Heavy Hitters: The Digital Industrial Podcast

Leo shares the origin story of why storied VC firm Susa Ventures decided to launch new fund, Humba Ventures, to invest at the intersection of deep tech and American Dynamism, details what differences are required to evaluate companies with that level of focus on deep tech, defends Humba’s thesis that deep tech is the best place to invest and build right now by dispelling 4 key misconceptions of this category, and brings us home sharing a “What’s Hot and What’s Hype” outlook.  

Paul shares the why behind a storied venture firm like General Catalyst launching a focus on Global Resilience as one of the firm’s 4 key focus areas, how the firm leverages its firm-wide global and multi-stage breadth of mandate to truly get creative in solution formation, describes a sub-segment of their thesis defined around Industrial Resilience “aligning physical systems and digital breakthroughs”, and given the nuance involved with industrial innovation, what the company signals and founder indicators are that get their team excited.  

The besties get the fleet back together to discuss how the 2024 supply chain conference blitz kicked off, what's the insiders' outlook on VC funding supply chain tech despite the macro pullback in deals & dollars, where the freight market cycle sits currently (hint: still as cyclical as ever), and finally where the crystal ball outlooks are for the remainder of 2024.

Anna explains the origin story of why PepsiCo decided to launch Labs and how those efforts for a global CPG company tie into the digital industrial ecosystem, details how the Labs team programmatically both identifies and collaborates with startups to drive a win/win for Pepsi business units and the startups (hint: Labs acts a single point of contact accelerator within the 340k employee organization), and finally details why the Labs team is specifically scouting for manufacturing operations innovation in 2024. 

Maggie shares the origin story of why she launched an industrial tech venture firm in America’s heartland, details how she builds a competitive advantage leveraging a six-state Midwest region of industrial stakeholders to drive value for her portfolio, explains why sector-focused emerging managers play a critical role behind this industrial tech thesis, and shares some tactical lessons learned on how she activates networks within her region of stakeholders across founders, investors, industrial operators, civic leaders, and non-profits.  

Matt outlines why Stifel (~$7B market cap + 8,000 employees) expanded its venture banking group in 2023 to further support the innovation economy, dusts off his crystal ball to describe where the venture market is headed in 2024 and how that macro outlook will play into the digital industrial sectors, shares a ‘then & now’ look on how the digital industrial ecosystem has evolved over the last decade (hint: founders, funders, exits, etc. have all ramped!), and finally defines some hard-earned lessons learned as to what is required in these sectors from a capitalization strategy and building businesses efficiently.  

Chris describes both the why behind Trimble standing up a corporate venture capital (CVC) strategy and what he means by Trimble Ventures being an “and” within the company’s innovation efforts, details how the CVC platform aims to accelerate growth and drive value for its portfolio companies (hint: aligns to corporate objectives to Connect & Scale), and a 2024 look-ahead crystal ball session of “What’s Hot and What’s Hype?”.  

Vijen details both what he defines as un-sexy industries and why he cares about driving innovation into the 81% of the US GDP underserved by VC, outlines how he activates a differentiated network of founders who’ve built in un-sexy industries to drive value for his firm, describes the founders fund ethos he instills into his VC firm by leveraging his own prior experience as a founder, and finally shares some 2024 look-ahead thoughts on trends he is most interested in for un-sexy industries.  

Emily shares a macro outlook on the growth stage ecosystem aligned to sectors in industrial tech, mobility, buildings, and energy, discusses lessons learned investing in these sectors for both software and hardware-enabled software (“bits meet atoms”) business models, and outlines how The Westly Group approaches climate tech investing as its evolved over the last couple of decades.   

Marianne outlines what Climate Tech means to Congruent, shares how her unique industrial innovation background has shaped her own outlook on this topic (hint: all industrial tech companies are climate tech companies), gives us an outlook on how far along we are in the digital industrial adoption curve and what she sees ahead, describes how both hardware (atoms) and software (bits) innovation will play key roles in industrial settings, and finally a “What’s Hot and What’s Hype” section.  

Ryan shares how a 120 year old manufacturing trade association remains out in front driving technology innovation forward in the industry and why AMT launched a Tech Lab in Silicon Valley to support that, discusses what “The State of US Manuf.” currently is, defines how the industry has more of an adoption hurdle than we do an innovation hurdle, outlines how the accelerated US reshoring manufacturing efforts will be closely linked with associated nearshoring efforts in LATAM, and what efforts are underway to build up ecosystem and the associated talent base required for the next decade in manufacturing.

