Kicking off Mental Health Awareness Month, today’s episode features Somesh Dash. He was recognized as one of the top 100 venture capitalists by The New York Times and CB Insights and by GrowthCap as one of the top 40 under 40 Growth Investors.
With roots in India, Somesh Dash, the Managing Director and General Partner of IVP sits down with Sean Li to have an epic conversation around topics ranging: their shared experience of immigrating to the United States, the importance of mental health in the business space, violence against Asian Americans, the Ronald Reagan era, racism, and cultural awareness.
We gain insight as Somesh walks us through his story of coming up in Silicon Valley. He takes us to the heyday of the dotcom movement and the height of tech IPOs, what he’s learned about venture capital, and how lending a quarter to a random stranger over 20 years ago led him to where he is today.
On mental health:
“Coming out of the pandemic, I really think people are going to want to maintain some of the good that came out of this virtualized world, which is being able to slow it down, think a little bit about what’s important to them or not, and get the help they need. I think the reality is we’re all seeing every day in the news examples of breakdowns in our public health infrastructure that are leading to some of these massive societal issues. A lot of the stuff is related to mass shootings and violence and communities—the root of it is community health and mental health. And unfortunately, the system hasn’t modernized in the way that science has or that the private sector has. So, I’m bullish that entrepreneurs and startups and growth companies can make a real difference while doing it in conjunction with local state and federal governments.”
On venture capital:
“Part of venture more than ever now is storytelling. It’s storytelling to the entrepreneur about who you are as an individual or as a firm and why you could be a great partner to them, especially for competitive rounds. It’s telling the story of the company to outside stakeholders, whether it’s trying to recruit executives or board members, trying to help with customer acquisition, trying to help with the public markets story. I mean, a lot of what you do is becoming, in a sense, an evangelist for these companies.”
On cultural awareness:
“And that always stuck to me, which is, even as a kid growing up here, I grew up seeing a lot of things around—it was more of just ignorance about Indian culture as I’m sure you saw, Sean, with Chinese culture. But once you expose people to it, I mean, who doesn’t want to go to like a big Indian wedding?”
“I think the stories that you have, Sean, or I had, are the things that can actually sway public opinion more than just the policy or just the talking heads on cable television. And I wish there was more discourse about that because I think once people realize how much more similar we all are than different, I think the racism we’re seeing, the xenophobia, naturally begins to ebb.”
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(Transcripts may contain a few typographical errors due to audio quality during the podcast recording.)
Sean Li: Welcome to the OneHaas Alumni podcast. I’m your host, Sean Li. And today we’re joined by Somesh Dash. Somesh has roots in Odisha, India. However, he was brought up in California and completed his degree in business administration from UC Berkeley in 2001 and MBA from Stanford University in 2010.
He is the managing director and general partner of IVP, a well-known late-stage venture capital and growth equity firm. And Somesh is recognized by the New York times and CB insights as one of the top 100 venture capitalists and by growth cap as one of the top 40 under 40 growth investors.
[00:00:41] Welcome to the podcast.
[00:00:43]Somesh Dash: Thanks. Go Bears! Thanks for having me.
[00:00:45]Sean Li Go Bears! First off, you know, our listeners are always interested in our guests’ background. Can you tell us a little bit about your roots in Odisha and your origin?
[00:00:54]Somesh Dash: Well, this is probably the first time someone’s asked me to go to the Homeland and hit the roots. I was actually born in California and I think my childhood was this interesting juxtaposition where my parents came as Indian immigrants originally to Canada for graduate school.
[00:01:11] Lived there in the seventies and right in the turn of that decade to 1980. At the time of President Reagan, they moved to California. My father took a role at IBM. He worked at Fireman’s Fund Insurance Company and then went to IBM.
[00:01:24] But, I was very lucky that I got to grow up in Silicon Valley when there was actually silicon being created. And I remember as a young kid driving down the 280 and seeing the original Apple building. And, seeing the little Apple that was bitten into in ‘84, ‘85, I didn’t think much of it, Sean. To me, it was like, “Oh yeah, there’s some, cool company called Apple”. I remember when I got to use my first Apple too. And of course, I got to see the Macintosh that was like, “Oh, that company that we drive by to see, our uncle is producing this thing. Wow! This is kind of cool.” So because my father worked at IBM, I think I was exposed to technology at a young age and Silicon Valley. My parents were Indian immigrants and a lot of our family friends.
[00:02:10] The people who had originally gone to IIT or other engineering schools in India, and then come for graduate school at Cal, Stanford, Davis or California, and then stayed here, many of them worked at Intel and the semiconductor world. My father was sort of a rebel. His background was more in software engineering. So he worked at IBM and eventually Oracle. I got to see firsthand Silicon Valley and got to see cycles of innovation and, and how they affected different generations. But then, I would go back to India every 12 to 18 months from the age of one. I went back not only to see where my parents are from. For those of you who don’t know, India’s got about 40 recognized states now, and Odisha has traditionally been on the bottom of the economic ladder. It’s got the lowest literacy rates. It’s a state that’s got amazing resources but, when I was growing up in the eighties they had a pretty high poverty rate and weren’t as developed.
[00:03:06]So I had this interesting juxtaposition where I was sitting here. The son of immigrants. Parents worked in tech, in Silicon Valley. And then, I would go back where my first cousins, would have power outages for three to four hours a day in the sweltering heat. There would be things that we take so much for granted, like running water. Basic needs, in terms of sanitation guidelines around food and health, a lot of that wasn’t there. And yet, I didn’t really care because I went at a young age. I just knew them as my uncles, my aunts, my cousins, and my grandparents.
[00:03:40] And I actually look forward so much to those trips. I would always cry. When I would come home and all the family would cry. It would just be like this amazing connection that I had. And I learned so much about Indian culture just by spending so much time there as a kid. I always embraced my Indian-American background. I would be watching Bollywood movies and listening to Indian music and Bhangra. But, I also grew up a diehard, Warriors and Knights fan. I listen to hip hop and rock. I was thinking about this other day. I think Indian culture is pretty multicultural in itself and polytheistic. My parents are Hindu. We have many different languages and, cultures, and subcultures. So there was never this, “You have to choose this or that”. For me, it was like, “I just want that, that, and that”. I would just start and continue to accumulate interests and passions.
