The Twenty Minute VC — Insights from Coatue's Growth Investor Lucas Swisher

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I think I think you're absolutely right. I think I think you're absolutely right. I think it's changing and I think it think it's changing and I think it think it's changing and I think it changes during every architecture shift, changes during every architecture shift, changes during every architecture shift, right? This is the really critical part right? This is the really critical part right? This is the really critical part of technology, right? As you moved from of technology, right? As you moved from of technology, right? As you moved from on premise technology to SAS technology, on premise technology to SAS technology, on premise technology to SAS technology, as you moved from the internet to mobile as you moved from the internet to mobile as you moved from the internet to mobile internet, right? You had a potential for internet, right? You had a potential for internet, right?

You had a potential for all of the companies in the prior all of the companies in the prior all of the companies in the prior generation to completely evaporate. And generation to completely evaporate. And generation to completely evaporate.

And the big question is, can you find the the big question is, can you find the the big question is, can you find the companies that have the talent density, companies that have the talent density, companies that have the talent density, that are the most forward thinking, that that are the most forward thinking, that that are the most forward thinking, that are willing to reinvent themselves over are willing to reinvent themselves over are willing to reinvent themselves over and over and over again, which is so and over and over again, which is so and over and over again, which is so hard, and those are the companies that hard, and those are the companies that hard, and those are the companies that you want to find. I I think of a great you want to find. I I think of a great you want to find.

I I think of a great example every time I I think of this example every time I I think of this example every time I I think of this point, which is data bricks, right? If point, which is data bricks, right? If point, which is data bricks, right? If you talk to Ali from Data Bricks, um you talk to Ali from Data Bricks, um you talk to Ali from Data Bricks, um we've been an investor since 2019. I we've been an investor since 2019. I we've been an investor since 2019. I think one of the things that we've seen think one of the things that we've seen think one of the things that we've seen from there and even before, I mean, I from there and even before, I mean, I from there and even before, I mean, I looked at the company when I was at looked at the company when I was at looked at the company when I was at Kleiner Perkins. um I've seen this Kleiner Perkins. um I've seen this Kleiner Perkins.

um I've seen this company for a very long time is his company for a very long time is his company for a very long time is his ability to reinvent that company over ability to reinvent that company over ability to reinvent that company over and over and over again and ride and over and over again and ride and over and over again and ride multiple scurves from being you know multiple scurves from being you know multiple scurves from being you know basically an ELT data transformation basically an ELT data transformation basically an ELT data transformation layer to you know running in training layer to you know running in training layer to you know running in training models to being the center of all data models to being the center of all data models to being the center of all data in the enterprise. Those are like in the enterprise. Those are like in the enterprise.

Those are like multiple S-curves that he's hopped and multiple S-curves that he's hopped and multiple S-curves that he's hopped and multiple times he's reinvented the multiple times he's reinvented the multiple times he's reinvented the company. And I think it's not revenue company. And I think it's not revenue company. And I think it's not revenue growth that you want to chase. It's that growth that you want to chase. It's that growth that you want to chase.

It's that it is the most incredible it is the most incredible it is the most incredible adoption of new trends and moving with adoption of new trends and moving with adoption of new trends and moving with the next chapter that I think we've ever the next chapter that I think we've ever the next chapter that I think we've ever seen actually cuz you could look at like seen actually cuz you could look at like seen actually cuz you could look at like a replet and go similar actually how a replet and go similar actually how a replet and go similar actually how they've co-attached to a new cycle. I they've co-attached to a new cycle. I they've co-attached to a new cycle. I mean this is another leak. You mentioned mean this is another leak. You mentioned mean this is another leak. You mentioned the growth of revenue there. This is the the growth of revenue there.

This is the the growth of revenue there. This is the other hard thing which is like when we other hard thing which is like when we other hard thing which is like when we did lovables a it was like at 3 million did lovables a it was like at 3 million did lovables a it was like at 3 million in revenue. By the time the legals were in revenue. By the time the legals were in revenue. By the time the legals were done it was at 20. done it was at 20. done it was at 20. >> Mhm. >> Mhm. >> Mhm. >> And so the multiple had gone from 70x to >> And so the multiple had gone from 70x to >> And so the multiple had gone from 70x to 10x. 10x. 10x. >> Correct. I mean, Anton should have been >> Correct. I mean, Anton should have been >> Correct. I mean, Anton should have been asking for a trade like I I want to asking for a trade like I I want to asking for a trade like I I want to renegotiate this.

renegotiate this. renegotiate this. >> How do we value assets that are growing >> How do we value assets that are growing >> How do we value assets that are growing in such disproportionate or previously in such disproportionate or previously in such disproportionate or previously unseen ways? unseen ways? unseen ways? >> Yeah. Again, I think it's this is one of >> Yeah. Again, I think it's this is one of >> Yeah. Again, I think it's this is one of the this is one of the hardest things. the this is one of the hardest things. the this is one of the hardest things. It's why we actually think the the It's why we actually think the the It's why we actually think the the framework that we use internally is we framework that we use internally is we framework that we use internally is we think about valuation. Everybody has to think about valuation. Everybody has to think about valuation.

Everybody has to think about valuation. But when a think about valuation. But when a think about valuation. But when a company is growing exponentially, 10x company is growing exponentially, 10x company is growing exponentially, 10x year on year, 50x year on year, right? year on year, 50x year on year, right? year on year, 50x year on year, right? the things that we're seeing now, we the things that we're seeing now, we the things that we're seeing now, we think about valuation last. It's the think about valuation last. It's the think about valuation last. It's the last question we try to answer. Is is last question we try to answer. Is is last question we try to answer. Is is the valuation great? Because like you the valuation great? Because like you the valuation great?

Because like you mentioned, you may invest in a series C mentioned, you may invest in a series C mentioned, you may invest in a series C at 20 million of ARR at 3 billion post at 20 million of ARR at 3 billion post at 20 million of ARR at 3 billion post and that seems insane. But if the 20 and that seems insane. But if the 20 and that seems insane. But if the 20 goes to a 200 in one year and then 600 goes to a 200 in one year and then 600 goes to a 200 in one year and then 600 the next and 3 billion the next, all of the next and 3 billion the next, all of the next and 3 billion the next, all of a sudden that looks extremely cheap. And a sudden that looks extremely cheap. And a sudden that looks extremely cheap. And so our job is how do you find the things so our job is how do you find the things so our job is how do you find the things that are on that curve?

Okay, let's take that are on that curve? Okay, let's take that are on that curve? Okay, let's take that. Actually, that's an interesting that. Actually, that's an interesting that. Actually, that's an interesting one. Let's say you are investing in a one. Let's say you are investing in a one. Let's say you are investing in a company that is doing, I don't know, 50 company that is doing, I don't know, 50 company that is doing, I don't know, 50 million in revenue and you're paying, I million in revenue and you're paying, I million in revenue and you're paying, I don't know, 4.5 billion. don't know, 4.5 billion. don't know, 4.5 billion.

>> Um, specific numbers >> Um, specific numbers >> Um, specific numbers >> and they say we're going to be at 250 >> and they say we're going to be at 250 >> and they say we're going to be at 250 million million million >> and you go at the end of the year, >> and you go at the end of the year, >> and you go at the end of the year, you're like, wow, gosh, you're going to you're like, wow, gosh, you're going to you're like, wow, gosh, you're going to 5x in a year and then we're going to 3x 5x in a year and then we're going to 3x 5x in a year and then we're going to 3x the next year to 750 million. Wow. Well, the next year to 750 million. Wow. Well, the next year to 750 million. Wow. Well, you paid 4 and a half. M you paid 4 and a half. M you paid 4 and a half.

M >> so even if it doubles or triples and >> so even if it doubles or triples and >> so even if it doubles or triples and then doubles again you're still not at then doubles again you're still not at then doubles again you're still not at the 6 or 7x that it will be valued at in the 6 or 7x that it will be valued at in the 6 or 7x that it will be valued at in a public market how do you just get your a public market how do you just get your a public market how do you just get your head around the hard dynamics of what it head around the hard dynamics of what it head around the hard dynamics of what it will be in a public market will be in a public market will be in a public market >> yeah no I think this is I think it's a >> yeah no I think this is I think it's a >> yeah no I think this is I think it's a great question and it it filters down great question and it it filters down great question and it it filters down into every decision that we think about into every decision that we think about into every decision that we think about all the time right and I think the key all the time right and I think the key all the time right and I think the key is first you want to be in gigantic TAMs is first you want to be in gigantic TAMs is first you want to be in gigantic TAMs big ideas only right because if you ever big ideas only right because if you ever big ideas only right because if you ever compromise on that very first principle compromise on that very first principle compromise on that very first principle and you're paying high valuations, and you're paying high valuations, and you're paying high valuations, you're in trouble.

Medium TAM, small you're in trouble. Medium TAM, small you're in trouble. Medium TAM, small TAM, you better believe that this thing TAM, you better believe that this thing TAM, you better believe that this thing can be absolutely gigantic. We have this can be absolutely gigantic. We have this can be absolutely gigantic. We have this test internally, right? Where it used to test internally, right? Where it used to test internally, right? Where it used to be 5 years ago, we called it the $10 be 5 years ago, we called it the $10 be 5 years ago, we called it the $10 billion public company test, right? Can billion public company test, right? Can billion public company test, right? Can this be a $10 billion plus public this be a $10 billion plus public this be a $10 billion plus public company? company? company?

>> That bar has changed, >> That bar has changed, >> That bar has changed, >> right? In this in this new world because >> right? In this in this new world because >> right? In this in this new world because we are tackling much larger markets than we are tackling much larger markets than we are tackling much larger markets than we used to. And so now that test is can we used to. And so now that test is can we used to. And so now that test is can you be just an enduring public company? you be just an enduring public company? you be just an enduring public company? And that may mean 50 billion of market And that may mean 50 billion of market And that may mean 50 billion of market cap. It may mean a 100red billion of cap. It may mean a 100red billion of cap. It may mean a 100red billion of market cap. It really depends based on market cap. It really depends based on market cap.

It really depends based on the stage. But really it's big idea the stage. But really it's big idea the stage. But really it's big idea first and then is the market absolutely first and then is the market absolutely first and then is the market absolutely yanking you into that giant market. yanking you into that giant market. yanking you into that giant market. Right? Do you feel that market pull such Right? Do you feel that market pull such Right? Do you feel that market pull such that that revenue curve and subsequently that that revenue curve and subsequently that that revenue curve and subsequently down the line that earnings path is down the line that earnings path is down the line that earnings path is really achievable? And so what you need really achievable? And so what you need really achievable?

And so what you need to really believe is like take this 50 to really believe is like take this 50 to really believe is like take this 50 million AR 5 billion post type company, million AR 5 billion post type company, million AR 5 billion post type company, right? You need to believe that someday right? You need to believe that someday right? You need to believe that someday you can get to 5 billion of revenue with you can get to 5 billion of revenue with you can get to 5 billion of revenue with 30% margin minimum growing really fast. 30% margin minimum growing really fast. 30% margin minimum growing really fast. So what does that mean? I better believe So what does that mean? I better believe So what does that mean? I better believe there's 50 billion of revenue to go get. there's 50 billion of revenue to go get. there's 50 billion of revenue to go get. Sure.

And you also then are saying that Sure. And you also then are saying that Sure. And you also then are saying that risk adjusted that is the best place you risk adjusted that is the best place you risk adjusted that is the best place you believe to put your capital which is believe to put your capital which is believe to put your capital which is where I get stuck. I'm like in an where I get stuck. I'm like in an where I get stuck. I'm like in an ecosystem where there's so much ecosystem where there's so much ecosystem where there's so much opportunity. I understand that you can opportunity. I understand that you can opportunity.

I understand that you can get there, but is that really the best get there, but is that really the best get there, but is that really the best place to put my money over the 10 other place to put my money over the 10 other place to put my money over the 10 other homes where I don't have to double, homes where I don't have to double, homes where I don't have to double, triple, and then do a somersault into triple, and then do a somersault into triple, and then do a somersault into Kenya? Kenya? Kenya? >> Yeah, that's really No, it's really >> Yeah, that's really No, it's really >> Yeah, that's really No, it's really fair. And again, it's it's something we fair. And again, it's it's something we fair. And again, it's it's something we think about a lot. I think the the two think about a lot. I think the the two think about a lot.

I think the the two things you want to consider when it things you want to consider when it things you want to consider when it comes to that, right? And it's one of comes to that, right? And it's one of comes to that, right? And it's one of the reasons why again, we love having a the reasons why again, we love having a the reasons why again, we love having a flexible mandate. we are not tied to flexible mandate. we are not tied to flexible mandate.

we are not tied to just being able to do a series B at 300 just being able to do a series B at 300 just being able to do a series B at 300 post and like that's all we can do is post and like that's all we can do is post and like that's all we can do is because we can have almost this like because we can have almost this like because we can have almost this like rowboat that rows up and down the river rowboat that rows up and down the river rowboat that rows up and down the river and anytime we see something and anytime we see something and anytime we see something opportunistically that we think is the opportunistically that we think is the opportunistically that we think is the best riskadjusted opportunity at that best riskadjusted opportunity at that best riskadjusted opportunity at that moment we can invest and then the second moment we can invest and then the second moment we can invest and then the second thing we're really looking for right thing we're really looking for right thing we're really looking for right take that round as an example and one of take that round as an example and one of take that round as an example and one of the reasons why we go back to this big the reasons why we go back to this big the reasons why we go back to this big idea test is I want to believe that if idea test is I want to believe that if idea test is I want to believe that if that company works that its best days that company works that its best days that company works that its best days are ahead of it and I can continue to are ahead of it and I can continue to are ahead of it and I can continue to invest.

One thing that um Jeff Horing invest. One thing that um Jeff Horing invest. One thing that um Jeff Horing from from inside always says is that you from from inside always says is that you from from inside always says is that you know the the best round is the double know the the best round is the double know the the best round is the double down round. And so by getting access to down round. And so by getting access to down round.

And so by getting access to that company at a certain stage if I that company at a certain stage if I that company at a certain stage if I think it has a shot at being a hundred think it has a shot at being a hundred think it has a shot at being a hundred billion dollar company that round may billion dollar company that round may billion dollar company that round may not actually be the best round but it not actually be the best round but it not actually be the best round but it gives me the opportunity to double down gives me the opportunity to double down gives me the opportunity to double down and make an even larger investment where and make an even larger investment where and make an even larger investment where more of my capital is going to be more of my capital is going to be more of my capital is going to be deployed over long periods of time.

And deployed over long periods of time. And deployed over long periods of time. And again, it's important why this market again, it's important why this market again, it's important why this market structure is changing, right? I now structure is changing, right? I now structure is changing, right? I now because companies are staying private because companies are staying private because companies are staying private longer. These platform companies are longer. These platform companies are longer. These platform companies are staying private longer. You have the staying private longer. You have the staying private longer. You have the opportunity to make those bets. opportunity to make those bets. opportunity to make those bets.

Previously, you might not have, but now Previously, you might not have, but now Previously, you might not have, but now we have the opportunity to make those we have the opportunity to make those we have the opportunity to make those kinds of bets. kinds of bets. kinds of bets. >> It's so interesting you said there about >> It's so interesting you said there about >> It's so interesting you said there about the lesson from Jeff Horing about the the lesson from Jeff Horing about the the lesson from Jeff Horing about the value of the double down round being value of the double down round being value of the double down round being such a good place for like value such a good place for like value such a good place for like value accretion or like uh resource deployment accretion or like uh resource deployment accretion or like uh resource deployment in some ways.

I always remember Brian in some ways. I always remember Brian in some ways. I always remember Brian Seaman say we drastically underestimate Seaman say we drastically underestimate Seaman say we drastically underestimate the ease of the next double. And it's the ease of the next double. And it's the ease of the next double. And it's like it's much easier for Harvey to go like it's much easier for Harvey to go like it's much easier for Harvey to go from six to 12 billion than it is a from six to 12 billion than it is a from six to 12 billion than it is a company to go from zero to six billion. company to go from zero to six billion. company to go from zero to six billion. >> That's really freaking hard. >> That's really freaking hard. >> That's really freaking hard. >> Yeah. >> Yeah. >> Yeah.

>> And I I really always remember that >> And I I really always remember that >> And I I really always remember that actually and it impacts a lot of how I actually and it impacts a lot of how I actually and it impacts a lot of how I think about selling. think about selling. think about selling. >> Yeah. There's actually a stat around >> Yeah. There's actually a stat around >> Yeah. There's actually a stat around this that I love. We have this chart this that I love. We have this chart this that I love. We have this chart internally um which just shows at each internally um which just shows at each internally um which just shows at each market cap band the percentage of market cap band the percentage of market cap band the percentage of companies that 10x. companies that 10x. companies that 10x.

And the counterintuitive thing is as you And the counterintuitive thing is as you And the counterintuitive thing is as you go up those bands the percentage go up those bands the percentage go up those bands the percentage increases. So from a10 to hundred increases. So from a10 to hundred increases. So from a10 to hundred billion valuation I have a better shot billion valuation I have a better shot billion valuation I have a better shot at picking a 10x not like a better at picking a 10x not like a better at picking a 10x not like a better return a 10x than I did in the prior return a 10x than I did in the prior return a 10x than I did in the prior band. band. band.

>> I just again I want to go back to the >> I just again I want to go back to the >> I just again I want to go back to the the fascinating statement that you said the fascinating statement that you said the fascinating statement that you said there like number one is market size. We there like number one is market size. We there like number one is market size. We need gigantic markets. Do we need need gigantic markets. Do we need need gigantic markets. Do we need gigantic markets over the best gigantic markets over the best gigantic markets over the best immediately incredible founders? I know immediately incredible founders? I know immediately incredible founders?

