J.P. Keating, founder and managing partner of ProChain Ventures, joins Vlad Cazacu, co-founder and CEO of Flowlie, to discuss his transition from corporate venture capital to fund manager.
From J.P.'s reflections on inefficiencies in the supply chain to his passion for groundbreaking technologies, discover the secrets that drive the next generation of supply chain innovations. Don't miss out on Keating's insights into the importance of diversity in the industry, his valuable lessons from several CVC firms, and a special segment where he pays tribute to a mentor who shaped his journey. Tune in for an episode filled with wisdom, revelations, and a sprinkle of humor!
You can find J.P. Keating on LinkedIn at https://www.linkedin.com/in/jp-keating/ and learn more about ProChain Ventures at https://www.prochain.vc/.
Learn more about Flowlie and how the platform can help you screen deals faster and discover the right connections from your network at https://www.flowlie.com.
Stay up-to-date with all our episodes by checking our website at https://www.thevcarchitects.com, following us on Twitter at https://twitter.com/thevcarchitects, and on Instagram at https://www.instagram.com/thevcarchitects.
The VC Architects (Ep. 3) - J.P. Keating (ProChain Ventures)
===
JP Keating: [00:00:00] I am JP Keating, managing partner and founder of Pro Chain Ventures. Supply chains are broken and we're investing in the next generation of supply chain technologies to transform them.
Vlad Cazacu: Hey everyone. Thanks for tuning in and welcome to the VC Architects, the podcast where we share the real stories behind new VC fund managers and the blueprints used to make them successful. My name is Vlad Cazacu, and I'll be your host today as we interview JP Keating, an investor with several decades of experience in supply chain and procurement roles across major enterprises bringing in a unique point of view on how technology can be used to upgrade our antiquated infrastructure.
Vlad Cazacu: If you geek about picks and shovels, this is the episode for you. For more information about sharing and growing your venture fund, including show notes, highlight clips, and exclusive scenes, follow us on Twitter and Instagram at @thevcarchitetcs, as well as on our website at thevvcarchitects.com.
Vlad Cazacu: This episode is brought to you by Flowlie, the number one choice for deal screening and network management used by thousands of [00:01:00] investors from 50 plus different countries. Now, let's dive right in.
Vlad Cazacu: Welcome, JP. Thank you so much for joining us on the podcast. Really much appreciate you taking the time to have this conversation with us
JP Keating: today.
JP Keating: Thanks, Vlad I was excited to be part of this and excited to see where the podcast is gonna go.
JP Keating: So th thanks again for having me on.
Vlad Cazacu: Indeed. I think we're buckling up for an amazing conversation. It's such an interesting background that you have and now coming into VC as an investor, and I would love to unpack a little bit on that early genesis of your interest in venture capital.
Vlad Cazacu: Yeah. And quite frankly, I would like to start with a little bit of your background. Like having spent right. 20 years in various supply chain and procurement roles across multiple enterprise, right. Boeing AB InBev, ConAgra, like what was the motivation to go into VC investing in the
JP Keating: first place? Yeah.
JP Keating: Yeah. Well, after, after 20, 20 plus years at this point I got to see a lot of things and I got to [00:02:00] experience a lot of things within all of these different industries. I like to say I worked for five different Fortune 500s, but there was like 12 verticals in all of that, and just having the exposure.
JP Keating: To that that amount of commerce and cultures and communities and everything else. I picked up a lot of things and I was always the super curious guy. I was never good in one particular function, and it would frustrate people to no end because I would get bored and like, I've got to learn something new and understand how.
JP Keating: The enterprise works. How are we making money? How are we spending money? How do we operate? How do we create value? How do we keep our license to operate in society? And that fascinated me and I. Because of that, I just decided I wanted to keep learning and I kept moving and moving and moving, and then I discovered I couldn't find a job that I really liked, that I wanted to [00:03:00] stay in for a long period of time.
JP Keating: And I said, what can I do that allows me to work on sort of a global scale? On an enterprise scale and provide value throughout the whole thing? And I knocked it down to like three or four jobs and one I had been doing for a while, I didn't wanna do anymore. The other one was internal audit and I didn't wanna go back to that again.
JP Keating: The other was c e o and I didn't think I was smart enough to do that. And then I realized I like the innovation side. Now how do I do this? On a much larger scale than just a one-to-one within a company. And it just kept leading back to investor. And I had gotten involved with a lot of different organizations early on and 10, 12 years ago at this point when a lot of accelerators were taken off and all that.
