Last month, Jeff Herbst departed from US-headquartered semiconductor technology provider Nvidia, where he had led its business development activities and corporate venture capital (CVC) unit Nvidia GPU Ventures for two decades starting in 2001.
“I spent the last 20 years running business development for Nvidia,” Herbst said. “I also founded and ran its venture investment activities as well as its global artificial intelligence (AI) startup accelerator.”
Herbst has teamed up with seasoned venture capitalist Jay Eum to set up a US-based frontier technology-focused venture capital firm dubbed GFT Ventures.
Eum had co-founded another VC firm Translink Capital in 2007, where he oversaw four successful funds and over $600m in assets under management. Before that, he had been founding managing director for Samsung Ventures America, a CVC unit of the South Korea-headquartered consumer electronics manufacturer, for nearly four years.
Herbst added: “Jay and I have been friends for two decades, and have collaborated and co-invested in the past. This is indeed our passion, and we are looking forward to building the GFT franchise together for many years to come.”
The new firm is concentrating on the US and Israeli ecosystems, identifying and investing in developers of disruptive technologies including AI, data, robotics, cybersecurity, blockchain, digital healthcare and mobility.
The rise of modern AI techniques could represent the biggest technology inflection ever, according to Herbst, who said: “I just read a report from an investment analyst calling it ‘the mother of all cycles’.
“We formed GFT Ventures to capitalise on AI and other major trends in what we call ‘frontier technology’. This includes data science, robotics and automation, blockchain and fintech as well as digital health.
“Our sweet spot is early-stage companies solving the hardest problems for the largest markets. And we ‘lean in’ heavily when we find the best and proven management teams in the business.”
The firm has just begun investing, and some deals have not yet closed or been announced. “What I can tell you is that our first lead investment is in a company leveraging AI and data science to revolutionise the way marketing dollars are deployed and tracked by CMOs (chief marketing officers) and CROs (chief risk officers) across large enterprises. This is a white space in a huge market, with a top calibre management team.
“We have also already invested in a couple of other companies leveraging the blockchain and NFT (non-fungible token) technologies. In all cases, the management teams are known, proven and top-notch. Although we are technically a ‘new’ fund, Jay and I both gain a lot of leverage from the fact that we have proven track records, defensible expertise and operational experience, and are well-known to entrepreneurs and other VCs. So we definitely benefit from what we like to think of as proprietary deal flow.”
Both Herbst and Eum come from corporate backgrounds and are collaborative by nature, Herbst pointed out, adding that he is passionate about working closely with GCV in various initiatives including chairing the GCV AI Council to work more closely with other ecosystem players.
“We would like to think of ourselves not only as VCs but also ‘ecosystem builders’. We are already collaborating on deals with top VCs from other firms as well as dozens of corporate venture investors around the world,” Herbst said.
“In fact, our relationships, and desire to collaborate with, corporates is one of our major differentiators from other early-stage funds.”
In addition to his VC role, Eum is the chairman of the Asia America Multitechnology Association and a board director of the Association of Asian American Investment Managers.
“We are both very passionate about giving back to the community, including mentoring young founders as well as those currently under-represented in our industry,” Herbst added.
As for the year ahead, Herbst said GFT Ventures has “big plans”. He explained: “Although we have just formed the fund and are really just getting started, we are already about halfway to our target fund size of $100m.
“We will finish raising our inaugural fund, and we are delighted to engage with any potential new LPs (limited partners), financial or corporate, that would like to join us on our mission.
“At the same time, we are already very active in evaluating and closing on startup investments. In another year, I am sure we will have at least a half dozen more companies we can talk to you about.”
Herbst considers the opportunities present today are tremendous. “We are at the beginning of the most disruptive technology cycle most of us will see in our lifetimes. Essentially we have entered an era where ‘software can write software’, which ultimately enables exponential technology development.
“The challenge, which in fact is also the opportunity, is to separate the ‘signal from the noise’ and zone in on the highest growth areas and the startups with the most potential. The tendency in a bull market is for everything to look attractive, but we know from experience that is not the case. We will leverage our pattern recognition skills, gained over our long track records investing in frontier technology, to make sure we stay extremely focused and disciplined. This will be fun!”
