EHK Talks to Director of Microsoft Ventures Frances Du
Frances Du: ‘Shoot first, aim later’
Frances Du is the Director of Microsoft Ventures in the Greater China Region. She is also a successful entrepreneur, writer, speaker, investment expert and adjunct university lecturer.
This interview with Frances Du was conducted and condensed by EntrepreneurHK (EHK).
What are the common characteristics of a “fundable” startup?
A ‘fundable’ startup is a startup company which investors are attracted to. Hence why understanding what an investor wants is a key part in answering this question. Investors will always be looking for big profits in return, which means a high growth potential and a great team to make it happen.
What is the one thing that you always look for when you evaluate startups?
The team! I will always put team quality as a top priority when evaluating startups.
What are the big “red flags” that indicate you should pass up on an idea / start up?
Limited growth potential, due to a very small market which is a niche of its own or high costs when it comes to expanding the markets reach.
The founder(s)’s personality vs. startup idea, which one is most important?
The founder(s) personality is much more important than the idea. For example, there used to be over 1000 Groupon similar group-purchase sites in China a while ago, but 95% of them are now gone. Only a few survive and the founders’ personality plays a very important role in this.
A lot of start-ups / people are reluctant to talk about their ideas, whether it is with investors or friends, fearing that the “unique” idea will be copied, how important would you consider sharing is at an early stage?
I always believe that the way you execute the idea is much more important than the idea in itself. I do not think there is a way in which you can assure yourself 100% that no one will copy your idea. Just the way the Groupon-like idea is not unique, but Meituan.com has grown into a billion-dollar business whilst most other of its competitors which started at the same time are now dead.
From your personal experience, what is the fundamental difference between the start-up mentality in HK vs Beijing (or other Chinese cities)?
I do not feel there are any fundamental differences between the start-up mentality in Hong Kong versus Beijing or any other Chinese city. Perhaps Beijing start-ups can be a little bit more risk taking during decisions and most of them will focus on China. Whereas Hong Kong start-ups are more conservative and cautious in comparison and most of them will start thinking about the international market earlier on at the beginning stage.
How about investors, what is the fundamental difference between investors in HK vs China?
I also do not feel there are any fundamental differences between investors in Hong Kong versus China. If anything, investors in China will be more tolerant towards higher risks at earlier stages of the investment process. This might be because in China, decisions are made very quickly, one page entrepreneur-friendly term sheets, etc.
Frances, you’ve been an entrepreneur. What is the one most prominent story/lesson you wanted to share with all the aspiring and current entrepreneurs out there?
The entrepreneur life is very different to the corporate life, and much more stressful than you could ever imagine. You will need a strong body and mind balanced with a good work ethic.
Give me one piece of advice for all the startups out there?
Do not think too much, have a quick start, test the market, make a quick pivot. I once translated a book titled ‘Think like an Entrepreneur’, in it the author said how the entrepreneur behavior is one where you shoot first and aim later. This is what I mean by that.
About Frances Du
Frances Du (杜枫) is the Director of Microsoft Ventures (MV) in the Greater China Region (GCR), charged with support and investment works for GCR startups, and dedicated to build MV into a strategic partner for promising startups around the world.
Before joining Microsoft, Ms. Du was a founding partner in GRC Sinogreen fund; a China-based venture capital fund focused on the green investment area. In GRC Sinogreen, Ms. Du’s focus areas are IT applications and services that can enable traditional industries with better performances and a greater efficacy. Ms. Du has over 15-years of investment and entrepreneurship experiences in various fields such as venture capital, private equity, enterprise strategic investment, and etc.
As a successful entrepreneur, Ms. Du co-founded JL McGregor in 2005, which is an expert in securities market research and financial consultancy, and got investment from Goldman Sachs Group. She brought it up from a startup to a company with more than 150 employees, over 30M$ in revenues and offices in New York, San Francisco, Shanghai and Beijing. In addition to Microsoft, Ms. Du worked on investment and financing areas in Intel (China) Ltd. and ABB (China) Ltd.
Ms. Du is an active writer, welcomed speaking guest and thought leader in the startup ecosystem, venture capital investment and entrepreneurial research area. She has three publications on venture capital, including The Money Chase – 10 Steps to Get Venture Capital (author, Peking University Press), Think Like an Entrepreneur (translator, China Market Press), and CEO ( co-translator, China Market Press). She also wrote a biweekly column named PE Watch for the Chinese Site of Wall Street Journal from 2009 to 2010, and it was widely admired.
Ms. Du has an MBA from Guanghua School of Management, Peking University. As an expert on investment and financing area, Ms. Du worked as an associate fellow at Institute for Cultural Industries, Peking University, and an EDP training instructor in Guanghua School of Management. She is now an MBA special instructor in Beijing Normal University, giving lectures to MBA and EMBA students, entrepreneurs and government officials.
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