According to Andreessen-Horowitz’s blog, Canadian mega-angel and founder of Version One Ventures, Boris Wertz is moving on to the $2.5 billion venture capital firm, founded by Marc Andreessen and Ben Horowitz. He’ll join as a board member.
Wertz has done a lot for the Canadian startup ecosystem, including founding Version One, one of Canada’s few consistent early-stage seed funds. He also made a significant investment into Techvibes, a Canadian tech blog, and was instrumental in bringing the Startup Visa program for foreign entrepreneurs seeking citizenship to Canada.
Some of the more noteworthy startups Wertz has invested in include social publishing platform Wattpad, men’s subscription clothing startup Frank & Oak and crowdfunding platform Indiegogo, the GrowLab accelerator and more. All together Version One has 32 portfolio companies under its belt.
Now the investor is heading down south, and Andreessen-Horowitz published a Q and A with him.
a16z: Let’s back up a bit. You are German, how did you end up in Canada?
Boris Wertz: I started an online book selling company JustBooks in Germany in 1999, and we ended up being bought in 2002 by AbeBooks, which was based in British Columbia. I moved out as part of the acquisition to run marketing, business development, and international among other things. I didn’t figure I would stay, but then I met wife, and well, I changed my view on staying.
a16z: AbeBooks was a sort of eBay for hard to find books, is that right?
BW: That’s right. By 2008 we were doing several hundreds of millions of dollars a year in transactions between buyers looking for rare books, used text books, offerings from small, independent publishers, or out-of-print books, and the sellers who had them. We had created an international database of 100 million books, it was the largest selection of books worldwide.
a16z: The Amazon acquisition allowed you to start your career as an angel investor, which you did as a solo-act for four years. In some ways you bootstrapped your current fund.
BW: That’s a good way to think about it. Because companies had gotten much cheaper to build, I was able to do 30 investments as an angel with the proceeds from AbeBooks. I think that period as an angel gave me the confidence in two key areas: my ability to really help entrepreneurs and make a difference in the early stages, and secondly, my ability to really understanding how to invest, and to go out and attract more deal flow. It looks much easier than it actually is, and I can tell you I learned a lesson or two on my own money. But once I had done that, I was able to find a good product-market fit for my fund – just like any startup.
a16z: How does being in Canada give you a different perspective?
BW: I wouldn’t say it’s Canada, as much as being outside of Silicon Valley. I think there is Silicon Valley, and then there are smaller ecosystems in places like New York, Toronto, , Seattle and other places. Compared to Silicon Valley, they all lack consistency of deal flow. That said, great companies do get built outside of Silicon Valley, and there are great opportunities. And this is the interesting thing, when you find an entrepreneur outside of the Valley usually they have this extra passion for what they are building because in some ways they have to work much harder to pull it off. They know it’s hard to raise money. They know it’s even harder to build a company. Yet they are still doing it.
a16z: Are there any advantages to building a company outside of Silicon Valley?
BW: I think the initial advantage is you have much better access to talent when there isn’t like 20 companies competing for the same people. At the same time, the challenge is lack of senior talent. It is actually a relatively easy to build a great company and these smaller ecosystems up to 20 or 25 people. But when you need to hire the first VP of sales, and the first VP of marketing, you often need to start looking elsewhere. So starting companies is one thing, but scaling is tougher outside of Silicon Valley, often much harder than the initial phase of a company.
a16z: Does that often mean companies need to relocate to Silicon Valley?
BW: I think it’s a nuanced perspective. If you end up in the enterprise space, I think you need to relocate to where your customers are. There’s just no way where you can build an enterprise company out of the smaller ecosystems today. On the consumer side you just have to think about what’s best for the company. Sometimes that does mean relocation. Sometimes that means putting marketing and sales in the Valley, but keeping your product engineering teams wherever it is you started your company.
a16z: You see all kinds of startups – in all kinds of places – what’s really interesting to you out there?
BW: The things we’re excited about sit in a few areas. The first one connects to what is going on in the hardware revolution. For us it’s the platforms that support hardware companies. So we have invested in companies like IndieGoGo, Upverter and Tindie. We feel like this is an ongoing trend that is just going too accelerate.
The second area that we are focused on is healthcare. For us it feels like this year is the year where the organization of healthcare with the help of technology is at a tipping point. We’re super-interested in is creating networks of patients-to-patients, doctors-to-doctors, and doctor-to-patients. It’s the idea that we can spread knowledge in a much more positive, efficient way among all the players using technology. Another healthcare trend we are focused on is how to serve up and effectively use patient data. Why shouldn’t I carry around all of my blood test results from the last ten years on my phone to help me cholesterol, diabetes, whatever health concern it may be.
For the entire interview, head to a16z here.
Photo by Financial Post