LtM ep13 - How Khosla Ventures Invests In Deep Tech, with Kanu Gulati and Rajesh Swaminathan

Khosla Ventures (KV) has been an active investor in deep tech for 15 years. In this episode they share ideas on how they select sectors to invest in and prioritize and retire risk, how to best support startups, and what investors need to enter the deep tech field (hint: it's not a PhD).

This podcast is hosted by Benjamin Joffe, Partner at SOSV, a global early stage fund focused on deep tech. SOSV runs multiple accelerator programs including HAX (intelligent hardware) and IndieBio (life sciences). To hear about new episodes, sign up to the newsletter or follow us on twitter at @LabToMarket.

OVERVIEW

Kanu Gulati and Rajesh Swaminathan are Investment Partners focused on deep tech at Khosla Ventures. The firm was founded by Vinod Khosla -- co-founder of Sun Microsystems (acquired by Oracle for US$7.4 billion in 2009) and former General Partner at Kleiner Perkins -- with the goal of ‘Reinventing Social Infrastructure with Technology’, to elevate the entire planet’s quality of life without destroying it.

• Over the past 15 years, KV has raised over $5B across 6 funds and invested in about 400 startups including Impossible Foods, Rocket Lab, DoorDash, OpenAI and many more.
• They invest mostly at early stage — signing checks ranging from a few hundred $k, up to $50 million — and without shying away from the high technical risk of deep tech.

After an introduction and examples from KV’s portfolio, the conversation goes into:

• Why it is crucial to prioritize risks and retire them in the right order.
• The 12 different technologies that can move the needle for the climate crisis.
• Their approach to detecting startups from centers of excellence.
• What sectors KV focuses on, including climate tech, hyperlocal and bio-manufacturing, hardware acceleration for AI, and more.
• What investment and operating partners do.
• How they support their portfolio in particular with recruiting (white paper). Vinod Khosla even calls himself a ‘glorified recruiter’!
• How conviction, immersion, patience and staying power matter more than a PhD to start investing in deep tech.
• How more engagement between financial and corporate VCs, building more forums and reducing inefficiencies in the deep tech ecosystem could help.

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