As a managing partner at Ignition Partners, John Connors has used lessons from his small-town upbringing to help raise and invest approximately $1.5 billion. Connors spoke with 425 Business about his entrepreneurial childhood, his time spent as an executive at Microsoft, and the area’s still-hot venture capital scene.
If we were playing a game of “guess his occupation,” knowing where John Connors grew up probably wouldn’t be much help. But knowing how he grew up would be extremely helpful in determining the amount of success he has had.
The “where” was Miles City, an Eastern Montana pit stop located at the confluence of the Tongue and Yellowstone rivers. The “how” — in addition to being one of seven kids in an Irish family led by a coach/teacher father and a mother who was a newspaper reporter — looks like this:
- He got his first job, a paper route, when he was 10 years old.
- He held summer jobs in junior high and high school on farms and ranches.
- To put himself through the University of Montana, he worked on railroad gangs and in the oil field in Eastern Montana and Western North Dakota.
“I learned to work really hard,” Connors said of his childhood, “to figure out how things worked and to stay on the job until it was done.”
Back in Montana, the job was done when his last newspaper was delivered, his last field cleared, or when the sun set on the oil field. Today, Connors’ job can be considered “done” at various points. He’s managing partner of Ignition Partners, a 16-year-old venture capital firm founded by former Microsoft and McCaw cellular executives. With offices in Bellevue and Palo Alto, California, Ignition invests in startups that are principally focused on software for business customers. His company currently is investing out of its sixth fund and has raised and invested roughly $1.5 billion.
A former Microsoft executive himself, Connors agreed to sit down with 425 Business to talk about early Microsoft, his venture capital firm, and why he and his wife believe community involvement is crucial.
Q: How did a kid from Miles City, Montana, end up working in the heart of the technology world?
A: I moved to Seattle out of college to work for Deloitte, Haskins & Sells. Bill Gates’ sister worked in the tax department at Deloitte. Microsoft became a Deloitte client out of Deloitte’s small business office in Bellevue. Several guys I knew got hired early at Microsoft and I was lucky to know them. I interviewed in 1988 and was astounded at the quality of the people and the rigor of the interview process. I was hired in January 1989 into the finance organization. From there, I was hired into the systems division that at the time was headed by Steve Ballmer. Steve became an important mentor and leader throughout my years at Microsoft. The company was growing exponentially so there were many opportunities for advancement. I learned a great deal about the industry in the varied roles I held.
Q: Your career at Microsoft was quite varied — tell us about that experience.
A: I still can’t believe I was lucky enough to join the technology industry in its infancy, and even better, to get hired by one of the best companies in business history. Microsoft was a perfect place for me — people worked extraordinarily hard and you were surrounded by many of the smartest people ever assembled. The company had customers and employees in every country in the world. I got to know people from every industry, demographic, and culture the world had to offer. (It is an) extraordinary company with exemplary leaders and talent.
Q: What was it like to move from a huge company like Microsoft to being a partner in a venture firm starting companies from nothing?
A: It was exciting and frightening because I had no idea what I was doing. Fortunately, one of my early investments was a company called Xensource. It turned out to be a hit — we sold it a year after investing for a 5x return. More importantly there were two outstanding Silicon Valley investors on the deal that I got to learn from for a year. One of them, Nick Sturiale, now runs our Palo Alto office.
Q: What does a typical week/month look like in your world, having offices in Bellevue and Palo Alto? Are you constantly traveling between the two?
A: We have partner meetings every Monday where we review existing companies and evaluate new opportunities. We alternate meetings between Bellevue and Palo Alto. The Palo Alto meeting days for me start with a car pickup at 4:45 a.m. and end with a drop-off at home between 7 and 10 p.m. The remainder of the week is spent working with existing companies on strategy, recruiting, and company introductions. I currently have seven companies where I am principal partner. I also spend time meeting companies and people for our network of companies. Last year, I reviewed or met approximately 120 companies. I only made one investment out of those 120 reviewed or meeting.
Q: What’s unique about the Seattle-Eastside startup scene compared with that of the Valley?
A: The Puget Sound region is emerging as the world’s second-most important startup economy for business software after the Bay Area. The region has the two most important companies in the enterprise computing world — Microsoft and Amazon Web Services. Every single company we work with regardless of location is either working with these companies or very focused on knowing what their plans entail. Our region has abundant engineering talent and a growing roster of capable entrepreneurs. The most distinguishing feature of the region is the depth of technical talent.
Q: What values does Ignition Partners use to gauge its business opportunities?
A: The companies have to have big bold ideas in large market opportunities. We look for perseverance in the founding team because it is going to be extraordinarily difficult. We require leaders who will build a culture that can attract and keep talent. We also require honesty and transparency — we need to know what the challenges and problems are early so they can be addressed. We also try to have a lot of fun and be the most important board member to management teams.
Q: How did you become involved with Nike?
A: Microsoft had an executive sponsor program while I was there. Senior executives were responsible for the overall relationship with major corporations worldwide. I had eight accounts in this program, including General Motors, Nike, and Citigroup. I really liked the Nike leadership and culture. I was approached to join their board of directors in 2005 and gratefully accepted the appointment. I think Nike is one of the most impressive brands and companies in the world.
Q: What do you consider your most significant accomplishments in venture investing?
A: By far the most significant accomplishments are the incredible founders and the thousands of great-paying jobs the companies have created. Secondly are the results for our investors — mostly pension and endowment funds. I have been lucky to have one company go public (Splunk), and six others have been acquired by companies such as Microsoft, Facebook, and Salesforce. Our fund returns have been very strong, and that helps in winning new deals.
Q: Involvement in the community is very important to you. What are your passions in that regard and why?
A: Kathy (Connors’ wife) and I team up in this area, and it is very rewarding. Kathy sacrificed so much for so many years running the family as I was working long hours and travelling extensively. We are very focused on efforts in three primary categories — youth education and activities, faith communities, and free-market think tanks. We believe each of these areas has multiplier effects to improve individual lives and communities. Additionally, Kathy has a deep commitment to the humane treatment and care of animals. She is very active in the Seattle Humane Society.
This article appeared in the June 2016 issue of 425 Business.