I know that's a really shitty question to ask that's a really shitty question to ask that's a really shitty question to ask and forgive me for it, but I've actually and forgive me for it, but I've actually and forgive me for it, but I've actually learned that a good founder in a [ __ ] learned that a good founder in a [ __ ] learned that a good founder in a [ __ ] great market almost trumps a great great market almost trumps a great great market almost trumps a great founder in an average market. founder in an average market. founder in an average market. >> Yeah. No, I think the founder is >> Yeah. No, I think the founder is >> Yeah. No, I think the founder is incredibly important. Right. You go back incredibly important. Right. You go back incredibly important. Right. You go back to the example of data bricks, right? to the example of data bricks, right?

to the example of data bricks, right? Most founders in that situation, they Most founders in that situation, they Most founders in that situation, they would have been handed well, not handed, would have been handed well, not handed, would have been handed well, not handed, they would have built an incredible they would have built an incredible they would have built an incredible company in that first wave, but maybe company in that first wave, but maybe company in that first wave, but maybe they wouldn't have found their way to they wouldn't have found their way to they wouldn't have found their way to wave two and three and four. And it's wave two and three and four. And it's wave two and three and four.

And it's again it's why we like this type of again it's why we like this type of again it's why we like this type of company that we call a platform company, company that we call a platform company, company that we call a platform company, right? Which is the has shown the right? Which is the has shown the right? Which is the has shown the ability to skip TAMs to have multiple ability to skip TAMs to have multiple ability to skip TAMs to have multiple TAMs over time. And I think that founder TAMs over time. And I think that founder TAMs over time. And I think that founder is tied to the market, you know, is tied is tied to the market, you know, is tied is tied to the market, you know, is tied to that market dynamic. And they're to that market dynamic. And they're to that market dynamic.

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And they're they're equally important, but market they're equally important, but market they're equally important, but market size is always first. A great founder in size is always first. A great founder in size is always first. A great founder in a small market with a wedge that is not a small market with a wedge that is not a small market with a wedge that is not easily able to expand, I think, will easily able to expand, I think, will easily able to expand, I think, will build an incredible business. But build an incredible business. But build an incredible business. But without having that core market and that without having that core market and that without having that core market and that core trend, it's hard to get to 100 core trend, it's hard to get to 100 core trend, it's hard to get to 100 billion, right? Right? Like you could be billion, right? Right?

Like you could be billion, right? Right? Like you could be in this niche area that's very hard to in this niche area that's very hard to in this niche area that's very hard to expand. It's really easy to get an act expand. It's really easy to get an act expand. It's really easy to get an act one but hard to get the act two and the one but hard to get the act two and the one but hard to get the act two and the act three and the act four and to build act three and the act four and to build act three and the act four and to build that enduring company right you see it that enduring company right you see it that enduring company right you see it with SAS today. You have to have the act with SAS today. You have to have the act with SAS today.

You have to have the act two and the act three and the act four two and the act three and the act four two and the act three and the act four and those things that's why they go and those things that's why they go and those things that's why they go really in tandem because of the really in tandem because of the really in tandem because of the expansion of TAMs and outcome sizes. Can expansion of TAMs and outcome sizes. Can expansion of TAMs and outcome sizes. Can you be thoroughly elastic on entry price you be thoroughly elastic on entry price you be thoroughly elastic on entry price even at the real growth stage or does even at the real growth stage or does even at the real growth stage or does price elasticity constrain significantly price elasticity constrain significantly price elasticity constrain significantly with increasing enterprise value? with increasing enterprise value?

with increasing enterprise value? >> Ultimately price always does matter, >> Ultimately price always does matter, >> Ultimately price always does matter, right? I think some folks will say price right? I think some folks will say price right? I think some folks will say price doesn't matter. doesn't matter. doesn't matter. >> I think price does matter but I think it >> I think price does matter but I think it >> I think price does matter but I think it matters least. matters least. matters least. You of course could make the argument of You of course could make the argument of You of course could make the argument of oh Lucas, well you do it five, why not oh Lucas, well you do it five, why not oh Lucas, well you do it five, why not six or seven or eight or 9 or 10 six or seven or eight or 9 or 10 six or seven or eight or 9 or 10 billion? What if it was 20 billion? What billion?

What if it was 20 billion? What billion? What if it was 20 billion? What if it was 30 billion? There does come a if it was 30 billion? There does come a if it was 30 billion? There does come a delineation point where you feel like delineation point where you feel like delineation point where you feel like the returns are going to erode such that the returns are going to erode such that the returns are going to erode such that you would pass on an opportunity. But you would pass on an opportunity. But you would pass on an opportunity.

But I'd say by and large if you're the one I'd say by and large if you're the one I'd say by and large if you're the one instigating these rounds and you're the instigating these rounds and you're the instigating these rounds and you're the one that's preempting these rounds, you one that's preempting these rounds, you one that's preempting these rounds, you can kind of help figure out what the can kind of help figure out what the can kind of help figure out what the right price is for a company at any right price is for a company at any right price is for a company at any given moment. And I do think you want to given moment. And I do think you want to given moment.

And I do think you want to think about it last because again these think about it last because again these think about it last because again these generational companies, it's almost generational companies, it's almost generational companies, it's almost never too late for them, right? I agree never too late for them, right? I agree never too late for them, right? I agree with that that we have a very kind of with that that we have a very kind of with that that we have a very kind of clear litmus test which will make us clear litmus test which will make us clear litmus test which will make us make many mistakes and which is why we make many mistakes and which is why we make many mistakes and which is why we should change it immediately. But it's should change it immediately. But it's should change it immediately.

But it's like when we think about our entry price like when we think about our entry price like when we think about our entry price is true. We think about our entry price. is true. We think about our entry price. is true. We think about our entry price. Do we think that we are able to 3x that Do we think that we are able to 3x that Do we think that we are able to 3x that entry price within the next fundraising entry price within the next fundraising entry price within the next fundraising round? And so if the company says hey round? And so if the company says hey round?

And so if the company says hey we're going to be at we're going to go we're going to be at we're going to go we're going to be at we're going to go from 1 to 10 million by the end of this from 1 to 10 million by the end of this from 1 to 10 million by the end of this year and because of that we're going to year and because of that we're going to year and because of that we're going to be able to raise at 350. Great. Well be able to raise at 350. Great. Well be able to raise at 350. Great. Well we're paying 70 for the A. I can totally we're paying 70 for the A. I can totally we're paying 70 for the A. I can totally see my 3x there. Or it's like, well, see my 3x there. Or it's like, well, see my 3x there.

Or it's like, well, actually, we're only going from one to actually, we're only going from one to actually, we're only going from one to four because we're a slow enterprise four because we're a slow enterprise four because we're a slow enterprise sales cycle, but we're paying 150 for sales cycle, but we're paying 150 for sales cycle, but we're paying 150 for this incredibly hot a one to four. I'm this incredibly hot a one to four. I'm this incredibly hot a one to four. I'm not raising at 300 if that's the case. not raising at 300 if that's the case. not raising at 300 if that's the case. >> Right. >> Right. >> Right. >> [ __ ] I'm probably raising a flat round. >> [ __ ] I'm probably raising a flat round. >> [ __ ] I'm probably raising a flat round. >> Correct. Maybe no. That's how we think >> Correct. Maybe no. That's how we think >> Correct. Maybe no. That's how we think about it.

Do you have any internal about it. Do you have any internal about it.

Do you have any internal monikers or frameworks for like monikers or frameworks for like monikers or frameworks for like >> I think the more simplistic way that we >> I think the more simplistic way that we >> I think the more simplistic way that we think about it and again this is not a think about it and again this is not a think about it and again this is not a hard and fast rule and it's more hard and fast rule and it's more hard and fast rule and it's more qualitative than anything is if I invest qualitative than anything is if I invest qualitative than anything is if I invest in this round at this price and the in this round at this price and the in this round at this price and the company executes do I want to put more company executes do I want to put more company executes do I want to put more at a higher price. at a higher price. at a higher price. That's the litmus test.

It's to say all That's the litmus test. It's to say all That's the litmus test. It's to say all right say I invest in a company at 5 right say I invest in a company at 5 right say I invest in a company at 5 billion and it does super well this billion and it does super well this billion and it does super well this year. Is this a big enough idea? Is this year. Is this a big enough idea? Is this year. Is this a big enough idea? Is this generational enough? Is this generational enough? Is this generational enough? Is this transformational enough? Is the founder transformational enough? Is the founder transformational enough?

Is the founder amazing enough that if in six months amazing enough that if in six months amazing enough that if in six months they wake up and say they want to raise they wake up and say they want to raise they wake up and say they want to raise it 10 that I'm gonna want to do that? it 10 that I'm gonna want to do that? it 10 that I'm gonna want to do that?

>> I think it was Henry Allen Bogen that >> I think it was Henry Allen Bogen that >> I think it was Henry Allen Bogen that said once that he wants to invest as said once that he wants to invest as said once that he wants to invest as much money as possible as the company much money as possible as the company much money as possible as the company becomes more expensive which is one of becomes more expensive which is one of becomes more expensive which is one of those kind of counterintuitive those kind of counterintuitive those kind of counterintuitive statements. Do you want to kind of spray statements. Do you want to kind of spray statements. Do you want to kind of spray early? And spray is a derogatory term. I early? And spray is a derogatory term. I early? And spray is a derogatory term.

I don't mean that rudely, but like don't mean that rudely, but like don't mean that rudely, but like constrain capital effectively and then constrain capital effectively and then constrain capital effectively and then double down very aggressively or do you double down very aggressively or do you double down very aggressively or do you want to aggressively get ownership and want to aggressively get ownership and want to aggressively get ownership and then focus on constraining as time goes then focus on constraining as time goes then focus on constraining as time goes on? on? on? >> Yeah, we're we're much more the latter >> Yeah, we're we're much more the latter >> Yeah, we're we're much more the latter and I think there are two there are two and I think there are two there are two and I think there are two there are two dynamics around this. One is our view is dynamics around this.

One is our view is dynamics around this. One is our view is there are very few companies that there are very few companies that there are very few companies that generate the disproportionate value in generate the disproportionate value in generate the disproportionate value in technology. Right? If you look at the technology. Right? If you look at the technology. Right? If you look at the private markets today, take the whole private markets today, take the whole private markets today, take the whole private market ecosystem, private market ecosystem, private market ecosystem, 20 companies gener have generated 80% of 20 companies gener have generated 80% of 20 companies gener have generated 80% of the enterprise value. 20 companies 80% the enterprise value. 20 companies 80% the enterprise value.

20 companies 80% of the enterprise value of all the of the enterprise value of all the of the enterprise value of all the private companies that exist in the private companies that exist in the private companies that exist in the world. And four companies, right, have world. And four companies, right, have world. And four companies, right, have generated 65% of the enterprise value. generated 65% of the enterprise value. generated 65% of the enterprise value. Four companies. And so what really Four companies. And so what really Four companies.

And so what really matters is being in those companies, matters is being in those companies, matters is being in those companies, those 20 platform companies that are those 20 platform companies that are those 20 platform companies that are generating the disproportionate amount generating the disproportionate amount generating the disproportionate amount of value. And then your next question is of value. And then your next question is of value.

And then your next question is all right well how like this wonderful all right well how like this wonderful all right well how like this wonderful framework like we all would love to be framework like we all would love to be framework like we all would love to be in all of these platform companies but in all of these platform companies but in all of these platform companies but like how and the answer is from our view like how and the answer is from our view like how and the answer is from our view you can't do this spray prey at the you can't do this spray prey at the you can't do this spray prey at the early stage or the early growth stage early stage or the early growth stage early stage or the early growth stage the reason why is you may be in the the reason why is you may be in the the reason why is you may be in the wrong horse or you may be in the wrong wrong horse or you may be in the wrong wrong horse or you may be in the wrong market and you may be investing your market and you may be investing your market and you may be investing your time wrong because there are very few time wrong because there are very few time wrong because there are very few companies we need to make very few companies we need to make very few companies we need to make very few investments even at the even at the investments even at the even at the investments even at the even at the early growth stage or the growth stage early growth stage or the growth stage early growth stage or the growth stage we can't afford to be in the wrong horse we can't afford to be in the wrong horse we can't afford to be in the wrong horse >> I get you but actually we I'm not asking >> I get you but actually we I'm not asking >> I get you but actually we I'm not asking you about yours you about yours you about yours But we see a world of competitive But we see a world of competitive But we see a world of competitive investing.

Andre is in, you know, investing. Andre is in, you know, investing. Andre is in, you know, competitors consistently. There are many competitors consistently. There are many competitors consistently. There are many people who are in many companies where people who are in many companies where people who are in many companies where they directly compete. You can actually they directly compete. You can actually they directly compete. You can actually afford to be in the wrong horse today afford to be in the wrong horse today afford to be in the wrong horse today and still do the next horse. I think you and still do the next horse. I think you and still do the next horse. I think you can, but it definitely makes your job can, but it definitely makes your job can, but it definitely makes your job harder. Yes. Right. I think um you want harder. Yes. Right. I think um you want harder. Yes.

Right. I think um you want to to to you want to make your job easy as easy you want to make your job easy as easy you want to make your job easy as easy as possible and not put up the barriers as possible and not put up the barriers as possible and not put up the barriers in ways to being able to win to win a in ways to being able to win to win a in ways to being able to win to win a new investment. But I agree with you at new investment. But I agree with you at new investment. But I agree with you at at scale when companies become these at scale when companies become these at scale when companies become these platform companies, right, which is our platform companies, right, which is our platform companies, right, which is our style of investing. style of investing. style of investing.

>> Often times it's almost like buying a >> Often times it's almost like buying a >> Often times it's almost like buying a pseudo public stock in many ways. As a pseudo public stock in many ways. As a pseudo public stock in many ways. As a public market investor, I could own public market investor, I could own public market investor, I could own Google and Meta. as a private market Google and Meta. as a private market Google and Meta. as a private market investor at the very earliest stages or investor at the very earliest stages or investor at the very earliest stages or the early growth stage, should I be the early growth stage, should I be the early growth stage, should I be investing in like two series B's that investing in like two series B's that investing in like two series B's that are exactly directly competitive? That are exactly directly competitive?

That are exactly directly competitive? That feels really counterintuitive, right? feels really counterintuitive, right? feels really counterintuitive, right? You probably don't want to do that one You probably don't want to do that one You probably don't want to do that one just because you're making a bet that's just because you're making a bet that's just because you're making a bet that's directly directly competing. But at the directly directly competing. But at the directly directly competing. But at the growth stage, when you get these growth stage, when you get these growth stage, when you get these platform companies, maybe they didn't platform companies, maybe they didn't platform companies, maybe they didn't even start by being competitive, but even start by being competitive, but even start by being competitive, but they grew into it over time.

when they grew into it over time. when they grew into it over time. when founders come to you and they're like, founders come to you and they're like, founders come to you and they're like, "I'm how dare you?" Like, it started off "I'm how dare you?" Like, it started off "I'm how dare you?" Like, it started off as a pillow company and now it's doing as a pillow company and now it's doing as a pillow company and now it's doing enterprise payments. I how how am I to enterprise payments. I how how am I to enterprise payments. I how how am I to know? know? know? >> And listen, that's part of the game. And >> And listen, that's part of the game. And >> And listen, that's part of the game.

And um as a founder, I completely I um as a founder, I completely I um as a founder, I completely I completely empathize and understand completely empathize and understand completely empathize and understand that, right? I can understand how that that, right? I can understand how that that, right? I can understand how that would be, you know, a really tricky would be, you know, a really tricky would be, you know, a really tricky situation. From our perspective, it's situation. From our perspective, it's situation.

From our perspective, it's when you're investing in large markets, when you're investing in large markets, when you're investing in large markets, often times you are going to end up in often times you are going to end up in often times you are going to end up in assets that compete because they assets that compete because they assets that compete because they naturally expand TAMs. A great example naturally expand TAMs. A great example naturally expand TAMs. A great example of this is I think we were the only of this is I think we were the only of this is I think we were the only private investor that was invested in private investor that was invested in private investor that was invested in Snowflake and Data Bricks when they were Snowflake and Data Bricks when they were Snowflake and Data Bricks when they were both private. They started off in both private.

They started off in both private. They started off in completely different areas, right? Data completely different areas, right? Data completely different areas, right? Data Bricks didn't have a data warehousing Bricks didn't have a data warehousing Bricks didn't have a data warehousing product and Snowflake didn't really do a product and Snowflake didn't really do a product and Snowflake didn't really do a lot of ELT. It was mostly built around lot of ELT. It was mostly built around lot of ELT. It was mostly built around the ecosystem. They grew together and the ecosystem. They grew together and the ecosystem.

They grew together and they we weren't invested when they were, they we weren't invested when they were, they we weren't invested when they were, you know, starting to compete because you know, starting to compete because you know, starting to compete because Snowflake went public a lot earlier. But Snowflake went public a lot earlier. But Snowflake went public a lot earlier. But at the same time, that happens in big at the same time, that happens in big at the same time, that happens in big markets. It's so funny you said that you markets. It's so funny you said that you markets. It's so funny you said that you the enterprise value I think 65% is done the enterprise value I think 65% is done the enterprise value I think 65% is done by four companies or created by four by four companies or created by four by four companies or created by four companies.

I tweeted not too long ago companies. I tweeted not too long ago companies.

