Can innovation thrive outside the traditional tech epicenters like Silicon Valley?
Aziz Gilani, General Partner at Mercury, believes not only can it thrive — it can flourish. From Houston to Austin and beyond, Aziz shares how Middle America is becoming home to billion-dollar enterprise software companies with staying power.
In this episode of Driving Alpha, host Steve Brotman dives into Aziz’s journey from early tech jobs at Lotus and Infosys to helping Mercury scale its portfolio to over $9 billion in enterprise value. They unpack what makes a startup fundable, the “spike” he looks for in founders, and the market conditions that signal a billion-dollar opportunity. Aziz also explores why regulatory challenges require proactive VC leadership and why emerging tech like AI and quantum computing are reshaping what’s possible.
As a former national policy advisor, Rice University lecturer, and repeat backer of unicorn-chasing startups, Aziz brings unmatched insight into what it takes to scale innovation outside coastal cities. Whether you’re an investor, founder, or policy-maker, this episode offers a deep dive into how to build next-gen tech hubs in unexpected places.
TRANSCRIPT
Steve Brotman: Hi, this is Steve Brotman, the founding and managing partner of Alpha Partners, and we’re bringing to you today, Driving Alpha. Joining us is Aziz Gilani, the general partner at Mercury Fund, the $160 million venture powerhouse backing software innovators like RepeatMD, which revolutionizes healthcare tech and FinTech, and Brassica. This Texas-born deal maker has engineered exits like Black Lotus and Modus with his partners while propelling Mercury’s portfolio to over $9 billion in enterprise value. A Kauffman Fellow who literally wrote the playbook on seed accelerators, Aziz now shapes national innovation policy through his Commerce Department appointment, which he recently left at the end of last year. When he’s not teaching future founders at Rice University or advising Black Founders Matter Fund, you’ll find him hunting the next unicorn in cloud tech and AI with recent wins like cybersecurity standout BlueMyra and VR fleet maestro ArborXR. Strap in or crack it open — the playbook of a VC who turned Middle America into a billion-dollar innovation corridor. Welcome, Aziz.
Aziz Gilani: Thank you, Steve. Let me just say we’ve known each other for many years and I admire what you guys do at Alpha Partners every day.
Steve Brotman: Thank you for saying so. We’re super excited to be a partner of yours. So, how the hell did you end up being a VC? Was it a complete accident or was it something purposeful?
Aziz Gilani: I kind of grew up in the enterprise software industry. I had that proverbial origin story — in high school, I would ride my bicycle to a software startup working with NASA contracts in Houston. I got my first job at Lotus Development Corp., the company behind spreadsheets and email. I then cycled through a few places. I like to joke that I failed at every point in the enterprise software stack — from Lotus to Ernst and Young doing complex software implementations, to ABB where I led software procurement, and Infosys doing offshore development and customization. So I got a broad view of enterprise software — development, sales, and implementation. When I applied to business school, I got a phone call from Matt McCall, then running Portage Ventures and also an advisor to Kellogg School of Management. On the admission call, he said, “Aziz, your background seems suited for venture capital — ever thought about it?” That was my introduction to the industry, and I’ve been a VC ever since.
Steve Brotman: Wow. Matt and I worked together at Pritzker Group for many years. I can see the connection there — amazing. So born and raised in Texas?
Aziz Gilani: I was born in Midland, Texas, but Houston is home. It’s where I’ve lived the longest and where my family is.
Steve Brotman: So, logically, Houston and venture capital — was it just natural to stay planted?
Aziz Gilani: You play to the strengths of the market you’re in. At one point, Microsoft had the largest concentration of enterprise software licenses in Houston. Houston is home to the energy industry and many Fortune 500 companies — second only to New York. So, if you’re in enterprise software, Houston is an ideal place to find early customers.
Steve Brotman: Reminds me of New York — lots of folks at the application layer, capital availability, and risk takers. How’s the angel investment community evolved in Texas?
Aziz Gilani: Across Texas, we’ve seen radical progress. Austin’s angel and seed community has blossomed. In Houston, we’ve seen great strides, especially with Rice University’s Ion, now a center for entrepreneurship. Like all of America, Texas has embraced startup culture, recognizing innovation is key to growth and standard of living.
Steve Brotman: So, as a VC, what sort of things do you look for in the entrepreneurs you back?
Aziz Gilani: Every startup and entrepreneur is a little different, but I’m always looking for a “spike”—something they’re the best in the world at. It might be domain expertise, tenacity, customer obsession, or sales ability. That special something—the unfair advantage to win—is crucial because starting a company is incredibly hard. The math says it shouldn’t work. That spike helps defy the odds.
