20VC Newsletter - 27th Oct 2024
Here are the transcripts and top takeaways from 20VC episodes released this last week!
Monday’s episode with Mamoon Hamid, Partner @ Kleiner Perkins:
Download the full transcript:
My 7 key takeaways:
Mamoon’s Highest Returning Deal:
Top 4:
Slack: $250M valuation, $27BN acquisition.
Figma: $100M valuation, currently $20BN valuation
Rippling: $250M valuation, currently $13.5BN
Glean: $35M valuation, currently $4.6BN
Why I Invested in Slack at $250M post when they had $500K ARR.
They had around 10,000 users
⅓ were using the product multiple hours a day.
We saw it could scale by 1000x across many companies.
What I Saw in Dylan and Figma When They Had No Revenue & Little User Data.
The users used the product 18 days per month.
We saw early signs that it was working.
Why the $600BN AI CapEx Spend is Justified
Global GDP is around $100TN: 50-60% are in labor, 15% are tech.
It will grow to $130TN in the next decade.
A 5% growth in tech is an additional $10TN of annual spend.
The revenue will be there.
The Founder Type I Do Not Like
They look at the entire landscape to figure out where to build a great business.
They do a whole market mapping exercise & calculate the TAM.
They build the company with a top-down approach.
From One Week of Runway to Public Company: Box
We had to do 3 bridges for Box back in 2008.
The markets were afraid: People did not want to invest in a cloud storage business that could get eaten alive by Google or Microsoft.
Everyone was trying to save money for their own company.
How has Mamoon changed most significantly as an investor?
There’s more experience but it should not weigh me down.
The job is to stay open-minded & dream the dream.
Too many scars aren’t good for finding the next Figma or Rippling.
Wednesday’s episode with AJ Tennant, VP, Sales & Success @ Glean:
Download the full transcript:
My 5 key takeaways:
Biggest Lesson From Slack; Go Upmarket Early
Slack was a massive horizontal product.
When you have PMF at that level, you need to move upmarket faster & more aggressively.
We’ve done the same at Glean.
2 Reasons New Sales Reps Fail
Two things:
They only come to you with problems & no solutions or ideas.
They cannot collaborate effectively.
Why We are Still in the Experimental Budget Phase for AI
Lots of budgets are only a quick-fix to make employees more “AI-centric.”
It does not tie back to any business issues or measurable business outcomes.
They will churn in the next 1-2 years.
We are Seeing a Churn Problem for AI Products.
A lot of accounts are moving off those experimental budgets already.
Many vertical solutions are selling a big story on 10x-ing productivity with AI.
They will not deliver enough value to justify the incremental spend.
Do the Smartest People Today Still Want to Go Into Sales
The smartest people want to go into tech.
The 2 most impactful roles are product & sales.
If you don’t want to go into product, sales is the next best option.
Friday’s episode with Mark Goldberg, Managing Partner @ Chemistry:
Download the full transcript:
My 5 key takeaways:
The Biggest Mistake in VC Decision Making
If you try to make consensus decisions at early stage, you will end up as a consensus fund.
You need those 1-2 people with strong convictions about an idea.
Those will become the outliers.
The Benefits of Multi-Stage Funds: Follow on Funding
When Sequoia does a deal, there is usually money that follows it.
It is a feature of the brand equity they’ve built over a long time.
It is beneficial to the founders on future fundraises.
Why We Have Such a Light Reserve Model
We believe supporting companies at early stages is extremely important.
Allocating your reserves every pro rata round is not good for founders or LPs.
We only double down on exceptions.
The Dirty Secret of VC: Portfolio Services Teams are for VCs not Founders
They are a way to make something unscalable scalable.
Founders do not want to be disintermediated with the investor.
We're starting to see the cracks of an industry that has relied on subdivisions of the job.
Why Revolut Will Be the First $100BN Neobank
Nobody has cracked the product velocity that Revolut has.
The amount of features they have in such a short amount of time is unparalleled.
They are the closest neobank to hit $100BN.
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:
Daniel Khachab, CEO & Co-Founder @ Choco.
Karri Saarinen, CEO & Co-Founder @ Linear.
Vladimir Tenev, CEO & Co-Founder @ Robinhood.
Thank you for reading 20VC.
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Harry, you should record an episode where you are "in the chair", the one being interviewed. I'm sure all your listeners would love to hear in more detail about your journey, what the inflection points where, what your worst and most despairing moments were, what you have learned from interviewing so many great people. They can't all be inspiring, nice or clever, so just as you ask your guests about their bad experiences, it would be great to hear about your own. Also, it would be great to year your answers to the questions you often ask in the quickfire round. Love the shows (most of them).