InterviewInterview with Vice President, TCV – David Zhang

FintecBuzz FintecBuzz3 weeks ago14 min
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David Zhang Vice President, TCV

David joined TCV in 2018 with eight years of experience in the global tech industry. He focuses on investments in internet, FinTech, and digital media. His current investments include Nubank, where he is a board observer.

1. Tell us about your role in TVC?
I evaluate internet, media and fintech investment opportunities around the world. I also have the privilege of working with some of the most generational entrepreneurs in the tech scene.

2. Can you tell us about your journey into this market?
I began my career by founding and running an internet startup, which sparked my passion in technology. I have spent the last decade in the tech scene in various roles – first as a startup founder, then as an investment banker, then as a public markets investor, and now as a crossover growth investor. I consider myself lucky for having had exposure in multiple geographies, which is a valuable experience as technology trends tend to be global in nature.

3. How do you think technology is redefining the financial sector?
At the heart of it, technology is the most powerful way to improve lives and workflows – devices are constantly becoming faster, smaller, cheaper, better! The financial sector is particularly massive because of the way it is ingrained in the daily lives of consumers, businesses and organizations. Because of its sheer size and generally arcane structures, technology and innovation tend to be less fluid. In the U.S., over half of business-to-business payments, today are still done by paper checks, and it still takes two or more days to move money between bank accounts! As a result, there are endless opportunities for prospective entrepreneurs to leverage technology to provide point solutions for businesses and transformative consumer experiences.

4. Can you explain the criteria you keep in mind while selecting a business to invest in?
As a growth investor, we look for secular tailwinds, strong user value propositions, product-market fit, durable moats, sensible business models, and ultimately true earnings power. We also look for inflection points, which helps us skate to where the puck is going. But above all, we look for a rock-solid and innovative management teams that have extraordinary strategic vision and are able to execute.

5. How does investing in multiple stages help TCV as well as the businesses that are getting investments?
TCV provides capital to growth-stage private and public technology companies. Our investments can range anywhere from $30M – $300M.

Companies are living and breathing creatures – they go through life cycles just like we do!

It starts with the birth of an idea, bringing the product and service to the market, figuring out a business model, scaling growth, and then eventual maturity. The best companies are able to continuously innovate to find new vectors of growth. At TCV, we have over two decades of investing experience across the entire spectrum – we leverage that muscle memory and DNA to identify what great companies and management teams look like. Our portfolio companies also benefit from our ability to leverage multi-year horizon perspectives as a sounding board, and a wide network of executives in the TCV family who have strong operating experiences across the spectrum of growth stages.

6. Can you tell us about a fintech growth company that you are involved with?
We recently led a growth round in Nubank, the largest global digital bank outside of China and based in Sao Paulo, Brazil. David Velez, Cristina Junqueira and Ed Wible are incredible founders and operators and have leveraged technology to create a great consumer finance experience in Brazil and Latin America. We are incredibly excited to be part of their journey in transforming the financial services industry in Latin America.

Closer to home, we have been fortunate investors in Tastytrade for a number of years. Tastytrade is a veritable force among do-it-yourself traders, offering live commentary and educational content about all things finance, as well as a digital trading brokerage arm. They recently launched a commission-free trading app called dough (https://dough.com/). Dough’s CEO Victor Jones has built an incredible product and team, and we are pumped about their growth prospects.

7. What is the most important trait in a CEO that you look for?
We look for visionary CEOs who are obsessed with creating the best user experiences, relentless about surrounding themselves with strong executives and understand the importance of building amazing work cultures. Great examples include Reed Hastings at Netflix (we have been investors since 1999) and Daniel Ek at Spotify (we have been investors since 2013).

8. What makes a good board of directors?
Being a trusted advisor and a reliable sounding board. We serve on 8 out of 10 companies we invest in and have backed over 350 companies since inception in 1995. TCV’s approach to a board director role is to align ourselves closely with management teams, and relentlessly provide support and guidance to help them achieve greatness.

9. What are the major technological developments in the financial services sector that you think will define the next 5 years?
Pay attention to mobile banking, instant payments, and blockchain.

10. Can you tell us about your team?
We have a diverse team of investors at TCV with different backgrounds and experiences. That provides a tremendous advantage in having a broad range of perspectives, which and also has the added benefit of preventing group-think. We help our companies scale their businesses by providing support with identifying growth opportunities, accelerating customer acquisition, and recruiting talent. We provide first-name introductions to top innovators in and beyond Silicon Valley, Europe, Asia and beyond, connecting our companies with industry captains and leaders in their fields.

11. What movie inspires you the most?
Hamilton – it is a musical today, but should absolutely be made into a movie!

12. Can you give us a glance of the applications you use on your phone?
My home screen apps today are: Cash App, Spotify, Netflix, Amazon, iMessage, WhatsApp, Uber+Lyft, Google Maps, Gmail, and Sleeper.

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