I tweeted not too long ago that basically unless you're an that basically unless you're an that basically unless you're an anthropic open AI cursor lovable open anthropic open AI cursor lovable open anthropic open AI cursor lovable open evidence carvey you name your like evidence carvey you name your like evidence carvey you name your like you're irrelevant if you're not in them you're irrelevant if you're not in them you're irrelevant if you're not in them in venture and naturally every in venture and naturally every in venture and naturally every irrelevant venture investor came out of irrelevant venture investor came out of irrelevant venture investor came out of the woodwork and said how dare you Harry the woodwork and said how dare you Harry the woodwork and said how dare you Harry uh I'm very irrelevant um I promise um uh I'm very irrelevant um I promise um uh I'm very irrelevant um I promise um and it just made me laugh but I did and it just made me laugh but I did and it just made me laugh but I did understand the nuance of you don't understand the nuance of you don't understand the nuance of you don't actually have to be in them if your fund actually have to be in them if your fund actually have to be in them if your fund size is constrained if you've got a size is constrained if you've got a size is constrained if you've got a hund00 million seed fund and you have a hund00 million seed fund and you have a hund00 million seed fund and you have a $3 billion outcome.

It's still a great $3 billion outcome. It's still a great $3 billion outcome. It's still a great business. business. business. >> I I do. So, and so I wanted to ask you >> I I do. So, and so I wanted to ask you >> I I do.

So, and so I wanted to ask you when you think about mega funds, which when you think about mega funds, which when you think about mega funds, which we see more and more of, we see more and more of, we see more and more of, >> do you think they will be able to >> do you think they will be able to >> do you think they will be able to produce the venture like returns that we produce the venture like returns that we produce the venture like returns that we see with early stage funds given the see with early stage funds given the see with early stage funds given the outcome sizes or actually we just have a outcome sizes or actually we just have a outcome sizes or actually we just have a different LP profile? different LP profile? different LP profile?

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>> Yeah, I mean I think I would separate >> Yeah, I mean I think I would separate >> Yeah, I mean I think I would separate the two asset classes almost in some the two asset classes almost in some the two asset classes almost in some way, right? Venture and growth in many way, right? Venture and growth in many way, right? Venture and growth in many ways, right? They've we've almost ways, right? They've we've almost ways, right? They've we've almost developed completely independently and developed completely independently and developed completely independently and separately. Obviously, there are firms separately. Obviously, there are firms separately. Obviously, there are firms that do both. There are firms that do that do both. There are firms that do that do both. There are firms that do both very well. If I was a venture fund both very well. If I was a venture fund both very well.

If I was a venture fund staring down the barrel of a $3 billion staring down the barrel of a $3 billion staring down the barrel of a $3 billion venture fund, I think that's a tough venture fund, I think that's a tough venture fund, I think that's a tough putt. That's a tough battle to be a part putt. That's a tough battle to be a part putt. That's a tough battle to be a part of. of. of. >> What do you What do you mean by that? If >> What do you What do you mean by that? If >> What do you What do you mean by that?

If you're in one, you're in one, you're in one, >> I mean, if you are a venture fund that >> I mean, if you are a venture fund that >> I mean, if you are a venture fund that is staring down the barrel of having to is staring down the barrel of having to is staring down the barrel of having to deploy $3 billion, I think that is hard deploy $3 billion, I think that is hard deploy $3 billion, I think that is hard because again, at the early stage, it is because again, at the early stage, it is because again, at the early stage, it is hard to capture disproportionate hard to capture disproportionate hard to capture disproportionate ownership in the few companies that ownership in the few companies that ownership in the few companies that actually generate all of that liquidity. actually generate all of that liquidity. actually generate all of that liquidity.

If you're a small a small venture fund, If you're a small a small venture fund, If you're a small a small venture fund, I think it's super possible in today's I think it's super possible in today's I think it's super possible in today's world. You don't actually have to be in world. You don't actually have to be in world. You don't actually have to be in you don't have to catch the seed of you don't have to catch the seed of you don't have to catch the seed of SpaceX. you'd really like to because SpaceX. you'd really like to because SpaceX.

you'd really like to because those are the only the platform those are the only the platform those are the only the platform companies generate liquidity, but at the companies generate liquidity, but at the companies generate liquidity, but at the end of the day, like you can get by with end of the day, like you can get by with end of the day, like you can get by with not capturing all of the great outcomes. not capturing all of the great outcomes. not capturing all of the great outcomes. If you have a $3 billion venture fund, If you have a $3 billion venture fund, If you have a $3 billion venture fund, the math is really hard, right? You have the math is really hard, right? You have the math is really hard, right? You have to capture a lot of those. The growth to capture a lot of those. The growth to capture a lot of those.

The growth funds are growth funds are a little bit funds are growth funds are a little bit funds are growth funds are a little bit different math. But I think just go back different math. But I think just go back different math. But I think just go back to your question about, you know, can to your question about, you know, can to your question about, you know, can these can a $5 billion growth fund scale these can a $5 billion growth fund scale these can a $5 billion growth fund scale and work? The answer is yes. The reason and work? The answer is yes. The reason and work? The answer is yes. The reason why is the market's changing in two why is the market's changing in two why is the market's changing in two different ways. change number one, these different ways. change number one, these different ways. change number one, these companies are staying private longer.

companies are staying private longer. companies are staying private longer. They're staying they're getting bigger They're staying they're getting bigger They're staying they're getting bigger while they're private. There are more while they're private. There are more while they're private. There are more opportunities to invest over time. So opportunities to invest over time. So opportunities to invest over time. So now where 10 years ago, you couldn't put now where 10 years ago, you couldn't put now where 10 years ago, you couldn't put a billion dollars in a company. Now you a billion dollars in a company. Now you a billion dollars in a company. Now you can invest a billion dollars in any can invest a billion dollars in any can invest a billion dollars in any given round. If I invest a billion given round. If I invest a billion given round.

If I invest a billion dollars and I 10x that billion dollars, dollars and I 10x that billion dollars, dollars and I 10x that billion dollars, that's a 2x on a $5 billion fund. Now I that's a 2x on a $5 billion fund. Now I that's a 2x on a $5 billion fund. Now I need to be concentrated to make that need to be concentrated to make that need to be concentrated to make that happen, right? And I think again that's happen, right? And I think again that's happen, right? And I think again that's why we go back to our strategy. Few why we go back to our strategy. Few why we go back to our strategy. Few investments, big checks. You have to investments, big checks. You have to investments, big checks. You have to have that type of discipline to make have that type of discipline to make have that type of discipline to make those fund sizes work. The spray and those fund sizes work.

The spray and those fund sizes work. The spray and prey does not work. But you can you can prey does not work. But you can you can prey does not work. But you can you can absolutely make it work. And then I absolutely make it work. And then I absolutely make it work. And then I think the second dynamic that's think the second dynamic that's think the second dynamic that's different is the outcomes are bigger different is the outcomes are bigger different is the outcomes are bigger now. The outcomes are bigger now than now. The outcomes are bigger now than now. The outcomes are bigger now than they used to be. In the SAS wave, I they used to be. In the SAS wave, I they used to be.

In the SAS wave, I think it would have been really hard to think it would have been really hard to think it would have been really hard to make that fund size work because SAS make that fund size work because SAS make that fund size work because SAS you're constrained. The largest SAS you're constrained. The largest SAS you're constrained. The largest SAS company in the world that's independent company in the world that's independent company in the world that's independent outside of Microsoft and the outside of Microsoft and the outside of Microsoft and the hyperscalers, Salesforce, right? hyperscalers, Salesforce, right? hyperscalers, Salesforce, right?

Salesforce, Workday, Service Now, those Salesforce, Workday, Service Now, those Salesforce, Workday, Service Now, those are like a couple hundred billion are like a couple hundred billion are like a couple hundred billion dollars of market cap, right? So, it's dollars of market cap, right? So, it's dollars of market cap, right? So, it's going to be hard in that world. But in going to be hard in that world. But in going to be hard in that world.

But in an AI world, if we actually think that an AI world, if we actually think that an AI world, if we actually think that we're augmenting labor, if we think that we're augmenting labor, if we think that we're augmenting labor, if we think that we can address a lot of these really big we can address a lot of these really big we can address a lot of these really big markets, if you move from human inputs markets, if you move from human inputs markets, if you move from human inputs to tokens, to tokens, to tokens, then you're going to have much bigger then you're going to have much bigger then you're going to have much bigger outcomes and the math works. Do you outcomes and the math works. Do you outcomes and the math works.

Do you think in a world of vertical SAS or think in a world of vertical SAS or think in a world of vertical SAS or sorry in a world of mega funds with $5 sorry in a world of mega funds with $5 sorry in a world of mega funds with $5 billion plus funds which are several now billion plus funds which are several now billion plus funds which are several now vertical SAS is no longer an investable vertical SAS is no longer an investable vertical SAS is no longer an investable category just because the outcome sizes category just because the outcome sizes category just because the outcome sizes will not be enough to generate the mega will not be enough to generate the mega will not be enough to generate the mega outcomes needed. I mean I listen outcomes needed. I mean I listen outcomes needed.

I mean I listen vertical SAS I think you could talk vertical SAS I think you could talk vertical SAS I think you could talk about it a lot of different ways about it a lot of different ways about it a lot of different ways constraint TAM AI risk all kinds of constraint TAM AI risk all kinds of constraint TAM AI risk all kinds of stuff they're still great businesses stuff they're still great businesses stuff they're still great businesses today people are people have made a lot today people are people have made a lot today people are people have made a lot of money in vertical software over time of money in vertical software over time of money in vertical software over time think about insight right they've had think about insight right they've had think about insight right they've had incredible exits in vertical software incredible exits in vertical software incredible exits in vertical software over time multi-billion dollar exits in over time multi-billion dollar exits in over time multi-billion dollar exits in today's world if you have a big fund I today's world if you have a big fund I today's world if you have a big fund I don't think that's where you should be don't think that's where you should be don't think that's where you should be focused I think you should be focused on focused I think you should be focused on focused I think you should be focused on the absolute mega outcomes the platform the absolute mega outcomes the platform the absolute mega outcomes the platform companies that are going to generate companies that are going to generate companies that are going to generate that disproportionate return and you're that disproportionate return and you're that disproportionate return and you're actually going to get liquidity out of.

actually going to get liquidity out of. actually going to get liquidity out of. >> Don't laugh. What is an attractive >> Don't laugh. What is an attractive >> Don't laugh. What is an attractive enough upside scenario to get you enough upside scenario to get you enough upside scenario to get you excited? You know, we always hear an excited? You know, we always hear an excited? You know, we always hear an early stage in my business. Oh, it needs early stage in my business. Oh, it needs early stage in my business. Oh, it needs to be a fund returner. to be a fund returner. to be a fund returner. >> Sure. >> Sure. >> Sure. >> What is attractive enough for you? Like >> What is attractive enough for you? Like >> What is attractive enough for you? Like Revolute, I think, is a phenomenal Revolute, I think, is a phenomenal Revolute, I think, is a phenomenal company.

I'd love to be ambassador at 75 company. I'd love to be ambassador at 75 company. I'd love to be ambassador at 75 billion. I'd love to be and I think billion. I'd love to be and I think billion. I'd love to be and I think there's a clear pathway to 250 billion. there's a clear pathway to 250 billion. there's a clear pathway to 250 billion. >> For sure. >> For sure. >> For sure. >> Is that 3x enough to be exciting? >> Is that 3x enough to be exciting? >> Is that 3x enough to be exciting? >> No. A 3x is not enough to be exciting. >> No. A 3x is not enough to be exciting. >> No. A 3x is not enough to be exciting. And the math is really simple, right? And the math is really simple, right? And the math is really simple, right?

Say, say I'm a fund and I'm CO2 and I Say, say I'm a fund and I'm CO2 and I Say, say I'm a fund and I'm CO2 and I want to make a 3x net return for my want to make a 3x net return for my want to make a 3x net return for my investors, which I think is which I investors, which I think is which I investors, which I think is which I think is sort of the baseline for what think is sort of the baseline for what think is sort of the baseline for what people would say is like a top quartile people would say is like a top quartile people would say is like a top quartile return and people get really excited return and people get really excited return and people get really excited about 3x net return for a fund. You about 3x net return for a fund. You about 3x net return for a fund.

You know, 25% net IR, something around those know, 25% net IR, something around those know, 25% net IR, something around those bands. I'm going to have some things bands. I'm going to have some things bands. I'm going to have some things where I swing and I miss. And say I have where I swing and I miss. And say I have where I swing and I miss. And say I have a 1x, I need a 5x on the other side of a 1x, I need a 5x on the other side of a 1x, I need a 5x on the other side of that. Heaven forbid I have a loss rate. that. Heaven forbid I have a loss rate. that. Heaven forbid I have a loss rate. I have a loss and I have a zero. I need I have a loss and I have a zero. I need I have a loss and I have a zero. I need a six. We obviously really try to avoid a six. We obviously really try to avoid a six. We obviously really try to avoid those, right? If I have a two, I need a those, right?

If I have a two, I need a those, right? If I have a two, I need a four. So for me, I need to see a a a four. So for me, I need to see a a a four. So for me, I need to see a a a steady case where you can get that 3x, steady case where you can get that 3x, steady case where you can get that 3x, but I really need to believe that if the but I really need to believe that if the but I really need to believe that if the company 3xes, I want to put more money company 3xes, I want to put more money company 3xes, I want to put more money in because it can 3x again. And I think in because it can 3x again. And I think in because it can 3x again.

And I think this is a really critical thing that a this is a really critical thing that a this is a really critical thing that a lot of folks end up missing over time is lot of folks end up missing over time is lot of folks end up missing over time is ultimately I need to imagine a case ultimately I need to imagine a case ultimately I need to imagine a case where after I've made my 3x somebody where after I've made my 3x somebody where after I've made my 3x somebody else thinks they can make their 3x else thinks they can make their 3x else thinks they can make their 3x because otherwise one I'm not going to because otherwise one I'm not going to because otherwise one I'm not going to get those 6x pluses that I'm going to get those 6x pluses that I'm going to get those 6x pluses that I'm going to need in my fund but two the company's need in my fund but two the company's need in my fund but two the company's not going to exit.

I have to imagine not going to exit. I have to imagine not going to exit. I have to imagine this is why the big idea have being in this is why the big idea have being in this is why the big idea have being in big ideas really matters. Somebody's got big ideas really matters. Somebody's got big ideas really matters. Somebody's got to sit on the other side of that stock. to sit on the other side of that stock. to sit on the other side of that stock. I have to be able to walk down the I have to be able to walk down the I have to be able to walk down the hallway to the folks that operate on our hallway to the folks that operate on our hallway to the folks that operate on our public side and say, "Do you want to buy public side and say, "Do you want to buy public side and say, "Do you want to buy this stock? Do you want to buy this this stock? Do you want to buy this this stock?

Do you want to buy this stock more than all the other stock more than all the other stock more than all the other opportunities that you have?" And so opportunities that you have?" And so opportunities that you have?" And so every investment I make, that is the every investment I make, that is the every investment I make, that is the rigor and the framework that I use is rigor and the framework that I use is rigor and the framework that I use is someday is my public counterpart going someday is my public counterpart going someday is my public counterpart going to want to own this stock over to want to own this stock over to want to own this stock over everything else in their book. Is or at everything else in their book. Is or at everything else in their book.

Is or at least is there a chance with the least is there a chance with the least is there a chance with the extension of those private markets and extension of those private markets and extension of those private markets and the outcome sizes and your entry point the outcome sizes and your entry point the outcome sizes and your entry point as we said can be flexible, but you know as we said can be flexible, but you know as we said can be flexible, but you know the 300 to 5 billion is very standard. the 300 to 5 billion is very standard. the 300 to 5 billion is very standard. But I know it can go much higher. Given But I know it can go much higher. Given But I know it can go much higher.

Given that delay in private public market that delay in private public market that delay in private public market entry that we we've seen from private entry that we we've seen from private entry that we we've seen from private companies, you have the chance to sell a companies, you have the chance to sell a companies, you have the chance to sell a lot more than you used to. How do you lot more than you used to. How do you lot more than you used to. How do you think about taking advantage of think about taking advantage of think about taking advantage of secondary markets pre-going public and secondary markets pre-going public and secondary markets pre-going public and doing great returns for your investors? doing great returns for your investors? doing great returns for your investors? >> Yeah. Um it's it's certainly an option >> Yeah. Um it's it's certainly an option >> Yeah.

Um it's it's certainly an option for liquidity now, right? A lot of for liquidity now, right? A lot of for liquidity now, right? A lot of folks, especially the early stage funds folks, especially the early stage funds folks, especially the early stage funds that have been in companies for a really that have been in companies for a really that have been in companies for a really long time, long time, long time, >> um, are taking advantage of this and I >> um, are taking advantage of this and I >> um, are taking advantage of this and I think rightfully so. And again, I think think rightfully so. And again, I think think rightfully so.

And again, I think it's why even if you're an early stage it's why even if you're an early stage it's why even if you're an early stage fund, you this is a great style of fund, you this is a great style of fund, you this is a great style of investing and it's the type of company investing and it's the type of company investing and it's the type of company that you want to be in because it's the that you want to be in because it's the that you want to be in because it's the only type of company that can get access only type of company that can get access only type of company that can get access to liquidity whether it's private or to liquidity whether it's private or to liquidity whether it's private or public. When you have doubled down and public. When you have doubled down and public.

When you have doubled down and it has been a mistake, what did you not it has been a mistake, what did you not it has been a mistake, what did you not see that you wish you'd seen? And you see that you wish you'd seen? And you see that you wish you'd seen? And you don't need to name the company, but don't need to name the company, but don't need to name the company, but >> yeah, of course, I think again it goes >> yeah, of course, I think again it goes >> yeah, of course, I think again it goes back to that very simple principle. It's back to that very simple principle. It's back to that very simple principle. It's the big idea and the multiple products. the big idea and the multiple products. the big idea and the multiple products.

And it's why we're really focused on And it's why we're really focused on And it's why we're really focused on that and why I harp on it literally that and why I harp on it literally that and why I harp on it literally non-stop is we've just overestimated TAM non-stop is we've just overestimated TAM non-stop is we've just overestimated TAM and we've overestimated the ability for and we've overestimated the ability for and we've overestimated the ability for companies to launch multiple products companies to launch multiple products companies to launch multiple products and expand into new TAMs. We're usually and expand into new TAMs. We're usually and expand into new TAMs.

