The Art of the Fresh Look: From Chips to Cloud

The Art of the Fresh Look: From Chips to Cloud

Interviewed by on April 23, 2024

For her whole career, Rohini Chakravarthy has been trying to understand what technology innovation means. Initially working on network engineering, what she calls ‘the AI of the nineties’, Rohini would find herself in a period of technological transition.

“The adoption of technology is not dependent just on the invention,” she comments “It’s also dependent on the demand side, who’s receiving it and who’s enabling it. So that intersection of new technology, new economic cost points, and new usage or new communities. That has been the area where I have been most interested in over my career and continue to do.”

A MIT-eoric Rise to CVC

After working as a network engineer, Rohini decided to continue her education, pursuing an MBA at MIT Sloan. At MIT, Rohini was deeply involved in entrepreneurship activities, participating in the MIT $50K competition and the first MIT VC conference. This exposure to venture capital and startups significantly influenced her career trajectory.

Towards the end of the program, Rohini was discussing with one of her classmates about what they were interested in. The classmate had worked at Intel previously and recommended Rohini join Intel Capital, the original CVC. Rohini was excited by the prospect. Through the classmate’s introduction, she joined Intel Capital in 1999 as an investment manager. Within just over a year of joining Intel, Rohini witnessed the dot-com boom and bust, a formative experience that provided her with critical insights into the tech industry’s cyclical nature.

Gathering Intel-ligence

During her seven years with Intel Capital, it proved to be a very good training ground for Rohini. She joined during the tenure of Les Vadász, Intel’s employee number four and the creator of Intel Capital. The group had started to look ahead at potential market disruptions and carry on some of the innovative spirit that Les and the other founders had embodied.

Rohini learned a lot from Les and became involved in the technological innovations of the post-dot-com era, which was soon followed by the pre-cloud era. She observed and contributed to the rise of mobile and wireless technologies.

Networks, Standards, & Wifi

One of Rohini’s significant projects at Intel was her involvement in WiFi. Rohini explains, “Networking has a classic chicken and egg problem, right? Somebody has to either build the cellular network and then bring in the phones or forward price and make sure there are clients available.”

Intel opted to forward price since it was confident it could build a network. However, there were enough ecosystem players that it became clear a clear set of rules would need to be established to prevent incompatibility issues.

Often, companies will “innovate within a box,” said Rohini. They can develop their own technologies and solutions, but once they exit the box, they need to interact with other solutions through agreed-upon standards. So, the Wi-Fi group developed a set of standards, the IEEE 802.11.

Reflecting on her role as a voting member at WiFi and Intel representative, Rohini identifies several key considerations. Developing standards is a democratic process requiring companies to collaborate and create an ecosystem. The adopted standards must be “somewhat future-proof,” anticipating future trends. “There are people standing in all these corners,” comments Rohini, “there’s a lot of horse trading,” leading to informal agreements as a part of reaching a consensus.

Looking NEA and Far: Fresh Looks

After seven years with Intel, Rohini was faced with two paths. “(I could) keep growing within Intel and go into the business units and take on more strategy roles or be a professional investor.”

Rohini was unsure which path to take until she attended a Sloan alumni lunch. There, she met Kittu Kolluri, an entrepreneur and investor joining NEA. They had a lot in common, and he invited Rohini to join with him.

While at NEA, Rohini would inherit portfolio companies from outgoing investors. Many of these companies would have subsequent funding rounds after making the initial investment, requiring NEA and Rohini to take a ‘fresh look’ at the portfolio company’s prospects of success.

The ‘fresh look’ process was challenging because NEA, often the lead investor with a majority stake, managed the syndicate and CAP table. Decisions to proceed with follow-on investments had to be carefully communicated, as they sent signals to other investors. A new funding round usually required a ‘yes’ from Rohini; a ‘no’ often meant the company had to consider exit options.

As the decision to follow-on is sensitive, Rohini describes a process that is not quite a “rubber stamp, (and that is) thorough and somewhat dispassionate.” As an investor you can’t be “too ployanaish, as you might make a decision without enough data to support it. But if you build too adversarial a system, you might overlook opportunities,” describes Rohini. Thus, aspects like the product-market fit, burn rate, team dynamics, and syndicate strength to support the portfolio all need to be taken into account.

Looking Ahead

Currently, Rohini is the Managing Partner at NewBuild VC. After departing NEA in 2016, Rohini joined Nokia’s investment arm, NGP Capital. Nokia raised funds to cultivate ecosystems of different generations of telecommunications technology. The funds followed the 2G, 3G, 4G, and now 5G transitions.

NGP’s investment in 5G was unique since 5G drastically expanded the network, allowing devices other than mobile phones to connect. They were required to invest in the supply chain needs of 5G and other software infrastructure that would be required.

NewBuild was cofounded in 2022 by both Rohini and Chad Bailey, a fellow former NGP investor. Before the pandemic, Rohini had been working on 5G infrastructure, and Chad was focused on the supply chain. At NGP during the pandemic, they observed that “the front half of enterprise(s), … have gone to the cloud, as they’ve gone to AI, it’s created over a trillion dollars of software value, everything from a Salesforce to ServiceNow.”

During this time of rapid digitalization, many older companies exposed a supply chain weakness. “(If) you look at the back half, … (the companies are) on a lot of old systems that were written 20, 30 years ago,” Rohini laments. “They’re still only partway through the cloud transition.”

Thus, Newbuild’s investment focus has been to build up the backend. “Anything from procurement to manufacturing software, to distribution, warehouses, logistics, payments, supplier intelligence.” Rohini claims, “There is an architectural shift happening which will unlock (the next) trillion dollars of value, so … we want to build a portfolio of companies that are squarely in that back half of enterprise focused on supply chain, all software.”