Q: Where else are you looking to expand the DFJ affiliate network?A: Our biggest emphasis is to make the footprint we have as successful as possible. That could keep us busy for a long long time. We don’t have a big push to be planting flags in other markets. Still, we are looking at Southeast Asia, Malaysia and Australia—it’s not a huge market, but there’s talent there and it’s a little isolated. We’re also thinking about Central Europe, the Czech Republic and Poland. It’s a little bit of a fragmented market. They’re all areas of interest, but we’re not forcing ourselves to any timetable there.
Q: What’s your view of venture capital activity worldwide? A: Russia and Brazil have been a little slower to accelerate into the new venture economy. In the case of Brazil, their stock market and growth rate were not hit as much. I was a little surprised their venture economy hasn’t taken off as fast. There hasn’t been as much demonstrated interest into putting money there. People are going to discover it.
Q: What’s the status of VC activity in Russia?A: In Russia, the government created a bit of an industry there with government-sponsored venture funds, but it’s still largely an insular market. I’m optimistic and certainly with President Obama’s visit there recently that relations will improve. We’ve had an icy period for the last year or two. That’s gone a little bit slower than I would have predicted. But on the other hand, we see lots of interest and activity in Israel and Europe.
Q: What about India and China?A: China has slowed a bit, but there’s still a large, growing economy. We’re still active there and we’re still bullish on India. It doesn’t get quite the press China does. There haven’t been a string of exits there that create the role models that everyone wants to see. There’s no doubt that will be coming. We’re we’re optimistic we’ll see great opportunities in India.
Q: Are the DFJ affiliates having a tough time fund-raising in this market?A: Every fund, including the top tier funds, have had a dose of reality with this market, where a good portion of the LPs are no longer investing, like the university endowments. It’s been a new world for all venture funds in any geography and stage. It’s particularly hard on the young funds, the new funds that haven’t had an opportunity to build a track record.
Given that, I’m bullish on our network funds because they are all unique in their strategy and geography.