[00:04:29] I grew up in South San Jose. I went to Leland High School. And then for me, as a Bay area kid, there were really schools that were always aspirational. One was Callum. One was Stanford. I guess, I was lucky to go to both at different points in my life. I liked the order.
[00:04:46] I went to Cal for my undergrad. And, for me, I was the first person in my family to go to a U.S. undergraduate institution. My parents had come to the U.S. to do graduate school. But that was a new experience. Then, my brother followed and many cousins after that. But, it was really special for me. Cal’s always a very special place because it gave me that opportunity.
[00:05:04] My parents came for education. That is the theme that even today in immigration. I think people sometimes don’t think enough about it. In all the heated immigration debate, people forget that a lot of people come for our system, our educational system. It’s not that so that they could drain the United States of resources and immediately go back. My dad came in and never went back. I think he built his entire life and family. My mom did. And so many others, I noted in this country. I always joke that we’re the happily highest tax-paying bracket, Indian Americans in the Bay area. That is, you know, capitalistic patriotism in a lot of ways too. So I think that’s a very special thing. I just feel, really, lucky that I got to be a part of that. By just being born here and two amazing parents.
[00:05:52]Sean Li: A Couple of things that want to unpack from that story. One that early on, you mentioned Reagan. I just recently became a U.S. citizen in 2018. I moved here in ‘92 but…
[00:06:04] Somesh Dash [00:06:04] Congratulations.
[00:06:05] Sean Li: For part laziness, part other reasons, like we traveling to China a lot. Similarly with you. I just never got around to changing citizenship until after Trump. I thought, “You know, it’s time. I need to vote.” I got to participate in my first elections last year. It was amazing. But, speaking of Ronald Reagan, I remember one of the speeches that he gave around how this is the only country in the world that you can come to and call yourself an American after staying here for 10 years. There’s nowhere else that you’ll go, right? You can’t go to Brazil, Japan or India. Live there for 10 years like me and call myself an Indian. Right? It just wouldn’t work that way. And that’s a very interesting fact about the United States. I thought that was neat. And the second thing, that I relate with you on is, I know, your roots are in Eastern India. Right? I come from China. Similar to India. When people ask me, “Oh, you’re from China?” Like when they ask you, “You’re from India?” They always ask what part of India or China. So these are big countries right there. As you said, they’re so multicultural, so many languages and backgrounds, cuisines, just everything North and South, East and West are completely different. And they always ask this question. They want to know where you’re from. It so happens, I come from a province in China, Southwest called Guangzhou. right next to Shenzhen where the spicy food is. That’s the second poorest province in our country. I definitely can relate to your story going back. It’s this dichotomy of, “Wow! We have everything here and there there’s barely anything there”. But didn’t matter, you know, I loved it.
[00:07:38]Somesh Dash: Yeah, it was interesting. I learned years later when I joined IVP, our founder, Reid, Dennis who’s still alive today. He worked closely with President Reagan when he was governor of California. He did a lot of work around getting pension funds to be able to invest in the asset class. He wrote a very famous editorial. Ronald Reagan did before he ran for president. He wrote about venture capital as a creator of economic growth and was a big advocate for the reforms that led to this industry being created. I don’t think enough credit is given to him and the group of people that worked with him to make that happen in the mid-seventies.
[00:08:11] This was a cottage industry. If you actually look at the text, Reagan, when he was up and coming in California politics, and then early in his tenure, in the national polls, he is what we would describe today as a moderate. You look at his speeches, his orientation and it was essentially back in the day it was not quite as moderate. But it was in the middle of being fiscally conservative. And in many aspects, not all socially liberal. And I think immigration was something he did focus on with the team that was around him. Whether it was Jim Baker, George Schultz, and the people from that school like Condee Rice and others, Steve Hadley. I think many of them carry that torch and tradition where you could be a fiscal conservative and believe in sound immigration policy.
[00:08:58] And it’s just an absurd thing. I was involved about a decade ago in immigration reform debates in DC and California. It was just ridiculous to me. As I dug in, to see how much people agreed that immigration was such a catalyzing force to this country and the heritage of the United States. Yet, a politicized debate had become even before Trump and all of that.
[00:09:20] I think the stories that you have Sean or I had, are the things that can sway public opinion. More than just the policy or just the talking heads on cable television. And I wish there was more, discourse about that because I think once people realize how much more similar we all are, I think the racism we’re seeing, the xenophobia naturally begins to ebb.
[00:09:46] Sean Li: I think that with this kind of trigger-happy or short attention span, you’re always on-demand, an instant-everything society that we live in, people don’t take the time to have discourse. I think that’s why these platforms like podcasting, where they have a long segment. They add a lot more color and perspective to the people that we have, not only in this country but around the world.
[00:10:09] Somesh Dash: There’s a formative book I read in college. It was by, this guy from the Kennedy school. He talks about this concept of self-power. Everyone thinks American influence was thought to be defined by hard power, which is weaponry and machinery, arms hard tech. policy centralized control.
[00:10:28]But actually if you look at the Middle East and you look at countries that have very different governments, the reason America stayed so popular for many decades was because of soft power. It was sports, music, MTV, and all kinds of things, that America represented and created. The creative community created that and it led to this being an aspirational place. And that always stuck to me, even as a kid growing up here. I grew up seeing a lot of things around. It was more of just ignorance about Indian culture, as I’m sure you saw Sean, with Chinese culture. But once you expose people to it, I mean, who doesn’t want to go to like a big Indian wedding?
[00:11:04] Sean Li: Exactly.
