Sandy Kory: The Founder Obsessed Investor Behind BillionToOne, BaseTen & Palantir

0:00I hadn't been everywhere in the world,

0:02but it did seem like Silicon Valley had

0:03a pretty amazing density [music] of

0:05talents, and so it's like, "Oh, this

0:06might be the smartest, most ambitious

0:08group of people in the world."

0:09>> know what Palantir was doing?

0:11>> bit. But they couldn't even describe it.

0:14They They Their business was was kind of

0:16a mess.

0:16>> Yeah, I remember having coffee with them

0:17in like 2008 and explained him the

0:19definition of revenue. You know, like No

0:21one there knew the definition of

0:22revenue. I mean, ironically, it didn't

0:23matter to the business. Like, they were

0:24making great progress. I was like, "You

0:26know, revenue has a specific, you know,

0:28technical meaning." Like, somewhere in

0:29the universe you should know this.

0:30>> You've been early to an incredible

0:33amount of names to the point where it's

0:35definitely not luck.

0:36>> Most of the conversations with investors

0:37are focusing on like that.

0:39>> So, you're not asking about the product

0:40at all.

0:41>> No, I mean I'm I'm I'm like 90% of the

0:42conversation is going to be on like the

0:44things you've done before the startup.

0:45>> There's a lot of contrarian things that

0:46you're saying.

0:47>> Sometimes founders are really like

0:48annoyed by it. They want to show me the

0:49slides. I'm like,

0:50>> Everyone looks at the slides.

0:51>> So, let me send me the slides

0:52afterwards. Like, "Sure, I want to look

0:54at that." So, yeah, I I think there's

0:56like more alpha, you know, the earlier

0:57you go, and I think there is more room

0:59for legitimately different approaches.

1:05>> Sandy, thank you for Thanks for joining

1:07me today. First in-person like podcast

1:09for the Delphi Show, and you're the

1:10first guest. So excited.

1:11>> I'm honored. Thank you.

1:12>> Yeah, for sure. Well, Sandy,

1:14um my colleague Ross and introduced me

1:17to you. Uh and he said, "You have to

1:19talk to this VC. He's brilliant." And I

1:21said, "Okay." I emailed you. You were

1:22gracious with your time. We spoke, and

1:25I'm like, "Damn, I got to get uh a

1:27podcast episode with him." So, so thank

1:29you for being here.

1:30>> Uh

1:30>> Maybe just to give a little bit about

1:32you. I'll give I'll give a brief intro

1:34on you. You're You're a VC, and you're

1:36the founder of Horizon, pre-seed and

1:38seed stage venture fund. And you've been

1:41early to

1:43like an incredible amount of names to

1:45the point where it's definitely not

1:47luck. Um That's what we were joking

1:50before. I mean, you've been early to

1:52Billion to One, Palantir, Canva,

1:55Facetune, Seed Invest, and just a

1:58laundry list of of names. So, I'm really

2:01happy for you to be here. Uh why don't

2:02you give us a bit of your background and

2:04and uh about yourself?

2:06>> Well, thanks again for having me. Um

2:08Well, so uh I guess my my background

2:12where you know where we begin. Um

2:14I uh you know, ended up graduating from

2:17uh Stanford you know, 20 25 years ago

2:19and

2:21that's when I first got exposed to

2:22venture capital.

2:24Uh and um you know, I was really

2:26fascinated with tech and

2:27entrepreneurship. Didn't really take to

2:29programming. Um venture capital seemed

2:31like this thing that the gods of Mount

2:33Olympus were doing and I would never get

2:35a shot never get called up. Um but uh it

2:38was it definitely kind of made an

2:39impression on my mind and and even going

2:42back to you know, when I was a kid, I

2:43was you know, I I loved numbers and like

2:46statistics, baseball cards, and then I

2:48learned a little bit about investing in

2:49the stock market when I was I don't

2:51know, 10 12 years old. I thought all

2:52that stuff was really fascinating. But

2:54then in

2:54uh you know, when I was in Palo Alto,

2:56that was really amazing to kind of see

2:58what tech entrepreneurship could could

3:00do and to see the role of of like VC.

3:02But yeah, that was totally not open to

3:04me. Uh so, I decided to um you know,

3:07basically try to go out and make money

3:09and uh you know, no one could stop me

3:10from angel investing. And so, I kind of

3:13uh kind of stumbled into investment

3:14banking. Uh I didn't really want to do

3:16Wall Street or anything like that. But I

3:18there was a kind of like a startup

3:19boutique M&A firm um in the Bay Area

3:22that I joined. And uh they found a a

3:25niche advising bootstrapped technology

3:27companies on mergers and acquisitions.

3:29And the job actually ended up being very

3:31sales-heavy, which was kind of funny

3:32because I never really thought of myself

3:34as a salesperson. But but I did pretty

3:35well and so made enough money to

3:38uh you know, fund the uh you know, the

3:40the angel investing hobby. And um so, I

3:44worked for a few boutique M&A firms in

3:46the Bay Area.

3:47Um in 2009,

3:49uh I uh made an angel investment in

3:52Palantir um in 2010 I got let go

3:57from my in the position I had and kind

4:00of had no choice but to start my own M&A

4:01firm. Um so in 2010 I kind of launched

4:05along with my partner Mike who's also my

4:07partner with with the venture fund. Um

4:09you know so we launched the M&A firm and

4:12it was a little slow going in the

4:13beginning. I had to raid the 401K to to

4:15pay rent. Um but then by 2012 it was a

4:18good cash flow business and so then it

4:20really kind of funded my my angel

4:21investing uh habit.

4:23>> That's a long app though 2 years of

4:25sounds like of no real income.

4:27>> Yeah yeah it's funny. I mean I I I've

4:29taken a lot of like personal financial

4:31risk um you know I wouldn't like advise

4:33people to to do that but I always felt

4:35comfortable. I always felt like I could

4:37make money and so when I was investing

4:40in uh Palantir it was like

4:42it was a I don't know half of my you

4:44know net worth at the time it was it was

4:46a lot but I kind of thought about it it

4:48was just just a silly rationalization. I

4:50thought about it like NPV. It was like I

4:52think I'm going to make money if I need

4:54to so I didn't mind you know putting you

4:57know significant you know dollars into

4:59Palantir and so so yeah so I was you

5:01know

5:02kind of we were getting the M&A firm off

5:04the ground and it was pretty lean but I

5:05kind of felt like I'd be able to to make

5:07money. Um but then I had this

5:09fascination with with investing and and

5:12like honestly like this like

5:14kind of

5:15crazy kind of competitive drive that I

5:18you know kind of pressed a little bit um

5:21but just thinking you know I'm going to

5:23see if I can make myself into a great

5:25venture investor. Like no one's going to

5:27hire me fine.

5:28>> It's what you always wanted to do.

5:29>> I'm just going yeah I'm just going to

5:29try to do this. See if I can kind of

5:31figure it out. And

5:33uh you know kind of it's I mean it's

5:35like

5:35you know like when I was a kid um like I

5:37taught myself how to ride a bike

5:39um and like we had a like a driveway

5:42that had a hill and um I basically would

5:45would to the top of the hill and there's

5:46bushes on the bottom of the hill and I

5:47would get on the bike and I would just

5:49plow through the bushes and and so I had

5:51a you know high pain tolerance and I

5:53didn't mind taking a few risks. Probably

5:54got some brain damage from that so

5:56>> Could we

5:57could we linger there for a minute like

5:59it it there that's a lot of like

6:01like core items in such a short amount

6:04of time like investing in Palantir,

6:06getting let go, starting a company are

6:09all like three really big decisions. Is

6:11that like within a month? Is that within

6:13a year? Like

6:13>> Uh yeah, I mean probably within 15

6:17months 16 months.

6:18>> Yeah.

6:19And throughout this episode I'm going to

6:20try and pull out like how you look at

6:24founders. And when we talked before the

6:26show it sounded to me like

6:28diligence in Palantir and like making

6:31this decision was like one of your

6:33initial forays into refining your

6:36founder lens, right? Like it was the

6:37start of it. So walk us through like how

6:39did you get so convicted to put half of

6:42your money into Palantir at that time?

6:45>> Yeah, I mean it it it was it was like I

6:48mean I had this this deep interest in

6:50angel investing and venture capital but

6:52it was it was as much like just a wealth

6:54management decision because it was it

6:56was really like you know the the worst

6:58of the financial crisis like March April

7:012009 and banks were failing

7:04and so

7:06you know I mean in hindsight it it was

7:08the bottom of the stock market and you

7:10could have put money in the stock market

7:11you were you know you could have bought

7:12real estate you know in San Francisco

7:13you would have done well. Um but for me

7:16I I was you know really unsure what to

7:18do with with the dollars I had in the

7:20bank account. And so you know when I was

7:22I did a graduate program at Stanford and

7:24I got to be good friends with a guy

7:26named Shawn Sankaran who's now the the

7:28CTO of Palantir. And I spent a lot of

7:31time with him you know we happened to

7:33have a bunch of classes together and

7:35work out together and I mean he was just

7:38amazing. And I would say that you know I

7:40was in a pretty big graduate program you

7:42know, if we could have voted you know,

7:44who's most likely to succeed

7:46Sham Madoff.

7:47Uh he was just amazing. Um and so, you

7:50know, he he went to another startup

7:51after

7:52university for a few years, but then he

7:54joined Palantir in I think 2007 as

7:57employee number 13 and I remember just

7:59literally him raving to me about how

8:01talented these people were. He talked

8:02about like Joe, Joe Lonsdale, Stephen,

8:05Stephen Cohen is one of the founders and

8:07and this is so this is like, you know,

8:08your buddy's with, you know, LeBron

8:10James and he's saying, "Oh, these guys

8:11are so good at basketball." I said,

8:13"What?" So, it kind of blew my mind and

8:15so then it was a couple years later,

8:17um

8:18uh I had the chance to invest in this

8:19like kind of bridge round uh a couple

8:21years later. So, yeah, he joined in 2007

8:24and and I wasn't even thinking about

8:26angel investing, you know, in Palantir

8:27at that time, but in the in you know,

8:30Sham, you know, pinged me in, you know,

8:31in like whatever March of 2009 saying,

8:33"Hey, we're doing like a little bridge

8:34round." They didn't need the money, but

8:36the world might be ending and I think

8:38Peter Thiel was actually still quite

8:40parochial about everything. Um so, uh

8:42>> He is again with moving to Argentina.

8:44>> Yes, yeah. Uh well, yeah, he's usually

8:47usually right. Um

8:48but uh so, they let like cats and dogs

8:51in like me and uh and and uh so, yeah,

8:54so I made that investment.

8:55>> So, it So, it sounds like for me looking

8:58at your story from the outside, you had

9:00somebody who you ranked really highly

9:03and this person comes to you and says,

9:05"I rank all of these people highly."

9:08>> Yeah, it was like a statistical, you

9:09know, like it was an inference and it

9:10was like like what are the chances, you

9:13know, that that these people are not

9:15like the most ridiculously talented

9:17people in Silicon Valley or at least

9:19they must be this must be one of the

9:21most talented groups and they also were

9:23incredibly dedicated, had this

9:24incredible mission and and, you know, I

9:27hadn't been everywhere in the world, but

9:29it did seem like Silicon Valley had a

9:30pretty amazing density of talent and so

9:33it's like, "Oh, this this might be the

9:34smartest, most ambitious group of people

9:36in the world, and you know, financial

9:39crisis, is crazy. I I I don't know

9:41if all my new listeners understand how

9:43bad the financial crisis was, but it it

9:45was terrible.

9:46>> It was crazy, yeah. Really was crazy.

9:47>> Like to I I don't know how to describe

9:49it. Like the world was literally

9:51failing. Everyone thought it was over,

9:53and you're over here writing checks.

9:55>> Yeah.

9:56>> That's Well, it's it's crazy. Yeah, and

9:57so it's like it it turned out that was

9:59the bottom, but uh

10:01>> Did you know what Palantir was doing?

10:03Like were you bullish that

10:04>> A little bit, but they couldn't even

10:06describe it.

10:07>> [laughter]

10:07>> They They Their business was was kind of

10:09a mess. I mean, I

10:11I remember like I was, you know, friends

10:13with Joe Lonsdale, who's just like

10:15amazing. I remember having coffee with

10:16him in like 2008 and

10:18explained him the definition of revenue.

10:20You know, like no one there knew the

10:21definition of revenue. I mean, I

10:23remember they didn't matter to the

10:24business. Like they were making great

10:25progress. I was like, you know, revenue

10:26has a specific, you know, technical

10:28meaning. Like someone in the company

10:30should know this. Uh and you know, so

10:32they've always done kind of interesting,

10:35you know, creative, you know, uh you

10:36know, contracting arrangements.

