepreneur.
9:51
Kevin Chen: So, so that's what our team consists of
9:55
Chris Reichhelm: That, that previous operational experience, especially for investors, is so valuable.
10:03
Chris Reichhelm: Um, it sounds obvious.
10:05
Chris Reichhelm: Uh, we still, we still don't see it quite enough, I think, in the UK and Europe.
10:09
Chris Reichhelm: In the US, it's far more common, but the value it brings for young entrepreneurs is, is immense, I think.
10:18
Chris Reichhelm: The, you know, the, your experience has, you know, Included startups and other corporates as well.
10:27
Chris Reichhelm: The, which is really interesting when you're trying to take a startup from lab to market, because you're going to be engaging obviously in a, in a, in startup activity, but you're going to be engaging with industrial partners and corporates along that journey.
10:45
Chris Reichhelm: And so are you able to, that must make, you know, that must give you some incredibly valuable perspectives.
10:56
Chris Reichhelm: When you're advising entrepreneurs along that journey?
11:00
Kevin Chen: Mm hmm.
11:01
Kevin Chen: Yes.
11:02
Kevin Chen: Um, I think, uh, that definitely, for sure.
11:07
Kevin Chen: I think for a, for an entrepreneur trying to validate their idea, and in this case, a deep tech related idea.
11:19
Kevin Chen: I think there's a couple aspects that, that they need to go through.
11:22
Kevin Chen: And one of the big challenges is getting validation from the market that what I'm working on is really what the market needs.
11:31
Kevin Chen: Let alone, let's set aside, can we actually achieve this technically?
11:36
Kevin Chen: Because it's a, it's a deep tech problem.
11:38
Kevin Chen: And so I think there's no better place to get that validation than to work with companies who are in the space.
11:46
Kevin Chen: And that, that's, you know, it's, it's, it's, it's obvious.
11:49
Kevin Chen: But I think it's also challenging, um, having worked at companies like Applied Materials and AMD in the past, large companies like that, um, sometimes it's, it's tricky to get, you know, the attention of the right people within a large company to, uh, divert their attention from what they're currently working on to talking to a very small company that may not have a product yet.
12:14
Kevin Chen: And so I think there's definitely an art to, as an entrepreneur, to get the attention of a large company.
12:22
Kevin Chen: or a potential customer.
12:23
Kevin Chen: It could be a small company, but an important, special customer.
12:26
Kevin Chen: Get their attention, and then walk them through a process of understanding what I offer, and also, more importantly, I think, getting feedback as to what the pain point is that the company is facing, or your potential customer is facing.
12:44
Kevin Chen: That whole process is critical for, uh, entrepreneurs, um, and so, yes, for sure, I think, first, having, having gone through that myself and our team, as I mentioned, uh, uh, you know, uh, former entrepreneurs, having gone through that themselves, um, for Hopefully, we can bring, um, some knowledge to the portfolio companies that, that we work with in that respect.
13:08
Chris Reichhelm: When you've seen it done well, or when you've heard about it being done well, what's been the hook that manages to capture the attention of the corporate?
13:20
Chris Reichhelm: And who's, who's leading this exercise?
13:25
Kevin Chen: Great questions.
13:26
Kevin Chen: Well, when done well Um, there is kind of this resonance that, that happens.
13:34
Kevin Chen: I think as an entrepreneur, we're, we're trying out different messages, trying out different lines of attack, different ways to market ourselves, our company, our products.
13:43
Kevin Chen: But when it really clicks, you can feel it.
13:47
Kevin Chen: And so, um, I'll give an example.
13:50
Kevin Chen: We have a interesting water technology company that we have recently invested in, in the US, which, uh, helps companies like us and other companies deal with harsh wastewater treatment.
14:03
Kevin Chen: And this is a new area for me.
14:05
Kevin Chen: I didn't know much about it before, uh, studying this area.
14:08
Kevin Chen: But one of the challenges that large companies have is how do you handle toxic wastewater?
14:15
Kevin Chen: And oftentimes, it's something that is outsourced to a third party.
14:20
Kevin Chen: And we've learned that in some cases, the wastewater is treated on site.
14:25
Kevin Chen: Uh, in other cases, it's Loaded into trucks by the third party and then trucked off site for treatment at the third party's location.
14:36
Kevin Chen: Whether it's the first or the second, it's a huge cost, and in particular for the second, uh, uh, route, which is that the wastewater is removed by the third party and trucked off site, there's tremendous, uh, emissions that are created from the trucking process itself.
14:53
Kevin Chen: And so, the problem statement for that particular problem is not necessarily that we need to treat the wastewater.
15:01
Kevin Chen: It's that, in some cases, we need to reduce emissions.
15:05
Kevin Chen: We need to reduce secondary emissions, not caused by our company, but they'd be brought on by the suppliers that we use, in this case, the trucking company.
15:13
Kevin Chen: So, if that is the actual problem, then how do we reduce emissions?
15:18
Kevin Chen: Get rid of that problem.
15:19
Kevin Chen: And so, what this technology from this water company is, is the ability to treat harsh wastewater on site with a new ceramic based membrane that doesn't dissolve in harsh wastewater and it enables companies like us to do on site treatment.
15:41
Kevin Chen: Which then removes that need for trucking and thereby removes the emissions problem and additionally gives us a benefit in that we can show that in our sustainability objectives.
15:58
Kevin Chen: And so, the actual resonance there was discovering what the actual core problem was among companies like us and other industrial companies and then being able to target that problem with the solution.
16:11
Kevin Chen: Now, the solution itself is obviously very elegant.
