20VC Newsletter - 26th January 2025
Here are the transcripts and top takeaways from 20VC episodes released this last week.
Monday’s episode with Hussein Kanji, Founder @ Hoxton Ventures:
Download the full transcript:
My 8 key takeaways:
More Money Increases the Likelihood of Success
If you’re going to be contrarian, you have to make sure your companies get capitalized.
The average is $300M to get to unicorn status.
You have to raise that kind of quantum of capital.
Do Not Fundraise for a Size but for a Time of Fund
Give yourself 90 days – Whatever you raise, start investing immediately.
Deploy the funds & start scoring points on the board.
Go back & raise more capital once you prove that your investments are successful.
The Formula to When to Sell
Once we’re out of lockup after the IPO:
Sell a third immediately.
Sell another third 6 months later.
Sell the remaining third 6-12 months after.
There is too much human error to not use a formula.
You Need to Be Profitable and Growing
In public markets, every SaaS company outside the top decile is both growing and profitable.
If you're a $100M private vertical SaaS company and you're not both growing and profitable, you have a long way to go before you can go public.
The Best Way to Scale Is in the US Not Europe
They have bigger rounds, bigger experience sets, & bigger markets.
Darktrace made more money in the US than the UK.
Our direction of travel is to find the best here & be the bridge to the US.
Small Seed Rounds Is a Massive UK Problem
If you believe in something at $1M, you should believe it at $3M.
You should be shooting for greatness as fast as possible.
VCs in Europe do not fully grok this concept.
The Opportunity to Build the Next European Great VC
There are only a handful of really good venture funds at the top in Europe but the market here has grown 30x.
I’d much rather play in a bigger market with more competition than a smaller market.
There is a chance for more funds to be on the list.
Why AI Means London Can Now Compete With the US
DeepMind is operating in London.
Meta is running their AI project in Paris.
This is the first time in history Europe is on par with the US in a horizontal field in tech.
Wednesday’s episode with George Sivulka, Founder & CEO @ Hebbia:
Download the full transcript:
My 7 key takeaways:
I Believe That All AI Companies Are Undervalued
It’s a massive unlock to what computing did for the economy over the last 60-80 years..
More than 50% of GDP will be contributed by agentic applications in the next few decades.
If we’re about to create a hundred trillion dollars of value, all the companies are massively undervalued.
The More Productive Agents Are the More Important Interface Is
If a company has 10,000 AI agents they will have a management problem.
The entire infrastructure layer to make them work will become a challenge.
We will need an extremely human-first product.
The Best Founders Are One of Three Things...
Three things:
They had a difficult childhood.
They are gay.
They were adopted.
Having difficult experiences early gives them something to prove.
Why Cloud is Much Stickier Than Foundation Models
The switching cost is simply too high.
Switching clouds for any substantially sized startup will be $10-20M & it is never worth it.
There will be an entire industry who could easily switch from OpenAI to Anthropic if one of them slows down.
Why X.ai Will Overtake OpenAI This Year
Elon is operationally talented & can run an efficient business.
He has a geopolitical advantage which can solve the energy bottleneck.
Whoever can operationalize model creation & serve them the fastest will win.
Spending $300 per Month on Rent and Living in a Closet
I left my $40k research assistant job at Stanford to work on Hebbia.
The cheapest rooms were all $1,000+, so I rented a master bedroom closet from my friend.
I worked 16-18 hour days 7 days a week.
How to Get a Job at NASA From a Cold Call
I stood outside their NY office and cold called every number I could find until someone let me in.
I pitched myself for 2 hours, landed an interview but botched it.
I memorized this professor’s studies, came back cold & told him everything I knew about his research.
Friday’s episode with Carlos Delatorre, CRO @ Harness:
Download the full transcript:
My 5 key takeaways:
Hire Sales Reps Before Sales Leaders!
Early-stage company CEOs should develop the plays & figure out the initial message.
Be the rep, hire a few SDRs.
Once you’ve built some conviction, go hire a team around it.
Sales People Do Not Sell, Buyers Buy
All we can do is create an environment that is conducive to that purchase decision.
Do good discovery, find challenges & educate on how your solution meets those challenges.
The art of closing is BS.
30% of a Sales Person’s Time Should Be Outbound
You should allocate 30% of your time a week to:
Outbound & cold calling (20%)
Preparation and follow-up (10–15%)
What Is Better Experience With Deal Size or Domain?
I prefer experience with deals over domain expertise.
There are exceptions like when the domain is too specific (e.g., molecular modeling tech).
Outside of that it is better to teach the domain & hire for sales skills.
Remote Work Leads to 4x Higher Churn in Sales Teams!!!
We noticed that if there is only a single rep in a city, they have a 4x higher attrition rate.
It is extremely hard to ramp all by yourself & teams do not collaborate as fast.
I’m a big advocate for hubs: 2 salespeople and 1 sales engineer is the minimum.
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:
Wayne Ting, CEO @ Lime
Fabien Pinckaers, Founder & CEO @ Odoo
Mayur Gupta, CMO & Growth GM @ Kraken
Thank you for reading 20VC.
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