The majority of us go live out our lives seeing only the current state of the world. We notice technology giants like Facebook and Google, we carry advanced mobile devices, and we use services like Dropbox to store our data. However, Eghosa Omoigui has his eyes firmly upon the future. As a venture capitalist, he looks for and creates deals to nurture the next Facebook, smartphone, or killer web service.
I had the opportunity to interview Omoigui and learn about how he became a venture capitalist, the start of his own firm, the investment opportunity in Africa’s technology growth, and his support of minority entrepreneurs.
Growing Up in Nigeria and Becoming a Lawyer
Omoigui hails from Nigeria and grew up there with his family. He went to law school and originally started off as a lawyer practicing corporate law and oil and gas law. Omoigui was then admitted to the University of Pennsylvania to pursue an advanced law degree. He completed that degree and also later went to business school with a focus on entrepreneurship. After graduation, Omoigui moved straight to California after experiencing his fill of winters in Pennsylvania.
“I realized that East Coast weather and Eghosa were never meant to be mentioned in the same sentence,” Omoigui said with a laugh.
He moved to California and worked for a few start-ups. He then joined a firm where he cut his teeth on the legal aspects of corporate restructurings. Omoigui was then hired to join a law firm practice in Portland, Oregon, that was split between real estate and corporate law. Omoigui spent a year and a half doing venture capital law and finance.
His Start at Intel Capital
The Internet sector began to heat up in 1998 and while there were a few opportunities in Portland and Seattle, most of the action was happening in Silicon Valley. Omoigui left his law firm in 2000 to start a company in the Internet sector.
“Unfortunately, my timing couldn’t have been much worse,” he said.
Due to the bursting of the dot-com bubble, Omoigui had difficulty getting his business up and running. He ran it through the the last three quarters of 2000 and then wound it down. While contemplating his next employment opportunity, he received a call from a well-known venture capital firm called Intel Capital, the venture capital arm of the global semiconductor company, Intel Corporation. The firm’s legal group was interested in Omoigui’s diverse background and he was hired to help Intel Capital portfolio companies as they were taken through exit (i.e., the ending of the relationship between Intel Capital and the companies they fund). Omoigui successfully navigated a variety of exits, both pleasant ones (like IPOs and mergers and acquisitions) and unpleasant ones (like liquidating the company). Since this was between 2001 and 2003, most of the exits were unpleasant.
“I still consider that experience to be intensely valuable, partly because you got to see the other side of start-ups,” Omoigui explained. “Not the hype side, where everyone is getting excitable and everybody is getting funded, but the, ‘Oh my goodness, I have to shut everything down, and fire everybody, side.’”
Omoigui blossomed while performing in various roles at Intel Capital. He later led Intel’s bankruptcy practice group, played a key part in igniting a patent purchase program, and took part in mergers and acquisitions, venture capital financing, portfolio company and supplier bankruptcy, and other business activities. This expanded his knowledge base.
“I don’t think I worked much harder than then, and I fundamentally felt that these diverse experiences would eventually help me,” he said. “I had stood on the sidelines and watched what the good VC’s did (and did not do), and what good companies looked like (and what they didn’t look like). I internalized a lot of that knowledge.”
Becoming a Venture Capitalist at Intel Capital
Omoigui’s work at Intel Capital soon began to speak for itself. He led negotiations out of bankruptcy, managed restructurings, and gained other very diverse experiences. He was then selected for a prestigious position within Intel, but it was not one that he directly sought out.
“You actually never know when you’re being interviewed. Everybody sees the process of an interview as a formal process. You see a job listing, you go in, you interview, but what you don’t really know is that, in many cases, for what are called non-published jobs, you are being ‘interviewed’ in every interaction. Every time you interact with someone who may or may not have influence, you’re actually in an interview. You just don’t know it,” Omoigui said.
Omoigui was formally invited to interview for the chief of staff position at Intel Treasury which was tasked with managing all of Intel Capital’s cash, risk management, corporate credit, mergers and acquisitions, and strategic investments. This gave Omoigui a valuable perch to assist in running the operations and administration of a very influential organization within Intel. After working for seven months, with approximately $18B in cash and marketable securities under Intel Treasury management, Omoigui’s boss was then asked to run Intel Capital and Omoigui, in 2005, went with him to operate as chief of staff of the world’s largest corporate venture capital organization.
“Those were the best experiences ever,” Omoigui said. “We were in the mix of running an immense venture capital operation, doing it on the back of a very large global tech company, staying very technology focused, harnessing superb talent and expertise (both technical and financial), and doing it all at 100 miles per hour.” Eghosa described the mentorship provided by his boss, the Intel Capital President as “second to none”.