16:14
Kevin Chen: It uses an existing known ceramic material that's been around for decades.
16:22
Kevin Chen: We find it in desiccants in food packages, so it's very safe and it's well known.
16:27
Kevin Chen: But the approach is how do you take that ceramic and make it into a usable membrane for this particular application?
16:35
Kevin Chen: And that's where the innovation has come in.
16:38
Kevin Chen: And, um, I think that's one thing and then the other thing that this entrepreneur was able to do was tell the story very effectively to companies such as us in terms of what problem am I actually helping you to solve.
16:50
Kevin Chen: And, um, uh, and, um, really getting to the root issue.
16:56
Kevin Chen: Uh, so, uh, to your, to the second point, sorry, I was just going to hit on the second part of your question, which was, you know, who, who does this and who's responsible for it?
17:07
Kevin Chen: Um, and, and I think I'm a strong believer that the entrepreneur themselves, the founder or the CEO should be out there speaking with customers and being the first salesperson for the company before they bring in, you a dedicated salesperson at the right time.
17:25
Kevin Chen: So in that, in this particular example, the salesperson has been and still is the founder and CEO.
17:33
Kevin Chen: And I think that's hugely important because you gather direct feedback from your customers, and then that can be integrated into the company's plans and adjustments can be made.
17:42
Kevin Chen: And then on the customer side, There is a customer discovery process as well.
17:48
Kevin Chen: Is it the water management people?
17:50
Kevin Chen: Or is it the sustainability people that we need to be talking to?
17:53
Kevin Chen: And sometimes it's both.
17:54
Kevin Chen: And so, in this particular example, this entrepreneur did a wonderful job describing what the problem was, And then finding the right stakeholders within our company to, to get this, uh, technology, uh, installed.
18:07
Chris Reichhelm: And do you know if that entrepreneur had a, had a domain background?
18:11
Chris Reichhelm: Sorry, had a domain relevant background?
18:14
Chris Reichhelm: So did this person In this particular case And the water industry?
18:19
Kevin Chen: This person, uh, uh, has commercialized the technology he worked on during his PhD and spun it out of that work to form this company.
18:30
Kevin Chen: Um, and I think he has, he gained knowledge in the water industry just by, uh, you know, diligent study of the industry, speaking with companies and talking to, uh, advisors, attending conferences and just absorbing, absorbing it by osmosis.
18:49
Kevin Chen: Uh, sorry for the pun, but, but essentially that's what he did.
18:54
Kevin Chen: Um, and so at, uh, so I think that's, that's a prime example of, of how a, a, a lab based technology has made it into the market and is making a transition from being a research project into being a commercial entity.
19:11
Chris Reichhelm: What are the mistakes that you, that you observe now as an investor?
19:17
Chris Reichhelm: Being able to advise, uh, and work with a number of different companies, no doubt you see presentations from even more companies.
19:25
Chris Reichhelm: that you're evaluating, what are some of the things that you see again and again that, that, that aren't right or that aren't as they should be if, uh, if the entrepreneurs, uh, or executives have a hope of, of, uh, of raising?
19:44
Kevin Chen: Well, there's a few things, but, um, so I think depending on the stage of company that comes in, I see different aspects.
19:58
Kevin Chen: And I do have to preface this by saying, there are diamonds in the rough.
20:02
Kevin Chen: And so, even if something doesn't look quite right, it could be a, end up being a great company with a little bit of coaching and maybe some different personnel and things like that.
20:10
Kevin Chen: But if I were to just take things at face value coming in, what I noticed a lot in the world that we live in, the deep tech world, is a very strong focus on the technology.
20:22
Kevin Chen: A love of where this technology came from, what I did to make it work.
20:29
Kevin Chen: Which is wonderful, but as we were talking about earlier, it's only one part of the equation.
20:34
Kevin Chen: The other part is, do customers really want this or is it solving a pain point?
20:38
Kevin Chen: So I see graduate students, let's say, you know, who are, who want to start a company, talk about the technology and get a little too deep into it.
20:49
Kevin Chen: I even see professional folks who maybe have not been a CEO before, but this is their first time.
20:55
Kevin Chen: They spend too much time on the technology.
20:57
Kevin Chen: So I think for an effective pitch Yes, the technology is important.
21:02
Kevin Chen: Get to the punchline, what is this technology?
21:06
Kevin Chen: Why is it differentiated?
21:09
Kevin Chen: How do we know that it works?
21:11
Kevin Chen: And then move on to other aspects of the company itself, not the technology, but the company.
21:17
Kevin Chen: Customers and team and financials and business plans, marketing, uh, so on and so forth.
21:23
Kevin Chen: So that's one thing that I, that I see.
21:27
Kevin Chen: Another thing is that pitches can be too long, uh, and it's kind of related to the first point.
21:34
Kevin Chen: If, if the time is not managed properly, these entrepreneurs are coming into a meeting expecting to give a 30 to 45 minute presentation, sticking to the script.
21:46
Kevin Chen: And I think there may be a time and place for that, but certainly not in the initial pitch.
21:52
Kevin Chen: I would recommend, and we recommend to our, uh, entrepreneurs that we work with, keep the pitch short.
22:00
Kevin Chen: Keep it 15 minutes or so.
22:02
Kevin Chen: Be ready for a 15 minute pitch.
22:04
Kevin Chen: And again, this may be obvious.
22:06
Kevin Chen: Uh, folks may have heard this advice before, but I think it's critical because as an investor now, I find that I just wish I had more time.
22:16
Kevin Chen: I wish I could take the time to really listen for 45 minutes.