[00:11:05] Somesh Dash And have a great Indian meal? I mean, it’s hard to not like certain things or have spicy Sichuan cuisine. Like it’s not that controversial when you get down to it. It’s just fear from the unknown.
[00:11:15]Sean Li: Absolutely. Well, coming back to you, you went to high school, went to Berkeley, went to Stanford, and in between, I’m sure you did a lot of things. How did you become a venture capitalist?
[00:11:25]Somesh Dash: Well, it goes back to Berkeley as well. I was there from ‘97 to 2001. I started, pre-med like most good Chinese and Indian kids at Cal. But, I was interested always in, the humanities. I did. I loved English, History, Foreign Languages, Rhetoric, and all these sorts of things in high school. And I continued those interests with my courses. I chose to take them in college. But I remember taking a few economics classes early on. We were lucky that when we were at Cal, Laura Tyson was Dean, which has come off the Clinton administration. Janet Yellen taught our economics class. Christina Romer was at Cal. Looking back, I don’t think I even appreciated just how illustrious the faculty was at Cal. But, I had the chance to sit in on some of those seminars and courses at a young age. And I learned about the Haas business program. It was still relatively new and certainly undermarketed versus what it is today. And I thought, “Well, let me just apply”. Maybe it might be a nice thing to do besides, pursuing a degree in molecular cell biology. And I got in and I did an internship that summer, at Charles Schwab. And it was really, unique for me because I’d never been to a professional workplace before.
[00:12:36] It was a structured internship program and I met kids from Penn and Stanford. I said, “This is kind of fun”. I found I enjoyed not just the academic side of the business, but the practical side. Talking to people, working on projects, collaborating. So I said, “let me go down this path”.
[00:12:52] I did a year-long co-op at Sybase which was another big career moment for me. Sybase for those that don’t know was a company started by Berkeley faculty and alumni, Bob Epstein. It was at Emeryville at the time. They were going through a really tough time. They were one of the hot relational database companies in the mid-eighties, along with Informix and Engross.
[00:13:13]At Oracle, by the time I got there at ‘99. Oracle had run away with what was considered to be, products at that point, not quite as great or pure as Sybase. But certainly much better distribution at go-to markets and marketing. Now Sybase is, no longer relevant in the database world.
[00:13:34]Sean Li: I have to ask, did you know Maneesh, did you ever run into Maneesh Shaundra?
[00:13:36] Somesh Dash: I didn’t know he was Sybase, but…
[00:13:39]Sean Li [00:13:39] Yeah, he was. He was at Sybase during those years.
[00:13:41] Somesh Dash: I didn’t know that. I may have. I was like 19 and probably not paying attention. But, I did get a chance to see Bob Epstein, who was the first founder. I got a chance to shadow and see. Then I was very lucky that John Chen came in as the new CEO, the year I was there. And I learned a couple of things, which is like the importance of great leadership. I saw how John was sort of building coalitions with these kinds of little things like Friday happy hour, celebrating birthdays. Then, how hard turnarounds were Sybase was at one point. And boy, you could just feel it walking around everywhere else.
[00:14:13] In Silicon Valley, it was like the heyday of the.com movement. And Sybase just felt like the walking dead a bit. And I realized that about myself. I’m not a turnaround person, I’m not enjoying this. So to this day, I enjoy growth more than turnarounds. It takes a person like John. He is probably one of the best CEOs I’ve ever seen, but it takes a different type of skill set to do that.
[00:14:32] And private equity and buyouts well versus being venture growth-oriented. and. It was the summer of 2000, the last year before I graduated, I did an internship. It was at a company called hello brain.com. It was a B2B marketplace that was trying to essentially say, if you to do a project and engineering project, we will find developers around the world who could bid to do that project for you because you don’t have enough engineers at your own company. And then, you pay them and we take a cut. Great idea. It’s the idea of exchanges and outsourcing.
[00:15:03] Sean Li [00:15:03] Yeah.
[00:15:03]Somesh Dash It was over 20 years ago. The challenge was, a lot of the companies figured out that, “Wait a minute, once we meet these great developers sitting in India or China or the Philippines, we can just keep doing projects that we don’t need to keep going back to Hello Brain”. So the company lost its ability to have a resonant take rate as the maker. Because of that, they lost leverage and they were overhired. It was sort of a classic, hypergrowth to flame out the story quickly. But ironically, it was an okay venture-funded company.
[00:15:31] So Excel and Redpoint, which had just formed and was a spin-out of IVP. That was years before I join them. That was my first exposure to VC. The other thing that was formative for me, Sean was, I can remember it like it was yesterday. Laura Tyson because of who she is and her network, invited these amazing speakers to campus. It was sort of a great time to be a fly on the wall in the late ‘90s, early 200s. So I remember sitting in hearing Robert Ruben, Alan Greenspan, all these, Jim Wolfensohn from the world bank. Then there was one moment that stuck out to me. I was finishing accounting class when a guy asked me for a quarter and he was on crutches.
[00:16:11] And I said, “okay”. And I had a quarter and he said, “thank you so much”. He’s like, “I can’t repay you, but I’m giving a talk if you want to come to the auditorium you can listen about venture capital”, I said “okay” and it was John Doerr, sitting in that room. Listening to John present and do this talk. He had just gotten through the Netscape IPO, the Amazon IPO, and he was talking about Google. They had just funded the series. They have this exciting search company out of Stanford. Look how they broke all rules to do it with great evaluation and speed. Now in hindsight, it seems like, “Wow, could you imagine getting 17% of Google today for like $8 million or something”?
[00:16:48]But that was when I said, this is such a unique career path. Where you get to work after you invest collaboratively with these founders and their teams. And I always liked this idea of, one plus one equals three, can you help catalyze others? Can you be the quiet, but influential force behind that founders to get to their potential or their promised land? I think that had formed even back then as a keynote interest. Then I realized it’s pretty much impossible to get hired into venture capital. So I took all kinds of interesting routes to get there. Just to give you a sense of the times, investment banks were doing well back then. It was the heyday of the tech IPOs in 2000. So I went through a process in my senior year, realizing I don’t want to work at a startup right out of school and talk to a couple of banks, talk to a couple of consulting firms. I got recruited by Accenture and their strategy group and was all set to start. And then the.com bust started. They missed earnings and they deferred all of us for a year. At the time I thought, “Oh, this is my life is over. I’m deferred for a year. I would be behind and all my peers are going to be starting their jobs at Bain, McKinsey, and Goldman.” And it was the best thing that ever happened to me.
