Investment Theses Posts

There’s an outstanding interview with Vinod Khosla on PBS’s web site. Here are some of the highlights.

On the real big opportunities:

The real big opportunities are changing the infrastructure of society. We are talking about things like the $200 billion engines market for automobiles and trucks, things like lighting, billions of dollars spent on lighting. We can completely change that. Cement. Huge multi-hundred billion dollar market that needs to change. Glass. Then there’s replacing all of the oil in the world. Hundreds of billions if not trillions of dollars worth of fuel that needs to be replaced. And there’s gasoline, there’s diesel, there’s jet fuel.

“There’s no doubt in my mind over the next 25 years how we drive, how we build our houses, how we fly, how we build our buildings, will all change. And that’s essentially, like I said, the infrastructure of society…”

On stock prices:

“… we have too large a tendency to look at the symptom of stock prices which is almost irrelevant to the basic businesses we are trying to build.

On Khosla Ventures:

“We want to invest in the technologies that are high risk, so it’s okay to fail, but when we succeed it’d better be worth succeeding. We’d better have very large dislocations with these technologies.

“We like to say at Khosla Ventures, and this is one of the reasons to do what we do, we’ll take technical risks that nobody else will.

“We take the larger risks, real science experiments, and that’s been one of the founding pieces in our company.”

On venture capital:

95 percent of people in the venture business think it’s a financial business, it’s about investing. It’s not. It’s about building companies, which is a different thing than investing. It’s about taking large risks in science and technology. That’s what we do.

“We are an investor that tries to build companies. We make money by building entities over the long term. We’re not in the business of transacting or doing deals. We don’t even allow that word here. It’s not buying and selling, that’s a transaction. You don’t invest in something and say I can sell it tomorrow or next year. We take a five year, ten year view and say we can build a company that can significantly change the landscape. Now if you happen to do that, you build companies of lasting value, make a large impact and if you do, you’re going to have a valuable company that you can make money on. So it’s a long term versus short term perspective.”

Thanks: To sec314 for pointing me to this article.