20VC Why I Do Not Regret Taking 'Peter Thiel Money', What Is The Difference Between Leadership & Management & What Conversations Are For The Founding Team Only with Tim Junio, Founder & CEO @ Qadium

Summary Notes


In this episode of "20 Minutes VC," host Harry Stebbings interviews Tim Junio, co-founder and CEO of Cadium, a startup that collects knowledge about the world's devices, backed by Founders Fund and NEA. Junio, a former CIA employee and research affiliate at Stanford, discusses his transition from government work to tech entrepreneurship, emphasizing the leadership and management challenges that come with scaling a startup. He shares insights on fundraising, including the importance of conveying a company's long-term vision to investors, and reflects on the value of taking investment from controversial figures like Peter Thiel. Junio also touches on the wastefulness he observes in Silicon Valley funding and his ambitious vision for Cadium as the leading brand for Internet of Things analytics.

Summary Notes

Introduction to Tim Junio and Cadium

  • Tim Junio is the co-founder and CEO of Cadium, a startup focused on aggregating knowledge about the world's devices.
  • Cadium has received backing from notable investors such as Founders Fund, NEA, and Susa Ventures.
  • Tim's background includes work at the CIA, the office of the Secretary of Defense, the Rand Corporation, and DARPA.
  • He holds a research affiliate position at Stanford, lecturing and advising on cybersecurity.

"So joining me in the hot seat today, I'm thrilled to welcome Tim Junio. Tim is the cofounder and CEO at Cadium, the startup that creates an all organizers knowledge about the world's devices."

This quote introduces Tim Junio and his company Cadium, highlighting its focus and his professional background.

Tim Junio's Career Transition from Government to Tech

  • Tim Junio originally planned a career in the intelligence community but left due to dissatisfaction with the bureaucracy.
  • He pursued a PhD with the intent of becoming a professor in cybersecurity.
  • A fellowship at Stanford introduced him to the tech industry in Silicon Valley, which he found more meritocratic than academia or government.
  • Tim and his co-founders at Cadium started with defense department grants instead of VC funding to prototype their technology ideas.

"But when I started to think about what it would be like to exist in a large bureaucracy for decades, and the kind of repeat iteration games that people play who are interacting over the course of 20 years, it's a highly politicized, very charged environment and wasn't something that I thought was going to be satisfying..."

This quote explains Tim's decision to leave a career in the intelligence community due to the bureaucratic and political nature of the work.

"...it's almost impossible to fuck up in working in tech in Silicon Valley, you will have a good outcome if you are a smart and hardworking person."

Tim Junio expresses his view on the meritocratic nature of Silicon Valley's tech industry, suggesting that intelligence and hard work lead to success.

"...we didn't start Kadium with a specific product idea. We had some prototype ideas, and we applied for grants from the defense department to begin working on them."

The quote details the early stages of Cadium's development, where the focus was on prototyping with defense department grants rather than starting with a set product idea and VC funding.

Unique Funding Path for Cadium

  • Cadium is unique in its initial funding approach, having started with military grants instead of traditional venture capital.
  • This approach allowed the company to focus on technology development and prototyping before seeking VC investment.

"We didn't take VC money from the beginning. We took military money from the beginning to test out some ideas."

Tim Junio discusses Cadium's initial funding strategy, which involved military grants to fund the testing of their technology ideas.

Management Experience as a Co-Founder

  • Tim Junio's transition to becoming a co-founder involved learning management skills, which is a common challenge for many first-time founders.

"And a lot of co founders have never actually been managers before. So I'm really intrigued as to hear from you..."

This quote sets up a discussion on the management experience of co-founders, acknowledging that many have not had such roles before starting their companies.## Understanding the Role of a Startup Co-founder CEO

  • The job of being a co-founder CEO is extremely challenging and cannot be fully understood until one is in the position.
  • The responsibility includes convincing highly skilled individuals to take a significant risk by joining a startup.
  • Leadership and management are distinct skills that must be developed separately.

"It is as hard as everybody says, and you cannot actually understand it until you're in the job."

The quote emphasizes the difficulty of the co-founder CEO role, which is often underestimated until experienced firsthand.

"To have weight on your shoulders of giving absolutely brilliant people this very, very high risk choice and convincing them to follow your path is one of the most stressful things that you can do."

This quote highlights the responsibility and stress of recruiting top talent to a high-risk startup environment.

