GCV Powerlist 2017: #3 Wendell Brooks

Often the best assessment of a person’s importance comes from the company’s CEO and team. Such is the case with Wendell Brooks, president of Intel Capital and senior vice-president of the US-listed chip maker.

Brian Krzanich, Intel’s CEO, said: “Wendell has a unique combination of deal-making expertise, leadership and strategic vision that makes him integral to Intel’s transformation.

“In leading both our strategic transactions and our equity investments, Wendell’s focus is to drive growth for Intel. In just a short time, he has refocused and re-energised Intel Capital while acquiring new assets that advance our strategy – from FPGAs [field-programmable gate arrays, customisable chips] to autonomous driving solutions and more. I am very pleased with Wendell’s leadership of Intel Capital and look forward to his important and ongoing contributions as Intel transforms from a personal computer company to a data company.”

This view is reflected within Intel Capital, too. Tamiko Hutchinson, Intel Capital’s chief of staff and a GCV Rising Star 2017, and Lee Sessions, managing director leading its global summit and technology days responsible for 4,744 customer introductions to portfolio companies last year, said: “We have been with Intel Capital through several great leaders – and we can truly say that it is a most exciting time to be here now.”

Brooks leads a range of strategic activity, including the corporate venturing program, Intel Capital, and Intel’s mergers and acquisitions, strategic licensing and business development activities.

He oversaw Intel’s largest acquisition, Altera, a $16.7bn deal to support Intel’s push into data centres. It was the second-largest division for revenues based on results from the first three months of last year, and growing. Intel has been pushing strategic change, as its biggest division, client computing, offsets falling unit sales through price rises in the wake of the shift from personal computers to mobile.

Brooks joined Intel three years ago after helping sell Intel Media to Verizon as an investment banker at Allen & Co leading its Europe office, having formerly been a technology, media and telecoms (TMT) banker at Citi for nearly 15 years.

More recently, Brooks in March led the $15bn Mobileye acquisition to help it move into autonomous vehicles and assisted driving. He was promoted last year to senior vice-president at Intel, reporting to Krzanich after the retirement of Arvind Sodhani, and said he wanted to impact Intel and society.

In pursuit of social impact, last year Intel Capital expanded its Diversity Fund, broadening its mandate to seek entrepreneurs who are members of the lesbian, gay, bisexual, transgender and queer communities, disabled people and military veterans in the US.

Brooks said: “Instead of having a separate, small team focused on diversity investing, we have made investing in diversity an expectation for all our investment managers. In addition to sourcing startups led by diverse teams, they encourage current portfolio companies to seek out diverse candidates for their senior management teams to increase their diverse representation. Through these efforts, we have seen the number of diverse companies in our portfolio grow to 28, representing a collective $111m investment.”

This, however, remains a fraction of Intel Capital’s dealflow. Last year it put $455m into 87 investments, including 34 new deals, with more than 40% of the dollars invested outside North America.

Intel Capital is seeing its average deal size grow as it reduces the number of new deals from about 50 a year to about 30. Brooks said: “Taking more meaningful ownership positions enhances our ability to drive value for our portfolio startups, not just in terms of dollars but in terms of our value-added services – and especially in terms of Intel’s technical and business expertise. We led nearly every one of the new deals we did last year.”

This year is also off to a strong start, he added, with more than $400m invested in new and follow-on deals in the first quarter (Q1). These Q1 deals included co-leading a $10m series A round for US-based online specialty food marketplace Goldbely.

And Brooks said “the exit cadence also continues to be brisk”, with seven portfolio exits in Q1 including the first flotation, Fibocom in China , and agreed exit of US-based iris recognition technology producer Delta ID in a $106m acquisition by identity verification technology provider Fingerprint Cards.

Since then, Intel, Unilever and Bauer Media will exit online recipe recommendation platform Yummly, which was valued at $100m as of 2015, in an acquisition by appliance maker Whirlpool, and US-based big data software provider Cloudera has gone public in a $225m initial public offering.

Intel Capital had 25 portfolio company exits last year, including two initial public offerings, which the company said was about “on par with our historic average over the past decade-plus”, although the company is planning to reduce its overall portfolio size to focus on its strategic priorities and the companies it can help most.

