1Mby1M Virtual Accelerator Investor Forum: With Krishna Srinivasan of LiveOak Venture Partners (Part 2)

Sramana Mitra: What you’re pointing out about repeat entrepreneurs versus first-time entrepreneurs is interesting. The vast majority of our community is first-time entrepreneurs. I always say this. If you are a repeat entrepreneur with track record, you can get away with a lot.

You can do a fat startup with somebody writing you a check. There are lots of options, but as a first-time entrepreneur, none of those doors are open for you. You’re going to have to do it the hard way. You have to bootstrap to product/market fit at some level. What about B2B/B2C? Are you doing both?

Krishna Srinivasan: Being geographically focused, we end up being somewhat more segment-agnostic. The company we end up investing in are companies where world-class talent available in this market ends up. The talent here is pretty broad, but the concentration of world-class talent here ends up being either in infrastructure software or vertically-oriented software and technology enabled-services.

There’s a tremendous number of industries here that have historically under-invested in talent. We come across a lot of the vertically-oriented software or technology-enabled services here. That is the bulk of the activity that we back.

Sramana Mitra: How is the geographical distribution within Texas? Between Austin, Dallas, and San Antonio, how do you see the companies coming out? Are they also coming out in places other than Austin and Dallas?

Krishna Srinivasan: I would say Austin is definitely the strongest of the markets. We see a big surge of migration from California and other parts of the countries these days. Two-thirds of the activity is here in Austin. I would say Dallas and Houston are following that. San Antonio is fourth on the list.

Sramana Mitra: Talk to us about some of the highlights in your portfolio. As you are telling us some of these stories, give us some insight into what was going on. When you saw these companies first, what was it about them that attracted you? What we try to do is give our audience a bit of an insight into how you think about investments.

Krishna Srinivasan: Today, we have 23 investments in the fund. The ones that I highlight for you fall into this category of industry meets technology. Interestingly, going back to the comments you made, many of them have first-time entrepreneurs. These first-time entrepreneurs typically are leveraging their domain expertise in some form or fashion. They have an acute understanding of the challenges and problems in those industries.

They might also be technologists themselves or pair up with technologists in order to tackle those gnarly problems. They are able to get to product/market fit earlier. We’ve got companies in legal. We’ve got three companies in healthcare. We’ve got a couple in real estate. These are people that have a keen understanding of emerging problems in those industries. I would urge entrepreneurs to go back to their strengths.

To give you one example, one of the most exciting companies in the portfolio is CS Disco. It’s a company that makes software for e-discovery. It’s a complex problem of taking documents that come in. This is a mission critical platform in which outsourced managed services from corporations and law firms are collaborated on this platform through the lifecycle of a case.

The company was started by the youngest ever graduate from Harvard Law. He came into Harvard Law at the age of 19 with an undergraduate in Computer Science. While practicing as a litigator, he discovered how terrible the software stack. He hired guys to rewrite these software stacks. He was able to leverage his domain deeply to build an incredible product.

This smart guy who has domain knowledge formed the company and left his law firm to be the Founder and CEO of this business. Disco exploded. Today, over 200 law firms use the product. Hundreds of major enterprises are using it. It is, today, the leading cloud-based e-discovery platform on its way to being a really substantial company. I’m on the Board of the company.

This segment is part 2 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Krishna Srinivasan of LiveOak Venture Partners
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