18 Oct 2016
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China, artificial intelligence, and Jim Breyer

VC giant offers insights and advice to Forbes Under 30 attendees
Re: Scott Cook (MBA 1976); Sheryl Sandberg (MBA 1995)
by Jennifer Myers

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A venture capitalist with a career spanning three decades and a net worth of $2.6 billion is certain to have had a few big fish escape his hook over the years.

For Jim Breyer (MBA 1987) of Breyer Capital, the Moby Dick that haunts him more than a quarter of a century later is missing out on investing in fellow HBS alumnus Scott Cook’s (MBA 1976) Intuit Inc.

“I tried but I lost the deal and I still think about it 27 years later,” Breyer told a room full of young entrepreneurs and budding venture capitalists in Boston on Monday as part of the Forbes Under 30 Summit. “There have been a lot of misses.”

Those misses have been pushed into the shadows by the hits in Breyer’s portfolio, including a once-little startup called Facebook.

Breyer met Facebook founder Mark Zuckerberg in April 2005. Within 48 hours he knew he wanted to invest and the negotiations began.

“What I loved about the presentation was that at the bottom of the website it said, ‘A Mark Zuckerberg Production’,” he recalled. “I knew he was passionate about the site and making it a platform beyond college campuses.”

“I caved,” he said. “It was five cents a share.”

Breyer invested $13 million, an investment that has produced billions in return.

“Mark epitomizes courage and intensity and isn’t afraid to be wrong,” Breyer said. “And he also made the decision in 2008 to hire Sheryl Sandberg (MBA 1995) . The combination of Mark and Sheryl is the single best team at a senior level in the world.”

Breyer said the best advice he can give to young entrepreneurs today when facing meetings with venture capitalists is to have “humility, confidence, and a great team.”

“Understand the competition,” he added. “But most of all, just be passionate about what you are doing and constantly ‘ask what can I be doing better?’ Those are real positive characteristics.”

The future of venture capital sits in two sectors, Breyer predicted—artificial intelligence and China.

This summer, Breyer and IDG Capital Partners, the Chinese company he joined forces with in 2005, announced they had raised $1 billion to invest in growing technology, media, health care, and energy companies in China, as well as companies seeking to enter the Chinese market.

It is their seventh and largest fund. Breyer credits his partnership with IDG with his ability to identify opportunities on the ground in China.

“There has been no turnover at the senior partner level,” he said. “They are brilliant, work 100 hours a week and are intensely competitive.”

When considering in which startups to invest capital, Breyer said if the company does not include an artificial intelligence data analysis component he will not consider it.

“Data analytics applied to really important, challenging problems is for me the single most important place to be investing in the next decade,” he said, adding he recently invested in Headspace, a company that provides guided meditation sessions online or through an app.

“Behind the scenes, there are 25 data analytics people constantly seeing at what point in the mediation app it is working or not working,” Breyer said. “It starts with great content and with people who deeply care about meditation. Marrying that with the data analytics makes the meditation far more valuable.”

“If I am able as a venture capitalist to get artificial intelligence and US/China right, I will be set,” he concluded. “In my view, that is 60 percent of the returns that will be generated in venture capitalism in the next decade.”

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Class of MBA 1987, Section D
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