22:21
Kevin Chen: But unfortunately, uh, we, we, you know, we have a small team.
22:26
Kevin Chen: We just don't have that time.
22:27
Kevin Chen: And so I think there are some very effective ways to pitch an investor where, you know, the entrepreneur is ready for a 15 minute pitch and they welcome getting interrupted with questions.
22:39
Kevin Chen: I think those are the best kinds of pitches.
22:43
Kevin Chen: So, um, in fact, uh, It's not going to be perfectly scripted.
22:46
Kevin Chen: They're not going to be able to do it in the way that they've rehearsed, again and again.
22:51
Kevin Chen: You know, you know, they'll have their pitch, but you're peppering them with questions.
22:55
Kevin Chen: Then you're going to see what they're like on the fly, what they really know.
22:58
Chris Reichhelm: You can kind of, you know, push around them, see, you know, you know, just how deep their knowledge goes.
23:04
Kevin Chen: There's that.
23:05
Kevin Chen: Exactly.
23:05
Kevin Chen: There's that.
23:06
Kevin Chen: There's that ability to see them as a real person rather than somebody coming in with a script.
23:13
Kevin Chen: There's a presenter.
23:15
Kevin Chen: There's also It's also good feedback.
23:18
Kevin Chen: It's from the, from the entrepreneur's point of view, it's a way to gauge if this investor is engaged.
23:24
Kevin Chen: If they're asking questions, they are engaged.
23:28
Kevin Chen: Hopefully they're good questions.
23:30
Kevin Chen: Um, but any kind of question can, can, you know, I think within 15 minutes is, is likely a good one.
23:35
Kevin Chen: Now that doesn't mean We purposely leave out information in order to elicit questions.
23:40
Kevin Chen: I think for the entrepreneur, it's about covering each of the key points in enough depth.
23:46
Kevin Chen: Key points being, what is the technology?
23:49
Kevin Chen: Has it been proven?
23:50
Kevin Chen: Do we have examples?
23:51
Kevin Chen: What is my market?
23:52
Kevin Chen: And so on and so forth.
23:54
Kevin Chen: Touch on each of those to sufficient depth and allow the investor to come in with their specific questions that they're curious about.
24:04
Kevin Chen: So, I think it's a two way street for the investor, it's, it's an efficient.
24:10
Kevin Chen: opportunity to learn about a company.
24:11
Kevin Chen: For the entrepreneur, it's a great opportunity to see if this is a good fit as a potential investor in the future.
24:17
Kevin Chen: Are they interested?
24:18
Kevin Chen: Are they knowledgeable?
24:20
Kevin Chen: So that's what I would advise.
24:22
Kevin Chen: And, um, I see a lot of times that entrepreneurs will come in with a presentation and they insist on following the slide, you know, sequence.
24:34
Kevin Chen: And they, if a question comes in, they say, well, I'll get to that in a few slides.
24:37
Kevin Chen: And then they go back to their rehearsed order of, of, of, of, of storytelling.
24:43
Kevin Chen: I think that can be a missed opportunity.
24:46
Kevin Chen: Um, one of the things that I was coached to do as an entrepreneur, And as an executive in a large company is when there's a question, answer it within the first three seconds, give an answer, literally three seconds after the question, answer it.
25:04
Kevin Chen: So the answer could be yes or no.
25:06
Kevin Chen: No, or maybe, but let me tell you about this.
25:10
Kevin Chen: So, there has to be an answer.
25:11
Kevin Chen: It can't be a long story with an answer at the end of it one minute later.
25:17
Kevin Chen: Uh, so, that's something that we also share with our entrepreneurs.
25:21
Kevin Chen: You know, answer the question when it's asked.
25:25
Kevin Chen: You can always go into more detail later, but answer it.
25:27
Kevin Chen: So, um, I think entrepreneurs who, who feel like they have to stick to their script lose an opportunity to engage that investor.
25:36
Chris Reichhelm: Yeah.
25:36
Kevin Chen: So that's, that's another thing that I've, that I've noticed.
25:38
Kevin Chen: So little things like that, that you learn along the way, uh, that could be effective.
25:43
Chris Reichhelm: What's the filter for, for Lam Capital?
25:48
Chris Reichhelm: What, you know, what do, where do companies need to be in terms of their technology development?
25:55
Chris Reichhelm: Do you have a particular, look, we want to see technologies that are at least a TRL5.
26:01
Chris Reichhelm: We want to see this kind of team in place.
26:03
Chris Reichhelm: We want to have an industrial partner already signed up or nearly signed up to sponsor the company's development.
26:11
Chris Reichhelm: And we, you know, what does that filter look like for you guys?
26:13
Chris Reichhelm: If there is one.
26:14
Kevin Chen: We, right there, there is a, I would say there's an implicit filter that we apply later in the process.
26:22
Kevin Chen: I say implicit because, um, we want to leave.
26:27
Kevin Chen: flexibility to find that diamond in the rough.
26:29
Kevin Chen: I don't want to put a filter on too early.
26:32
Kevin Chen: Um, but as a CVC, we have flexibility to invest in two graduate students working on an idea all the way up to the company has a hundred plus people and they already have a product.
26:46
Kevin Chen: So we have that flexibility.
26:48
Kevin Chen: So, um, that's also one of the reasons why we don't apply a filter, uh, too tight of a filter up front.
26:54
Kevin Chen: I would say in general, we do have some filters though.
26:57
Kevin Chen: One is.
26:59
Kevin Chen: the domain itself.
27:00
Kevin Chen: And as a very strategically oriented investor, we do look for companies in our domain or adjacent to our domain as we were talking about earlier.
