Latest / Trailblazers by Erica Wenger / Jeff Clavier: How To Raise Your First Fund l Trailblazers Podcast Episode 53

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Jeff Clavier: How To Raise Your First Fund l Trailblazers Podcast Episode 53 · Trailblazers by Erica Wenger

0:00
[SPEAKER_00]: Say on the show, I am so excited to be joined by Jeff Klavier.
0:03
[SPEAKER_00]: Jeff is the founding partner of Unport Capital.
0:06
[SPEAKER_00]: The seed stage venture firm he launched in 2004, back when it was called SoftTechVC, and the idea of a dedicated seed fund was still a novel one.
0:14
[SPEAKER_00]: For more than two decades, he's parted with founders from their very first days.
0:18
[SPEAKER_00]: And over that time, the Unport team has backed more than 280 startups, including Fitbit, Sandgrid, Postmates, Mint, Eventbrite and Poshmer.
0:27
[SPEAKER_00]: Today, he supports companies like Drone Deploy, Front, Shippo, Clastojo, Phil, and Caratfertility, and sits on the boards of Lock Orbital, Masari, and Scrib, User Jams, Overflow, Lumina, and Coups.
0:38
[SPEAKER_00]: Often, the first big check of founding team takes and the longest relationship they keep.
0:41
[SPEAKER_00]: Born at Raze and Educated in France.
0:43
[SPEAKER_00]: Jeff earned an MSN computer science and a degree in distributed computing from the University Paris Dicker.
0:49
[SPEAKER_00]: He began his career as a developer at the FinTech startup FX, rising to CTO before the company was acquired by routers, which brought him to Silicon Valley as a general partner at routers venture arm, and eventually out on his own to build on court.
1:01
[SPEAKER_00]: Let's welcome Jeff.
1:04
[SPEAKER_00]: Thanks for being here.
1:05
[SPEAKER_01]: Thank you so much for the very long welcome, America.
1:08
[SPEAKER_01]: Sorry you have a long career.
1:09
[SPEAKER_00]: I love it.
1:09
[SPEAKER_00]: You've been doing this for quite some time.
1:11
[SPEAKER_00]: You deserve it.
1:12
[SPEAKER_00]: You deserve to like relish in it.
1:13
[SPEAKER_00]: All those companies, 280, 300 actually.
1:16
[SPEAKER_01]: We haven't announced the most recent ones, but we just clocked 300 just a couple of days ago.
1:24
[SPEAKER_00]: How do you log them internally?
1:25
[SPEAKER_00]: Do you say like 300, 3001, 3001?
1:27
[SPEAKER_01]: So we have a running list of all the companies we've invested in and then each one gets a numerical number and when we get the companies together at over summits or different sort of organized meetings, we're organized, we give them sort of the original number on their badge and everyone looks always for the lowest number.
1:50
[SPEAKER_01]: And every now and then we have number one that
1:54
[SPEAKER_00]: Wow, who's number one?
1:55
[SPEAKER_00]: Who's the first to 11?
1:56
[SPEAKER_01]: It's a company called Truvio TRUVO, which was a video search engine pre-YouTube that invested in in early 2005.
2:07
[SPEAKER_00]: Wow, pre-YouTube, that's wild.
2:10
[SPEAKER_01]: And yes, so at the time you had to sort of search for, you know, the code that was playing the videos.
2:16
[SPEAKER_01]: got that, you know, on that website, you could search, and the company was acquired after 10 month and three weeks by AOL after a beating wall with Fox interactive.
2:28
[SPEAKER_00]: Not bad for your higher R. 10 months.
2:31
[SPEAKER_01]: That 10 month, 17x in less than a year, yes.
2:35
[SPEAKER_00]: Pretty epic.
2:35
[SPEAKER_01]: Those were the good days.
2:36
[SPEAKER_00]: Yeah, I know.
2:37
[SPEAKER_00]: Things have changed.
2:38
[SPEAKER_00]: Which we'll get into.
2:39
[SPEAKER_01]: And the company, you know, had an incredible evaluation of 2.5 million increase.
2:44
[SPEAKER_01]: It was expensive at the time.
2:46
[SPEAKER_00]: You know, we are going to get all into valuations because now it's just painful hearing some of these stories.
2:50
[SPEAKER_00]: I mean, I had Anne on at Flood Gate who I'm sure you know, one of the other, you know, OGs, Silicon Valley folks, and we were talking about her lift investment, and it's just like it's just painful, like just seeing how much it's grown.
3:01
[SPEAKER_00]: I mean, so happy for her, but painful can't really happen again, release it's harder to.
3:04
[SPEAKER_00]: Yeah.
3:05
[SPEAKER_00]: All right.
3:06
[SPEAKER_00]: So I want to ask you a little bit of an icebreaker question.
3:08
[SPEAKER_00]: Yes.
3:08
[SPEAKER_00]: All our guests is at the start.
3:10
[SPEAKER_00]: So, I obviously read an incredible bio 26 plus years in venture and even more in tech broadly, what has been the hardest part of your journey so far?
3:18
[SPEAKER_00]: When you reflect back on that whole time, what's the part that almost broke you?
3:24
[SPEAKER_01]: I think the hardest was when I tried to raise fund 3, which was in 2010.
3:32
[SPEAKER_01]: I had, you know, the first fund was my own capital.
3:36
[SPEAKER_01]: So we called that sort of TVC1.
3:37
[SPEAKER_01]: So it was one of the first...
3:41
[SPEAKER_01]: kind of seat funds in history that I raised in 2007, was 15 million, and I raised my first fund, like from institutional in eight weeks, which never happens, right?
3:53
[SPEAKER_01]: You talk to everyone, I was on a call with a new manager this morning, and it told her
4:00
[SPEAKER_01]: be ready for two years of hell to raise your first fund.
4:03
[SPEAKER_01]: And I just didn't need weeks.
4:06
[SPEAKER_01]: And so, I was like, well, you know, I'm good at this.
4:09
[SPEAKER_01]: And then I tried to raise a much larger fund, 50 million.
4:13
[SPEAKER_01]: I mean, now it's nothing, but back then it was something.
4:17
[SPEAKER_01]: And it took me almost two years to actually raise it.
4:20
[SPEAKER_01]: And I made all the stupid mistakes that the emerging manager sort of typically
4:27
[SPEAKER_01]: So I basically what happened is I lost my anchor LP the day we were supposed to do the first clothes like 10 million disappear and literally it was December 21st
4:43
[SPEAKER_01]: right?
4:43
[SPEAKER_01]: So it's like a bad, bad time to sort of lose your anchor LP.
4:47
[SPEAKER_01]: And thanks to my other remaining amazing LPs, we did actually close on 15 million as it was 25 for that first close, on December 22nd.
4:58
[SPEAKER_01]: So it didn't sleep over.
5:00
[SPEAKER_01]: My lawyers at Gondos and Dettmer did an amazing job, you know, sort of getting the documents ready.
5:06
[SPEAKER_01]: And we closed and what's interesting is that I had a call option to buy 1% of Fitbit for $270,000.
5:15
[SPEAKER_01]: That was expiring on December 31.
5:18
[SPEAKER_01]: So we did emergency, you know, capital call, I actually bought the Fitbit shares on December 30 or something.
5:26
[SPEAKER_01]: And many years later,
5:29
[SPEAKER_01]: That deal return to the entire fund.
5:31
[SPEAKER_00]: That one percent.
5:32
[SPEAKER_00]: That one percent.
5:33
[SPEAKER_00]: Wow.
5:34
[SPEAKER_00]: Because they got acquired by Google, obviously.
5:35
[SPEAKER_00]: Yeah.
5:36
[SPEAKER_01]: It was acquired.
5:36
[SPEAKER_01]: Well, it went public.
5:38
[SPEAKER_01]: It went public.
5:39
[SPEAKER_00]: What happened with Google?
5:40
[SPEAKER_01]: In 2015, Google sort of bought them much later.