[00:17:59] Accidentally, because I thought about what I wanted to do. I decided I wanted to go back to India and find a way to work and live in India for a year. Thinking it would just be a great chance for me to, spend more time with family. Understand India, better. Get international work experience. I got to go work for Sony in India. Sony, we know it more as an electronics business in the United States. But in India, they run the second, at that time, the second-largest cable network behind Star, Which was owned by Rupert Murdoch. And I got to go there and be kind of the young gun hired to do Business Development and Corporate Development. I got to work with the CEO directly. The projects range from the acquisition of the ICC world cup cricket rights. This is for someone who never grew up playing cricket or watching cricket. I learned everything about cricket. India is obsessed with cricket. As you probably know already, I did some acquisition of a bunch of digital assets and doing an online film festival in 2002. I was doing a bigger project on television rights and sort of, cashflow modeling.
[00:19:03] And finally, my interesting last project was India had gotten its first nominee to the foreign film category. I think it was like the second ever. It was the first in 40 years. It was a movie called Legon. And, it was about, ironically, a group of Indian villagers who learned how to play cricket so that they could beat the British out of their village. The last project was that Sony owned the rights to international distribution rights and it got nominated. There was this interesting, dilemma where my boss said, “Hey, the guy who, is starring in this movie and produces movies, like the Tom Hanks of India. His name is Amir Khan. And he’s going to be in L.A. for eight weeks trying to do an Oscar campaign. The Sony guy doesn’t know who he is and how important he is to me. They’re not going to resource appropriately. Can you just go out there and help with his Oscar campaign”? And I was like, “okay”. So I moved and lived in the Culver Hotel (where Dennis Haas lived) for the campaign. And it was in some ways the culmination of my familiarity with both cultures back to where we started, Sean. I grew up obviously in the U.S. I still had friends. A lot of friends in L.A. who went to Cal. We’re at UCLA with my high school. And yet, I also had been familiar with India and grew up watching Indian content. So it was a great experience. The movie didn’t win, but I learned a lot from that experience. Then, I came back to the Bay area. Attempted to do an incubator that kind of was YC like. It’s been thought of before YC came out. It didn’t work, but I learned a lot in failure that was in some ways more meaningful than some of the success stories.
[00:20:36] And then, I ended up actually in investment banking, working for CSFB tech, which was run by Frank Quattrone and George Boutros. Who now who runs Catalyst. I got a real education about corporate finance in Silicon Valley and then that’s how I met IVP. I was working with a few companies that IVP was a major investor in. Including aspect Communications, Concur, Polycommon, and Netflix. I a got chance to meet my partner, Norm Fogelsong. He said, “Hey, we just raised a dedicated thing called a growth fund. We don’t do early-stage Do you want to come on? We’re going to hire a senior analyst” This was February ‘05. And I said, “Sure, I’ll do that”. And so that’s how it all started.
[00:21:15] Sean Li: What prompted the MBA when you’re already in venture capital?
[00:21:20]Somesh Dash [00:21:20] Good question. It wasn’t for me as logical a step as it was for others in my class. I didn’t know, Sean, admittedly, if venture was a good fit for me when I got in. I certainly had interested, but I didn’t know if I’d be any good at it. I think I’m decent, after 16 years, but it’s still hard to know sometimes. It’s like the reality check that hits you every day when you see the ups and downs. It’s something else. I realized though when I interviewed with a few firms, that for me growth was really interesting because I think you can utilize this analytical framework. I learned through being a student at Berkeley, working in Corp Dev at Sony, and especially through the investment banking training I had, but it was still venture.
[00:21:58] I think a lot of people thought growth was about you plugging in numbers in a spreadsheet and it pops out the answer. But when I started working in IDP, I realized how much time was being spent on the team, on the culture, on the market, and the strategic framework for the business model versus just the numbers. And that was to me, so much more exciting than just a number-crunching exercise. So I found, I love the business. I love the firm. I love the people and the culture that had been built over the 20 years, 25 years before I got there, and had been, sustained and even strengthened multiple generational transitions.
[00:22:32] And I wasn’t sure if I should go to business school or not. So I decided to apply and, really in my mind I thought,”. And, you know, to give my partnership, a lot of credit, they encouraged me to go because I had been fixated on the question, “Is this a near-term catalyst to my career?” And what I learned from talking to my partners, with Ben, or alumni, is if you can find 10 to 15 meaningful friendships in these two years, that is worth everything and more cause in life it’s so difficult. To be in an environment that I should create meaningful lasting friendships and relationships, I thought, “Okay, if I could, I have my college friends, my high school friends, if I could meet some amazing people, that’s probably worth it. I found that a lot of people say networking is the reason to go to business school.
[00:23:20]I didn’t find that to be the case for myself because in venture, being from Cal growing up in Silicon Valley, you do meet a lot of people. The word networking to me has a quantity, kind of component to it. And I found that it was less important for me to just meet everybody. But, I found that in the meaningful relationships I had with a subset of my class with members of the faculty lectures, that just meant the world to me.
[00:23:43] And I also knew in my mind that I wanted to come back to venture. I did have the chance to be a part of a few, startups, including one called Identified that was eventually acquired by Workday. And the two founders that started Base10 and Fifth Wall. We have gone on to do amazing things. We continue to talk all the time. I think those entrepreneurial experiences were great for me. I realize that I love startups, but I am much better probably than an investor. Co-founder scaler. think everybody at some point or another has to admit that they think, well, what would it be like to be an operator?