JP Keating: And so I just fell in love with it. But really what drove the whole thing and why I just kept going. I was constantly trying to innovate in the companies I was working for, and it just became this like, I was [00:04:00] personally and just professionally offended by the inefficiencies and the waste and the poor working conditions and the general terrible user experiences in most of these enterprises.
JP Keating: They weren't bad companies, but the after a while the work Was just drudgery and the systems were terrible, and I'm just visualizing money disappearing everywhere. Just companies hemorrhaging money and I got to see that firsthand. And so we didn't have a lot of transparency. Just the lack of data and understanding in supply chain was just staggering to me.
JP Keating: A lot of the resources were just poorly deployed. It was endlessly frustrating to me. So I was always trying to fix this because it was like, Let's make more money so we can do more good. Right. And pay people better and make them more innovative so that they continue on the virtuous cycle here of creating as much good in society as we can through commerce.
JP Keating: And I [00:05:00] loved it. And so after the last few years of watching everything sort of implode around supply chain, it was just, I was called to it. It's like this is the time. You know, this is our opportunity to have an impact with communities, with customers, with stakeholders, just overall society overall.
JP Keating: And that's how we landed on this. We saw, these supply chains are broken, the tech is broken, the talent is frustrated. The systems need to be updated. And we said we wanted to transform these for good. Not just to fix the physical, mechanical, financial problem, but also fix these societal problems while we're at it.
JP Keating: And we said this is the time. This is the time. We're at the right age. We've got the right experience, we've got the right team. Now let's go make this happen. And that's, That was my motivation behind it. I wanted to do some good, it was that go going to, Jesuit schools growing up.
JP Keating: They put that into your you know, into your psyche, right? We're men and women for others, and there's a higher purpose and a greater good [00:06:00] and serving humanity and we can do that through business And venture is a fantastic tool to do that. If done right, and done with heart really is like how I'd like to talk about what we do.
Vlad Cazacu: Yeah. And then it's hard to do it right, to do it with all the right intentions and with everything that, involves money, sometimes, bad apples come into it. So I command you for Oh yeah. Taking the, the value driven road in this space. So I'm curious, all this background somehow reminds me of a founder journey, right?
Vlad Cazacu: Frustrated with big enterprise, moving from one place to another, never really finding a true home. In what they're doing. So I'm just curious to understand a little bit before you started ProChain ventures, you spent some time leading Allstate technology and Strategic Ventures arm. How was that transitory role for you and why did you choose to make that career move before starting the fund?
JP Keating: Yeah, so I love corporate venture. A lot of people not corporate [00:07:00] venture. I loved it. And I had been trying to work in corporate venture for a long time. I was around at the very beginning of what is now or gone through iterations of Boeing Ventures and I thought it was amazing.
JP Keating: It wasn't developed at that time. It didn't quite work the way I wanted before I left, so I wasn't able to really exploit it, but I never got rid of it. It was always in my mind because we were creating so many amazing things and It, it wasn't really corporate venture. It was a lot of R&D kind of thing it, I wasn't in the right space at the right time.
JP Keating: I wasn't engineer, didn't make sense. It really wasn't a business imperative back then where it is now and has changed when I moved into other spaces and where I really liked it, where I really started leaning into corporate venture and corporate innovation is when I was with the power utility, and it was right as a lot of renewables and things were starting to happen, and I just got hooked on all of this.
JP Keating: Like, how do we make this better? How do we [00:08:00] keep it going? And again, utilities were not very innovative at the time that I was there. So I was looking at early stage companies to be able to come in and help us with operations, help us drive some revenue, do some other things. But I was really leading up that corporate startup collaboration. At the very early stages, I was running supplier diversity programs, which and small business liaison programs, which the entire mission is to try and work with small businesses and minority and women and veteran and L G B T owned and disabled owned companies.
JP Keating: And I realized I was doing venture work. I was out trying to find companies that could come in and provide a lot of value to us and help us serve our shareholders, our stakeholders better and. I had moved on into ConAgra and there was a lot of data at the time around and there was a lot of effort around that time around food innovation and Ag Tech was just starting to take off, and so I.
JP Keating: I attempted to start a tiny [00:09:00] corporate venture outfit there so that we could invest into early brands, ingredients materials, things like that. Because one of my arguments too is I was able to solve two things here. One, we wanted to innovate. We wanted to find new things. I had a vision to be able to support these companies through all of our buying power, all of our ability to co-man things and et cetera, et cetera.
JP Keating: It's grand vision. On the other side too, is we were looking for new brands as while I was running the diversity of the supplier diversity program, I realized, and I found some data that like 80% of. New food brands, food and beverage band brands were started by minorities and women. I said, why aren't we leaning into this?