27:11
Kevin Chen: So, if a company comes in that is in agriculture, for example, because I mentioned that because I spent some time there.
27:17
Kevin Chen: Unfortunately, we are not going to be a great investor for them.
27:19
Kevin Chen: That'll be a very quick filter for us.
27:21
Kevin Chen: So, I think that's, that's one.
27:24
Kevin Chen: As we get down the process of through, you know, through the first meeting, maybe the second or third meeting, we start applying other filters to the company.
27:33
Kevin Chen: And, um, one of the things that we do like to do as we evaluate companies is see if Lam Research as a company can help the startup and vice versa.
27:44
Kevin Chen: Are there technologies that the startup is working on that can help us in return?
27:48
Kevin Chen: And so that, those kinds of discussions take a little bit longer.
27:50
Kevin Chen: We bring in engineers, we bring in business people from our teams.
27:54
Kevin Chen: We bring in IP folks who look at the, uh, uh, the, the patents, for example.
28:00
Kevin Chen: And that becomes a little bit more of a deeper process of discovering if there is a strategic partnership that can, um, augment the relationship beyond just the, the financial aspect, the, the, the funding into the, into the equity route.
28:15
Kevin Chen: I would say some of the things that have given us pause are entrepreneurs who are difficult to work with.
28:23
Kevin Chen: So, folks who believe that, you know, so strongly in their approach that there's only their way of doing it.
28:33
Kevin Chen: Every company and I think that ends up being a telltale sign of somebody who may not be very successful in business development.
28:42
Kevin Chen: If you're coming in to an engagement with a prescribed way of doing things.
28:47
Kevin Chen: It's very hard to work with multiple customers that may have very different needs.
28:51
Kevin Chen: So, if we see that, if we see that inflexibility, uh, or the inability to Um, think about, uh, creative solutions, I think that's, that's a sign that things could be very difficult, not only for our relationship, but for the company itself, their success in the future.
29:07
Kevin Chen: So, we start looking for soft signals like that.
29:10
Kevin Chen: Um, we also look for, you know, uh, so a positive signal on the other hand would A company that is coming to us saying, you know, that has proved that their technology, or not proved, but maybe shown that their technology has been important to others in our same industry.
29:28
Kevin Chen: So, you know, one of the tricks that entrepreneurs can think of is, If there are three or four companies in a certain domain, um, you know, work them in parallel, right?
29:39
Kevin Chen: Get, get, get all of them talking in parallel and then you can kind of get a little bit of a competitive dynamic working among competitors in, in your, in your targeted sector and that can help the entrepreneur out.
29:49
Kevin Chen: So, as a, as a, as an, as a investor sitting on the other side of the table, if I see that there's traction going on in our industry, that will, will be a positive filter for us.
30:01
Kevin Chen: We want to know more.
30:02
Kevin Chen: We want to figure out how we can work with this company.
30:04
Chris Reichhelm: So there's a, there's a few different things.
30:06
Chris Reichhelm: There's traction on the part of the company or there's traction in the area they're in.
30:13
Kevin Chen: Correct.
30:13
Kevin Chen: Yeah.
30:13
Kevin Chen: Yeah.
30:14
Kevin Chen: If there's momentum, if it essentially tells us that, that this technology, uh, you know, works, you know, other, other folks that we respect are, are interested in, and maybe even signing up to, to use this technology, it shows that it works and it shows that it's relevant as well.
30:33
Chris Reichhelm: Let me ask you a different kind of question, Kevin, if I may, in your experience as an entrepreneur, as a corporate executive, as an investor, are there, are there any patterns you've learned to pick out or any observations you have about the way lab to market companies start, about their ideal starting point and their ideal starting team, um, that, that, more people should know about or like little belief systems or little patterns you, you know, you pick up on that, that may indicate a greater likelihood of success in the future.
31:20
Kevin Chen: Well, if we're talking about lab to market, uh, technology coming out of a university or out of an institute.
31:29
Kevin Chen: I think it begins with the, and this will sound very cliche, the, the, the founder or the founding team.
31:38
Kevin Chen: And it relates to the topic earlier about, um, being too focused on technology.
31:44
Kevin Chen: I think successful entrepreneurs uniquely have an ability to understand the technology, And, you know, the fact that it has to be commercialized, that there has to be a, a receiver on the other end of that technology that wants it.
32:03
Kevin Chen: So the water entrepreneur that I was talking about, there's another company that we invested in that has recently exited, which came out of Stanford University, uh, in the area of, uh, compact power supplies for industrial equipment, you know, and there's other examples as well.
32:20
Kevin Chen: These entrepreneurs were brilliant technologists, PhDs in some cases.
32:26
Kevin Chen: But they also had a mind to commercialization, a mind to linking that with a receiver on the other end.
32:35
Kevin Chen: So, I would say, you know, that's something that we, we look for.
32:41
Kevin Chen: Uh, and that is a Pretty, um, I don't know the statistics behind it, but it's, it's, it's been a good indicator for us of the potential future, you know, viability of, of these companies.
32:53
Kevin Chen: Now, if a, if a
32:56
Chris Reichhelm: Do you know, if you don't mind me interjecting here real quick, do you know?
33:01
Chris Reichhelm: if the inspiration for their technology development was driven by a problem they had identified in the market previously, or did they start developing a general platform technology and then seek to back that technology into a particular application area later on?
33:22
Kevin Chen: I, frankly, I think it can be both.
33:26
Kevin Chen: Uh, I don't recall the exact origins of these two examples that I had brought up, but even if I look at my own history.