Leadership vs. Management

  • Leadership involves recruiting the best people and executing an idea, especially under challenging circumstances.
  • Management becomes critical when the team grows beyond a certain size, affecting communication patterns.
  • The transition from leadership to management requires reinforcing key messages to maintain alignment with the company's vision.

"Leadership and management really are two different things."

This quote distinguishes between the two roles, implying that both skill sets are necessary but separate.

"Once you start getting to not even a huge scale, but just crossing, I think 15 engineers is kind of a magic number for me, at least. It becomes really hard to get your intent across."

Tim Junio discusses the challenges of scaling a team and the importance of clear communication as the company grows.

Learning Through Trial and Error

  • The learning process for running a company involves a significant amount of trial and error.
  • Understanding HR law, accounting systems, and government contracting is part of the learning curve.
  • Strong mentors, other founders, senior executives, and investors can provide valuable guidance.

"The basic way in which I think most people learn it is trial and error."

Tim Junio acknowledges the common method of learning through making mistakes and learning from them in the startup world.

Advice from Mentors

  • Some decisions as a co-founder are non-negotiable and should not be open to group discussion.
  • The company's core identity and direction should remain consistent, even as the culture evolves.
  • It is important to recognize which aspects of a company's ethos are fundamental and unchanging.

"There are some non negotiable things that are just co founder decisions and you shouldn't discuss them as a group."

This quote reflects the advice that certain decisions should be made solely by co-founders to maintain the company's vision and direction.

Fundraising Experiences

  • Fundraising is a critical element for co-founders, and the approach taken can greatly impact success.
  • Non-intuitive advice can be particularly beneficial during the fundraising process.
  • It is important to consider how the core technology or platform of the company is presented to potential investors.

"One of the best pieces of nonintuitive advice I got during fundraising, which I think I used to, our advantage was from a friend of mine, Adam Getty, who's the co founder CEO of Ionic Security."

Tim Junio shares a piece of advice that helped him during fundraising, emphasizing the value of insights from experienced peers in the industry.## Communicating Vision in VC Pitches

  • Tim Junio emphasizes the importance of conveying a long-term vision for a company when pitching to venture capitalists.
  • The consensus in the room during a partnership pitch is crucial and won't focus on product nuances.
  • Kadium's vision was reframed to be seen as a major player in the Internet of Things space, akin to "Google for the Internet of things."
  • The focus should be on the company's potential impact and brand rather than just the immediate product launch and revenue.

"What is the company doing on a multi decade time horizon? Because when you go and do vc pitches, you're going to have one partner who completely understands what you are doing through all of the nuance of the product that you are launching and why and who the initial customers are, et cetera. But when you do the partnership pitch, you need to achieve a consensus very quickly in that room of people, and they're not going to get into the nuance of why you're tackling security first."

This quote illustrates the necessity of presenting a clear and ambitious company vision to venture capitalists, particularly in partnership pitches where detailed product nuances are less important than achieving consensus among the partners.

Investor Relations and Strategy Communication

  • Tim Junio reflects on the need for better communication with existing investors about the company's strategic direction.
  • Existing investors were concerned about the focus on government business and saw enterprise efforts as a potential distraction.
  • Junio wishes he had more strategically handled investor relationships and involved them earlier in the decision-making process.

"So during this series a, we had a bit of an uncomfortable conversation with some of our existing investors because we were charting our course when asking for more money."

This quote highlights the challenges faced during Series A funding when aligning existing investors with the company's new strategic direction, emphasizing the importance of early and strategic communication.

Perspectives on Controversial Investors

  • Tim Junio discusses his experience with investor Peter Thiel and addresses the controversy surrounding Thiel's political views.
  • Junio has no regrets about taking Thiel's investment and praises his brilliance and contributions to tech companies.
  • He references Sam Altman's blog post to articulate why he believes it is unreasonable to reject business relationships based on political affiliations.
  • Junio argues that distancing from Washington due to controversial figures would be a poor choice for tech companies.

"Peter is one of the most brilliant and interesting minds I have ever met, and certainly the most so since moving to Silicon Valley. And I personally have no regrets about having taken his investment, and I would do so again in a heartbeat."

This quote conveys Junio's high regard for Peter Thiel as an investor and his lack of regret in accepting Thiel's investment despite any political controversies, emphasizing the separation of business acumen from political views.