5:43
[SPEAKER_01]: Oh, really?
5:44
[SPEAKER_01]: After like many years as a public company.
5:46
[SPEAKER_00]: Oh, so funny.
5:46
[SPEAKER_00]: I think of them as like having internet at Google.
5:48
[SPEAKER_00]: I didn't realize that they got involved.
5:50
[SPEAKER_01]: That was my first IPO in 2015.
5:52
[SPEAKER_01]: super epic wow that's awesome so that that almost broke me but there were many instances where you know it's as we see you have every nine days you know every and then a good day and you have a good outcome sell a company you know like you mentioned wrong deploy we actually announced there in their acquisition by Procore
6:21
[SPEAKER_01]: Otherwise, it's just hard, you just are, you know, working with founders who just leave the lives of founders and it's really, really hard.
6:31
[SPEAKER_01]: And, you know, sometimes it takes you at 10 pm on the Sunday night saying, hey, do you have a minute?
6:36
[SPEAKER_01]: It's never, ever to tell you being used, ever.
6:40
[SPEAKER_01]: So, you just deal with a bunch of shit on a daily basis and then everyone in then you have like a bit then.
6:45
[SPEAKER_00]: Yeah.
6:46
[SPEAKER_00]: it's what what's a ratio would you say between like the good days where there's a sale or there's a markup or there's something to the like hard sloggy days because I think there's no people misunderstand about being a founder.
6:55
[SPEAKER_00]: They think it's like half good, half bad.
6:58
[SPEAKER_01]: It is it is 3% good.
7:01
[SPEAKER_01]: It's not just 1% bad.
7:03
[SPEAKER_01]: Like yes, a mock-up is kind of a good news.
7:06
[SPEAKER_01]: Like we're happy that the company gets, you know, like a bit of capital and we get a new mark or whatever, but
7:13
[SPEAKER_01]: It means nothing, right?
7:14
[SPEAKER_01]: The only time when you can actually sort of crystallize for real, like a profit is when either you sell part of the company or you sell the company.
7:24
[SPEAKER_00]: Absolutely.
7:25
[SPEAKER_00]: Yeah, I mean, selling part of the company has also become more of like a recent thing, right?
7:28
[SPEAKER_00]: Secondary is a crazy these days.
7:29
[SPEAKER_01]: One thing I've learned talking to GPs on the show and in my own experience as a GP, your back office is a signal.
7:35
[SPEAKER_00]: How fast you close deals, how clean the LP experiences, how your K-1s land, and investors notice all of it.
7:42
[SPEAKER_00]: The more buttoned up you are, the more likely they are to give you more money in the future.
7:45
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7:47
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7:55
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8:01
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8:02
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8:07
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8:10
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8:12
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8:16
[SPEAKER_00]: I want to talk a little bit about that very first fund.
8:18
[SPEAKER_00]: Would you say it was your own capital?
8:19
[SPEAKER_01]: Yes.
8:20
[SPEAKER_00]: How big was that?
8:21
[SPEAKER_00]: And what made you decide to start a fund?
8:23
[SPEAKER_00]: I mean, people, it's probably so are people to comprehend.
8:26
[SPEAKER_00]: But like in 2004, that was not a thing.
8:28
[SPEAKER_00]: Like venture was so nascent and especially seed.
8:32
[SPEAKER_00]: Like there was capital and I would love to hear your thoughts.
8:34
[SPEAKER_00]: There was capital later on.
8:37
[SPEAKER_00]: Tell me more about that.
8:38
[SPEAKER_01]: So, yes, back in 2004, and 2003 is when I started sort of mowing over it.
8:46
[SPEAKER_01]: Essentially what happened is we saw the emergence of Web2O, Web2.0, as we call it.
8:52
[SPEAKER_01]: And what was interesting is that those companies were actually very capital efficient.
8:56
[SPEAKER_01]: The issue why seed wasn't possible, it went Web1O.
9:01
[SPEAKER_01]: is that you had to spend a million bucks on son hardware, a million bucks on Oracle licenses, a million bucks on whatever other sort of piece of software.
9:10
[SPEAKER_01]: And so you need it like millions of dollars to just get going, right?
9:15
[SPEAKER_01]: Next generation starts leveraging some of the advances in, like, okay, well, you don't need to, you can actually rent servers, you don't need to run your own, you know, sort of OS or whatever.
9:27
[SPEAKER_01]: And so the capital requirements of those companies were much slower.
9:31
[SPEAKER_01]: And at the end of the day, what was happening is that I saw entrepreneurs were looking for like a few hundred thousand dollars and a lot of help.
9:40
[SPEAKER_01]: And there was nothing in venture that did that.
9:42
[SPEAKER_01]: You had angels that were writing small checks and doing pretty much nothing, except a few like one con way.
9:49
[SPEAKER_01]: And you had VC funds that were writing series HX at the time that were like $23 million.
9:56
[SPEAKER_01]: And so if you were just looking for, say, 2015, there was nothing.
10:00
[SPEAKER_01]: Right?
10:00
[SPEAKER_01]: There was a clear sort of need in the market, and there was a hole.
10:04
[SPEAKER_01]: And so after four years as a GP at Royitos Win Hassan,
10:09
[SPEAKER_01]: I thought this is kind of interesting.
10:13
[SPEAKER_01]: I maybe should do that.
10:15
[SPEAKER_01]: And I was very grateful to my partners at the fund because they basically told me what being a VC meant because literally I had never met a VC in my life until I decided to become one.
10:29
[SPEAKER_01]: And basically, say, look, no one is ever going to back me as a GP because I don't have a track record.
10:37
[SPEAKER_01]: And I don't even know whether it works.
10:39
[SPEAKER_01]: And so I went to my number one G, you know, LP, which was my wife, and I said, hey, how about I stop this job?
10:47
[SPEAKER_01]: And so I stopped making money and I actually tapped into a word hard on savings.
10:51
[SPEAKER_01]: We had made a little bit of cash when we sold a fixed two on to writers.
10:56
[SPEAKER_01]: And you know, I'm gonna take 250k or savings and I'm going to invest us in startups and we'll see whether it works.
11:03
[SPEAKER_01]: And she looked at me and she was like, okay, whatever.
11:08
[SPEAKER_01]: Just don't bankrupt us.
11:09
[SPEAKER_01]: And so the first kind of budget was 250K.
11:14
[SPEAKER_01]: We extended that to double that.
11:17
[SPEAKER_01]: What was interesting is, I mean, we talked about truvio.
11:21
[SPEAKER_01]: Because of that, you know, conversion from Web1O to Web2O.
11:27
[SPEAKER_01]: a lot of web-tool companies sort of got acquired very, very quickly, like within within month.
11:34
[SPEAKER_00]: Kind of like now actually it's happening.
11:36
[SPEAKER_01]: Like now, it's actually about, yeah, yeah.
11:39
[SPEAKER_01]: And it was kind of interesting that people were almost telling us that we're building those companies to flip them, right?
11:46
[SPEAKER_01]: The term, built to flip was used at the time, and that will lead me to be all the track
11:57
[SPEAKER_01]: three years, I was 5xDPI, which means that I had returned my original investment overall five times, right, which never happens.
12:07
[SPEAKER_01]: And that's that track record that owed me then to raise an institutional fund, because I could point to not only the strategy working, but the financials actually working, right?
12:20
[SPEAKER_01]: Obviously, I never got to 5xDPI in three years ever again,
12:28
[SPEAKER_01]: But I just thought that this was to get an opportunity to pass on in, you know, Mike Maples and Josh Coppola and all the OGs sort of sort of same, and we kind of started around the same time, 2004 or five, six.
12:46
[SPEAKER_01]: And then in 2007, I became sort of institutional, kind of GP,
12:55
[SPEAKER_00]: Yeah, it's a 5x CPI is unheard of.
12:58
[SPEAKER_00]: And I have this theory, I'd love to get your take.
13:01
[SPEAKER_00]: That a lot of the best fund managers of this time, like let's point to like a Josh Kushner or like, even like Alex Sohainin's doing some cool stuff.
