Jeffrey Katzenberg, film producer, at the Allen & Company Sun Valley Conference on July 06, 2022 in Sun Valley, Idaho.
David A. Grogan | CNBC
Media mogul Jeffrey Katzenberg is bullish on technology as he pulls in more money for startup investing. But he’s keeping his venture portfolio clear of digital media.
Katzenberg, who three years ago had to contend with the the high-profile failure of short-form entertainment company Quibi, has just raised $460 million for investment firm WndrCo, which he started with former Dropbox finance chief Sujay Jaswa.
WndrCo started as a holding company in 2016 with capital from private investors. Since then, the firm has grown to manage $1.5 billion, investing in companies across technology, including Dapper, Databricks, Gemini, and Robinhood. The firm has also built out businesses like digital protection companies Aura and Twingate.
Quibi, which Katzenberg founded in 2018, shut down in 2020, just over six months after launching, despite having raised $1.75 billion from investors including Disney, Comcast’s NBCUniversal and AT&T’s WarnerMedia. The service counted only 500,000 subscribers six months after debuting following a projection it would have more than 7 million subscribers within a year.
Katzenberg previously was co-founder of DreamWorks and served as chair of Walt Disney Studios.
Now at WndrCo, Katzenberg is steering clear of the media market, telling CNBC that the big platforms are the winners. Rather, the firm is seeking opportunities in cybersecurity, the future of work and consumer technology.
Jaswa said the goal is to find up to seven venture investments and to build one or two companies each year. Katzenberg joked about his own imaginings for the portfolio: “the moon, the stars,” he said. Longer term, he said he hopes the companies the firm backs turn into “not just a great investment but actually made the world a better place.”
WndrCo has invested in low-code platform Airtable and payroll and compliance company Deel.
At Twingate, WndrCo is betting on a virtual private network (VPN) replacement. The company was founded by a WndrCo partner and is also backed by Joe Lonsdale’s 8VC. Identity theft protection company Pango is another cybersecurity business backed and built by WndrCo. Jaswa, who serves as chair of Pango, said the reason for those investments is that so much of tech innovation has come without guardrails.
“All sorts of amazing things happened,” Jaswa said. “And yet the other half of it, which is protecting people online, nobody did anything in that dimension.”
Katzenberg and Jaswa are waiting for guardrails in artificial intelligence, as well. Katzenberg said there’s a price for technological advancements like the internet and now AI.
“People are anxious about” what the price will be with AI, Katzenberg said. “We don’t know. So caution seems appropriate.”
Still, Jaswa is optimistic.
“Major advances in technology are often catalyzed by humans not wanting to do something that we have to do,” he said.
Disclosure: NBCUniversal is the parent company of CNBC.