33:36
Kevin Chen: I started a company coming out of MIT when I was working on an optical device for optical networking applications.
33:47
Kevin Chen: In that case, we were not successful.
33:50
Kevin Chen: I'll just end with, start with that.
33:52
Kevin Chen: But the origin of that technology was a government or it was a customer funded program so that we had a set of We had one large funding agency, a company that was funding that research that had a problem that they wanted to solve.
34:11
Kevin Chen: I guess the origins of the technology that I had worked on came from an industry problem.
34:17
Kevin Chen: And so, uh, there was that, that ability to translate that to, to real world.
34:22
Kevin Chen: In the case of a platform company, I think it would require a platform technology.
34:27
Kevin Chen: Maybe that, that wasn't seeded by a, by a corporate sponsor or wasn't seeded by an industrial need.
34:33
Kevin Chen: If it's a platform based technology, I think the founding team or the entrepreneur would need to select one or two key markets to address.
34:44
Kevin Chen: with that platform.
34:45
Kevin Chen: And so for those types of companies, having that mindset early on, I think is critical.
34:53
Chris Reichhelm: That, and that mindset, just to go a little deeper into that, that mindset that says we've got to find, before we go too far down the path of developing this technology, we've got to find a home for it.
35:05
Chris Reichhelm: We've got to find a problem that we can solve with this.
35:09
Kevin Chen: Absolutely.
35:10
Kevin Chen: Absolutely.
35:10
Chris Reichhelm: How early, how early do they need to have done that by?
35:14
Kevin Chen: I think they need to be thinking about that.
35:18
Kevin Chen: Quite early.
35:19
Kevin Chen: Now, if I say tease time zero is when this, when the company gets founded, meaning before that there could have been years of research.
35:30
Kevin Chen: I think in the research phase it's a different environment.
35:33
Kevin Chen: It's academia, it's publishing papers, it's, it's advancing science.
35:37
Kevin Chen: But once you hit time, zero I, which is, I'm gonna start this company at that point in time, I need to have an idea of what my top markets are going to be.
35:48
Kevin Chen: Uh, and so.
35:50
Kevin Chen: You know, that's got to be the way I think to start a company.
35:55
Kevin Chen: Uh, it's the problem that we often see is a, is a solution looking for a problem, a hammer looking for nails.
36:03
Kevin Chen: And that is, that is challenging.
36:06
Kevin Chen: So we, we need to advise entrepreneurs to make sure that there is a market need for this particular technology that I'm passionate about and start focusing on who are the customers in that market?
36:19
Kevin Chen: What are the exact Pain points that they have.
36:23
Chris Reichhelm: !Mm-Hmm.
36:23
Chris Reichhelm: .
36:23
Chris Reichhelm: Kevin Chen: And how can I solve?
36:24
Chris Reichhelm: And if, if the technology that I'm working on happens to be the best solution, great.
36:28
Chris Reichhelm: If it's not, then I need to go find another market for this technology that I've been working on.
36:34
Chris Reichhelm: Or unfortunately, there may not be this, the timing might not be right for this particular technology to become a company.
36:40
Chris Reichhelm: Yeah.
36:40
Chris Reichhelm: And so we have to be able to admit that as well.
36:43
Chris Reichhelm: How, um, how, how important is the team.
36:49
Chris Reichhelm: When you're investing and, and, you know, that can sound like a very obvious question, frankly, but, but, but, but you're a strategic investor.
36:59
Chris Reichhelm: You're also interested in the area where this innovation can potentially impact you.
37:04
Chris Reichhelm: You may or may not require the team, or you may require the team for a little bit, but then ultimately you can get the value out of the technology later on.
37:12
Chris Reichhelm: So, I've heard some investors say, and they've admitted, the team is kind of important, but it may not be the most important thing, because we can replace the team.
37:24
Chris Reichhelm: At a certain point and get a better team if we need to.
37:26
Chris Reichhelm: And in fact, we'll probably do so at some point along the journey.
37:29
Chris Reichhelm: So the team is important, but it's, it may not be the most important thing.
37:33
Chris Reichhelm: Most would say, Oh yeah, obviously the team's important.
37:36
Chris Reichhelm: It's what we're backing.
37:38
Chris Reichhelm: Where do you sit on that?
37:38
Kevin Chen: Right.
37:40
Kevin Chen: I can see both perspectives.
37:41
Kevin Chen: I think the team is hugely important, uh, because we need that team to run the company.
37:50
Kevin Chen: And to make sure they can keep the company going until such time that we feel like we can use the technology, if that is the scenario at play, uh, that, that, that our company would want to maybe buy this company or license some technology.
38:06
Kevin Chen: But we don't, we don't go into an investment with that in mind.
38:08
Kevin Chen: So, uh, having been an entrepreneur, there are so many uncertainties.
38:14
Kevin Chen: to making a company successful.
38:16
Kevin Chen: We need the team to be strong because they are the ones that are going to be running this company.
38:20
Kevin Chen: We as investors are not going to be running the company and we don't want to run the company.
38:24
Kevin Chen: We don't have the domain knowledge that the entrepreneurs have.
38:27
Kevin Chen: So I think the team needs to be able to pay the bills at the end of the day.
38:35
Kevin Chen: They need to be able to everything they do has to end up, uh, lining up, you know, in such a way.
38:44
Kevin Chen: that they can bring in revenue or raise money from investors or get grants from the government, they have to be able to bring in cash in order to keep the dream alive.
38:56
Kevin Chen: So that the team is hugely important.
38:59
Kevin Chen: Now, there is going to be an evolution in the team based on the stage of the company.