JP Keating: And started pushing for that really hard and then started discovering some really interesting data companies out there that were providing insight and transparency that were leading the charge for smart label and all of that ingredients. But that's what solidified it for me. Again, it wasn't the right timing.
JP Keating: We, you know, [00:10:00] leadership changes all of that. It wasn't working, but I was still doing it. And then I. I was looking for another company that had an established strong corporate ventures group and had a strong corporate development group, and I was pulled in to work back in the supply chain group leading the small business liaison program and the supplier diversity program.
JP Keating: When I took the role, I told him what I wanted to do. This is I'm creating an external innovation program through. The supply chain group, and we are going to become the most innovative group in the enterprise because of all the assets that we have available. And we're partnering up with corporate ventures and we're partnering up with corporate development, and we're going at this effort as an enterprise.
JP Keating: Okay, great. So I made friends with all those folks and I was working really tightly with our corporate ventures group and loved it. And then, corporate things happen here and there and best laid plans start to fall apart. And I said, [00:11:00] yeah it's time to, it's time to create something on my own with some strong partners that I love to work with and that are aligned with the same mission.
JP Keating: And so we, you know, we kind of bootstrapped launched it and away we went, but. I really like corporate venture and I partner with them a lot. I co-invest a lot with corporate venture outfits, and the reason why I love them is that the customers for almost all these portfolio companies are big enterprises.
JP Keating: And we have those relationships and we're able to help them build the relationships. And that's I never particularly wanted to leave corporate, but again, it was, I can't solve these problems I want to personally solve in one organization. And so said, Hey, this is what we gotta do to go forward.
JP Keating: It ain't an easy road, but it's my mission. All
Vlad Cazacu: roads, all roads were pointing in the same direction, right? All roads were, we're taking it towards starting.
JP Keating: You know, approaching ventures, the mission. Yeah, the mission never changed. It just kept leaning, gaining. I [00:12:00] kept getting closer and closer into relationships, kept building, and there was so much momentum that I couldn't not do this, you know, and it's, it's a good place to be in.
JP Keating: So yeah, it's absolutely, it's an exciting ride, no doubt.
Vlad Cazacu: So let's lean a little bit more into protein chain ventures and specifically the thesis of the fund. I would like to unpack a little bit more so, you know, in, in a few sentence, can you tell us what are you focusing on at ProChain ventures and how did you arrive
JP Keating: at this insight?
JP Keating: Yeah. Yeah. So we focus entirely on supply chain technology, and I can read you my specific thesis. We talked about VC lab and all that before, and they put you through the thesis thing. I had to adjust a little bit. But we like to say Pro chain ventures, US-based VC firm, founded by investors and operators from leading Fortune 500s and corporate venture capitalists, and we invest in pre-series A startups that are creating transformative supply chain technologies, and we leverage the partners decades of venture and supply chain [00:13:00] operations experience. Three 10 x exits in the last two years.
JP Keating: A diverse global network of domain experts, senior executives, founders, advisors, co-investors, and resource partners to source support and develop our portfolio companies. So overall we like to say we're a specialty firm focused on transforming supply chains for good. So that's the overall big piece of it, but, Really we like supply chain tech, both software and hardware at the pre-seed and seed stage. Most of the things that we're investing in Are going to have a valuation under $15 million. We kinda target somewhere in the a hundred to 250,000 range for our first investments. We've done lower, we've done larger. We've also done some Series A, but they were very novel technologies that we wanted to be a part of.
JP Keating: So even though we're not getting substantial ownership in it. I just tell everybody, look [00:14:00] a coach seat on a rocket ship is just fine with us. You know, we're, we're gonna get there with the rest of them and we're gonna do, well. We don't have to own it. Some of them we have a higher percentage in.
JP Keating: We do wanna lead where we can. We're not at that point yet. The easiest way for most people to understand it, 'cause supply chain can get very nebulous, very complicated. So the easiest thing for people to really understand, we discovered is we look at.
JP Keating: Every tech that starts at demand planning and ends at last mile delivery. And so everything in between, and you've got multiple things in between from prediction, predictive replenishment that we're looking at, inventory management, procurement supplier management, sustainability. But then we've also got transportation platforms, we've got marketplaces, we've got two aircraft companies, we've got an autonomous rail car company. And then our last mile delivery firm, which I did not like last mile. I never wanted to do last [00:15:00] mile, but this one was so interesting that we decided to jump on it at a pre-seed and so far and at pre-seed at in January. And that has been Our most successful investment in since we really started deploying capital about 10 months ago. And the other thing too, we have a very strong focus on working with diverse founders and founding teams and also companies that have a sustainability charge.