13:08
[SPEAKER_00]: Chris Sohka is obviously such a legend.
13:10
[SPEAKER_00]: Founders fund early funds.
13:12
[SPEAKER_00]: They do well because that first fund has crazy DPI.
13:16
[SPEAKER_00]: And I feel like that is something that we don't talk about enough in our business is like, how do you optimize for DPI early and smaller funds early?
13:23
[SPEAKER_00]: Because therefore you can get more DPI.
13:26
[SPEAKER_00]: What's your take on that?
13:27
[SPEAKER_01]: I think so DPI is something you can wish for, but you can't really engineer.
13:30
[SPEAKER_01]: Obviously now that you have all this secondary infrastructure that didn't exist at all back then.
13:36
[SPEAKER_01]: So the only way to get actual DPI was to sell the companies.
13:42
[SPEAKER_01]: As you said, Chris is a legend and his fund is one of the most, if not the most successful fund ever.
13:50
[SPEAKER_01]: Second most.
13:51
[SPEAKER_01]: TVPI.
13:52
[SPEAKER_00]: Second or third.
13:53
[SPEAKER_00]: Blockchain is second and founder's funds first.
13:56
[SPEAKER_00]: I don't know if you did.
13:57
[SPEAKER_01]: I didn't know about the blockchain, but one of the most successful.
14:00
[SPEAKER_01]: Yeah, stop for anything.
14:01
[SPEAKER_01]: And I would say, I wouldn't call it yet because we don't know how much it's going to return on Stripe because it's in Stripe.
14:08
[SPEAKER_01]: He's in Stripe, so you haven't seen the Stripe, yeah.
14:12
[SPEAKER_01]: So that's what I'm going to call maybe the most successful found ever from a TVPI perspective.
14:17
[SPEAKER_01]: But,
14:18
[SPEAKER_01]: You basically sort of try and show your LP's real gains.
14:22
[SPEAKER_01]: And, unfortunately, when you see the ups and downs of SaaS stocks or SaaS companies that we've seen so recently, like you have a lot of mock-ups which are just fake, right?
14:38
[SPEAKER_01]: And so,
14:40
[SPEAKER_01]: these days, as a GP, you have to sort of trade this sort of situation between, okay, I want to provide like a successful overall outcome to my LPs in terms of how much
14:54
[SPEAKER_01]: total DPI I will return, but also you need to think about, okay, how much should I sell early on in order to sort of block some gains?
15:03
[SPEAKER_01]: And obviously trade those gains for future gains, but at least bring like hard cash to LPs who so, so dearly need it.
15:12
[SPEAKER_00]: Especially now, what is your take on secondaries?
15:15
[SPEAKER_00]: I mean, do you guys have a formula internally that you can share?
15:18
[SPEAKER_00]: How do you think about when to sell?
15:20
[SPEAKER_00]: And I say this because
15:22
[SPEAKER_00]: to your point, it is complicated as a GP right now.
15:24
[SPEAKER_00]: Markups feel fake, but they also, you know, in some ways could be quite significant, if you sell, what's your strategy for secondarys these days?
15:32
[SPEAKER_01]: So, it's something which, you know, is evolving, because obviously, we've sold about $1.5 billion worth of companies in the last few weeks, so we're gonna return, you know, pretty nice sort of,
15:48
[SPEAKER_01]: kind of pivotal distributions to our LPs, so that's going to sort of lower the pressure a little bit, but that's full of funds because we have many funds, right?
15:56
[SPEAKER_01]: We're investing fund eight.
15:58
[SPEAKER_01]: So we need to think about DPI in all the funds which are, you know, sort of in market.
16:03
[SPEAKER_01]: And I would say,
16:07
[SPEAKER_01]: If there's an organized secondary, meaning either the company is buying back some shares during a financing or is working with a secondary player to put something in place, then we'll definitely sort of look at what we should do, right, whether this is at a good price because that's the issue.
16:27
[SPEAKER_01]: Most secondaries are done at the substantial discount.
16:29
[SPEAKER_01]: And sometimes it just doesn't make any sense to sell out those prices.
16:34
[SPEAKER_01]: So yes, we want to return capital to our LPs, but we don't want to do it at like, to high sort of discount.
16:41
[SPEAKER_01]: And discount typical discounts would be like in the 25-35% sort of range, but we've seen way, way, way, way.
16:49
[SPEAKER_01]: more than that.
16:50
[SPEAKER_01]: So we think about it.
16:52
[SPEAKER_01]: We also have two funds.
16:54
[SPEAKER_01]: We have our seat fund that essentially is the one that writes the first check and has this sort of long-term commitment to our companies.
17:04
[SPEAKER_01]: But we also have our opportunity funds that come in sort of later in the life of companies
17:13
[SPEAKER_01]: of secondaries as well right so when we do around we're asking ourselves okay are we a buyer are we a seller are we a seller here and a buyer there and you know we sort of try and make the best decisions for the for the LPs and for ourselves very often we'll feel that the price is just not you know good enough and doesn't justify us sort of setting some of the early positions
17:38
[SPEAKER_01]: I would say every time a company sort of hits a billion dollar valuation, we sort of have this active conversation as to what we should do.
17:45
[SPEAKER_01]: And obviously as the company sort of raises more capital at higher valuations, if we feel that, you know, this is sort of,
17:54
[SPEAKER_01]: justified, then we'll think about setting service more position.
17:58
[SPEAKER_01]: To be candid, we've done it sort of pretty rarely.
18:01
[SPEAKER_01]: We've actually done a lot of accommodation of larger positions in our growth funds over opportunity fund.
18:09
[SPEAKER_01]: It's not rare that we own almost as much from the growth fund as we own from the C fund.
18:16
[SPEAKER_01]: It's hard for us to sort of, to say, well, nice the time to start, you know, saying some.
18:22
[SPEAKER_00]: Yeah, I mean, there's so many factors for that.
18:23
[SPEAKER_00]: There's like signal in the market.
18:24
[SPEAKER_00]: There's relationship with the founder.
18:26
[SPEAKER_00]: There's also like, if this is looking like it could be one of your winners, you don't want to cut it off at the legs.
18:30
[SPEAKER_00]: And I think that's so much of it, too.
18:32
[SPEAKER_00]: It's painful.
18:33
[SPEAKER_00]: You're like, no, I believe in this company.
18:34
[SPEAKER_00]: And I believe in these people.
18:35
[SPEAKER_01]: Yeah.
18:36
[SPEAKER_01]: And I think, though.
18:38
[SPEAKER_01]: you believe in the founder and you're there for them, like all the way, something which is extremely important, uh, John Deploy for example, we participated in every single round that they raised, which is, you know, like six or seven.
18:54
[SPEAKER_01]: And he was,
18:56
[SPEAKER_01]: It was really important to founders, even though we're just, you know, the seed lead that they had, you know, worked with for 13 years, they really sort of appreciated that were there for them all the time.
19:08
[SPEAKER_01]: It's not that the 75K check that we put in the last round, so it mattered, but it was the proof that we trusted them and we believed in them.
19:18
[SPEAKER_00]: It's continued conviction, and that's what people want to see.
19:26
[SPEAKER_01]: a secondary player that hasn't been surveyed by the company and forced them to have like a Rando on the captive or whatever, like we'll never do that.
19:36
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20:38
[SPEAKER_00]: Before each call, it shows me a well-researched brief, so I knew who I'm meeting with and the full context going in.
20:44
[SPEAKER_00]: During the call, I jot down whatever stands out, maybe it's a key word or a decision I make, and granola handles the rest.
20:50
[SPEAKER_00]: It'll transcribe in the background, on the call, and then turns my rough notes into clean, structured takeaways, the second we hang up.
20:57
[SPEAKER_00]: There's also no bots joining calls.
20:58
[SPEAKER_00]: It just works in the background.
21:00
[SPEAKER_00]: I use granola for several things.