39:05
Kevin Chen: And um, that is something that we will encounter as the company grows.
39:11
Kevin Chen: Let's say for example, the Uh, a company gets to the stage where the founder, um, may want to bring in a domain expert in a given vertical that they're addressing.
39:22
Kevin Chen: Let's say it's the semiconductor vertical, and the person running the company initially is not a domain expert in the chip industry.
39:30
Kevin Chen: They might want to bring in either a independent board director, uh, who is a veteran of the chip industry to advise, And to open up connections, they may need to bring in a, a chief operating officer who will be able to scale up the company and, and run it in a way that a large, you know, customer will, will feel that, okay, this is a credible company, we, we can back this.
39:53
Kevin Chen: They may need to bring in a head of sales at that point in time who knows everybody in the chip industry that, that needs to be talked to.
40:00
Kevin Chen: Whatever it might be, there, there will come a time when the team has to evolve or the CEO themselves.
40:05
Kevin Chen: May find that they have brought the company from zero to one and, and the, you know, using that, uh, kind of analogy and to go from one to 10, maybe it's a, it's a different CEO that needs to be in place and the initial CEO will become the CTO.
40:21
Kevin Chen: So there will be an evolution at some point, but when we do invest at the beginning, we, we look at the team.
40:27
Kevin Chen: If this is the team that's going to be there for the next couple of years, we need that team to be amazing.
40:33
Chris Reichhelm: Is there a, a natural inflection point for you, or a common point at which teams change?
40:43
Kevin Chen: Um, I've seen cases where the original team has gone through all the way through to acquisition, and that's many years down the road.
40:54
Kevin Chen: And I've seen cases where the original founding technical team has, um, changed roles within the first couple years after funding.
41:01
Kevin Chen: Uh, so I think it, I, I think that the, the, the trigger point would be, um, market adoption and customer adoption.
41:11
Kevin Chen: Uh, and so when, when that hockey stick, you know, curve starts to go upwards, uh, even before that, when we get signs that, oh boy, there's more and more customers wanting to do, proof of concepts or more and more customers that want to sign up for pilot, pilot programs.
41:28
Kevin Chen: That might be a sign that, okay, we're going to enter a phase where we're going to start to commercialize this more and more.
41:34
Kevin Chen: And then we have to look around the team to say, to see, do we have the right commercialization folks here?
41:39
Kevin Chen: Do we have the right people that can ramp and, and, and get ready for the orders that are going to be coming in next year.
41:46
Kevin Chen: And so that might be a natural point to look at the, re look at the team.
41:50
Kevin Chen: And it's, it's more about, for me, it's more about putting the right.
41:55
Kevin Chen: pieces together for the company to be successful, rather than this person is not right for the job or that person is not right for the job.
42:03
Kevin Chen: It's more about, you know, how can we build the strongest case for this company to be successful?
42:09
Kevin Chen: And, um, uh, I think it takes a certain entrepreneur to be able to work together with their investors and board to understand that, hey, it might be the best for me as an entrepreneur to bring in more senior people who may, you know, know much more than, who should know much more than I do, and who may actually take my job as CEO.
42:28
Kevin Chen: We might, we might have to do that in order to grow this company and to become successful.
42:34
Chris Reichhelm: Yeah.
42:34
Kevin Chen: And that's, that's tough.
42:36
Kevin Chen: That's tough.
42:36
Chris Reichhelm: It is.
42:37
Chris Reichhelm: I mean, it's, you know, and, uh, and the irony is that the more successful you are, the more likely you probably need to change up the team because you're going to be encountering a lot of new challenges.
42:49
Chris Reichhelm: Um, and if you are trying to ensure a certain degree of success, so it's, It's a little bit perverse.
42:56
Chris Reichhelm: Well, I've been successful, you know, we've made progress, we've hit our milestones, we've gotten the validation, we're taking, you know, we're, we're making progress along our commercial journey.
43:07
Chris Reichhelm: And now we're going to encounter a whole new set of obstacles.
43:11
Chris Reichhelm: And for that, we're going to need to draft in new skills and, uh, you know, and the chairs are going to have to change.
43:19
Chris Reichhelm: Uh, so it is difficult.
43:21
Kevin Chen: It is.
43:22
Kevin Chen: And, and having been in, in, uh, the entrepreneur's shoes, when I took the role as CEO of Crop Enhancement, the, uh, uh, venture funded ag tech company, I just felt a huge responsibility to the team in place at the time because I was not the founder.
43:44
Kevin Chen: I came in and took over, uh, the reins from the founder.
43:48
Kevin Chen: Huge responsibility to the team, the employees and the investors.
43:53
Kevin Chen: And so my mindset was, I'm here to maximize the value of this company for everybody.
44:00
Kevin Chen: Uh, you know, including myself, I'm included in that, in that picture.
44:04
Kevin Chen: And so, um, there came a time after about almost five years that I felt maybe it's it's time for somebody else to lead this company into the next phase.
44:13
Kevin Chen: And that's, that was the transition I went through to leave that, uh, post and, and then come and, uh, join Lab Capital.
44:22
Kevin Chen: Uh, but, but, but, you know, when I left, uh, Crop Enhancement, we had just raised Series B.
44:27
Kevin Chen: So it wasn't like, I mean, the company was, was healthy, was growing.
44:31
Kevin Chen: And I, I felt that it was time for somebody else to lead it.
44:34
Kevin Chen: And the, the subsequent CEO was an industry veteran, 30 years in the ag industry.
44:41
Kevin Chen: Uh, with a commercial background, uh, knew everybody, uh, knew all the customers, you know, by, you know, first name basis, and, and he was the right person to lead the company, uh, through the next phase.
