Having cut his teeth in San Francisco as a startup analyst before earning a MBA from Stanford, David Rohrsheim returned to Australia in 2012 to help set up Uber.
The 38-year-old has now come home to Adelaide to manage the $50 million South Australian Venture Capital Fund established by the state government to help accelerate the growth of early-stage companies to a national and global scale.
Rohrsheim, who is based in the Stone & Chalk offices at Lot Fourteen in the CBD, said that his job is to meet with startups everyday to determine who and what to invest in.
“My job is to meet South Australians with crazy ideas, and sometimes we get to give them money,” Rohrsheim said.
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“When you’re looking at a startup, often the product’s not ready yet, the business isn’t really there yet, but you’re making a bet on the team and the individuals and an assessment of their ability to do things and change things.”
Rohrsheim said the main thing he looks for in a startup is the fundamental drive of entrepreneurship.
“Thinking about entrepreneurship, first and foremost, it’s people with some passion for some problem that they want to solve,” he said.
“So there’s got to be a deep care for whatever it is: their market, their product, their customers, whatever. There is buy in for some reason.”
Once the solution to a problem is identified, Rohrsheim said the next thing he looks for is the founder’s ability to bring others along on the journey.
“They need to convince people, probably, to quit a stable permanent full-time job and come in and work for an unstable startup,” he said.
“They’ve got to convince their first customers to try something that is not working, yet. Nobody wants to be first, everybody wants to know that someone else has already said it’s good. And then potentially investors.”
Rohrsheim said that takes a special kind of person.
“You got to be inspirational, you’ve got to be brave enough to be wrong,” he said.
“Most startups don’t work and most entrepreneurs know that too. There’s enough education for them to be wise enough to know that.
“So you got to go out there knowing that it’s more likely than not that there’s going to be a story in the paper about how it didn’t work than you becoming a CEO of a billion-dollar company.”
The fact that more startups fail than succeed isn’t what worries Rohrsheim — he just wants to ensure that they only continue to invest in the right ones.
“If I think about all the startups and we’re going to invest in the SA Venture Fund, in a year’s time we’ll sometimes know, ‘Yah, look, the product didn’t quite work or the customers weren’t there’,” he said.
“The right thing to do is to shut down the business rather than waiting five more years to make the same decision.”
“Whereas the success stories like Uber was 10 years from getting started to an IPO and Wall Street. So it takes 10 years to find out. So it’s actually healthy for businesses to fail fast and early.”
Although there isn’t a magic equation to what will succeed or fail, Rohrsheim has some simple math for what’s needed in South Australia.
“We just need more of it,” he said.
“If people aren’t willing to take the risks, then everything stays the same and if everything stays the same, it doesn’t get any better.
“So we do need more of it and it does need to be celebrated.”
Rohrsheim will be able to help celebrate these successes as the newly appointed chair of the judging panel for InDaily’s 40 Under 40 Awards.
The awards, now in their third year, celebrate the state’s entrepreneurial leaders under the age of 40 and in the past have included some of South Australia’s most successful startups.
“There is a very selfish aspect,” the 38-year-old said of accepting the position.
“I’ve been away for a while so for me it’s great opportunity to participate and get to meet the group. Both the people that get recognised and all the folks that apply.”
This article was first published by InDaily.