Interview with Jai Malik of Rocana Ventures and Deep Tech Investor

Jai Malik is on the investment team at Rocana Ventures (seed and Series A), founder & chairman of Mission Control, a frequent deep tech investor (pre-seed and seed), and former product manager at venture-backed AI/ML startups (most recently, Forge.AI). Based in Columbia, MO, Jai is also passionate about building budding startup ecosystems in the Midwest and investing in founders disrupting bread-and-butter industries with frontier tech products and deep ethical thinking. He holds a B.S. in Business and Political Economy from NYU Stern and a B.A. in Philosophy from NYU. Jai encourages all interested readers to reach out to him at contact@jaimalik.co if there’s anything he can do to help them on their entrepreneurial journey.


1) What are you working on right now and why?

First and foremost, I’ve been spending most of my time building a deep tech ethics platform. We’re still in stealth so I can’t talk too much about the specifics, but the underlying thought behind what I’m building is that optimism is cheap. It’s imperative to take big swings in deep tech, but not enough founders are thinking about who or what will be hit with those big swings & how that will impact their efforts to achieve high growth. To that end, we are helping pre-seed & seed stage deep tech founders address ethical dilemmas and reduce ‘ethical debt’ early on in their lifecycle. I’ll have more to say about our thesis & efforts once we launch!

I also recently founded and have been spending time on Mission Control – a next generation incubator for frontier / deep tech startups & college students. What we offer is essentially ‘experiential startup education as-a-service’. So far, we’ve been partnering up with universities in the Midwest (such as the University of Missouri) & pre-seed stage deep tech startups to offer a 12-week immersive, experiential learning program for college students to gain operational experience at a startup. It’s a win-win situation:

  1. We get all parties more interested in deep tech;
  2. Students learn what it’s like to work at early stage deep tech startups & start to think bout entrepreneurship as a more viable career path in the Midwest; and,
  3. Startups looking for an extra pair of hands get to work with hungry, bright students and potentially recruit from the universities we work from.

We expect to start generating revenue next year after we complete our initial pilots this winter.


2) What are some of the ethical issues which deep tech business face?

This is a great but loaded question. There are ethics-related issues which deep tech startups face that are common across any business type or sector – for example, determining corporate values, operationalizing sound hiring processes, or figuring what types of customers you’re willing to sell to in order to prevent unwanted use of the core product.

However, there are also domain-specific ethics-related worries which many deep tech startups face early on, and that’s where we are focusing a lot of our attention. For example, one hot topic in deep tech today is algorithmic bias, and many AI/ML founders will increasingly have to contend with unintended harms that result from it. Best practices for privacy issues are also becoming complex to navigate for early stage AI/ML startups. Finally, for startups that are commercializing a novel, capital intensive product (e.g., supersonic and hypersonic jets), having open conversations about sound testing & safety early on is often tough to think about but extremely important to start kicking the tires on.


3) Can you explain a bit about your journey and how you got here? You’re doing a lot!

Well I won’t bore you too much with the details! But, in all honestly, it all started for me when I graduated from undergrad with a double degree in business and philosophy. I was seriously considering becoming a monk right after I graduated – I wanted to pursue a lifestyle of reflection and spend time thinking about big questions. But I ended up taking the plunge at a startup in the AI/ML space shortly after graduating from college and taking the summer off. Although I’m now firmly in the startup world (~4 years after graduating), I haven’t lost my passion for philosophy; I read both Eastern & Western philosophy voraciously and love all things philosophy of language & science, and I think my current endeavors are a reflection of my joint interest in business and critical thinking.

I’d also say that all of my professional experiences to date have put me to work and pushed me to my limits (in a good way). It has made building 2-3 ventures a lot easier than it sounds!


4) What is your strategy when investing in startups?

Well, let me preface this by saying I’ve had made 9 investments in my own & my firms’ names to date, and I’m always learning more about my own biases as an investor. The most important observation I’ve made at the early stage is that supporting founders with a defined value add is the best way to 2x or 3x the power your capital brings. But with that being said, I generally look for 4 characteristics when picking startups to invest in: (1) a strong team, (2) defensible and disruptive idea / product, (3) reasonable commitment to ethical thinking, and (4) valuation commensurate with return potential.

To elaborate a bit, a strong founding team to me is not necessarily a charismatic one that is great at raising capital. I’m more interested in seeing both technical experience and strategic thinking represented within the founding team. A strong team will usually go hand in hand with a unique angle to address a market opportunity that either exists or will be created & a deep understanding how ethics affects value creation. Finally, I’m valuation sensitive: I’m only interested in investments that have the potential to return the value of all the cash I’m managing and then some. High valuations work for me if I can see a clear path to unicorn status after conducting diligence; if I can’t envision that path, I prefer lower valuations and will be more rigid about how I allocate follow-on capital.

Jai Taylor

5) What advice would you give those who want to break into venture capital?

It’s important to state at the outset that not everyone looking to break into VC is coming in with equal footing and privilege. For example, if you’re white, male, and are looking to break in after working in a prestigious industry (e.g., investment banking), your access to opportunities is already 100x or 1000x what underrepresented folks have access to.

With that in mind, I cannot stress enough the importance of individuality and developing skills around fund operations and due diligence – not just dealflow sourcing. My two cents are the following:

DO:

  • Be courageous to break things and away from norms
  • Spend time working for a startup if you can
  • Network heavily with founders
  • Get in the habit of thinking deeply about how you see the world
  • Start investing small amounts of yours or third party capital

Your investment thesis is your North Star: the faster you network, the more you read, and the deeper you think, you will start to pin down your mission. Republic and other crowdfunding platforms are your friend – start investing through them and through syndicates if you’re able to. Manage invested capital wisely – conduct portfolio reviews and keep yourself accountable to goals you have as you build out your investment strategy.

DON’T:

  • Be a dealflow referral scout
  • Be a fellow
  • Be an intern

I’ve been there and done that with all three above. Everyone around you is likely thinking about how to become a scout or working with a VC fund’s fellowship program. However, it’s worth nothing that most scout programs are simply dealflow referral programs and will not give you the well-rounded skillset you need to manage your own fund.

If there’s anything you take away from my answer, be YOURSELF – network with founders & develop personal relationships, start to pin down your thesis, try your best to get personal access to deals, and find creative ways to deploy capital. One of my favorite people on Twitter (Minal Hasan) is currently deploying capital to seed more emerging managers, and I would love to see more of this in time.


We would like to thank Jai for speaking with us.

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