Don Valentine, Sequoia Capital: “Target Big Markets”

Notes

• Good interview question - why do you think we are successful?

• Objective was always to build big companies

• If you are not attacking a large market / it’s highly unlikely that you’ll build a big company

• We choose Markets / and then we invest in those Markets

• PC Market / we not just invested in Apple / we invested in Disk Drive companies / we invested in Floppy Disk companies

• PC System / what else do you invest in?

• 15 investments in that category

• In that category / we invested in applications

• We invested in EA

• EA was started in Sequoia’s office

• People underestimate Marketing

• Xerox is one of my biggest disappointments

• They listened to Wall Street

• They abandoned their strength

• Their Board was not good

• We are not interested in creating Markets

• We are interested in exploiting Markets early

• We love working with Technologists / those who have a dream to solve a problem

• People who love creating New Products / who love solving technology problems

• Story Telling is a super important skill

• Learning to tell the story is critically important because that’s how the Money works

• Money flows as a function of the stories

• Only metric that matters in Finance is Cash Flow

• We hire people that are Wizards in Cash Flow

• We love recessions

• We look forward to recessions

• Recessions are the best time to invest / didn’t understand this point completely

• I knew in the future

• I spent 10-12 years in the Semiconductor Business

• Knowing the future made it easy for us to invest in a company like Atari very early

• Apple / Atari / all Microprocessor driven

• “Silicon Valley”

• Catholic Church was wrong

• The world is flat

• Once you go past Denver / you go off the edge into a technological oblivion

• Success has to breed big monuments