Podcast Summary: The Investor With Joel Palathinkal – Episode Featuring Andrew Karima of Cantos VC
Podcast Information:
- Title: The Investor With Joel Palathinkal
- Host: Dr. Joel Palathinkal
- Guest: Andrew Karima, Cantos VC
- Episode: Andrew Kirima: Cantos VC
- Release Date: August 14, 2025
- Description: The Investor with Joel Palathinkal is a global omni-channel show that highlights institutional investors from all walks of life and supports the continuing education for the next generation of allocators.
Introduction
In this enlightening episode of The Investor With Joel Palathinkal, host Dr. Joel Palathinkal engages in a deep conversation with Andrew Karima from Cantos VC. Andrew shares his unconventional journey into venture capital, his insights into the deep tech ecosystem, and offers valuable advice for aspiring investors. The discussion delves into various high-impact sectors, including nuclear energy, quantum computing, and brain-computer interfaces, providing listeners with a comprehensive understanding of the current and future landscape of venture investing in deep technology.
Andrew Karima’s Journey to Venture Capital
Early Life and Education
Andrew begins by recounting his diverse background:
- Kenyan Roots and American Upbringing: Born in Kenya, Andrew moved to the United States at age three and grew up in Washington State.
- Passion for Engineering and Sports: Inspired by sci-fi like Star Wars and Star Trek, he aspired to be an engineer. However, his interest in football led him to play at a junior college before ultimately pursuing his engineering dreams at the University of Arizona.
- Entrepreneurial Endeavors: During his senior year, Andrew co-founded Facade Technologies, a startup focused on automating desktop applications using Python APIs. Although the venture was short-lived due to the class of 2020 disruptions, it ignited his entrepreneurial spirit.
Transitioning to Venture Capital
Andrew’s shift from engineering and product management to venture capital was fueled by:
- Sencha Credit Experience: As CTO and co-founder at Sencha Credit, Andrew gained invaluable experience in team leadership and the challenges of building a startup. This role deepened his understanding of the tech ecosystem and expanded his network within venture capital circles.
- Content Creation and Networking: Before the pandemic, Andrew overcame his fear of public writing by starting a blog focused on deep tech. His consistent content creation and networking efforts on platforms like Slack and LinkedIn eventually caught the attention of Ian Roundtree, a founding partner at Cantos VC, leading to his role as a deep tech analyst.
Notable Quote:
"Atypical is pretty typical. Born in Kenya, moved to the States when I was 3... I was hungry for the whole entrepreneurial."
– Andrew Karima [00:28]
Skills and Qualities Essential for Venture Capitalists
From Product Management to VC Analyst
Andrew highlights the importance of diverse experiences:
- Leadership and Team Management: His time at Sencha taught him the intricacies of leading and managing teams, critical for assessing startup potentials.
- Content Creation: Building a blog demonstrated his dedication to deep tech and his ability to articulate complex ideas, which proved invaluable in his VC role.
- Persistence and Networking: Andrew emphasizes the significance of persistent yet respectful follow-ups when seeking opportunities in venture capital.
Progression within VC Firms
Moving from an analyst to an associate requires:
- Deal Flow Recognition: Developing the ability to identify and evaluate promising startups quickly.
- Understanding VC Jargon: Familiarity with industry-specific terminology and frameworks, such as defensibility and building a moat.
- Continuous Learning: Engaging in thorough diligence and leveraging advisors to validate investment theses.
Notable Quote:
"Writing a bunch of articles and content over deep tech stuff... proving the work rather than trying to wait for the proof of knowledge."
– Andrew Karima [11:28]
Deep Tech Trends and Investment Insights
Nuclear Energy: Fusion vs. Fission
Andrew expresses strong enthusiasm for advancements in nuclear energy:
- Fusion Challenges: Achieving sustainable fusion reactions requires extreme temperatures and robust containment technologies, making it a distant prospect.
- Fission Innovations: Interest lies in small modular reactors (SMRs), which offer safer, more flexible, and scalable solutions compared to traditional large-scale reactors.
Notable Quote:
"Fusion, which is a way bit out there, but fission... small modular reactors... a lot safer and also more mobile and flexible."
– Andrew Karima [23:32]
Quantum Computing
Discussing the future of quantum technology:
- Current State: We are in the Noisy Intermediate-Scale Quantum (NISQ) era, with significant technical hurdles like reducing noise and achieving fault tolerance.
