Startup Management, OMER Ventures, Ryerson Futures, and OneEleven jointly sponsored a conversation with Albert Wenger, partner of Union Square Ventures in from New York City last week in Toronto.
With over 300 attendees, a live DJ, and delicious food and drinks served, a full house of eager listeners readily settled into the evening and listen to insights of a seasoned venture capitalist, working with big brands scaling in the marketplace. It is clear that Albert is a futuristic thinker and views the world on another level when it comes to innovation and the changes he sees taking place in how systems operate.
His firm, USV, focuses on investing in disruptive companies that have a network effect, which is not limited to any industry. Their portfolio of investments to date include: Twitter, Tumblr, Foursquare, Etsy, Kickstarter, Wattpad, Kik and Shapeways. Firms that have network effects have value that expands for all members as others join. An example he gave was search engines, they get smarter the more people search for certain topics. He also referenced financial institutions, when there are more lenders; there is more value for the borrowers.
Growing up in a village in Germany, Albert was interested in computers from an early age. He went to college in the United States and graduated from Harvard with a focus in economics and computer science and went on to get a Ph.D. from MIT in Information Technology.
When asked how he came to be a VC, his response was “By making many mistakes." He mentioned one of his earlier experiences failed after raising venture capital and being sued by a bigger well known company. “It was an interesting experience," he quipped. Stressing the importance of experimenting early and often, he explained how the journey to get from experimenting to funding and scaling can take a long time.
Albert cofounded five companies in total and was the former president of del.icio.us before the company was sold to Yahoo. Today, Albert now sits on 11 boards and says that having a full schedule enforces discipline. He believes all companies face similar issues and works with entrepreneurs to help them remove the one thing holding them back, whether it is the next round of funding or building a team. Albert also mentioned that it is very important for entrepreneurs to understand themselves and their weaknesses and he sometimes has to be subtle when trying to influence the entrepreneur or give advice.
When talking about the VC landscape in Canada, host William Mougayar—venture advisor and founder of Startup Management—mentioned that of the $500 million of Venture funds that have come into Canada over the last year, half was from the US. Comparatively, New York City can have $200 million in one month so Canada has a bit of work to do to develop venture capital for Canadian companies.
He compared the tech environment of Waterloo to Silicon Valley and Toronto’s ecosystem to New York City. He believes the close proximity and synergies can really be viewed as one complimentary ecosystem which has a lot of opportunity to expand and grow in Canada.