Scott shares why he decided to transition into advising and angel investing in builtworld startups after selling his company to Procore in 2021, details the value he hopes to bring from an operator-to-operator perspective (hint: 3 horizons of vision setting), advises what he thinks the state of ConTech currently is now vs. what has been maturing over the last decade, and describes what it takes to scale the go-to-market engine of a startup when selling into the nuances of the construction market. 

Tom shares how a coral reef led to the genesis of At One Ventures launch, defines what “Net Positive” investing means within the current climate tech landscape, outlines At One’s physics fundamentals approach (matter, time, energy, and space) to screening deep tech innovation that in-turn has the potential to upend the unit economics of established industries, and describes why he is more focused on the aforementioned unit economic analysis ahead of traditional founder archetype and team dynamics heuristics when making investment decisions.

Nate defines how he thinks about “deeptech”, outlines what the current state of venture investing is in the category (tip: deeptech does not have to be capital intensive!), shares how their firm gets comfortable investing ahead of the curve in deeptech categories that may not currently have mature exit environments and/or comps to benchmark, and wraps up discussing the importance of building ecosystem around this category and how even emerging managers can effectively build community. 

Brian shares the REFASHIOND thesis behind the need to refashion the global supply chain, why he believes that “supply chain innovation is the foundation on which all sustainability initiatives must rest”, details how the current venture activity level in supply chain isn’t representative of the sector’s accelerated operational need for innovation, and finally outlines six rules their team defines for investing in early-stage supply chain technology.  

Rick discusses the advantages of having a prepared mind in the 5 key sectors Equal Ventures focuses on, shares a review and look-ahead for the supply chain sector, defines what “Climate Tech” is and how it squarely aligns to the digital industrial ecosystem, and outlines what an Emerging Manager is and how critical it is for an Emerging Manager to have a real, unique competitive advantage in order to stand out in today’s VC landscape.  

Esteban shares how he defines “underserved” economic sectors, why he created the fund to back those founders who are redefining those overlooked industries, what specifically he is looking to evaluate at the earliest stages of investment, what the unique aspects of investing in underserved LATAM sectors are, and he shares his current outlook on what it takes to be an emerging manager in today's competitive VC landscape.

Alex breaks down the definition of a B2B distributor and the critical role they play in the industrial supply chain ($8T in spend flows through them!), outlines why he believes in working with distributors directly to support their digital journeys as opposed to innovating around them, discusses his playbook “The S Curve of B2B Unbundling” on how to drive tech innovation into the distributor ecosystem, and shares some tips on how distributor innovation business models have matured over the last decade.    

Sujeet details the history behind industrial automation software and hardware (hint: PLCs have been around since 1969!), how he defines “3 levels” within the industrial automation s/w stack that are driving convergence between OT and IT environments, what it takes to build a scalable and repeatable go-to-market engine when selling industrial automation innovation, and finally a macro zoom-out as to where he sees US domestic manufacturing capabilities headed to become more intelligent, hyper-connected, and highly automated. 

Kaushal shares the context of ‘why’ one of the world’s premier general contractors has taken innovation so seriously since its founding, how that innovation focus led to standing up their corporate venture capital efforts at WND Ventures, how DPR has defined a highly structured process for engaging external innovation start-to-finish (key: align internal and external incentive alignment early), and “What’s Hot and What’s Hype” currently in the builtworld ecosystem. 

Ben shares an outlook on what’s going on in the growth stage ecosystem given the current market reset (spoiler: lots of capital still to deploy and they remain active), dives into how that reset is impacting the industrial innovation sector now and going forward, what he is evaluating growth stage companies on, and how his team at GS Growth harnesses the vast, global resources of Goldman Sachs to add value back into the companies they invest behind. 

Karen explains how the Chicago Columbian Exposition spurred on the 2nd industrial revolution and inspired the launch of her firm, why there has been such an explosion of venture capital interest and investment in digital industrial innovation over the last decade, what will be required of both the public and private US ecosystems to accelerate the current manufacturing revitalization underway, and finally a chat on “What’s Hot and What’s Hype” for digital industrial innovation. 