We're usually not getting things wrong on the basis of not getting things wrong on the basis of not getting things wrong on the basis of metrics or the team being good or it metrics or the team being good or it metrics or the team being good or it wasn't growing fast enough. It's really wasn't growing fast enough. It's really wasn't growing fast enough.

It's really that question and it's why we have that question and it's why we have that question and it's why we have applied and really raised the bar on the applied and really raised the bar on the applied and really raised the bar on the type of investing that we do is because type of investing that we do is because type of investing that we do is because of that right it's like where where of that right it's like where where of that right it's like where where we've gone wrong and the nice thing is we've gone wrong and the nice thing is we've gone wrong and the nice thing is we have a you know we tend to have a we have a you know we tend to have a we have a you know we tend to have a very low loss ratio because of the style very low loss ratio because of the style very low loss ratio because of the style of investing that we do but where we've of investing that we do but where we've of investing that we do but where we've gone wrong it's that when we say raise gone wrong it's that when we say raise gone wrong it's that when we say raise the bar the bar the bar the challenge that I have with a lot of the challenge that I have with a lot of the challenge that I have with a lot of companies today is they're like good companies today is they're like good companies today is they're like good enterprise companies okay um but they're enterprise companies okay um but they're enterprise companies okay um but they're they're kind of doubling and tripling at they're kind of doubling and tripling at they're kind of doubling and tripling at 10 20 million in revenue 10 20 million in revenue 10 20 million in revenue What happens to that generation of SAS What happens to that generation of SAS What happens to that generation of SAS companies from 2020 2021 that that are companies from 2020 2021 that that are companies from 2020 2021 that that are good companies good companies good companies >> great companies >> great companies >> great companies >> but >> but >> but well respectfully they're not great well respectfully they're not great well respectfully they're not great companies they're good companies and in companies they're good companies and in companies they're good companies and in a prior cycle they would have been a prior cycle they would have been a prior cycle they would have been funded and they would been funded well funded and they would been funded well funded and they would been funded well but now are you really going to jump out but now are you really going to jump out but now are you really going to jump out of bed for 10 million growing to 25 of bed for 10 million growing to 25 of bed for 10 million growing to 25 million the short answer is I don't know million the short answer is I don't know million the short answer is I don't know I don't know what's going to happen to I don't know what's going to happen to I don't know what's going to happen to those companies I don't know what the those companies I don't know what the those companies I don't know what the terminal value is I don't know what exit terminal value is I don't know what exit terminal value is I don't know what exit pathways are right with private equity pathways are right with private equity pathways are right with private equity in the space that in the place that it's in the space that in the place that it's in the space that in the place that it's in with the public markets where it is.

in with the public markets where it is. in with the public markets where it is. All I know is I have a lot of conviction All I know is I have a lot of conviction All I know is I have a lot of conviction and I see a path in the style of and I see a path in the style of and I see a path in the style of investing that we do. I don't I don't investing that we do. I don't I don't investing that we do. I don't I don't know how to comment on the other part of know how to comment on the other part of know how to comment on the other part of the markets, right? There's this notion the markets, right? There's this notion the markets, right?

There's this notion that like the the triple triple triple that like the the triple triple triple that like the the triple triple triple double double double is dead and these double double double is dead and these double double double is dead and these companies suck and all this stuff. I companies suck and all this stuff. I companies suck and all this stuff. I don't think that's true. There are great don't think that's true. There are great don't think that's true. There are great companies. You can drive real margin companies. You can drive real margin companies. You can drive real margin from them. They make incredible from them. They make incredible from them. They make incredible businesses. It's just not our strategy, businesses. It's just not our strategy, businesses. It's just not our strategy, right? And I think in today's world, the right?

And I think in today's world, the right? And I think in today's world, the reality is in a SAS world, the triple reality is in a SAS world, the triple reality is in a SAS world, the triple triple double double double was a thing. triple double double double was a thing. triple double double double was a thing. It was an incredible metric. These It was an incredible metric. These It was an incredible metric. These businesses were incredibly repeatable, businesses were incredibly repeatable, businesses were incredibly repeatable, very comparable. Now we exist in a world very comparable. Now we exist in a world very comparable.

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Now we exist in a world where if you have a product that the where if you have a product that the where if you have a product that the market likes, it is going to absolutely market likes, it is going to absolutely market likes, it is going to absolutely yank you into that market, right? It's yank you into that market, right? It's yank you into that market, right? It's not going to triple at the earliest not going to triple at the earliest not going to triple at the earliest stages. It is going to scream, right? stages. It is going to scream, right? stages. It is going to scream, right? And I think you re you really see that, And I think you re you really see that, And I think you re you really see that, right? Right. And so those are the right? Right. And so those are the right? Right.

And so those are the companies and again it's not like we companies and again it's not like we companies and again it's not like we think these companies are all bad and think these companies are all bad and think these companies are all bad and this and that. It's just our strategy is this and that. It's just our strategy is this and that. It's just our strategy is to find those and to work with those to find those and to work with those to find those and to work with those companies because that's where we think companies because that's where we think companies because that's where we think the disproportionate returns come from the disproportionate returns come from the disproportionate returns come from and it's the companies that we have an and it's the companies that we have an and it's the companies that we have an advantage working with. You mentioned advantage working with.

You mentioned advantage working with. You mentioned the word margin there and I think why I the word margin there and I think why I the word margin there and I think why I think so many people feel really think so many people feel really think so many people feel really insecure as investors today is because insecure as investors today is because insecure as investors today is because there's so many prizes that are being there's so many prizes that are being there's so many prizes that are being fundamentally questioned whether it's fundamentally questioned whether it's fundamentally questioned whether it's growth rates or rule of 40s or you know growth rates or rule of 40s or you know growth rates or rule of 40s or you know I was always taught that margin I was always taught that margin I was always taught that margin mattered. I walked with my mother around mattered.

I walked with my mother around mattered. I walked with my mother around London. I'm like Jules margin matters London. I'm like Jules margin matters London. I'm like Jules margin matters and now I'm looking at how you wake up and now I'm looking at how you wake up and now I'm looking at how you wake up every morning pretty much. every morning pretty much. every morning pretty much. >> I put my feet on the ground I say margin >> I put my feet on the ground I say margin >> I put my feet on the ground I say margin matters. Um but I start to question matters. Um but I start to question matters. Um but I start to question whether margin actually does matter in whether margin actually does matter in whether margin actually does matter in the early days. If your company is the early days. If your company is the early days.

If your company is rocking, you're spending on inference rocking, you're spending on inference rocking, you're spending on inference and that is a sign of good usage and and that is a sign of good usage and and that is a sign of good usage and love. Does margin matter? love. Does margin matter? love. Does margin matter? >> Yeah, I think the same business >> Yeah, I think the same business >> Yeah, I think the same business principles that have applied to principles that have applied to principles that have applied to businesses for the last three decades in businesses for the last three decades in businesses for the last three decades in technology are the same business technology are the same business technology are the same business principles that matter today. Margin principles that matter today. Margin principles that matter today.

Margin matters, but that is nu but it's matters, but that is nu but it's matters, but that is nu but it's nuanced. Margin I would I would add an nuanced. Margin I would I would add an nuanced. Margin I would I would add an addendum to that. Margin matters at addendum to that. Margin matters at addendum to that. Margin matters at scale. The best businesses in particular scale. The best businesses in particular scale.

The best businesses in particular infrastructure whenever there's a infrastructure whenever there's a infrastructure whenever there's a technology wave happening and an technology wave happening and an technology wave happening and an architecture shift some of the best architecture shift some of the best architecture shift some of the best businesses not all of them but some of businesses not all of them but some of businesses not all of them but some of the best businesses have had horrific the best businesses have had horrific the best businesses have had horrific margins early margins early margins early >> the hyperscalers the hyperscalers were >> the hyperscalers the hyperscalers were >> the hyperscalers the hyperscalers were low margin early those are the best low margin early those are the best low margin early those are the best software platform businesses in the software platform businesses in the software platform businesses in the world right snowflake and data bricks world right snowflake and data bricks world right snowflake and data bricks very low margin early a lot of people very low margin early a lot of people very low margin early a lot of people passed on those early rounds because oh passed on those early rounds because oh passed on those early rounds because oh in SAS you have to have 80% gross margin in SAS you have to have 80% gross margin in SAS you have to have 80% gross margin look at snowflake it's got 20 you look at snowflake it's got 20 you look at snowflake it's got 20 you like margin matters but early it can be like margin matters but early it can be like margin matters but early it can be a misleading indicator right especially a misleading indicator right especially a misleading indicator right especially when an architecture shift is happening when an architecture shift is happening when an architecture shift is happening the reason why in AI and I'll give you the reason why in AI and I'll give you the reason why in AI and I'll give you the the bullcase on this right is the the the bullcase on this right is the the the bullcase on this right is the reason why margin might not matter early reason why margin might not matter early reason why margin might not matter early on in a company's life in AI is the cost on in a company's life in AI is the cost on in a company's life in AI is the cost curve is coming down so fast say my curve is coming down so fast say my curve is coming down so fast say my inference margin is 10% today it may inference margin is 10% today it may inference margin is 10% today it may have been negative a quarter ago and have been negative a quarter ago and have been negative a quarter ago and super negative two quarters ago but the super negative two quarters ago but the super negative two quarters ago but the token costs are coming down so fast token costs are coming down so fast token costs are coming down so fast maybe I'll be if I'm an application AI maybe I'll be if I'm an application AI maybe I'll be if I'm an application AI company I'll probably be able to develop company I'll probably be able to develop company I'll probably be able to develop my own model for some of the workloads.

my own model for some of the workloads. my own model for some of the workloads. I'll probably want to use frontier I'll probably want to use frontier I'll probably want to use frontier frontier models for some of the frontier models for some of the frontier models for some of the workloads. I'll probably want to use workloads. I'll probably want to use workloads. I'll probably want to use really small cheap models for some of really small cheap models for some of really small cheap models for some of the workloads. And over time, I'll be the workloads. And over time, I'll be the workloads. And over time, I'll be able to optimize my margin. That's what able to optimize my margin. That's what able to optimize my margin. That's what we really believe is going to happen we really believe is going to happen we really believe is going to happen over time. But listen, these companies over time.

But listen, these companies over time. But listen, these companies are structurally lower margin than the are structurally lower margin than the are structurally lower margin than the last generation because you pay the last generation because you pay the last generation because you pay the cloud and you pay the LM. And so we just cloud and you pay the LM. And so we just cloud and you pay the LM. And so we just get used to actually larger outcome get used to actually larger outcome get used to actually larger outcome sizes with larger probably revenue pools sizes with larger probably revenue pools sizes with larger probably revenue pools associated but a slightly lower margin associated but a slightly lower margin associated but a slightly lower margin profile. Well from I think gross margin. profile. Well from I think gross margin. profile. Well from I think gross margin. Yes.

But what you might say is hey I'm Yes. But what you might say is hey I'm Yes. But what you might say is hey I'm actually substituting gross a lower actually substituting gross a lower actually substituting gross a lower gross margin for lower opex because my gross margin for lower opex because my gross margin for lower opex because my engineering team maybe it's more engineering team maybe it's more engineering team maybe it's more efficient. My sales team is using AI efficient. My sales team is using AI efficient. My sales team is using AI tools now. Maybe it's more efficient. My tools now. Maybe it's more efficient. My tools now. Maybe it's more efficient. My legal team maybe it's smaller and maybe legal team maybe it's smaller and maybe legal team maybe it's smaller and maybe I'm more efficient. So your terminal I'm more efficient. So your terminal I'm more efficient.

So your terminal operating margin may actually be higher operating margin may actually be higher operating margin may actually be higher in this world than the last world. Your in this world than the last world. Your in this world than the last world. Your gross margin might be lower, but your gross margin might be lower, but your gross margin might be lower, but your operating margin, which is ultimately at operating margin, which is ultimately at operating margin, which is ultimately at the end of the day is really what the end of the day is really what the end of the day is really what matters, may end up being higher. matters, may end up being higher. matters, may end up being higher.

>> What else do you think a lot of >> What else do you think a lot of >> What else do you think a lot of investors oscillate or focus on which is investors oscillate or focus on which is investors oscillate or focus on which is total [ __ ] You can pause. total [ __ ] You can pause. total [ __ ] You can pause. >> What do other investors focus on that is >> What do other investors focus on that is >> What do other investors focus on that is total [ __ ] total [ __ ] total [ __ ] >> Yeah. Like I my f my favorite thing is >> Yeah. Like I my f my favorite thing is >> Yeah. Like I my f my favorite thing is vision. Oh, we love founders with great vision. Oh, we love founders with great vision. Oh, we love founders with great vision. And I'm like, you know what? vision. And I'm like, you know what? vision. And I'm like, you know what?

Most founders who start with something Most founders who start with something Most founders who start with something worth zero, if I say, I'll give you a worth zero, if I say, I'll give you a worth zero, if I say, I'll give you a billion dollars for your thing that's billion dollars for your thing that's billion dollars for your thing that's worth zero today, they'll go, oh, worth zero today, they'll go, oh, worth zero today, they'll go, oh, billion dollars. That's great. That's billion dollars. That's great. That's billion dollars. That's great. That's really great. Some of the best really great. Some of the best really great. Some of the best companies, Google tried to sell for the companies, Google tried to sell for the companies, Google tried to sell for the lowdigit millions. lowdigit millions. lowdigit millions.

>> You unlock the next chapter through >> You unlock the next chapter through >> You unlock the next chapter through progression and continuing. Yes. progression and continuing. Yes. progression and continuing. Yes. >> I think vision is [ __ ] >> I think vision is [ __ ] >> I think vision is [ __ ] >> Yeah. I think I think you could say that >> Yeah. I think I think you could say that >> Yeah. I think I think you could say that one of the places where we don't spend one of the places where we don't spend one of the places where we don't spend time these are really going to work is time these are really going to work is time these are really going to work is these pre-revenue companies are really these pre-revenue companies are really these pre-revenue companies are really high valuations, right? I think this is high valuations, right? I think this is high valuations, right?

I think this is a lesson that at least we've taken about a lesson that at least we've taken about a lesson that at least we've taken about ourselves from 2021 is that is not our ourselves from 2021 is that is not our ourselves from 2021 is that is not our business. The pre-revenue company at a business. The pre-revenue company at a business. The pre-revenue company at a really high valuation with no product is really high valuation with no product is really high valuation with no product is not our business. And I think a lot of not our business. And I think a lot of not our business.

And I think a lot of investors are focused there right now investors are focused there right now investors are focused there right now because what ends up happening is if you because what ends up happening is if you because what ends up happening is if you can't invest in OpenAI and Anthropic and can't invest in OpenAI and Anthropic and can't invest in OpenAI and Anthropic and Revolute and SpaceX and Canva and you Revolute and SpaceX and Canva and you Revolute and SpaceX and Canva and you know all of the companies that are these know all of the companies that are these know all of the companies that are these great platform companies and you're great platform companies and you're great platform companies and you're locked in to a certain part of the locked in to a certain part of the locked in to a certain part of the ecosystem, you make decisions that you ecosystem, you make decisions that you ecosystem, you make decisions that you can make.

And so I think a lot of people can make. And so I think a lot of people can make. And so I think a lot of people are focused on that part of the are focused on that part of the are focused on that part of the ecosystem right now. And for us that ecosystem right now. And for us that ecosystem right now. And for us that doesn't make sense from a riskreward doesn't make sense from a riskreward doesn't make sense from a riskreward perspective. Our focus is real perspective. Our focus is real perspective. Our focus is real businesses that are growing really fast businesses that are growing really fast businesses that are growing really fast that we think are going to be really that we think are going to be really that we think are going to be really durable outcomes and actually generate durable outcomes and actually generate durable outcomes and actually generate liquidity for our investors.

And again, liquidity for our investors. And again, liquidity for our investors. And again, it goes back to this principle around if it goes back to this principle around if it goes back to this principle around if I have a zero, I need a six. And a six I have a zero, I need a six. And a six I have a zero, I need a six. And a six is really, really hard. You mentioned is really, really hard. You mentioned is really, really hard. You mentioned earlier that you wouldn't want to be a earlier that you wouldn't want to be a earlier that you wouldn't want to be a seed fund deploying three billion or seed fund deploying three billion or seed fund deploying three billion or staring down the gun of three billion or staring down the gun of three billion or staring down the gun of three billion or whatever it is. In a way I would because whatever it is. In a way I would because whatever it is.

In a way I would because I can absolutely destroy the economics I can absolutely destroy the economics I can absolutely destroy the economics of all the seed fund players and it's of all the seed fund players and it's of all the seed fund players and it's something that we see. We lost a deal something that we see. We lost a deal something that we see.

We lost a deal recently to a large mega fund and we did recently to a large mega fund and we did recently to a large mega fund and we did three on 15 and they did 10 on 100 um three on 15 and they did 10 on 100 um three on 15 and they did 10 on 100 um with no lick pref u pre anything and with no lick pref u pre anything and with no lick pref u pre anything and they just destroyed all the economics they just destroyed all the economics they just destroyed all the economics and I told the founders you should and I told the founders you should and I told the founders you should absolutely take that deal like and sell absolutely take that deal like and sell absolutely take that deal like and sell tomorrow for like 5 million bucks and tomorrow for like 5 million bucks and tomorrow for like 5 million bucks and you've made money. you've made money. you've made money. >> Yeah. >> Yeah. >> Yeah.