10:39Um it's worked out, right? And And like

10:41And so I take a lot from that. You know,

10:43it's like, yeah, you know, you know,

10:45knowing GAAP financials, okay, if you're

10:47going public, someone should know, but

10:49but much more important is like talent

10:51density, ambition. And so everyone, you

10:54know, like it they pretty much never

10:56raised money from top-tier VCs. Now,

10:58okay, Founders Fund turned out to be a

11:00top-tier VC, but, you know, the the the

11:02tier ones at the time, you know, all

11:04thought Palantir, you know, was a

11:05consulting business.

11:07It's

11:07>> 20 years ago almost.

11:08>> And sell you know, selling to the

11:09government. What a shitty What a shitty

11:10business. No one wants to sell to the

11:11government. Um and it's consulting. You

11:13know, what kind of what kind of business

11:14is that? Uh and so they were so

11:17radically contrarian in like so many

11:19different ways. Now, I wouldn't say

11:21every single way was, you know, value

11:23creating, but the culture of extreme

11:26first principle thinking um and and and

11:28true mission orientation, um that is

11:31something that is easy to, you know,

11:33kind of pretend, but they really they

11:35really had that. They really thought

11:36they were doing important things. So,

11:37yeah, they couldn't really explain the

11:38business model that well. They could

11:39kind of explain it because they were

11:41still working it out. How long did it

11:42take for you to make make the decision?

11:45He your buddy from college texts you,

11:47emails you, you get the pitch, you

11:49>> Yeah.

11:49>> What what was the turnaround time?

11:50>> I think I [clears throat] think I said

11:51something like uh

11:53you know, is there any information you

11:54can share? And and I'm pretty sure Joe

11:56sent this like long email. I'm pretty

11:58sure he like he was sharing it with

12:00other people. Um, and so uh yeah, it was

12:03a pretty quick decision. Uh it was a

12:05pretty quick decision.

12:06>> So, we're going to we're going to

12:07revisit this like your founder lens

12:08throughout the episode. This is a great

12:10foundation. But my last question on the

12:11Palantir side, why do you think your

12:13friend knew you would be receptive to

12:16angel investing? Like why did he reach

12:18out to you? You're not running a fund at

12:20the time. The M&A business I don't think

12:21has started yet. You're still at your

12:22job. Like how did he know that you were

12:24somebody that would understand this and

12:26pull the trigger?

12:26>> Probably the biggest thing was Sham was

12:30doing me a favor. You know, and he

12:32thought that I was like a smart person

12:33who could like understand opportunity.

12:35And they they I mean they had such

12:37incredible belief in the value of the

12:38company that you like I really think

12:40Sham was just coming from a place of

12:42like, "Hey, you know, you're a friend

12:44and we've, you know, we're we're good

12:45friends.

12:46You know, we both did favors for each

12:48other. I I did some consulting at the

12:49company uh or you know, even before

12:51that. And so, I knew a bunch of people

12:52there. And so, it was like, "Oh, let's

12:53send this good guy. Like let's let's let

12:55him in on this uh this special

12:57opportunity."

12:58>> Sandy, I need better friends.

13:00>> [laughter]

13:00>> I need this class of friends.

13:02>> Well, I'm I'm very fortunate. You know,

13:03I'm very fortunate.

13:04>> So, you

13:06did the Palantir investment, uh got let

13:09go, started doing M&A. How do you go

13:12from M&A to really refining this angel

13:17investing process? Cuz we're not at

13:18Horizon, your fund, yet. So, what

13:20happens between uh starting your M&A

13:22business and Horizon? Like what's in

13:24there?

13:24>> Yeah, I mean it was kind of like the,

13:26you know, the I want I want to have cash

13:28flow I kind of need to have cash flow to

13:30pay the rent. Like that was the M&A

13:31business. And you know that I would say

13:34the way

13:35you know I I wasn't the most successful

13:37person in M&A but we were pretty

13:38successful. Um you know I mean I I you

13:41know I I

13:43you know me and my partner Mike I mean

13:45we limited ourselves because we were

13:46intellectually honest. Um so you know

13:48you you you you know you have

13:50limitations in the industry when you're

13:51when you're you know scrupulous about

13:53certain things that we were scrupulous

13:54about. But we did pretty well and in my

13:57angle you know my um

13:59you know my my kind of sales pitch was

14:01that I was really good at understanding

14:03these these tech businesses. So these

14:05bootstrapper tech businesses. And the

14:07funny thing about bootstrapper tech

14:08businesses is like you know the more

14:09profitable the business is the the less

14:11likely you know the founders are to know

14:13the numbers. You know if you have a 50%

14:15profit business cares what the

14:17EBITDA margin is right? And so some

14:20outside you know VCs or bankers would

14:22look at that and be like oh god this

14:23what kind of founder is this guy? He

14:25doesn't even know what his EBITDA margin

14:26is but I kind of realized oh no no no

14:27this this is a very good value like you

14:29don't you know who cares? Um so so I

14:32really enjoyed being very analytical

14:33about these these uh these bootstrapper

14:35tech businesses and and and trying to be

14:37helpful and and give good advice and um

14:40so I I had like an investor in mind set

14:42and so it was it wasn't like a oh I'm

14:43trying to invest in you know the next

14:44Palantir but I was I think I was kind of

14:46turning my my uh you know kind of

14:48investing analytical you know kind of

14:50understanding tech businesses

14:51understanding the 82 different ways you

14:53know founders can kind of BS you. Um and

14:57uh and just you know kind of figuring

14:58out some of those kind of you know

14:59personas and archetypes. But then yeah

15:01then on the side you know once I had

15:02some money I was really interested in

15:04angel investing and so that was like my

15:06nights and weekends uh passion. And so I

15:08was but I was kind of leading a double

15:09life. I mean I was advising these

15:11bootstrappers that were in places like

15:12Saskatchewan and and Ontario and Texas

15:15and Florida. Um

15:17uh so that was like the day job and then

15:19nights and weekends I was you know

15:21talking to like YC startups and and, you

15:23know, just kind of shaking the tree,

15:25reaching out, trying to find interesting

15:26companies like all over the place, like

15:28Australia, Africa.

15:30Um, and um, it was great. I mean, it's

15:31funny cuz a lot of times the founders,

15:33you know, that I you know, I'd have a

15:34coffee on on a Saturday with some, you

15:36know, founders in a seed round and they

15:37hear I'm an M&A guy and they're like,

15:39"Oh, you want to sell me?" I'm like,

15:40"No, I'm not selling. I don't." Like

15:42it's hard and they don't No one believes

15:43me, but they're like, "I don't you know,

15:44I sorry, I threw the other hat on."

15:46Yeah, I mean, Palantir, like I don't

15:47want to sell Palantir. I mean, they

15:48would never hire me. They're they're

15:50never going to sell. Canva's never going

15:51to sell. And so so I did end up giving a

15:53lot of kind of free advice to struggling

15:55startups that I invested in.

15:57And so that was fine. I mean, I tried to

15:58kind of pay it forward.

15:59>> The The crazy thing though is like

16:01it's like for most people it's so hard

16:04to to context switch. Like just I mean,

16:07you have to like really I mean, the

16:09founders you look for for example, like

16:10you need to really focus on one thing,

16:13get those exponential returns, the the

16:15five nines, the nights and weekends,

16:16think about it in the shower. Here you

16:18are doing banking all

16:20>> so angel investing. And the craziest

16:21thing I think about the story about you

16:23is that this is such a deep and valuable

16:26skill set. Like banking, understanding

16:28the financials, being able to structure

16:30sales, like but now as a VC, like you

16:33don't have to use that anymore at all.

16:35Which is crazy to me. Like do you ever

16:37feel like, "Hey, maybe I want to dig

16:39into the numbers?" Or or is it

16:40>> Well, no, it is funny like I I realized

16:42because when I was doing M&A, I would

16:44run into VCs in the context of like M&A,

16:47their companies and I realized most VCs

16:49don't know jack about M&A.

16:51>> [laughter]

16:51>> Uh,

16:52but it it's because like you don't need

16:54to know because, you know, it's like if

16:55you invent like I remember reading about

16:56the story of how WhatsApp sold to

16:59Facebook. I mean, it was crazy. You

17:01know, like Zuckerberg like had a meeting

17:03like on a Friday and then they met it on

17:05a Saturday and Zuckerberg was like, he

17:07tells his corp dev team like, "We're

17:08going to pay $10 billion.

17:10Deal closes on Monday." Right? And some

17:12VC is like, "Oh, I just learned a lot

17:13about M&A." No, you didn't. This is like

17:15a one-off unicorn. I mean, great job,

17:17VC. Great job. But, uh so I just learned

17:21that yeah, actually like the M&A

17:22knowledge is I mean, it's interesting

17:23and and I can add value. Like, you know,

17:25we've had two you know, two portfolio

17:27companies in our Fund I that have sold

17:29with like nice exits. Um and in both

17:31cases, I would say I I I was able to go

17:33above and beyond as a VC to help out. Um

17:36and and I think founders appreciate

17:38that. Um and and there's a little bit of

17:40benefit to, you know, the the investors,

17:42but

17:43but they're, you know, small exits and

17:45and like the big wins in the portfolio

17:47will be companies like Palantir and

17:48Canva where it's like, you know, I don't

17:50care about anything I know about M&A.

17:51So, yeah, it's funny. But, I I context

17:53switching I think has always been, I

17:55don't know, kind of easy for me. Like,

17:56I'm not I never took a programming uh

17:58you know, I even though I was interested

17:59in tech entrepreneurship, but

18:01you know, maybe that I'm like ADHD. I

18:02could never, you know, kind of spend,

18:05you know, lock myself in a room for 12

18:06hours and, you know, do do coding. Like,

18:08for me, just bouncing around from from,

18:10you know, 5 minutes to this, 10 minutes

18:11to this, that context switching was

18:13always like a lot more natural.

18:14>> I definitely have a touch of ADHD and I

18:16I think it's such a valuable skill. So,

18:18you know, you need to jump around, go

18:19super deep. Um but but maybe to linger

18:22like

18:23it I feel like if you build up such a

18:26unique and deep skill set, like for you

18:29on the banking side,

18:31I feel like it's just very hard to

18:32mentally say, "I'm going to throw it all

18:34away." Like, did you actively make that

18:36decision or was it a shift over time?

18:38Like cuz you're successful at M&A, you

18:41want to do angel investing, and

18:43eventually you go on to start the fund.

18:45But, at some point you have to say,

18:46"Hey, I'm going to get rid of what I've

18:47done forever."

18:48>> Yeah, it's interesting. Uh I mean, for a

18:50while, I I was happy doing M&A and then

18:53doing, you know, angel investing on the

18:55side. Um but, I did deep down, you know,

18:59have a

19:00greater passion for investing. And uh I

19:03thought about doing a fund um yeah,

19:05probably for a few years before I did

19:07it. I had friends who uh who who had

19:10funds, and I saw that it was a real

19:12fundraising was real slog, you know, and

19:14you you know, emerging managers can you

19:16know, generally kind of trade you know,

19:17sad stories on and if you you know, so I

19:19didn't want to do that. Like in my M&A

19:20business, I did a lot of selling. And I

19:23did you know, like when I started out I

19:24was doing a lot of cold calls, and and

19:26it was fine, but I you know,

19:28for whatever reason I just thought if

19:30I'm going to do a if I'm ever going to

19:32try to do my own fund, um I don't want

19:34to do a lot of selling. I don't you

19:36know, I mean for me it was it's like you

19:38know, if I'm selling your business I

19:39know mine, pounding on doors if I

19:41believed that your business is viable. I

19:43don't mind telling everyone like this is

19:44but I just didn't want to be the guy

19:46pounding on doors saying give me money.

19:48I just that just

19:49Some people do that, but I didn't want

19:50to do that. I wanted it to be kind of

19:51like a down field it's a different sales

19:53experience. Yeah, so so what happened

19:55was in in 2021,

19:57um I mean hey, that was a great year and

19:58I said you know, I learned you know,

19:59market great markets make us all uh

20:02think we're you know, smarter and better

20:03looking than we really are. So I was

20:04very smart, very good looking 2021. Um

20:07and you know, I I didn't bring in people

20:09into some of the deals that I did over

20:11the years. I brought a couple people in

20:12the Canva for example.

20:14Um

20:14uh

20:15like my business partner and my my

20:16father and a friend and so that worked

20:18out great. I mean my my business partner

20:20in M&A I didn't want him to be

20:22upset that I mean he was working 100

20:24hour weeks in M&A. I was working 100

20:25hour weeks too, but

20:27big chunk of that was angel investing.

20:28You want to align the incentives.

20:29>> I want to make sure yeah.

