Episode 27 · 2020-07-05 · 48:24 · Original in Finnish
Finns in Silicon Valley | Jyri Engeström | Negotiator 27
Originally published as “Suomalaiset Piilaaksossa Jyri Engeström #neuvottelija 27”
Jyri Engeström — who sold Jaiku to Google and now runs Yes VC — explains how venture capital actually works in Silicon Valley: why fund maths forces investors to hunt for a handful of enormous winners, why the best founders are in fact risk-averse, and why demand should be tested before a product exists. He also covers what the Finnish ecosystem still lacks: financing infrastructure, a normalised relationship with failure, and the special insight that comes from working the structural holes in a network.
Watch and listen
Key moments
- 00:00 — Jyri Engeström, from Jaiku to Google and the move to the Valley
- 02:30 — The Finnish community in Silicon Valley and helping with hiring
- 05:00 — Is success learnable or is it a lottery
- 07:30 — What growth rate a venture investor actually requires
- 10:00 — The power law: a few winners pay for the whole fund
- 12:30 — Why the best founders are risk-averse
- 15:00 — Don't fall in love with one idea — the surfer analogy
- 17:30 — SaaS and recurring revenue as a requirement
- 20:00 — Angel investing versus investing out of a fund
- 22:30 — The warm reject and why the answer is usually no
- 25:00 — Structural holes in a network and special insight
- 27:30 — From an ad model to a paying customer
- 30:00 — Aligning incentives along the whole financing chain
- 32:30 — A narrow but deep idea beats a broad one
- 35:00 — Testing demand before building the product
- 37:30 — Growth tooling and what to measure early
- 40:00 — You can raise from the Valley earlier than you think
- 42:30 — Learning from failure — the surgeon analogy
- 45:00 — Ecosystem services and the missing Silicon Valley Bank
- 47:30 — Wrap-up and advice for a Finnish founder
Summary
Jyri Engeström — who sold Jaiku to Google and now runs Yes VC — explains how venture capital actually works in Silicon Valley: why fund maths forces investors to hunt for a handful of enormous winners, why the best founders are in fact risk-averse, and why demand should be tested before a product exists. He also covers what the Finnish ecosystem still lacks: financing infrastructure, a normalised relationship with failure, and the special insight that comes from working the structural holes in a network.
Chapters
- 00:00 — Jyri Engeström, from Jaiku to Google and the move to the Valley
- 02:30 — The Finnish community in Silicon Valley and helping with hiring
- 05:00 — Is success learnable or is it a lottery
- 07:30 — What growth rate a venture investor actually requires
- 10:00 — The power law: a few winners pay for the whole fund
- 12:30 — Why the best founders are risk-averse
- 15:00 — Don’t fall in love with one idea — the surfer analogy
- 17:30 — SaaS and recurring revenue as a requirement
- 20:00 — Angel investing versus investing out of a fund
- 22:30 — The warm reject and why the answer is usually no
- 25:00 — Structural holes in a network and special insight
- 27:30 — From an ad model to a paying customer
- 30:00 — Aligning incentives along the whole financing chain
- 32:30 — A narrow but deep idea beats a broad one
- 35:00 — Testing demand before building the product
- 37:30 — Growth tooling and what to measure early
- 40:00 — You can raise from the Valley earlier than you think
- 42:30 — Learning from failure — the surgeon analogy
- 45:00 — Ecosystem services and the missing Silicon Valley Bank
- 47:30 — Wrap-up and advice for a Finnish founder
Watch
The recording lives on the Neuvottelija channel: Suomalaiset Piilaaksossa Jyri Engeström #neuvottelija 27. A Finnish edition of this episode is published at www.neuvottelija.fi.
People and topics
Guests: Jyri Engeström
Topics: Investing & Markets SaaS & Software