Silicon Valley and Washington Relations

  • Tim Junio expresses the importance of Silicon Valley's relationship with Washington, D.C., and the potential for tech companies to contribute to federal initiatives.
  • He mentions the involvement of tech companies in various government projects, such as the Pentagon's innovation efforts and the White House's digital service.
  • Junio believes it would be a mistake for tech companies to avoid engagement with Washington due to political controversies.

"A lot of these initiatives are suggesting that on the East coast, they recognize we have something out here that is special in Silicon Valley and what we have been able to create."

This quote emphasizes the recognition by the East Coast, particularly Washington, D.C., of Silicon Valley's unique capabilities and the opportunities for collaboration between technology companies and the federal government.## Favorite Book and Reasons

  • Tim Junio's favorite book is "Snow Crash" by Neil Stephenson.
  • He admires the universe constructed in the book, especially the visionary depiction of virtual reality.
  • The interwoven narratives between technology and politics in the book are particularly impressive to him.

Snow Crash by Neil Stevenson. I think the universe he constructed is absolutely amazing. True visionary in what virtual reality could be like, as well as the political dynamics of kind of the highly fragmented United States. Just absolutely incredible. Love the interwoven narratives between technology and politics. Absolutely amazing.

This quote explains Tim Junio's admiration for "Snow Crash," highlighting the book's creative universe and its insightful take on technology and political dynamics.

Challenges as a Manager

  • Tim Junio is challenged by improving as a manager, especially in edge cases.
  • Concerns include scaling the team at KDM and executing at larger scales.
  • There is no formulaic solution to scaling challenges; they require case-by-case management.
  • Assembling a strong team, including in people management, is a strategy to address these concerns.

So almost certainly the kind of edge cases of how I improve as a manager is what worries me the most. I feel like the product and the technology are spectacular at KDM, and what I'm most worried about is how things break at different scale.

This quote reflects Tim Junio's focus on improving as a manager and the worries associated with scaling a company, emphasizing the lack of a one-size-fits-all solution and the importance of team assembly.

Worst Elements of Silicon Valley

  • Tim Junio is critical of the funding of unproductive ventures in Silicon Valley.
  • He believes there is a waste of human talent on trivial projects.
  • The downturn in the VC market in early 2015 was seen positively by him as it could redirect talent and capital to more productive businesses.

Am absolutely amazed at some of the shit that is funded out here. [...] I really think that there is enormous human talent being wasted here on highly unproductive activities.

This quote criticizes the funding decisions in Silicon Valley, expressing concern about the misallocation of talent and resources.

Favorite Blog/Newsletter

  • Tim Junio enjoys reading The Points Guy for pleasure.
  • For cybersecurity, he recommends Bruce Schneier's blog, "Schneier on Security."
  • For large-scale data analytics, he is a fan of Flowing Data.

Bruce Schneier has a fantastic blog called Schneier on security that is probably the best in class for the right balance between thoughtful, technical and focusing on the social implications of technology. And in terms of large scale data analytics, I'm a big fan of flowing data.

The quote lists the blogs that Tim Junio finds valuable for professional insights into cybersecurity and data analytics, highlighting the balance of technical and social perspectives.

Hypothetical CEO Role

  • Tim Junio would choose to be CEO of a company like Amtrak or United Airlines.
  • He is curious about the internal challenges these companies face in improving their products.

I think I would try to be the CEO of something that seems absolutely abysmal from the outside, like Amtrak or United Airlines, because I don't understand externally why it is so hard to make their products better.

This quote reveals Tim Junio's interest in understanding and tackling the internal challenges of companies that struggle to improve their offerings from an outsider's perspective.

Vision for KDM

  • KDM aims to be the leading brand for Internet of Things (IoT) analytics.
  • They regularly sense everything connected to the public Internet.
  • Their data has applications beyond security, including market research and business intelligence.
  • KDM's data provides unique insights into the Internet's structure, as noted by an advisor.

So we are intending to be the brand for Internet of Things analytics. [...] One of our advisors, Dan Bonet from Stanford, he's a professor of computer science there, remarked that he has never seen anything like our data, and they have entire academic conferences attempting to approximate what we have running in our commodity cloud services from what KDM has gathered.

This quote conveys the grand vision for KDM, highlighting their unique position in IoT analytics and the unprecedented nature of their data as recognized by experts in the field.

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