Indian-American entrepreneur and CEO Nitin Khanna is the personification of the American Dream. The son of an Army officer and a homemaker mother, Nitin Khanna arrived in the United States penniless at the age of 17. To stay afloat, he borrowed $400 from the International Students Office at the University of Southern California, which was later repaid by his aunt in Chicago. After completing his master’s degree in engineering at Purdue University, Khanna went on to work for International Paper and Oracle. In 1997, Khanna left Oracle and in partnership with his brother Karan, launched his first company, Saber Software, which was later headquartered in Portland, Oregon.
Though Saber Software was initially founded as a custom software development company, the 2000 United States Presidential election debacle marked a turning point for the firm. Following the election, the federal government passed the Help America Vote Act (HAVA) which mandated that each state modernize election equipment and adopt a computerized Statewide Voter Registration System. Saber was awarded the first state contract in Oregon and eventually expanded nationwide. Saber’s software is still used by over 25 states to manage elections. Khanna focused on growing the company aggressively and received private equity money from a fund created by Accel and KKR in 2007. Later that year, Khanna sold Saber for $473 million.
Following the sale of Saber, Khanna took a two-year sabbatical and concentrated on making early stage investments in Portland-based companies. Khanna and his brother founded MergerTech, an investment bank focused primarily on mobile software businesses. In 2014, MergerTech dominated the league tables nationwide for the most deals completed in the mobile space.
Always a visionary, Khanna was one of the first entrepreneurs to spot the massive potential, along with the massive risk, in the cannabis industry. In 2015, he launched his first cannabis company, Cura, and acquired another company, Select, during the following year. With Select as its brand, Cura went on to become the largest cannabis company in the world by revenue from 2016-2018. The cannabis industry was shocked. Industry leaders had anticipated that the market would be cornered by large Canadian companies that were early to the space. In a massive all-stock deal, Khanna sold Cura to Curaleaf for $950 million.
Khanna’s present venture is Sentia Wellness, a 21st century wellness company rooted in CBD. A unicorn from its outset, Sentia was valued at $1.45 billion, with Khanna raising $90 million based on that valuation. Sentia, with its brand Social CBD, is now one of the largest CBD companies in the world today and is on track to become the largest CBD company in the space.
As a result of his hard work, vision and creativity, Khanna has found extraordinary success across a range of industries. We had the opportunity to conduct an interview with Khanna, in which he discussed his approach to entrepreneurship, shared his advice for aspiring entrepreneurs, explained the impact of diverse hiring and shared how he has given back to the Oregon community.
Q: Tell me about your approach to entrepreneurship and why has it been successful?
NK: Entrepreneurship has been in my blood since birth. Some of my earliest memories, like a 5 or 6 year-old, are of being awakened at 4 a.m. by my uncles, bundled up, put in a car, and then we would drive all over the Indian state of Punjab to collect the money owed to my family from brick kilns, to whom we sold coal and lumber. During the entire long day, I would sit in the back seat, listening to my uncles talk nonstop about business. They discussed the value of cash, negotiations on price and collections, hunkering down during difficult times, growth and expansion, as well as the value of great employees and treating them right. I learned about business organically in the back seat of a car during innumerable rides that began at 5 a.m. and ended at 5 p.m. That kind of early education and experience is hard to come by and formed so much of the basis of my success in later years.
Q: Given your tremendous success, what advice do you have for someone who is looking to start a business?
NK: Advice is a difficult thing. The first advice that I would give an entrepreneur is to always take advice with a grain of salt. Often people give advice exclusively from their own experience rather than learning about the very specific issues that a founder is going through and then giving advice tailored to that situation. On the flip side, mentors need to find founders who are truly willing to listen and act on appropriate and vetted advice. Sometimes that can be very hard to find as well. But when there is a great founder-mentor fit, the results in the business can be exponential. I would recommend anyone looking for the value of good advice and advisors to read the book Trillion Dollar Coach by Bill Campbell. The other books I would recommend are Winning By Jack Welch, Influence by Robert Cialdini, Selling the Invisible by Harry Beckwith, and Execution by Ram Charan & Larry Bossidy.