21:02
[SPEAKER_00]: If I finish a meeting with the potential investor in my fund, I'll ask granola, what could I have done better to get my point across?
21:07
[SPEAKER_00]: If I'm meeting with a founder I like, I'll ask Granola to point out any major green flags or maybe red flags I may not have already caught.
21:13
[SPEAKER_00]: For people with a lot of the meetings and decisions that require endless context, Granola is a game changer.
21:18
[SPEAKER_00]: Actually, we're running Granola on today's episode, so you can read the full show notes at Granola.ai-slash-triolasers.
21:25
[SPEAKER_01]: New users get three months completely free that's Granola.ai-slash-triolasers.
21:29
[SPEAKER_00]: I want to ask you about it fundraising.
21:31
[SPEAKER_00]: What is your advice for fundraising?
21:33
[SPEAKER_00]: You struggled, you said, with fun.
21:34
[SPEAKER_00]: We'll fund too, went well, because you'd five XTPI.
21:37
[SPEAKER_00]: which is insane.
21:37
[SPEAKER_00]: Fun 3 was harder.
21:38
[SPEAKER_01]: So fun one ended up being sort of a 12x, but it was 5x in 3 years.
21:43
[SPEAKER_00]: 5x in 3 years.
21:44
[SPEAKER_00]: Wow.
21:44
[SPEAKER_00]: Okay, let's get the record straight.
21:46
[SPEAKER_00]: 12x on fun one, not bad.
21:47
[SPEAKER_01]: And it's, you know, it's it's good, but my partner Andy will do like double that on his, on his own and role sort of portfolio.
21:55
[SPEAKER_01]: So it's, it was pretty good for the time.
21:58
[SPEAKER_01]: Like now it's almost like at all.
22:01
[SPEAKER_01]: And so,
22:02
[SPEAKER_01]: Fun 2 had also sort of a great, you know, TVPI in DPI.
22:06
[SPEAKER_01]: This issue that made me sort of raise the fun in almost two years, was that when you go from
22:17
[SPEAKER_01]: Let's say fun to the fun 3, right?
22:19
[SPEAKER_01]: You can change a few things, right?
22:21
[SPEAKER_01]: But you don't change everything.
22:23
[SPEAKER_01]: So I went from a solo GP, being a solo GP to having a team.
22:27
[SPEAKER_01]: I went from, you know, let's just write a bunch of, you know, small checks, build a launch portfolio, and see where it goes.
22:35
[SPEAKER_01]: To, no, no, I'm going to concentrate my investments.
22:39
[SPEAKER_01]: I'm going to have a smaller portfolio.
22:40
[SPEAKER_01]: I'm going to start writing lead checks.
22:42
[SPEAKER_01]: I'm going to start taking board seats and some top off.
22:47
[SPEAKER_01]: If you think about it, I change every single element of my investment strategy.
22:52
[SPEAKER_01]: And oh, by the way, my two-and-corail piece of Fantudian come back because they were never meant to come back.
22:59
[SPEAKER_01]: And so I had to rebuild a brand new like LP based, which is pretty much still with us today.
23:06
[SPEAKER_01]: And so, like, literally, I, I, I, I wouldn't say it's cool that because I had to do it.
23:11
[SPEAKER_01]: That was, that was a total reset.
23:15
[SPEAKER_01]: LPs sort of looked at me and said, okay, awesome, and fun one is incredible, and fun two is, you know, also sort of doing super well, but fun three has nothing to do with fun two, so what the hell?
23:27
[SPEAKER_01]: And so that's how I sort of paid the price and spent my two years in pergatory, I know, to get that fun, that's unraised.
23:36
[SPEAKER_00]: Yeah, it's sometimes you just have to do it, it's like a necessary evil, but is there any advice you have now for emerging managers that are going out, trying to become more institutional, trying to build a firm that's thoughtful and differentiated?
23:46
[SPEAKER_00]: How do you do it now?
23:47
[SPEAKER_00]: I mean, it's obviously a different time.
23:49
[SPEAKER_00]: We're flashing forward 20 years later.
23:51
[SPEAKER_00]: What is your advice for them?
23:52
[SPEAKER_01]: I mean, look, you have to answer very crispy.
23:56
[SPEAKER_01]: Why the fuck does the world need yet another seat fund?
24:01
[SPEAKER_01]: Right, cause this, what, $2,500, $3,000, good nose, right?
24:07
[SPEAKER_01]: And, you know, way back when in 2010 or whatever, when there were maybe 50-seat funds, I felt that the market was really well served.
24:17
[SPEAKER_01]: Then, you know, we were like a great community.
24:19
[SPEAKER_01]: We knew each other, we were friendly each other.
24:24
[SPEAKER_01]: And when we went from 50 to 100 to 200 to like $1,000,
24:30
[SPEAKER_01]: Why?
24:31
[SPEAKER_01]: And so, at the end of the day, you need to sort of figure out what your unique stick, a call that stick.
24:38
[SPEAKER_01]: So, what is it that you do differently in terms of sourcing, in terms of industry, in terms of what you do for your founders, that will sort of give you a chance to get the deals, run with the deals, and make money for your LPs.
24:54
[SPEAKER_01]: And, you know,
24:58
[SPEAKER_01]: I welcome every single sort of one of the BGP.
25:01
[SPEAKER_01]: It's just super hard to get the LPs, especially in the world today where LPs are so busy with a re-ups so that they have to invest in the next $10 billion of Sequoia Ab sort of fund in the next 16 billion, 16-Z fund in the next whoever massive fund benchmark raising billions for the first time in ever.
25:28
[SPEAKER_01]: Attention span, their capital is extremely limited.
25:32
[SPEAKER_01]: And so unless you're super crisp in your like, okay, this is what's going to be different about this and this is how I'm going to win the deals and this is why, you know, it is worth you so Spain time with me, you won't get the attention.
25:44
[SPEAKER_00]: Yeah, I think that's good advice for everyone though.
25:47
[SPEAKER_00]: Crisp storytelling is the root of success.
25:49
[SPEAKER_01]: I mean, it's true for us.
25:50
[SPEAKER_00]: Yeah, yeah.
25:51
[SPEAKER_01]: Like, we have the same, like, for us, okay, you guys have been here for 22 years and one of the, you know, established firms was used to irrelevant, right?
26:02
[SPEAKER_01]: And we're going through a firm transition because other nouns that I was sort of stepping back my, yeah.
26:08
[SPEAKER_01]: friend and magic partner, so then he is now running the firm and you know for LPs it's something that they have to think about, right?
26:16
[SPEAKER_01]: Because for a long, long time they've underwritten me as as as the head of the firm and no longer the case.
26:22
[SPEAKER_00]: Yeah, Andy's pretty great though.
26:24
[SPEAKER_01]: He's awesome.
26:24
[SPEAKER_00]: He's awesome.
26:25
[SPEAKER_00]: Yeah, you've compiled an amazing team.
26:26
[SPEAKER_00]: Talk to me a little about that transition.
26:28
[SPEAKER_00]: Like I really want to get into succession planning.
26:30
[SPEAKER_00]: I think this is one thing that we are seeing a lot of folks of your generation that have been
26:36
[SPEAKER_00]: You know, they've done it, they've done really well, but they want it to last them.
26:39
[SPEAKER_00]: So what has been your thought process around when you were going to step down, who were you were going to hire, you know, 5, 10, 15 years ahead of time, talk to me a little bit about that in the messaging, because I saw you guys just brought on ahead of comms.
26:50
[SPEAKER_01]: Yes.
26:50
[SPEAKER_00]: Who's a killer?
26:51
[SPEAKER_00]: Yes.
26:51
[SPEAKER_00]: Great background.
26:52
[SPEAKER_00]: He seems amazing.
26:53
[SPEAKER_00]: Talk to me about how you're thinking about this next phase in succession planning.
26:57
[SPEAKER_01]: So I think you, as, um,
26:59
[SPEAKER_01]: As the head of the firm, you have to make one very clear decision at some point, which is how you build a legacy, or is the firm sort of done once you decide to sort of walk away.
