Monday, May 28, 2012

Adventures in India

For the past 5 years, I’ve made it a goal to travel to at least one new country every year. Not only is traveling to new countries a great opportunity to learn about new cultures, see amazing sites, taste unique foods, appreciate beautiful art and history, but it also provides a great way to get very close to the people you are traveling with, since often times you are put in difficult situations which help you learn a great deal about each other’s personalities and values.

This year my trip to India was one of those experiences I will never forget. We visited five cities over 10 days, saw over 40 different tourist sites, and tried over 60 delicious Indian specialties. My good friend, who I traveled with, summarized our trip best:  "When I think back on the last 10 days in Delhi, Agra, Jaipur, Goa, & Mumbai, I can't help but smile.  A big smile. We saw the breathtaking Taj Mahal and many other beautiful structures, rode elephants to the Amber Fort, experienced the wonderful juxtaposition of tradition and modernity that is India, hiked to pristine beaches, watched snake charmers, took a boat to explore cave carvings from the 5th century, visited bustling temples, were chased by wild pigs, tried many delicious new foods (and some not so great ones!), and learned so many new things about a close friend.”

I’m also grateful that this trip gave me a chance to re-connect with my passion for photography. I’ve always said that if I were to drop everything, then the one thing I would want to do would be to travel around the world taking beautiful photos. Here are some of my favorite pictures in India that will remind me of all our great adventures:

Wednesday, May 2, 2012

Duke and Wall Street

There’s been a lot of press recently about how students from Duke and other elite colleges are still flocking to Wall Street: “How Elite CollegesStill Feed Wall St.’s Recruiting Machine” and At Duke,Wall Street May Still Hold Allure.”

Similar to the author of the first article, I first came to Duke not knowing much about finance or investment banking and had never heard of Goldman Sachs before setting foot on campus. Early on in my freshman year, I distinctly remember an article in Duke’s Towerview magazine called “I-bank, Therefore I Am,”  which initially brought my attention to Wall Street as a potential career interest. I had known one of the students interviewed in the article through my involvement in Duke Student Government and a lot of what he said in the article resonated with me. It’s actually pretty surprising that I can still trace my initial interest to finance back to the upperclassman I had met at Duke and all the articles about Wall Street in our college newspaper.

And based on this documentary by a current Duke student, it looks like many students still feel very strongly about pursuing a career in finance. They seem to be going through a very similar thought process that I went through while I attended Duke. 

However, with all these articles and the documentary, the one thing that I have to disagree with is that it is more prevalent on elite college campuses for students to want to pursue careers in finance. This is because you’ll find just as many students at state schools who want to be investment bankers or traders, but the only difference is that it is that it is much more difficult to receive an internship or full-time offer to one of the top tier banks from a non-target school.

And having participated in the other side of recruiting from the banks’ perspective, I’ve had the opportunity to come back to Duke’s campus for information sessions and with each recruiting trip, I’ve always been honest to the students I’ve talked to and admit to them that i-banking and Sales & Trading is not for everyone. After talking to several students at these sessions, I also started to be able to tell which students may have been pursuing a finance career more for the money and prestige vs. the experience and responsibility they would gain. I made sure to make it clear that investment banking was a lot of hard work and some of my colleagues found it to be mostly grunt work, so it was very important to realize one’s true motivations for accepting a position in finance because the money isn’t worth it if you didn’t enjoy the work.  At the end of the day, I learned a lot from my banking experience and met a lot of smart and motivated people, but it was really up to me to make the most of my experience and use the opportunity to learn more about what I wanted to do long-term. I knew that the long hours, financial models, focus on attention to detail, meetings with senior management teams, all positioned me and my colleagues well for whatever we wanted to do afterwards.

When I was graduating from college, both the money and prestige of finance didn’t exist to the same extent as it did before, so looking back it was a much smaller group of classmates that chose to pursue a career in finance (it also happened to be two months after Lehman went bankrupt that the banks were recruiting for full-time positions my senior year). From my experience on Wall Street, I’m grateful that I discovered that the area of finance that interests me the most is investing and the industries that I want to specialize in are healthcare and technology. I may not have needed to go through those long hours of working on financial models and presentation mark-ups after midnight, but I truly believe in having no regrets and if I could go back to my senior year, I would make the same decision all over again.

Tuesday, May 1, 2012

Startup Accelerators

In addition to its annual Midas List ranking of Venture Capitalists, Forbes recently came out with rankings for startup accelerators. Not surprisingly, Y Combinator topped the list with a total value of all the companies that have gone through Y Combinator estimated at $7.8 billion (or an average of $45.2 million per company, which is, of course, skewed by the big successes). The good news was that two of the other startup accelerators in the top 10 are based in Chicago: Excelerate Labs and TechNexus.

The other startup accelerator in Chicago that I’ve mentioned before is Healthbox, which is focused on the digital health space, similar to Rock Health in San Francisco, but it is still fairly small and in its first year (although they have announced that they are expanding to Boston as well), so it was not listed in the Forbes rankings. However, it was recently announced that NY is starting a digital health program as well called New York Digital Health Accelerator (NTDHA), which will be accepting 12 startups. This new accelerator is different from both Healthbox and Rock Health because they will be much more focused on care coordination and ways to help healthcare providers. They have also lined up 18 healthcare providers as partners and each startup chosen will receive up to $300,000, which is significantly more than what the other two accelerators are offering.  However, the initial press release didn’t mention how much equity the accelerator will take in the startups, so it will be interesting to see what rules and conditions are attached with the $300,000 initial seed funding.

This new healthcare accelerator in NY and the Forbes ranking of startup accelerators just proves how important these new accelerator models are in the early-stage investing landscape and startup community. Tech Crunch came out with an article last week about the Seven Forces Disrupting Venture Capital, and one of the forces mentioned was Y Combinator. The article claims that these accelerators give companies more flexibility and leverage when negotiating with VCs and also leads to higher valuations. It also acts as an important filtering mechanism for the VCs because these accelerators have become very competitive programs that sift through over 500 applications/interviews for each startup class. Through this selective process, once a company is accepted to an accelerator, VCs know that they’ve received a stamp of approval and are often more comfortable and confident investing in the management team and the company.  However, I do think that having too many accelerators (some can argue we might be seeing a startup accelerator bubble) can lead to a similar problem as having too many VC funds. Only a small percentage of VC funds make good returns because there are a limited number of good companies and talented management teams.  When there are so many startup accelerators and only a select number of good ideas, more and more companies that go through these smaller accelerators will fail if they are unable to receive additional funding after the accelerator program ends. Of course, just like top-tier VC funds, we’ll start to see a similar distribution between top-tier startup accelerators, such as Y Combinator versus other less well-known accelerators.