[00:24:16] So I give it a shot. And learned I was decent at a couple of things but pretty bad at others. I have a world of respect. It certainly builds way more empathy when you try to go through it and you fail multiple times a day on multiple dimensions, you realize how hard it is. I think I had taken some of that for granted in my early years in venture.
[00:24:34]When I came back after business school I was in awe of the fact that some of these companies could get to where they’re going. I just it’s so freaking hard. And you try to do it yourself.
[00:24:45]Sean Li: I want to ask you a question about something that you had briefly mentioned earlier, hearing how you’re talking about growth, investing, About teams, culture. To you, how does that differentiate from turnarounds? Because isn’t that typically the problems in those distress situations?
[00:25:03]Somesh Dash It depends on the market. What I saw at Sybase for example, was a complete reboot of the strategy at that time. They had to look into the tools, business, different distribution deals to even stay relevant as they were losing their share rapidly to Oracle, IBM, and others in the space. Growth is, more about optimizing for a market evolving or the future. Almost by definition hyper-scale, so growth could be anything. From like growing 1% to growing 1000%. Right? Depending on the scale, what’s important to ask is what growth is sustainable versus, one that just comes and goes. So I would say a lot of the work we do is asking, “Okay, what part of this growth is sustainable? And then are you growing in the right way to create shareholder value for everybody involved? Not with like the lens of the next quarter or two, but the next three years, five years, 10 years. And you do see certain patterns emerge?” I’m certain we’ve done a lot of work in enterprise software and consumer and mobile internet, and more recently digital health. You can see certain things, emerge as common themes. But even 16 years in the markets are so dynamic Sean, they changed so much, That it’s actually.
[00:26:12]Collaborating with founders to ask the right questions together versus saying, “I got the answers. I’m going to tell you what to do”. That does not work. There’s an old phrase my professor Mark Leslie said that I always come back to, which is, I tell this to every founder I work with, “If you don’t listen to your board, you may get fired”. I think the best investors that I’ve had the privilege of working with, are fantastic sounding boards. They’ve measured in the quantity the comments they make. They’re supportive and they have a nice way of figuring out each founder’s idiosyncrasies and knowing how and when to have those conversations. That’s the art. It’s not a one size fits all strategy. You can’t be in the same mode with everybody. Some founders respond better to sort of. In-person, rapid whiteboarding iterations. Some are better, kind of in a much more methodical. I’m gonna send you questions. Let’s think about it together. And the talk and that’s fun for me. I found as a young kid going to India, I realize, there’s just so many personality types in my own family. I was always a bit of a pavilion. I loved to adapt to new environments that helped me almost more than anything. In venture, there are different styles of different founders, in different stages and different egos.
[00:27:25] Even within my partnership, different styles. And a of it is consensus building with my firm saying, “Okay, let’s do this”. Some of my partners are just better at talking one-on-one live, some are better over email. I’ve figured it all out, not all of it, but most of it in over 16 years. I think there are some fundamental differences and just like what you need to do. I also think what’s important in most turnarounds, especially private equity, a sponsor typically has majority control, right? So it’s a very different orientation. If you own more than 51%, right? The outstanding shares at that point, you are kind of helping control your destiny in venture. And if you’re a series investor and you’ve got amazing equity ownership to start with, and you’re in the 20, 25%, you’re still a minority shareholder. And so you don’t have control. Your job is to be a sounding board and an amplifier to management and to build consensus with the other directors.
[00:28:18] I think a lot of problems happen in venture, in the 2000s when people thought, “Okay, I own 5%, this is my company. I’m going to tell you what to do”. That’s usually where things go wrong. I think for us, we’re just so lucky to partner with these amazing founders we had. Last week was exciting. We’ve got Coinbase, which was, a remarkable event, for the firm. Just this morning, the IPO was passed which is another amazing company in the enterprise software space, in the RPA space. We were certainly helpful and there was a lot of work that went in. But, all the credit goes to the amazing management teams and the founders of those companies.
[00:28:55]Sean Li: Absolutely. I do have this burning question of why did John Doerr need a quarter?
[00:29:02]Somesh Dash: I asked him this when I met him, maybe it was 10 years later. We had a chance to work with John and his amazing team at Kleiner. Several co-investments and a number of my partners have known him for many, many decades. He didn’t tell me who he was calling, but he was using a payphone. He was covering his mouth, which I also found interesting. It was when mobile phones kind of look like bricks. I think he probably worried he wasn’t on a secure line. I think he said something like that. But, another thing I feel very lucky about was I was able to do early, get to be on several boards and, interact with some of the investors of our industry. I always tried to see what was like the superpower of each of them and see if you can adapt some of that. With John, what I thought was just so amazing is his ability to tell a compelling narrative. Like he would always within a few minutes, tell you this compelling narrative about the company and where it’s going. That was so memorable. Sometimes you could hear a whole pitch from another VC about why they’re excited about a company. You don’t remember anything. John in 30 seconds would give you a couple of things that you’re like. I still remember today from the companies he talked about. Part of venture more than ever now is storytelling.
[00:30:15] It’s storytelling to the entrepreneur about who you are as an individual or as a firm, and why you could be a great partner to them, especially for competitive rounds. It’s telling the story of the company to outside stakeholders, whether it’s trying to recruit, or board members trying to help with customer acquisition, trying to help with the public market’s story. I mean, a lot of what you do is becoming some sensitive Angel for these companies. And I think in all these years, John’s superpower is still just being able to tell such a fantastic, abbreviated version, a kind of story that resonates with the audience.
[00:30:50]Sean Li: I want to transition a little bit into, your investments in the mental health space. Can you talk a little bit about that?
