Interview with Rishi Roongta, Senior Associate of New World Ventures
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When the term ‘VC Firm’ comes to mind, one tends to think generally: VCs provide capital to startups after seed funding, and own equity in those invested startups. But not all VCs are the same...
Founded in 1996, New World Ventures’ multi-stage approach provides companies with flexibility and enables them to play an active role in the company’s life cycle. What sets them apart from the rest of the ‘VC Community’ is their approach to working with companies and the communities they invest in.
I met with New World Ventures’ man on the ground in LA, Rishi Roongta, to pick his brain about the firm and his recent move to Los Angeles. As a newcomer, the net he’s cast in LA’s tech community is impressively far-reaching. If you need to network with the Who’s Who of the startup world, he’s not a bad guy to connect with. I was less enthused about his suggestion of Equinox for lunch… so I gave him a ‘get out of jail free’ card for that one as he is new to the city. The foodie in me saved the day and took our lunch to Fundamental LA for a tech talk over a delicious meal.
How would you describe the difference between a Venture Capital Firm and an Angel Investor?
Angel Investors are those who invest in a company that is still building a product and needs the cash to launch into the market (typically a seed round). An AV can either be very knowledgeable and involved in the industry/company they invest in, or they might not be, but have accumulated enough wealth to invest. The difference with VCs is that we are typically writing large checks and likely taking a board seat in our investment if we are leading the round or have a sizeable amount of the round. Every VC is different, but larger VCs like us have enough capital to fund additional rounds, which gives the entrepreneur flexibility and safety so insiders can continue to fund the business. VCs will typically also bring a very large network and expertise in areas helpful to the company. We have some great Operating Partners that dive into our portfolio companies to work on strategy, BD, etc.
What type of entrepreneur do you consider for investment?
The most important quality an entrepreneur needs to have is passion. If you don’t have passion behind your idea, it won’t go far. I look for individuals that understand the changing environment of a startup and can focus on doing the right thing for the company. Launching a successful company is about execution and hence a lot of consideration goes towards the entrepreneur and the management team.
Tell us about your successes - exits, valuations?
We’ve been very fortunate to work with some great entrepreneurs and companies over the last 17 years. In the last several years alone our exits have generated over $3 billion in enterprise value. Some exits include: Fleetmatics, which IPO'd, SinglePlatform, which was acquired by Constant Contact, AwesomenessTV, which was acquired by Dreamworks and Playdom (which was acquired by Disney).
Having come from Chicago, what difference do you see in LA’s tech scene vs. that of Chicago?
In terms of energy and momentum, Chicago and LA are very similar. Both have experienced significant growth in entrepreneurial activity the last few years. Chicago is geographically a smaller community which sometimes makes participating and networking feel a lot more intimate than it does here in LA. The great thing about Los Angeles is the number of ‘pockets’ that exist in the tech community and the convergence of tech, media and entertainment, which casts a wider net for the tech scene. LA has always been very entrepreneurial and with community organizations such as Built In, Thursday Nights and Digital LA, the incubators and the support of the local government, the community will continue strengthen and become more intimate.
What improvement, if any, do you think is needed in the tech scene to create a unified, more personally involved community?
The one thing I would like to see happen in LA are more high-quality events that are consistent and attract top entrepreneurs and companies. The social gatherings and seminars that are currently happening are very helpful and we need to continue to build upon the groundwork that has been laid down. In general, the more education and connections that can be made, the better the community will be. I am looking forward to Built In LA doing more programming.