JP Keating: We're not really looking at sustainability companies, but we're looking for companies that will have major impacts to decarbonization, to sustainability and that are doing a lot of good just through, emissions reduction, waste reduction. We're really not looking at anything around carbon scrubbers or carbon sequestration or anything like that.
JP Keating: That's too far out. That's not, that does not really fall into the supply chain aspect of it. But the big driver behind that too is when you, there's multiple data points out there to tell you, but roughly the [00:16:00] state, I think it was Accenture that just said it, like 60% of global emissions are driven by supply chain operations.
JP Keating: So all we have to do is fix what we're already doing to some extent. I'll just call it the correction, the carbon correction stack. We'll let other folks do the scrubbers and things, but we can solve for a lot of it down here with efficiency and new fuels, new transportation methods, better predictive technology, better demand planning technology. So you're reducing all of that waste and all of the resources that go into the production. So that's a unique theme that we have going on there.
Vlad Cazacu: This is very interesting and quite frankly, again, coming back to the beginning of our conversation around value driven VC and d oing venture for good and moving the world forward. It's very clearly reflected in your types of companies you back. So I'm very interested, to flip the coin and speak a little bit about the LPs who back you mm-hmm. Where that thesis alignment is on the found the funders yeah. Behind [00:17:00] you. So can we get a little bit of a better understanding, like what is your LP composition?
Vlad Cazacu: Who are the people who are attracted by this
JP Keating: thesis in the first place? Yep. Yep. So we have only targeted high net worth individuals and some family offices. And I will say I'm not great at family offices. I didn't know a lot about family offices, I was not from a wealthy family, so this was a new endeavor for me.
JP Keating: All of our investors so far Have been high net worth individuals who understand supply chain, understand mobility, understand aerospace, they all came from those backgrounds in some way. One of my best investors, one of my very first investors that believed in what we were doing, his wife was a was a supply chain professional and like they understood it and they saw it and we're like, we're in. I'm like, awesome. So that's mostly what it's been and it's a different road. You know, we're not a [00:18:00] generalist investor. We never wanted to be one, so we're not really leading with the typical financial return, if you will.
JP Keating: Our returns are still, we're projecting very good double, triple digits on some of these things, but it's a, it's more of a holistic approach where we are having an impact on society. The things that we are doing are deflationary. And that every time a customer will use one of these, it's going to reduce their cost and increase the transparency and provide all of the value to their customers that they need.
JP Keating: It's not a, it's not really a nice to have. These are all must haves going forward, and they provide real returns to their margins. So it's not a lot of. Guesswork. These are like hard, hard savings. And so enterprise will pay for hard savings. So in turn, returns work. We look for [00:19:00] companies that will most likely get acquired.
JP Keating: So we're not looking for, we're really not looking for IPOs in this space. It usually doesn't make any sense. So the investors that are good with the profile, with the return profiles that we're talking about and the timelines that we're working with and the portfolio construction, they like it. So one, one key element of our portfolio construction is that we want companies that provide synergies across all of the other companies.
JP Keating: So now our portfolio over is more valuable to gather than it is just one. Just one thing, like I never liked the typical VC model of we invest in ten five die. I don't wanna do that. And, being in the Midwest, the investors that I've got, almost all the in invest investors I have are from here.
JP Keating: They don't really dig that either. They're willing to take a risk, but it's wait a minute, how much are we gonna lose at this? I [00:20:00] kinda look at 'em like, I would be perfectly happy with eight triples, and maybe one dies. And we're, that still puts us at a top decile fund for performance.
JP Keating: We have some companies that are on a unicorn path. We have a half a dozen of them. It'd be great if they hit that, but. We wanna help them build solid companies that are creating cash flow and will get acquired in our lifetimes. We'll see that tech come to fruition in our lifetimes as well, versus some of the other stuff out there.
JP Keating: So our profile's a little bit different than some of the other some of the other firms out there, but our investors like it. And so we're just gonna keep pushing that direction. So I
Vlad Cazacu: actually wanna spend a second on this, right? Because I'm trying to understand exactly where this came from.
Vlad Cazacu: Was this necessarily a thesis that you came to the LPs with and realized that to some extent you're flipping the venture model on its side and saying that, some diversification and getting higher graduation rates of my portfolio to later stages, and that on [00:21:00] acquisition for, smaller multiples works. Was that something that you came to the LPs with or was that something that you co-developed with the LPs because of the interest that they had in this direction?