27:12
[SPEAKER_01]: And either is fine, right?
27:15
[SPEAKER_01]: Just have to be very intentional about it.
27:16
[SPEAKER_01]: It's gone, like you can't switch from one to another, like and do it sort of last minute.
27:21
[SPEAKER_01]: And so, um...
27:23
[SPEAKER_01]: I would say I started thinking about what I wanted to do, maybe six, seven years ago, right?
27:31
[SPEAKER_01]: I love what I do and I continue doing it and, you know, to be very candid, I'm now 95% and cork as opposed to 100% so I'm still like, very much, super active and I keep on doing deals at all my team when we race from eight, hey you guys, I'm the Trump going to do a ton of deals, I will support you, I will source for you, whatever, whatever and I think and D&I, the number one producers in firm and when I, you know, tell my team, so,
27:59
[SPEAKER_01]: I'm out of company, it's kind of cool, and they're like, we're not again, yeah.
28:04
[SPEAKER_01]: And so, I'm still very much involved, but I had made the decision that we had to sort of think about transition.
28:12
[SPEAKER_01]: About, I think I wrote an email to my team.
28:17
[SPEAKER_01]: Yeah, 5-6 years ago was saying, hey, this is how I think about the future, and I probably have two or three funds in me, but that's basically it.
28:24
[SPEAKER_01]: So we have to sort of figure this out.
28:28
[SPEAKER_01]: I am lucky that it even years ago.
28:33
[SPEAKER_01]: My then partner, Charles Hudson, sort of said, hey, there's this dude, British, okay, he's British, fine, don't hold that as the game's same, because French British, I think.
28:44
[SPEAKER_01]: Andy McCluckland, you should really meet him because he's an awesome investor, like, incredible, angel, truck record already.
28:54
[SPEAKER_01]: And he would be a great addition to the team because he does, deaf tool, something that we don't really sort of do.
29:01
[SPEAKER_01]: So I was like, okay, I'll meet you, I'll break it.
29:04
[SPEAKER_01]: And we basically sort of met a few times and really sort of clicked and brought in the onboard as a partner.
29:12
[SPEAKER_01]: And then he just crushed it, right?
29:16
[SPEAKER_01]: And within a few funds he was very clear that we had found our next matching partner and just happened very organically and basically sort of brought him as a co-managing partner a couple of funds
29:33
[SPEAKER_01]: This will never work if I continue being the front man on the fundraising side.
29:40
[SPEAKER_01]: And so I got him so I raised fund six and he raised fund seven and seven and eight.
29:45
[SPEAKER_01]: And like literally we were super deliberate about the fact that I was I wasn't involved in anything fundraising.
29:52
[SPEAKER_01]: A barely sort of I think I saw
29:55
[SPEAKER_01]: three LPs in the last race.
29:57
[SPEAKER_01]: So they were almost hiding me.
29:59
[SPEAKER_01]: Where is he?
30:00
[SPEAKER_01]: Oh, it's gone, it's busy.
30:03
[SPEAKER_01]: And that meant that the new, I was there obviously the DPI is mine, right?
30:12
[SPEAKER_01]: Obviously now we're starting to have exits.
30:15
[SPEAKER_01]: in the portfolios that my partners have sold.
30:18
[SPEAKER_01]: But when our big fund drivers in fund four, fund five, you know, sale, that will be sold in this truck record.
30:25
[SPEAKER_01]: And so you essentially engineer this, okay, who's the frontman, who is everybody seeing, and like even podcasts, it just happens that I was in New York and you were very kind to have me on this on this podcast.
30:44
[SPEAKER_00]: and love that.
30:44
[SPEAKER_00]: How are you spending your time these days?
30:46
[SPEAKER_00]: I mean, I know you said 95% still on quirk.
30:48
[SPEAKER_00]: Um, I have done my research.
30:50
[SPEAKER_00]: I see there's a lot of eating good food.
30:52
[SPEAKER_00]: There's a lot of using your tonal.
30:53
[SPEAKER_00]: There's some wine projects.
30:56
[SPEAKER_00]: Talk to me about what you are doing now these days that you've more time.
31:00
[SPEAKER_01]: I don't have more time.
31:01
[SPEAKER_01]: So, basically.
31:02
[SPEAKER_01]: You make the time.
31:03
[SPEAKER_01]: I basically have not.
31:05
[SPEAKER_01]: like step back from an cork yet.
31:09
[SPEAKER_01]: So the only thing I've carved out is my Friday afternoon is time has spent at the winery.
31:14
[SPEAKER_01]: So we've launched, or we're launching a small project in what I want to Washington, where we just moved.
31:22
[SPEAKER_01]: So it's called Clocladier.
31:25
[SPEAKER_01]: Clos, CLOS, Clavier on Instagram.
31:28
[SPEAKER_01]: So feel free to, too, for us.
31:31
[SPEAKER_01]: We have just bought all the first two wines.
31:35
[SPEAKER_01]: So the, because I'm cheeky, the wines are called after, named after terms of the vc industry.
31:42
[SPEAKER_01]: So our red wine is called series B.
31:45
[SPEAKER_01]: Name after our grandson, Braden.
31:48
[SPEAKER_01]: And our white wine is called liquid pref.
31:51
[SPEAKER_01]: And yes, Josh Gopelman, a year ago, said, you have to actually make a carried interest.
31:58
[SPEAKER_01]: And so we have in barrels a carried interest that will raise either next year or the year after.
32:05
[SPEAKER_01]: We'll have to decide.
32:06
[SPEAKER_00]: Pretty epic.
32:07
[SPEAKER_01]: Pretty epic.
32:08
[SPEAKER_00]: Blending of all your passions.
32:09
[SPEAKER_01]: Yes.
32:09
[SPEAKER_00]: It's always fun when you can do that.
32:11
[SPEAKER_00]: You know, I feel like that's not very common.
32:12
[SPEAKER_00]: You can take your.
32:13
[SPEAKER_00]: your passion in one area and another and make something really special.
32:15
[SPEAKER_01]: Well, I've had, you know, the passion for wine for a long time.
32:18
[SPEAKER_01]: I've been, I've been, well, you're French.
32:20
[SPEAKER_00]: It's like a DNA, right?
32:21
[SPEAKER_01]: Yes, it's in the DNA, but I've been like, you know, collecting since 1992.
32:29
[SPEAKER_01]: Long time passion, long time passion.
32:31
[SPEAKER_01]: And so it's kind of fun to, and it's also, you know, sort of, but my wife Bernardette was my, my partner in the, the very days of,
32:43
[SPEAKER_01]: went until she decided to join Stanford to run the Center for Social Innovation, where she spent 18 years.
32:51
[SPEAKER_01]: And so it's fun to sort of do another startup project with her.
32:56
[SPEAKER_01]: And so I'm basically designing the wines with a worldwide maker who's incredible.
33:02
[SPEAKER_01]: And she's basically busy putting the final touches to the website, the commerce infrastructure.
33:09
[SPEAKER_01]: She's managing the location list, which we need to find about
33:14
[SPEAKER_01]: two to three hundred people to set up, you know, our first production is going to be very small.
33:19
[SPEAKER_01]: 176 cases, this first vintage.
33:23
[SPEAKER_01]: And so she's busy doing all that and also being a memory because we have a two-year-old grandson which we adore and it's super fun to see him pretty much over there.
33:34
[SPEAKER_00]: Yeah, very special.
33:35
[SPEAKER_00]: You've built such an incredible life, and now you can invest in your passion, which is really amazing.
33:39
[SPEAKER_00]: I think that's people don't realize this always, but firm founders, GPs like yourself, it's building.
33:46
[SPEAKER_00]: They're starting a company, and now you're back to building some, we're founders.