44:52
Kevin Chen: And so I, I've been through that, um, so I think it takes, you know, I think having the mentality of, I am here to maximize the value for everyone, uh, was the starting point, you know, is the starting point for, for being able to discuss, you know, future personnel changes, including for myself.
45:10
Chris Reichhelm: That's, uh, I think that's, that's compelling.
45:14
Chris Reichhelm: Um, let's talk about boards.
45:17
Chris Reichhelm: You sit on boards now as an investor, I'm sure, and your team sit on boards.
45:20
Chris Reichhelm: Yes.
45:21
Chris Reichhelm: You've been an entrepreneur and a CEO before, and so you've had boards as well.
45:26
Chris Reichhelm: Um, there are a lot of entrepreneur, excuse me, there are a lot of entrepreneurs who feel their boards are not worth an awful lot.
45:36
Chris Reichhelm: And that, uh, and so I think certainly in the UK and in Europe, a lot of the feedback we get is that the boards don't provide.
45:45
Chris Reichhelm: the kind of value that entrepreneurs would like.
45:49
Chris Reichhelm: Did you find that as an entrepreneur?
45:51
Chris Reichhelm: Do you observe that as someone who participates on boards now?
45:58
Kevin Chen: I think in general, it, I've seen both situations, uh, effective boards and dysfunctional ones.
46:07
Kevin Chen: And I've, and I've been on both.
46:09
Kevin Chen: Um, and I agree that a board should be, ideally, should be a very productive environment and it should be a value add.
46:18
Kevin Chen: But unfortunately, in, in some cases, it's not.
46:22
Kevin Chen: Um, and in the cases where it's not, uh, I can't generalize because every situation is different, but I believe that in, in many cases, it's perhaps one or two members of a multi member board who may be, uh, uh, you know, uh, not who, who might not be adding value or who might be disruptive, who might sidetrack conversations or do other things that are not productive.
46:52
Kevin Chen: Um, and so, those are, you know, situations that an entrepreneur has to deal with.
46:57
Kevin Chen: It's part of their job.
46:58
Kevin Chen: You know, the CEO is held accountable by the board.
47:02
Kevin Chen: And so, uh, just as any employee would, uh, want to develop a good relationship with their manager and be aligned with their manager in a, in a, in a normal, uh, setting.
47:16
Kevin Chen: A CEO and management team should work hard, gain alignment, and develop a relationship with each of their board members.
47:25
Kevin Chen: So, um, One of the things that I've seen which is effective, which I also learned how to do as a CEO, is have individual meetings with board members between the board meetings.
47:41
Kevin Chen: So if a board meeting is every three months, Use that intervening time to set up one on one meetings with each board member and get to know them, get to know what they're interested in, what they're concerned about, and start developing that relationship, number one.
47:55
Kevin Chen: Number two, use that opportunity to answer, uh, questions or, or, or mitigate concerns that that board member may have and gain alignment so that when there is a board meeting at the third month, A lot of those, uh, questions and issues can be, uh, you'd go into those meetings with those questions resolved and, and, and thereby have a much smoother, uh, board meeting.
48:20
Kevin Chen: I think
48:20
Chris Reichhelm: How many board meetings do you typically have a year?
48:22
Chris Reichhelm: Oh, sorry.
48:23
Chris Reichhelm: I didn't mean to interrupt you there.
48:24
Chris Reichhelm: How many board meetings do you typically have a year?
48:27
Kevin Chen: Uh, I think, um, pretty standard, uh, for us is, is about four.
48:31
Kevin Chen: So quarterly, I, uh, there's, there is one company that does it every two months so that there'd be six board meetings.
48:37
Kevin Chen: And then, um, in cases where.
48:40
Kevin Chen: Uh, a company is maybe going through some issues, uh, could be a week, could be a monthly board meeting until the issue is resolved.
48:47
Kevin Chen: Let's say, let's say there's a cash crunch and it needs to be resolved, or there's some, um, uh, serious technical issue and it needs to be resolved.
48:55
Kevin Chen: So, uh, in those cases, uh, it could be as frequent as, as, uh, uh, once a month.
49:01
Kevin Chen: I've been in situations where there are weekly standing board meetings.
49:05
Kevin Chen: Uh, when things are very, very much in a, in an emergency situation, and then that'll happen for some period of time.
49:12
Kevin Chen: And then if the emergency is resolved, then we go back to a quarterly basis.
49:16
Kevin Chen: So, it, it, it all depends.
49:17
Kevin Chen: All depends.
49:19
Kevin Chen: But just, just to go back to the, the issue of, you know, how, how do we manage a board?
49:24
Kevin Chen: I think the other, Um, helpful thing, uh, uh, could be to break, uh, two things, uh, one, uh, bring on, if there's, if there's, uh, uh, an ability to do so, bring on an independent board director, ideally from the industry that, uh, the company is targeting.
49:41
Kevin Chen: So, if it's an agriculture company, maybe bring in an experienced, uh, former executive of an agriculture customer and have that person be on the board.
49:49
Kevin Chen: What I, what I've seen in those cases, and, and that's what we did at Crop Enhancement for example.
49:54
Kevin Chen: We brought in a, a very experienced, uh, executive from the ag chemical industry.
50:00
Kevin Chen: The independent board director can do a couple of things.
50:02
Kevin Chen: One, they can be a, a wonderful mentor to the CEO or the management team, open it, opening up doors and advising based on their experience.
50:11
Kevin Chen: Uh, and then number two, being a way, offering the ability to bring along other board members who may not have that deep of, of a background in, in this particular domain and, uh, and helping them to see.