20:31>> So um but so I started bringing people

20:32into the deals and um some of the a few

20:34of the ones I brought people in you

20:35know, didn't work out, but in that it

20:37worked out. And I brought people into

20:38billion to one for example like there

20:40was a bridge round between the A and the

20:41B

20:42um and so that's that's been great. Um

20:44and you know, I

20:45I didn't even do like an SPV. I just put

20:46together like a partnership. I was like

20:47hey guys, I'm not going to make any

20:48money on this, but I think this is a

20:49good deal. Like like kind of like what

20:50Cham did to me for for Palantir. Like he

20:52didn't say oh, I'm going to do an SPV.

20:54He was just trying to be friendly. So so

20:56I brought people into deals and then in

20:572021 we did some SPVs. Um we had we had

21:01two SPVs actually in a in a client um

21:04that we had a bootstrap technology

21:05company and we had it was kind of a

21:06special situation. We had high

21:08conviction and and it you know six

21:10months later you know we returned like

21:12one and a half two x capital and there's

21:13still some more for so so 2021 you know

21:16it was it was you know we had some exits

21:19and so and I had kind of made people

21:21money over the years investing and then

21:24in M&A and so I thought late 2021 I

21:26thought now is the time

21:27>> to do the fund.

21:28>> Do the fund. And so and and so that

21:30everyone that I you know asked to invest

21:33in the fund it was like M&A clients and

21:35it was like hey you know you you trust

21:37me right? I mean if I if I sell you a

21:38business we have a high trust

21:39relationship. It's really hard raising a

21:41fund to establish the trust right?

21:44So

21:45you don't know if you're right for a

21:46long time.

21:48Yeah so I had this high trust you know

21:49kind of a foundation and and my the

21:52business part of my cup a lot as well.

21:53So so like I kind of you know cringe cuz

21:56you know I know fund raising can be such

21:58a grind for a lot of like really good

22:00investors but for us for fund one it

22:02really wasn't a grind. It was pretty

22:04downhill. Um so we raised a you know and

22:06so so that was the you know I kind of

22:08thought okay now is the time to do a

22:09venture fund

22:11and and then I said I'm just going to

22:13leave the M&A behind and basically

22:15initially with with my partner Mike I

22:16was I was kind of like hey you know I

22:18can I can help out on the side

22:20but he's a self-sufficient guy and he he

22:22he won't going to need me. So I said so

22:24it's his it's his business. So yeah so I

22:25kind of left you know I left the you

22:28know

22:28almost all the cash flow you know for we

22:30had a little bit of a of a sharing you

22:32know for a couple of years but but I

22:34kind of was at peace with saying I'm not

22:36going to take any of the M&A cash flow.

22:38I'm just going to live on on the

22:39investing.

22:41And you know we'll see how that works

22:42out but I'm okay with it.

22:44>> Gee and

22:45so it's it's it's just a wild arc right?

22:48Because you you're at Stanford and this

22:50is something you always want to do and

22:51it took

22:53I don't know 15 years or

22:54>> Yeah I mean I get I mean probably 20

22:56years from like you know so like I

22:57there's this one class we took that was

22:59taught by VCs and it was basically yeah

23:0120 years later or you know, when it was

23:03like, "Okay,

23:03>> the listeners, it's never too late.

23:05>> Yeah, yeah, that's right. I mean, like

23:06Ray Kroc started McDonald's when he was

23:07like 54, right? You know, I mean, I'm

23:0946, so I got I got 8 years to to, you

23:11know, mess around before I really get

23:14get, you know, started.

23:15>> So, I want to I want to do a couple more

23:17like portfolio company examples and then

23:20we could get into like your founder lens

23:22cuz I think these examples really

23:23demonstrate what you look for, how you

23:26found them and things like that. Um

23:28you were

23:30the I think the earliest investor in

23:31Billion to One at a $4 million

23:33valuation, which is just nuts cuz I

23:35think they're at 4 billion now. Like,

23:37that's an insane return in a good way.

23:40Um

23:41let's walk through Billion to One a

23:42little bit. How did you find that

23:43founder? Like, what did you think at the

23:45time? How did you end up pulling the

23:46trigger? Let's linger here for a little

23:48bit.

23:48>> Yeah, sure. In I would say the, you

23:50know, if I if I looked at the the most

23:52successful investments I've had, there's

23:54not like one way that I meet founders.

23:56It's a bunch of different ways,

23:58um for better or for worse. And so, in

23:59that case, um

24:02Y Combinator briefly had a program

24:04called the YC Fellowship. Uh and it was

24:06basically like it didn't even involve

24:08investing, but it was kind of you know,

24:10there at the time

24:12some people were complaining that, you

24:13know, YC was kind of demanding too much

24:15traction. And so, YC was kind of like,

24:17"Oh, we're going to make a minor leagues

24:18and you can be without traction, you can

24:20be in a YC Fellowship and we're not

24:21going to give you anything, but

24:23>> Earlier in the process.

24:24>> Yeah.

24:25Uh and so, and I think they thought

24:26maybe it could be like a feeder uh to

24:28YC. They canceled it after like a year

24:30because it it whatever. Um

24:32So,

24:32>> They should have kept it.

24:33>> So, yeah, they should have. TechCrunch

24:35had an article about YC Fellowship and

24:37had like the six companies. And so, I

24:38looked at the six companies and I think

24:40I reached out to three of them. Um that

24:42looked interesting. And so, one of them

24:43was Billion to One. And you know, I kind

24:45of had a a thought that wasn't an

24:47original idea, but just the intersection

24:48of of, you know, software and and bio,

24:51you know, there there seemed something

24:52interesting there. Like, actually a

24:54couple years earlier I had, um you know,

24:57talked to Benchling and uh

24:59um I I took too long to pull the trigger

25:01and then around closed, but I I knew

25:03that was like a really exciting company.

25:04So, anyways, that was interesting to me.

25:06So, I I reached out to those guys and

25:08and they were, you know, happy to meet

25:09for coffee in San Francisco. And um

25:12yeah, I mean, at the time there were

25:13three founders. One subsequently left.

25:15But, they were all like just brilliant.

25:18Um they all were just just about to

25:19finish their PhDs. Um you know, I I uh

25:23I think all three of them were PhDs at

25:24Stanford, like undergrad, like the one

25:26went to Princeton and um one went to

25:28Rice. Um and uh they were just, you

25:31know, brilliant and there was just like

25:33a kind of a kinetic energy. Like they

25:35were kind of raw and like no one would

25:38say they were good fundraisers, but they

25:39were very honest. And and, you know,

25:42ironically like I slept through biology

25:45in ninth grade. Uh and so, I I didn't

25:47know anything about what they're doing.

25:49But, I don't, you know, I I guess I

25:51have, you know, curiosity and I I like

25:53to ask questions and listen. And so, I

25:54asked them like really basic questions

25:56and I was impressed at how they kind of

25:58explained everything that they were

25:59doing. And um you know, I find that's

26:01that's a nice signal of a great founder.

26:04Like yeah, being really smart helps, but

26:06there are some people who are really

26:07smart who just can't really explain

26:08things for whatever reason. And I think

26:09that's a that could be a real negative

26:11because you, you know, if you're doing

26:12something highly technical, you need to

26:14be able to build a business, especially

26:15like in kind of healthcare, you need to

26:17be able to, you know, communicate

26:18effectively with a lot of different like

26:19levels of of, you know, background

26:21knowledge and such. So, um that really

26:23made a big impression on me. Like really

26:25good at explaining this incredibly you

26:27know, technical concept. Um and then I

26:30felt like I kind of got it and I kind of

26:31understood. And they were clearly like

26:33not bullshitters. They were just not

26:35people who were going to who were going

26:36to be bullshitting. And so, I was still

26:38like, "Okay, well." Uh and they were,

26:39you know, so, they were just super

26:40intellectually honest about the risks

26:41and things like that, but it seemed

26:42like, "Okay, well, these mousetraps are

26:45doing this and this

26:47could be a better mousetrap and these

26:49guys are just, you know, I mean, really

26:51uh,

26:52brilliant and uh super energetic. And

26:54so, I mean, it was a pre-seed

26:55investment, but, um, but yeah, so like I

26:58wrote a I wrote a, you know, at the

26:59time, for me, like a small check, um,

27:02and then I kind of helped them, you

27:04know, informally over the next month as

27:06they were raising money. And I just

27:07really liked the way they were

27:08interacting.

27:09Uh, and so I I did like a, you know, I

27:10doubled that small check. Um, and then,

27:13uh, like a year later, they raised a

27:15little bit more money at the $4 million

27:16valuation. And they, you know, they were

27:18like, "Hey, you know, we're going to

27:19take a little bit money at at this

27:21valuation. You know, we like you. Would

27:22you like to, you know, so I kind of, you

27:23know, these are small numbers, but I

27:25kind of double down. And so, at Building

27:274 One, it was the company that I I, you

27:29know, wrote the most checks in, uh, over

27:31time. I wish in hindsight they'd have

27:32been bigger checks, but but but I, you

27:33know, all in, it was, you know, they the

27:35company that I put the most money in as

27:37an angel. So, that's nice. Not to

27:40not to like overly spend time just on a

27:42metric, but so you were in before a $4

27:44million valuation. At the $4 million

27:46valuation. They raised money at the same

27:47valuation a year later, uh, just a small

27:49round. Um, so they, you know, they just

27:51like they probably raised, you know,

27:53300,000 in that first tranche. And then

27:55they probably raised another 300,000

27:57like a year later. So, I I want to just

27:59want to like just go back to that

28:01meeting, right? Like, you're at this

28:03meeting, you meet these three founders.

28:05You you're not deep on bio, but you

28:08found them yourself, you're interested.

28:09They're really intellectually honest

28:10with you, they're explaining things

28:12well.

28:13But you like I'm trying to figure out

28:15like how you got the conviction there

28:18and then. Like, what like I'm trying to

28:20like piece together and pull out like

28:22what it is exactly that impressed you.

28:24There's I can give you a few more

28:25details. I'll also say though that it's

28:28it's tempting to like, you know, be

28:30overly optimistic about it, um, because

28:32I did other investments in in 2016, uh,

28:35that I was also excited about.

28:37This is the the best one. Um, but um,

28:41yeah, I mean, look, they were they were

28:42high-achievers, um, and like

28:44subsequently, I actually learned a lot

28:45more. Like I, you know, I met, you know,

28:47people who went to school with these

28:49guys in like undergrad and I heard these

28:50funny stories about how they were you

28:52know, and you know, I I just look you

28:53know, like Okay, so the CEO was like the

28:56you know, top you know, scorer in like

28:58the the you know, that I think that the

29:00master science exam you know, in you

29:02know, high school in Turkey and like I

29:03don't think I asked him about that and

29:05then you know, when I when I was first

29:06meeting him but like I heard that

29:07subsequently. But um like they had this

29:09story. So his father had a like a

29:12medical clinic um in you know, like the

29:15small city he grew up in Turkey and they

29:17had this story about like for for what

29:19they were doing they needed like some

29:21blood samples. And so he um say this. Uh

29:24but basically he kind of smuggled some

29:26blood samples from from the lab uh from

29:29his doctor's from his dad's practice uh

29:31into the US, you know, like in like a

29:33coat or suitcase or something like that.

29:35I mean, it's not the James Bond-ish.

29:36Yeah, not the not the most criminal

29:37thing but I mean, but these were people

29:39like these are like very like

29:41rule-following people.

29:42Um and so I could get a sense like but

29:45there was like this dedication, this

29:46determination. Um and so there was this

29:48you know,

29:49off the charts intelligence, this like

29:51dedication, determination. There were

29:53what seemed to be like really

29:54interesting insights into the into a

29:56market opportunity you know, and and

29:58technology. Also, the three founders,

30:01they were all um you know, like very

30:03knowledgeable about you know,

30:05biochemistry and the science but also

30:06like very

30:07So sometimes you'll find someone who's

30:09you know, some PhD in in you know,

30:11biology um I don't really know much

30:14about program. So I really like the fact

30:15all three of them were were like you

30:17know, it it seemed you know, extremely

30:18like versatile in terms of what they

30:20could do.

