Julia Samoylenko of software producer Proseeder interviewed Faran Nouri, managing director of Lam Capital, the investment vehicle of semiconductor processing equipment company Lam Research. Nouri explained to the audience how the venturing unit she headed was structured: “We invest from the balance sheet but we are a separate limited liability company and run like an evergreen fund.”
She also shared Lam Capital’s approach to finding potential investment: ”In the beginning, we wanted to get access to deal flow, so we were looking for best practices and to build relationships. Today, six years later, we get more dealflow than we can cope with but the first couple years it was not easy.”
Nouri also shed light on the stage-orientation of the venturing arm: “We are an early stage investor. We think, as a CVC, we can add most value at this stage. Our sweet spot is series A and B deals. We do follow-on investments afterwards.”
She told the audience about some of the challenges of establishing Lam Capital within her organisation: “When we started out, a lot of people saw it as a waste of money. It really needed support from the CEO and a lot of establishing relationships, educating and communicating internally.”
She encouraged nascent CVCs to seek advice on structure and best practices from established venturing capital funds: “There is a lot of data, information and best known practices now but when I started there was none, so I had to talk to GV and Intel Capital and people were very generous in sharing a lot about their practices.”
Nouri also summarised the overall dynamics of the industry of the corporate parent of her fund: “The semiconductor industry is in the middle of the data and AI disruption. You need a new class of storage memory chips developed. You have big tech entrants coming into the market and when they do not find a chip that works for them, they are willing to partner startups or try to make it themselves.”