JP Keating: Yeah I really led with it and I had tested it for a while and so it. The LPs that said yes liked it. A lot of the other ones that said, no, were looking for more of a generalist approach. It is what it is, but I'm protecting the downside as much as I can here too, because you all have entrusted your wealth with me, and that means a lot and I never wanted to be that kind of investor that was like, oh yeah, this looks cool and go for it. I didn't like it and I wasn't a big fan of consumer either because I had been in consumer businesses and I knew how fickle the consumers were and I said I would rather be the picks and shovels company.
JP Keating: You know, we're the, it doesn't matter what flavor of beer you're coming [00:22:00] out with or what you know, energy bar you're coming out with. It all still needs to be made by these companies in a supply chain that we're supporting. And that always gets paid. Brands come and go and it costs a pile of money, just an insane amount of money to be able to get to scale with consumer brands.
JP Keating: And I just didn't like the profile of it, you know? I mean, I, I didn't like investing in it, so as I just, I don't wanna do that. Let's invest in the boring billions out there that most people don't get. They, it's not sexy at all, but it enables all of society. I said, we've witnessed it happen during covid.
JP Keating: Guess what happened? When the people go down, the whole system breaks. So there weren't great tools. There still aren't great tools. There's still endless problems that exist in this space. So the sheer size of this opportunity was just too hard to ignore. We got comfortable with a number of $12 trillion and said [00:23:00] the great part about what we're doing is that there's opportunity for endless innovation.
JP Keating: We've got labor shortages that are never going to get better. We have to augment them with this technology to give the people, the current workers, the tools that they need to succeed without getting. Without getting overwhelmed and quitting and just perpetuating this problem. So it's not a nice to have anymore. It never really was a nice to have. You must have it to stay competitive and then you throw in, reshoring and everything else. You're reshoring all over the darn place. So you've gotta figure out new technology, new transportation methods to get the things where you need them to go.
JP Keating: And with climate change, we gotta start figuring out, Where we're gonna start growing other things too. And you have to create supply chains to get the food to the people that are there that don't exist right now. So it just kept screaming at us like this is where it's at.
JP Keating: And having the unfair advantage [00:24:00] of understanding how these things work is what positioned us for success with our LPs. They knew that I had five fortune 500s under my belt. My partner's got another, well, my partners have got another eight, nine, I think at this point. Plus the greater, just the greater networks that we have, we were really aligned for success in this space. And being able to help support and develop those portfolio companies was actually a real thing that, that we could do. The LPs liked that, like you've got the depth here versus other firms that were talking about investing in supply chain and that really resulted in more last mile delivery and, 15 minute grocery delivery. We're like, that's not where the money is. That's part of the system, but it is not the whole system. You're missing this, you know that that's last mile delivery, that's the rest of it. So yeah, we, we couldn't, we [00:25:00] couldn't pass it up.
Vlad Cazacu: You've identified you're really sitting at the cross hairs of several Trends they're all working in your favor, in the favor of your portfolio company.
Vlad Cazacu: I'm curious to understand a little bit who are the people
JP Keating: who said no, right? Oh yeah. What, and, and why, right?
Vlad Cazacu: Like, was it more you reaching out to the wrong people? Were they not understanding the thesis and the, the history trends that were working towards your advantage? Or was there something
JP Keating: else?
JP Keating: Yeah it was a little bit of everything. Everything from I. Nah, we only wanna do SaaS. Okay, well you know, we make the argument like you can't be a supply chain investor unless you're working with both the digital and the physical world. It doesn't work. You're missing it. One can't solve it.
JP Keating: You have this, this, you have to solve the problems together. So folks didn't wanna have any hardware exposure 'cause it took too long. Other folks just Just didn't have the money. They were all scared, everybody was scared. And one of my big goals here was to be as inclusive as I [00:26:00] could for our firm.
JP Keating: I wanted to bring in a lot of supply chain professionals out there that were accredited investors for low tickets to give them access to this asset class. And they could. They could also be very value added LPs. There was opportunities for them to get engaged and what I discovered was that most of them didn't understand venture and it was taking way too long to educate and it was unfortunate. They're still all my friends, but they just, they were not comfortable with the potential of losing their money. Even with a portfolio theory or a portfolio size that we're looking at, which we wanted a very large portfolio. They couldn't, they just couldn't pull the trigger on it.
JP Keating: And so that was a big part of our initial fundraising thesis is like, Hey, we can pull a bunch of $25,000 checks from people and I wanna share the love with my professional associates and friends and [00:27:00] colleagues. I. Here's a way for us to do something special, and it was a real challenge to pull that off.
JP Keating: So I ended up stopping and started focusing on some other folks. But, even then, it was a lot of folks didn't want to invest in funds. They wanted to do things directly. I said we look at like thousands of deals a year. I said, you can't possibly touch that. I said, so, If I'm bringing you deals, you should at least be part of what we're doing. It's very much a numbers game. You're trying to find the people that you think are gonna fall into this and finding people are difficult, even with a huge network.
