Bessemer Taps Two To Aid Portfolio Cos. –

MENLO PARK, Calif.- Looking to provide its portfolio companies with the kind of market-wise wisdom that only comes from experience, Bessemer Venture Partners hired Tom Berger and Chris Risley as the firm’s first ever operating partners. BVP announced the additions at the end of July.

Berger and Risley’s main responsibility will be to work with the firm’s existing portfolio companies, while acting as mentors to its new chief executive officers, Risley said. “We will work with portfolio company CEOs to make sure they are dealing with all the new challenges in today’s market. We are trying to guarantee the best outcome for each company,” he added.

The 55 year-old Berger joked that his main qualifications for the job lay in the fact that he has a lot of gray hairs and has made a significant number of mistakes during the course of his business career. “So now I can help these companies make new mistakes, not the mistakes I made,” he said.

BVP decided to bring the two operating partners on board because the firm sensed the need to get a better understanding of the operational issues affecting its companies and how those issues could be addressed, Berger noted. Bringing on professionals to simply focus on portfolio companies did not indicate any degree of turmoil within the firm’s portfolio, he added. “There has been such an explosive growth in the number of new start-ups over the last few years, but just a finite amount of talent for CEO jobs. So it is a matter of limited talent, not a feeling that any of these companies need to be fixed,” he said, adding “I don’t want to be a CEO again, but I can share some of my knowledge.” Neither David Cowan or Rob Soni, BVP’s two managing general partners, were available for comment.

One of the challenges facing the two operating partners at the firm’s portfolio companies will be balancing an effective corporate structure with entrepreneurial spirit, Berger said. “One of the big issues facing venture-backed companies is organizational structure. The things that worked when a company was six to eight employees don’t work when it has grown to 20 or 30 employees, much less 150 or 200 employees. So they need help,” he noted. “I tell young companies What got you here, won’t get you there.'”

Companies in the process of transitioning from one stage of their development to the next also need guidance on what works and when, Berger said. First year telecom or information technology companies should spend their whole first year focusing on engineering issues, but mature companies must be market focused, he noted. “The key equation to solve is when to make these transitions and I can help them do it better, because I have been through the wars. I’ve just seen a lot,” he noted.

Both men have experience with CEO consulting/coaching and established relationships with BVP. Risley has been an entrepreneur-in-residence at Bessemer, as well as CEO of two Bessemer portfolio companies. Most recently, he worked at Redwood City, Calif.-based NewChannel Inc. “I replaced the original CEO at NewChannel, who then became the chief operating officer. We worked together and then he became the CEO again. There was something quite satisfying about that process to me,” he added.

Berger spent the last 15 months doing independent consulting for Bessemer portfolio companies Reefedge Inc., Envoy Networks Inc. and Taqua Systems Inc., where he was interim chief operating officer as the company conducted a CEO search. Prior to that he was CEO at one BVP portfolio company and president of another.

Risley will work out of BVP’s Menlo Park office, while Berger will be based in the firm’s Wellesley Hills, Mass. office. Berger will be joined in BVP’s Menlo Park office by Jerry Baker, most recently CEO of Network Computer Inc. and a former senior vice-president of Oracle Corp. Baker joined BVP as a special limited partner and will evaluate deals and advise the firms partners on a part-time basis, Risley said.