Hemant Taneja: The Venture Investor Everyone Should Know

March 17, 2021

Not all venture capitalists are created equal. With the proliferation of new investors and new funds, it has become increasingly difficult to tell the bad from the good, the good from the great, and the great from the extraordinary

Hemant Taneja falls under the extraordinary category and still manages to be underhyped. With Hemant, there is no choice between impact & returns. He shatters straightforward metrics like AUM, returns, and previous experience and simultaneously embodies many of the other dimensions that have become important in measuring an investor’s caliber. He is a thought leader for responsible company building, thoughtful implementation & intentionality of AI, D&I, and the intersection of health and technology.

This post is a short compilation of some of his work & ideas for others to learn about. We need more investors, entrepreneurs, and citizens of the world that think like him and awareness is the first step in that journey.

Hemant’s content feels like having a light delicacy. It is just enough to feel satiated but not saturated. There is a simple richness to it that leaves you feeling refreshed. There are few people whose values I feel more aligned with and have profoundly shaped the entrepreneur I hope to become.

Who is Hemant Taneja? Biography Facts (Compiled from General Catalyst & Commure Prospectus)

I have yet to figure out how Hemant manages to stay sane despite the variety of companies and subjects he covers. If anyone has a second brain it is him. I am including these “resume accomplishments” to illustrate the breadth and depth of Hemant’s influence.

  • Selected investments:  Anduril, Stripe, Applied Intuition, ClassDojo, Coda, Color, Grammarly, Gusto, Livongo (NASDAQ: LVGO; acquired by Teladoc), Mindstrong, Canva, Nova Credit, Samsara, Snap (NYSE: SNAP), Spring Discovery, Digit, and ThoughtSpot.
  • Founder and executive chairman of Commure, which is building software infrastructure to transform the healthcare space. 
  • Co-Founder of Advanced Energy Economy, an organization focused on transforming energy policy in America since 2011.
  • Founding Board Member of the Khan Lab School, a nonprofit K-12 school dedicated to classroom innovation since 2014.
  • Board of Fellows for the Stanford School of Medicine
  • Part-time lecturer at Stanford teaching A.I., Entrepreneurship, and Society and MIT teaching the Founder’s Journey. 
  • MIT alumni with 5 degrees (Crazy, I know!): M.Eng. EECS, S.M. Operations Research, S.B. Biology, S.B. Mathematics, and S.B. EECS.
  • Current board member at Teladoc Health, Ro, Samsara, Gusto, Grammarly, Applied Intuition, Mindstrong, Anduril, Fundbox, Color, Digit, Nova Credit, ThoughtSpot, Coda.
  • Former board member for Stripe and Livongo.

A Crash Course on Hemant Taneja 

Hemant is not a regular content publisher. Every year he publishes 3-5 content pieces that build on each other over time. I selected what I think provides the best bird’s eye view of his ideas and list them out in my recommended reading order.

UnHealthcare: A Manifesto for Health Assurance (Book by Hemant Taneja, Stephen K. Klasko, and Kevin Maney) (Link)

This book is not a book. It is an invitation to join the “Health Assurance” platform. The Health Assurance platform aims to eliminate the barriers to healthcare delivery for all. However, unlike other initiatives in healthcare, it attempts to do so with collaboration vs. disruption, existing healthcare players, empathy, AI, data analytics, policy, and partnerships.

I devoured this book in a single afternoon because I found that it made reading about healthcare easy and approachable. It also builds on previous content from Hemant. It is a quick way to scratch the surface of his investment thesis, personal values, and areas of interest.

Favorite quote: “Most debates about healthcare among U.S. politicians center around the best ways to have American citizens afford the old healthcare system. But asking who pays—the government, consumers, or employers—is asking the wrong question. The right question is: How do we enable risk-takers in technology and healthcare to partner and create a transformative approach to lifelong health for all?”

The Era of Move Fast and Break Things is Over (Link)

If you are a founder building something big and impactful it is your responsibility to think about its impact on society. It is the least you can do. 

