Don Valentine: Gandfather of VC

Don Valentine founded Sequoia in 1972, before the terms “Silicon Valley” and “venture capital” had been coined. His original investments includes Apple, Atari, Oracle, Cisco, etc. Prior to founding Sequoia Capital, Don served as a sales and marketing executive at Fairchild Semiconductor for seven years before he went on to establish National Semiconductor. Don obtained his Bachelor of Science in Chemistry from Fordham University in 1954.

We focus on the size of the market, the dynamics of the market, the nature of competition because our object is always to build big companies.

We don’t choose people, we choose markets. We don't care about the background of the founders and we rarely ever invest in an area with only one product.

Take Apple for example, we finance more than one memory company or disk drive company. Without the memory system, the PC is nothing. Apple found sth. they are needed in Xerox PARC and we finance all these things. This is how we choose to invest on a system application level. We looked at the system and made over 15 investments in the category.

We also invested in many inexperienced young people and taught them outsourcing.

The only thing that matters is they must be very good at tech and engineering and that normally took us about six people to start the company. The secondary functional skill we are interested in is marketing.

We think creating a market is too expensive for our checkbook and are more interested in exploring markets early.

Good people are technologists with no interest in becoming wealthy and keen on solving tech problems and creating new products.

Unlike most VC people, we don’t wait for you to knock on our door, we knock on your door. We are actively looking for the right people with the capability to solve the problem we are interested in.

We have a team with different expertise in developing a knowledge base  and market sizing info. We tend to invest application system approach.

The art of storytelling is incredibly important because money flows as a function of the stories.

Learning how to ask a question is way more important than anything in the world (20 words maximum). For many investments we made, we didn't understand the answers, but we constantly worked on developing the questions.

When a company we invested in failed, we always have post mortems to figure out what we missed, what questions we didn’t ask.

We are less interested in their education than in what they did in their prior companies. We make the management system as easy as possible and if we can outsource something, never make it in-house.

Only one metric in finance matters to us and that is cash flow. We hire people who are wizards at cash flow.

We don’t need balance sheets and we love recessions.

What didn't work is the dynamics of markets. We developed some spectacular things for which there were no buyers. The critical thing is  getting a product developed where the timing of the product’s availability and the market demand are simultaneous.

We didn’t finance our portfolio companies any more if no one wanted their products.

But when those companies meet the milestones, we then refinance them.

Don Valentine: Gandfather of VC

Don Valentine founded Sequoia in 1972, before the terms “Silicon Valley” and “venture capital” had been coined. His original investments includes Apple, Atari, Oracle, Cisco, etc. Prior to founding Sequoia Capital, Don served as a sales and marketing executive at Fairchild Semiconductor for seven years before he went on to establish National Semiconductor. Don obtained his Bachelor of Science in Chemistry from Fordham University in 1954.

We focus on the size of the market, the dynamics of the market, the nature of competition because our object is always to build big companies.

We don’t choose people, we choose markets. We don't care about the background of the founders and we rarely ever invest in an area with only one product.

Take Apple for example, we finance more than one memory company or disk drive company. Without the memory system, the PC is nothing. Apple found sth. they are needed in Xerox PARC and we finance all these things. This is how we choose to invest on a system application level. We looked at the system and made over 15 investments in the category.

We also invested in many inexperienced young people and taught them outsourcing.

The only thing that matters is they must be very good at tech and engineering and that normally took us about six people to start the company. The secondary functional skill we are interested in is marketing.

We think creating a market is too expensive for our checkbook and are more interested in exploring markets early.

Good people are technologists with no interest in becoming wealthy and keen on solving tech problems and creating new products.

Unlike most VC people, we don’t wait for you to knock on our door, we knock on your door. We are actively looking for the right people with the capability to solve the problem we are interested in.

We have a team with different expertise in developing a knowledge base  and market sizing info. We tend to invest application system approach.

The art of storytelling is incredibly important because money flows as a function of the stories.

Learning how to ask a question is way more important than anything in the world (20 words maximum). For many investments we made, we didn't understand the answers, but we constantly worked on developing the questions.

When a company we invested in failed, we always have post mortems to figure out what we missed, what questions we didn’t ask.

We are less interested in their education than in what they did in their prior companies. We make the management system as easy as possible and if we can outsource something, never make it in-house.

Only one metric in finance matters to us and that is cash flow. We hire people who are wizards at cash flow.

We don’t need balance sheets and we love recessions.

What didn't work is the dynamics of markets. We developed some spectacular things for which there were no buyers. The critical thing is  getting a product developed where the timing of the product’s availability and the market demand are simultaneous.

We didn’t finance our portfolio companies any more if no one wanted their products.

But when those companies meet the milestones, we then refinance them.