Measuring Risk, Calibrating and Going All In
21 Sept 2022 (Charles Lee) — In an exclusive fireside chat held last month with Mr Foo Jixun at NUS College, selected NUS students and NUS Overseas Colleges (NOC) alumni got the opportunity to tap on the wisdom shared by Mr Foo Jixun in his illustrious career.
A Singaporean scholar turned venture capitalist, Mr Foo currently oversees GGV Capital’s investment team and leads its sector-focused investment strategy. Listed on Forbes’ Midas List as one of the top tech investors since 2019, Mr Foo’s experience and wisdom has certainly proved valuable to the attendees of the event.
Below are some of the key takeaways shared by Mr Foo on how he made some of the key decisions which has shaped his career, as well as his various investments.
Innovation requires grit and skin in the game
Despite being a very successful venture capitalist today, there were multiple occasions Mr Foo had also felt that his decisions may have been sub-optimal. When moving from the corporate world to the innovation space, Mr Foo had to sacrifice many privileges such as business class travel and taking a pay cut. However, he remained patient and understood that the impact he was looking for, may take another form from what was imagined. Eventually, as one thing led to another, Mr Foo continued to build on his experience at Draper Fisher Jurvetson ePlanet Ventures (DFJ) and grew to become the founding partner of GGV Capital.
Take time to make better judgments and deduce trends
As Mr Foo shared about his experience investing in some of the most prominent companies in ASEAN-China today, he shared about the importance of taking time to gather data and deduce trends before making key decisions. “When two data points are close together, it becomes difficult to see a trend line. When you have multiple data points, over a larger time period, the trend line becomes clear” Even though the luxury of time may not be applicable to all forms of decisions, Mr Foo’s words struck a chord in many students. In a world where we are constantly rushing to make a decision, it is wise to consider taking a step back to exercise greater foresight.
Measure and calibrate based on new and existing data
Besides allowing trends to take its course on its own, Mr Foo also shared the importance of calibrating based on new and existing data. Information and trends are constantly changing, and this directly impacts his investment theses and positions on key decisions. As with an investment framework, one should calibrate based on the information gathered, anecdotal evidence and data. By constantly calibrating one’s initial hypothesis, Mr Foo shares that one will grow confident of his/her own decisions with time.
Make your own judgment based on first principles, avoid following herd instincts.
Lastly, with all decisions, Mr Foo shared how easy for one to be thrown off by the latest buzzwords and trends. Sharing the example of the bike-sharing start-up trend in 2016, Mr Foo emphasised the importance of relying on first principles and understanding the fundamentals of a business. Even though the bike-sharing concept was novel and allowed relative ease for fundraising in many start-ups, Mr Foo dug deep to understand the unit economics, operational costs and logistical costs of operating a bike-sharing start-up. Understanding these first principles, allowed him to appreciate the value propositions of HelloBike as well as its potential for success. Today, Mr Foo shares that HelloBike is financially strong and continues to pose a strong challenge to its competitors on many fronts. Even though some of Mr Foo’s decisions may not have seemed rational retrospectively, he backed his decisions and hypotheses with data and understood why he was observing specific trends which may not had been caught by the layman. While these decisions require bravery and commitment to a large extent, taking his time to ruminate over his hypotheses and investment theses, has certainly led him to greater success.
Mr Foo strongly believes that students should explore beyond the comfort of Singapore during their university days as it will give equip them with rich perspectives about the world and be a catalyst to spark new ideas. To support this, Mr Foo has established an award, Young Technopreneur Award (YTA), that supports students embarking on NUS Overseas Colleges Programmes. YTA was established to inspire entrepreneurial-minded tech-students to participate in NOC China programmes, to immerse themselves in China, learn about the culture and get a “feel” of the market. Apart from receiving up to $10,000 in award money, recipients of YTA also get exclusive opportunities to get up close and personal with industry experts and learn and be inspired from their own growth stories and advice.
More details about various awards and scholarships available for students embarking on NOC can be found at www.bit.ly/NOCAwards.
