Exclusive Interview: From $100K to a $1B Balance Sheet & 700 Employees

0:02So we are all here, thanks to Saeed, because we are inside of his venue, which is well known by many people in Silicon Valley in the Bay Area. He started this business in 2006, although the history goes back to 1992. I was reading in the book you gave me upstairs. So in 2006, he got started and now they have over 70 locations, 100 employees, 25 different verticals, partnerships with 40 universities, including Stanford University, which we've done a lot of investments through. If I have my notes right, I think they made three to five investments just today. They've done 2 ,500 investments, and that's when the book was published nine months ago.

0:37They have over a billion dollars in assets and over 550 corporate partnerships with companies like 3M, General Electric Types, et cetera, that everybody would recognize the names of. So Google rented space in his office when they were at 12 employees. PayPal was here in their early days, and the idea for Logitech was also created inside of his building. So that's just a little background on Plug and Play, which is essentially his family office slash incubator business platform, which he's scaled up enormously. So let's welcome Saeed here to the stage. Thank you, Richard. It's great to be here.

1:11I was going to welcome you to Plug and Play, but you guys got more than you asked for. So you're going to even get some more history. To mention, Richard, we still have that little building on University Avenue in Palo Alto, where Google went to 50 people, PayPal went to 50 people, and Logitech. So I brought some of that luck from that Palo Alto building to here about 20 years ago. This was the headquarter for Philips Semiconductor, where the shopping center is. It used to be a fab. And as people said, now hopefully manufacturing will come back. But it seems like it's going to Arizona more than California, Florida, Texas, and Arizona.

2:00But it's lovely to be here and to be part of the program. Yes, awesome. Thank you for having us here. And what did I miss from your bio that you think is really important and you wish I would have added so people understand you better? The family office, we are involved in real estate. I do have traditional, I need to speak to the water business, but I have a large packaging and water business, which is about a billion dollar in revenue for a thousand people. And those are the businesses that I built from 1979. And because I was in Palo Alto on University Avenue next to Stanford, we occasionally met startups and we invested in them as an angel.

2:47And that really was my hobby. And initially, we did four or five investments a year. But when I, for example, invested in Dropbox 100 ,000 and got 36 million back, he said, maybe my hobby is better than my real business. So slowly, my hobby takes the percent of my time and like the people on the panel, I try to learn every day, try to make the best decision possible and stay curious. And it's, I honestly, I was when on a walk before coming here with my daughter who has joined me, said I enjoy every minute of the day, Frankly, 90 % of it. But nobody, I think, has a job better than my hobby. Awesome.

3:40Well, what's the secret to your success? What's at the core of that? I heard about earlier panels that you look at the person and try to judge their talent, their passion. But for me, I think the biggest element of success is hard work. I think hard work trumps everything else. And my father used to tell me, if you become cash flow positive, you have time to make mistakes and fix things. So I believe in cash flow, hard work. And of course, I really like smart people from Stanford, Berkeley, MIT. Now I have a lot of respect for higher education. And next time I come to the world, I will study, I promise.

4:32Our team has a weekly Zoom call. And for those of you on the team, you'll remember I held up the T-shirt, which I have three versions of that says, hard work pays off, which is a Matt Fraser saying who won the CrossFit Global Games five years in a row. And he just retired. So he just beat everybody by 30%, basically. But I believe in that fully. And I was telling my team, like, look, this is important. You can be smart. But if you don't work hard, none of that matters, right? What else do you identify quickly when you're across the table from a founder and you zero in on? So we did the investment today.

5:02It's called Multiverse in Spain. I think it's the best unicorn of Spain in AI. They compress AI by 90 % and the quality. It's done for Samsung phone and HP laptops. When I talked to, I think his name was Ramon, you feel the knowledge he has. And again, I'm not an engineer. So now I have a lot of good colleagues, partners who are PhDs from Stanford and PhDs from Illinois. I leave the technical due diligence to them. Someone else on the panel said, I think I'm a pretty good judge of character. and somebody asks the question, what questions do you ask? Always ask the entrepreneur, if this doesn't work, what are you going to do?

5:57What is your plan B? And quite frankly, if they have a plan B, I don't invest. Because it is hard. I have started, Plug and Play is my 18th company. And if you don't work hard, if you don't believe in what you're doing, like more than 100%, it's hard to succeed. And then I also say you have to get lucky. Timing and the people you surround yourself with is incredibly important. Right. An earlier speaker this morning said, what do I even teach my kids? What's the university going to be like? And my answer to that is we study a physics textbook at breakfast, and I have a summary of two books, Be Useful by Arnold.

6:40And one of the top five chapters of five ideas of the book is like burn your plan b don't have a plan b just go deep on your plan a and i have to read the book i like that it's an awesome book definitely guarantee to read it so what is a company like yours like plug and play you talk to so many ai startups and probably many are doing similar things many are doing things that nobody in this room is aware of yet of course because you're on the bleeding edge of that what does a company like yours do with ai given you're so deep in the space like how are you using ai day-to-day in a way that might surprise folks or just be interesting for them to hear.

