True Ventures: Innovation Through Investing

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Christiaan Vorkink first became fascinated with the world of computer technology during his sophomore year at Yale when he took a class called Computers and the Law in 1996—the height of the dot-com boom. “The existing legal world was being forced to adapt to this cool, new medium which had never before existed,” said Vorkink, “it was the best class in my four years of Yale.”

More than a decade later, he now works at True Ventures, a venture capital firm that focuses on supporting the needs of early stage entrepreneurs. He joined the company in 2008, after his four years at Yale (where he ran the Branford website and taught himself to code in the process) and after working as a senior analyst at the venture capital research group Cambridge Associates in Boston.

Vorkink joined True because the model of “more venture, less capital” really resonated with him.  The company takes bolder risks earlier, writing small checks to teams of two or three entrepreneurs — or “Founders” as the company refers to them —who have the beginnings of an idea, and help them transform the idea into reality. “Our focus is starting something from nothing, from an idea that no one else has done,” says Vorkink, “ to do something that is fundamentally different and fundamentally risky.”

Although True Ventures starts small, it does not think small. Starting small, with less capital,allows room for greater creativity and more opportunities for creating higher returns. “Sure, lots of our investments will lose all of our money,” says Vorkink, “a certain subset, however will be very successful, we hope. Phenomenally successful. And they will produce a return that will more than compensate for everything lost.”

As someone who enjoys teaching and believes deeply in the significance of education, Vorkink is also drawn to the uniquely people-centered approach of the firm. In their process for selecting Founders to work with, the company does not have a checklist or explicit formula to go through. “It’s a very human oriented process, and qualitative analysis,” Vorkink explains. “There are few numbers to crunch.”

A crucial requirement that they look for in their founders, is enthusiasm. Vorkink says he looks for passion and conviction. The typical client they seek out, are  “people who want to start a company because they are so focused on solving a particular problem, because they can’t notsolve it.” These type of people not only usually have a deep domain expertise in the realm they are trying to create a start-up in, they are most likely to carry an idea through all the way.

This people-oriented approach is reflected in every aspect of how the firm functions. When looking for and recruiting new founders, True Ventures rarely spends time at conferences and trade shows — most of the investments that the company makes were referred to the firm by people that they already know well. The core investment team itself, which consists of ten people, is relatively small. A typical day consists of a lot of talking with one another, talking to the investors, gauging and soaking in their ideas.

“It’s not a sit behind a desk and wait for things to come your way kind of job,” explains Vorkink. “You have to be connected to the best people with the best ideas, you have to be part of the conversation. You don’t get that by sitting back. There is no typical day working at True Ventures. Although on Tuesdays, the investment team meets as a group all through midday, everyone is out of the office on Monday, Wednesday and Friday, busy absorbing new ideas.

In this kind of work environment, the two qualities that a True employee must have is, according to Vorkink, a “combination of optimism and empathy.” Optimism is important, because “if you work in our business and your are fundamentally skeptical, you won’t make many investments,” says Vorkink. “The empathy is important too because when these single founders start businesses, they are by themselves, and need somebody to talk to, bounce ideas off.” Openness, candor and the ability to community thoughtfully and empathetically are of vital importance to create strong working relationships with the Founders, and therefore the future success of their startup.

Timing however, is of course, an important factor that distinguishes success from failure. “There have been lots of great ideas that haven’t worked out because of market conditions.” Vorkink raises as an example the startup Webvan, one of the largest dot-com flops in history. Webvan, headquartered in Foster City, California, was an online “credit and delivery” grocery business that went bankrupt in 2001. “It didn’t work in 1999 because the infrastructure simply wasn’t there and the business was too expensive,” says Vorkink. “But fast forward to 2012, and now there’s a company here in San Francisco called Instacart, that’s doing well because the conditions are now in place — everyone has a mobile phone, and there is a labor force much more attuned to specific tasks.”

Although you can’t, as Vorkink states, “control luck and good fortune,” what you can do, ultimately, is to cultivate deep relationships with your clients. It is this combination of teaching and innovation that has always appealed to Vorkink, and forms the crux of True Ventures mission as a firm.

In fact, since 2009, True Ventures has been running the True Entrepreneur Corps (TEC) program, bringing undergraduates from across the country to the San Francisco Bay area to spend the summer with their portfolio companies and learn firsthand what it is like to work at a startup. These however, are not just summer internships. “A TEC fellow will sometimes end up being part of a company that we fund in the future,” says Vorkink. “This is about nurturing an entrepreneurial community, about inspiring the next generation of entrepreneurs. Who knows? In a couple of years, they could be running a company that we decide to fund.”

Yi-Ling Liu

Yi-Ling Liu is a sophomore in Silliman and an English major. Aside from writing for the YE, she is an editor of the publication China Hands, writes for the Yale Daily News, and works as a student gallery guide at the Yale University Art Gallery. She loves film, café culture, running outdoors, practicing yoga (mediocrely) and books (both reading them and gushing over beautiful dust jackets).

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