Born: Kingston, Ontario, Canada
Schooled: Ivey Business School (MBA), The University of Western Ontario (BA)
Worked: Panorama Capital, JP Morgan Partners, Digital Island, Newbridge Networks
Lives: Larkspur, CA
by Mike Jung
I've known and worked with Chris for the better part of 18 years, starting when he was at Newbridge Networks (NYSE: NN), where he ran the corporate venture arm. I was at Robertson Stephens, and advised on the sale of a few companies in their portfolio.
Chris is like a moth attracted to the flame of change. Where others in Chris's Canadian community saw risk and uncertainty, he only saw interest and fun. How else do you explain someone who chose to go to Russia in the last years of communism, relished being on the ground amidst the coup, and watched with amazement Yeltsin's tank-top rise to power. Let's just say his mom was not happy.
It's that same mentality that drove him to join a Welshman, Sir Terry Matthews, who envisioned a core data networking backbone of what became the interwebs. Keep in mind that the data network didn't exist at the time and the vision was an audaciously huge one. As a member Newbridge's executive team, Chris was an important part of building that company from zero to $2 billion in revenue.
It was during this chapter that Chris got his first taste of the problem that would one day become Founders Circle. He was among a group of people whose window to sell stock on the public market was perpetually closed. The only way he could afford a house for his family was to take a loan from his father-in-law, which he desperately wanted to pay-off. Don't get me wrong, Chris got along famously with his father-in-law, but being in debt is not what his depression-era grandfather taught him.
Unfortunately, there was no solution for Chris. He couldn’t find anyone willing to let him use his vested stock as a currency.
Soon enough, a new flame attracted the moth: Digital Island. Excited and energized, Chris picked up the family and moved from Ontario to San Francisco where they bought a home, sight unseen, and sold the other, all online. But, it turned out that the value of a house in Ontario didn't come close to covering the cost of a house in San Francisco. So Chris had the very uncomfortable task of asking for a loan from the company (you could do that then).
As the company prospered and the family grew, the pressure valve started to build-up all over again for Chris. Balancing the 24/7 life of building a global business with that of building a family life became a real challenge. Being a startup founder makes you not very present for your loved ones. It's said that money can't buy you happiness, but it sure can buy you time. Chris wanted to spend his scarce spare hours teaching his kids to play baseball, not washing the windows or mowing the lawn. A little financial relief would have allowed for that. Instead, he watched Digital Island go from a $600 million market cap to a skyrocketing $13 billion, then free fall down to $500 million. It was ultimately acquired for $700 million by Cable & Wireless. Because he was an insider, he couldn't pull a single dollar out for his family. Chris' experience wasn't unique. Nearly all of the senior management had their own personal financial issues they were trying to resolve and everyone suffered the agony of not being able to use their valuable vested shares as the solution.
Fast forward a handful of years, Chris and I joined JP Morgan Partners, which later became Panorama Capital. It was there that three seminal moments converged into what would become Founders Circle.
The first was with John Battelle, then the Founder & CEO of a young company that would come to disrupt the technology media and conferences business: Federated Media. (Fast forward to today and John is chair of The Circle, a community of peers we've organized.) It might seem cliche, but quite literally, Chris met John at his kitchen table discussing how he, the co-founders, the management team and the investors were all on different timetables. He was seeking a solution where everyone could get aligned for the long term. That's when Chris led a JPMP financing that was a combination of both primary and secondary shares.
Next came a series of conversations with Tim Kendall, who worked with Chris at JPMP and then went on to join Facebook as one of its earliest employees. Chris's coaching conversations with Tim were mostly about managing a rapidly scaling business. As the business became sound, those conversations gravitated to how Tim was going to pay off his student debt from his years at Stanford University. This was a not-inconsequential sum that was a real distraction for Tim. By then, JPMP had evolved to become Panorama Capital and, unfortunately, I was among the partnership who had to decide that a secondary transaction just wasn't in our charter in the eyes of our limited partners. Frustrated by that outcome, Chris knew there had to be a thoughtful mechanism to address these kinds of needs.
The closer moment for Chris was a series of coffee conversations with Dick Costolo who was then stepping up to the CEO role at Twitter. Most of those talks were brainstorming ideas on how to carefully architect getting all of the management team on the same page to build towards an IPO that was still years away. Dick wanted the executive team to not be worried about their families’ security and to get fired up on the good work that lay ahead for the company. He graciously offered Panorama the opportunity to participate in a limited secondary, but again, it wasn't in our charter (I know, first Facebook and now Twitter. But give us credit for being disciplined). Kleiner Perkins ended up doing a handsome primary/secondary financing for the company.
But, that's exactly when it all came together. After the deal, Dick took Chris out for another coffee. He slammed his fist on the table (that's literal, not theatrical) and insisted "you've got to go do this. It's happening all over the valley.” Right then, it just clicked.