Vinod Khosla, a partner at Kleiner Perkins Caufield and Byers, is arguably one of the most successful VCs in the Networking Industry. His talk on Wednesday, April 30 2003, at the Cambridge Marriot titled Entrepreneurship and Venture Capital was informative, positive and motivating, not a mean feat in this down economy. Vinod Khosla is a co-founder of Daisy Systems and founding Chief Executive Officer of Sun Microsystems where he pioneered open systems and commercial RISC processors. Vinod serves on the boards of Centrata, Indian School of Business, Infinera, Juniper Networks, Kovio, OnFiber Communications, QWEST Communications, SEEC, Zambeel and Zaplet.

“Entrepreneurship is about those who dream the dreams and are foolish enough to make them come true” says Khosla, ”Entrepreneurs cannot succeed unless they have foolishness in them”. Khosla summarized the important features of what it takes to build a company. As an entrepreneur he emphasized the value of identifying goals, both personal and for the company. “My original goal when I started Sun was not about making money.”

Khosla emphasized the need for a significant value proposition. He recognized the need for identifying liabilities along with the assets. He urged entrepreneurs to seek advice from people who have the right qualification. “Do not ask CEOs advice about a technology they are not familiar with,” said Khosla.

Khosla stressed the importance of finding leverage, whether it be marketing or engineering. “It is difficult to swim alone. You must find a tide that can carry you. For example the concept of open systems was born as a result of Sun seeking an engineering leverage. We decided to focus our attention to development tasks that could be handled by our small crew of 15-20 engineers,” said Khosla. Sun partnered with 3Com for networking and Interface for disk controllers to provide a complete solution to its customers.

Reinforcing the value of the right team, Khosla urged entrepreneurs to find the “gene-pool” of people who bring different skills and ways of thinking to the group. He cautioned against complacency once success has come your way. “Paranoia is key to successful entrepreneurship” said Khosla. While he agreed luck was an important ingredient for success he felt that persistence pays off and “the longer you are around the greater probability you have of luck coming your way”, he said. He concluded with a presentation about recent technological innovations that intrigued him. These included innovations in fuel-cell technology, RFID, combining cell phone and hand-helds etc.

In reply to questions on opportunities in the Telecom industry in the current down economy, Khosla was optimistic. “I think the problem during the boom time was that any technology that provided incremental improvement was considered an innovation. In today’s economy if there is an innovation that truly brings a large enough economic contribution, it is sure to succeed.”

“Entrepreneurship can be assisted but not taught” said Khosla is response to a question on his interest in the Indian School of Business. “In the industry today often entrepreneurs learn by making mistakes. Entrepreneurship courses can cut the amount of failure.” On outsourcing to India he felt that it was here to stay. “We are moving towards a global economy. What is cheaper will be done. But I think this will make the world as a whole more productive.” On the question of which company would he like to be a CEO of today he said “I would like to pick a business like warehousing where IT can truly make a difference.” On his opinion about other countries taking over America’s position as the world leader in the field of innovation, Khosla did not envision it happening anytime in the near future.

Khosla took the time to meet with a large number of people and had a sound word of advice for all. Hassan Ahmed, founder of Sonus Networks, moderated the Q&A session. Over 300 people attended the event. The motivation provided by Khosla was much needed in the present economy and TiE-Boston should be congratulated on bringing such an event. TiECON 2003 promises to bring other inspirational speakers like, Gov. Mitt Romeny, Deepak Chopra, Tim Stemberg and others.

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