JP Keating: And eventually you get someone that says yes, and then they're excited and they tell their friends, and you get a couple of them to say yes. And it's funny, but most of my investors were loose connections who were just great people that I had known. I spend most of my time trying not to burn bridges over careers. I just wanna be friends with everybody. I like it [00:28:00] and, but I just lose track of people, life gets in the way and some folks, I hadn't spoken to in 20 years, but, we were tight at one point. They knew us. They, knew my network. They knew the people and they liked the space, and all of a sudden it was, yeah, I'm in.
JP Keating: And then the next deal was like, yeah, I'm in that one too. And o okay. And so we're, we were building it up slowly. And so now it's it's just continuing looking for those. So today was a, today and yesterday we were great fa, great situation like that. Got some loose connections. They love what they were doing.
JP Keating: I think they're gonna, I think, to pray they're gonna, they're gonna invest with us so we can make some of these deals happen. But it I haven't had a consistent No. Some of 'em are like, no, that's not enough. Or No, that's way too much. We can't possibly do that. The too small I think is funny sometimes.
JP Keating: I mean, I had somebody tell me, you need to have a hundred million dollars fund. I'm like, I can't deploy a hundred million dollars and how am I gonna [00:29:00] get that? Like, no institution is gonna invest in us right now. Maybe fund three.
JP Keating: I wish I had a psychology degree and I wish I was better at sales because this would've been easier for me just to understand that piece, but it's just getting up and going at it every day. That's, it's just work, and prospecting like crazy.
Vlad Cazacu: Absolutely not that much different than fundraising for a startup, right?
Vlad Cazacu: It's, it's the same thing. The good connections to numbers. So I'm just curious how many if you can share, if you can
JP Keating: remember, right, like, oh, good lord, what are we talking like top of funnel here? Oh I'm probably over a thousand people at this point. I mean, it, it, it, I would venture to say, and then I follow back up with some of 'em, but it took a lot to get to one.
JP Keating: And the first one gave me real hope, like it was, I got the premier first investor and it, again, it was from a long, long, long time [00:30:00] friend and colleague and boss and just a blue chip guy on Earth. And so when he said yes, I'm like, okay, I'm onto something and somebody of this caliber trusts me and I'm gonna go with that.
JP Keating: And that. That's what did it. And so, you know, it's, it's building, it's building those relationships. Somehow or another. Some are built faster than others and it, I've been blessed that some of 'em built were built really fast. Other ones, like I've known them my entire life. And they're just not comfortable doing venture.
JP Keating: I was like, get it. It's all, it's all right. Don't worry about it. But, someday when I have a nice exit, they'll be like, Hey, can we get into the next one? And that's okay. We'll get there, but success goes on top of each other, right? It, it does. It's slower than anyone would expect, um,
Vlad Cazacu: especially in this industry.
Vlad Cazacu: It's a long feedback loop to,
JP Keating: to get there. And we launched at the worst [00:31:00] time, but we thought we were launching at the best time, which it kinda was. We didn't know that the, we didn't know the Russians were gonna screw up the world. And so, you know that that's really what broke things at the beginning.
JP Keating: But then it was, we wanna do deals and this is the best time. To get into the types of companies that we want to get into. They are doing everything that needs to be done right now to help the economy get better, to help society get better, to help win wars so we can't quit. We've got this thing, and with everything around decarbonization and climate and all that, we are in it.
JP Keating: We can't, there's no going back. We are so far into this. We are not going back. We can be successful here. It's just gonna take longer. And you had mentioned this, it's the typical startup approach. When I talk to startups it's like a therapy session. They're trying to raise money. I'm trying to raise money.
JP Keating: I'm like trying not to lose my allocations. [00:32:00] They're like, we really want you in, and it's so frustrating to be in that situation, but it gives me motivation every time I get off the phone with them. Like, look they're in the same boat I'm in, and they are working even harder and I can't quit on these people. They want me because they believe in what I'm doing. They're my ability to help them. And so I'm dedicated to doing that. There's no stopping yet. I, I love the energy.
Vlad Cazacu: Right. It's the, it's the same hustle mentality that most of the founders we have on the podcast though have, right? Because with them we're debriefing a successful round, with the emerging managers or we're debriefing funds that are being created.
Vlad Cazacu: So it's an interesting duality in that end, but it's a similar story all throughout. Um, oh, yeah, yeah. I'm just curious to, to understand a little bit better as we're wrapping up this episode: you've definitely had a number of battles scars over the past, uh, year or years Oh yeah. Of fundraising for this fund, if there were one or a few of some of the key insights that you now [00:33:00] possess that you didn't in the beginning. Um, yeah. And things that prospective, emerging managers listening to this would say, I'm not going to do that.