50:25
Kevin Chen: That what the company is actually doing is what they should be doing and, and not to, you know, have to question everything that, that, that the management team is, is, is proposing.
50:35
Kevin Chen: So, bringing credibility, you know, bringing, bringing credibility to, to what the, management team is already doing and bringing along other, uh, maybe non domain experts on the board, bringing them along as well.
50:49
Kevin Chen: So that's another way to manage a board.
50:53
Chris Reichhelm: In the UK and in Europe, the role of chair and CEO are mostly separate and that role that you describe almost an independent individual, a director on the board to, to make sure that the board is behaving.
51:14
Chris Reichhelm: And the board is up to speed.
51:15
Chris Reichhelm: The chair may or may not have the domain expertise and relevant, but they will, they probably will have startup experience.
51:24
Chris Reichhelm: They will know the lab to market journey.
51:27
Chris Reichhelm: Uh, it might be in a separate, it probably is in a separate domain.
51:29
Chris Reichhelm: Occasionally it's similar, but there'll be able to act as a good mentor for the CEO.
51:35
Chris Reichhelm: And there'll be able to act as an umbrella as well for the stuff that can kick, that can sometimes kick off at board allowing the CEO to just focus on getting on with the role while she or he takes responsibility for herding cats and making sure the board gets aligned.
51:51
Chris Reichhelm: Is that a similar model, or do you see the chair and CEO often in the same position?
51:58
Kevin Chen: I, I, I do see, uh, chair and CEO being a different, you know, being two different people in cases where the board is quite large.
52:10
Kevin Chen: I think that's where a board chair can really be valuable.
52:14
Kevin Chen: Um, and by board, I mean board directors as well as observers who may not have a vote in certain decisions, but are also a voice at the table.
52:23
Kevin Chen: Uh, and as a strategic investor, we, we send observers to our, uh, portfolio companies.
52:28
Kevin Chen: And, and so in some cases, Uh, there could be board meetings where there are maybe, you know, three executives, the CEO, CTO, and maybe the finance person, but there might be 10 or 11 board members slash observers in the room.
52:41
Kevin Chen: And it's very hard for the CEO to be able to manage, excuse me, uh, those, uh, folks each coming with different concerns and ideas.
52:50
Kevin Chen: And I, so, so that the pre work of meeting ahead of time, that helps.
52:54
Kevin Chen: But, during the meeting, I think having a board chair is very useful, uh, in terms of the governance aspects, calling for votes, moving the agenda along, keeping track of time, uh, and then, you know, keeping folks focused.
53:08
Kevin Chen: So, I think in that case, the board chair and the CEO must work very closely together as a team.
53:14
Kevin Chen: Uh, the CEO must, um, You know, trust what the chair is going to be doing during meetings and, and behave as a team, uh, and that's going to take coordination and relationship building and all that, but come in as a team, you deal with this stuff, I'll deal with that stuff and, um, make things very efficient.
53:35
Chris Reichhelm: If, um, Kevin, I've so enjoyed this.
53:39
Chris Reichhelm: One final question for you, though.
53:41
Chris Reichhelm: If you could wave a magic wand and fashion up core skills that leading entrepreneurs would possess.
53:54
Chris Reichhelm: More of.
53:56
Chris Reichhelm: What skills would they be?
54:01
Kevin Chen: I would say Communication, great, concise, targeted communication, A, B, relationship building skills, ability to, you know, uh, relate to people of different backgrounds, relate to different investors, different constituencies, employees, customers, advisors.
54:24
Kevin Chen: Number three, a humility.
54:31
Kevin Chen: I think a type of humility, which says, which is not, you know, tell me what to do.
54:37
Kevin Chen: I don't want to overset my boundaries.
54:39
Kevin Chen: Not that type of behavior, but I'm confident, but I'm also open to feedback.
54:45
Kevin Chen: I'm open to learning and I'm willing to grow.
54:48
Kevin Chen: That's what I mean by humility.
54:51
Kevin Chen: I think those three would, would be humility.
54:53
Kevin Chen: A great, like, set of characteristics for a, for an entrepreneur, uh, and so, um, you know, two out of those three relate to people, uh, I, I haven't said anything about technology.
55:09
Kevin Chen: I haven't said anything about, you know, uh, things related to the deep tech aspect of it.
55:15
Kevin Chen: Um, so, because I think an entrepreneur, a CEO has to be more than a technologist.
55:23
Kevin Chen: And to be successful in the lab to market journey is not just about making sure the technology works.
55:29
Kevin Chen: It's about all the other things, raising money, hiring people, managing a board, bringing on advisors, working with difficult customers, getting purchase orders, uh, Firing people that may not be a great fit.
55:45
Kevin Chen: All of those things are people related.
55:48
Kevin Chen: And yes, it's based on the technology that I'm bringing, but ultimately, it's more than just the technology itself.
55:57
Kevin Chen: So, I would say those would be the, you know, a couple of things that I would wish every entrepreneur could have.
56:03
Chris Reichhelm: Kevin Chen, thank you so much for joining me today.
56:07
Kevin Chen: Thank you so much, Chris.
56:08
Kevin Chen: I've enjoyed this tremendously.
56:09
Kevin Chen: Thanks for inviting me.
56:12
Chris Reichhelm: You've been listening to the Lab to Market Leadership podcast, brought to you by Deep Tech Leaders.
56:18
Chris Reichhelm: This podcast has been produced by Beauxhaus you can find out more about us on LinkedIn, Spotify, Apple, or wherever you get your podcasts.