33:49
[SPEAKER_01]: We're founders, we're just founders of a different kind, because for people, people don't, as you sort of said, people don't think about VC firm as a startup,
34:02
[SPEAKER_01]: stuff that was very much a one-man startup for six years before I decided to which is one of the other decision I made which was hey it's kind of the only to be doing everything and I need I need help and I want to work with people and so after six years of being a sort of GP I wrote you know my first partner, Charles Watson and now head of operations actually as my first employee assistant and 15 years later she's still with me.
34:31
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[SPEAKER_00]: OK, so quick experiment.
35:35
[SPEAKER_00]: Think about the last long message you typed.
35:37
[SPEAKER_00]: could be a slack thread, a prompt into claw, maybe it's a detailed email, it probably took you 10 minutes, maybe even 20 to get it right.
35:44
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35:46
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35:48
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35:52
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35:56
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35:59
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36:04
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36:10
[SPEAKER_00]: What I personally love about it too is that it perfectly matches my style.
36:13
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36:17
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36:23
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36:35
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36:46
[SPEAKER_00]: I want to talk to you a little bit about the types of companies you're excited about these days.
36:49
[SPEAKER_01]: Yep.
36:50
[SPEAKER_00]: when you do bring in a deal and they roll their eyes, it looks like the categories are a lot of hardware in front of your tech.
36:56
[SPEAKER_00]: And when I look at your track record, you've got some of that, for sure, you know, grock, being a very notable winner there.
37:03
[SPEAKER_00]: Why that category?
37:04
[SPEAKER_00]: And what are you excited about?
37:05
[SPEAKER_00]: What makes you excited to meet a founder these days?
37:07
[SPEAKER_01]: So
37:09
[SPEAKER_01]: first and foremost, I've invested in pretty much everything on the design, right?
37:13
[SPEAKER_01]: A, I was on my own, so I was doing every single type of deal.
37:18
[SPEAKER_01]: So I started pretty much on the consumer side with Web2R, then I started investing in SaaS, did a bit of a hard, like Fitbit was my first hardware company, and the question I had was, well,
37:34
[SPEAKER_01]: it's kind of capital efficient to build a software company in 2008, I wonder whether it's capital efficient to build a hardware company and I was looking for hardware companies and there was literally no one raising money as a hardware company in 2008 until
37:54
[SPEAKER_01]: I made the Fitbit guys and they had this clunky prototype that showed that, you know, it could count steps which was something, you know, something that a physical step counter, you could buy for 20 bucks at bullet greens was doing really well.
38:08
[SPEAKER_01]: And it was like, hmm, this is kind of interesting.
38:11
[SPEAKER_01]: I like the guys, but I'm sure there is like, there's going to be a ton of demand.
38:14
[SPEAKER_01]: And
38:16
[SPEAKER_01]: I saw them present at the current 50 in 2008.
38:23
[SPEAKER_01]: And I still remember seeing Ed Williams, seeing Ed Williams, and giving Rose, being super excited were judges for their session.
38:31
[SPEAKER_01]: It was super exciting, it was.
38:33
[SPEAKER_01]: I wanted this, I had like, OK, those two dudes wanted, maybe it's going to go somewhere and then I invested.
38:39
[SPEAKER_00]: I love it.
38:39
[SPEAKER_00]: We are, but anyway, and so it's a good signal, though, because we're all humans and when you see their humans want something, it is just into intuition.
38:46
[SPEAKER_01]: And by the way, the answer of to the question, is it capable of efficient to build a hardware company?
38:54
[SPEAKER_01]: Hell no.
38:56
[SPEAKER_01]: it's horrible and hardware is, you know, so the company is typically sort of get easier over time.
39:03
[SPEAKER_01]: Hardware companies are feel get harder over time because you always have issues with your supply chain and as you sort of need to spin up like CMs and so on and so forth like it's just good over.
39:15
[SPEAKER_01]: But it was a really good outcome.
39:18
[SPEAKER_01]: And over time, like this, I just added new sort of sectors for us to invest in, and the Sony was instrumental and having us become a super active investor in DevTools.
39:30
[SPEAKER_01]: And...
39:32
[SPEAKER_01]: As we wrote, you know, awesome partners, I would like to say something about the trip or something.
39:39
[SPEAKER_01]: Amy, this sort of all on a portion of investment strategy.
39:43
[SPEAKER_01]: And the one that was left is kind of the weird stuff onto your tag, deep tag, like things which are markets, which are not established yet.
39:55
[SPEAKER_01]: And I kind of naturally gravitate towards those, because it's super interesting from a personal standpoint, like discovering new things, learning new things.
40:07
[SPEAKER_01]: And so what Luke for now is incredible fathers, building wicked things that are kind of new and heard of, or new ways of doing something that's been tried before and people felt that.
40:24
[SPEAKER_01]: I would have told people, well, look, besides nuclear fusion and asteroid mining, I couldn't invest in anything.
40:32
[SPEAKER_01]: So don't try to sort of figure out what I'm going to do next because you can't, because I don't even know, just bring me incredible founders and I will sort of do the sorting in the filtering.
40:45
[SPEAKER_01]: And then I was catching up with my friend, Jeff Losen.
40:52
[SPEAKER_01]: Well, I had passed on Twilio when he was raising his sit around because like a dumbfuck I thought that his family and pre-valuation was too expensive Right you heard the story a lot.
41:03
[SPEAKER_01]: It seems expensive in the moment not in hindsight I would have invested at three pre-pre any wanted five pre-wrestier expensive like what a stupid ass anyway I'm catching up with him and he's basically you know telling me about The new confusion startup that is starting in I'm like
41:21
[SPEAKER_01]: Okay, and I said, okay, tell me more, and I went back to my team and I said, okay, so remember when I said that we never invested in your free version, meet in our shop.
41:32
[SPEAKER_01]: And so I wrote a very large check for us in the in our shop, 2015 dollar around, and I'm super excited to work with Jeff, who's one of my favorite favorite entrepreneurs.
41:45
[SPEAKER_01]: And so,
41:48
[SPEAKER_01]: I meet sort of incredibly smart people and to tell me your story and every nine then, I'm like, okay, I'm gonna hit me, but this is worth it.
42:00
[SPEAKER_00]: Yeah, well the beauty too of being this business for so long is your network compound.
42:03
[SPEAKER_00]: So someone like Jeff, you know, there's a lot of founders that start a company to certain valuation and then the other goes well or it doesn't and they want to sort of another one and then another one and you can be that partner for them through it all as they get more successful, which I think is so gratifying too because you can build those deep partnerships, but also you can get access early to the very best because you've been in it for a while.
42:20
[SPEAKER_01]: And we have a lot of people who have just done that, you know,
42:29
[SPEAKER_01]: always decent and quick in what decision making and they come back to us.
42:33
[SPEAKER_01]: you know, showing us like company number two, coming number three.
42:36
[SPEAKER_01]: And so it's very good to find to build those non-term relationships where we try, we try to, you know, give you a quick note, we try to be helpful, we don't get in the way.
42:45
[SPEAKER_01]: Do no harm is the number one, you know, sort of rule, always, there's always something that we've done for the companies that, you know, probably save their bacon and without us, they wouldn't be there.
42:57
[SPEAKER_01]: So any, what's the case with Fitbit?
43:00
[SPEAKER_01]: And that's how you build this compounding reputation where people will just say, hey, just take his money.
43:07
[SPEAKER_00]: Yeah.
43:07
[SPEAKER_00]: What's the most painful company that you've passed on?
43:10
[SPEAKER_00]: So you mentioned Twilio.
43:11
[SPEAKER_00]: I'm sure there's so many that you can run through in your head right now.
43:14
[SPEAKER_00]: But which one do you look back on?
43:15
[SPEAKER_00]: I was really close and I just missed it.
43:19
[SPEAKER_01]: Oh, there's literally half a dozen that would qualify.
43:23
[SPEAKER_01]: But I would say if I had to, like my number one regret is over.
43:28
[SPEAKER_01]: because I got the pitch.
43:31
[SPEAKER_01]: So if you have followed the history of Uber, you heard about Travis and Garrett coming up with the idea, in Paris during a snowstorm at a really awesome dinner.
