#219 Ed Sim-Episode Notes

Key Takeaways

Ed Sim’s values of courage and conviction have been instilled in him from his immigrant parents. Their journey escaping North Korea and pursuing the American dream have set the stage for Ed’s work ethic.

“That’s courage and conviction, unlike any you could ever imagine. Then I think just from that like I can’t be afraid, I have to take risks”

While attending Harvard and playing lacrosse for them, Ed’s knowledge and interest in venture capital began. Although he was declined from Harvard Business School, Ed taught himself to code and throughout various roles got to where he is today, founder of BOLDstart Ventures. There’s no questioning that this is what Ed’s passion is.

“I was just intellectually curious about enterprise software, for whatever reason just fell in love with enterprise software”

Throughout his wildly impressive career, Ed has distilled down what he believes makes a good investor.

“A good investor knows when to cheer, a good investor also knows when to challenge, and a good investor also knows when to chill”

3:43 Ed’s Time As a Lacrosse Player

Sean and Ed both were elite lacrosse players, and Sean asks Ed about his experience playing at the elite level. Ed went to Harvard to play lacrosse and was on a number 3 team in the country. Ed credits his high school coach for leaving a lasting impression on him.

“That whole mentality of just put your head down, bring your work ethic, bring your lunch pail everyday, that blue collar mentality, is something that I carry with me everyday”

5:50 Ed’s Career Journey

After Ed learned about venture capital in college, he sent out 120 handwritten letters to every private equity, venture capital, and LBO shop out there and received 1 letter back telling him to get work experience. He then went to New York and worked for JP Morgan.

One of his coworkers said to him:

“Ed, let’s learn how to automate our job”

They started learning how to code and a month later they had a system in place that automated their job.

Ed still wanted to go into venture capital but was declined from Harvard Business School – which was where many applicants for the industry had learned from.

Ed saw an ad in the Wall Street Journal and his self-taught coding skills were what got him the job. He worked with the firm for two years and met his mentor Bob Lesson there. After two years, Bob wanted Ed to come join him for his own venture capital firm he was starting, and at the same time Ed was accepted into Harvard Business School.

“I’ve carried that chip on my shoulder for a long time and so I ended up not going to school”

Ed worked at Bob’s firm until 2010, and then started his own company BOLDstart Ventures which is where he works today.

10:20 What specifically about Ed did Bob see?

Ed has always been curious – and always wants to know what other people are a geek about – and his passion for enterprise software was clear to Bob.

“I was just intellectually curious about enterprise software, for whatever reason just fell in love with enterprise software”

Ed also says he was not intimidated by Bob, while many others were, and that stood out to Bob.

“I was passionate about it, he could tell that I was fired up about this and enterprise software and venture capital, like this was my dream”

11:32 Courage and Conviction

It’s obvious Ed has courage and conviction, but where did he get it from? He credits his immigrant parents to setting an example of inspiring work ethic.

“They worked hard, they made a lot of sacrifices for us to be here”

Ed talks about how he has begun reading the book Dear Leader and it has taught him more about what his father went through during his escape from North Korea as a teenager.

“That’s courage and conviction, unlike any you could ever imagine. Then I think just from that like I can’t be afraid, I have to take risks”

14:39 Recognizing Passion in Founders

Ed’s company has recognized that the most successful founders are the ones that are trying to solve a problem that was born out of pain.

“We love the passion, we love born out of pain and experiencing that pain and trying to solve that because those are the founders that will work through the hard times”

While Ed’s team only funds technical founders, Sean is curious if he’s ever had a team that doesn’t have above average ability technically but that Ed was almost sold on to them.

A team has to be technical and have a depth of thinking around going to the market and telling a story.

“If you can’t tell a story in a very succinct way, it’s hard to recruit people to join your movement”

18:00 Inspiring Founders

One of the founders in Ed’s portfolio currently is a company called SNYK.io. The founders goal was to create the easiest way for developers to secure all of their open source code without having to waste time. Ed’s team wrote a big check early while other venture capital firms had doubts.

“Fast forward a month ago, we announced that the company is worth 2.6 billion now”

Another founder that fits Ed’s criteria is Superhuman founder, Rahul Vohra. Ed’s company founded Rahul’s first company and has continued to work with him.

“The thing about Rahul though was that he’s always had this vision of making people brilliant at what they do”

26:40 Founders Changing Their Initial Vision

Ed tells the story of how he was one of the first investors in GoToMeeting. This was a company that had a core technology that would allow someone to take over someone else’s desktop and help with technical support.

“We ended up spending 10 million dollars and it actually went nowhere”

They took the core technology and started GoToMyPC and it grew like crazy. The team then applied this to the video conference industry as well and called it GoToMeeting and it skyrocketed in sales.

“The initial market didn’t work and look where it ended up today”

30:16 Ed’s Decision Making Process

Ed looks to see if each founder has the 5 P’s before writing that first check: the Pain, the Product, Passion, Patience, and Potential.

“You have to actually say rather than why can’t someone do something, you have to ask yourself why can someone do something?”

Among the thousands of companies that Ed meets with, he says it all comes down to the founder and if he believes they can do it.

“If someone’s going to do it, is this the founder that’s going to do it, is this the founder that’s going to take on the giants, is this the founder that’s going to create the new market”

34:02 Ed’s Specialization

Ed recognizes that there are many venture capital firms out there and that he has to provide distinguishable value from the others.

“We specialize in helping founders at the white board level who are enterprise and are highly technical. We help them try to become great CEO’s.”

Ed’s team surrounds the founders in their portfolio with other technical founders who have become great CEO’s.

“I want people to understand that we’re innovating, we’re trying new things, we’re going to continue to try new things”

Ed credits his wife to his firm’s success, saying that she’s the “silent third partner”.

“Every part of our success comes down to having a super supportive partner”

41:59 Ed’s Story of Feedback Loops

Ed says that their early on feedback loops as a firm go back to their values of courage and conviction.

He tells the story of a company called BigID, that was focusing on data privacy and protection. At a startup competition, one of the founders was presenting their product at the same time that Mark Zuckerberg was testifying in Congress about privacy, and won the competition.

Ed says that he can tell if things are going to be successful early or not with two things:

Product Velocity
Hiring Velocity

46:35 Ed’s Comparative Advantage

Ed says that he is always trying to learn from the past.

“I’m always a lifelong learner”

48:23 Ed’s Information Diet

Talking with founders, his board, and his team are where Ed says he learns the most.

“My job is not to see the future it’s to find founders that can see the future”

Ed also spends time each day reading or listening to podcasts as well.

50:20 How COVID has impacted Ed’s productivity

Prior to the pandemic, Ed’s job allowed him to travel consistently, and Ed says that his productivity has increased dramatically by the elimination of travel time.

51:11 The hardest skill for Ed to pass on

Ed says that it’s hard for people to flip their mindset from “why can’t someone do something” to “why can someone do something”.

“Not only seeing that why but also seeing the people that have done it before”

54:24 The Best Network Builders

People that Ed recognizes as the best network builders treat networking like a job.

55:23 Distilling ideas

Sean found that Ed used to be a blogger and asks him what his process is for distilling down an idea and choosing to write about it. Ed says that if the topic came up in various conversations he would decide to write about it.

“My thing is how to distill it in the shortest way possible and that’s such a challenge”

He explains his recent distillation of the idea of the “3 C’s”: