Wesley Chan often wears his signature buffalo hat. However, he is much better known for his ability to spot unicorns.
During his career in venture capital, he has invested in more than 20 unicorns, including AngelList, Dialpad, Ring, Rocket Lawyer, and Sourcegraph. Five of them later became decacorns: Canva, Flexport, Guild Education, Plaid, and Robinhood. Chan was the first to see many of them.
He initially worked as an engineer at Google and then became an investor. His venture capital pedigree begins at Google Ventures and continues with Felicis Ventures. Currently a co-founder and managing partner of FPV Ventures, he leads the two-year-old company's $450 million venture capital fund with co-founder Pegah Ebrahimi.
All of these successes have been well-documented over the years, but his personal journey has been… Not much. Chan spoke with TechCrunch about how his own life influences the way he invests in startups.
His story began before he was born, when his family immigrated from Hong Kong to the United States in the 1970s.
“They came here with no money, in fact they had no money at all growing up,” Chan said. “It’s really fascinating to see that journey. “It was because I felt it was necessary to leave a place where no one spoke a word of English, a place where I still did not speak English well, and start a new life.”
Chan admits that when he was young, he didn't really appreciate his parents' strength. But growing up in a hard-working immigrant family without a lot of money eventually taught him how to appreciate nuance and become an adaptable person.
“I’m in a business where people judge you very quickly,” Chan said. “Many of my LPs do not have the background that I have. I have to pick all the tunes they are trained on and be a bit of a chameleon. Then I have to send a signal to them that they can trust me.”
How I got into MIT despite my bad grades
Chan's parents separated when he was young, and he was raised in a single-parent household by his mother. He worked three jobs during high school to support his family: a parking lot attendant, a waiter, and a dishwasher in a biology lab at the California Institute of Technology.
He remembers taking a dishwashing job after seeing an ad on Craigslist, and taking the 22 bus to CalTech, a 42-minute ride from his working-class Southern California town, to wash beakers.
One day, his lab manager, Ellen Rothenberg, a renowned genetic biologist, asked him if he could read a college-level book on biology and laboratory techniques. He did it because he didn't want to lose his job.
“I barely took any high school biology,” Chan said. “I went to a bad high school. It was by hook or by crook that I got through school. Other kids were playing after-school sports or taking PSAT prep classes. Not only did I not have that, I had to earn money for my family.”
Regardless of his high school experience, Rothenberg saw something in Chan. When one of his doctoral students left, Chan was promoted to the lab. And for the next three years, Chan studied while attending high school.
This was in the early 1990s, when stem cell research was just beginning. Rothenberg's team taught the teenage Chan their research methods, and he later became part of the group that discovered the protocol for turning stem cells into red blood cells. He also helped the team publish an academic paper on the protocol.
Then one day, Rothenberg, who had attended both Harvard and MIT, asked Chan if he had ever thought about college.
“I need to finish this job and earn money for my parents, but he said I should go to school,” he said. “Little did I know she called her admissions office. “If she’s like a poor immigrant student, she doesn’t understand all these things.”
Harvard ignored her, but MIT did not. And that's how people get into school with terrible grades, Chan said.
“Someone took a chance on me,” he said. “Many people go through ups and downs in life, but I don’t think I would have had an opportunity like today if it weren’t for someone who said, ‘I work hard.’ He wants to do research.’”
Business lessons from loneliness
Chani said that venture capitalists also see it that way. He's not looking for someone who was a member of the right country club. Instead, he looks for someone who has grit and understands what it means to work hard.
“One of the lessons I learned growing up that way is that if you have something to gain, you have nothing to lose,” Chan said. “It’s hard work and there’s a lot of luck involved. Plus, understand that there are people who ultimately help you open the door to everything.”
He acknowledged Rothenberg's help for all his subsequent work.
“If it weren't for MIT, I wouldn't have found Google. If it weren't for Google, I wouldn't have discovered Google Ventures. “If it weren’t for Google Ventures, we wouldn’t have found our team at Felicis,” he added. “Without Felicis, we wouldn’t have Canva and all these amazing companies, many of which are run by immigrants or driven people like me who come from very non-traditional backgrounds.”