43:50
[SPEAKER_01]: I was at the dinner, and actually, so what happened is we were at the web, right, that was put together by my dear friend, Riklomer, and there's a massive snowstorm, and we're on the outskirts of Paris, like in the north, and there's nothing, like, there's no taxi, there's nothing, there's no car, because there's like, you know, a foot of snow, something.
44:16
[SPEAKER_01]: And so actually sort of dragged all these people like put them in a big sort of taxi and I drove them to the subway and I sort of stood them around in the Paris subway so that we could actually drop them on the Champs-Aise, you know, where the hotel was.
44:35
[SPEAKER_01]: And we then met,
44:37
[SPEAKER_01]: at this crazy hotel, but particularly in Paris in the eighth, where they had, you know, this sort of discussion.
44:43
[SPEAKER_01]: And so it was there.
44:45
[SPEAKER_01]: And I haven't known Travis for a long time, or didn't get it for a long time.
44:48
[SPEAKER_01]: And so when they pitched me in June of 2010, the concept of Uber, cab, Uber cab, by the way, it wasn't over yet.
44:57
[SPEAKER_01]: I was like, well, you know, this sort of
45:05
[SPEAKER_01]: It was just like, get a limo held on your phone and then paid directly.
45:12
[SPEAKER_01]: But my big problem in the reason why I passed was that Travis wasn't the CEO.
45:18
[SPEAKER_01]: And he introduced, he mentioned, hey, we're just hired a dude, and we found him on Twitter, so he's like a, I'd exactly whatever.
45:28
[SPEAKER_01]: doesn't like the right background for being CEO.
45:32
[SPEAKER_01]: What would you be CEO?
45:33
[SPEAKER_01]: Well, I want to do something else, whatever.
45:34
[SPEAKER_01]: And Garrett, I want to do something else.
45:36
[SPEAKER_01]: And so, at the end of the day, if you don't believe in the execution capability of the team, then you don't invest.
45:43
[SPEAKER_01]: And so that's why I passed.
45:45
[SPEAKER_01]: when I met them and then just in Kaleckan is organized like an angel network pitch day, whatever, house in woodside, I was there and Travis pitch and I was like the pitch was really good, but I had an issue with the
46:02
[SPEAKER_01]: the CO, so a past kind of didn't act the second time, strike two, and then what's crazy is it took the entire summer of 2010 for Uber to raise, right?
46:16
[SPEAKER_01]: That's the thing which is insane, right?
46:18
[SPEAKER_01]: And it was like five pre or four pre or whatever, like it was ridiculously cheap.
46:23
[SPEAKER_01]: And there was like a hundred K left in early September of 2010, and
46:29
[SPEAKER_01]: I'm like, okay, I'll take it, so I think those guys say, hey, you know, if it's how there's on K-Left, can I get it?
46:39
[SPEAKER_01]: And they said, oh, super exciting, whatever, whatever.
46:41
[SPEAKER_01]: And then they said, oh, sorry, we decided to so get to someone from the kind of transportation industry, so thanks with no thanks.
46:54
[SPEAKER_01]: And then, many years later, I was telling this story at the dinner, and then someone left his ass off on the other side of the table and said, actually, I got the last, I'm okay with that.
47:07
[SPEAKER_00]: That was the transportation guy.
47:08
[SPEAKER_01]: No, he was another VC.
47:11
[SPEAKER_00]: So they lied, you know, whatever.
47:13
[SPEAKER_00]: They wanted to give to someone else.
47:16
[SPEAKER_01]: I got my two chances in a past and that would have been transformational forward to our record.
47:21
[SPEAKER_01]: Yeah.
47:22
[SPEAKER_01]: That's hysterical.
47:23
[SPEAKER_00]: You came across the person who took your last delicacy.
47:26
[SPEAKER_00]: Oh, that's painful.
47:27
[SPEAKER_01]: What's the, he's actually a really good friend.
47:29
[SPEAKER_01]: Bill Trentard, who's, Oh, yeah, of course, we're filmed.
47:31
[SPEAKER_00]: He's amazing.
47:32
[SPEAKER_00]: Yeah, everyone loves him.
47:33
[SPEAKER_00]: He's wonderful.
47:34
[SPEAKER_00]: Um, it's funny, you're, you're talking about Bill, we talked about JavaScript, about James Fitbit.
47:39
[SPEAKER_00]: You, these are all lobby guys.
47:41
[SPEAKER_01]: Yep.
47:41
[SPEAKER_00]: Like all Hawaii lobby guys.
47:43
[SPEAKER_00]: I'm kind of just realizing that right now.
47:44
[SPEAKER_01]: Yes.
47:44
[SPEAKER_00]: So let's talk about postmates.
47:46
[SPEAKER_00]: You guys let the seed there.
47:47
[SPEAKER_00]: Tell me how you first met the team.
47:48
[SPEAKER_01]: So made Bastion, um, and Sean, they were pitching, like a random,
47:59
[SPEAKER_01]: whatever thing, it was like a media play, they were in X-ray through a batch, and
48:10
[SPEAKER_01]: Vastion was like a really super interesting entrepreneur, but the idea was like super stupid.
48:14
[SPEAKER_01]: And so I was like, yeah, not doing that.
48:17
[SPEAKER_01]: And then I don't remember how but I heard that they had sort of done the proverbial for the pivot into postmates.
48:25
[SPEAKER_01]: And I thought it was just genius, right?
48:27
[SPEAKER_01]: This notion of, well, anything that you want comes to you.
48:32
[SPEAKER_01]: They've heard on the bike in San Francisco.
48:36
[SPEAKER_01]: And I really, really like question, as an entrepreneur, a really action as a CTO.
48:42
[SPEAKER_01]: So exceptional founders, building a crazy idea.
48:46
[SPEAKER_01]: And so I let their seed round.
48:49
[SPEAKER_01]: I let their second seed round.
48:51
[SPEAKER_01]: I sort of wired emergency funds to have them make peril before they received their series paycheck from the fund.
49:01
[SPEAKER_01]: because it was like a couple of days late and they were literally out of cash, and then the build's like an amazing company, and you know we had a great outcome, but it was it was hard to scale the thing, it was hard.
49:16
[SPEAKER_00]: Yeah, and lots of competition.
49:17
[SPEAKER_00]: I mean, similar to the Uber story, like once you really kill it with a consumer marketplace, you've got just everyone coming for you.
49:23
[SPEAKER_00]: It's not easy.
49:24
[SPEAKER_01]: No, absolutely.
49:25
[SPEAKER_01]: What endowed Ash to be honest, like door Ash wouldn't exist if Bastion had agreed to essentially launch placemates in the verbs, right?
49:35
[SPEAKER_01]: But he was fixated on, hey, we have to focus, we need to be in San Francisco, I don't care about Palo Alto, whatever, whatever.
49:41
[SPEAKER_01]: And that's why Tony and the voice, you know, when you're in a garage in, you know, to get the pizza delivered in the other one.
49:49
[SPEAKER_01]: And what's hilarious is I was a judge of some business fan competition at Stanford.
49:57
[SPEAKER_01]: And here's the Dol dash team, like, pitching me Dol dash, saying, oh, Postmate does this and Postmate does that.
50:04
[SPEAKER_01]: And I'm like, nope, it doesn't do that.
50:06
[SPEAKER_01]: And like, how do you know?
50:07
[SPEAKER_01]: So I'm really interested in the company.
50:12
[SPEAKER_00]: So here's a problem I hear constantly from operators.
50:15
[SPEAKER_00]: The data exists.
50:16
[SPEAKER_00]: The answers are somewhere in there, but getting to that actually pulling a useful insight without bugging the data team or learning sequel takes way too long or just does not happen.
50:24
[SPEAKER_00]: Hex solves that.
50:26
[SPEAKER_00]: Hex is an AI analytics platform where anyone on your team can ask data questions and plain English.