>> But they can destroy the economics. Is >> But they can destroy the economics. Is >> But they can destroy the economics. Is seed still a business when you have mega seed still a business when you have mega seed still a business when you have mega fund entry with different economics in fund entry with different economics in fund entry with different economics in the way that we do? the way that we do? the way that we do? >> I mean, I think it's gotten harder for >> I mean, I think it's gotten harder for >> I mean, I think it's gotten harder for two reasons. One is you do have this two reasons. One is you do have this two reasons.

One is you do have this megapy dynamic, but the other thing is megapy dynamic, but the other thing is megapy dynamic, but the other thing is we're in a different world than we were we're in a different world than we were we're in a different world than we were 5 years ago, right? Which is 5 years ago, right? Which is 5 years ago, right? Which is in general people are coming out of the in general people are coming out of the in general people are coming out of the gate with bigger check sizes and bigger gate with bigger check sizes and bigger gate with bigger check sizes and bigger valuations, right? And that just raises valuations, right? And that just raises valuations, right? And that just raises the risk like dramatically over time, the risk like dramatically over time, the risk like dramatically over time, right? So I think that's those are the right?

So I think that's those are the right? So I think that's those are the two dynamics that are that are really at two dynamics that are that are really at two dynamics that are that are really at play is it's harder for a seed fund to play is it's harder for a seed fund to play is it's harder for a seed fund to buy 20% today or 10% today or 5% today buy 20% today or 10% today or 5% today buy 20% today or 10% today or 5% today than it was a few years ago because of than it was a few years ago because of than it was a few years ago because of this dynamic and that has to do with a this dynamic and that has to do with a this dynamic and that has to do with a lot of different things. One of them is lot of different things. One of them is lot of different things.

One of them is in a SAS world, you didn't need that in a SAS world, you didn't need that in a SAS world, you didn't need that much capital. You start it up, you kind much capital. You start it up, you kind much capital. You start it up, you kind of get going, whatever. In this world, of get going, whatever. In this world, of get going, whatever. In this world, businesses tend to be more capital businesses tend to be more capital businesses tend to be more capital intensive, right? They may be actually intensive, right? They may be actually intensive, right? They may be actually more durable at scale because of this. more durable at scale because of this. more durable at scale because of this. Makes it harder for the next entrant to Makes it harder for the next entrant to Makes it harder for the next entrant to come in. But the reality is they're come in.

But the reality is they're come in. But the reality is they're harder to start. They take more capital harder to start. They take more capital harder to start. They take more capital and that has led to some of these like and that has led to some of these like and that has led to some of these like very big ballooning seed rounds. I think very big ballooning seed rounds. I think very big ballooning seed rounds. I think that makes it harder to be a seed that makes it harder to be a seed that makes it harder to be a seed investor in today's world. And again, investor in today's world. And again, investor in today's world.

And again, why having a flexible mandate where you why having a flexible mandate where you why having a flexible mandate where you can row up and down that river and not can row up and down that river and not can row up and down that river and not have to be there is really a nice place have to be there is really a nice place have to be there is really a nice place to be. Do you think a good investor at A to be. Do you think a good investor at A to be. Do you think a good investor at A can be a good investor at D? A lot of LP can be a good investor at D? A lot of LP can be a good investor at D? A lot of LP mindsets are like, no, early stage is mindsets are like, no, early stage is mindsets are like, no, early stage is different to growth and that's very different to growth and that's very different to growth and that's very different. I think Josh, who's a dear different.

I think Josh, who's a dear different. I think Josh, who's a dear friend at Thrive, has has proved that friend at Thrive, has has proved that friend at Thrive, has has proved that actually that's not the case. But other actually that's not the case. But other actually that's not the case. But other people still very much hold that true. I people still very much hold that true. I people still very much hold that true. I don't think it's impossible, but I do don't think it's impossible, but I do don't think it's impossible, but I do think it is very hard. And I think think it is very hard. And I think think it is very hard.

And I think that's because the type of frameworks that's because the type of frameworks that's because the type of frameworks that you use, the types of things that that you use, the types of things that that you use, the types of things that you see are very different at different you see are very different at different you see are very different at different scales. Being able to read a balance scales. Being able to read a balance scales. Being able to read a balance sheet actually does matter for a preIPO sheet actually does matter for a preIPO sheet actually does matter for a preIPO company, right? Like that really company, right? Like that really company, right? Like that really matters. But seeing thousands of matters. But seeing thousands of matters.

But seeing thousands of founders, thousands and thousands and founders, thousands and thousands and founders, thousands and thousands and thousands really matters for seed thousands really matters for seed thousands really matters for seed because what else do you have, you know, because what else do you have, you know, because what else do you have, you know, to go off of? And so I do think it to go off of? And so I do think it to go off of? And so I do think it really matters. I don't think it's really matters. I don't think it's really matters. I don't think it's impossible. I think there are some funds impossible. I think there are some funds impossible.

I think there are some funds that have done it exceptionally well, that have done it exceptionally well, that have done it exceptionally well, but I think it's why you see for us, but I think it's why you see for us, but I think it's why you see for us, right, we um we as a fund, we I actually right, we um we as a fund, we I actually right, we um we as a fund, we I actually think the public market skill set and think the public market skill set and think the public market skill set and the private market skill set is also the private market skill set is also the private market skill set is also different. And so having different folks different. And so having different folks different.

And so having different folks that are focused on different things is that are focused on different things is that are focused on different things is really important because there are really important because there are really important because there are different parameters, different things different parameters, different things different parameters, different things that you see all day. And there are that you see all day. And there are that you see all day. And there are other people that you're competing with other people that you're competing with other people that you're competing with in all of those different segments that in all of those different segments that in all of those different segments that make it really tough to be the best at make it really tough to be the best at make it really tough to be the best at everything. there seems to be a everything.

there seems to be a everything. there seems to be a consensus of excitement around certain consensus of excitement around certain consensus of excitement around certain companies and we see the concentration companies and we see the concentration companies and we see the concentration of cash to to few players in select of cash to to few players in select of cash to to few players in select industries which has led to this idea of industries which has led to this idea of industries which has led to this idea of kingmaking. kingmaking. kingmaking. >> Um when we think about kingmaking do you >> Um when we think about kingmaking do you >> Um when we think about kingmaking do you think that is a rational or real thing think that is a rational or real thing think that is a rational or real thing or do you not? or do you not? or do you not? >> I don't think it's a real thing.

>> I don't think it's a real thing. >> I don't think it's a real thing. >> You don't I don't think the king the >> You don't I don't think the king the >> You don't I don't think the king the kingm concept is a real thing. I think kingm concept is a real thing. I think kingm concept is a real thing. I think companies um some companies attract more companies um some companies attract more companies um some companies attract more capital early, some companies slingshot capital early, some companies slingshot capital early, some companies slingshot from behind, right? Having had somewhat from behind, right? Having had somewhat from behind, right? Having had somewhat less capital. less capital. less capital. >> You raise a lot of money from large tier >> You raise a lot of money from large tier >> You raise a lot of money from large tier ones who then are very vocal and loud.

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ones who then are very vocal and loud. ones who then are very vocal and loud. It dissuades other people from investing It dissuades other people from investing It dissuades other people from investing in anyone else. in anyone else. in anyone else. >> It certainly does and it's an advantage, >> It certainly does and it's an advantage, >> It certainly does and it's an advantage, but it doesn't mean that you can't build but it doesn't mean that you can't build but it doesn't mean that you can't build a great business if just because a bunch a great business if just because a bunch a great business if just because a bunch of tier ones are crowding into a name. I of tier ones are crowding into a name. I of tier ones are crowding into a name. I think there is the concept of it gives think there is the concept of it gives think there is the concept of it gives you an advantage.

More capital does give you an advantage. More capital does give you an advantage. More capital does give you an advantage. There are some cases you an advantage. There are some cases you an advantage. There are some cases where historically it's given you a where historically it's given you a where historically it's given you a disadvantage, right? Like if you have so disadvantage, right? Like if you have so disadvantage, right? Like if you have so much capital and not a lot of product much capital and not a lot of product much capital and not a lot of product market fit, I'd say you probably had a market fit, I'd say you probably had a market fit, I'd say you probably had a disadvantage. If you have a lot of disadvantage. If you have a lot of disadvantage.

If you have a lot of capital and insane product market fit capital and insane product market fit capital and insane product market fit that allows you to go hire a huge that allows you to go hire a huge that allows you to go hire a huge salesforce, salesforce, salesforce, that's a huge advantage, right? Like if that's a huge advantage, right? Like if that's a huge advantage, right? Like if you're taking if you're actively taking you're taking if you're actively taking you're taking if you're actively taking a market and you have way more capital, a market and you have way more capital, a market and you have way more capital, a better, right? Like it's this is like a better, right? Like it's this is like a better, right? Like it's this is like almost tautological, right? It's like almost tautological, right? It's like almost tautological, right? It's like that is a huge advantage.

But do I think that is a huge advantage. But do I think that is a huge advantage. But do I think that there's this concept of well if that there's this concept of well if that there's this concept of well if Kotu and Sequoia Inciner all pile into a Kotu and Sequoia Inciner all pile into a Kotu and Sequoia Inciner all pile into a company that it's over? No. I think it company that it's over? No. I think it company that it's over? No. I think it is an advantage but I don't think it is an advantage but I don't think it is an advantage but I don't think it makes it which is probably where makes it which is probably where makes it which is probably where kingmaking goes too far. Do you think we kingmaking goes too far. Do you think we kingmaking goes too far.

Do you think we are for growing companies today in the are for growing companies today in the are for growing companies today in the same way we have done before? same way we have done before? same way we have done before? >> What do you mean by that? >> What do you mean by that? >> What do you mean by that? >> You know >> You know >> You know >> yeah you know they shove a tube down it >> yeah you know they shove a tube down it >> yeah you know they shove a tube down it and then force feed it and then it and then force feed it and then it and then force feed it and then it explodes. Yeah. So we are putting too explodes. Yeah. So we are putting too explodes. Yeah.

So we are putting too much money into companies and then then much money into companies and then then much money into companies and then then they are artificially inflating and then they are artificially inflating and then they are artificially inflating and then exploding. I think there are segments of exploding. I think there are segments of exploding. I think there are segments of the market where it feels like that is the market where it feels like that is the market where it feels like that is that feels like a little bit of a that feels like a little bit of a that feels like a little bit of a problem. I think for these companies and problem. I think for these companies and problem.

I think for these companies and I and I'll just focus on what we do I and I'll just focus on what we do I and I'll just focus on what we do right for the companies that are right for the companies that are right for the companies that are explosively growing at the growth stage explosively growing at the growth stage explosively growing at the growth stage and have real product market fit, real and have real product market fit, real and have real product market fit, real product, real traction. I don't think product, real traction. I don't think product, real traction. I don't think so. Right? You look at these companies so. Right? You look at these companies so. Right?

You look at these companies that raise really rapid rounds in that raise really rapid rounds in that raise really rapid rounds in succession at the growth stage that succession at the growth stage that succession at the growth stage that actually have something underneath. No, actually have something underneath. No, actually have something underneath. No, because these cap there's real ROIC on because these cap there's real ROIC on because these cap there's real ROIC on the capital that's being invested, the capital that's being invested, the capital that's being invested, right? There's real ROI for the dollars right? There's real ROI for the dollars right? There's real ROI for the dollars that are going into these businesses. that are going into these businesses. that are going into these businesses.

Sometimes I think when growth funds in Sometimes I think when growth funds in Sometimes I think when growth funds in particular chase venture companies, particular chase venture companies, particular chase venture companies, right? We've talked about that right? We've talked about that right? We've talked about that delineation point. That's where I think delineation point. That's where I think delineation point. That's where I think it can get quite dangerous. It can make it can get quite dangerous. It can make it can get quite dangerous. It can make companies complacent. Um, it can make companies complacent. Um, it can make companies complacent. Um, it can make companies spend too much on things that companies spend too much on things that companies spend too much on things that maybe that maybe it's not great. like at maybe that maybe it's not great.

like at maybe that maybe it's not great.

like at that early stage that kind of capital that early stage that kind of capital that early stage that kind of capital scarcity I think can breed actually scarcity I think can breed actually scarcity I think can breed actually great things um and so I think there are great things um and so I think there are great things um and so I think there are parts of the market where that's parts of the market where that's parts of the market where that's certainly true these growth stage certainly true these growth stage certainly true these growth stage companies with this insane momentum I companies with this insane momentum I companies with this insane momentum I don't think so do you worry that there don't think so do you worry that there don't think so do you worry that there are a generation of companies Ala Canva are a generation of companies Ala Canva are a generation of companies Ala Canva Ala stripe which do not need to go Ala stripe which do not need to go Ala stripe which do not need to go public great businesses great businesses public great businesses great businesses public great businesses great businesses in private markets ample liquidity for in private markets ample liquidity for in private markets ample liquidity for those that want it very active secondary those that want it very active secondary those that want it very active secondary markets if they need to why would we go markets if they need to why would we go markets if they need to why would we go public as John said I don't want some public as John said I don't want some public as John said I don't want some [ __ ] 30-year-old analyst Is it some [ __ ] 30-year-old analyst Is it some [ __ ] 30-year-old analyst Is it some big bank telling me that I should big bank telling me that I should big bank telling me that I should increase sales?

increase sales? increase sales? >> Yeah. I mean, I think this is one of the >> Yeah. I mean, I think this is one of the >> Yeah. I mean, I think this is one of the reasons why companies have stayed reasons why companies have stayed reasons why companies have stayed private longer. I don't think most of private longer. I don't think most of private longer. I don't think most of those platform companies will stay those platform companies will stay those platform companies will stay private forever. I think there are a private forever. I think there are a private forever. I think there are a couple reasons that that are good to go couple reasons that that are good to go couple reasons that that are good to go public today. One is real capital at public today. One is real capital at public today. One is real capital at scale, right? Real capital at scale. scale, right? Real capital at scale.

scale, right? Real capital at scale. Still, say you're a trillion dollar plus Still, say you're a trillion dollar plus Still, say you're a trillion dollar plus company. It's available. But true company. It's available. But true company. It's available. But true liquidity that's not layers and layers liquidity that's not layers and layers liquidity that's not layers and layers and layers of SPVS and all this tricky and layers of SPVS and all this tricky and layers of SPVS and all this tricky [ __ ] and like managing your cap table [ __ ] and like managing your cap table [ __ ] and like managing your cap table like true liquidity tweeting about your like true liquidity tweeting about your like true liquidity tweeting about your layered SPVS. layered SPVS. layered SPVS.

>> I mean you've seen some of the things >> I mean you've seen some of the things >> I mean you've seen some of the things around some of these companies where around some of these companies where around some of these companies where it's like unbelievable like the opacity it's like unbelievable like the opacity it's like unbelievable like the opacity of this and the companies don't want of this and the companies don't want of this and the companies don't want that either. that either. that either. >> They want to know who their investors >> They want to know who their investors >> They want to know who their investors are and you get the investors that you are and you get the investors that you are and you get the investors that you deserve as as the as these as you know deserve as as the as these as you know deserve as as the as these as you know you scale and you go public.

So you scale and you go public. So you scale and you go public. So liquidity at scale is is certainly one liquidity at scale is is certainly one liquidity at scale is is certainly one reason. The second reason is and this reason. The second reason is and this reason.

The second reason is and this can cut this second reason I think can cut this second reason I think can cut this second reason I think really does cut both ways but the public really does cut both ways but the public really does cut both ways but the public markets are an incredible feedback markets are an incredible feedback markets are an incredible feedback mechanism for businesses right if you mechanism for businesses right if you mechanism for businesses right if you think about Netflix during their think about Netflix during their think about Netflix during their transition right like the public markets transition right like the public markets transition right like the public markets were some of the first folks like the were some of the first folks like the were some of the first folks like the analysts and the public teams to really analysts and the public teams to really analysts and the public teams to really speak about that transition from the speak about that transition from the speak about that transition from the disc to streaming right from the CD to disc to streaming right from the CD to disc to streaming right from the CD to streaming and I think especially in an streaming and I think especially in an streaming and I think especially in an AI world the public markets folks in the AI world the public markets folks in the AI world the public markets folks in the public markets are really really smart public markets are really really smart public markets are really really smart the 25-year-old analysts this and that the 25-year-old analysts this and that the 25-year-old analysts this and that right like everybody's going have right like everybody's going have right like everybody's going have varying degrees of intelligence or varying degrees of intelligence or varying degrees of intelligence or opinion, but the public markets are this opinion, but the public markets are this opinion, but the public markets are this like incredible weighing machine that like incredible weighing machine that like incredible weighing machine that can give founders amazing and teams can give founders amazing and teams can give founders amazing and teams amazing feedback on their businesses.

amazing feedback on their businesses. amazing feedback on their businesses. And then the third thing is when you go And then the third thing is when you go And then the third thing is when you go public, it's sort of harder to touch you public, it's sort of harder to touch you public, it's sort of harder to touch you in some ways. It's easier to touch you in some ways. It's easier to touch you in some ways. It's easier to touch you from a buying and selling stock, but from a buying and selling stock, but from a buying and selling stock, but you're now a public company. You're now you're now a public company. You're now you're now a public company. You're now levered to 401ks, to indices. When levered to 401ks, to indices. When levered to 401ks, to indices.

When you're a private company, people can you're a private company, people can you're a private company, people can mess with you a little bit more. It just mess with you a little bit more. It just mess with you a little bit more. It just is what it is. They can mess with you. is what it is. They can mess with you. is what it is. They can mess with you. When you're a public company and you are When you're a public company and you are When you're a public company and you are a big important public company is harder a big important public company is harder a big important public company is harder to mess with businesses and so you kind to mess with businesses and so you kind to mess with businesses and so you kind of have this rigor around you. I adore of have this rigor around you. I adore of have this rigor around you.

