Derek Zanutto is a leading investor in data, security and SaaS-based enterprise software. He spearheaded CapitalG’s investments in Armis, Collibra and Dataiku and serves on multiple boards of directors.
Prior to joining CapitalG, Derek spent a decade investing in such companies as Uber, Airbnb, Lynda.com and CAA at investment firms TPG, Hellman & Friedman and GIC. Derek began his career at Morgan Stanley.
Derek holds an AB from Harvard College and an MBA with High Distinction from the Harvard Business School where he graduated as a Baker Scholar.
What qualities unite the CEOs and entrepreneurs with whom you work?
They often have three common traits: a vision for their product, the hustle to make it happen and the humility to know they can’t do it on their own.
We want CEOs who delegate tasks to brilliant employees, freeing themselves up to focus on strategy and to plan for the challenges and opportunities ahead. We look for active listeners who never stop learning, who stay curious and who continuously push themselves to keep adjusting to market realities.
How do you know that you have been successful with an investment?
It would be easy to look at returns as the primary mark of success but I like to think beyond that. I analyze where, as a partner, we’ve helped businesses grow faster than they would have without us.
It’s difficult to measure quantitatively, but I look at the specific instances where we’ve added significant value, like when we’ve helped CEOs to see challenges and opportunities in a different way and when we’ve provided specific guidance that has led to successful outcomes. These moments bring satisfaction and meaning to my day-to-day.
What signals do you look for when deciding to invest?
First and foremost, I look for teams who are passionate about driving change in the market -- leaders who live and breathe by their companies.
After that, I look at the data. There’s a lot that’s open to interpretation but some key questions I ask myself are: How strong is the leadership team? Is the product embedded in the lives of its customers? Is it susceptible to disruption or competitors? How many new logos is the company attracting each year? Are there emerging arms of the business that could be scaled? What do I believe market demand will look like going forward? The answers to these questions form the basis for all of our investments.
What role does CapitalG play for companies transitioning into their growth stages?
Investors primarily act as connectors. We leverage our networks and introduce businesses to experts who are able to answer questions and offer advice.
CapitalG is especially well-placed to do this. Beyond access to our immediate network, we can tap into over 100,000 Googlers’ in-depth industry knowledge. No matter the challenge, there’s someone who can provide tailored insights based on their learned experience.