[00:30:56] Somesh Dash: I’ve had an interest in the mental health arena. Well over a decade now. And frankly, a lot of this also goes back a bit to Cal. I didn’t have the lexicon back then to understand what it was like to go through those classic challenges of being a college student in a large public university. That’s high pressure. A lot of the type of people I didn’t even know. There was a thing called mental health, in the late nineties, I just wasn’t as familiar with it. I can also say this to you, Sean. I think coming from immigrant families, it’s not something you talk about with your parents. It’s not something that’s encouraged in your diaspora. Your community, therapy was not viewed positively. And I lost a friend who I was close to at Cal. Years after Cal and, in hindsight, I realize a lot of the signs were there in college. True mental health issues along with addiction issues and a few other things. In my friends’ circle, as we talked about that experience, I realized there’s just so much unknown still around the mind and the connection between the mind, the body, and behavior. And I was interested in it. I, of course, like most people have gone through my spectrum of mental health issues, throughout my life.
[00:32:09] And I think, it got me personally very interested and also from a business perspective, made me realize that with data being much more ubiquitous now. And software being able to do things that’s performative that was unable to be done, in the analog world 20 years ago, this might be the time to look at the sector, something fresh. I’ve made two investments. I’ve met about 50 companies over the last five years in this space. the first was a company called Thrive Global. it was started by Arianna Huffington. Who’s a very well-known author and entrepreneur, founder of the Huffington Posts. She had gone through a situation where she hit rock-bottom fatigue in 2007 when she was running HuffPo. She realized that sleep and sort of wellness are things that are stigmatized among entrepreneurs. People sort of celebrating in Silicon Valley. The idea of being overworked and sleepless, which leads to overtime, negative consequences, not positive consequences for decision-making and company building. And so I was fascinated with the way she took on this problem. I met her in 2017 and the company today is a SAAS solution that sells to large enterprises, the mental health dashboard. It’s a combination of content, as well as notifications and behavioral recommendations to enable people to not just sleep better, but also look at upstream. All the things they can do in their lives to be healthier and happier while increasing their productivity. I think the key thing for companies is, they want a healthier employee population, but they also want it to be, helping the bottom line. Research shows that if you have a healthier population, people who get sick less deal less with depression, which leads to better company outcomes. It’s just, it’s like diversity. It’s just better for the company as well. So that’s unassailable right now.
[00:34:05] The second investment I made, which was just before the pandemic was a company called Lira health, and the founder of that company, David Hebrews man is an incredible operator. He was CFO of Genentech and Facebook when they were both public companies. Had his journey, where he realized mental health was something he wanted to focus his career on. And Lira’s model is actually to provide, a marketplace of therapists, to employees of large enterprises. It had incredible growth because what they found was so many large companies don’t have therapists covered in health plans and finding a therapist is hard. Having that therapist covered is hard. And it’s interesting if you think, I remember he said something that resonated with me, he said the fact that we can pretty quickly have, vision dental, and health cover, the mental health just doesn’t seem right. It seems like that’s something that’s just as important, if not, more important than those other three categories. And, he’s out on a quest to solve this problem, has built Lira and a pretty amazing company. And then, the pandemic hit. And what was amazing was the needs of people to get help, actually increase, not decreased with the pandemic. Yet physically you weren’t able to go and see therapists. So they had built out a telemedicine platform that enabled you to do online coaching and therapy sessions. Also, most of the companies, introduce it and provide it for their spouses and partners, and children. We have entire families of some of the large customers who are using, Lira as a platform to get help.
[00:35:25] And it’s amazing, especially because the spectrum is like some people, need coaching and some people have more severe issues. Especially during the pandemic, which had been accentuated around suicidal thoughts, addiction, issues around abuse. For those of you’d need to have partnerships with, specialist providers, whether it’s health systems like USCSF, Kaiser, or Stanford. It’s been a great journey. And I think this is still the early days of mental health startups. I think one thing, that’s important to me is the combination of great clinical outcomes. Along with more community grassroots awareness and conversation. You need to have that. You can’t do one without the other. So both of these companies take slightly different approaches when they have gone into this space.
[00:36:13] Sean Li: Curious to hear what your thoughts are on Ginger. As a Berkeley founded start.
[00:36:17] Somesh Dash: I think it’s fantastic.
[00:36:19] Sean Li: We’ll, you got to visit them.
[00:36:21] Somesh Dash: I will profess I’ve only had a few interactions with them, but the founders are remarkable and I think the vision is fantastic. I think they’ve done a great job of de-stigmatizing a lot of things that we’re not talked about. But they pushed nicely on this idea of coaching and therapy and I think if I had to summarize what was the most impressive? They’ve made it relatively frictionless to do something as a newbie to kind of think about mental health and therapy. I think that’s fantastic. McKinsey published a report recently that shows a clear link between lifestyle diseases and mental health. So whether it’s hypertension, diabetes, all the things that are silent killers of our population. If they don’t get all the attention that other more, non-lifestyle diseases get, I think, solving this is going to be one of the big challenges and opportunities over the next decade.
[00:37:11]And I think coming out of the pandemic, I think people are going to want to maintain some of the good that came out of this virtualized world, which is being able to like to slow it down. Think a little bit about what’s important to them or not. Get the help they need. I think the reality is we’re all seeing every day in the news, examples of breakdowns in our public health infrastructure that are leading to some of these massive societal issues. A lot of things are related to mass shootings, violence, and communities. The root of it is community health and mental health. And unfortunately, the system hasn’t modernized in the way that science has or that the private sector has. So I’m bullish that entrepreneurs, startups, and growth companies make a real difference while doing it in conjunction with local state and federal governments.
[00:37:59]Sean Li: There’s a couple of things there I want to unpack and revisit. I’ll start backward. It’s very interesting, you talk about when people ask me about violence against Asian Americans. I don’t know why, and I don’t mean to play down anything, but in my mind, I never jumped a fear, as an entrepreneurial mind.
