We chose to launch our series with an episode on a topic that we believe is extremely integral for both personal and professional development, a concept that is at the core of Matrix’s ideologies and forms a large part of the foundation, intrinsics. In this episode, Avnish Bajaj (Founder & Managing Director, Matrix India) takes us through what he thinks are the traits required by an individual to succeed against all odds, the ingredients of what goes into the makings of the best founders, and the essence behind our foundersfirst! philosophy. The transcript of the episode can be found below:

Intrinsics

Salonie: Hi and welcome to the first episode of the Matrix Moments podcast, a podcast series dedicated to startups, founders and everyone within this ecosystem. This is Salonie and we have with us today, Avnish Bajaj, founder & managing director, Matrix Partners India. In today’s episode we will be covering the importance of Intrinsics. So, Avnish why podcasting and why now?

Avnish: I thought you told me to do it, that was the main reason. No, Salonie, Thank you. I’m super excited that we are finally doing this, it’s kind of ironic because I am not much of a podcast user, meaning, I don’t listen to podcasts and I remember when you had first proposed it, I hope I did it in a nice way but I basically said “no, we shouldn’t do it” but, I think what I have come to realize is that there are people who actually listen to it, we got started with blogging I think the overall objective is to engage a lot more with the startup community, as the markets are deepening, as entrepreneurship is deepening in India, I think the engagement between the various parts of the ecosystem need to also deepen. Our attempt at podcasting, some of us tweet, all of those are different ways to go in that direction. I think what you have realized and what I have come to realize is that the barrier to authorship on blogging is just too high. This seems and then you suggested and Tarun suggested that we could do a podcast and a transcript and to me, you know there are people like me who like to speak but not listen so, I can speak and I don’t have to listen to myself but I can always read and I love reading, so I think podcast plus transcript is probably a great way and hopefully we will hear back from people in the ecosystem how it is working but super excited to do it, super excited to share thoughts and hopefully get lots of input back and create many more Matrix Moments together.

Salonie: So, in today’s episode we will be covering intrinsics and the importance of it in individuals. At Matrix a lot of emphasis has been given to intrinsics versusextrinsics as well as the inventory of skills, which is basically a set of characteristics that we believe are important for individuals to hone in on. Avnish, can you tell us a little about this, where this stems from and what the ideology behind this is?

Avnish: You know, I don’t quite remember exactly how we came up with it, but I can tell you that from day one when Rishi and I started the firm in 2006, we spoke a lot about what it takes for founders, as you know the philosophy isfoundersfirst!we spent a lot of time trying to figure out what is it? And I think everybody does. There is no right answer. What is it that gets people to succeed? And what is it that gets- brings the best out of founders or makes the best founders? And right then we had set up this inventory of skills which essentially talks about the various traits and there is a lot of emphasis on intrinsics versus extrinsics. Extrinsics is not a word, so don’t go looking for it in a dictionary. Extrinsics is basically what you see. Intrinsics is what’s inside. Now, the question is, why does it matter? I’ll give you two analogies, one, I was watching something from Sadhguru, which kind of helped me crystallize this thought even further, which is that, you know, you have ingredients, you have a recipe, and you have a dish. Ingredients and the recipe make the dish. Now, the question is as human beings do we all physically have the same ingredients? We do and yet we have seven billion human beings who are all different, right? I think in our business and as a philosophy of Matrix we have tried to figure out a lot more and, by the way, I gave you the mystic spiritual view of it, I can give you the very scientific view of it. The scientific view of it is: nature-nurture-product. Now, what happens is people generally or almost always only see the product, whereas what I think is more important is, to try to figure out what made the product? If you have to predict the future, looking at the current product versus thinking about what is the nature and what is the nurture and how would that environment change and therefore, what the product can be, I think is more important. So, for us that’s why it is important.

I remember reading from Sam Altman from Y Combinator, he said, and he is a young guy but he’s clearly figured it out, a very smart guy, he said, “the first 18 years of a person’s life tell him a lot more than the last seven years.” Now, the last seven years is extrinsics, now, this is typically let’s say we are talking about people who are experienced, right? You’re looking at resume’s, most of the time in an interview what do people do? “What have you done?” And it is a chronology which you can read anywhere. You never end up going deeper. So, that is really the philosophy that is almost a mission, and as we go further through this discussion we can talk about how it has played out and whether it really works or doesn’t work. Like I said, it is not an exact science; it is not even a science. But that is at least how we think about it.