30:21>> You mentioned like briefly that one

30:23founder ended up leaving. Like, did that

30:26um change your your thesis or initial

30:28read or that happen later or

30:30>> Not really. So I mean, it's funny like

30:32with with Billion to One, I mean, it

30:33like honestly like I've never invest I

30:35mean, I've invested in some great

30:36companies but but I've never had a

30:38company that like every single time

30:41um like has overachieved and and they're

30:43like investor updates is is a topic that

30:46comes up with founders and and VCs and

30:48some founders will do them like monthly

30:50some won't do them at all and Billy Dunn

30:52has always done them quarterly. They've

30:53done they've done them like very

30:54professionally, um, in terms of the the

30:56style and the cadence but they always

30:59overachieve. And so in the beginning

31:01when I first invested, you know, they

31:02thought that the market opportunity was,

31:05uh, going to be like in India and East

31:08Asia. They thought that regulatory in

31:10the US was going to be harder and so

31:11their initial plan was to target, you

31:13know, like beta thalassemia was like a

31:16it's like a genetic disease that is

31:17like, you know, relatively common in in

31:19Asia less common here and so they kind

31:21of thought they would they would be

31:22targeting, uh, that market and so one of

31:24the founders, um, you know, was Indian

31:26and had relationships in like India with

31:29like some hospitals, government and so

31:31so what happened is maybe it was like

31:33six months into the company they they

31:35realized that they could actually go

31:36into the US early and that was a better

31:38market. And so then the third guy who

31:41was going to be like the guy in India, I

31:42think he wanted to go back to India but

31:44it wasn't so so that was kind of so, you

31:46know, in that case it was and and they

31:48were always super transparent about

31:49everything. Um, so there was no

31:51questions about like, you know,

31:52integrity or anything like that. Um, and

31:54it was actually like it was a it was

31:55kind of a function of like the

31:56opportunity to be even greater because

31:58the it was like, "Oh, the US, great.

32:00Yeah, better market, great.

32:03Overachieving, great." And I kind of

32:04like

32:06brush over this a little bit but like

32:07what did what is, uh, Billy Twin doing?

32:10>> And what were they doing when you

32:11invested? Is it the same story

32:13originally on the product side just more

32:14so for the listener?

32:15>> Yeah, well, so they're they're, you

32:17know, like they're, you know, they're so

32:18they're they're public and and they're,

32:20you know, right now about a hundred

32:22million dollars, uh, in revenue a

32:24quarter, uh, it's a four hundred million

32:25dollar revenue run rate, you know,

32:27roughly and you have a hundred percent

32:28growth and they're actually quite

32:30profitable which is very unusual for a

32:31for a diagnostics company. Um, so maybe

32:34ninety percent of their revenue is, um,

32:36what they call NIPT, which is

32:38non-invasive prenatal testing. So,

32:40basically it's blood tests for pregnant

32:42women

32:44and kind of the cool science is just

32:46that

32:47like in the past to do a blood test on

32:49to see if the baby, you know, that the

32:50fetus has some, you know, a risk for a

32:52genetic disease, you need mom blood and

32:54dad blood and it's like if mom has a

32:56gene and dad has a gene, oops, that's

32:58that's probably a risk.

32:59You know, certain certain genes.

33:01But what actually what happens is

33:02there's there's you know, fetal DNA in

33:05the mom's blood and so they can take mom

33:07blood and they can test for kind of the,

33:09you know, fetal genetic risks.

33:11And so that's called NIPT and so it's

33:13basically a blood test for

33:14pregnant women.

33:15And then 10% of their revenue growing

33:17faster, the bigger probably bigger

33:19commercial opportunity is in like the

33:21the oncology or cancer market and that's

33:23called liquid biopsy. It's kind of the

33:25same science which is basically looking

33:27for a needle in a haystack or you know,

33:28billion to one, that's you know, looking

33:30for like one in a billion. And so, you

33:32know, if if

33:33you know, after a cancer treatment,

33:35often you have to wait to see if it's

33:37going to come back. You take a little

33:38bit of tissue, you do a biopsy. So, the

33:40idea with a liquid biopsy is like after

33:42you have a treatment for cancer,

33:43cancer's in remission, take a blood test

33:45to see if there's any like lingering

33:47pieces of of cancer which is

33:49going to be like the there's like kind

33:50of mutant DNA of the of, you know, from

33:52the cancer which is, you know, it's kind

33:54of So, basically what they're looking,

33:55you know, their their technology is is

33:57like a chemical microscope. It's not a

33:59microscope, it's it's chemistry, but

34:00they effectively have like the most

34:02powerful microscope,

34:03you know, period. And so they can look

34:05at it with like a single molecule

34:06resolution

34:08to detect these like tiny bits of like

34:10mutant DNA, you know, like for with a

34:13mom, like I'm being facetious, but you

34:15know, the the fetus has different DNA so

34:17you're looking for that DNA and then in

34:18cancer, you know, sadly, you know, it

34:20also has kind of mutant DNA. It sounds

34:22like a a needle in a haystack because

34:24you're getting the baby's DNA from the

34:26mother and then another needle in a

34:27haystack cuz you're looking for

34:28abnormalities in the baby.

34:30>> Yeah, yeah. And then the

34:31like of their of their approach is that

34:34like like the kind of traditional

34:35approaches are basically, you know, like

34:39using chemistry, but but amplifying. So,

34:41like we have a little bit of blood, like

34:43let's kind of like magnify it. Not with

34:45a magnifying glass, but but effectively,

34:47okay? But when you do that and if you

34:48ever think about, you know, intense

34:50magnification, you get noise. You know,

34:52if you took like a penny and you put it

34:54in a you know, in a in a microscope and

34:56you you blew it up like there's it

34:57becomes kind of blurry, it's noisy,

34:59right? And so, what they basically do is

35:01they have a really you know, like unique

35:03proprietary way of like putting some you

35:05know, putting like a little bit of like

35:07DNA fragments in the sample that they

35:09know and then they like blow it up to

35:11like a million times resolution, but

35:13they, you know, because they know, you

35:15know, what to expect based on like a

35:17like spiking the sample,

35:19then they can basically kind of

35:21take the noise out.

35:23And so, they can, you know, blow up

35:24something to like a million X, you know,

35:25resolution chemically

35:28and and see it with with, you know, like

35:30perfect resolution.

35:31>> Um that's so cool.

35:32>> It's pretty amazing.

35:33>> It's yeah.

35:34>> It's it would sound so scientific back

35:36then. And it it worked out.

35:38>> So, I I want to like

35:40not round out and close, but I want to

35:42round out these two examples and like

35:45kind of like figure out what your

35:46founder lens is. Most VCs will look at

35:50the project, they'll look at the TAM,

35:51they'll look at like what's hot this

35:53quarter, what's on YC's list, they'll

35:55look at

35:56all these different factors figure out

35:58where they think they should be

35:59investing

36:00>> and probably losing money.

36:02>> Um you have a very different approach in

36:06being hyper focused on the founders,

36:09right? Your your story with Palantir,

36:11your story with Billion to One like

36:14signifies that. But you

36:17it's not like random. Like you've

36:18refined this focus, you figured it out,

36:21and now it's like something a lot of VCs

36:23talk about like we're hyper founder

36:25focused, but it's it it feels like

36:27you've been doing this like the longest.

36:31Like I don't know. Like me I don't know

36:32where to start with this question, but

36:34like when did you like make the overt

36:37decision like I want to hyperfocus on

36:40the founder? Or is it something that you

36:43kind of grew into? And and let's just

36:44talk about those.

36:45>> Sure. Well, okay. So, I undergrad I

36:49majored in psychology. So, and I

36:51probably before then had interest in

36:52psychology. And so, that that's not

36:54exactly founder focus, but I probably

36:56had more of a predilection for that

36:58direction. Like it's I'm not a CS major.

37:00So, I'm not you know, like you know,

37:02hacking on the on the you know, on the

37:04project to you know, and so

37:07with early stage venture, I think one

37:09thing that's fascinating is that there

37:10are different approaches that are that

37:11are successful. And so, there are some

37:12super founder focused people who are

37:13successful, but there's also people who

37:15are super market focused. There's you

37:16know,

37:17there's there's some astrology.

37:19But I think there's persistently

37:20successful people who have different

37:22approaches. At later stages, I think it

37:23converges. And if so, if you're you

37:25know, a growth stage investor or you're

37:27pre-IPO investor, like you're all kind

37:29of doing the same thing. Okay, there

37:30there's a few little things driven, but

37:32but it's you know, like don't

37:33>> The story's working. You're Yeah.

37:35>> It's legible, right? But at the at the

37:36earliest stage. And so, I think that

37:39there's more legible

37:41Sorry, there's more alpha for like what

37:42I want to do

37:44you know, as early as possible where

37:46it's like most I mean I guess

37:48you know, I mean my my my you know, my

37:51ambition this is a very flattering

37:52comparison, but it's a little bit like

37:53billion to one. You know, looking for

37:55the needle in the haystack, right? Where

37:56it's extremely hard to see. Like what

37:58billion to one is doing is very valuable

37:59cuz it's so freaking hard.

38:01>> So, the early stage is ridiculously

38:02inefficient.

38:03>> What's that?

38:03>> The early stage is ridiculously

38:05inefficient.

38:05>> efficient. I mean it's getting more

38:06efficient. And I think you know, and so,

38:08like there are some founders you know,

38:10at the idea stage who are like kind of

38:12consensus obvious founders. And and

38:15maybe I would invest in those. I would

38:17think I think that's a little less

38:18interesting. Now, I wouldn't say they're

38:20guaranteed success. I'm just saying you

38:21know, like Elon Musk is doing some

38:23startup today, you know, that's lots of

38:25people would say, oh, I should

38:26definitely invest, right? So, and maybe

38:28that's from a pure, you know, alpha

38:30perspective, you should do that, but I

38:31think intellectually that's not so

38:33interesting.

38:33>> There will be another Elon Musk like

38:35>> Yeah, probably not.

38:36>> Hopefully, yeah, probably not.

38:37>> That's that's I don't know.

38:37>> Something maybe remotely close.

38:39>> Yeah.

38:40>> Yeah. Uh and there's yeah, it's

38:41fascinating.

38:42>> Um

38:43>> So, uh so yeah, I I think there's like

38:46more alpha, you know, the earlier stage

38:47you go, and I think there is more room

38:49for legitimately different approaches.

38:51And so, it's like I think I have a, you

38:53know, potentially I have a lane um to to

38:55be, yeah, super founder focused. I'm not

38:57the only one, but I think that I have a,

38:59you know, set of experiences and and you

39:02know, some theories and a track record

39:03that gives me, you know, gives me

39:05conviction that I can do this properly.

39:07Um but I haven't always been

39:10this. I mean, I would say that as an

39:11angel investor, I experimented with a

39:13lot of different approaches. I mean, I

39:14definitely, you know, at times would be

39:16focused on traction.

39:17Um like, hey, oh, you're raising at a at

39:19a, you know, $5 million valuation and

39:20you've got, you know, $500,000 in

39:22revenue, like

39:23count me in. Like I don't I don't care,

39:25you know, and and you can say, well, you

39:26know, hey, uh this founder, you know,

39:29has $500,000 of revenue, they haven't

39:30raised anything, like must be pretty

39:32good.

39:33>> It's validated.

39:34>> Yeah, yeah, and so you I mean, so that,

39:36you know,

39:37I'm not ignoring the founder quality,

39:39but you can look at other signals more

39:40closely. You can say, oh, traction. Or

39:41you can just say like market. Like, oh

39:43my god, this this founder has this

39:44insight um into this market opportunity.

39:46Like, oh, no no one has made um yeah, no

39:49one has made uh

39:51you know, tablet-based sales automation

39:53software for a for pharmaceutical sales

39:57reps. Oh, no one's done that before. Oh,

39:59that's a good idea. Oh, we founded

40:01Veeva.

40:03>> [laughter]

40:03>> Good good idea. That was a good market.

40:05You know, I mean, Salesforce was getting

40:07inbounds um from, you know, pharma

40:09companies with sales reps

40:11um and they wanted software on on

40:13tablets, on iPads in like, you know,

40:152007 or something like that. And and

40:17Salesforce didn't want to make software

40:19for tablets, you know, and they were

40:21like, "Oh, let's have a platform." Uh

40:23hey, Viva has got some farm links.

40:25Uh and uh one thing led to another and

40:27so that I mean great founders. I'm not

40:29Like there was a market opportunity

40:30there and and that company if you had

40:32just been, you know, market focused uh

40:34probably you would have done Viva and

40:36you would have done great.

40:37>> But for you though, you're you've

40:39figured out like hyper-focusing on the

40:42founders is is the correct path for you.

40:44And and this is the lane you want to be

40:45in and it's clearly it's clearly

40:47working, right? And it's clearly

40:49something that I think will continue to

40:51work unless someone like

40:53like uh backs into like what you're

40:55looking for from this episode and

40:56pitches you and then Yeah, are you ever

40:58worried about that?

40:59>> Yeah, maybe I should be. I mean I'm more

41:01worried about AI just, you know, so you

41:03you're you know, you can outdo this

41:06um by, you know, from some AI, you know,

41:08so that that to me seems like, "Okay,

41:10like I'm a good chess player, but AI is

41:12going to be better than me one day."

41:13Uh or or it is better than me. So, yeah,

41:16I I guess the way I talk to founders um

41:18you know, in the first conversation is I

41:20try to go pretty deep on their

41:21backgrounds. It's It's kind of

41:24interesting, you know, you talk to a

41:26founder that's been working on a startup

41:28for, you know, it could be two months.

