advertise as being "approved by Zuckerberg." What does Makan ask for in return? Opportunities for his clients to invest alongside Zell and Li in their deal flows.Īs a registered investment advisor Makan has a fiduciary duty to "not engage in any activity in conflict with the interest of any client." But unlike your average Merrill broker, who faces a gauntlet of compliance hurdles on every product mentioned, Iconiq deals practically advertise their dizzying array of conflicts of interest. Through Iconiq they have gained access to startups that Makan & Co. Billionaire moguls like Sam Zell and Li Ka-shing have massive real estate portfolios but no direct link to the Silicon Valley in-crowd. While Makan and his team sell entrepreneurs on access to its famous clients, they sell other connections on getting in on the ground floor of hot startups. "They just want to connect and network and give more access." He and his wife recently flew in to San Francisco from their home in Salt Lake City for a quarterly Iconiq networking event "where all the magic happens." "They don't want operational involvement," says Skonnard. "They can probably connect to anyone in the world."Īaron Skonnard, cofounder of e-learning startup Pluralsight, received a similar "join Silicon Valley's inner circle" pitch from Makan before Iconiq participated in the firm's $135 million Series B round. "When someone like Iconiq wants to invest, you can't say no," says Thomas. Before Iconiq led a $40 million Series D round last May for social media software firm Sprinklr, Makan invited founder Ragy Thomas to dinner with three famous billionaires. Key to Makan's pitch is bowling over wannabe Zuckerbergs with raw star power. The firm claims only 100 family office clients, but regulatory forms report some 300 investors, who put pre-IPO money into such companies as Alibaba and India's e-commerce giant Flipkart. The centerpiece of this action is Iconiq's $500 million Strategic Partners fund, Makan's flagship among 39 private investment vehicles, which total about $1 billion. While Silicon Valley stalwarts like Sequoia and Benchmark can point to a long list of successful IPOs and a deep bench of management experts, he hawks the "Zuck & Friends" brand to piece together deals between young startup entrepreneurs and billionaire sugar daddies, as well as between the billionaires themselves. Makan's currency is access and relevance. He sees himself instead as part do-it-all financial consigliere, part deal broker/venture capitalist and part human Rolodex. Indeed Makan shuns the title of wealth manager, according to those who have worked with him. He is a throwback to the early days of Wall Street, when dealmakers like Goldman Sachs' Sidney Weinberg blurred the lines between business and pleasure and turned the art of schmoozing into a powerful and profitable investment banking network. Makan's wealth management approach flies in the face of widely accepted post-Madoff best practices for advisors, which preach strict adherence to corporate protocols and regulatory rules. His board of directors is another power list, with nontech titans like Henry Kravis and David Bonderman, Chase Coleman and steel tycoon Lakshmi Mittal's son Aditya. Yet Iconiq's advisory services represent only one thread of the dealmaking web Makan has woven thanks to the abundance of Zuckerberg cronies on his client roster, including Facebook's Dustin Moskovitz and Sheryl Sandberg, Twitter' s Jack Dorsey and LinkedIn' s Reid Hoffman. Already it has full discretion over $1.4 billion in client funds and advises on another $7.6 billion. Working his way into Zuckerberg's inner circle when Facebook was still in diapers has proved to be a gold mine for Iconiq.
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