Best Startup - California
Ziad Makkawi of EQUIAM.
Tell us about yourself?
I am the Founder & CEO of San Francisco based EQUIAM, a systematic, data driven manager disrupting the traditional VC investment model and democratizing access to the asset class.
I am a serial entrepreneur with a 30+ year track-record building and running financial institutions across asset management; private equity; venture capital; and investment banking.
I hold an MBA in Finance from NYU’s Stern; a Masters in Int’l Affairs from Columbia University and a BA in Economics from Rice University.
I am multi-lingual, multi-cultural, learning to play the drums, and an avid art collector.
What do you think is the single biggest misconception people have when it comes to startups?
Well when you think “People” you have to distinguish between people trying to be entrepreneurs and people looking to invest with entrepreneurs.
To the former I say, it’s going to be 2-3 times harder, longer, and more expensive than you think, so be prepared.
As for the second group, I would tell investors contemplating an investment that you have to do the homework, meet the people, get comfortable with what you are considering investing in and then assume you are going be wrong 70% of the time. Do the math!
What lessons has being an entrepreneur taught you?
I think the biggest lesson is that you should be bold, think big. It takes the same amount of effort whether you are doing something small or big.
Being an entrepreneur is like being an artist, a lot of what you do just starts with who you are and what you want to bring into the world.
So make sure you think things through. Experience has taught me that there are people out there much smarter than me, that can do what I am trying to do much better than me, faster than me – find them!
Work everyday to make yourself obsolete by building the best team possible. The individuals you pick, the shareholders you chose, the advisors you attract, these will make the difference between winning and losing, between thriving and dying. That and a lot of luck!
If you could go back in time to when you first started your business, what piece of advice would you give yourself?
It’s going to take twice as long, be twice as hard, and cost twice as much as what you think! Make sure you have the stamina and runway. Be humble, be resilient.
A lot of entrepreneurs find it difficult to balance their work and personal lives. How have you found that?
I agree. It’s not possible….but that doesn’t mean you should not try. Find a rythm, find a routine, stick to it! Come back to it when you can.
Give us a bit of an insight into the influences behind the company?
EQUIAM was born out of a recognition that the Venture Capital space was going to be dramatically altered as a result of the emergence of a secondary market in illiquid, privately held shares of Private Technology companies.
The Venture Capital way of investing hasn’t really evolved much over the past 70 years, it’s still about what the total addressable market is, who the founders are and how will they work together. It has also been about information asymmetry and access to opportunities asymmetry.
The exponential growth in the number of companies, new investors seeking higher returns, and of secondary and primary liquidity and transactions, has created a massive explosion in the quantity and quality of available data.
EQUIAM finds, collects, cleanses, and analyses this data in a systematic way, we filter through the entire universe of VC backed companies and identify those we believe have the highest probability of success.
We then bundle these into portfolios of 30-40 private portfolio companies ideally meant to provide the broadest possible set of investors, exposure to the most exciting asset class, namely to the companies that are innovating and changing the world.
What do you think is your magic sauce? What sets you apart from the competitors?
The use of data & data science to analyze a much bigger funnel of companies than traditional VC firms can; our ability to invest both through the secondary and primary markets ;
The deep insights of the team into the both the private and pubic markets and the track record of the firm and it’s leadership.
Finally all of this packaged into our models, and our systematic investment processes which imbeds all of the team’s experience and insights.
How have you found sales so far? Do you have any lessons you could pass on to other founders in the same market as you just starting out?
Be ready for both feast and famine, you will experience both constantly through the firm’s life-cycle with various degrees of intensity depending on the macro environment.
Focus on building a culture that people can find identity in, especially when times are tough. Build resiliency into your organization, you will need it.
Focus on delivering quality all the time, never sacrifice your integrity. Nothing feels as good as when you win, together!!
What do you consider are the main strengths of operating your business in California over other states in the US?
We operate in the area of venture capital, innovation, technology – California is the global Mecca of all of these!
What (if any) are the weaknesses of operating your business within California?
The cost of doing business here is too high. Taxes are too high.
We are currently suffering through a cost of living crisis. With California already being one of the most expensive states to live in, how has this impacted your business?
Because we are relatively early in our life cycle we need to be very mindful of costs. Everyone at EQUIAM owns shares in the company, so we have incentivized the team with equity. Finding the right talent, the game changers, is what I look for and then the cost/benefit equation is always good.
It is no secret that California is the birthplace of innovation. But that also makes it incredibly competitive. How have you found the competitive environment of California?
I love competition, keeps you on your toes, keeps you up at night, makes you better, faster, stronger! Professionally at least, you become a better version of yourself.
Have you considered moving your company to another state? If so, which state and why?
I would not consider moving to another state but i would consider expanding the firm’s footprint to both NY and internationally.
Where do you see your business in the next 5 years?
We are transforming or at the very least improving the way investing in growth and late stage private tech companies is done.
Our total addressable market is in the hundreds of billions of USD. We are in the midst of a structural transformation in the private markets not very different to what happened in the public markets of the late 80’s and 90’s, namely the growth in the overall size of the markets, the number and type of participants, the emergence of derivative markets, the increase in liquidity and data availability.
Capital will move more efficiently and with more transparency than ever. The democratization of access to the innovation space is underway, and will lead to a better and fairer market place for venture.
This holds true for both entrepreneurs and investors. In this context we see EQUIAM as being an innovator and a leader in the systematic, data driven investment strategy with billions of dollars in AUM in 5 years.
And finally, if people want to get involved and learn more about your business, how should they do that?
[email protected] reach out to us if you have any questions and we will be happy to respond. We only invest in growth and late stage companies that are worth a min of $250MM and have done at least 3 funding rounds.
We are always interested to talk to smart, ambitious, and hard working individuals.