41:30It could even be a year or two. And I

41:32think most most of the conversations

41:33with investors are focusing on like

41:35that. Like tell me about the idea, tell

41:36me about the business model, tell me

41:37about you what you did in the past like

41:39>> not asking about the product at all.

41:41>> No, I mean I mean I'm like 90% of the

41:43conversation is going to be on like the

41:45things you've done before the startup.

41:46>> Okay, that's extremely different from

41:48what every most of you see.

41:49>> It's sometimes founders are really like

41:50annoyed by it. They want to show me the

41:52slides. I'm like

41:54Sorry, you know, I'm sure everyone looks

41:55at the slides. I'm sure they're nice,

41:57but I don't really care that much, you

41:58know.

41:59So, I mean send me the slides

42:00afterwards. Like sure, I want to look at

42:02that. Um and I and I and I do care, you

42:04know, like I would say that, you know, a

42:06founder might have some impressive um

42:08achievements and and and

42:10characteristics, but then in talking

42:11about the business that they've been

42:13working on for a month, if it like

42:14doesn't make any sense, I might pass.

42:16Now, I can think of examples where I

42:18pass and then they pivoted into like a

42:20better idea and they're doing great. So,

42:22where it was like, you know, they the

42:23analysis of their life before the

42:25startup or before the idea was like, oh,

42:27this is a good founder, but then I'm

42:29like, that's a stupid idea. I'm not

42:31going to invest. And then they they

42:32pivot so

42:34I think there's a lot more signal in the

42:35life before the startup. Interesting.

42:38>> So, what do you though like

42:40It the the thing that I struggle with

42:41with it and I agree with your approach,

42:44but the one thing that I struggle with

42:46when hearing about founder stories is if

42:48they're a founder, they most likely had

42:50a pre-hard upbringing, right? They they

42:53fought, they got ahead, they've done

42:55these things, they've been successful,

42:56they haven't been successful. How do you

42:58gauge the relative

43:01uh

43:02hardness of their life and then their

43:04outcome?

43:05>> Yeah, okay. So, so I I think that the

43:07founder trauma thing is a little over

43:09done.

43:09>> I totally agree.

43:10>> And I mean and now it's like I want to

43:12you know, I want to

43:13tread lightly because I don't you know,

43:15we all have different experiences. It's

43:16it's ironic like, you know, take any

43:18person on the planet and there will be

43:20like, what's the worst thing that

43:21happened to them? And there are some

43:23people where it's like the things that

43:24they've been through is unimaginably

43:26bad. And there's other people where like

43:28compared to that it's like nothing, but

43:29it was still the worst thing that

43:30happened to them and it was traumatic at

43:31the time. So, I really, you know, you

43:34know, want to be like respectful, but

43:35like from my understanding, you know,

43:37there are some great founders like say

43:39Mark Zuckerberg or Bill Gates that came

43:41from like good families and had pretty

43:43good upbringing. And I don't know

43:45exactly, but

43:47I think that there's or you know, Larry

43:48Page.

43:49So,

43:51I'm not sure that the trauma thing is

43:53actually that that that that useful and

43:56I think it, you know, and then and then

43:58yeah, and then it's like everything's

43:59relative, right? So, it's like I I do

44:01think you need to look for like absolute

44:03signs of outliers.

44:05And and it can be in different different

44:07ways. And I would it is it's a fun

44:08challenge like, you know, if you're a

44:10basketball scout, you're like, well,

44:11that person is 7'5". You know, okay,

44:13that's clearly, you know, but I'm more

44:15interested in in these things that are

44:17like, you know, less legible. So, one of

44:19our portfolio companies is is a smart

44:22glasses company. And, you know, the

44:23founder, I think he's probably I think

44:25he's like 29 now.

44:27Google Glass came out when he was in

44:28high school and like that changed his

44:31life. He was just obsessed with AR. And,

44:35uh, you know, in high school he you

44:36know, and then he it's like he went to

44:38he went to Georgia Tech and after

44:40investing I met someone who actually

44:41went to school with him and it was like,

44:42oh, yeah,

44:43he's obsessed. They were in the same

44:44like engineering lab. And he said, oh,

44:46he he's obsessed. He was always wearing

44:47his Google Glass, yeah.

44:48Uh, and he and he he dropped out. He was

44:50chill fellow, dropped out, did a did a

44:53company in this space, raised a little

44:54bit of money, didn't have success. This

44:55is his second company. And so, you know,

44:57Tom Suarez, I mean, he's he's a great

44:59founder. I mean, his personality is very

45:01different, um, than than some other

45:03founders. Um, but like in in his case,

45:05like the to me, the signal is like this

45:07obsession,

45:09um, with, um, you know, with this

45:10technology and this this product. And

45:13then he's also like the polymath. Um,

45:15and he's he's self-taught and so he can

45:17I mean, he he, you know, can write

45:18software backwards and forwards. Um, he

45:20can tell like talk about like waveguides

45:22and and and optics. And, uh, and

45:24there's, you know, making that type of,

45:27uh, you know, piece of technology

45:27requires like extreme depth in like lots

45:30of areas. And so, now, I don't have

45:32depth in any of those areas. But I think

45:34I'm pretty good at picking up on on like

45:36someone that really is legit across

45:38these areas. And then,

45:39you know, often I'll get, you know,

45:41reinforcement just talking to other

45:43people that that are, you know,

45:44world-class experts. And I'll be like,

45:45yeah, Tom

45:46does this stuff. And I'm not discounting

45:48that the trauma. It's horrible to have

45:50to go through anything. It's just hard

45:52it's always been hard for me to figure

45:53out like the relative trauma versus

45:55another founder cuz everybody, like you

45:57said, has been through something

45:58terrible, right? So, it's hard. If you

46:00had to pick the things that you that you

46:02look for, it sounds like you're looking

46:04for obsession. It sounds like you're

46:06looking for people who were previously

46:09like self-starters, had hints of

46:11success, or failure it sounds like is

46:12fine with you too historically. It

46:14sounds like you look for founders who

46:15could explain technical things to a

46:17broad crowd. Like are those the those

46:20obviously aren't all the main things,

46:21but like what would you say are the the

46:23main things? Is it just this I want to

46:25go really deep on your life, figure out

46:26if you're an outlier, and that's the

46:28lens?

46:29>> Or

46:29>> Well, so it's I guess it's you know

46:31signs of extreme potential. And they you

46:33know unlike in basketball where there's

46:35only like a few things. There's like

46:36you're tall or you could jump really

46:37high, right? Or you're Steph Curry you

46:39could shoot like like a you know like an

46:41X-Man. But uh but there's so there's

46:43lots of ways that this can express, but

46:44just a sign of like a extreme talent in

46:46in in you know an area or two. And then

46:49it's in you know an absence of

46:50negatives. And that that's important.

46:51Like there's founders where I detect,

46:54you know, um like bullshitting, like

46:56lack of intellectual honesty, overly

46:57commercial. Now, I might get things

46:59wrong by the way. I mean no no one firm

47:01is going to get everything. Um I I also

47:03um really uh care about missionary over

47:06mercenary. Now, I'd say that that's

47:07something where I I have my perspective

47:09has evolved.

47:10>> Missionary over mercenary Okay.

47:11>> Yeah, where um

47:12>> So you would take the Anthropic founders

47:14over the founders who moved to Meta.

47:17>> Yeah.

47:17>> I see.

47:18>> Totally. And it's like I think it's like

47:19you know and I mean you know you might

47:21say obviously obviously missionary over

47:23mercenary. Like look what Anthropic has

47:25done to Open AI. It's crazy. Like a year

47:27or two ago no one would have would have

47:28Well, maybe just a few people would have

47:30been on it, but um so I but but I would

47:32say like no actually a lot of VCs don't

47:33don't care about that. Um and there are

47:35cases and I not to you know

47:38pick on too many people, but like I

47:39would say there's companies like Uber or

47:41Facebook that I think they were I don't

47:42think they were that mission-driven.

47:43Maybe they kind of would say things, but

47:45they were super competitive, really

47:47smart, and you wanted to win. And then

47:49so that's all good as capitalism.

47:50>> But is the

47:51>> But not mission-oriented.

47:52>> Is the missionary an output from the

47:55founders' obsession? Like they're so

47:56obsessed that they want to build this,

47:59would you say? Or

47:59>> Yeah, I think so. And and then there's

48:00like a there's a

48:02um

48:03you know, there's I I think there's

48:04something you know, they they think

48:05there's something good about this about

48:07what they're doing. And I think that I

48:09don't know, I think there's something

48:10good about this. I think then attracts

48:12talent. So talent density, you know,

48:14talent magnetism magnetism is like

48:16really important.

48:16>> I mean, it might be the most important

48:17thing, frankly. Like like and so if I

48:19you know, if if I make an investment um

48:21and you know, 2 years later, you know,

48:23you're the you've got a crystal ball,

48:25you know, and you're you're going to

48:26tell me like like what what data point

48:28about I made the investment yesterday, 2

48:30years from now,

48:31um you know, I you can you'll tell me

48:33one thing about what's going on in the

48:34company. Like for me, it would be, you

48:37know, tell me something about like kind

48:38of talent gravity. Like the you know,

48:41tell me the caliber of the engineer that

48:43just joined.

48:43>> It's crazy cuz that is now going back to

48:45where we started with Palantir.

48:47>> Yeah. Yeah, like if you can get Shawn

48:49Sanker to run your company, you're

48:50killing it.

48:52You know?

48:52>> How do you

48:54um

48:54like this is all by definition

48:57subjective? Like you do your DD, you're

49:00talking to these founders, they're

49:02obsessed? Are they seven out of 10

49:04obsessed? Are they overcome these

49:06things? Or or can they attract talent?

49:08Like this is all a scale. Like do you

49:11ever find yourself

49:13um

49:14I don't know, like on the edge of that

49:16scale? Or are all of these thing these

49:18investors are making blowing you away

49:19across the spectrum? Trying to get a

49:21sense of where you make the decision

49:23along a subjective scale of a founder.

49:25>> It's it's tricky and I've evolved like

49:27from the first I don't know, 5 years

49:29when I was actively angel investing, I

49:31did like rankings, you know, I would

49:33rank like you know, founders and market

49:35and this and that.

49:36But now but I would look at the data

49:38afterwards. It just was noisy, you know?

49:40So there I mean, there's probably

49:41someone who can do a quantitative system

49:44uh and you know, maybe using like LLMs.

49:47So

49:48it's a good question. Um Uh, I I think I

49:51guess it's Well, I guess you know, like

49:53Peter Thiel has a line is like, you

49:54know, if there if you like something

49:55like half as much, you don't write a

49:57check half as big, don't invest. So, you

50:00know, there is something like gut, you

50:02know, I I hate, you know, there's some

50:03cliches that I think are kind of

50:05pseudo-scientific like gut or or art and

50:07science. Um, it's just to me it's just,

50:09you know, the science isn't to that

50:10good. Um, so yeah, my science isn't to

50:12that good. But, uh, I I do think that,

50:16um, when I reflect upon it and I'm

50:18thinking, um, and I guess I there's like

50:20other, you know, mental, uh, kind of

50:22heuristics that I have. And and like

50:25there's there's a another great

50:26investor, um, is this guy, uh, Jason

50:29Lemkin from, you know, Saastr. And I've

50:31heard him say that what he thinks, cuz

50:32he was a successful founder. I mean, he

50:34wasn't like, I guess, the best founder

50:36ever, but he was very successful. And he

50:37says he wants to invest in CEOs that are

50:39better than him. That's how he And I

50:41like, okay, that's that's Now, that

50:43won't work for me, you know, I'm

50:44kind of was a CEO of a little company,

50:46but um, but so, um,

50:49uh, yeah, so one thing that I think

50:50about is so, some people who are like

50:53super market focused. Okay, here's a

50:55founder that has an interesting market

50:56inside. In my experience, like I've I've

50:58invested in some of those companies over

50:59the years. Um, but what's going to

51:01happen is that in the next like 6 months

51:02or a year, there's going to be four

51:04other funded startups. Sequoia is going

51:06to back one, and they're going to be

51:07good, you know, Kleiner's going to back

51:08one, you know, Andreessen's going to

51:09back one. And so then So, my kind of

51:12heuristic is kind of like, okay,

51:14you know, to take, uh, to take a

51:15founder, um, you know, Jim Belosic of

51:17Send Grid Send, it's kind of like, okay,

51:18the competition is coming.