Steve Brotman: Want to highlight an example of that spike in an entrepreneur you’ve backed?
Aziz Gilani: You mentioned RepeatMD earlier—Phil Sitter is a great example. A third-generation entrepreneur whose father was a restaurateur—one of the hardest businesses out there. Phil grew up with that tenacity. His company had to pivot hard from its original model, but he stayed laser-focused on finding the right customers and adapting to their needs. That grit and customer insight made me want to back him.
Steve Brotman: Opportunity matters too. What kinds of ideas or markets are you drawn to right now?
Aziz Gilani: First, I want to see a massive market with a massive total addressable market (TAM) that’s growing. Then, I want to know the piece you’re initially targeting is also big and that you have an unfair advantage to win in that segment—whether it’s your team, product, or go-to-market approach. Only after I check those three boxes do I dive into execution details.
Steve Brotman: What do you wish you knew at the start of your VC career?
Aziz Gilani: First, I had no idea how big the industry would get. In 2008, it was tiny—just a few hundred people, everyone knew everyone. Now, we’re 14x larger. Second, I understood tech shifts conceptually, but not the speed and magnitude. The sharing economy, cloud, and smartphones changed everything. Finally, I didn’t realize how much of a people business this is. Even as it scales, venture is still about relationships and trust.
Steve Brotman: What’s the implication of those three realizations?
Aziz Gilani: That we work in a hyperconnected industry where reputation really matters. It’s a meritocracy with huge upside when you get it right. It’s about finding smart bets, collaborating, and winning together. That’s why you see VCs everywhere — podcasts, social media — sharing what they know and staying plugged in.
Steve Brotman: Switching gears — let’s talk regulations. How do you see them affecting the space?
Aziz Gilani: We have an outsized impact on the economy, but we’re still a tiny sliver — just a few thousand people in hundreds of firms. So we often get caught up in regulations not meant for us: rules for public companies or big private equity firms trickle down to us and our startups. That’s a challenge we constantly navigate.
Steve Brotman: With the changing administration, are you optimistic or pessimistic?
Aziz Gilani: I’m a VC — we’re unrepentant optimists. I see opportunity. The SEC, for example, is looking to improve capital formation. The FTC may help ease M&A slowdowns. There’s talk about easing IPO hurdles. And for Web3, we might finally get clear regulatory frameworks instead of enforcement by surprise.
Steve Brotman: What’s your take on the carried interest debate?
Aziz Gilani: Venture capital has grown because we leveled the tax playing field versus other asset classes. Real estate has tons of tax advantages. So when we improved the startup investment landscape, it led to innovation booms — cloud, AI, mobile. We’re now seeing proposals that would double tax us. That risks turning off the very innovation engine that makes the U.S. a global leader.
Steve Brotman: With Europe flatlining and us pulling ahead economically — it shows smart policy matters.
Aziz Gilani: Exactly. When bipartisan majorities passed the JOBS Act and other innovation-forward policies, we supercharged growth. We can’t take that for granted or pull the plug now. We need to double down.
Steve Brotman: Let’s look ahead. What sectors excite you?
Aziz Gilani: AI is huge — every product, every workflow is being reimagined. I’m also excited by quantum and robotics. And customer behavior is shifting—people want personalized everything, and tech lets us deliver that. So much opportunity there.
Steve Brotman: Any quantum or robotics bets yet?
Aziz Gilani: Not directly, but I’m deep in the weeds. I’m especially watching quantum’s impact on cybersecurity. I’ll be at RSA, DEF CON, and Black Hat this year — very eager to find strong teams in those areas.
Steve Brotman: Best way for entrepreneurs to get in touch?
Aziz Gilani: I try to be super accessible. My email’s on our site. I’m on LinkedIn and social as @texasvc. We also have an intake form on our website. If you can’t reach a VC, they’re not doing their job.
Steve Brotman: And for LPs — what fund are you on?
Aziz Gilani: Mercury Fund V. We’re actively deploying, and we’re laser-focused on exits and liquidity for LPs. We’re not raising right now, but we’ll likely be back in the market next year.
Steve Brotman: Geographic focus?
Aziz Gilani: We have roots in Houston, Austin, and Ann Arbor. We love capital-efficient companies, channel-led go-to-market strategies, and founders who want to go slow to grow fast. We’re a great fit for founders outside the coastal playbook.
Steve Brotman: Aziz, this was fantastic. Thanks for being here — your optimism and clarity really shine through.
Aziz Gilani: Thanks, Steve. A pleasure to be here.