“Alibaba, the Chinese internet giant, made a frenzied debut on the New York Stock Exchange on Friday ending its first day as a public company valued at over $231bn, more than Facebook or Amazon and eBay combined”, according to the Guardian. At the same time, Jack Ma, Alibaba’s founder, has admitted that in the beginning of his entrepreneurship, Alibaba was turned down by a number of VCs. Therefore, articles about those VCs who could wait until Alibaba’s IPO are widely spread. As a matter of fact, how to identify an entrepreneur before they’ve founded anything raised a question mark in investors’ minds.
Backed by Bloomberg LP, the financial data and news company, Bloomberg Beta is going to fulfill this vision: it’s using an algorithm to try to select would-be entrepreneurs before they’ve even decided to start a company.
How does this model work?
“…together with Mattermark, we built this model based on data from past and present venture-backed founders and we used it to try and predict, from a pool of 1.5 million people, the top 350 people in Silicon Valley and New York, which is where we’re focused, who had not yet started a venture-backed company but we believed would do so. And so that’s what we did and we reached out to them.” – Roy Bahat
After the model, what’s next?
“…the most valuable thing in the program is the relationship they can form with each other and with actual start-up founders. And so we started hosting lunch once every other week with a small group of these future founders and some of our portfolio companies and friends in the industry and it’s been great. The response has been terrific.
Our goal with them is to simply support them in achieving what they want to achieve in their careers because whether or not they end up starting a company, these people all have enormously high potential and some of them might end up being executives who we partner with at other companies. Some of them end up being recruits for our portfolio companies. Or some of them might end up inspiring us with ideas and being friends.” – Roy Bahat
Read more about HBR’s interview with the head of the fund, Roy Bahat.