David Pakman is an avid musician, Internet entrepreneur and venture capitalist. Since 2008, he has been a partner at Venrock Associates, a venture capital firm, where he focuses on digital media and Internet companies. His current investments include Dollar Shave Club, Smartling, Singly, Crunchyroll and Media6degrees.
Before becoming a venture capitalist, Pakman’s career revolved around the music industry and digital media. In 1995, after four years of working under Charlie Oppenheimer as a project manager for Apple Inc.’s System Software Product Marketing Group, Pakman became the co-founder of Apple’s Music Group. While there, he also co-founded the Macintosh New York Music Festival. The group came into the music industry right at a time when the internet and digital distribution were emerging, which led to Pakman’s becoming a pioneer in webcasting. His work in webcasting includes co-producing the 1997 GRAMMY Awards — the largest webcast at the time.
After another four years with the compay, Pakman left Apple and began a two-year stint as VP of business and product development at N2K Entertainment. At the time, the company consisted of only 30 people, but by the time he left in 1999, he helped to create the first digital music download service.
With his departure from N2K, Pakman’s next career-defining moment came in 1999, as the president and co-founder of Myplay, Inc. Pakman revolutionized the music industry when he and Doug Complejohn created the first digital music locker. By 2001, they sold the company to Bertelsmann BeMusic, but not before acquiring eight million users. He stayed with Bertelsmann for two years as senior vice president of corporate development and public policy as part of the acquisition.
He then spent a year as strategic advisor to the digital media locker Mediacode, where he leveraged his experience to help sell the company to Yahoo!. In 2003, he was also managing director of Dimensional Associates, a private equity firm that focused on digital media, and stayed with the company until 2008.
During this time, Dimensional acquired eMusic from Vivendi Universal and, in 2005, Pakman became the CEO. Under Pakman’s watch, eMusic, which focuses on indie music, became the second largest music retailer in the world (after iTunes), and by 2008, the business grew from $7 million in revenue to $68 million — an 850% increase.
From 1999-2008, Pakman was also the director of Knitting Factory Entertainment, where he helped develop the company’s record label and nightclubs.
Pakman holds a BSE in computer science engineering from the University of Pennsylvania. During his time at the university, he co-founded the Dining Philosophers, a computer science group at Penn Engineering. From 2007-2010, he was a member of the Board of Overseers for the university’s School of Engineering and Applied Science.
He currently serves on the board of ITHAKA, a not-for-profit organization that helps the academic community preserve scholarly records and advance research methods. He is also a member of the New York Venture Capital Association.
Pakman has testified before Congress and the NTIA about the Digital Millennium Copyright Act (DMCA), and in front of the U.S. House Judiciary Committee Subcommittee on Intellectual Property, Competition and the Internet about Internet radio licensing.
VC Firm:
Partner at Venrock Associates (Founded in 1969)
Sector Focus:
Advertising, Big Data, Cloud Computing, Consumer Services, Crowdsourcing, Digital Media, E-Commerce, Internet, Mobile, Personal Data, Real Time, Social Media, SaaS.
Boards:
ITHAKA
New York Venture Capital Association
Dollar Shave Club
Smartling
Singly
Crunchyroll
Media6degrees
Blog, Twitter & Websites:
Expertise Areas:
Venture Capital Investing, Digital Media, Strategy, Launching Internet Companies, Operating Startups, Building Teams, Leadership, Business Development, Technology, Capital Raising, Recruiting, Software Architecture, Sales and Marketing, Platforms and Deal Making.
Memorable Quotes:
On the best way to ride out a bubble: “Venrock is a VC firm that has been investing in startups for more than 40 years. Needless to say, this firm has seen many cycles come and go. Our approach is to keep our bar really high and invest in approximately the same number of companies each year, regardless of economic conditions or where we are in a cycle.”
On what makes an entrepreneur successful: “Their ability to judge signals really well. They’re getting feedback from the market quickly and they’re making some changes and adjusting their business plans, ideas or products quickly. Unsuccessful entrepreneurs stick to one thing too long or won’t make changes to their team quickly enough.”
On how VCs think: “VCs invest in teams first, market second and ideas third.”
On what’s the biggest difference between being a CEO and a VC: “Listening. As a VC, 90% of the job is listening — you’re listening, you’re observing, you’re looking for patterns, you’re looking for mistakes you’ve seen in the past and you’re guiding, but you’re not in control. As a CEO, all the responsibility falls on you and you’re probably listening a bit less.”
A perk about being a VC rather than an entrepreneur: “I want to participate in all the innovation. So, as a VC, you get to do that. As an entrepreneur, you’ve go to pick one.”
One thing to do before you even start pitching: “Make a short list of the people who are most likely to be interested in what you’re thinking about. Meet the VC long before you need to raise money. Start a relationship. One of the best things you can tell VCs is, ‘I’m not raising money,’ which gets their antenna up right away.”
On how VCs should communicate to entrepreneurs they have to turn down: “My view is share information with entrepreneurs about why you think things are different or why they’re not a right fit for you, but also don’t write a whole thesis, a whole paper, on here’s the 18 reasons why it doesn’t make sense for us.”
On the deals he’s looking for: “I want to find deals that are not what everyone else is looking at. I mean, I sort of feel like the deal that is a consensus, that everyone agrees is going to be the next hot thing, probably won’t be the next hot thing.”
The technology innovation he thinks the world needs the most: “The way to transfer the knowledge of books into your head without having to read. I can’t take credit for the idea. I heard about it from this Google offsite of great ideas, but, boy, that would save me a whole lot of time.”