A Conversation With David Orban, Network Society Ventures
Earlier in the year, there were a significant number of victims who came forward to share stories of sexual harassment by investors [in the United States]. Some of those investors were prominent VCs. At Forward Partners we were really saddened by the reports – clearly, any abuse of an asymmetrical power relationship for sexual gain is wrong. Doctors have been held to a high standard in this regard for as long as I can remember and investors should be no different. So a couple of weeks ago we adopted a new Code of Ethics for Sexual Harassment.
I think this is a positive step in the evolution of a sector that has been male-dominated. Nic makes a comparison of venture capitalists with the code of ethics of doctors, and I think this is an interesting point to make, as historically, women were often ostracised and prevented from pursuing a medical education around the world for many centuries. The first female doctor in the UK had been Dr. Margaret Ann Bulkley, who in 1809, disguised herself as a man, James Barry, to attend medical school, and later became a Royal British Army surgeon. It wasn’t until her death in 1865, upon examination of her body, did the truth come out about her identity.
Elizabeth Blackwell, who was born in the UK, applied to many medical schools and had been denied entry to every one until the dean at the Geneva College of Medicine in New York presented her application to his medical students and asked the question if a woman should be allowed entry? The male students unanimously voted yes, and Dr. Blackwell became the first woman in the United States to graduate with a medical degree in 1849.
Unconscious bias, cultural perception of gender, and biological assumptions of gender have prevented women from entry into many male-dominated sectors; however unconscious bias is something that we all possess, but hard to quantify.
Earlier this year, I spoke with a venture capitalist, David Orban, Founder and Managing Partner of Network Society Ventures, which invests in the intersection of exponential technologies and decentralisation. I first met David at an AI Conference in Seoul, a couple of years ago, where he was one of the keynote speakers. David has an immediately personable, affable, and iconoclastic mindset.
David has a rather colourful and unusual background. His parents were artists; his mother was a painter, and his father was an actor. He grew up in Budapest, Hungary and was exposed to all different kinds of stimulation. As a child, he read a lot of books, in particular, science fiction, and then moved to Italy with his mother when he was 14 years old and studied physics at the University of Milan and University of Padua, but realised that he didn’t just want be a cog in the machine, and that the professional life of a physicist wouldn’t be for him. He left university without a degree to pursue his own interests and followed his curiosity, and eventually was present at the birth of Singularity University.
David tells me that curiosity is what drives us to learn. By asking questions, making remarks, engaging in dialogue; these are what differentiates you from everyone else through the act of sharing. He was part of the group that designed Singularity University with the purpose of analysing and accelerating technological change, in an attempt to give its participants the best way to prove themselves through information and knowledge in a project based methodology.
In venture capital, AI has infiltrated many aspects of decision-making processes, and at times, usurping human decisions. The application of AI-driven criteria for potential investment capital has been around for many years; in particular, I am reminded of the controversy between the VCs at Google Ventures in Silicon Valley and in London. London VCs were not allowed to choose companies of investment due to some glitch by an AI-driven programme at the Mountain View office, in which the criteria for investment had to be approved by Google’s algorithm rather than the knowledge of its human staff in executing deals. This became the catalyst for many British VCs to leave the London office and eventually lead to the closure of the European branch of the Google Ventures arm in 2015. The controversial former CEO of Google Ventures, Bill Maris left the company a year later. It is unclear if Google still utilises its AI in lieu of human decision making to determine its investment capital at the present time.
However, David tells me that although AI factors into the process of choosing a startup to invest in at Network Society Ventures, that the aim is not eliminating the human component. Typically, his team collects early signals, early indicators of future success, together with the quality of the team and any kind of indicator of traction. In our early conversations, David wanted to use AI to weed out unconscious bias, criteria such as being graduates of top schools, from certain socioeconomic classes and other factors in which Silicon Valley seems to heavily favour Stanford graduates with engineering degrees.
I ask if his AI is able to determine outliers, such as Airbnb and even the young David Orban to invest in? Airbnb was founded by two art school graduates at the Rhode Island School of Design, who had zero traction for their service, perhaps 5 customers at the time a year after its inception, and the founders were making cereal boxes at the Democratic National Convention before they had been narrowly accepted into the Y-Combinator accelerator. Airbnb is now one of the most valuable companies in the United States to the surprise of many VCs who refused to invest in them at the time. Would Airbnb have passed their initial investment criteria?
“Ah, that is a good question. AI has great potential. What we call intuition in the human mind allows us to make leap-of-faith decisions. Can AI surpass the human mind at this point in time? Maybe someday.” -David Orban, Founder and Managing Partner, Network Society Ventures.
David is also unusual in how he thinks about startup governance. At Network Society Ventures, although they don’t take any board seats from the startups they invest in, they do typically tend to be board observers.
One of the manifestos of Network Society Ventures is to invest in companies that move away from “slavery” (E.g., to enslave a poor population in order to create value for another population); to increase availability of resources and goods for all. In previous eras, David tells me, there have always been two extremes and the most important is the foundation of how energy is distributed. Energy is what shapes civilisation, and the economic uncertainties of today are not the same as in the past, when we lived in a feudal society and people had been exposed to hunger and unclean water because they didn’t have access to energy.
“The distribution of energy is what shapes civilisation.” - David Orban, Founder and Managing Director of Network Society Ventures
David tells me that time spent with family is as equally important as work. “Work, by itself, has little meaning when we are not doing what we want to do in life, but for mere survival. Time with family and one’s community allows people to understand complex problems in our society and go through ways to solve them...We do not exist in a vacuum. Universal income is a means for us to explore and be able to solve the hard problems that plague our society. In a salary-based, hourly wage society, we are prevented from exploring potential business ideas and from reaching our highest potential.” Although universal income sounds utopian in its ambition, and there are many critics of the plan, trials of universal income have lead to success in nations such as Finland.
“Universal income is a means for us to explore and be able to solve the hard problems that plague our society. In a salary-based, hourly wage society, we are prevented from exploring potential business ideas and from reaching our highest potential.” -David Orban, Founder and Managing Director of Network Society Ventures
Having known David as a global jetsetter who commutes from Milan to New York to London every couple of weeks; he has found his own rhythm in New York (“I like to get coffee and croissants in the morning and stroll through the city.”) in what he calls a technomadic lifestyle. “We are very lucky to be living in our current era. We can leverage the global infrastructure that is available everywhere.”
David’s motto is: What is the question I should be asking?
By Sierra Choi