Former Intel VP Turned VC on Investment Opportunities (STP, INTC)

Includes: INTC, STP

Former Intel Capital VP Claude Leglise recently joined San Francisco-based venture capital firm WI Harper. He will be focused on investments in Greater China. Here are key extracts from an interview Leglise conducted with Red Herring:

On China:

The picture that grew out of these last few years at Intel was that the economic activity for the next 10 or 20 years will be in Asia, and specifically in China. This is based on watching the portfolio companies, and watching Intel customers like Huawei and Lenovo just doing wonderful things and coming out of essentially nowhere. I met Huawei in 1995, when nobody knew who they were. Now they have their own freeway exit.

I am particularly keen on companies that are targeting Chinese domestic consumption. American companies that use China as a low-cost source of goods or services—that’s a viable investment strategy. But the part that’s really fascinating is domestic consumption.

On Investment Opportunities:

I’ve always thought there are four opportunities at the moment. Semiconductors—there will continue to be some good ideas around there. Two is the whole wireless ecosystem. We’re talking about 500 million subscribers by the end of 2007. That is bound to lead to more innovations on the services side. Three is digital media. And four is the ‘wow, I hadn’t thought about that.’ This worked well at Intel, and I think it’s going to work at Harper. It’s the guy who walks in the door, and he describes this new thing, and you go ‘wow, it doesn’t fit in any strategy we have, we’ve never thought about this, but it sounds really compelling.’

Comment: When asked about energy (the biggest IPO on Nasdaq in 2005 was Suntech Power (ticker: STP), a Chinese solar cell company) Leglise replied: "Beware the fad."