Vlad Cazacu: Um,
JP Keating: and learn from JPs mistake. Yeah. Yeah. So there's a, there's a couple of things. And luckily I avoided them, so I would just, I'll be positive about it, is. Get around good people. Just be around good people. Just stay away from the shady people out there. There's some folks out there right now that are like, oh, we're gonna teach you how to raise a fund and, you know, watch us on Instagram. Stay the hell away from those people. They're positioning it completely wrong and they're not talking about the amount of difficulty associated with doing this and the responsibility for managing other people's money, period. I take that extremely seriously and that I am a steward of their money and I'm not just going out willy-nilly trying to raise it.
JP Keating: And anybody that just [00:34:00] sort of looks says, I'm gonna go raise a fund and we're gonna do this. Okay. But you better have something to back it up. Now the other thing too is go into this understanding that getting funding from people is a hell of a lot harder than you could ever imagine.
JP Keating: If you are blessed to have a network of wealthy people, you are substantially better off than most people are. And it's just, you know, it's not, it's not a good thing, it's not a bad thing. I've seen success on both sides, and failures on both sides.
JP Keating: But I wish I would've had more of those when I began the journey. I thought I did, but then just the numbers game fell apart and I said, okay, now it's just getting to it. And then the other piece is too is just the thought that, anybody can do this. You really can't. I've reached that point where I feel pretty confident in my abilities to provide something of value to my LPs and provide something of real [00:35:00] value to my portfolio companies.
JP Keating: And yeah, I'm older. It took me 25 years to get to this point, but, I have that confidence level and people believe in me and my team versus folks that are younger. Maybe. I'm not knocking and I'm not being ageist. You might be able to do it, but I. Truthfully, there's, you know, the, the, the gray hair is there for a reason.
JP Keating: You know, you, you learned a lot along the way and it provides a lot of value in different things. So I would be careful about trying to jump into this too early and trying to start it on your own. I wish I would've started earlier but not that early. When I look back I would say that there's no way that I could have added any value to a portfolio company in my twenties at all, impossible.
JP Keating: No. Nothing of any value. Late thirties would probably have been the point where I said, yes, I can actually do something of value for you. So don't worry if you can't do it in your twenties, it's, you're so much more valuable later down the road. Working for a firm, not a bad thing. It's a great thing to learn, but [00:36:00] especially, and I argue too with folks that are looking at this as generalists, I'm like, I'm, you can't know everything about everything.
JP Keating: You just can't. Which is why I like, why I wanted the focused approach. We can diversify in our focus. Which works, but you can't really do it in some of those. So I didn't like the generalist one. I thought it would've been a disservice to the investors as well as the portfolio companies. So I said, let's do what we know and then go from there, you know, and, and that's, that's where I think you've gotta think really, really hard about what you're trying to do. You can do this, you can do this, but you really have to think hard and you have to understand how venture works and what the expectation is. And once you realize it, you can pull the trigger or not. And that's that.
Vlad Cazacu: Absolutely. Always do your homework, right? Something that we will learn from.
JP Keating: Always from children, but, uh, and, and
Vlad Cazacu: you're still gonna get pays off in the, in, in the adulthood of figuring out what you're really getting into before jumping head first,
JP Keating: and, and, and then you're gonna get, [00:37:00] then you're still gonna get kicked in the teeth. So just get ready for it, you know, it's, resiliency is a thing in this business.
JP Keating: Indeed.
Vlad Cazacu: I wanted to jump to the last piece of the interview, which is a quick three part rapid fire to get a little bit of better understanding of you as a person outside of you as an investor, and as a professional.
Vlad Cazacu: And we love to kick this off with a simple question, which is Sure. What do people don't know about JP Keating that they should know?
JP Keating: About you? Oh man. I don't know if we got that much time. Uh uh, no. The most unique thing that nobody really knows about me, um, see you got a lot of cool stuff in the back, like, I mean, yeah, I'm a hiker and all that.
JP Keating: You know, that's Mount Whitney. I love doing big hikes wherever I can. I love being out on the water. Just a general sort of outdoorsman. Most unique thing: I play the bagpipes. So no one would ever guess that one. I've been playing since I was a kid, so, uh, I got the kilt and [00:38:00] everything.
Vlad Cazacu: That is probably, and I'll, I'll have to check with Mark, but that's probably the most unique answer we got to this question.
