Betting On The Unconventional With Draper Associates’ Andy Tang

**Brett Winton** (0:00)
On this episode of FYI, we talked to Andy Tang, who's a partner at Draper and Associates. We talked about body parts in bags, artificial wombs, and all of the unconventional ideas that Draper is investing in. It's a great listen and a lot of fun, so enjoy.

**SPEAKER_3** (0:23)
Welcome to FYI, The For Your Innovation Podcast.
This show offers an intellectual discussion on technologically enabled disruption, because investing in innovation starts with understanding it. To learn more, visit arkinvest.com.

**SPEAKER_4** (0:41)
ARK Invest is a registered investment advisor focused on investing in disruptive innovation. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. It does not constitute either explicitly or implicitly any provision of services or products by ARK. All statements made regarding companies or securities are strictly beliefs and points of view held by ARK or podcast guests, and are not endorsements or recommendations by ARK to buy, sell or hold any security.
Clients of ARK Investment Management may maintain positions in the securities discussed in this podcast.

**Brett Winton** (1:16)
From ARK Invest, this is FYI, The For Your Innovation Podcast. I'm Brett Winton. We have a great show for you today. It's Andy Tang of Draper and Associates. Andy, you've been a VC Investor for 20 years. Before that, you're an MIT guy like me. You're in semiconductors. You've invested in, I mean, according to the bio, like 15 unicorns. You're also the host of the podcast Post Money.
Welcome to the show. How are you?

**Andy Tang** (1:40)
Good. Thank you for inviting me. Let's see if you can do the high five.

**Brett Winton** (1:43)
Yeah, yeah, yeah.

**Andy Tang** (1:45)
Chase, all right.

**Brett Winton** (1:46)
Yes, and then this is Chase. He works on our venture team. Chase is helping with the Venture Fund for us. Andy, Andy, okay, you have this technical background. You ended up in investing, but you worked at Intel at some point, right?

**Andy Tang** (1:58)
I'm a recovery engineer, as some would call it.

**Brett Winton** (2:01)
Yeah, and at this moment in history, I think investing in semiconductors in startup land has historically been a good way to incinerate money. Now suddenly, semiconductors are a place that you can apparently make money.
How do you think about the overall state of play of seed investing, investing with technical fluency, and what are you looking at in the landscape of investing today?

**Andy Tang** (2:26)
It feels like the table has turned again, that cycle is a 30-year cycle. When I first started my career, as you mentioned, I was a semiconductor engineer, and we were all worried the Japanese were going to take our jobs. I don't know if I'm maybe dating you, Brett, but that was a scare. But it turns out that I think we were probably too pessimistic.
And I think the world is actually more abundant than that. So I'm very optimistic about semiconductor coming back.
It being a source of innovation, a lot of the reshoring activities, I think America is actually pretty lucky. I think we're very lucky in that our manufacturing base, while it was interrupted by globalization, but it's in the perfect place to automate. You don't have to worry about getting rid of assembly line workers. They're gone. They already moved to China. So it's our perfect chance to reinvest in America's manufacturing 2.0. And Semiconductor, I think it's in the heart of that. Semiconductor industry itself is a highly automated industry. And then the product itself is going to help us automate the rest of our hardware manufacturing in the US.

**Brett Winton** (3:59)
Yeah.
And so, within the context of, so Draper typically does seed and all the way through series A investing, right? And so it sees a lot of early stage opportunities. As you look across all the opportunities you've looked at, you know, over the last year, has there been a notable like change in the flavor of things that you are interested in and that are coming to you, measured over at least the last couple of years?

**Andy Tang** (4:26)
For sure, right? These hardware or deep tech companies used to be, oh, too capital intensive. Why would you do that? It's not VC's asset class. To suddenly, oh my gosh, let's look at that. We, of course, we want to look at deep tech companies. Of course, it's going to be a hundred million dollar seed round, you know? Right.
So it's coming back, right? It's coming back. And we, as a seed firm, we kind of see the index of the market. We definitely see more deep tech founders really coming out of woodwork. And I think it's good. I think it's good.