An Inside Look into the World of A CIO & Venture Capital Investor

Welcome back to Bill Murphy’s 10x Podcast. Our guest in this episode is John Arsneault, CIO at Goulston & Storrs, a venture capital investor, and startup advisor. With over 30 years in the tech industry, John is an expert business growth strategist.

John began his career repairing PCs at an after-school job before transitioning to work for a small venture capital company in Boston. Through this experience and by observing his co-workers making investment deals, he discovered his passion for investing.

Today, John is the founder of Portfolio X, a venture capital company that invests in emerging technologies. John is passionate about offering investing advice, and emphasizes the importance of betting on a person, not their ideas. John also talks about his role as a CIO and strongly encourages us to be the curators of change within our organizations.

In addition to his useful advice, John shares with us his family roots in Maine, his love for baseball, and explains to us that we do not need a grand plan to be successful. Through hard work, making mistakes, and multiple attempts, growth is achieved, and remarkable things happen.

Oh, and did someone say flying cars? Tune in to learn more.

As a CIO and Business IT Leader here are some wins you will get by listening:

Bill [11:12] “There is some wisdom in non-traditional paths as far as what growth opportunities it gives people.”
John [12:42] After working at a small venture capital company in Boston, John developed a strong interest in investing.
John [13:12] There are two streams of technology professionals in the world. The people that maintain technology environments for enterprise or existing businesses. Then there are people that work in the actual tech industry.
John [13:42] Realizing you could go work for a technology company and be the product itself, not just the back office necessary expenditure, was exciting because this meant that you are building an actual product while earning equity.
John [15:42] Everything a person learns is the outcome of watching, making mistakes, and trying a couple of times until they got it right.
John: [16:12] The biggest mistake that people make when entering the world of investing is, they get so enamored with somebody’s idea. There are lots of entrepreneurs that have cool ideas. There are very few of them that can turn that idea into a functioning burgeoning business.
John [16:42] In these days investing is cloudy because it is easy to get venture capital, but in the past, it was hard. So, people assumed that if somebody got funded the company was destined to do well, however 90% of new businesses fail.
Bill [17:12] Are we betting on the idea? Or are we betting on a growing business?
John [17:42] You bet on the entrepreneurs themselves and not the ideas.
John [18:42] When investing, be on the side of something that has already proven itself in the marketplace, has brand recognition, and seems obvious that it’s the new way to do it.
John [20:42] Over the last five years, everything has become a technology startup. Even existing businesses in a way are becoming technology startups within themselves.
John [23:12] You have no crystal ball. You do not know if entrepreneurs are going to guide the business properly, but to make an informed decision you can look at what they’ve done and how they’ve gotten to that point.
John [24:42] Private market exchanges
John [28:42] You can do all the homework in the world, at the end of the day you just do not how things are going to turn out.
John [31:12] A spec is a special all-purpose collection of equity investors.
Bill [34:42] Apps and technologies are so quick that they outstrip our ability to regulate.
John [35:12] The next iteration of innovation is going to be technologies that bump up against compliance and regulation.
John [36:12] There is technology that already exists but is not being utilized because it’s not yet legal.
John [37:12] Regulation and compliance must catch up with technology, or the technology is going to slow down.
John [39:42] 40% of the world’s population have never been on the internet.
John [40:42] People can suddenly go from being behind the rest of the world by a hundred years, but in a split second can be ahead of everybody because their adoption rate will not be getting rid of the old thing but going right to the modern setup.
John [40:57] The biggest barrier for the United States to be competitive in the next hundred years is going to be our will to adopt new things.
John [43:42] A CIO’s role traditionally in a law firm was to put together the technical Legos to make people efficient and allow them to do their jobs. However, in the next decade, the CIO’s role is going to be to help protect the business.
John [44:42] Innovators are coming into the legal industry with no intention of taking the technology that they develop and licensing it to law firms. They want to build platforms that will allow them to take clients away and build processes that facilitate legal happenings within the platform itself.
John [46:20] It took Amazon 25 years to build their successful e-commerce fulfillment model that disrupted the rest of the industry. Once companies realized where they were failing, it was too late
John [47:42] I can’t tell them, this is exactly how they need to approach all this innovation, but I can tell them that they need to pay attention. There are going to be moments of clarity, you must watch for it.
John [51:42] As a CIO, look outside your own industry for what is going to happen.