Vlad Cazacu: So, Uh, that's
JP Keating: awesome. I try, I try. That usually sticks me out there. One of these days I'll show up at an event in a kilt if someone asks me to do it, but, um, yeah. Yeah. One of the more unique aspects of the community that I run in.
Vlad Cazacu: We'll do an in-person event for all the guests on this podcast.
Vlad Cazacu: Now, please ask you to show up in the kilt and play the back touch
JP Keating: at the. Done. We can make that happen.
Vlad Cazacu: The, the second part on that is: one person that you look up most to and the why
JP Keating: behind it. Oh, wow. That's a tough question. And here's how I answer it: so many people have influenced everything I have done and it's so hard to knock it down to one person. And what I have decided to do is I [00:39:00] think about traits of people that I truly admired in each of these people. They were all exceptional people individually, but they're traits, leadership traits, just their resiliency, their human skills, their insights. Just every aspect of these humans is exceptional to me. Their ability to sell and persuade people or just their ability to carry on a conversation or to influence a room and just have that presence, their empathy and being, and just being human in so many things here, because that is, that's the key to this work.
JP Keating: I like to distill things down to their very simple parts here, and I said, everything that we're doing here is all about people serving people. Nothing gets made for machines. For machines to buy. It's all of us. It's all of us humans out here doing stuff for humans. So I really like to look at [00:40:00] traits in folks.
JP Keating: Of course, of course. I always love Richard Branson, right? If you forced me into one word. I've never met Richard Branson, but I'm like, this is like the style I like. But There's just some fantastic human beings that are executives and that are just workers down on a line somewhere that I learned an immense amount from.
JP Keating: And so that's how I look at that. You know, it's, it's tough to nail down one 'cause I, I sort of do a disservice to all those humans out there that have helped shape me over the years. And I will never be able to get through my entire list of thank you someday if I win an Academy Award but I'll try my damnedest.
Vlad Cazacu: Wow. So you're really gonna dislike our final question, which is bringing you and all the other guests into a longstanding tradition for our firm which is ending every meeting that we have with shout outs and gratitude towards each other or towards other people as a way to get the, the rest of the team aware of some amazing things that are happening at our company or with our partners, or with [00:41:00] our clients, et cetera. Yeah. And we decided to bring this into the podcast. So every episode has now been ended with a very simple question: now overlooking your fund and your career and the next part of your journey who would you like to say a thank you and send some gratitude to?
JP Keating: Uh oh. Wow. Wow. Has to be one person, unfortunately, has to be one person. That's tough. Well, man. Oh man. One person. Okay. I will give you my one person and I'm gonna do it professionally.
JP Keating: There's plenty of personal people out there, and he falls into personal and professional. But when it comes to business, I always admire this man, and I still do, and I still talk to him to this day. It's Dennis Mullen Bird, who's the former CEO of Boeing. I worked for him years ago and I learned some of the best leadership traits from Dennis, and I learned a lot of difficult things along the journey and [00:42:00] everything else. But from a business leadership resiliency standpoint, definitely one of the biggest influences in my career.
Vlad Cazacu: Fantastic. We'd love to have him on the podcast at some point if he ends up building a fund.
JP Keating: We can probably make that happen.
Vlad Cazacu: Our thank you goes to you JP. Thank you so much for joining us today. Really, really much appreciated. Great conversation. A lot of learnings and a lot of notes that we took about you and your journey and building a fund in supply chain, an area that we don't have that much experience in, but we're always curious to, to learn more. So really appreciate you sharing all this thoughts and insights and stories with our audience and hope to have you back on the podcast as you're raising fund two. Um, absolutely. In a, in a few years. Absolutely. And debrief that raise and then see how approaching ventures evolve from a smaller fund to a larger fund later
JP Keating: down the line. Sounds great. Sounds great. I appreciate it, Vlad. Thanks so much.
Vlad Cazacu: Thank you.
Vlad Cazacu: What a great conversation. If you enjoyed it, make sure to like and subscribe to our [00:43:00] podcast and be on the lookout for a new episode in two weeks, featuring another amazing fund manager and their story. This podcast was made possible by Flowlie.
Vlad Cazacu: If you are a fund manager, angel investor, family office, or syndicate lead who receives a lot of deals or simply wants help sorting through the noise.
Vlad Cazacu: Create a free account today on Flowlie at flowlie.com, that's FLOWLIE.com, and get access to an AI assisted deal screening engine and network manager that will dramatically improve how you work.
Vlad Cazacu: Are you ready to take your investing journey to the next level and join hundreds of investors across the globe who use the platform every single day?
Vlad Cazacu: Find the discount code in the show notes and sign up today. That's it for today's episode. See you next time.