I adore Cliff and and Mel and I think they're Cliff and and Mel and I think they're Cliff and and Mel and I think they're amazing. But you said about like the amazing. But you said about like the amazing. But you said about like the platform companies and you included platform companies and you included platform companies and you included Canva. If you were to be a harsh critic Canva. If you were to be a harsh critic Canva. If you were to be a harsh critic and you say, "Well, Figma is worth 11 and you say, "Well, Figma is worth 11 and you say, "Well, Figma is worth 11 billion today and image generation, billion today and image generation, billion today and image generation, graphic generation is right in the graphic generation is right in the graphic generation is right in the pathway of a lot of large AI companies. pathway of a lot of large AI companies.

pathway of a lot of large AI companies. Is Canva really a platform company?" Is Canva really a platform company?" Is Canva really a platform company?" What I love about Canva is they've shown What I love about Canva is they've shown What I love about Canva is they've shown that same ability that data bricks has that same ability that data bricks has that same ability that data bricks has where they're able to hop multiple where they're able to hop multiple where they're able to hop multiple Surves and develop multiple products. Surves and develop multiple products. Surves and develop multiple products. Right? They started as I I'm sure you Right? They started as I I'm sure you Right? They started as I I'm sure you know the story, but it's incredible. Mel know the story, but it's incredible. Mel know the story, but it's incredible.

Mel started Mel and K and Cliff started this started Mel and K and Cliff started this started Mel and K and Cliff started this business as a yearbook business making business as a yearbook business making business as a yearbook business making yearbooks. They successfully yearbooks. They successfully yearbooks. They successfully transitioned that online. They transitioned that online. They transitioned that online. They successfully trans transitioned that to successfully trans transitioned that to successfully trans transitioned that to SAS and now they've transitioned to many SAS and now they've transitioned to many SAS and now they've transitioned to many many many products. Right? Canvas is a many many products. Right? Canvas is a many many products. Right?

Canvas is a suite of like a dozen products that are suite of like a dozen products that are suite of like a dozen products that are all growing extraordinarily quickly. So all growing extraordinarily quickly. So all growing extraordinarily quickly. So you have that dynamic and then the other you have that dynamic and then the other you have that dynamic and then the other thing that I love is they were one of thing that I love is they were one of thing that I love is they were one of the first companies that really leaned the first companies that really leaned the first companies that really leaned into AI. I remember Cliff called me into AI. I remember Cliff called me into AI.

I remember Cliff called me about this very early on because we were about this very early on because we were about this very early on because we were early investors in uh in stable early investors in uh in stable early investors in uh in stable diffusion if you remember the image the diffusion if you remember the image the diffusion if you remember the image the image generation company in OpenAI and a image generation company in OpenAI and a image generation company in OpenAI and a few of these other businesses and he few of these other businesses and he few of these other businesses and he called us really early in this wave like called us really early in this wave like called us really early in this wave like pre- chatbt in this wave and was like pre- chatbt in this wave and was like pre- chatbt in this wave and was like hey we're going to start integrating AI hey we're going to start integrating AI hey we're going to start integrating AI into our business now and so that type into our business now and so that type into our business now and so that type of mentality both the ability to develop of mentality both the ability to develop of mentality both the ability to develop multiple products and hop Tams and to multiple products and hop Tams and to multiple products and hop Tams and to stay ahead of the curve in AI I think is stay ahead of the curve in AI I think is stay ahead of the curve in AI I think is going to serve them very well.

I again I going to serve them very well. I again I going to serve them very well. I again I love Cliff and I love Mel and I totally love Cliff and I love Mel and I totally love Cliff and I love Mel and I totally agree with you in terms of that agree with you in terms of that agree with you in terms of that expansion. You know what I also love expansion. You know what I also love expansion. You know what I also love about that story? Married couple amazing about that story? Married couple amazing about that story? Married couple amazing Australia Australia Australia non-technical non-technical non-technical yearbooks like to be fair the seed yearbooks like to be fair the seed yearbooks like to be fair the seed investors of that in I'm not taking investors of that in I'm not taking investors of that in I'm not taking anything away from Malen Cliff again.

I anything away from Malen Cliff again. I anything away from Malen Cliff again. I think they're exceptional but you've got think they're exceptional but you've got think they're exceptional but you've got to be quite mentally plastic away from to be quite mentally plastic away from to be quite mentally plastic away from the traditional investing rules to be the traditional investing rules to be the traditional investing rules to be like yep all in. like yep all in. like yep all in. >> Credit to those folks. Um, and I mean, >> Credit to those folks. Um, and I mean, >> Credit to those folks. Um, and I mean, credit to the growth investors who took credit to the growth investors who took credit to the growth investors who took a leap on that one a little early, too, a leap on that one a little early, too, a leap on that one a little early, too, right? It was very non-obvious. It's I right?

It was very non-obvious. It's I right? It was very non-obvious. It's I mean, I I worked for Mary Mer when I was mean, I I worked for Mary Mer when I was mean, I I worked for Mary Mer when I was at at Kleiner Perkins, and she was one at at Kleiner Perkins, and she was one at at Kleiner Perkins, and she was one of the folks that took a leap on Canva. of the folks that took a leap on Canva. of the folks that took a leap on Canva. >> What's your biggest lesson from working >> What's your biggest lesson from working >> What's your biggest lesson from working with Mary? with Mary? with Mary? >> I mean, so many lessons. I think the >> I mean, so many lessons. I think the >> I mean, so many lessons.

I think the biggest lesson is she has this and it it biggest lesson is she has this and it it biggest lesson is she has this and it it comes from her background of being at comes from her background of being at comes from her background of being at Morgan Stanley for a really long time. Morgan Stanley for a really long time. Morgan Stanley for a really long time. She has this incredible analytical bent She has this incredible analytical bent She has this incredible analytical bent of being able to see things and see of being able to see things and see of being able to see things and see stories and numbers that other folks stories and numbers that other folks stories and numbers that other folks don't and being willing to lean against don't and being willing to lean against don't and being willing to lean against the grain whenever she feels things.

Um, the grain whenever she feels things. Um, the grain whenever she feels things. Um, and she's able to tell and tell these and she's able to tell and tell these and she's able to tell and tell these incredible stories with data and incredible stories with data and incredible stories with data and understand what's happening in the world understand what's happening in the world understand what's happening in the world based on data. I'll give you one example based on data. I'll give you one example based on data. I'll give you one example is I remember my second week at Kleiner. is I remember my second week at Kleiner. is I remember my second week at Kleiner. Um, I didn't know how to model. I came Um, I didn't know how to model. I came Um, I didn't know how to model. I came from in I came from insight. I could bar from in I came from insight. I could bar from in I came from insight.

I could bar I could barely model. I was great at I could barely model. I was great at I could barely model. I was great at talking to founders but could barely talking to founders but could barely talking to founders but could barely model. And I found myself, you know, in model. And I found myself, you know, in model. And I found myself, you know, in the middle of a modeling exercise with the middle of a modeling exercise with the middle of a modeling exercise with Mary and just getting absolutely Mary and just getting absolutely Mary and just getting absolutely destroyed. And one of the things she destroyed. And one of the things she destroyed. And one of the things she taught me is like that is actually taught me is like that is actually taught me is like that is actually really important. Being able to express really important. Being able to express really important.

Being able to express a company in a few a complex company in a company in a few a complex company in a company in a few a complex company in a few lines in Excel and tell stories a few lines in Excel and tell stories a few lines in Excel and tell stories with data is like an incredible skill. with data is like an incredible skill. with data is like an incredible skill. And she has this knack of being able to And she has this knack of being able to And she has this knack of being able to look at like sell in 95 and know there's look at like sell in 95 and know there's look at like sell in 95 and know there's an error. And so that's what I learned an error. And so that's what I learned an error.

And so that's what I learned is to be like highly analytical, very is to be like highly analytical, very is to be like highly analytical, very detail- oriented, and to tell the story detail- oriented, and to tell the story detail- oriented, and to tell the story with the data. with the data. with the data. >> To what extent does that truly matter >> To what extent does that truly matter >> To what extent does that truly matter versus phenomenal founder, big market versus phenomenal founder, big market versus phenomenal founder, big market growing fast? growing fast? growing fast?

>> I the way that I phrase data, and I >> I the way that I phrase data, and I >> I the way that I phrase data, and I phrase this to our team a lot, and this phrase this to our team a lot, and this phrase this to our team a lot, and this is what I really believe is data is a is what I really believe is data is a is what I really believe is data is a prerequisite. It is not the answer. The prerequisite. It is not the answer. The prerequisite. It is not the answer. The data must be very good, but it's not the data must be very good, but it's not the data must be very good, but it's not the it's not the whole picture. And I it's not the whole picture. And I it's not the whole picture.

And I remember um I I was sitting in a very remember um I I was sitting in a very remember um I I was sitting in a very old IC and we were when we were looking old IC and we were when we were looking old IC and we were when we were looking at data bricks at CO2 way back when um at data bricks at CO2 way back when um at data bricks at CO2 way back when um and Thomas was like Lucas you're missing and Thomas was like Lucas you're missing and Thomas was like Lucas you're missing the force through the trees here like the force through the trees here like the force through the trees here like just because net new AR didn't just because net new AR didn't just because net new AR didn't accelerate dramatically in any given accelerate dramatically in any given accelerate dramatically in any given quarter does not mean this trend is not quarter does not mean this trend is not quarter does not mean this trend is not happening and so net new ARR or whatever happening and so net new ARR or whatever happening and so net new ARR or whatever metric you want to use they're metric you want to use they're metric you want to use they're incredible guideposts but you can't miss incredible guideposts but you can't miss incredible guideposts but you can't miss the for you can't miss the forest the for you can't miss the forest the for you can't miss the forest through the trees in this like the through the trees in this like the through the trees in this like the bigger picture it really matters but it bigger picture it really matters but it bigger picture it really matters but it is it is helpful, right?

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I I'd say like is it is helpful, right? I I'd say like is it is helpful, right? I I'd say like the thing that I'm looking at the most the thing that I'm looking at the most the thing that I'm looking at the most with a lot of these um kind of AI native with a lot of these um kind of AI native with a lot of these um kind of AI native businesses is if you're low margin, I businesses is if you're low margin, I businesses is if you're low margin, I need you to have high retention. You need you to have high retention. You need you to have high retention. You have to have it because if you you leave have to have it because if you you leave have to have it because if you you leave no margin for error if that's not true, no margin for error if that's not true, no margin for error if that's not true, right? I need if you're be a low margin right? I need if you're be a low margin right?

I need if you're be a low margin business to start, the customer behavior business to start, the customer behavior business to start, the customer behavior must be so sticky. It's got to be so must be so sticky. It's got to be so must be so sticky. It's got to be so sticky because otherwise you're really sticky because otherwise you're really sticky because otherwise you're really really fragile. One move the wrong way really fragile. One move the wrong way really fragile. One move the wrong way and you have no margin for error, right? and you have no margin for error, right? and you have no margin for error, right? So like those are the types of places So like those are the types of places So like those are the types of places where data can help you. It can hurt you where data can help you. It can hurt you where data can help you.

It can hurt you if you live in Excel all day and you are if you live in Excel all day and you are if you live in Excel all day and you are like just missing the forest through the like just missing the forest through the like just missing the forest through the trees. trees. trees. >> Totally agree with that. You worked with >> Totally agree with that. You worked with >> Totally agree with that. You worked with Mimoon too. Mimoon too. Mimoon too. >> Yes. >> Yes. >> Yes. >> I I really love Mimoon. >> I I really love Mimoon. >> I I really love Mimoon. >> Me too. >> Me too. >> Me too. >> What was your biggest lesson from >> What was your biggest lesson from >> What was your biggest lesson from working with Mimoon? working with Mimoon? working with Mimoon? >> Again so many. I think the thing that >> Again so many. I think the thing that >> Again so many.

I think the thing that the gift that hasn't I think from the the gift that hasn't I think from the the gift that hasn't I think from the SAS era my view is he was the best SAS era my view is he was the best SAS era my view is he was the best series A investor in the SAS era period. series A investor in the SAS era period. series A investor in the SAS era period. Right. Right. I mean, if you look at his Right. Right. I mean, if you look at his Right. Right. I mean, if you look at his track record, it's incredible. Figma, track record, it's incredible. Figma, track record, it's incredible. Figma, Glean, Ripling, Slack. I mean, it's just Glean, Ripling, Slack. I mean, it's just Glean, Ripling, Slack. I mean, it's just this unbelievable like hit after hit this unbelievable like hit after hit this unbelievable like hit after hit after hit. What Mimoon is special at and after hit.

What Mimoon is special at and after hit. What Mimoon is special at and what he pays attention to and what I what he pays attention to and what I what he pays attention to and what I learned from him is there are distinct learned from him is there are distinct learned from him is there are distinct inflection points in companies. There inflection points in companies. There inflection points in companies. There are moments where they really kink, are moments where they really kink, are moments where they really kink, right? They kink up. And he is the right? They kink up. And he is the right? They kink up. And he is the master at seeing that around the series master at seeing that around the series master at seeing that around the series A, right? With very little data, being A, right? With very little data, being A, right? With very little data, being able to see it.

I remember we going back able to see it. I remember we going back able to see it. I remember we going back to um I worked on uh Figma with him when to um I worked on uh Figma with him when to um I worked on uh Figma with him when I was an associate at Kleiner and I cut I was an associate at Kleiner and I cut I was an associate at Kleiner and I cut all the data for Moon. This is a it was all the data for Moon. This is a it was all the data for Moon.

This is a it was it was a very fun time and I remember he it was a very fun time and I remember he it was a very fun time and I remember he took one look at it and within 30 took one look at it and within 30 took one look at it and within 30 seconds he was like we're doing it and seconds he was like we're doing it and seconds he was like we're doing it and there was this big company in vision at there was this big company in vision at there was this big company in vision at the time and it was a great company and the time and it was a great company and the time and it was a great company and everybody thought it was the winner and everybody thought it was the winner and everybody thought it was the winner and he looked at that data and he was like he looked at that data and he was like he looked at that data and he was like this is this is going to happen and what this is this is going to happen and what this is this is going to happen and what he saw is the net retention curves the he saw is the net retention curves the he saw is the net retention curves the customer behavior of really big customer behavior of really big customer behavior of really big companies I think I can't remember companies I think I can't remember companies I think I can't remember exactly but I think the companies were exactly but I think the companies were exactly but I think the companies were Google and Square and Amazon right like Google and Square and Amazon right like Google and Square and Amazon right like really insane customers and this is when really insane customers and this is when really insane customers and this is when Figma had 500k of AR and he saw saw the Figma had 500k of AR and he saw saw the Figma had 500k of AR and he saw saw the usage curves inside those three usage curves inside those three usage curves inside those three companies.

He's like, "We're at an companies. He's like, "We're at an companies. He's like, "We're at an inflection point. We're doing this." And inflection point. We're doing this." And inflection point. We're doing this." And that's what he's amazing at. that's what he's amazing at. that's what he's amazing at. >> I'm not surprised. And time and time >> I'm not surprised. And time and time >> I'm not surprised. And time and time again, I'm amazed by the insight. Again, again, I'm amazed by the insight. Again, again, I'm amazed by the insight.

Again, I meet so many investors and I actually I meet so many investors and I actually I meet so many investors and I actually find not that many have the insight that find not that many have the insight that find not that many have the insight that Mimoon has, that Neil Ma has, that Pat Mimoon has, that Neil Ma has, that Pat Mimoon has, that Neil Ma has, that Pat Grady have. Super unfair question. You Grady have. Super unfair question. You Grady have. Super unfair question. You super unfair question. You can invest in super unfair question. You can invest in super unfair question. You can invest in Mary Maker's fund, the solo GPS. Mary Mary Maker's fund, the solo GPS. Mary Mary Maker's fund, the solo GPS. Mary Mik's fund, Nam Moon's fund, or Jeff Mik's fund, Nam Moon's fund, or Jeff Mik's fund, Nam Moon's fund, or Jeff Horing's fund. Whoa. Horing's fund. Whoa. Horing's fund. Whoa.

I want dollars. Absolute dollar return. I want dollars. Absolute dollar return. I want dollars. Absolute dollar return. Absolute dollar return. I think you got Absolute dollar return. I think you got Absolute dollar return. I think you got to split it in some way, right? I think to split it in some way, right? I think to split it in some way, right? I think what you're looking for if you're none what you're looking for if you're none what you're looking for if you're none of them pay you anymore. of them pay you anymore. of them pay you anymore. >> Yeah, I know. I know. I know. >> Yeah, I know. I know. I know. >> Yeah, I know. I know. I know.

>> But if you're looking if you're if >> But if you're looking if you're if >> But if you're looking if you're if you're an LP, what you're looking for is you're an LP, what you're looking for is you're an LP, what you're looking for is the best return across different the best return across different the best return across different strategies. I think it's going to depend strategies. I think it's going to depend strategies. I think it's going to depend on what on what you're looking for, what on what on what you're looking for, what on what on what you're looking for, what your time resonance is. Let me give you your time resonance is. Let me give you your time resonance is. Let me give you the benefits, right? Moon, I think, is the benefits, right? Moon, I think, is the benefits, right?

Moon, I think, is going to have an incredibly high going to have an incredibly high going to have an incredibly high slugging average, really amazing slugging average, really amazing slugging average, really amazing returns, but it's going to be more risk. returns, but it's going to be more risk. returns, but it's going to be more risk. Mary, I think you're going to get like Mary, I think you're going to get like Mary, I think you're going to get like this incredible growth portfolio of blue this incredible growth portfolio of blue this incredible growth portfolio of blue chip names. And then Horing is going to chip names. And then Horing is going to chip names. And then Horing is going to provide you very strong stable core provide you very strong stable core provide you very strong stable core returns, right? And I think like it returns, right? And I think like it returns, right?

