When Alice Brooks, an investment partner with California-based Khosla Ventures, traveled to Albuquerque in early September for a local technology forum, it wasn't her first time in the Land of Enchantment.
Brooks, a Massachusetts Institute of Technology, Stanford University and Harvard Business School graduate, came to New Mexico in the summer of 2023, making a trip to Los Alamos for a tech showcase event hosted by Los Alamos National Laboratory.
A few months later, the Northern New Mexico city and its national laboratory caught headlines when Spiritus Technologies, a climate tech startup headquartered in Los Alamos, emerged from "stealth" mode with $11 million in hand and a carbon capture approach it said could shake up a typically expensive market.
Khosla Ventures, headquartered in Menlo Park, led Spiritus' first funding round. The Los Alamos company, Brooks said, represents the sort of startup she and Khosla are interested in — a company that is "bold and very early and with a strong technical differentiation and background."
Spiritus spawned from an absorption technology Matt Lee, Ph.D., the startup's co-founder and chief technology officer, worked on while a scientist at Los Alamos National Laboratory. Lee paired up with Charles Cadieu, Ph.D., an experienced startup founder with whom he had a previous connection, to form Spiritus; Cadieu is the startup's CEO.
Brooks said Khosla often looks to foster that type of pairing between a scientist with an innovative technology and an entrepreneur with business experience and savvy.
She offered another example of a fusion energy startup, called Realta Fusion, that Khosla discovered at the University of Wisconsin-Madison. Khosla — which manages approximately $15 billion in assets with an average deal size of around $50 million, according to the venture website PitchBook — had been eyeing investments into fusion energy companies and helped Realta spin out from the university, leading the Wisconsin startup's seed funding round in spring 2023.
"It doesn't matter to us where the company is," Brooks said. "We're really just looking for an interesting breakthrough [and a] really good team."
Brooks returned to New Mexico late last year for the inaugural Roadrunner Technology Forum hosted by Albuquerque-based Roadrunner Ventures Studios in December. She was back in the state this year for Roadrunner's second tech forum event, hosted in Downtown Albuquerque in early September.
While Spiritus is Khosla's only New Mexico investment to date, Brooks said she met with "a bunch of companies" while in the state for Roadrunner's technology forum and for a separate Startup Forum event hosted by New Mexico State University's Arrowhead Center the same week. The venture firm also has other partners in the state "pretty frequently," she added.
That could be in part because Khosla, in November 2023, landed a $75 million commitment from the New Mexico State Investment Council, the state's sovereign wealth fund that takes a portion of Severance Tax dollars and invests them in venture firms through a private equity program, with the promise of those firms making investments in the state.
Ahead of Roadrunner's September technology forum, New Mexico Inno sat down with Brooks to hear more about her particular investment focuses, what she thinks Khosla brings to New Mexico's tech and venture ecosystem and the potential for future investments in the state.
This interview was edited for brevity and clarity.
New Mexico Inno: What have you seen, in your experience here, that compares New Mexico to other markets you and Khosla have invested in?
Alice Brooks: A big part of our strategy is to invest in companies that are bold and very early and with a strong technical differentiation and background. The pattern here totally fits that. You guys have really strong national labs here, and universities, so it just feels like there's a big concentration of researchers working on really cool things, which is exactly what we look for. Building up relationships here and meeting as many people as possible, and understanding what they're working on, that's the goal.
What are your investment focuses?
I spend time in deep tech and sustainability. I spend a bunch of time on the climate side and energy generation — fusion is one area — and food and agriculture, whether that's novel ingredients or farm systems. Manufacturing is another big interest area for me. My background is in mechanical engineering. I love understanding how products are made and how we can make supply chains more efficient, too, and bring the production of certain things as close to the end user as possible.
Does Khosla have specific geographic focus areas?
We're global, but since we're U.S.-based most of our investments are in the U.S. Since we're California-based, there's a large percentage there, but we are definitely very spread out across the U.S.
Once we do an investment in an area, our hope then is to do multiple startups there, because then you start seeing the ecosystem. And here it's great. There's a big ecosystem building up. Once you see an example of a company that is doing well, that inspires more people to jump into entrepreneurship and build an ecosystem around it.
Can you paint a picture of what it looks like when you're scouting for investments super early on? I'm sure that's harder than if you're a Series B or a Series C investor, where the technology has already been proven out and the startup has customers and more traction.
That's sort of the fun of this job. At Los Alamos [National Laboratory], or other early-stage places, it's really meeting the people that are working on these ideas — meeting the researchers, meeting the people that are thinking about potentially commercializing that [technology].
What we're looking for is, what is the breakthrough or what is the differentiation there? And it doesn't have to be totally de-risked yet. What is the idea? What is the approach? How is that different from other ways of how we've seen it being approached?
If we move further with a company, we can help them build the commercial team. What we want to see is, is there something unique with the tech, and is there the best technical team around it? If it's not fully proven out yet — which usually it's not at this stage, that's asking a lot — what is their plan, how are they ranking what the core scientific risks are and how are they addressing them? And what funding does it take to get there?
We're set up in a way that we invest across stages, too. We have a seed fund, our main fund which is for [Series] A and B, and then we have our growth fund. We can invest very early and then continue to invest in companies.
One thing I've heard from people in and outside New Mexico is that there are not a lot of seasoned, experienced entrepreneurs in the state. Is that a concern you have in making investments here — that you're going to put money in and then there's a lack of know-how to see companies succeed and return those investments?
Not really, because that's where we feel like we can be of assistance. If there's a really fantastic founder, we can help them with starting a company and learning how to do that, and bringing in help, too.
The more people you have starting companies, the more people learn from each other. I had that experience. I started a company when I was in [graduate] school, and I was part of an incubator accelerator. Just being around the other companies that were not in the same space as me, most of them first-time founders with a few repeat founders, and learning from them was super, super helpful.