- Potential Impact: Once stabilized, quantum computing could revolutionize multiple industries, though the timeline remains uncertain.
Brain-Computer Interfaces (BCIs)
Andrew is optimistic about non-invasive BCIs:
- Applications: From controlling machinery remotely to enhancing human capabilities, BCIs hold transformative potential.
- Challenges: Technical complexities and public acceptance, especially concerning invasive BCIs, pose significant barriers.
Longevity and Life Extension
On the topic of extending human lifespan:
- Technological Needs: While healthy lifestyles can contribute to longevity, technological advancements in genomics and drug discovery are essential for pushing the boundaries beyond current limits.
- Long-Term Vision: Deep tech in biotech could enable significant life extension, although it remains a long-term goal.
Notable Quote:
"We're talking about decades here. Deep tech investors will invest in companies that might not make backable returns in like 10 to 12 years."
– Andrew Karima [19:17]
Deal Sourcing and VC Philosophy
Sourcing Strategies
Andrew outlines effective deal sourcing methods:
- Building Relationships: Engaging with founders, attending ecosystem events, and networking are crucial.
- Content Creation: Writing insightful articles and conducting interviews can attract attention from both entrepreneurs and investors.
Philosophical Framework
Cantos VC operates based on the "seven powers" framework, focusing on:
- Defensibility and Moats: Protecting intellectual property and building sustainable competitive advantages.
- Market Opportunity: Evaluating the addressable market and future growth potential.
- Feature Addressable Markets: Assessing how technologies can scale and adapt to future demands.
Notable Quote:
"Our entire framework is based off of seven powers... how are you going to build your moat."
– Andrew Karima [16:26]
Ecosystem Insights: Austin vs. Dallas
Austin’s Thriving Tech Scene
Currently based in Austin, Andrew shares his observations:
- Vibrant Growth: Austin is experiencing a surge in entrepreneurial activity, similar to Miami but with a more robust tech foundation.
- Community Engagement: Initiatives like unofficial Austin Tech Week are fostering connections and driving innovation.
Dallas Perspectives
While Cantos is headquartered in San Francisco, Andrew notes positive developments in Dallas:
- Emerging Opportunities: Dallas is gaining traction with an increasing number of startups and investment activities, though detailed insights are limited.
Notable Quote:
"I'm in Austin, and I absolutely love it. There's a lot of opportunity out here to capture... people are really hungry builders."
– Andrew Karima [62:26]
Advice for Aspiring Venture Capitalists
Andrew offers practical advice for those looking to enter the VC industry:
- Prove Your Work: Focus on creating tangible outputs, such as writing, building projects, or sourcing deals, to demonstrate your expertise.
- Understand the Firm’s Philosophy: Research and align with the investment philosophy of target VC firms.
- Continuous Diligence: Engage in thorough research and leverage advisors to validate investment opportunities.
- Build a Presence: Actively participate in communities, contribute valuable insights, and maintain a persistent yet respectful approach when networking.
Notable Quote:
"Don’t be a jackass, just be open to listening to other people... personal fiduciary responsibility to give that time of day to founders."
– Andrew Karima [30:41]
Conclusion
Andrew Karima's journey from engineering and entrepreneurship to a pivotal role in Cantos VC underscores the value of persistence, continuous learning, and proactive networking in the venture capital landscape. His insights into deep tech sectors reveal both the immense potential and the significant challenges awaiting investors. For aspiring VCs, Andrew’s emphasis on proving one’s work, understanding firm philosophies, and building meaningful relationships offers a roadmap to success in this competitive field.
Final Notable Quote:
"Proving the work rather than trying to wait for the proof of knowledge."
– Andrew Karima [40:11]
Key Takeaways:
- Unconventional Paths: Ventures into VC often come from diverse and non-linear career paths.
- Deep Tech Focus: Areas like nuclear energy, quantum computing, and BCIs are ripe with investment opportunities despite their long-term horizons.
- Essential Skills: Leadership, content creation, deal flow recognition, and understanding industry-specific jargon are crucial for success in VC.
- Ecosystem Engagement: Active participation in tech ecosystems, especially in burgeoning hubs like Austin, is vital for networking and deal sourcing.
- Advice for Aspirants: Demonstrate tangible work, align with VC philosophies, and maintain persistent yet respectful networking efforts.
Connect with Andrew Karima: For those interested in deep tech and venture capital, Andrew Karima can be reached via Twitter or email for further discussions and insights.