[00:38:17] Maybe it’s just, you know, what is the problem here for us to solve? Because it’s solvable. And the first thing that I always think about is, “What are they going through? Why are they doing this?” Asking kind of the classic Toyota five whys. One of the things that I recently read was an article talking about how there’s a word for what we’re all experiencing during Covid, and the word is Languish. It’s losing or the lack of fatality, growing weak or feeble, and it’s an effect of isolation. I remember reading too, that people can feel isolated in more ways than one. You can have physical, a lot of physical connection, but still, have that mental isolation. I thought it was really interesting. We were talking about the Asian diaspora because some advisors recently were just telling me to look into Asian, founders’ funds and to just tap into that. My co-founder, he’s Indian. So to look into South Asian publications or, publishers for PR, I just never thought to do that. Why are we like that? Why don’t we tap into our circles? Who are our networks? Our people? There’s just something ingrained to just not do that. Similarly with mental health, it’s just not spoken of.
Somesh Dash [00:39:32] Well, a couple of things, like we could talk about this for a long time, but what’s interesting to me is from the perspective of people who aren’t as familiar with, let’s say South Asians or, Chinese Americans. You’re put into this broad bucket of you’re Indian. Right. And I think you and I both talked about this interesting thing. India itself is such an aggregation of so many different religions and subcultures, languages, and subcode. China’s got the largest population in the world. There’s going to be a very big difference betweenWith thein talking to someone who grew up in the agrarian, in the Guangdong region versus someone who lives in an urban environment in Shanghai or Beijing. There are huge cultural differences I’ve seen in my friends, depending on sort of what paths their families followed. Whether it was in China, those that were Taiwanese-American have a different orientation. So I think those are idiosyncrasies that frankly, I blamed the education system. Well, I grew up in the Bay area, which is pretty much as cosmopolitan as it gets in this country.
[00:40:30] I remember the shock I, I had, I was very excited when I think it was my sophomore year. We were doing world history and I said, “Oh, this is gonna be great! I can talk about India and learn about China”. In that nine-month course, we spent one week on India and one week cut and tried it. And the vast majority of it was skewed. The curriculum was skewed towards, you know, the heritage of Western Europe. Right? Because a lot of that comes from the education system, being put together by those people that were immigrants from a certain part of the world. And I just found it fascinating that my classmates came out of high school in the Bay area, not being able to point on a map, most parts of India or China. And not knowing anybody who was prominent, besides maybe Mahatma Gandhi or. I think that is a failure of the system to do that.
[00:41:16] I look at my kids’ generation. I’m much more optimistic because there are so many supplementary tools out there now, especially online that enable your kid to learn about the rich history of Asia, Africa or, native American cultures even here. I think part of that is just ignorance. Part of it is Hollywood also always looks for the other as the villain. So there’s some good literature on this in the eighties, it was sort of Russia in the ‘90s, it was the Japanese cultures. If you grow up watching a ton of media, which everyone does, you have implicit biases that form. Popular media needs to take more responsibility for that and not say, how did this happen?
[00:41:53] Well, I can tell you what happened like $200 million blockbuster films that were made, created the other. And many of them were people from our parts of the world. and then you don’t celebrate those that are creative artists, that, make great movies and sort of honor that with Oscars and Golden Globes, and things like that.
[00:42:10] So I think that’s part of it. I think the biggest thing though, is we’ve always, our communities have always tried to be the model immigrants. Think about our parents’ generation? They came here with USD 10 to USD 15 in their pocket. Most didn’t come from affluent backgrounds back home. They weren’t the best of the best. They came here just to get a shot to rise from the bottom of the economic poll. And they didn’t have any, they didn’t have a lot spread as I call it. Meaning they didn’t have a lot of free time, extra cash, like godfathers’ resources. So those of us that grew up in those families, you know, education was the focus. It was sort of like you put your head down and you crank, which is such an amazing theme.
[00:42:47] That’s why you see the massive success of the South Asian community and the Asian American community. But it came with a price. The price was, so much so unsaid, so much was not discussed. And that led to communities that are under-indexed on having the real conversations that are happening now. That makes it so special that our kids aren’t going to have what I want our children’s generation to have. Therapists on their phone on speed dial that they can talk to because sometimes there are things you just can’t say to your family and your siblings, your parents, your siblings. I think our parents’ generation would need it as well. Because what we don’t understand in our age, is the isolation and loneliness you talk about is amplified about five. If you’re older and more vulnerable as a population. I’ve had conversations, I’ve seen many of my parents’ friends, get between withick pass away in the last year, directly through Covid or Covid related illnesses. And that’s hard when you lose these relationships, you’ve built over 40 or 50 years. You can’t even go to a funeral because of COVID protocols.
[00:43:45] So I’m a combination of sad and upset over sort of how, how it’s gotten to this. It’s been happening forever. It’s just, there’s more awareness on it. Now I’m just such an optimist. People are good. People do want to do the right thing. The outpouring of support for the AAPI community, which my firm and I individually have been a part of in the last few weeks has been amazing. I do think, political organizing is going to be the key. If you think about it, learn from, Hispanic, American communities, organizations like the NAACP. They have helped make progress over decades, not weeks and months, around policy, both federal and local. I think that will be the equivalent of those built for the South Asian community and for the RP community as a result of this.
[00:44:26] And I think if you could take, the grade resources and the energy and the dedication of the immigrant communities. Going on Twitter and going on social media and expressing outrage is ot going to solve the full problem. It’s an important first step, but political action and collective action is the way to do it. Berkeley has such a heritage of doing that from the inception of the university through the sixties. That’s part of the reason I was so excited to be there. I think Cal will play a big role in this as well. Given the rich heritage of integration between different racial and ethnic groups.
Sean Li: So speaking of community and you talked about community grassroots conversations. It just makes me think, you know, a lot of these mental health issues, again, as I said, stemming from, isolation, right? Feeling alone. Even when you’re surrounded by people, it makes me wonder how social media and technology have driven us further into this? And how now, we’re looking at, especially compounded by Covid, how do we evaluate? How do we look at technology to climb out of that? How do we not continue going down that path? This was one of the reasons why I’m so passionate about podcasting because I think just hearing people’s voices, hearing perspectives is so important. Important than just getting a five-second clip of something. Hearing this 40-minute conversation. I’m really curious to hear your thoughts, being in Silicon Valley, on how we can tackle this.