7:11Between coming here earlier this morning, I went to BlackRock to meet David. He's their head of investment and head of AI investment in particular. I believe like keeping the human in the loop or relationship and the final decision. But quite frankly, research and knowledge is free right now. And I used to, when I wanted to start a bottle water business, I joined the Bottle Water Association, went to Black Mountain in San Carlos, and I delivered water for two days just to learn how it is like. And now I was able with Alberto Gutierrez to best build the largest water company in Spain and the most profitable.

8:03So my thought is you have to use AI, some other panelists said, to do 10x the productivity with the same people. But you have to have domain knowledge and focus and execution. And AI just can help you scale. I think it's bigger than industrial revolution. I think it's bigger than mobile revolution. And we all will benefit from it extremely. Like, I am hoping, I'm an optimist by life. I think we will make a better world. Maybe even this friction. Somebody else said, I have not listened to the news for two and a half years. I used to listen to NPR because it was okay on my way to work and back. but even that now bothers me.

8:56So I just said, I'm going to forget about the news till the news gets better. I say the pessimists are sometimes right, but the optimists make all the money, right? So let's talk about corporate venture capital. You have partnerships with over 500 corporations. Some of them might define it as corporate venture capital. Some just want IP and to make acquisitions in the space or just be on the bleeding edge like you. How do you work with them? What do they want? How does that work? Because a lot of people here in the room might have something and they have no idea how to relate to them or how to approach them.

9:24When I opened Plug and Play in 2006, Citibank and Volkswagen by accident came here. And they told me, Saeed, can you run a selection day? Citibank was implementing mobile banking and they gave us and 20 startups a sandbox to make mobile apps and features. And out of the 20, they incorporated four of them. And specifically, one of my favorite corporate partners is Mercedes in Stuttgart. Again, by accident, we had the board of directors, Ola, Dr. Seche, and the executive board. They were on a tour of Silicon Valley. They have a joint venture with Jensen, NVIDIA, to make an autonomous car. They visited me for four hours.

10:22created an event like this. We showed them four startups, but with their team, they have 400 people in Sunnyvale for Mercedes Lab. But before they left, they invested in all four startups. And they say, Saeed, you have to come and do this in Stuttgart. Fast forward to today, I have an office at the University of Stuttgart, and I do these solutions a year with Mercedes, Mercedes, Bosch, ZF, Porsche, Volkswagen. Like with Mercedes, I have done 54 pilots. 44 of them are in the car. And again, if you can text Ola, the CEO of Mercedes, and he texts you back the same day, you must have made an impact.

11:09Generally, with all of my 550 corporate partners, mostly we navigate the solution for them to solve a problem. My second favorite partner is Walmart. They spend $54 billion on supply chain and logistic and warehouse automation. So we have had an office at Walmart for seven years, and we do 10 projects a year with Walmart. Before AI was hot, I took a company called Platform Science to Walmart, and they installed it under 13 ,000 trucks. It's route optimization at the edge. And Chris Sotomayor from Walmart, head of supply chain, says, Saeed, that saved us$200 million a year. And then the Walton family asked me, Saeed, why don't you open a supply chain fund?

12:08I didn't want to invest other people's money. It's hard to answer to one set of people, call them pillars, which is entrepreneurs. I didn't want to answer to LPs either. Apparently that boat has sailed. So now I actually manage nine specific funds. Either they are AI for financial services, where my LPs, travelers, Aflac, and principal insurance, or it's an industry focus like supply chain and logistic. And again, since now I have 165 investment professionals and 12 partners, if I didn't raise a fund, I would lose my best people. So again, I gave up. I'm usually stubborn, but now I have funds.

12:57Right. So many, someone who can text message the founder, CEO, or chairman of some of the largest corporations in the world is a very busy person. And I'm sure you have a lot coming at you. So if there is a version of you in an industry where someone's trying to get a hold of that person, emails hit your inbox. I'm sure you have several people probably helping shield you from the world and filter things, of course. But like what pierces everything and gets into your brain and gets your attention? Again, I love meeting people and I love having a personal relationship with them. But you cannot have a personal relationship to have 2 ,600 active portfolio companies.

13:35But I choose the top D people that I enjoy and I think it's going to change the world. And I do better on techs. And my daughter, Sanam, she's in charge of marketing, technology, AI implementation. She took my cell phone number off of my card. She says, Saeed, you cannot have your cell phone. But I printed some without her. No, without her approval, I should say, because she's in charge of security too. So I have some of those cards with my cell phone. And if somebody I'd like to keep in touch with, I say, please, let's do it via text. And then we follow it up with the email or pitch deck. I like funny stories.