Brooks said: “In 2017, we will continue to invest in companies where Intel technology can deliver a significant market advantage. I am excited about investing in pathfinding new technologies for Intel and our industry.

“This year we are looking especially to drive value around artificial intelligence, autonomous driving, merged reality (augmented and virtual) and 5G, as well as the data centre and immersive sports and entertainment.”

These are all important strategic areas for Intel. Brooks said: “At the Global Corporate Venturing & Innovation Summit in Sonoma in 2016, I said corporate investing requires more than financial returns. As a corporate VC, our charter is to drive shareholder value, make pathfinding investments for the future of the corporation, impact business unit strategy going forward, and contribute to social responsibility. Over the past year, I have transformed Intel Capital in order to help transform Intel.

“As Intel Corporation continues its transformation into a data company, we are building a strong ecosystem with technologies such as automated driving, artificial intelligence and 5G. Intel Capital is engaging in C-level and board-level strategy discussions. We are investing significant capital around the world, in venture capital equity investments and other strategic transactions.

“Nearly every business is being revolutionised by data and the ability to capture, connect, analyse and interact with it. Intel Capital has helped to find new technologies and opportunities for Intel. Our investments have formed the core of new Intel business units. I currently oversee Intel’s sports business, which is reinventing the way people consume sports with immersive experiences.

“This new business unit was formed with Intel technology and a number of equity investments and acquisitions that began as venture investments, including Voke and Replay. Our investments in areas such as athletic performance further support the growth of immersive sports.

“All of these drive large amounts of data and make use of Intel’s compute power and end-to-end connectivity.

“A second new business group emerged after our acquisition of Nervana. We initially considered an equity investment in this pathfinding company, then realised an acquisition would better suit Intel’s growth strategy. We acquired the company last year, and recently announced it is the core of the corporation’s new artificial intelligence business group, reporting to our CEO.

“These two examples reflect the change I have been driving. Intel Capital has an incredible track record of making investments in innovative technology sourced from around the world. Last year I made several changes to help accelerate our velocity. I wanted to leverage the capability of our strong team in our decision-making. I reorganised and empowered my staff, increasing their scope and decision-making authority to span equity investing, M&A and corporate development deals.

“Their roles require a deep understanding of our corporate strategy and the ability to see the future – sometimes before the business units themselves see it. Leveraging talent across the organisation has enabled us to move faster and engage with startups in the best way for a given situation.

“A single deal team can explore any kind of strategic engagement with a company, with structures that range from licensing to equity to M&A, and transition between any of these alternatives seamlessly for customised, optimal results. With greater agility and fewer handoffs, the team is able to move faster and do the right deals at every stage.

“I am proud of the team’s capability. My direct reports have a scope and decision authority equivalent to corporate venture capital leaders in many corporations. I have set challenging goals, judiciously expanded the scope of everyone on my direct staff, and created a more focused collaborative team to find and execute the best deals and drive development of our portfolio. I am pleased this was recognised by Intel Corporation’s leadership – four managing directors were recently promoted to vice-president. We are honoured that GCV has selected several of our leaders as Rising Stars in recent years.

“One of my key objectives, from the time I joined Intel, has been to capture the full value of the investment thesis for each transaction. I started this by increasing our focus on post-acquisition integration. Last year, I put substantial focus on portfolio management with the same objective in mind. The first thing we ask ourselves when we engage with a potential investment is: ‘How can Intel help this startup grow?’

“We spent quite a bit of time early last year looking at our full portfolio and making sure we are positioned to help them succeed. Together with a fuller suite of tools to help our portfolio companies, we have sharpened our ability to serve a technology startup or private company at any stage of the entrepreneurial lifecycle, up to and including helping them exit.

“We established a portfolio management team to help our portfolio companies connect and work with the right technologists and business unit leaders within Intel in a more systematic way. We are designing engagements with dedicated teams and with Intel business unit leaders to advise and advocate for our startups, and really leveraging the resources of Intel.”

Intel said its introductions through its technology days and global summit between its Global 2000 customers and business units with portfolio companies had led to more than $91m in new or expected business in the past four years.

The company said its global summit generated a huge amount of press coverage for its portfolio companies, providing a level of visibility equivalent to more than $90m in advertising spend.

Given such leadership by Brooks and Intel, it is just a fraction of the true value of the relationship to all sides.