Dennis shares how a lifetime dedicated to aerospace innovation led him to co-founding New Vista Capital as his next chapter after Boeing, what the transferable lessons learned are that bridge from running one of the world’s largest industrial companies to early-stage innovation, what he sees as accelerating market trends behind the firm’s aerospace and national security thematic focus areas, and why maintaining US competitiveness in manufacturing is currently one of the greatest challenges and opportunities facing the US in the decades ahead (a matter of national security). 

Jim shares the origin story of Toyota Ventures and how the firm leverages its $500M AUM to discover what's next for Toyota, how having a broad investment thesis beyond just core automotive and mobility helps avoid the innovators dilemma, what he is looking for in robotic-enabled innovation and the associated challenges and opportunities that come with those business models, and how having a dedicated Climate Fund is supporting Toyota’s goal of reaching carbon neutrality by 2050.   

Sam shares how the convergence of data, compute, and advanced engineering is leading to their thesis of “The Super Evolution”, how that thesis is intersecting and driving impact into industrial sectors, what the 4 key trends are that she is seeing develop behind tailwinds in industrials, and why she thinks of climate tech as a “persistent, horizontal underlying trend in nearly every space we touch”. 

Katie shares The Engine’s definition of and approach to Tough Tech investing, her thoughts on why the Tough Tech category has shown fundraising resilience during a challenging time for the broader venture market, details how the firm drives value to their portfolio via both public and private sector partnership networks (stat: for every $1 raised from The Engine, raised another $1.22 from the public sector), and how The Engine has chosen tools and frameworks that enable the firm to quantify and deliver on its deep commitment to having a positive impact on the world.

Hot off a trip to Vegas for the 2023 Manifest supply chain innovation conference, the four besties Chris Stallman of Fontinalis Partners, Julian Counihan of Schematic Ventures, Santosh Sankar of Dynamo Ventures, and host Ty Findley of Ironspring Ventures go off script digging in on a macro market pulse where we are now in the latest freight market cycle, a then & now reflection on what supply chain innovation has occurred over the last decade that led us to today, and finally a 2023 crystal ball session about where both innovation and deal-making trends are headed in this sector. I might even ask them what they would do first if they were made Department of Transportation Secretary for a day...

Lior shares the origin story of both why Uber Freight was launched in 2017 and how the intrapreneurship support he had from Uber leadership was key to building this freight division, the circumstances and path Uber Freight took from launch into profitability in 2022, how far along we are in the autonomous, Class 8 trucking commercialization effort, and finally why Uber Freight decided to link up with competitors Convoy and JB Hunt to form a data interoperability consortium and make freight appointment scheduling more efficient for the entire industry.

Mike outlines how a systems engineering background working on maritime tugboats eventually led to building up the supply chain investment thesis at BVP, how the firm defined its “Roadmap to Supply Chain Software” research to overlap and compliment categories BVP already had deep expertise (enterprise software, vertical SaaS, digital infrastructure, etc.), how over a decade of Vertical SaaS lessons learned can apply directly into scaling go-to-market for supply chain software, and finally a “What’s Hot and What’s Hype” outlook on trends he is keeping an eye on.

Katherine shares with us the why & how the a16z American Dynamism practice was founded to build for America and the national interest (USA!), what it takes to scale a company within these legacy industries whether private or public end markets, a deep dive example into the ~3,000 foundational machine shops infrastructure underpinning the American economy and our national security, and finally a “What’s Hot and What’s Hype” outlook on where things are headed in 2023.

Lior shares what the two ah-ha moments were to launch Eclipse where he saw the tech growth potential ahead for industrial sectors, why the current global macro accelerants to innovation in these industrial sectors have him more bullish than ever on their strategy and additional capital providers piling in, lessons learned on business models at the “interaction of bits meet atoms” and the associated metrics/standards developing as best practices, and we wrap up discussing why its critical to define industrial sustainability impact both in terms of environmental and economic ROI markers to quantitatively build the case of just how important the industrial evolution is to society.

Torie shares the origin story of launching a venture arm, Four More Capital, within the multi-generational Henry Crown & Company platform, how they formed a three-prong strategy to build internal operating company partnerships that in turn drive differentiated commercial value to both the operating companies and startups they work with (hint: show up and get on the plant floor in person), why the rising trend of industrial family office venture investing is here to stay and which investment strategies best fit this model, and finally we wrap up with an outlook on "What's Hot and What's Hype" right now within Industry4.0.   

