[00:10:37] Ran Ding So the way I think about it is if you have a really strong company, and you feel like the business is stable and sustainable, whether it be bull markets or bear markets, then in a bear market, it might be a good time for you to explore putting your foot on the pedal even harder. And that comes in the form of maybe being more aggressive with acquisitions. You know, all of a sudden there are a lot more companies that might have depressed valuation expectations or different financial situations where you can take advantage of that. You should also potentially be more aggressive with acquiring talent. You know, if you look back maybe 12, 24 months ago, the talent market was absolutely crazy. And in order for you to compete with the best talent, you are not only competing with your peers, but you are competing with much larger or much better capitalized companies. Now, as we enter, you know, any semblance of a financial downturn, you'll see there are less companies potentially vying for that same top talent. And if you feel like you're on a very stable footing, that might allow you to get an edge in acquiring some of that talent. And on the acquisition front, on the talent front, investing in to go to market and a number of different areas, we have a ton of resources here in-house where we're helping our companies accomplish this in a more effective or frictionless way. And so that underscores the value of brand partner, even during a time where, you know, supposedly valuations are going to be compressed. 

[00:12:17] Michael So tell me more than about what it is that you bring to the table in a bear market. 

[00:12:20] Ran Ding Yeah. So as I mentioned, Norwest has been around for a very long time. So we've seen a lot of these market cycles. We feel like we have a good handle on how to navigate them. Now every market cycle is going to look a little bit different. But what we've tried to do through the last couple of years, even during this turmoil, is be in constant communication with all of our companies on, number one, how to be prepared in case something happens that you don't expect, right, whether that is maneuvering operationally or changing the strategy in some way. But then also number two, as I said, figuring out how to selectively play offense or do things in a very disciplined way where maybe your peers or your competitors are unable to do, because they don't have the financial wherewithal or the partners to go and do it, and for us to go and capitalize on those opportunities so that when the market cycle turns again, we will be in an even better position than we were today. 

[00:13:17] Michael It's really fascinated by so many growth companies that have come to recognize that the CEO is wearing multiple hats, and now is really the time to start taking off some of those hats and give them to people who can be dedicated to particular tasks within the acceleration phase of a company. 

[00:13:34] Ran Ding Yeah, absolutely. I think a lot of the companies that we work with, especially as they're slightly less mature, you have CEOs, founders, other executive members that are doing everything. And as the business continues to grow, what we found is that is not a scalable or sustainable way of growing. And even though you can probably maintain that level of growth and success for a period of time, what we see with a lot of companies in the past is if you don't diversify your responsibilities, then you run into the wall at some point, and that creates a lot more operational risk for the business at some point in the future. And so we do work and collaborate and try, and convince our CEOs, our very capable and competent CEOs to maybe delegate a little bit of that work, and find different ways to allow them and the company to scale better. 

[00:14:29] Michael What do you do when you come across a CEO's reluctant to take off a hat? How do you sell them on relinquishing an element of control. 

[00:14:38] Ran Ding I think that first and foremost comes down to having a foundation of trust. And so we spend a lot of time building relationships with people before we even make an investment. In some cases for many years, before we make an investment, just to make sure that we understand each other culturally, interpersonally, you know, and are aligned in terms of our operating philosophy. As it relates to specific business decisions, our general philosophy on this is we want to back the existing team. We take what we call an invited guest approach when we invest into businesses. And so we are going to be working with you actively, but we think of ourselves as the guests in your home. So we're not going to be changing the paintings on the wall unless you tell us that that's okay. What we will do, though, is we bring a lot of experience from working with hundreds of companies over decades, and relaying some of that experience to our specific companies. And your specific question around, you know, how we talk about maybe diversifying the management team over a bit. I think it comes down to sharing those prior experiences with other companies that were at your stage as they continue to grow, you know, they took one or two paths. One path was, they look to add to their management team and scale and delegate responsibility. And this is how that ended up. And the other path was people decided to go it alone, and we supported them. But these were the issues and risks that turned out as the company continued to scale. And we ultimately allow our leadership teams to try and make their own decisions. We hope that by sharing this data and these stories and these experiences, and sharing, frankly, the experiences of folks in our network who have lived it firsthand, that our leadership teams will ultimately make the right decisions. 