51:20It's coming. Like you can't, you know,

51:22like is he going to, you know, are they

51:23going to,

51:24uh,

51:25are they going to, um, you know, am I

51:26going to be confident? How am I going to

51:28feel? And it's like, cuz I've had

51:30companies where I invested, and then

51:32some of those came to the market, and

51:33I'm like,

51:34oh boy, I'm worried. But then I've I've

51:36I've had others, you know, and like

51:37building the one is like this, uh, where

51:38it's like, oh, you know, 100 competitors

51:40came to the market, oh, this is going to

51:42be fun. You know, if I was an investor

51:44in like SpaceX or like Elon companies,

51:45I'd probably to same way, you know,

51:47they're like

51:47>> But that's a good heuristic though. So,

51:49the idea is if you meet a founder, you

51:51and you're you know that they're going

51:53to be successful, there will be new

51:55entrants cuz this is clearly a big idea.

51:57>> have like a a high-quality market, you

51:59know, or like an earned insight, if they

52:01have a you know, like it's definitely

52:02something that you want. You want

52:03someone with like a quality earned

52:05insight.

52:06Um but I think you also have to think to

52:07yourself, okay, guess what? There's

52:09going to be, you know, a bunch of funded

52:10if it's as good an insight as you think,

52:12there's going to be really badass

52:14like Sean Sanker is going to

52:16join or start a company uh coming you

52:18know, and like how are you going to feel

52:19about that?

52:20>> And you the question you ask yourself is

52:22is if this happens, is the founder we're

52:24investing in able to beat

52:26>> how am I I mean, I feel like it's

52:27inevitable it's going to happen. If it

52:28doesn't happen, it means the market

52:29wasn't there. Interesting.

52:31>> And and these founders have to beat

52:33those probably more well-funded

52:36versions of themselves.

52:37>> Probably. So, they have to be like great

52:39at execution, you know, you know, like

52:40what does that mean? I mean, I guess

52:42really the founder lens, it's all of

52:43this is what it's all about. It's So,

52:45Ozan from Building to One is a maniac at

52:48execution. Now, he's got a great team.

52:50He's got founders smarter than him, but

52:51like that I mean, that you know, him or

52:53you know, Sean Sanker, uh you know,

52:55Ramp, uh those guys, you know, I'm not

52:56like an early investor or anything like

52:57that, but insanely good at execution,

52:59you know? If I was like an early

53:01investor in Ramp, I would you know, I

53:02remember people you know, people were

53:03talking about like Brex and Ramp, you

53:05know, and and I and I was just you know,

53:07popcorn like,

53:08smart people like let's see what

53:10happens. And I guess it you know, if I

53:12was a a Ramp investor, you know, I'd

53:14like to think I'd remember

53:15>> like, yeah, bring it on. Bring it on.

53:17Like we're going to we're going to be,

53:19you know, on top in the end. Maybe to to

53:21also round out your founder lens, is

53:24there a project where you were really

53:27close on pulling the trigger, like

53:29checked a couple boxes for you, and you

53:31ultimately didn't make the investment

53:33for some reason? Cuz I'm trying to get a

53:34sense of like I know where your where

53:36your max is. I know where you'd pull the

53:38trigger. I don't know where you wouldn't

53:39pull the trigger.

53:39>> Yeah. Okay, so I mean, I would say that

53:41the ones that that come to mind are when

53:43there does seem like there's a quality

53:45inside when there's some traction as

53:47well. And then particularly with the

53:48traction that I like is

53:51you know, there there's you know,

53:52customers are coming to you. You know,

53:54you don't have to work that hard for the

53:55customers.

53:56And so so there's some traction there.

53:59There's a nice insight. You see a market

54:01opportunity. But then it's like kind of

54:03the founder and okay, are they going to

54:05recruit great people? What I see a lot

54:07is

54:09like I'm just not convinced that they're

54:10going to recruit like great people.

54:11They're not going to try to recruit you

54:12know, Sean. They're not going to try to

54:13recruit like amazing people. And I think

54:15it's really you know, in my you know,

54:17like by the way, I don't like I don't

54:18really want to give advice to anyone. I

54:20guess it's like the you know, the

54:21founder's fund like let's have founders

54:23who don't really but of course I'm I'm

54:24happy to give advice. I'm happy to do

54:2624/7 do whatever I can for founders. But

54:28it's like I don't want to have a debate

54:29with a founder about like you know,

54:30hiring philosophy.

54:32What I would say like YC is just like

54:34hire your smart friends. And you know,

54:37like there's 500 YC companies. That's

54:39probably going to work for a few. But

54:41but I want a founder who's going to try

54:43to hire like the best people they can.

54:45You know, and so it might be their

54:46friends. I mean, if you went to MIT and

54:48you were doing math camp when you were a

54:50kid like okay. But but so you judge that

54:52though like

54:54based on your read of their

54:56their skill set. Yeah, and and then what

54:58and their hiring, you know, like so so

54:59this is the like hiring is something

55:01where I mean, you might be great at a

55:02lot of things. But I think a lot of I

55:04think a failure mode for a lot of you

55:06know, so there are a lot of successful

55:08startups you know, in the sense that

55:09they you know, have a A B or C but they

55:11they you know, slow down. They don't

55:13scale. Like you know, I would and then

55:14there's you know, there's different

55:16you'll hear different you know, stories

55:17for why companies you know, kind of slow

55:19down and you know, don't work. But I

55:20would say the biggest thing is is you

55:23know, hiring quality. You know, and it's

55:25and it's could be related to hiring too

55:26fast. I mean, it's theoretically

55:28possible to go from you know, 20 people

55:30to 60 people in a year and keep like a

55:33really high bar in hiring and keep like

55:34a strong mission orientation. It's

55:36but it's unlikely. You know, and I've

55:38just seen I mean it's it's just really

55:39hard to to keep that. And so um now

55:42look, it's probably a you know, if I'm a

55:44pre-seed investor and you went from 20

55:45to 60,

55:47not everyone is like an A+ like it's

55:48still probably a a pretty good

55:50investment, but um as a seed stage, you

55:52know, you you've you know, you you're

55:54you're you've got a founder and you've

55:55got, you know, two engineers and I'm

55:57asking about your your you know, who's

55:59on your team or who you're going to hire

56:00next, you know, and I'm I'm thinking

56:03like are you really trying to get like

56:05the best people on the planet? I mean

56:07it's hard. You don't have 24 hours to do

56:08recruiting. But that's it So So that's a

56:11big signal for me is like I'll I'll get

56:13check on a lot of things, but then I'm

56:14just not convinced you're really going

56:16to push hard on hiring like the best

56:19people you can.

56:20>> Okay, that is really really interesting.

56:22So if you're on the fence, this is the

56:24like one area you you'd fall back on to

56:26make your decision, you'd say?

56:27>> Yeah.

56:27>> Okay.

56:28And okay, that is really interesting.

56:31And maybe I want to circle back to one

56:33question I I missed. On your founder DD,

56:37um

56:38I'm curious how long it takes you to get

56:41comfortable. Is it the first call and

56:43everything after is like validation,

56:46checking for red flags? Is it I want to

56:48talk to mom, dad, best friend? Like

56:51Yeah, what what Yeah.

56:52>> I don't put much stock in references. Um

56:56I I really don't.

56:57>> There's a lot of contrarian things here

56:58you're saying, which

57:00>> I mean I will do some references

57:01sometimes.

57:02Um I mean so the most recent investment

57:04I made and I think you you know the the

57:06company. Um

57:08So that one like I did some references

57:10and they were they were good, but like

57:11of course they were good. Um now the you

57:13know, if if there was a cheat on that

57:15one, it's that I talked to the founder a

57:16couple times

57:18uh

57:19before their fundraising. And then a

57:20couple months later I I talked again.

57:22And so that was a cheat. Like I got

57:24extra signal there. Um and so yeah, I

57:26really liked the founder a lot. Um if he

57:29if And the first conversation they were

57:30like, "Oh, we're raising a round. It's

57:31going to next week." Would I have

57:33invested? Uh I'd like to think I would

57:35have. Um but I but I I couldn't tell you

57:36like really, right? So so that's

57:38something. Um and that's kind of like

57:40the case-by-case thing about But I I I

57:42definitely I mean there's definitely

57:43some great VCs who are like, "Oh, I can

57:45tell what I need in 10 minutes." Um and

57:48uh

57:49I I I think people can do that.

57:50>> Masayoshi Son who does that in 10

57:52minutes. He just blows billions of

57:53dollars.

57:54>> Yeah, and I would say that's that's

57:55pseudoscience. Yeah. Uh so it's like I

57:57don't want to do that, right? I want to

57:58be I want to So yeah, you can definitely

58:00get like big negative signals in 10

58:01minutes and know this isn't good. You

58:03know, and you can get big positive

58:04signals, but I do Yeah, I do want to

58:07want to kind of reserve judgment to a

58:08certain extent. But I but I you know, I

58:11like people uh well, I like founders. I

58:13mean the founders I talk to I have you

58:14know, I screen somewhat. So I'm talking

58:17to great people. So honestly like I kind

58:18of fall in love, you know, like every

58:20day with a founder.

58:22>> Before you get to know them though.

58:23>> Yeah, but then I have to reel myself in

58:24knowing, okay,

58:26but you know, as an angel investor it's

58:27kind of easier because you could you can

58:30You know, and and and some of those will

58:32will probably do well, but like as a you

58:33know, as a venture fund I have like a

58:34really high bar. So then I have to you

58:36know, unfortunately, you know, say no a

58:38lot. I mean some of those people say no

58:39to me by the way, but but but like the I

58:41guess the my question is like

58:43>> on the velocity of the conversation.

58:45You're talking to a founder. Are you

58:48continually impressed and more excited

58:50or as you dig do you get more questions

58:53and that leads to more conversations and

58:55like I'm trying to figure out like where

58:57you make the decision to talk to a

58:58founder where it's like I'm clearly

59:00understand that this founder fits my

59:03founder lens. Like could it happen in an

59:05hour? Does it take 10 hours? Yeah, I'm

59:07just I'm just trying to get a sense of

59:08that.

59:09>> Yeah, I mean I would say it's probably,

59:10you know, to get a good read is it's

59:12probably anywhere from 20 minutes to an

59:15hour. Um and it's like I cuz and then

59:18you know,

59:20I do think there are some people who can

59:21get a really quick read, but I also

59:24think a lot of founders are coached and

59:26did do what you said before.

59:28So, about like a founder I could just

59:30kind of say the things they think you

59:31want to hear.

59:33Um

59:33>> But they're not coached on telling their

59:34like life story.

59:35>> They're not. That's right. That's right.

59:36So, I think that's but it takes a little

59:37bit of time to like unpack that. And I'm

59:39not trying to be that There's no Yeah, I

59:40mean it

59:41It would be easier if I'm like, you

59:42know, I only invest in people who have

59:43like the most dramatic childhoods ever,

59:45>> [laughter]

59:45>> right?

59:46>> You probably do okay.

59:47>> Maybe there's a you know, there's a you

59:49know, there's all sorts of rooms for

59:50esoteric funds Yeah, I think someone

59:52should have a a fund to invest in

59:55identical twins.

59:56Um I think identical twins like can be

59:57really good founders. There's like two

59:58of you. I'm not identical to so I feel

1:00:01like I'm the wrong guy. But yeah,

1:00:02there's all sorts of good ideas. So,

1:00:04yeah, there's super dramatic And I

1:00:05haven't I I had a pretty good childhood.

1:00:07So, I think the the VC who's going to

1:00:08own the I only invest in people with

1:00:10like

1:00:11you know, super tragic childhoods.

1:00:14Probably you should have a super tragic

1:00:15childhood. Um so, that's not me.

1:00:17>> One one other question I had was you

1:00:19mentioned the absence of red flags,

1:00:21which I thought was interesting because

1:00:23when you meet these like exceptional

1:00:25founders that, you know, dug themselves

1:00:27out of caves and have done like

1:00:29spectacular things, I feel like most of

1:00:31the time they kind of push the limit a

1:00:33little bit like ethically or morally

1:00:35somewhere and like, you know, they went

1:00:37too far and they reined it back in. Like

1:00:38they have this general sense of

1:00:40overachievement and sometimes that goes

1:00:41the wrong way, but they still could

1:00:43become an incredible founder. But to a

1:00:46VC that would look like a red flag. Like

1:00:48how do you view like I guess what is a

1:00:51red flag to you?

1:00:52>> Well, so I would also say I think I'm

1:00:54going to miss a few of those. I think

1:00:56I'm going to be a little harsh on that.

1:00:57But I would say that, you know, if you

1:00:59told me that when you were 13 you were

1:01:01stealing cars, like honestly, like

1:01:03that's not a red I mean I mean it it

1:01:05could be part of a

1:01:07you know, but it's like I'm a I'm not

1:01:08that judgmental.

1:01:09>> As long as you're still not stealing

1:01:10cars.