Omoigui worked as chief of staff for Intel Capital for two years, and gained diverse experiences and learned how to recognize innovation when he saw it. As chief of staff at Intel Capital, Omoigui helped source some of the firm’s consumer internet knowledge. Omoigui noticed the growing activity in the consumer internet and cleantech sectors and was instrumental in helping to set up new teams at Intel Capital to focus investing in those markets. Omoigui officially transitioned from the operational side of Intel Capital to consumer internet investing in 2007. He spent three years leveraging his interest in the semantic web and became an expert in semantic technology at Intel Capital. He invested in American companies like Betaworks, Grooveshark and Sense Networks as well as several international companies in countries like India (Yatra and BuzzinTown) and Japan.
“It didn’t matter where the innovation occurred,” Omoigui explained. “As long we could get there by plane, train, automobile, bicycle, whatever. It didn’t matter. We would go there and, if it made sense from a business and strategic perspective, we would make the investment. Intel’s reach is amazing!”
A lot of Omoigui’s venture capital instincts have been formed by both a healthy dose of optimism and pragmatism. Intel taught him how to honestly evaluate ideas to see if they can become a business. Also, he learned to recognize ideas that may not work in the United States but could become viable businesses in other countries and define appropriate frameworks for helping assemble the right mix of talent and experience to pursue those opportunities.
Taking a Chance on Omoigui
After gaining a deep portfolio of investment skills at Intel Capital, Omoigui decided to strike out on his own. He took what he learned from working directly with the president of Intel Capital as well as his experiences working with some of the best deal makers to create his own company.
“I‘ve done a variety of transactions and I am extremely comfortable on both the deal side, as well as the strategy side, and, to a certain degree, the product side. I thought it was time to start the next stage of my career by striking out,” Omoigui said.
He left Intel Capital in July 2010 and is currently focused on building his portfolio of seed investments and acting as an advisor to numerous tech startups. His focus remains the same: geo-agnostic consumer internet, media, semantic technologies and mobile opportunities.
The Africa Opportunity
Since Black Web 2.0 has done a lot of coverage of the technology market in Africa, I asked Omoigui for his views about the opportunities there. He noted that many “experts” underestimate Africa.
“For example, when the mobile industry got to Africa, people thought that there wasn’t a lot of growth. People would quote the CIA World Fact book’s GDP and PCI data to support their contention that Africa couldn’t support the purchase of cell phones. A wireless company I had run into thought it would take a year to get to 300,000 subscribers. It took them less than a quarter, and it’s been on fire since then. Think about that. The CIA World Fact Book states that the per capita income of most African nations can’t support wireless, but now Nigeria is the fastest growing wireless market in the world. So I am extremely bullish about Africa and about its opportunities. It’s something I’m definitely going to continue to focus on,” he said.
Supporting Women Entrepreneurs
Omoigui has been a staunch supporter of women entrepreneurs. He was recently selected by Astia (a group dedicated to building women leaders) as Mentor of the Year.
“I think a lot of that started from pure family stuff. My Mom, who has four degrees, is very strong and very driven,” Omoigui explained. “She decided in her 40s that she wanted to be a lawyer so she became a lawyer and later became a judge. It was something she wanted to do, and she did it. My sister, who currently is chairman of the equivalent of the IRS in Nigeria, is a star in her field and was selected by the WEF as a Global Leader of Tomorrow. For me, having come from a background where women did what they wanted to do, it was very natural for me to help out.”
As a mentor to women entrepreneurs, Omoigui helps them develop the right set of skills, build knowledge and personal networks, and think strategically as well as tactically.
“I see more and more outstanding women entrepreneurs every day. A significant part of my day is spent helping out women CEOs, and I enjoy it,” he said.
Nurturing Black Venture Capitalists
Given his position as a venture capitalist of color, I asked Omoigui about the relative lack of blacks in the venture capital field.
“I would be lying if I said I hadn’t noticed. VC is very clubby. VC’s tend to hire people who look like them and have the same background. They also hire ex-entrepreneurs who have made money for them. You have this very interesting vicious cycle where there aren’t really funding a lot of diverse people so, when there are exits, the pool of potential job applicants they recruit from tend to resemble a microcosm of the people they funded. So, if they aren’t really funding diverse people, it’s like an infinite loop,” Omoigui explained.
Omoigui also noted that a lot of qualified blacks don’t get the opportunity to become venture capitalists. However, he believes that there is a solution.
“I think the first thing we need to do is build a base of successful black and female technology entrepreneurs. That’s the first thing. Once you do that, you have a pool from which VC firms can hire. They will have fewer excuses for why they haven’t hired minorities. So, we have to seed the pool,” he said. “This will take time, patience, focus and relentless optimism will be required.”