20VC Newsletter - 11th May 2025
Here are the transcripts and top takeaways from 20VC episodes released this last week.
Monday’s episode with Bucky Moore, Partner @ Kleiner Perkins:
Download the full transcript:
My 6 key takeaways:
Are Model Providers Good Venture Investments?
These companies have billions of dollars of run rate & growing 100%+ YoY.
Companies are just starting to layer products on top of these capital intensive investments.
The margin question is a valid one but they are just getting started.
Is the Age of Investing in Competitors Over?
There are 2 strategies when investing in AI:
Go all-in on one company: Thrive on OpenAI
Diversify investments: a16z backing every player.
It’s a rational strategy as long as you have buy-in from entrepreneurs.
AI Skills Are More Important Than Domain Knowledge
There are lots of application layer companies with domain experts but they are struggling to recruit AI engineers.
This technology is moving fast.
If you do not have truly AI native talents that understand where it’s going, you will not nail it.
How to Approach Price Sensitivity in a World of AI
One of my fave from @mamoonha: The best companies always feel expensive.
When you find a company that has demonstrated some path to market leadership relative to the field, go all-in.
The Future of Venture Is Specialisation
A founder told me “The person I went with had insights about the business not even my existing investors had.”
The only way to develop these insights is to spend time thinking about business more than anyone but the founder.
You will lose to the person who has done the work.
Why Market Sizing Is BS Today
The best founders have so much ingenuity they could decide which market they’re playing in.
They build new products, reframe existing problems & create new markets.
Market sizing is so imprecise it borders on being a fool’s errand.
Thursday’s episode with Rory O'Driscoll, GP @ Scale & Jason Lemkin, Founder @ SaaStr:
Download the full transcript:
My 6 key takeaways:
Have the Big VC’s Already Won & Are We Looking at a Mafia Situation?
They have 50-60% of all the capital.
They are great investors – If they don’t under-index they will have 60% of the wins.
The next 3-5 years will be tough for mid-tier firms.
People Are Going to Lose Their Jobs on Mass
We do not need SMB sales reps, marketing managers, customer success…
More of these people were unemployed 12 months ago than you think.
As soon as AI is even 80% as good as a human, they’re all gone.
VCs Are Upside Junkies
They love new s**t with option value over old s**t with intrinsic value.
There is no upside in intrinsic value.
Benchmark vs a16z
Across 15 years:
Benchmark: 63 Series A with 10% hit rate across 15 years.
a16z: 454 Series A with 2% hit rate.
a16z has 10 $5BN+ outcomes, while Benchmark has 6.
If you scale things up your quality slips, but the aggregate number goes up.
The ROI on University Sucks
The return on college is good for the STEM student.
But for everyone else they get a set of skills with no market value & they owe $150K.
The marginal return on the marginal entrant in the last 10 years is profoundly negative.
Why Universities Losing for Profit Status Is Bad for Innovation
The venture business in the US is funding things where they have a massive comparative advantage.
That comparative advantage is typically caused by high intellectual property industries like biotech, software & robotics.
That won’t be possible if we don’t have a well-funded higher education sector.
Friday’s episode with Eléonore Crespo, Co-Founder & Co-CEO @ Pigment:
Download the transcript:
My 6 Key Takeaways:
1. I Sourced My Co-Founder Like a VC
Asked 100s who the best engineers/operators were
Made a ranked list
Did CIA-level diligence
Romain was #1
2. We Talk 3X a Day. Co-ceos Are a Superpower
We have split responsibilities.
Product (Romain) vs Business (Eleonore).
We have never had a fight — just fast, small disagreements daily.
3. Every Round We Raised, We Already Had 2 Rounds’ Worth in the Bank
Pigment’s co-founder Romain had “seen the movie.”
Paranoia + cash = freedom to innovate aggressively when others can’t.
4. I Tell Candidates Upfront: Here’s the Shitshow You’re Inheriting
The best people love it & means no wasted time on average.
Clear signals for ego vs resilience.
Get aligned from the beginning. Do not sugarcoat.
5. Forget Market Sizing. Founders Create Markets
Find a generational founder and forget about TAM.
6. The Board’s Power Is Bigger Than You Think
“If they want to fire you, they probably can.
That’s why you don’t optimise for valuation.
Optimise for who’s around the table.”
Behind the Scenes:
Let us know what your big takeaways from this week’s shows were in the comments below!
Thank you for reading, and don’t miss the great guests we have next week:
Monday episode: Immad Akhund, Founder & CEO @ Mercury
Thursday episode: Jason Lemkin & Rory O'Driscoll
Friday episode: 20Growth
Thank you for reading 20VC.
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