1:01:10>> Yeah, exactly. Exactly, you know. So,

1:01:13and if you're being honest about it,

1:01:14right? So, it's it's more about how you,

1:01:15you know, how you And so, I calibrate

1:01:17based on on age, right? And so, people

1:01:19and yeah, if I'm talking you know, I'll

1:01:21you know, there's kind of a thing these

1:01:23days about oh, I invested in the

1:01:24youngest founders and I've I've I've

1:01:26definitely met some incredibly good, you

1:01:28know, compelling founders who were 16,

1:01:3018, 19. So, you know, I would I would do

1:01:32that and you kind of calibrate. I mean,

1:01:33obviously, if you're investing, someone

1:01:35has to have a certain amount of

1:01:35maturity, but if you're a 19 year old,

1:01:38I'm going to evaluate things a little

1:01:39differently than if you're 29. Um so,

1:01:42yeah, I think

1:01:44it's kind of case by case, but but for

1:01:45me, I you know, so maybe I over index on

1:01:47this, but but I care a lot about your

1:01:49intellectual honesty. And so, like, will

1:01:50you tell me just just the straight, you

1:01:53know, the straight truth of of, you

1:01:55know, what happened to you, what what

1:01:57you think happened to you when you were

1:01:58younger, or you know, you know, and and

1:01:59and I guess, you know, fast forward, you

1:02:01know, with founders that I've invested

1:02:02in, and as an angel investor, like I

1:02:04invested in over 100 companies, and so

1:02:06I've kind of seen it all. I mean, I had

1:02:08a

1:02:10at least one that was like fraudulent.

1:02:12So, it's like I've seen a lot, right?

1:02:13And so, it's like I just want to have

1:02:15founders that are going to be, you know,

1:02:17honest with me about about the company.

1:02:19Um

1:02:20>> I think it's also like just maybe just

1:02:21like zoom out, like it is really hard, I

1:02:24think, for a lot of founders to be so

1:02:27radically honest at that age because

1:02:29even 19-year-old kid really hasn't

1:02:30experienced the world coming to a

1:02:32successful VC like you, they want to put

1:02:34on a a good face. They want to be

1:02:36impressive. They want to tell the story

1:02:38the way they pitched their mom and dad

1:02:40and and people. Like, it's hard to find

1:02:42that.

1:02:42>> It's hard to find. So, I probably would

1:02:44maybe miss a few good founders by being

1:02:47a little harsh there, but I also think I

1:02:48would calibrate. And I guess another way

1:02:49to think about it is is back to the

1:02:52talent magnetism, right? I mean, can

1:02:54they if a 19-year-old has an incredible

1:02:56co-founder, you know, who's 18 or 28,

1:02:59you know, that that's a signal. You

1:03:00know, have they gotten other people on

1:03:02board? Like, that's a signal.

1:03:04And if they, you know, if they tell me

1:03:06about the, you know, the two people who

1:03:07joined them on the team, I can kind of

1:03:09gauge there, and I'm like, oh, wow,

1:03:11those that sounds like really impressive

1:03:12people. Like, they trusted this person.

1:03:14And so, yeah, maybe they're a

1:03:1519-year-old who's a little bit

1:03:16performative that's what YC tells them.

1:03:18Like so I I can get comfortable with

1:03:20with different styles. It's just I think

1:03:22I think it's like I want, you know, fast

1:03:24forward a year later, I just want

1:03:26someone who's going to be honest with me

1:03:27about about what's working. I mean they

1:03:29can be confident, um but I also want

1:03:31someone who's who's open to saying,

1:03:33"Okay, this thing isn't working out,

1:03:34right?" Um and that is, you know, it and

1:03:37and that gets back to learning. Like the

1:03:38best founders and the best back to like

1:03:40the, you know, Ougazones and Nishant

1:03:42Shankars, like they're learning

1:03:43machines. And so it's like

1:03:44deconstructing what are the things that

1:03:46lead to that? And I think people who

1:03:47are, you know, bullshitting other

1:03:48people, bullshitting themselves, just

1:03:50kind of gets in the way of learning.

1:03:52>> Yeah, it also just like it creates so

1:03:53many issues. Like I think if you're just

1:03:55so transparently open, no ego,

1:03:58authentic, not in a mean way cuz I think

1:04:00that's stupid. Like the radical

1:04:02transparency thing I get I think is

1:04:04screwy, but I think if you lean on the

1:04:06side of more transparency, more

1:04:08information, everybody around you could

1:04:09make way better decisions.

1:04:11Um and I've always felt that way within

1:04:13Delphi, too. Just always always makes

1:04:15sense. Um you you also um is your

1:04:19partner Mike is not at Horizon full-time

1:04:21or

1:04:21>> Right. So he's full-time M&A. Um I mean

1:04:25he works like a like a maniac. And then

1:04:27on the fund, he like we kind of tag team

1:04:31on fundraising. And then he handles uh

1:04:34most of finance legal. Okay.

1:04:35>> The reason I ask is because like for me

1:04:38I have my partners Jan, [snorts] Aneel,

1:04:40Jose. I they could tell me, "This is

1:04:41dumb. You're being stupid. Like back it

1:04:43up. This doesn't make sense." You know,

1:04:45"I spoke with the founder. I didn't get

1:04:47the read you got." Like things like

1:04:48that. For you,

1:04:50cowboy, right? You're single single guy.

1:04:52Like

1:04:52>> I had a I had a associate working with

1:04:54me for, you know, maybe uh half of the

1:04:56fund's history and she was she was, you

1:04:58know, good and and uh super smart. And

1:05:00so I valued her perspective. So yeah, we

1:05:02we would definitely be open to hiring

1:05:03another person. And I, you know, I'm

1:05:05open to, you know, I'm not actively

1:05:07looking for a partner, but I'm kind of

1:05:08intellectually like anyone who's who's

1:05:10great, who can add value, like I would I

1:05:12would you know we're not going to have

1:05:1410 people join the firm, but I would I

1:05:16would be open to that. But you know,

1:05:17working in a small company like the

1:05:18chemistry is really important and so

1:05:20it's it's it's tricky.

1:05:20>> so I'm wondering like how do you keep

1:05:22your

1:05:24like bar so high? Like who do you

1:05:25intellectually spar with on this stuff

1:05:27to

1:05:27>> Myself.

1:05:29>> Okay.

1:05:29>> I mean I I am

1:05:31definitely a very harsh critic of

1:05:33myself.

1:05:34>> But how do you do that?

1:05:34>> I could be you know, I could be better

1:05:37at being a a harsh critic of myself.

1:05:39Um but but yeah, I mean I'm constantly

1:05:41you know, thinking about my just

1:05:43thinking about decisions I've made, the

1:05:45process I have in making decisions. I'm

1:05:47constantly like I love what I do, you

1:05:49know, it's like

1:05:50you know, I loved sports when I was a

1:05:51kid and so if you had told me when I was

1:05:53a kid I could have been like the GM of

1:05:54some pro sports team that probably would

1:05:56have seemed like the perfect job

1:05:57assuming I couldn't make the NBA which

1:05:58you know, but when I was 80 I wouldn't I

1:06:00wouldn't have conceded that just yet. Um

1:06:01but it's like if you're you know, if

1:06:02you're the GM of a sports team and you

1:06:04love sports like you're probably you

1:06:05know, always thinking about like who's

1:06:06who's the better you know, who's got a

1:06:08better jump shot or who's who can you

1:06:09know, you know, who's got a better

1:06:10fastball and you're always you know, so

1:06:12like I'm always thinking about the

1:06:13founders. I'm always trying to you know,

1:06:16think about the the the data, the

1:06:18signals and ways to you know, get better

1:06:20at what I I do.

1:06:21>> Where do you do this like

1:06:23thinking? Is this like a

1:06:24a beach walk or run? Is this like

1:06:27grilling the founders call after call?

1:06:28Like where where do you get the

1:06:30>> I try to I try not to bug founders.

1:06:33You know, it's it's yeah, there there's

1:06:35a lot of

1:06:36Sometimes I'll hear VCs talking about

1:06:38you know, like oh yeah, I talked to

1:06:39these founders like all the time and I'm

1:06:40like I don't know if they really want

1:06:42that.

1:06:42>> [laughter]

1:06:43>> Like I you know, I am

1:06:44>> They have a company to build.

1:06:45>> Yeah, yeah. But no, I mean I love

1:06:47talking to all all the founders that I I

1:06:49work with.

1:06:50But yeah, like you know, in the shower,

1:06:52you know, you know, in the gym,

1:06:55you know, I'm I'm always

1:06:57thinking about this stuff. So um

1:06:59>> And I I guess like

1:07:01I begged the question earlier on like

1:07:03somebody listening to this and reverse

1:07:05engineering the story and coming to you

1:07:07and saying, you know, making up a story

1:07:09that is credible enough

1:07:11based on what you're looking for. How do

1:07:13you like

1:07:15How do How do you tell if they're faking

1:07:18it? Like Like intellectual honesty is

1:07:20interesting, but like if you're not a

1:07:22bio expert, the billion one people could

1:07:24lie to you. Like You know what I mean?

1:07:26Like

1:07:26>> Well, I I think I'm pretty good

1:07:29at detecting inconsistencies, you know,

1:07:32in a story,

1:07:34um in a way someone is communicating.

1:07:35And so I think I'm I'm pretty good at at

1:07:37detecting, yeah, when someone is is, um

1:07:41you know, kind of exaggerating their

1:07:42knowledge or

1:07:44or exaggerating about something that

1:07:45happened,

1:07:47um

1:07:47you know, or is just lying. I mean,

1:07:49there's, you know, that's one thing, but

1:07:50even if they're not lying, they, you

1:07:52know, often people like and

1:07:54exaggerate and things like that. And so

1:07:55I'm I think I'm pretty good at

1:07:58And then I like I I don't have any

1:08:00hesitation around asking the dumb

1:08:02questions.

1:08:03Um like I guess I have, you know, I've

1:08:05I've never lacked for intellectual

1:08:06confidence, so I don't mind letting them

1:08:08stew in it.

1:08:09I don't mind, you know, talking to some

1:08:10super smart person and asking like that

1:08:12like that like a dumb question. So I

1:08:13think I'm I guess if Yeah, if there's a

1:08:15few things that in my job I'm I'm really

1:08:17good at, I think one of them is that I'm

1:08:19I'm very, you know, like you could have

1:08:20someone tell me about quantum mechanics

1:08:23and, you know, have, you know, some

1:08:24someone who's bullshitting and someone

1:08:25who's not. And so I think I'd be I'm

1:08:26pretty good at at picking out the one

1:08:28who's who's uh

1:08:29who's being intellectually honest.

1:08:31>> And that gives them the opportunity to

1:08:32explain these technical things to you in

1:08:35a way that you want to understand and

1:08:36you can tell if they can share it with

1:08:37the world.

1:08:38>> Yeah, but I think I think they want to

1:08:40do like if you're a founder, like you

1:08:41you you know, you want to tell the

1:08:42story. Everyone likes talking about

1:08:43themselves and you kind of think it's

1:08:46fun to explain to, you know, someone

1:08:48who's maybe I'm smart, but I don't know

1:08:50anything about the thing. And so it's,

1:08:51you know, hopefully you view it as a bit

1:08:52of a challenge and you and I'm I'm could

1:08:54be a pretty good listener. And so, you

1:08:56know, I think that that's a good signal

1:08:58if you know, if someone is kind of like,

1:08:59"Oh my god, I don't want to talk to this

1:09:00idiot. He doesn't know

1:09:01anything." I think that's a bad signal

1:09:03for a founder. I mean, I might like I'm

1:09:04going to miss a few founders. There's

1:09:05probably one or two founders who are

1:09:07going to be successful like that, but um

1:09:09like the billion or one founders, they I

1:09:10don't think they left thinking, "God,

1:09:12that guy was stupid."

1:09:13>> [laughter]

1:09:13>> I think they're like, "Oh, yeah, well,

1:09:14he seemed like a nice guy."

1:09:16>> I spoke with um one of your portfolio

1:09:19company founders, Zane. I didn't speak

1:09:20with him. I just emailed him after um

1:09:22before this episode. And he mentioned

1:09:25that you're you are a generalist, but

1:09:27you're able to get up to speed so

1:09:28quickly. And I want to parlay this

1:09:30question into the the future and where

1:09:32we're going with AI and where we're

1:09:34going with technology. And it seems like

1:09:37it's going to be a lot harder to get up

1:09:39to speed on AI than it has been on

1:09:41historical sectors. It's you know, it's

1:09:44extremely um difficult to understand all

1:09:47the intricacies of this entire supply

1:09:49chain, what's going on, what's

1:09:50different, the models, the data, the

1:09:52infra, everything. Do you feel that your

1:09:55process on getting up to speed with

1:09:57these founders will be different going

1:10:00forward? Like, do you think it's going

1:10:01to be hard mode moving forward? Do you

1:10:03think it changes? Or yeah, what do you

1:10:04think?