50:31
[SPEAKER_00]: and get real answers backed by your actual business context, no sequel required.
50:36
[SPEAKER_00]: And the best part is that Hex shows you exactly how it's data agents think, so you can see where the logic comes from and trust the output.
50:42
[SPEAKER_00]: The more your team uses it, the smarter it gets.
50:45
[SPEAKER_00]: From seed stage founders running lean to larger works dealing with serious data complexity, Hex is built to scale with you.
50:51
[SPEAKER_00]: It's game-changing for people like me who want to understand what's going on under the hood, but we are not the data experts.
50:56
[SPEAKER_00]: It's funny too because I feel like every time I look over my operator friend's shoulders, whether they're in product, or marketing, or ops, they often have a hex dashboard pulled up.
51:04
[SPEAKER_00]: It's a great tool.
51:05
[SPEAKER_01]: True Blazers listeners get an exclusive 30-day free trial at hex.ai slash trailblazers.
51:09
[SPEAKER_00]: Let's get into our trailblazers tradeoffs.
51:11
[SPEAKER_00]: I get to keep papering with questions, but I want to make sure we get to those.
51:14
[SPEAKER_00]: Uh, tell me what comes to mind first.
51:16
[SPEAKER_00]: Okay.
51:17
[SPEAKER_00]: Book in hand or podcast in ears.
51:19
[SPEAKER_01]: Uh, podcast in ears.
51:20
[SPEAKER_00]: Okay.
51:20
[SPEAKER_00]: Any favorites?
51:23
[SPEAKER_01]: I'm pretty eclectic, but I was a huge fan of BG2, and I'm really sad that they stopped sort of recording.
51:32
[SPEAKER_01]: I like more or less, because I know the four, and so I can't even enjoy the banner.
51:37
[SPEAKER_00]: It's cool how they're married, you know, it's really sweet.
51:39
[SPEAKER_00]: You can see the behind closed doors.
51:41
[SPEAKER_01]: But they kick each other, it's super fun.
51:43
[SPEAKER_01]: Like everybody, Gangseung, Gangseung, which I really enjoy.
51:47
[SPEAKER_01]: And so I have several, but the one I kind of try and listen to is a sort of bonus.
51:55
[SPEAKER_00]: Love that.
51:56
[SPEAKER_00]: Higher slow or fire fast.
51:58
[SPEAKER_01]: Oh, both.
52:00
[SPEAKER_00]: You had to pick, which matters more.
52:04
[SPEAKER_01]: Fire fast.
52:06
[SPEAKER_00]: Ten small wins or one big moon shot.
52:10
[SPEAKER_01]: Oh, moon shot.
52:11
[SPEAKER_01]: It's a business.
52:12
[SPEAKER_01]: You don't do what I do if you're not like a moon shot, like Hunter.
52:16
[SPEAKER_00]: Love it.
52:17
[SPEAKER_00]: Being early or being right.
52:19
[SPEAKER_01]: Being early.
52:21
[SPEAKER_01]: Always.
52:21
[SPEAKER_00]: What's the best teacher, a mentor, or a mistake?
52:28
[SPEAKER_01]: At the end of the day, mistake.
52:30
[SPEAKER_00]: OK. Any reason why a mistake versus a mentor?
52:35
[SPEAKER_01]: You can't be told and learn.
52:39
[SPEAKER_01]: You have to experience too long.
52:48
[SPEAKER_01]: uh... abandoned kios is it one and then the other nights is it one more than the other it's it's more chaotic yeah it's it's going to be it's going to be it's going to be chaotic for sure killer product or loyel niche audience
53:08
[SPEAKER_01]: I mean, you can get, you can build something which works really, really well and makes you a bunch of money without ever needing sort of VC capital and building the VC worthy sort of company.
53:23
[SPEAKER_01]: And so it's really hard to, like, kill a product is what sort of we all sort of strip for.
53:31
[SPEAKER_00]: VC or bootstrapping.
53:35
[SPEAKER_01]: Well, I mean, there's nothing wrong with bootstrapping, there's nothing wrong with never raising this money, but at the end of the day what what I do for leaving and what I love is to be able to just lead, you know, this thing on fire once, you know, they raise like the capital they need to do whatever we can unlock, right?
53:58
[SPEAKER_00]: It's very exciting.
53:59
[SPEAKER_00]: If even nothing lasts, these see as very exciting.
54:01
[SPEAKER_00]: Never post on social media again, or never fundraise in at the dollar for any of your funds again.
54:08
[SPEAKER_01]: Well, I've already done the latter, but I'm not like super super active on social media.
54:13
[SPEAKER_01]: I mean, I've actually been posting quite a bit on the, on the Clocladier handle, but I these days I tend to sort of repost what my partners are posting because I have a lot of audience.
54:25
[SPEAKER_00]: The last question for the trade-offs is AI overhyped or underhyped?
54:31
[SPEAKER_01]: I think it goes up and down in terms of cycles.
54:37
[SPEAKER_01]: Overhyped in the short term, underhyped in the long term.
54:40
[UNKNOWN]: Okay.
54:40
[SPEAKER_00]: What do you most excited about with the act?
54:42
[SPEAKER_00]: What's like the one thing that you think no one is talking about that you are very excited about?
54:46
[SPEAKER_01]: I don't think I have anything sort of new or special to contribute.
54:51
[SPEAKER_01]: It's just the um.
54:53
[SPEAKER_01]: Juton's informational nature of AI and the speed at which we see companies scaling.
54:58
[SPEAKER_01]: I have never seen in my 26-year career as a VC.
55:03
[SPEAKER_01]: We have one where we invested four or five months ago.
55:08
[SPEAKER_01]: We invested.
55:10
[SPEAKER_01]: They released the product.
55:12
[SPEAKER_01]: They went from zero to one to ten to fifty to
55:23
[SPEAKER_01]: What the fuck?
55:24
[SPEAKER_01]: And like, we've never seen that.
55:27
[SPEAKER_01]: We have a lot of companies which are just getting really, really fast.
55:30
[SPEAKER_01]: But that one is like the vertical.
55:34
[SPEAKER_01]: And they're super smart, they're trying to sort of, you know, belling the rocket as they fly it.
55:40
[SPEAKER_01]: And we'll see where that goes.
55:41
[SPEAKER_01]: But I've just never seen that.
55:43
[SPEAKER_01]: And the impact of AI,
55:49
[SPEAKER_01]: I think is, isn't that we're on the studio?
55:51
[SPEAKER_01]: People are sort of freaking out about it.
55:53
[SPEAKER_01]: I think there's a lot of positives, but there's a lot of Godwales to implement.
55:58
[SPEAKER_01]: Because the whole thing about the model going rogue and then going like, you want me to do that?
56:04
[SPEAKER_01]: Okay, I'm just gonna hack this thing.
56:07
[SPEAKER_01]: That's crazy.
56:08
[SPEAKER_00]: Scare's a lot of people.
56:09
[SPEAKER_00]: Scare's a lot of people who are in technical and really deeply understand what's happening.
56:12
[SPEAKER_01]: Yes.
56:12
[SPEAKER_00]: Yeah, absolutely.
56:14
[SPEAKER_00]: Jeff, thank you so much for being here.
56:15
[SPEAKER_00]: It's really fun.
56:15
[SPEAKER_01]: Thanks for having me, Erica.
56:17
[SPEAKER_00]: Thanks so much for listening to the Trailblazers Podcast.
56:19
[SPEAKER_00]: If you found this conversation Bible, please follow along on socials, share with a friend, leave a review, all the things.
56:25
[SPEAKER_00]: Most of all, please subscribe to our channel.
56:27
[SPEAKER_00]: It helps more Contrained Builders find us and supports the work we're doing here.
56:31
[SPEAKER_00]: To learn more about what we're doing, you can visit Trailblazerspod.com or my venture capital firm, parkrangerscapt.com, or just follow along on socials at Erica Underscore Winger.
56:40
[SPEAKER_00]: Until next time, keep trailblazing.