This is an article that helps founders think about their product/company in a complex system through 8 thoughtful questions. It forces you to think about how you are planning to evolve your business over time to create a world we all want to live in.

Favorite quote: “It is intellectually inconsistent to preach about a disruptive, billion-dollar vision and imagine it as being free from regulatory considerations. It fascinates me how often entrepreneurs lack a basic grounding in the regulatory hurdles they may face. At a minimum, founders must know who the key decision-makers in their market are and think through how and when it makes sense to engage with them”

Unscaled: How AI and a New Generation of Upstarts Are Creating the Economy of the Future (Link)

If UnHealthcare and Unscaled were wine bottles UnHealthcare would be the better vintage.UnHealthcare builds on the thesis & concepts of Unscaled.

In Unscaled Hemant argues that “In the twenty-first century, technology and economics are driving the opposite —an unscaling of business and society. This is far more profound than just startups disrupting established firms. The dynamic is in the process of unraveling all the previous century’s scale into hyperfocused markets.” Companies are focusing on consumers, building products around them, and then renting scale to take advantage of the market opportunities.

A neat section focuses on Modern Monopolies (those built around data and algorithms) and their regulation. The argument is that in the 20th century we used geographic constraints and pricing to regulate monopolies but that no longer works because their value comes from their ubiquity and thus breaking them apart doesn’t work. Instead, he suggests we should use regulation to enabling access to at least 2 of the 3 layers modern monopolies are built on: data, algorithms, and consumer graphs.

Unscaled 7: The Future of Companies (Link) & Unscaled 8: The Best Time in the History of the Universe (Link)  – All Turtle Podcasts

Thinking of quitting your job to build a company? 20 minutes of this and you will jump off the corporate job train. A couple of reasons Hemant lists on why there has never been a better time to start a company:

  • Business structures have never been more flexible through remote work and ease of access to the already built infrastructure. 
  • We have the combination of network effects (Metcalfe´s Law) and Moor’s Law to take advantage of.
  • Broader sources of funding in all geographies
  • D&I as an investment focus
Health Assurance Acquisition Corp (NASDAQ: HAACU) – Prospectus (Link)

Beware! This is not light reading. It is 150 pages of a lot of legal speech and some substance. However, it is one of the few real windows you will get into Hemant’s management style, the people that work alongside him, and his practical approach towards building the Health Assurance platform.

For those who are curious, a SAIL (Stakeholder aligned initial listing) is the more transparent & aligned version of a SPAC (Special purpose acquisition company). In a SAIL the sponsor gets a smaller promotion fee (5% vs. 20%) and then obtains additional shares based on the performance of the acquisition target in the future.

Stanford ETL Speaker Series: Hemant Taneja, General Catalyst – (Link)

Say hello to Hemant the venture investor. With such a wide area of influence (founder, board member, chairman, advocate, academic, author, philanthropist, etc.) it is easy to forget that Hemant’s backbone is venture capital. 

This talk is the most recent publicly available talk (March 2021) where Hemant talks about how his firm (General Catalyst) differentiates from others, how he looks for leverage points his portfolio companies can use, what having a builder’s mindset means, how to alleviate failure modes, amongst others.

If you are pitching to Hemant or want to refine the way you evaluate your investments this a good way to understand the basics.

Favorite quote: “This period of innovation there is a false choice between impact and returns. It used to be that you invested in either, but I’d say the best businesses and most impactful innovation will be at the intersection of impact & returns.”

For Stanford Students

Hemant occasionally teaches courses at Stanford. I had the pleasure to take a seminar class he taught back in 2016 where he brought in speakers like Sam Altman and Glen Tullman to have thoughtful discussions (I wish I had a better appreciation of how great he was then). I found especially enjoyed how he weaved big ideas into his investment narrative. His most recent course is CS 28: Artificial Intelligence, Entrepreneurship, and Society in the 21st century and beyond. If you have a chance take his course!