And I think like it really depends on what you're what really depends on what you're what really depends on what you're what you're looking for, right? And LPS want you're looking for, right? And LPS want you're looking for, right? And LPS want different things and they probably want different things and they probably want different things and they probably want exposure to all three in different ways. exposure to all three in different ways. exposure to all three in different ways. Let me ask you another one because you Let me ask you another one because you Let me ask you another one because you failed at that one. Okay. You've got Pat failed at that one. Okay. You've got Pat failed at that one. Okay. You've got Pat Grady at Sequoia. You've got David Grady at Sequoia. You've got David Grady at Sequoia. You've got David George. And then you've got the folks at George.

And then you've got the folks at George. And then you've got the folks at Founders Fund, the Napoleons and the Founders Fund, the Napoleons and the Founders Fund, the Napoleons and the behind the scenes people at Founders behind the scenes people at Founders behind the scenes people at Founders Fund. You can only invest in one fund. Fund. You can only invest in one fund. Fund. You can only invest in one fund. >> Oh, you can't do this to me. You can't >> Oh, you can't do this to me. You can't >> Oh, you can't do this to me. You can't do this to me. I'm going to let you out do this to me. I'm going to let you out do this to me. I'm going to let you out of the room. of the room. of the room. >> No, it's incredible. Um, I think >> No, it's incredible. Um, I think >> No, it's incredible.

Um, I think Founders Fund's strategy of being ultra Founders Fund's strategy of being ultra Founders Fund's strategy of being ultra concentrated in a few companies has just concentrated in a few companies has just concentrated in a few companies has just been this incredible strategy over time been this incredible strategy over time been this incredible strategy over time and I think Pat Grady's ability to pick and I think Pat Grady's ability to pick and I think Pat Grady's ability to pick series B's is like pretty unmatched pick series B's is like pretty unmatched pick series B's is like pretty unmatched pick and win series B's. He's very very good and win series B's. He's very very good and win series B's. He's very very good and I think Sequoia is very good at and I think Sequoia is very good at and I think Sequoia is very good at that. So I think again they're they're that.

So I think again they're they're that. So I think again they're they're they're good for different reasons but they're good for different reasons but they're good for different reasons but it again it really depends on what you it again it really depends on what you it again it really depends on what you like. Final one before we do a quick like. Final one before we do a quick like. Final one before we do a quick fire. You have one final dollar and you fire. You have one final dollar and you fire. You have one final dollar and you can put it in Open AI or Anthropic. can put it in Open AI or Anthropic. can put it in Open AI or Anthropic. Which one would you put it in? Right. Which one would you put it in? Right. Which one would you put it in? Right. I'll talk about the merits of both. Open I'll talk about the merits of both. Open I'll talk about the merits of both.

Open AI, incredible consumer franchise, AI, incredible consumer franchise, AI, incredible consumer franchise, right? Just incredible consumer right? Just incredible consumer right? Just incredible consumer franchise. The retention curves, the franchise. The retention curves, the franchise. The retention curves, the growth, all of this stuff, what they've growth, all of this stuff, what they've growth, all of this stuff, what they've done, it's just it it's insane the done, it's just it it's insane the done, it's just it it's insane the innovation that's coming out of that innovation that's coming out of that innovation that's coming out of that business. on the consumer side, their business. on the consumer side, their business.

on the consumer side, their strength that's emerging in enterprise strength that's emerging in enterprise strength that's emerging in enterprise with codeex and and other coding use with codeex and and other coding use with codeex and and other coding use cases in these big transformational cases in these big transformational cases in these big transformational enterprise deals and like a third enterprise deals and like a third enterprise deals and like a third unknown unknown vector. They have this unknown unknown vector. They have this unknown unknown vector. They have this like almost unknown unknown about it like almost unknown unknown about it like almost unknown unknown about it because they acquired Johnny Ice because they acquired Johnny Ice because they acquired Johnny Ice company, right? Who knows what that company, right? Who knows what that company, right?

Who knows what that could look like in 5 to 10 years. They could look like in 5 to 10 years. They could look like in 5 to 10 years. They have this like SpaceX, you know, it's have this like SpaceX, you know, it's have this like SpaceX, you know, it's like how do you value space? Well, how like how do you value space? Well, how like how do you value space? Well, how do you value AI, right? It's like this do you value AI, right? It's like this do you value AI, right? It's like this unknown unknown element of just how big unknown unknown element of just how big unknown unknown element of just how big could it get? I think that's the that's could it get? I think that's the that's could it get? I think that's the that's the bull case. Did you see the design the bull case. Did you see the design the bull case.

Did you see the design work that Johnny Ives team did for work that Johnny Ives team did for work that Johnny Ives team did for Ferrari? Ferrari? Ferrari? Oh my god, I can't drive. I don't have a Oh my god, I can't drive. I don't have a Oh my god, I can't drive. I don't have a license. I want a [ __ ] car like this license. I want a [ __ ] car like this license. I want a [ __ ] car like this because of Johnny's design. I was like, because of Johnny's design. I was like, because of Johnny's design. I was like, >> you're going to have to learn. >> you're going to have to learn. >> you're going to have to learn. >> You're going to have to go get a >> You're going to have to go get a >> You're going to have to go get a >> No, I ain't got a license. It'll be a >> No, I ain't got a license. It'll be a >> No, I ain't got a license. It'll be a present. present. present.

>> But I was like, >> But I was like, >> But I was like, >> you can ride shotgun. >> you can ride shotgun. >> you can ride shotgun. >> Exactly. I'm very happy to hold the >> Exactly. I'm very happy to hold the >> Exactly. I'm very happy to hold the phone with the maps. phone with the maps. phone with the maps. >> There you go. >> There you go. >> There you go. >> But I was like, "Wow, I've never wanted >> But I was like, "Wow, I've never wanted >> But I was like, "Wow, I've never wanted a car as much as Johnny's design." a car as much as Johnny's design." a car as much as Johnny's design." >> Yeah, it's amazing. >> Yeah, it's amazing. >> Yeah, it's amazing. >> Yeah, >> Yeah, >> Yeah, >> it's incredible. And I think like that's >> it's incredible. And I think like that's >> it's incredible. And I think like that's the bullcase. The bulk on anthropic is the bullcase.

The bulk on anthropic is the bullcase. The bulk on anthropic is really simple and really really simple and really really simple and really straightforward. Their focus on coding straightforward. Their focus on coding straightforward. Their focus on coding has been an unbelievable advantage for has been an unbelievable advantage for has been an unbelievable advantage for them because coding is the first use them because coding is the first use them because coding is the first use case in AI that's really taken off. That case in AI that's really taken off. That case in AI that's really taken off.

That code that coding focus has led them to code that coding focus has led them to code that coding focus has led them to have a beach head in all the other have a beach head in all the other have a beach head in all the other analytical tasks in the enterprise, analytical tasks in the enterprise, analytical tasks in the enterprise, right? Everything is code, right? Like right? Everything is code, right? Like right? Everything is code, right? Like everything in the digital world is code. everything in the digital world is code. everything in the digital world is code. And by having a great coding model, And by having a great coding model, And by having a great coding model, they've been able to do that. And the they've been able to do that. And the they've been able to do that.

And the last strategic decision that they made last strategic decision that they made last strategic decision that they made that I think is really sort of that I think is really sort of that I think is really sort of unappreciated by the market is they unappreciated by the market is they unappreciated by the market is they built for every cloud and they built for built for every cloud and they built for built for every cloud and they built for every chip platform and that gives them every chip platform and that gives them every chip platform and that gives them incredible optionality and a lot of incredible optionality and a lot of incredible optionality and a lot of people want them to win and so that is people want them to win and so that is people want them to win and so that is like a real advantage. So they all like a real advantage. So they all like a real advantage.

So they all >> is that I'm sorry I'm really naive here >> is that I'm sorry I'm really naive here >> is that I'm sorry I'm really naive here and I'm not asking for like who's better and I'm not asking for like who's better and I'm not asking for like who's better or who's worse. Is that different to the or who's worse. Is that different to the or who's worse. Is that different to the other providers? It is right because other providers? It is right because other providers?

It is right because some of the other providers have been some of the other providers have been some of the other providers have been sort of at least until this point right sort of at least until this point right sort of at least until this point right like this is always changing but they like this is always changing but they like this is always changing but they from kind of from day one had from kind of from day one had from kind of from day one had architected themselves to be able to be architected themselves to be able to be architected themselves to be able to be partners with every cloud and to be with partners with every cloud and to be with partners with every cloud and to be with tranium and TPUs and GPUs and that takes tranium and TPUs and GPUs and that takes tranium and TPUs and GPUs and that takes a lot of infrastructure investment but a lot of infrastructure investment but a lot of infrastructure investment but it means in a capacity constrained world it means in a capacity constrained world it means in a capacity constrained world where the demand for compute out where the demand for compute out where the demand for compute out outstrips supply their ability to do outstrips supply their ability to do outstrips supply their ability to do that makes them more cost effective.

It that makes them more cost effective. It that makes them more cost effective. It gives them an advantage on where they gives them an advantage on where they gives them an advantage on where they can deploy. They can take capacity that can deploy. They can take capacity that can deploy. They can take capacity that other people can't. And that means like, other people can't. And that means like, other people can't. And that means like, hey, in this world that's an advantage. hey, in this world that's an advantage. hey, in this world that's an advantage. >> I totally get you. And actually having >> I totally get you. And actually having >> I totally get you. And actually having more people support you is a very very more people support you is a very very more people support you is a very very advantageous position. advantageous position. advantageous position. >> Yeah.

It's one of the things that we >> Yeah. It's one of the things that we >> Yeah. It's one of the things that we actually we always try to think about is actually we always try to think about is actually we always try to think about is like and it's a a question that Philipe like and it's a a question that Philipe like and it's a a question that Philipe asks all the time is like who's going to asks all the time is like who's going to asks all the time is like who's going to want to help you and who's going to want want to help you and who's going to want want to help you and who's going to want to hurt you because that ultimately to hurt you because that ultimately to hurt you because that ultimately matters, right? Like matters, right? Like matters, right?

Like having a lot of people want to help you having a lot of people want to help you having a lot of people want to help you and benefit from your growth is a very and benefit from your growth is a very and benefit from your growth is a very nice position to be in. nice position to be in. nice position to be in. >> Clearly Phipe agrees with kingmaking >> Clearly Phipe agrees with kingmaking >> Clearly Phipe agrees with kingmaking then. then. then. >> Well, it certainly helps. >> Well, it certainly helps. >> Well, it certainly helps. >> It totally helps. Listen, I I want to do >> It totally helps. Listen, I I want to do >> It totally helps. Listen, I I want to do a quick fire. So, I say a short a quick fire. So, I say a short a quick fire. So, I say a short statement, you give me your immediate statement, you give me your immediate statement, you give me your immediate thoughts.

Does that sound okay? thoughts. Does that sound okay? thoughts. Does that sound okay? >> Done. >> Done. >> Done. >> What have you changed your mind on in >> What have you changed your mind on in >> What have you changed your mind on in the last 12 months? the last 12 months? the last 12 months? >> The size of outcomes. This is really >> The size of outcomes. This is really >> The size of outcomes. This is really simple. like 12 months ago, I wasn't as simple. like 12 months ago, I wasn't as simple.

like 12 months ago, I wasn't as convinced that we were really going to convinced that we were really going to convinced that we were really going to be able to address labor um and that be able to address labor um and that be able to address labor um and that this like token machine concept that, this like token machine concept that, this like token machine concept that, you know, human inputs were going to you know, human inputs were going to you know, human inputs were going to become machine inputs. I wasn't all the become machine inputs. I wasn't all the become machine inputs. I wasn't all the way there. We were still kind of in an way there. We were still kind of in an way there. We were still kind of in an assistant world versus an agent world. assistant world versus an agent world. assistant world versus an agent world. I've become fully convinced on this.

A I've become fully convinced on this. A I've become fully convinced on this. A lot of it is due to using a lot of the lot of it is due to using a lot of the lot of it is due to using a lot of the tools like Claude Code myself and just tools like Claude Code myself and just tools like Claude Code myself and just really feeling this. But that my opinion really feeling this. But that my opinion really feeling this. But that my opinion has really changed on that in the last has really changed on that in the last has really changed on that in the last year. I think the outcomes this year. I think the outcomes this year.

I think the outcomes this generation in technology are going to be generation in technology are going to be generation in technology are going to be so much bigger than the outcomes from so much bigger than the outcomes from so much bigger than the outcomes from the last generation. the last generation. the last generation. >> When you think about that labor >> When you think about that labor >> When you think about that labor displacement, do you think we are displacement, do you think we are displacement, do you think we are overestimating the adoption of overestimating the adoption of overestimating the adoption of enterprise and labor displacement or enterprise and labor displacement or enterprise and labor displacement or actually underestimating it's coming actually underestimating it's coming actually underestimating it's coming sooner than we think? sooner than we think?

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sooner than we think? >> This is the hardest question, right? And >> This is the hardest question, right? And >> This is the hardest question, right? And it's like if you go back to the last it's like if you go back to the last it's like if you go back to the last era, people always overestimate or era, people always overestimate or era, people always overestimate or underestimate how long it takes to do underestimate how long it takes to do underestimate how long it takes to do things. And I think it's because they things. And I think it's because they things.

And I think it's because they look at the consumer and they see how look at the consumer and they see how look at the consumer and they see how fast the consumer changes and adopts fast the consumer changes and adopts fast the consumer changes and adopts things and apply the same thing to things and apply the same thing to things and apply the same thing to enterprise. I don't think it's unlikely enterprise. I don't think it's unlikely enterprise. I don't think it's unlikely that we're going to wake up tomorrow and that we're going to wake up tomorrow and that we're going to wake up tomorrow and all these SAS companies have, you know, all these SAS companies have, you know, all these SAS companies have, you know, evaporated. Change takes time, right? evaporated. Change takes time, right? evaporated. Change takes time, right? These things are going to take time.

These things are going to take time. These things are going to take time. That said, these things are happening That said, these things are happening That said, these things are happening much faster than they were before. If much faster than they were before. If much faster than they were before. If you look at anthropic, right, publicly you look at anthropic, right, publicly you look at anthropic, right, publicly available numbers, 9 billion of AR available numbers, 9 billion of AR available numbers, 9 billion of AR growing 800%. growing 800%. growing 800%. at the same scale the three hyperscalers at the same scale the three hyperscalers at the same scale the three hyperscalers on average when they were 9 billion of on average when they were 9 billion of on average when they were 9 billion of AR were growing 60%. AR were growing 60%. AR were growing 60%.

So it's happening faster than SAS did. So it's happening faster than SAS did. So it's happening faster than SAS did. We know that it just is like it's in the We know that it just is like it's in the We know that it just is like it's in the data, right? That's that's the story. data, right? That's that's the story. data, right? That's that's the story. But how long is it going to take for all But how long is it going to take for all But how long is it going to take for all of this to happen? I think it's going to of this to happen? I think it's going to of this to happen? I think it's going to take a long time, right? Because people take a long time, right? Because people take a long time, right? Because people are slow. They're sticky. Change is are slow. They're sticky. Change is are slow. They're sticky. Change is hard, right? It's not like I can just hard, right?

It's not like I can just hard, right? It's not like I can just throw claw into an enterprise and all of throw claw into an enterprise and all of throw claw into an enterprise and all of a sudden it works. There's integration a sudden it works. There's integration a sudden it works. There's integration work that has to be done. There's work that has to be done. There's work that has to be done. There's deployment that has to be done. Like deployment that has to be done. Like deployment that has to be done. Like this stuff is complex. One of the most this stuff is complex. One of the most this stuff is complex. One of the most [ __ ] ones is people talk about like [ __ ] ones is people talk about like [ __ ] ones is people talk about like in the agricultural revolution, the in the agricultural revolution, the in the agricultural revolution, the industrial revolution.

And I'm like, industrial revolution. And I'm like, industrial revolution. And I'm like, yeah, you had to buy a [ __ ] tractor yeah, you had to buy a [ __ ] tractor yeah, you had to buy a [ __ ] tractor as a farm in France and then train your as a farm in France and then train your as a farm in France and then train your 75 people on a tractor that comes in a 75 people on a tractor that comes in a 75 people on a tractor that comes in a year's time and then you have to year's time and then you have to year's time and then you have to assemble it and then train them on assemble it and then train them on assemble it and then train them on safety and document. Here it's like safety and document. Here it's like safety and document. Here it's like Gemini puts in Nano Banana Pro and Gemini puts in Nano Banana Pro and Gemini puts in Nano Banana Pro and you're good to go tomorrow.

you're good to go tomorrow. you're good to go tomorrow. >> Yeah, it is faster. It's certainly >> Yeah, it is faster. It's certainly >> Yeah, it is faster. It's certainly faster. faster. faster. >> So much faster. Um, what's the single me >> So much faster. Um, what's the single me >> So much faster. Um, what's the single me most memorable first founder meeting most memorable first founder meeting most memorable first founder meeting you've had? I'm not asking for the best you've had? I'm not asking for the best you've had? I'm not asking for the best fan, like the most memorable first fan, like the most memorable first fan, like the most memorable first found. found. found. >> Winston from Harvey. >> Winston from Harvey. >> Winston from Harvey. >> Why? >> Why? >> Why? >> It's not even close. I think it was >> It's not even close. I think it was >> It's not even close.

I think it was because one, I already believed when I because one, I already believed when I because one, I already believed when I when I came into the meeting. And then when I came into the meeting. And then when I came into the meeting. And then two, the founder market fit in the story two, the founder market fit in the story two, the founder market fit in the story was so clear so early, right? Like what was so clear so early, right? Like what was so clear so early, right? Like what are language models good at? Language. are language models good at? Language. are language models good at? Language. Text in, text out. What is one of the Text in, text out. What is one of the Text in, text out. What is one of the most like textheavy professions? Law. most like textheavy professions? Law. most like textheavy professions? Law. What have I seen early on? Document What have I seen early on?