Salonie: You have previously also spoken about the nine must have golden traits for entrepreneurs, so what exactly are these traits and the significance behind it, if you can share a little bit about that with us?

Avnish: So, they are not must have. If they were must have then nobody- I think anybody who has all of these doesn’t exist. It’s too good to be true. But let me give you a back story to this. Like I said, part of a personal mission, part of Matrix, thinking, part offoundersfirst!philosophy is about these intrinsics. Now, I am also a dad, I have children who are eleven and seven, and I have to put their names out here, Ariaan and Riaana, we were on an African safari and I have been reading this book called “how children succeed”, and essentially if I had to crystallize it down to one take away, it is that it comes down to character. What is character? Intrinsic. Now, given what I told you at the beginning you can see how much of that would have resonated with me. Now, these authors are PHDs, they quote lots of Harvard, Stanford, Yale studies, which essentially then distils the character down to seven traits, two I have added on my own, which we can talk about, but it distils itdown to seven traits. Those seven traits are: grit, self-control, zest, social intelligence, gratitude, optimism, and curiosity. I think, almost nothing requires explanation other than zest which is, you know the, it is kind of the risk taking, not really risk taking but adventurism, joy of life kind of stuff, one of Matrix’s core principal as you know is hunger and hustle right?

Salonie: Exactly.

Avnish: Now, there is a lot of thinking around which of these are overlapping but I decided to keep it simple and I added hunger and hustle on it. So, those are the nine traits. I know it sounds sad for my kids and the family holiday but we actually rated each other, including the kids, including people we know on a scale. So, it’s 0, 0.5 and 1 on each of these and believe it or not, all the successful people, and by the way Tarun, Vikram and I have done this with each other. We have done this with founders that we know, I have done this with people like Bhavish, for example and Ola I think has adopted some version of this. So, in general a score of six or more and now, when you say 0.5 and 1, 1 being someone, you know, who is really, really, good at it. So, I think, I am jumping ahead a bit on how actually this is useful, I think we will just keep going with this.

So, people are actually, you can use this in my view to predict co-relation with success and like I said, scores that I have seen, founders I work with, people I work with, my own family, and it is not us, and believe it or not what people rate themselves are generally a notch lower than what others rate them. I rate myself 0-0.5 on social intelligence which you might agree with but a lot of people rate me higher than that, for example, right? So, that is how you can use this stuff. I think, if I were to, then I thought further about it and I thought a lot more about it saying “but nobody has all of this” and is this even actionable? What do you do? By the way, I believe a lot of it is actionable, you could go trait by trait and say, how do you create that in somebody? Now, this is more coming from a parent perspective. But, I will tell you that if I had to pick traits and if I had to pick traits for entrepreneurs and if I had to pick traits for people in a profession like ours, as investors, they are actually different. If I could pick only three traits for an entrepreneur, which would be similar to what I would probably pick for my kids, I think it would be hunger, grit, which is resilience, and curiosity, by the way, these three are the same for both entrepreneurs and investors but now, if you force me to say you can pick only two, then I would drop grit for investors because you really need grit as an entrepreneur, be really resilient and I would drop curiosity for entrepreneurs. Hunger, has to be there, if you are not hungry it is not going to happen, right? But I would keep, grit, as the number one trait required for entrepreneurs and curiosity, as the number one trait for investors. Why grit for entrepreneurs? I don’t think it needs much of an explanation but you have to just keep sticking it out. Why not grit for investors, because investors actually in my view, an investor’s job is to minimize the unknown in their business, right?So, their job is to seek clarity, I just tweeted this morning about seeking clarity, confidence and the absence of clarity is disaster, right? Investor’s job is to seek clarity, you will seek clarity if you are highly curious, right? Entrepreneurs’ job is to execute, like I said, would love to have all three, but if I had to summarize it, I would say be hungry, be resilient and be curious. I think that would be my takeaway of what I would - obviously hat tip to Steve Jobs, but that is the line I would give.

Salonie: And with this, we come to the end of our first episode. Thank you for listening and please visitwww.matrixpartners.infor the transcript version of this episode. You can also follow us onTwitterandLinkedInfor more updates.