This article is part of Tech in Asia’s partnership with The Jay Kim Show where we publish the revised transcripts from the show’s podcast interviews with top entrepreneurs. This is heavily revised from the original show transcripts. For the full interview, go here.
James Giancotti is the CEO of a startup called Oddup. Oddup is a research platform that rates startups the very same way that equity research analysts rate and recommend a publicly listed company’s shares.
Oddup just announced the close of their US$6 million Series A round earlier this week, which is huge news. So it goes without saying that James has had a very busy week. Here, we go into a lot of detail about his company and specifically, we talk about how to get coverage on this platform. So if you are a startup founder, then this episode is for you.
Who is James Giancotti and what do you do for a living?
“I’m James Giancotti. I’m the CEO and co-founder of Oddup and we rate startups.
“[…] I’m a law graduate, so I studied Law at Melbourne in Australia, and then after I did that, I actually didn’t practice law, which is quite interesting. […] I went straight into consulting. I went to people like Deloitte and Capgemini and after I did consulting and business management (understanding and landing bigger projects), I went into investment banking that actually brought me to Hong Kong.
“So a lot of people ask, ‘What brought you to Hong Kong?’ And I always say it was love. I love money. You know, I joined an investment bank and started at JP Morgan. And after I started at JP Morgan, we had the financial crisis that we needed to have. I worked and started investing on the side in some startups and did relatively [well].
“It was a passion of mine. I always was an entrepreneur—my family’s been entrepreneurs for years. Then after that, I set up my own company in the background and then I joined Goldman Sachs for several years. The itch of being an entrepreneur was always there and after I left Goldman Sachs, I became an investor with my co-founder Jackie in Bigcolors.
“We had some exits very quickly. We actually built Oddup as a product of what we were doing as a VC, and that’s when Oddup found maturity. We were investing, we were putting research reports together, and people said, ‘This is really good. I’ll buy it.’ […] And then all of a sudden, more and more people told us this. Then Oddup was born. We started in Hong Kong all those years ago. So it’s been a very, very long but interesting journey.”
How does public-listed equity research work?
“Well, you know I spent a fair bit of time at Goldman Sachs […] particularly covering companies like Baidu and Tencent and so forth. The research is only as good as the analyst that gives it. But one of the things that’s particular with public research is that you need to understand the companies, you need to understand the founders. You need to have information that can help move a stock price. That’s the same thing with startups. A lot of investors will say, ‘Oh, you know I’ve seen a hot announcement on a hot company. That must be a good company.’ That’s not correct. Most startups can move with the wind in an hour.
“[…] One of the things that we made sure we did for Oddup was to make sure that we were covering the things that people do not cover. So, I’ll give you a good example […], WeLab. I know we’ve covered them since being a baby boy at 1 million dollars, and now they’re a billion-dollar company.
“Part of their success is, of course, Simon and the team. But a lot of their success has to do with fintech being hot, being in China, and being in the right location. So when we put a report together, and this is very similar to what public markets do, we’re looking at not just the founder. Let’s look at the investors who are pulling the strings; let’s look at the team that they’ve got; let’s look at the location they’re in; let’s look at the industry that they’re in. Are they hot? Are people putting money into this industry? So […] it’s not just the startup, it’s everything that surrounds the startup that gets investors and public people excited about it.”
How does a startup get on your radar?
“Typically, we have a rule and we stick by this rule. Usually, the startup needs to have raised some money. We need to benchmark them against something. […] Seed, even US$50,000, something so we can say, ‘OK, they’ve received money to do A, B, and C. We can benchmark them against something […].’ [We need to know] how much they’ve raised vs the others and where they were at different stages. It’s very hard for a startup to get rated if they haven’t got any publicity, any measure of traction, or any form of visibility.
“[…] So a company needs to actually have some sort of investment so that investors who are using our platform can go, ‘OK, which investor gave them money? Was it private money? Was it an accelerator?’ They need to have metrics so that they can start identifying it with other companies. So that’s usually the first thing. At least announce to us, even if it’s not TechCrunch– or Tech in Asia-worthy At least make us aware that you’ve raised some money.”
What’s the next step?
Do you ever get pushback from companies for your ratings?
What does Oddup look like in the next five to 10 years?
What is one piece of advice you’d like to give?
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