Why acclaimed investor Jim Breyer spends his time at the world’s great universities
Xfund is fortunate to count acclaimed investor Jim Breyer as a long-time supporter of the fund. Jim is known for being an early investor in dozens of companies, including Facebook, Etsy, Spotify, and Marvel; many of his investments have returned more than 100 times their cost. He is the founder and CEO of Breyer Capital and was previously a partner at Accel. Jim led Accel’s investment in Xfund and also invested in the fund via Breyer Capital.
Jim works closely with several prominent universities. He serves on the Advisory Board at the Tsinghua University School of Economics and Management. He is also a member of Harvard Business School’s Board of Dean’s Advisors, a member of Harvard University’s Global Advisory Council since inception, a founding member of the Dean’s Advisory Board at Stanford’s School of Engineering, and a Chairman of the Stanford Engineering Venture Fund, as well as a Founding Member of the Stanford Institute for Human-Assisted Artificial Intelligence Advisory Board, which was launched in March 2019. He currently serves on the University of Texas President’s Innovation Board and was formerly a Fellow of Harvard Corporation, Harvard’s senior governing board.
His work in China also extends to his position as co-chairman of IDG Capital, a leading investor in Chinese technology companies.
Here, Jim discusses his experiences working with universities in the U.S. and China, the importance of interdisciplinary thinking, and Breyer Capital’s move to Austin, Texas.
You’ve been a supporter of Xfund from its earliest days. Tell us how that connection began.
I became involved in Xfund through Patrick. I knew Patrick while he was at NEA and always respected him. In addition, my work, historically and today, involves spending a great deal of time with many of our great universities, both in the U.S. and globally.
At the time, I was on the board of Harvard Corporation, a member of the Advisory Board of the Stanford Engineering School, and a founding member of the Harvard Global Advisory Board. I’ve also spent 20-plus years on the Harvard Business School Dean’s Advisory Board. I have a strong belief that many of the best entrepreneurial opportunities and investments emanate from our great universities and colleges.
When Patrick told me what he was thinking about — a venture fund with Harvard as an initial anchor — it was very appealing in terms of the entrepreneurship opportunities and the idea of working closely with Harvard, Stanford, and other universities. I’ve been very pleased to be working with Patrick, now going on eight years.
What about Xfund made you excited to invest?
Xfund’s strategy goes right to where so many of the great opportunities start, which at one point was so much part of the fabric of venture capital. As funds have become larger, the opportunity to spend time brainstorming with professors and post-docs is sometimes more limited than it should be.
So, the opportunity from a strategy standpoint, to build something that integrates deeply with our universities, was appealing.
And again, I come back to Patrick: he’s very, very smart and very thoughtful. I’ve always enjoyed speaking with him about investment ideas. That combination of Xfund’s strategy and leadership was highly appealing.
You’ve worked with so many universities in the United States and China. What particularly excites you about the research these institutions are producing?
For the last four years, I’ve immersed myself in the world of artificial intelligence and have made 10 or so investments where AI and computing intersect with medicine and healthcare. These new opportunities represent a need for interdisciplinary thinking and deep expertise.
Much of that starts at the best universities, medical schools, and hospitals in the United States and worldwide. For example, to start a new AI medical company today, the founding team needs intellectual property in the form of differentiated data. It needs medical leaders. It needs scientists, and of course, it needs the best and brightest in AI and computing.
I find that our best universities in the U.S. have the world’s best talent in these fields. The challenge is to break down the silos between departments and schools, whether it’s Harvard, Stanford, MIT, or elsewhere. University leaders need to break down these silos so that physicists, biologists, and computer scientists are interacting — and not just professors. Post-doctoral students are increasingly important, as are partnerships between different schools. The other challenge is to build startups that understand the silos that need to be taken down.
Tsinghua University in China, where I’ve been an Advisory Board member for ten years now, is an outstanding engineering school, with incredible talent. It’s one of the great universities of the world. But what Tsinghua is missing, to some extent, is a deep integration with a great medical school and integration between departments.
For example, I was thrilled when Harvard announced last year that it had created an interdisciplinary quantum science and engineering PhD program. That, to me, is a hallmark of where many of our best universities in the U.S. will continue to lead worldwide and differentiate themselves.
Quantum technology is another of your investment interests, as you noted in an end-of-year update.
I’m increasingly focused on quantum technology as a fascinating and important long-term investment area. Yale, the University of Texas, Berkeley, Chicago, and the other universities I’ve mentioned are doing groundbreaking work in the field. In the U.K., Oxford, Cambridge, and Imperial College London are also doing outstanding work. Many of the best early quantum startups will emerge from these universities.
I believe that the world’s best 30 to 40 universities in AI research are highly concentrated. In Europe, the U.K., U.S., and China, quantum is even more concentrated.
I’ve been spending time informally brainstorming with the best physicists, many of which are Nobel Prize winners, as well as chemists, computer scientists, and leaders in the world of medicine. It will be these interdisciplinary interactions that serve the next great generation of founding teams in AI and subsequently quantum technologies.
You established a second office of Breyer Capital in Austin in 2020, at the height of the pandemic. What motivated that decision?
Actually, I started planning it well before the pandemic. I’ve been on the board of Dell for many years, so I’ve been coming to Austin four or five times a year for many years. For me, Austin encourages that culture of interdisciplinary collaboration that we just discussed, and not just from an entrepreneurial and venture capital standpoint. Artists, doctors, professors, filmmakers, and food entrepreneurs are all part of the ecosystem here, too. Austin also has a wonderful university that touches so many of the disciplines I feel are important going forward. It’s really exciting.
I’m a big believer that Silicon Valley, a decade from now, will be the greatest deep technology entrepreneurial center of the world, and that this will never change. At the same time, there’s a group of entrepreneurs on the West and East Coasts who have been deciding to leave for cities like Austin.
I’ve seen that over the past two years, a number of the most talented, high-potential 25- to 35-year-olds from Facebook, Tesla, Apple, Google, Oracle, and others are deciding to live in and around Austin. There’s an extremely vibrant entrepreneurial community that has been here a long time, but over the last two years, perhaps partly because of covid, it has greatly intensified.
I’m a strong long-term optimist in terms of Austin becoming one of the major innovative entrepreneurial ecosystems of not only the country, but of the world, over the next decade.
In your article for CNN, you explained your move to Austin in terms of its advantages, not Silicon’s Valley’s flaws.
Absolutely. Austin is a wonderful place, but there are other geographic areas of intense opportunity, like the life sciences in Boston and quantum and AI in the Bay Area, that are second to none. To be a national investor — or in my case, a global investor — you have to take into account that there are regional areas that have deep advantages in certain technologies, be it quantum, life sciences, or another field. Integrating all of that makes a huge difference.
What advice do you have for founders?
Go deep in one specific area of great passion, but at the same time, integrate other fields within your area of depth. It’s never been a better time for students, faculty, post-docs, and leaders in the academic community to be interdisciplinary in their thinking.
Depth in a specific field is extremely important for me as I look at startup investing. At the same time, broad critical thinking and pattern recognition skills are more important than ever, given that so many of the best opportunities sit at the intersections of many of these scientific and computing areas.
My advice is also to read voraciously. In addition, I continue to believe that if you’re passionate about a startup, no matter your age, whether it’s 20 or 65, you should pursue it with vigor. You should also spend a lot of time thinking about who you would like your co-founders to be. There has to be great chemistry, but at the same time, complementary skill sets.