14:24I tell you a funny story. I went to Abu Dhabi and Dubai last week. I left Monday. I came back Friday. In the plane, I met two entrepreneurs. And I made an investment at the bar with the Meritz airline. But those two entrepreneurs, they had domain knowledge. They each had worked 10 to 15 years at PwC. They were solving a problem they were working on for 10 years with AI. They are cash flow positive and profitable with 30 people. But I just saw in their sparkle in their eyes, the joy they had. And apparently, they had pitched to someone at Plug and Play, not me, and my colleagues had passed on it.

15:13But I told them, let us take another look at it because I really liked them. Frankly, I shook hands with them for$100 ,000 if my bosses allow me. Because even though I sometimes make the decision or every investment decision, we have to have four of our venture people unanimously approved it. So I have to convince three of my colleagues before they can give them the$100 ,000. It's really hard to hear. I have to answer to everybody. So you have, I believe, about four dozen or three and a half dozen university partnerships. I would guess there's amazing startups and technology coming out of the universities and they need help commercializing that.

15:55It might be good for the university or the students, etc. Can you explain a little bit about how that works or what you've learned about working with the university? Every Wednesday, we have a university pitch competition. If anybody would like, we'll invite you. We feature 30 startups, normally to 300 investors and 100 corporate partners. And then these investors and corporate partner vote on the startup, that if they're going to have a follow-on meeting or not. We take that and we do a deep due diligence on five of the startups out of the 30. And then we invest in one or two of them. But last year, we registered over 100 startups straight from university, either professors or PhD students.

16:46My best one, it's called Garden Health. There were two PhD students. We gave them the first 250 ,000. Six years later, they went public at 6 billion. They just took over HP's headquarter on Page Mill Road. So I really enjoy being, it's actually an honor to be part of the journey of these entrepreneurs. But I always tell them, you have to do 99 % of the work. Plug and play will do that 1 % either help you raise money or help to do a POC with Mercedes or with Walmart. And believe me, that 1 % is important. But still, they have to do 99 % of the work. Got it. So after all these years, what do you care about most?

17:35Like what keeps you excited? They say at my age, and I do have a little money these days, it's mostly purpose and impact. So I am passionate about what I do. And my purpose in life is to make an impact in the life of the entrepreneur and solve some of the big problems in the world within healthcare, in mobility, in robotics. And honestly, that is the joy I have. Sometimes I still, my family says you shouldn't go to Dubai and Abu Debi and come back in two days. Have to little bit slow down. But I love what I do and I love if I can introduce a startup to a customer or to one of my VC friends? Sure.

18:29I think there's some people in the room that have done a lot of business with decamillionaires and other founders, but then they might be starting to approach like a centimillionaire or someone who runs a publicly traded company. Because of your background, I'm sure you get access to people and things that would be harder for other people to be. But if you were to mentor someone and say, if you want to do business with others at the highest level, heads of publicly traded companies, What have you learned that would be helpful and work for those that don't have your background and reputation? Now I am opening one office a month, like the one I opened recently is at Princeton with Microsoft and Corvive at the University of Princeton.

19:07And I kept calling Princeton president and he wouldn't see me. Then I went to Princeton, Governor Murphy was hosting me at his mansion for lunch. and the Princeton president showed up. He said, Saeed, I swear to God, I didn't avoid you. He had the squatters in front of his office because of the Palestine war. And he said, Saeed, I had graduation. That's why I didn't want to come or I didn't have time for you. But when the governor called, I had to show up. And honestly, he showed up at 12 and he left exactly at one. So if you can get somebody like a governor to call on your behalf, I think it works.

19:54So the idea, and then just to summarize, Governor Murphy, we are open three AI center of excellence, one at Princeton, one at Stevens Institute of Technology in Hoboken, and we are opening December at Rowan University. And I promised Governor Murphy, he will 3x the number of startups in New Jersey within three years. Funded and growth. And he wants, he said, why don't I have Antropic in New Jersey or Google? We're going to change that because they have the talent, they have the research. They just don't have the connection as much to money and to Silicon Valley. Right. Makes sense. Awesome. Great answer.

20:42If you were to go back 30 years, what advice would you give yourself? I'm actually doing Plug and Play 3.0. This is chapter three of Plug and Play. If I was like 1982, I exported five Apple computers to Italy. And Apple told me, Saeed, do you want to become... We had to pack it. They gave me a keyboard, a box, and a monitor. they were so out of touch with export licensing and everything. If I had to go back to 84, 83, I would embrace technology more. And I would, even though I have done well in bottled water business and packaging, I think I would have loved to embrace technology sooner. My wife is my tech support at home.

21:35So I'm really bad with technology. But at least now I invest in technology to make up for it. Thank you. Great. And any last comments for something you wanted to share today? No, no, no. Again, I really enjoyed sitting through some of the panel. We are working with NARF funds. We have a lot of LPs, which are Walmart and Walton family. But it all comes through the relationship we have with the corporations. but we are diversifying our LP-based family offices. So if anybody is interested to learn more about Plug & Play, we'd love to show you what we're going to do the next 10 years. We call it Chapter 3 or Plug & Play 3.0.

22:25It's great being part of the journey, especially today. And thank you, Richard. Thank you.

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