Bryron shares when, how, and why a private corporation with $120B in revenue, 120,000 employees spread across 70 countries, 10 major platform businesses, 550 manuf. facilities, etc. decided to launch venture capital and growth equity platform, KDT, how their team decided which CVC investing structure was most aligned to drive value back to all of Koch Industries various platform businesses, why Koch Labs was developed as a part of the KDT platform to drive differentiated value creation internally and externally to create a “virtuous cycle of mutual benefit”, and we wrap with a section of “What’s Hot and What’s Hype” in Industry4.0.

Clean Tech, ESG, Sustainability, Decarbonization, Energy Transition, Impact Investing, etc. descriptors have all seemed to blur, and Sophie helps us tie this all together with her definition of ‘Sustainable Investing’ and how she buckets efforts into 7 climate-related industry sectors (spoiler alert: a further deep dive with 80 sub-sectors is coming shortly!). We then discuss the newly proposed SEC rules to standardize and enhance climate-related disclosures for investors, how she thinks these potential SEC climate disclosure rules will be adopted in practice given how far behind most industrial corporations are in their digital transformation journeys, and we wrap up with a deals and dollars venture investment (and exit liquidity!) outlook on the trends she is seeing where Climate Tech is intersecting with industrials sectors.

Stacy walks us through a macro-historical retrospective detailing what structural issues led to the last decade of rapid innovation within the construction ecosystem, outlines when, why, and how he has seen venture capital pour into the broader builtworld environment to accelerate digital transformation aligned to those structural issues (note according to McKinsey, on a comparative basis, VC investment in construction tech outpaced the overall VC industry 15-fold through 2019; and didn’t slow in 2020 or 2021!), and finally we discuss how the accelerated movement towards Pre-fabrication and Modular construction is ushering in major impact aligned to the term “Constructuring”.

Eric explains how he defines Industry4.0 and walks us through a global outlook on how the US, Germany, and China are progressing their respective initiatives, what the challenges are associated with selling digital innovation into these industrials settings both for large enterprise accounts and the long tail of mid-market manufactures (tip: get them to see successful digital innovation in person!), how companies can get started on their digital transformation journies and why you have to bring along the human element from the very outset, and finally why systems integrators are becoming an ever more critical component within the Industry4.0 transition towards digital and interoperable industrial capabilities.

Carl shares what led to his maker passion within industrial settings and re-launching Flying Moose, how the current Russia and Ukraine war (as well as Covid fallout) will impact global supply chains, how he is advising his h/w-oriented startups to harden their own supply chain and manufacturing capabilities, his strategy for capitalizing business models with sizeable 'bits meet atoms' h/w components (tips: take the cash if available, building truly differentiated h/w products create clear moats), why the ‘blitzscaling’ model often doesn’t fit within industrial innovation and in some ways can be slightly destructive, and finally, tech trends on "What's Hype and What's Hot" including a shout out to fusion energy potential.

Heavy Hitters episode 43 is live now with NEA Venture Partner, Jeff Immelt. As a GE Ventures alumni, this one is extra special to me. Jeff discusses how an interest in company creation led him into venture capital as his next chapter after GE, where his role as a Venture Partner fits into NEA’s fund strategy, how he transitioned his skillset from running one of the world’s largest and most prestigious corporations into the venture capital asset class, why he outlined in his new book “Hot Seat” that the most crucial component of leadership for a founder is a willingness to make decisions, where he thinks the Indsutry4.0 adoption cycle is at today and the challenges ahead to overcoming slow adoption (hint: get the money to the floor!), and finally we run through a “What’s Hot and What’s Hype” section.

Mike discusses what the trends and indicators were all the way back in 2017 that led Plug and Play to launch their supply chain focused program, how they leverage their extensive corporate network to build out a win/win/win model to drive value to startups, corporate partners, and Plug and Play, what the specific events and engagement tactics his team leverages to facilitate deep relationships between startups and corporate partners, and from the supply chain program’s global footprint (Silicon Valley, Toronto, Bentonville, Savannah, Antwerp, and Hamburg) Mike shares his outlook on global supply chain trends unfolding right now.