To attend MIT, he had to leave everything at home and move to the opposite coast. Chan worked several jobs to make money there, then earned a bachelor's degree in computer science from MIT and later a master's degree in engineering.
What was it like leaving his family? In a word, it is difficult. Because he had to be self-sufficient, Chan couldn't take as many classes as he wanted, and he wasn't able to be like his friends who went on fun trips every break.
However, he used that experience as another opportunity to pursue a life as a venture capitalist.
“When I led our Series A at Canva, we were able to get over 40x returns on that fund, but 111 people said no, so it was very lonely doing the deal,” Chan said. “If you’re someone who can’t go to prom because you have to work, or someone who can’t go on a ski trip or prom, that’s the problem I’m dealing with.”
That exclusion taught him this: “Who cares if the rest of the world laughs at us? You gain this amazing amount of grit and the ability to like being lonely and be okay with being lonely.”
After graduation, Chan returned to California and took a job at HP Labs. Then the dot-com crash happened and that fell through. But all is not lost. There was a company that was hiring even in harsh environments. And they happened to like people from MIT.
Spoiler, it was Google. Now working at Google is not like the movie 'The Internship' where Vince Vaughn and Owen Wilson go into an internship and spend their time competing against other teams on various projects. It was better for those who like dogs…
“The dogs will run around and bump into you and make you fall,” Chan said. “It wasn’t like that movie. “I have to go to work.”
He said, “I was lucky to participate in the advertising system development project, which was the most needed at the time.”
Creating what the founder wants
This began a 15-year Google career that included seven years building the product and five years as chief of staff to Sergey Brin, who co-founded Google with Larry Page. Chan worked on projects including the Google Toolbar, which became Google Chrome.
“It was great when you were one of the few companies that made it,” Chan said. “Larry and Sergey were very kind and always said, ‘Wesley brought us something, we should let him try this out.’ It will eventually become Google Analytics or Google Ventures.”
He was also one of the people who interviewed Sundar Pichai when he joined Google. Apparently, Pichai later became the CEO of Alphabet and Google.
In 2009, Chan told Google that he wanted to start a startup. He joined the company when it had fewer than 100 employees and stayed until it had over 35,000 employees. I remember him joking that if you go to a startup, you're the one buying the toilet paper. Chan's answer was that he didn't mind buying toilet paper. Instead, they offered to help Bill Maris build Google Ventures.
“Rather than becoming a founder who creates a product that the company wants, he told me to go create a product that the founder wants. And we did it.” Chan said. “Google Ventures is still a real company today that people want to get paid for.”
In addition to overcoming obstacles to get to where he is today, Chan continues to face some adversity, especially as a gay Asian man in technology. When he first joined venture capital, he said, high-ranking white men were running the companies and sharing deal flow from soccer fields or African safaris.
Some people want to build a deal flow network, but it's difficult if your background doesn't fit the country club mold, he said. And there aren't many support groups for the LGBTQ+ community in venture capital.
“That’s the difficulty of being an outsider in this business,” Chan said. “You have to find different ways to forge your own path or collaborate with founders so you don’t look like you’re lazy or making progress. If you look at the number of successful venture capital and LGBTQ+ partners, you can count them on two hands. That's not a large number, but there are probably 6,000 venture capitalists. Why is this so underrepresented? And the number of people who are as publicly active as we are is much smaller.”
That's why he and Pegah Ebrahimi started FPV Ventures two years ago. To provide an investment style based on their unique backgrounds. (After starting her career as the youngest CIO at Morgan Stanley, Ebrahimi held a number of top executive roles at various technology companies. She actually worked on Google's IPO.)
And our managing partners do this with the support of charities and foundations. Many of the company's founders work “with a deep interest in making money for good people,” Chan said.
“Our founders are underrepresented as minorities or women. A really interesting theme I keep hearing is that they feel people misunderstand them,” Chan said. “We look for founders who have a drive to succeed and an incredible combination of humility and success. They also ensure that everyone is cared for.”