Document What have I seen early on? Document generation, document analysis. and his generation, document analysis. and his generation, document analysis. and his articulation of that thesis and that articulation of that thesis and that articulation of that thesis and that story, it was just like so spot on. I story, it was just like so spot on. I story, it was just like so spot on. I met him before the series A that Pat met him before the series A that Pat met him before the series A that Pat did. Um, and I remember being like, did. Um, and I remember being like, did. Um, and I remember being like, "This is it." Like, "This is the one." "This is it." Like, "This is the one." "This is it." Like, "This is the one." >> Did you lose the A? >> Did you lose the A? >> Did you lose the A?

>> Um, we had an early stage practice at >> Um, we had an early stage practice at >> Um, we had an early stage practice at the time, um, that we were really the time, um, that we were really the time, um, that we were really involved with, and we did lose the A, involved with, and we did lose the A, involved with, and we did lose the A, >> which I think is, you know, it goes back >> which I think is, you know, it goes back >> which I think is, you know, it goes back again to our to our and I don't try to again to our to our and I don't try to again to our to our and I don't try to do very many A's. It goes back to our do very many A's. It goes back to our do very many A's.

It goes back to our strategy which is you know even strategy which is you know even strategy which is you know even sometimes if you miss an early round for sometimes if you miss an early round for sometimes if you miss an early round for the great companies in the world there's the great companies in the world there's the great companies in the world there's always another round. always another round. always another round. >> Dude, we are doing a term sheet now for >> Dude, we are doing a term sheet now for >> Dude, we are doing a term sheet now for a company and we turn down the seed and a company and we turn down the seed and a company and we turn down the seed and we're doing the A. And I said to the we're doing the A. And I said to the we're doing the A.

And I said to the team like I will not lose out on a great team like I will not lose out on a great team like I will not lose out on a great company because we are too egocentric company because we are too egocentric company because we are too egocentric and arrogant to accept our mistake. and arrogant to accept our mistake. and arrogant to accept our mistake. >> Absolutely. >> Absolutely. >> Absolutely. >> So we're not going to do it. >> So we're not going to do it. >> So we're not going to do it. >> Ridiculous. No, I'm kidding. I just >> Ridiculous. No, I'm kidding. I just >> Ridiculous. No, I'm kidding. I just fired the seed team. Yeah. Uh, you can fired the seed team. Yeah. Uh, you can fired the seed team. Yeah. Uh, you can invest in one seed firm and one series A invest in one seed firm and one series A invest in one seed firm and one series A firm. firm. firm.

>> I mean, you guys obviously for the seed. >> I mean, you guys obviously for the seed. >> I mean, you guys obviously for the seed. Come on. Come on. Come on. >> I love it. I I'll take that actually. >> I love it. I I'll take that actually. >> I love it. I I'll take that actually. How about that? How about that? How about that? >> Which series? >> Which series? >> Which series? >> I would say Sequoia and Benchmark. I >> I would say Sequoia and Benchmark. I >> I would say Sequoia and Benchmark. I want to split my dollar. want to split my dollar. want to split my dollar. >> I'll take that. >> I'll take that. >> I'll take that. >> You're going to allow me to split my >> You're going to allow me to split my >> You're going to allow me to split my dollar. dollar. dollar. >> I'll take that. Rory O'Driscoll, who we >> I'll take that. Rory O'Driscoll, who we >> I'll take that.

Rory O'Driscoll, who we do a show every Thursday, he's do a show every Thursday, he's do a show every Thursday, he's brilliant. He always says with brilliant. He always says with brilliant. He always says with Benchmark, you know, reports of my death Benchmark, you know, reports of my death Benchmark, you know, reports of my death have been greatly exaggerated. I just have been greatly exaggerated. I just have been greatly exaggerated. I just find it so entertaining. find it so entertaining. find it so entertaining. >> So, and I think it's this firm that >> So, and I think it's this firm that >> So, and I think it's this firm that >> portfolio is so good on this. >> portfolio is so good on this. >> portfolio is so good on this. >> It's so good and they have the ability >> It's so good and they have the ability >> It's so good and they have the ability to reinvent themselves, right?

I mean, to reinvent themselves, right? I mean, to reinvent themselves, right? I mean, they hired EV, who's my old analyst, so they hired EV, who's my old analyst, so they hired EV, who's my old analyst, so good for them. good for them. good for them. >> Listen, this is always the rough with >> Listen, this is always the rough with >> Listen, this is always the rough with the smooth. Poor Peter. He's got to deal the smooth. Poor Peter. He's got to deal the smooth. Poor Peter. He's got to deal with that every day. No, I love that. I with that every day. No, I love that. I with that every day. No, I love that. I think he's fantastic. But seriously, you think he's fantastic. But seriously, you think he's fantastic. But seriously, you look at like your firework, your Lora, look at like your firework, your Lora, look at like your firework, your Lora, your Madness. I mean, the list goes on.

your Madness. I mean, the list goes on. your Madness. I mean, the list goes on. >> Sierra, I mean, unbelievable portfolio >> Sierra, I mean, unbelievable portfolio >> Sierra, I mean, unbelievable portfolio from this era. from this era. from this era. >> But again, everyone's like a benchmarker >> But again, everyone's like a benchmarker >> But again, everyone's like a benchmarker over like I don't I'd take any of those over like I don't I'd take any of those over like I don't I'd take any of those companies in my portfolio. companies in my portfolio. companies in my portfolio. What's been the hardest decision you've What's been the hardest decision you've What's been the hardest decision you've made in your career? made in your career? made in your career? >> Leaving Insight for Kleiner. >> Leaving Insight for Kleiner. >> Leaving Insight for Kleiner. >> I know a lot of people.

So, I I was >> I know a lot of people. So, I I was >> I know a lot of people. So, I I was Harvard undergrad, then went to Insight, Harvard undergrad, then went to Insight, Harvard undergrad, then went to Insight, and I left Insight pretty early. I was and I left Insight pretty early. I was and I left Insight pretty early. I was the first one to leave. We we hired the first one to leave. We we hired the first one to leave. We we hired classes of 10 back then. So, it was like classes of 10 back then. So, it was like classes of 10 back then. So, it was like 10 analysts, all really young kids 10 analysts, all really young kids 10 analysts, all really young kids coming out of school. And um the junior coming out of school. And um the junior coming out of school.

And um the junior the junior summer internship at Insight the junior summer internship at Insight the junior summer internship at Insight was literally dialing for dollars. I was literally dialing for dollars. I was literally dialing for dollars. I mean, it's it's incredible training mean, it's it's incredible training mean, it's it's incredible training ground. I called 50 CEOs a week. Like ground. I called 50 CEOs a week. Like ground. I called 50 CEOs a week. Like literally cold call. I mean this was 10 literally cold call. I mean this was 10 literally cold call. I mean this was 10 years a you know almost 15 years ago years a you know almost 15 years ago years a you know almost 15 years ago now. now. now. >> Don't laugh. What do you say? Hi it's >> Don't laugh. What do you say? Hi it's >> Don't laugh. What do you say? Hi it's Lucas from Lucas from Lucas from >> Hi I'm 19 years old.

I mean but it's >> Hi I'm 19 years old. I mean but it's >> Hi I'm 19 years old. I mean but it's it's amazing right because you have this it's amazing right because you have this it's amazing right because you have this platform where young people are platform where young people are platform where young people are empowered and they're able to grow empowered and they're able to grow empowered and they're able to grow within the organization and bring other within the organization and bring other within the organization and bring other people in as they need and you learn how people in as they need and you learn how people in as they need and you learn how to like navigate a process at n you know to like navigate a process at n you know to like navigate a process at n you know 19 20 21 years old. It's this incredible 19 20 21 years old. It's this incredible 19 20 21 years old.

It's this incredible training ground. But I was the fir I was training ground. But I was the fir I was training ground. But I was the fir I was the first one at Insight to leave my the first one at Insight to leave my the first one at Insight to leave my class. And it was hard because it was class. And it was hard because it was class. And it was hard because it was like it was basically like stepping off like it was basically like stepping off like it was basically like stepping off the linear path. Like most of my life the linear path. Like most of my life the linear path. Like most of my life had been like very linear decisions. Not had been like very linear decisions. Not had been like very linear decisions.

Not very hard to like take the SAT, do well, very hard to like take the SAT, do well, very hard to like take the SAT, do well, not very hard to accept Harvard and then not very hard to accept Harvard and then not very hard to accept Harvard and then not very hard to go to Insight even not very hard to go to Insight even not very hard to go to Insight even though it was a little abnormal at the though it was a little abnormal at the though it was a little abnormal at the time. Like it was a billion dollar fund time. Like it was a billion dollar fund time. Like it was a billion dollar fund when I went. But I think like going from when I went. But I think like going from when I went.

But I think like going from insight and leaving your comfortable insight and leaving your comfortable insight and leaving your comfortable class in basically, you know, private class in basically, you know, private class in basically, you know, private equity SAS and going to be the only equity SAS and going to be the only equity SAS and going to be the only associate on the West Coast in a place associate on the West Coast in a place associate on the West Coast in a place you didn't know, that was like that was you didn't know, that was like that was you didn't know, that was like that was a a little bit of a leap. Um, and I mean a a little bit of a leap. Um, and I mean a a little bit of a leap.

Um, and I mean that's my advice to all the all the that's my advice to all the all the that's my advice to all the all the young folks in their careers like you young folks in their careers like you young folks in their careers like you got to get off the linear path. You have got to get off the linear path. You have got to get off the linear path. You have to like it's the only way. Get off the to like it's the only way. Get off the to like it's the only way. Get off the linear path. linear path. linear path. >> It's so funny. I always say the safe >> It's so funny. I always say the safe >> It's so funny. I always say the safe path is so much less safe than you path is so much less safe than you path is so much less safe than you think. The risky path is actually less think. The risky path is actually less think. The risky path is actually less risky than you think.

Um, do you have to risky than you think. Um, do you have to risky than you think. Um, do you have to be in San Francisco if you want to build be in San Francisco if you want to build be in San Francisco if you want to build an amazing AI company? an amazing AI company? an amazing AI company? >> No, but it helps. It's like the kingm. >> No, but it helps. It's like the kingm. >> No, but it helps. It's like the kingm. It certainly helps. I think if you look It certainly helps. I think if you look It certainly helps.

I think if you look at some of the advantages that you have at some of the advantages that you have at some of the advantages that you have being in San Francisco, right, just the being in San Francisco, right, just the being in San Francisco, right, just the incredible amount of talent density, incredible amount of talent density, incredible amount of talent density, there are not very many people in the there are not very many people in the there are not very many people in the world that know how to work with these world that know how to work with these world that know how to work with these systems right now. That's just the systems right now. That's just the systems right now. That's just the reality. And many of them are stuck reality. And many of them are stuck reality. And many of them are stuck inside of two, three, four companies. inside of two, three, four companies.

inside of two, three, four companies. But the rest, most of them are in a very But the rest, most of them are in a very But the rest, most of them are in a very small radius in that in the Bay Area. small radius in that in the Bay Area. small radius in that in the Bay Area. It's not impossible, but it's kind of It's not impossible, but it's kind of It's not impossible, but it's kind of like why would you make your life like why would you make your life like why would you make your life harder? harder? harder? >> So, with that, do you think the 100 >> So, with that, do you think the 100 >> So, with that, do you think the 100 million to 500 million pay packets are million to 500 million pay packets are million to 500 million pay packets are actually justified? actually justified? actually justified? >> Yes. >> Yes. >> Yes.

>> I think they should give them to >> I think they should give them to >> I think they should give them to podcasters, too. Just putting it out podcasters, too. Just putting it out podcasters, too. Just putting it out there. there. there. >> You got this. I believe in you. >> You got this. I believe in you. >> You got this. I believe in you. >> Thank you so much. There's very few >> Thank you so much. There's very few >> Thank you so much. There's very few people who know how to do this very people who know how to do this very people who know how to do this very difficult job. Uh, penultimate one. difficult job. Uh, penultimate one. difficult job. Uh, penultimate one. What's the biggest miss that you reflect What's the biggest miss that you reflect What's the biggest miss that you reflect on most across your career? on most across your career? on most across your career?

>> Like mine is deal. It's not easy >> Like mine is deal. It's not easy >> Like mine is deal. It's not easy because, you know, if you've done this because, you know, if you've done this because, you know, if you've done this long enough, you have a lot of misses. long enough, you have a lot of misses. long enough, you have a lot of misses. >> A lot. >> A lot. >> A lot. >> I do remember very distinctly going and >> I do remember very distinctly going and >> I do remember very distinctly going and visiting Anderil for the billion-dollar visiting Anderil for the billion-dollar visiting Anderil for the billion-dollar round down in LA. And I was a SAS round down in LA. And I was a SAS round down in LA. And I was a SAS investor at the time. So why I was the investor at the time. So why I was the investor at the time.

So why I was the one who went to visit Anderville, I one who went to visit Anderville, I one who went to visit Anderville, I won't know. Um, but it was one of the it won't know. Um, but it was one of the it won't know. Um, but it was one of the it was a classic case of um back then I was a classic case of um back then I was a classic case of um back then I think my perspective was slightly more think my perspective was slightly more think my perspective was slightly more myopic, right? I was mostly focused on myopic, right? I was mostly focused on myopic, right? I was mostly focused on SAS, very focused on metrics. And if you SAS, very focused on metrics. And if you SAS, very focused on metrics.

And if you looked at that P&L, there's no way, you looked at that P&L, there's no way, you looked at that P&L, there's no way, you know, you're a P&L investor, there's no know, you're a P&L investor, there's no know, you're a P&L investor, there's no way you invest. Just is what it is. It way you invest. Just is what it is. It way you invest. Just is what it is. It was an ugly P&L. But it was an example was an ugly P&L. But it was an example was an ugly P&L. But it was an example of me missing the force through the of me missing the force through the of me missing the force through the trees. And um not seeing just how trees. And um not seeing just how trees.

And um not seeing just how special the founding the founding team special the founding the founding team special the founding the founding team was there, just how important that trend was there, just how important that trend was there, just how important that trend was, where the world was going, right? was, where the world was going, right? was, where the world was going, right? And that's an example of where, you And that's an example of where, you And that's an example of where, you know, Founders Fund got that right. A know, Founders Fund got that right. A know, Founders Fund got that right. A lot of people got that right. We got lot of people got that right. We got lot of people got that right. We got that wrong. Final one. What most excites that wrong. Final one. What most excites that wrong. Final one. What most excites you for the next 10 years? you for the next 10 years?

you for the next 10 years? >> Oh my god, I'm just I'm excited about >> Oh my god, I'm just I'm excited about >> Oh my god, I'm just I'm excited about the products. I think like this is one the products. I think like this is one the products. I think like this is one of the things that um of the things that um of the things that um it it it's ingrained in everyone that it it it's ingrained in everyone that it it it's ingrained in everyone that joins CO2 at the end of the day is we joins CO2 at the end of the day is we joins CO2 at the end of the day is we love technology, right? Like we're love technology, right? Like we're love technology, right? Like we're technology only firm. We love technology only firm. We love technology only firm. We love technology. We love these products. Um technology. We love these products. Um technology. We love these products.

Um and the ability to just like change our and the ability to just like change our and the ability to just like change our lives over the next decade and use so lives over the next decade and use so lives over the next decade and use so many new things I think is what has me many new things I think is what has me many new things I think is what has me most excited. I cannot wait for OpenAI's most excited. I cannot wait for OpenAI's most excited. I cannot wait for OpenAI's new device. Like we've it's going to be new device. Like we've it's going to be new device. Like we've it's going to be one of the first exciting new devices in one of the first exciting new devices in one of the first exciting new devices in some time. Like those types of things I some time. Like those types of things I some time.

Like those types of things I think is what I'm the most excited about think is what I'm the most excited about think is what I'm the most excited about is the products. Like using cloud code is the products. Like using cloud code is the products. Like using cloud code this year. Oh my god, it's incredible. I this year. Oh my god, it's incredible. I this year. Oh my god, it's incredible. I have to say you especially right on the have to say you especially right on the have to say you especially right on the Open AI devices. It's like what latest Open AI devices. It's like what latest Open AI devices. It's like what latest consumer device have you been like I consumer device have you been like I consumer device have you been like I would actually go and wait outside the would actually go and wait outside the would actually go and wait outside the store for when I was a kid.

Like I can't store for when I was a kid. Like I can't store for when I was a kid. Like I can't out for this thing. out for this thing. out for this thing. >> But the iPod Nanos and the I was like >> But the iPod Nanos and the I was like >> But the iPod Nanos and the I was like wow thousands. Like now with the new wow thousands. Like now with the new wow thousands. Like now with the new iPhones, let's be honest, like no one's iPhones, let's be honest, like no one's iPhones, let's be honest, like no one's like, "Yeah, I'm going to like run to like, "Yeah, I'm going to like run to like, "Yeah, I'm going to like run to the store." It's like, "Ah, whatever." the store." It's like, "Ah, whatever." the store." It's like, "Ah, whatever." This This This >> I've forgotten to trade mine in for four >> I've forgotten to trade mine in for four >> I've forgotten to trade mine in for four years.

I use like four generations old, years. I use like four generations old, years. I use like four generations old, you know? you know? you know? >> 100%. I completely agree. So, I'm so >> 100%. I completely agree. So, I'm so >> 100%. I completely agree. So, I'm so with you, Lucas. Thank you so much for with you, Lucas. Thank you so much for with you, Lucas. Thank you so much for doing this, dude. I've loved having you doing this, dude. I've loved having you doing this, dude. I've loved having you on. This has been fantastic. on. This has been fantastic. on. This has been fantastic. >> Awesome. Thank you.