Steve explains what is meant by In-Q-Tel’s platform slogan to “combine the security savvy of government with the can-do curiosity of Silicon Valley”, why their efforts building a bridge between private sector innovation and federal government agencies is so important to us all from both an economic and a security perspective, how digital industrial innovations specifically are legitimate matters of national security for the US government to stay on top of (hint: a lot of offline infrastructure assets are being brought online faster than ever), and how In-Q-Tel tangibly works with its portfolio company to drive value back to a startup leveraging the breadth and reach of the federal government at their side (over a 50% hit-rate on commercial engagement introductions!).

We discuss the ‘6Ts’ framework Aaron developed to evaluate industrial automation innovation, how he analyzes the total market opportunity for robotic applications that are blazing new trails, the capitalization strategy he leverages for businesses that have both s/w and h/w components (bits meet atoms!), what role blitzscaling has to play in these industrial categories where bits meet atoms, and finally, we discuss the underlying macro factors and tailwinds that are at play globally leading to what Aaron coins “The Golden Age of Automation”.

Sunil outlines how he got the conviction to leave a premier VC platform to launch Ubiquity Ventures, breaks down his thesis and definition of investing in “Software beyond the screen”, shares how he defines Deep Tech (and what its not!), details how he got comfortable investing ahead of the curve in Deep Tech categories that often don’t have clear exit potential paths/comparables at the outset, and finally, Sunil provides a critique of why Elon Musk’s comment of “Space is hard” is not only wrong but counterproductive to the ecosystem.

Heavy Hitters episode 37 is live now thanks to BuiltWorlds allowing the release of their 2021 US Summit panel discussion “Tech Strategy: Build vs. Buy”. Listen in on the discussion I hosted with a diverse group of Builtworld experts including Stacy Scopano at JE Dunn, Meg Baldini at Procore, Vivin Hegde at Hilti, and Dave Burns at McCarthy. We cover a lot of ground including evaluating frameworks to decide on “Build vs. Buy (or Partner!)”, how subsequent implementation considerations weigh heavily into those decisions, what tech trends are currently prominent to this discussion, and how the current capital market environment is driving various incentive structures (rationale & irrational) into the equation.

Tim shares his own driver for jumping into the digital industrial investment ecosystem, what he defines as the ‘pre-covid and post-covid’ macro factors that outlined the time was now to focus on these industrial markets in order to both drive alpha for the fund and align to OpenView’s mission to “improve people’s working lives”, why he thinks specialization and having a prepared mind are critical to moving fast within industrial automation applications, how OpenView applies their Product-Led Growth (PLG) model into blue collar industries, and aligned to deploying resources such as PLG, how their platform leverages an impressive 6:1 OpenView employee headcount-to-portfolio company ratio to drive value for their portfolio.

We walk through how Brentt found himself carving out a thematic focus on the Builtworld ecosystem within Greycroft, how he defines the Builtworld ecosystem start-to-finish, why the time was now to begin investing behind that thesis to drive alpha for their fund, why its critical to be thematically and sector-focused in order to compete within the venture asset class today, how Greycroft leverages their value-add platform of resources to support founders scaling in these sectors, share Builtworlds themes of “What’s Hot and What’s Hype”, and how he evaluates exit potential within the emerging Builtworld ecosystem.

Cutler shares why a world-recognized, 60-year old general contractor decided in 2018 to launch a dedicated innovation division, Dysruptek, what his latest industry pulse on the state of construction tech today is, what some of the unique challenges that come with deploying innovation within a construction environment, how he leverages Dysruptek’s corporate venture capital platform to drive sector-focused value both to startups and to Haskell, and we wrap up discussing construction tech trends “What’s Hot and What’s Hype”.

Chris walks us through the history that led to Fontinalis Partners launching one of the very first thematic VC funds specifically targeted on mobility and “Reinventing the way people and goods move”, how the broader mobility ecosystem has evolved over the past 12 years since launching the fund and what that has meant to Fontinalis’s thematic strategy, why sector-focus and thematic specialization in venture capital is important to compete in the current VC asset class, why the automotive industry specifically is somewhat unrecognizable from the decades past, and finally his thoughts on “What’s Hot and What’s Hype” within the mobility ecosystem right now.