The other significant advice that I would give a founder is to make sure they are really cut out for the extreme difficulties of owning a business, especially in the business’s early years. There is such mythology around starting a business these days. From incubators to accelerators to mentors to pitch competitions, it seems that the advice that people are getting is that anyone can start a business and everyone should do it. That cannot be more wrong. I have seen so many incomes and lives destroyed by people blindly believing that starting a company is the only worthy pursuit and that they are the right ones to do it. It’s like saying anyone can play in the NBA or run a 10-second 100m dash. It’s not true. Entrepreneurs should vet their own personality, experience, and education carefully, focus on execution over ideas, be comfortable managing people, and ensure a product/market fit before jumping into the deep end.
Q: How have you supported other businesses and mentored other aspiring entrepreneurs?
NK: Over the past decade, I have invested in over 30 companies and mentored over a dozen CEOs, often all the way to an exit. My focus has entirely been on supporting and uplifting the Portland startup community. I am usually the first investor for a company and founders can use my contribution to raise additional money. I invest primarily based on my confidence in the founder and not the idea, because as we all know companies pivot and change often before finding their groove. I have created support programs for entrepreneurs like the Portland 100 initiative which is an attempt to get companies to $100 million in revenue or an exit of $100 million. We match founders in Portland up with VCs from the Bay Area as well as mentors who have grown companies to over $100 million in their industries. The results can be fantastic. Also, I started MergerTech as a result of a request from founders I was mentoring, to help small tech companies have access to high-level investment banking.
Q: Tell me about how you have emphasized diversity in your hiring and why that was important to you? How has that contributed to your success?
NK: Excellence comes first. Diversity in thought, background, and experience is critical to excellence. In all of my companies, I have ensured that we have diversity and that everyone knows that they have a seat at the table and they are free to offer their thoughts and opinions and they will be listened to with respect. My brother and I developed a specific technique to foster this diversity of thought. During any meeting that we had with our team, he would take one end of an issue and I would take the opposite side. That made everyone feel comfortable that they could fall anywhere on the spectrum and would be heard. Often, generating this diversity in thought meant that we need that diversity to come from a person’s unique experience which is why it was important to have people from all walks of life, color, gender, and so on as part of the team and as part of the team from early on.
In male-dominated industries from software to finance to cannabis, I have always ensured that our executive teams had diverse makeup. At Cura, 50% of the management team is comprised of women or people of color from day one. We were the first large company in cannabis to accomplish this. We were also the first company in the cannabis industry to provide for a $14 per hour minimum wage and to offer health care benefits to all full-time and part-time employees. We were named the Fastest Growing Company in Oregon’s history and the Top 10 Most Admired Employer in the same year! That shows that this focus on people and diversity pays off.
Q: You are a philanthropist as well. Tell me about what you have done for the community of Oregon? What charities have you been involved with and why did you get involved with those charities specifically?
NK: I would hesitate to call myself a philanthropist. Yet, I have been involved in the creation and support of charitable endeavors that are meaningful to me. The primary charity that I support is called Feeding Kids in My Backyard. We have provided 25% of the budget for this charity for the past several years. The charity ensures that kids who get free lunches at school also have meals at other times in the day. Kids don’t just need lunch, they also need breakfast, dinner and meals on the weekends. This charity provides that. We support it with money, but also with our employees’ time and provide it space in which to operate when needed.
To further demonstrate my support for diversity, I was one of the founding contributors to The Initiative. The Initiative is an accelerator program, business bootcamp and funding resource for female-founded cannabis businesses. We have dedicated our employees’ time to this effort and I continue to be an advisor to the fantastic ladies who run this program.
The third important charitable endeavor that I have undertaken involved providing the vision and the initial funding for the Possible Plan. At Cura, we saw that our success was not possible without the contributions of those that came before us. Unfortunately, so many of those who came before us were incarcerated for low-level nonviolent marijuana crimes. We wanted to right that wrong. This led us to create the Possible Plan and fund it with $500,000. We are still the primary supporter of that plan. It began as an idea inside Cura and I am very proud to say it’s now an independent 503c charity. We recruited Former Special Assistant to President Obama and Director of Public Engagement for Vice President Biden Carri Twigg to run it.
In the past, I was on the board of the Classic Wine Auction, a charity that raises $3 million a year to support six charities, all of which benefit children. We continue to look for opportunities to help kids of all ages with many different issues from hunger to skills development to shelter.