1:10:05>> Well,

1:10:06I'm biased because I hope it doesn't

1:10:08change much. So,

1:10:10I do I don't think it'll change much.

1:10:12I'm very I'm you know, I I definitely

1:10:14want to use technology, use AI as much

1:10:18as I can. I think some people are

1:10:19precious when they kind of say, "Well,

1:10:21you know, AI is going to automate this

1:10:22part of of the job, but like it's not

1:10:24going to automate this part of the job,

1:10:25but that's what I do. You know, that's

1:10:27so special, you know?" And I'm like, I

1:10:28don't want to be precious like that,

1:10:29right? Like, AI can can automate

1:10:30everything. So, I want to be open-minded

1:10:32about that. But I I guess, you know,

1:10:34there's like a great Jeff Bezos quote or

1:10:35someone is maybe it's from like 10, 20

1:10:37years ago. Someone is asking him about

1:10:39about the future. Uh you might know this

1:10:40one. And it's like, "Oh, you know,

1:10:41what's going to happen in the future?"

1:10:42And he kind of says, "Well, you know,

1:10:44actually what I like to think about is

1:10:45is you know, what's going to stay the

1:10:46same?" And he's like, you know, I think

1:10:48in the future, you know, everything's

1:10:50going to change except people are going

1:10:51to want, you know, low prices, they're

1:10:52going to want, you know, big selection,

1:10:54and they're going to want, you know,

1:10:54fast shipping. And so, as long as we

1:10:56focus on that, like we're going to be

1:10:57okay. And so I like I think I think

1:10:59what's going to stay the same is, you

1:11:00know, these certain types of founders,

1:11:02these certain types of exceptional

1:11:04outlier, you know, brilliant,

1:11:05determined, resourceful, uh

1:11:07mission-oriented, intellectually honest

1:11:09founders. Like I just think they're

1:11:10going to be very successful in creating

1:11:12a champion in the future. And like my my

1:11:14algorithm is I'm not going to catch

1:11:15every founder. Uh like there's going to

1:11:17be some like hypey founders who have

1:11:18like huge exits, not for me. Um and some

1:11:21of my founders are not going to work

1:11:22out. Um and I'll miss some that that,

1:11:24you know, I'll regret. Um

1:11:26uh but it's like I I think this formula

1:11:28for finding founders, I think it's going

1:11:30to work. So,

1:11:31I'm not 100% sure that I'm going to be

1:11:33able to execute on it. I think I will.

1:11:34Um but I'm I'm you know, very confident

1:11:38that this formula

1:11:39um will will will be working if as long

1:11:41as capitalism runs reasonably Yes, so

1:11:44let me get this, you know, AI right now

1:11:45at such a dynamic time and some people

1:11:47think that, you know, the Terminator is

1:11:49just around the corner at the beginning.

1:11:50So, okay. Yeah, I mean, assuming a few

1:11:52things around capitalism and free

1:11:54markets.

1:11:55>> Well, you mentioned like what what won't

1:11:57change. It seems highly unlikely that

1:11:59like mass human founder psychology will

1:12:02change in 10 years or something. I feel

1:12:03like you're probably fine.

1:12:05>> Yeah, I mean, even if companies, you

1:12:06know, have, you know, a thousand agents

1:12:08for every human, you know, I I think

1:12:10that the founders who are most

1:12:11successful are are going to be pretty

1:12:13similar. You know, I think that that the

1:12:15the the Steve Jobs, the the Elon Musk,

1:12:17you know, the the the Sham Sankar, uh

1:12:20Melanie Perkins, it's kind of like,

1:12:21yeah, I think uh I mean, not everyone is

1:12:24going to be just as successful, but I

1:12:25think these are the types of people who

1:12:27who if you have a portfolio full of, you

1:12:29know, whatever, 10, 20, 30 of these of

1:12:32these uh startups, these types of

1:12:33founders, it's like I think it's going

1:12:35to be a great portfolio in five or 10

1:12:37years, uh even if the world is really

1:12:38different in some ways.

1:12:40>> One other like personal daily question I

1:12:42have for you is I like force-feed this

1:12:45book Essentialism to everyone at Telefy.

1:12:47Like Essentialism. Just managing your

1:12:50time, like focusing on the one thing you

1:12:52could be really successful at. And I've

1:12:54always found myself personally just like

1:12:56insanely unsuccessful when I have to

1:12:58manage four or five different things,

1:13:00context switching, things like that. I'm

1:13:02curious like how you manage your time.

1:13:05Like are you like is Mondays for

1:13:07sourcing and Tuesday Wednesday founder

1:13:08calls? Like how do you manage your time

1:13:10and how is that evolved over time?

1:13:12>> It's honestly stayed pretty similar

1:13:15as long as I've been a professional.

1:13:17Probably when I was a student, you know,

1:13:19it was a little different. You know,

1:13:21since I've been a professional, I have

1:13:23had like a digital calendar to look at.

1:13:25When I was a student, I didn't I didn't

1:13:26have that. I forget how I tracked

1:13:28things. I don't know what the hell I

1:13:30did. Um, and so yeah, and I it's like I

1:13:33I know that there are some people who,

1:13:35you know, want to have like meetings

1:13:37back to back to back. And some of you

1:13:38know, some of the people are amazing

1:13:39VCs. Like I talked to a VC the other

1:13:41day. I think he said he he talks to 10

1:13:43founders a day. And I was like

1:13:45That's not what I want. Um, so, you

1:13:48know, and then and then there are people

1:13:49like like big companies where I think a

1:13:50lot of it is kind of like a bunch of

1:13:52and then they've got meetings

1:13:53and you know, so I'm so busy and you

1:13:55know, so I guess I have like a view

1:13:57where for me where it's like I want to

1:13:59have like a certain amount of like, you

1:14:01know, programmed space things to do. But

1:14:03then I also have some free time. Um, and

1:14:06um, but yeah, that but I'm also

1:14:09extremely urgent to be productive. Like

1:14:11I, you know, I

1:14:12my wife says I shouldn't use the

1:14:13microwave as much as I but I use the

1:14:15microwave for for things. And like I'll

1:14:16put something in the microwave for 40

1:14:18seconds. And then I think I got 40

1:14:19seconds.

1:14:20>> What should I do?

1:14:21>> [laughter]

1:14:21>> Oh, vitamins. Oh, you know, tie my

1:14:23shoes. Um, and I've always kind of been

1:14:25like that. So I'm definitely like a big

1:14:27optimizer. But then also sometimes it

1:14:28feels like there are people who, you

1:14:30know, there are people who will like

1:14:30drive, you know, an hour to save a

1:14:32nickel. You know, there are people who

1:14:33will like, you know, read some yes spend

1:14:35eight hours, you know, productivity

1:14:36hacking, you know, like what have you

1:14:37done? Um, so

1:14:39>> How much time have you actually saved?

1:14:41>> I mean I have a few systems, you know, I

1:14:42will I will write things down. I have

1:14:43like a task list. Um

1:14:45>> But you're not getting back to every

1:14:46single inbound. You're not or like are

1:14:48you replying inbox zero kind of guy?

1:14:50Like

1:14:50>> I'm an inbox zero kind of guy.

1:14:51>> Yeah.

1:14:52>> I'm a but but my my inbox is so I have a

1:14:55task list and then my the emails in my

1:14:57inbox are I like another manifestation

1:15:00of a task list. Um and so I don't have

1:15:02in inbox zero. I usually strive to have

1:15:04inbox three and those are three

1:15:06important things.

1:15:07>> Okay. I always like to

1:15:09figure out how people spend their time

1:15:10just cuz it it just it works for you.

1:15:12>> Yeah. I mean there there's the guy um

1:15:14>> What's his name but he's a famous

1:15:15productivity guru and most of these

1:15:16people I I think are are not you know

1:15:19useful but he's the get getting things

1:15:21done guy. What's his name again?

1:15:22>> Um I don't remember his name.

1:15:23>> Yeah. So he he has some good rules and I

1:15:27Well, someone was telling me about his

1:15:28rules one time and I was like I those

1:15:29are like rules that I follow. You know

1:15:31about about yeah try you know like

1:15:33writing things down you know so you can

1:15:35just have more clear you know working

1:15:37memory and

1:15:39>> Maybe like closing conversation here but

1:15:41I want to talk through like maybe and

1:15:44I'll allow of this your way. You can

1:15:45take it any way you'd like. Like biggest

1:15:47setback in building Horizon. Like maybe

1:15:50it's a a personal story. Maybe it's a

1:15:51founder that you really rated highly it

1:15:54didn't work out. Maybe it was I don't

1:15:57know. I'm just curious like what the

1:15:59setback for you is.

1:16:00>> Yeah. It's like I don't I don't know how

1:16:02how personal you want to get but I would

1:16:04say that I have not had any significant

1:16:06setback in in Horizon. It's kind of like

1:16:08the It's kind of like the the the

1:16:10person's childhood you know who had like

1:16:12a pretty good childhood. Like you know

1:16:13I've been I've been a full-time VC since

1:16:152022. I have not had any significant

1:16:17setbacks. Uh there's been a few uh but

1:16:19okay. What were the moments where I was

1:16:20most like bothered or yeah there there's

1:16:23like one time where I really wanted to

1:16:24get in a deal and and I couldn't.

1:16:27Yeah. That that was but you know the big

1:16:29scheme of things all right. Um but I've

1:16:30had you know some good luck maybe you

1:16:32know hopefully I've had like good good

1:16:34strategy good execution. Now I could go

1:16:36back before in in other you know

1:16:38professional and personal avenues and I

1:16:40could

1:16:41maybe give you some sob stories about

1:16:42setbacks, but um so I feel like I'm

1:16:44pretty resilient. And so I would say,

1:16:46yeah, I mean, not that I would. I mean,

1:16:48I'm I'm sure I will have greater set

1:16:49setbacks as a VC. Um I'm going to do

1:16:52this for a long time and it's

1:16:54inevitable, but but I'm I'm I'm

1:16:55fortunate right now to say that uh yeah,

1:16:58I wouldn't say that I have.

1:16:59>> I don't think people randomly don't have

1:17:00setbacks though. It sounds like you must

1:17:02be working so hard you get to a point

1:17:04where you don't. Cuz like at some point

1:17:06it just becomes like chance. Like you

1:17:07will have a setback or something. Unless

1:17:09you're really

1:17:10>> I mean, it's like the big setbacks I

1:17:11think are um in VC, you know,

1:17:13fundraising can be a foot a setback, but

1:17:15yeah, we've we've haven't had a real

1:17:17struggle fundraising. I mean, there's

1:17:18been a few There's been a few people who

1:17:20said no, but but overall it's worked out

1:17:22pretty well. And then it's never it's

1:17:23never been a constraint. And I and I and

1:17:25I'm not trying to raise the biggest fund

1:17:26by the way. You know, I'm I'm I'm kind

1:17:28of modest and it's another story about

1:17:29what I want, but yeah, so

1:17:31>> [clears throat]

1:17:31>> um uh and I don't want to spend a lot of

1:17:33time fundraising. Like I've never want

1:17:34to spend more than like 10% of my time

1:17:36fundraising. Uh and then yeah, I would

1:17:37say another setback is companies, you

1:17:39know, having having failures. And uh we

1:17:42definitely had some companies not

1:17:43succeed. Probably the most painful thing

1:17:45is when you have a company that you

1:17:46think is worth a lot and then it kind of

1:17:48falls on hard times. And I'm sure that

1:17:50will happen in in the venture fund. Uh

1:17:51it hasn't yet. I I think we are

1:17:53investing in founders who are very

1:17:54resilient, who are not bullshitters. So

1:17:56I think our businesses are less likely

1:17:58to get like markups. Um as an

1:18:00angel investor I had a few, you know, I

1:18:02mean, you it's kind of like

1:18:03>> You feel good, but it's not real. It's

1:18:04like a paper worth

1:18:05>> Yeah, yeah, where you thought you had

1:18:06something that was, you know, a a 20x

1:18:08and and then it's it's not worth

1:18:09anything. So I I've definitely had that

1:18:11as an investor and it's and it's

1:18:12painful. Yeah, I have had it happen a

1:18:13couple times and you you realize it's

1:18:15kind of part of the part of the deal. Um

1:18:17so yeah, so hopefully I have a pretty

1:18:19good strategy. I am I'm pretty

1:18:20resilient. Um you know, I've got my

1:18:22partner Mike doing some of the things

1:18:24that maybe other VCs, you know, don't

1:18:27like to do. So that's another thing is

1:18:28is um yeah, it's like I get to spend

1:18:31time I mean, there's a few things that

1:18:32are a little annoying or or, you know, I