I have been fortunate to have been associated with several category creators and leaders in enterprise technology. I came to venture capital in 2001 after being an early senior executive at two venture backed startups that went public with multi-billion dollar market caps (FORE Systems and Alteon WebSystems). I spent a decade at Matrix Partners, three years at Khosla Ventures, and a recent stint at Formation8. I have had the opportunity to invest in a number of impactful companies, investing very early in category creators such as Nutanix (Nasdaq::NTNX), Aruba Networks (Nasdaq::ARUN), Blue River Technologies (acquired by John Deere), and many more.
After having spent 17 years in large venture funds, I have now joined Cervin Ventures as a General Partner. Cervin is a small pre-Series A enterprise technology venture capital fund. This appears counterintuitive, and not what you would have expected from me. So why did I make such a move? What’s going on here?
I have two answers, one that reflects upon the industry as a whole, and another that is specific to Cervin.
The venture industry has changed dramatically. The funds have gone from big to colossal with some funds having tens of billions under management. At the same time, the amount of money needed to build a minimum viable product (MVP) at a company and achieve product market fit has reduced. Because of the public cloud, open-source software, digital marketing/demand-gen techniques, companies simply don’t need as much money today to build a viable business as they did before. This trend makes me a strong believer that small funds like Cervin will have superior cash on cash multiples compared to the mega funds. With the exception of a handful of outliers, most of the mega-funds will not have returns that are appropriate for the venture asset class. Put simply, I believe “Small is The New BIG!”
At Cervin, I now have the opportunity to return to my roots of smaller, more impactful investments through the firm’s hands-on investment style. All of the partners at Cervin Ventures were successful operators before they became venture capitalists. They each founded or had senior roles in companies that proved to be highly successful businesses. Each of the partners at Cervin brings operational experience to the table, which in turn allows us to make the right strategic recommendations for our early-stage companies.
Cervin has the same “small is big” mindset and appetite for the kind of investments that drove my passion and interest for venture capital from the beginning — they’re providing me with the opportunity to work with smaller seed companies and buck the growing trend towards mega investments, which tend to lose the magic that comes along with smaller scale, more focused investing. I’m super excited about the opportunity to work with passionate founders to build businesses from the grounds up.
My track record with enterprise companies also has many synergies with Cervin’s focus in finding the best entrepreneurs that are creating the next wave of enterprise technology. Our number one goal at Cervin is to guide them through the challenges of building successful companies, as many are first-time founders. Cervin’s is unique in many respects. They have the ability to write $1M-$2M seed cheques, reserve enough dry powder for future rounds and maximize value for entrepreneurs even when the standard venture capital path may not be available.
As General Partner with Cervin, I look forward to this next chapter and continuing to be a resource to women and men putting in their blood, sweat, and tears into their passions.