[00:45:52]Somesh Dash: If you go even into the earliest days of, technology innovation, think about Robert Oppenheimer in the Manhattan Project. There was a view on what is nuclear energy. How do you create certain sorts of things? But, if you think about what happened, not that long ago, less than a hundred years ago, in this very region that we celebrate innovation, we had, in tournament camps for certain subpopulations. We had Pearl Harbor and Hiroshima. It just shows you that there’s always a balance between idealism innovation, but also public goods, and public protection. There are massive consequences for just the free market. There’s always this I see a site, I think, “Laissez-faire leave it alone”. Things will just kind of self-regulate to over-regulating and then trying to apply laws that should have been there a long time ago.
[00:46:43]I think we’re right now kind of moving into a period, especially nationally, catch-up regulations. I think that’s warranted. It’ll probably have some adverse consequences where it’ll go for kind of the symptom versus the disease. And there’s going to be things like, Oh, a hundred billion dollar companies shouldn’t buy anything. Why? Right? He asked the first principle question. I think what they’re after is not letting any company that’s not government regulated have too much power. But then you’re not solving that by saying anything that happens to be valued over a hundred billion, you can’t make an acquisition.
[00:47:15] This is one of the proposals up there right now. So I would say, you started with this audio platform, which is a really powerful thing. I think, 15 months or so into the pandemic. I think we all see some benefits from slowing it down in terms of the amount of time we spent in rush hour or away from our children or our families, but, human interaction. I mean, friends and family, these are things that matter more than, anything else. And so I’m optimistic about the audio factor. I think we’re going to see new platforms emerge that feel a lot like iOS and Android. Did that feel a lot like the original generation of internet companies did? I think the amount of data and emotion that you can capture through audio is much larger than people realize. What hasn’t been done yet is to make it searchable, curated, or personalized. And so you can imagine we’re investors in Dicsord were falling what’s going on at Clubhouse.
[00:48:11] I think some amazing new platforms are very innovative, that are coming out and we’re in the early, early days, it’s kind of like web 1.0. Oh, in terms of audio. I don’t think Google, Amazon, will acquire and certainly launch their Clubhouse killers and Discord killers. But I think there’s going to be independent companies that do it differently. I think these founders today that I talked to don’t want to just follow the path of their predecessors from the social media companies. They want to do it differently. They have to do it differently. I do think that there’s going to be so much great content created and, I think people now are at a point where it’s not as much about an advertising business that maximizes the monetizing reach. It’s more about deeper, meaningful engagement when there are so many distractions on your time. Subscription models, enable you to do that in some ways. So I see that as being much more of the business model of the future.
[00:49:01] I think 10 years from now, there’s going to be multiple 500 billion to trillion-dollar market cap companies that are subscription-based, audio-centric models. And I think, you combine that with IoT sensors, machine learning, AI, and it’s pretty much limitless what could end up happening.
[00:49:19]Sean Li: Yeah. I was just reading about Neeva the other day.
[00:49:22] Somesh Dash: amazing companies Sridhar Ramaswamy always one of the most intelligent, entrepreneurs I’ve met. He’s a legendary person. He’s rethinking search, This is from the guy who built a lot of it at Google.
[00:49:31] Sean Li: Yeah. All right. Wrapping up questions are with these, fire round questions called what are some books that you’re reading recently, or some content?
[00:49:40]Somesh Dash: Yeah. I got some good ones. So I just started reading No Rules, Rules. It’s about Netflix by Reed Hastings, which I thought was good. I read a great book that Eric Schmidt co-wrote on Bill Campbell. I think it’s called Billion-Dollar coach or Trillion-Dollar coach. I can’t remember,
[00:49:55] Sean Li: Yeah.
[00:49:56] Somesh Dash: That was a very formative one for me because I had the opportunity to meet Bill a few times. I did not work with him closely, which is a huge regret, but I do work with several entrepreneurs who have been mentored by him. I think, watching him influence so many amazing companies along the way in his own understated, quiet behind-the-scenes way. It kind of goes in the face of a lot of institutionalization investing. I took a lot from that around. How do you think about organizational design culture, catalyzing teams? How do you deliver feedback? And I just think he really was one of a kind and, left too soon. I think his legacy is intact with many of the founders that he mentored, like Ben Horowitz, Dick Costlow, Larry Page, Sergei Brin, and others.
[00:50 But I think, there’s a lot of learning from that that I’m trying to apply in board conversations and CEO interactions. So that was good. Then I started reading some fiction last summer during this pandemic, which I hadn’t done in 20 years. I read some good Indian American authors, this one book by Madhuri Vijay, which was good about, Kashmir, which was fantastic. One of my regrets is I haven’t been able to read more with a young family and with a crazy work schedule, but that’s kind of, my dream is like enabling myself to have the time to read a great book every week would be fantastic.
[00:51:12]Sean Li: Well, thank you so much for coming on the podcast. It’s been a real pleasure, Somesh looks forward to having you on again sometime soon.
[00:51:18]Somesh Dash Yeah. Sean, thank you for doing this. I wish when I was a student or recent alumni that I had a chance to listen to podcasts and hear people’s stories. I think the work you’re doing is going to have posterity and people are gonna listen to it for decades to come. And I mean, this is the kind of stuff that certainly builds. So I’m just really glad you’re taking so much of your time to do this. And I think a huge debt of gratitude is owed to you by everybody from the Cal community.
[00:36:21] Sean Li: Thanks again for tuning in to this episode of the OneHaas Podcast. If you enjoyed our show today, please remember to hit that subscribe or follow button on your favorite podcast player. We’d also really appreciate you giving us a five-star rating and review. If you’re looking for more content, please check out our website at Haas dot fm. That’s spelled H-A-A -S dot F-M. There you can subscribe to our monthly newsletter and check out some of our other Berkeley Haas podcasts. And until next time, go Bears.