[00:16:31] Michael So while companies may be deferring capital transactions, they're not deferring growth. Ding's belief that to accelerate a company from a startup to a growth stage requires a founder to be willing to turn over the reins and certain parts of the business to a dedicated executive like finance or marketing is critical. And then companies like Norwest have experience helping guide those growth companies into their next phase. So I asked him, how much of this experience came from his time as a scrappy young guy at Union Square Advisors. 

[00:17:03] Ran Ding Union Square Advisors was, you know, I worked there about ten years ago, and at the time it was a fairly small investment bank. And I joined when the team was relatively small. And I think because of that I had an opportunity to really take on maybe an outsized responsibility relative to my title and my role. In some ways, I had a bit of empathy around what it was like working at a smaller business, helping to grow, and I hope that I could take some of that empathy into a lot of my conversations with CEOs and executives around their growth problems. Certainly the scale and scope, it's going to be different. But the feeling, you know, the attempts to navigate different risks and scenarios, hopefully we can find some shared commonality around that. Of course, beyond Union Square Advisors was focused on technology, M&A and transactions, and we were able to apply some of that industry knowledge to some of the areas that we invest in today. 

[00:18:04] Michael Having a sense of empathy towards the people with whom you work is really sort of a critical superpower when it comes to being able to do what you do today. 

[00:18:13] Ran Ding I would say so. Look, I think ultimately the role of the management team and the entrepreneur is an incredibly tough job. And we also understand that it can be an incredibly lonely job. And the last thing that a CEO or management team wants is for somebody to come in and be overbearing and tell them that they're wrong and this is what you should do. And so we certainly try and lead every conversation with a strong attempt to understand what it is that they're doing, what they're going through, both positives and negatives, and just make sure that we can be there as really a true partner. I think of myself as in the best scenarios working with companies, I can be sort of a partial co-founder, right? I'm living the same problems as the management team, and I am there, you know, with no other agenda other than to try and help them solve those problems. 

[00:19:09] Michael What about your background in electrical and computer engineering at Cornell? Does it help inform your relationships with companies today? 

[00:19:15] Ran Ding Well, I wish I could say it helps inform my industry knowledge and understanding of technology more. But the fact of the matter was, I probably was not a great electrical and computer engineering student. And that was partly why I decided to transition from a career in engineering more towards a career in finance. But look, my background was both of my parents were engineers, so that was all I knew growing up. I always had an interest in both technology as well as in this concept of helping things grow or helping build things. And so ultimately I felt like moving into investing where we were continuing to help technology companies and importantly helping them grow would be something that I would really enjoy. 

[00:20:03] Michael Yeah, I can imagine there's sort of a relationship between engineering and what you do today, insofar as you're both building something. 

[00:20:11] Ran Ding Yeah, that's right. But components of it are different. The sequencing of it is different. But ultimately, that's why I do feel fortunate in working in a sector and an area of investment growth equity that is more specifically focused on growth, because as you know, there are a lot of different ways to invest and there are a lot of different ways to be successful financially. But I feel like I've found an area where certainly as an asset class and as a group, we've been successful. But beyond that, the act of helping these companies grow has really resonated with more of my personal mission and my personal values. 

[00:20:49] Michael So when you told your engineering parents, you weren't doing engineering, how did that go over? 

[00:20:53] Ran Ding Yeah, they're used to, you know, individuals staying at the same company for 30 years, and never changing jobs or changing careers, so it was definitely a bit of a shock. But I think over the years, they've learned to trust my judgment a little bit more. 

[00:21:09] Michael Ran, thank you so much for your time and insight today. 

[00:21:12] Ran Ding Thank you. 

[00:21:15] Michael There's no doubt Ding's parents are not disappointed he moved from engineering into where he is today. Ran Ding has helped make Norwest the success it is today, as the world shifts to B2B software, data and business services. Thanks to COVID 19 and a shift to a work from home environment. It's just another reminder to company founders about the importance of knowing what you're good at, and knowing when to turn to someone outside your area of expertize. I'm Michael Hainsworth, thanks for listening.