20VC Newsletter - 3rd November 2024
Here are the transcripts and top takeaways from 20VC episodes released this last week!
Monday’s episode with Daniel Khachab, CEO & Co-Founder @ Choco:
Download the full transcript:
My 7 key takeaways:
The Cold War for AI Talent
Governments from the US, UK, UAE, & Saudi Arabia have invited us to move our talent to their countries.
They even offered to pay salaries for 3-5 years.
The cold war for top AI talent is real.
Why Enterprise Adoption of AI Will Be Much Quicker Than People Think
Traditional industries are slower to adopt enterprise software.
They need to retrain their employees, and it takes too much effort.
If they can use WhatsApp, they can use AI.
Why Europe is F***ed for AI
We are not producing chips, energy, or foundational layer models.
We are the last ones to receive new AI updates (OpenAI’s advanced voice API, Apple Intelligence).
Other countries have been pouring billions into chip plants & data centers, and we are falling behind.
The Notary Argument Is BS; The Best Always Find a Way and We Need to Stop Moaning
European entrepreneurs use regulation as an excuse.
Truly great entrepreneurs would not let regulation hold them back.
We Need Much More Long Term Minded Entrepreneurs
They should be willing to spend the next 15-20 years of their lives building generational companies.
This should not be a quick IPO cash-out.
We need more of them in Europe.
Why Being a Unicorn Sucks and the Regret of the Unicorn Party
We threw a unicorn party & I wish we had never done it.
People become less hungry & you start to receive applications from those looking for a safe place to work.
We are high risk, it’s going to be chaos & you’ll need to thrive on it
Why SF Is a Joke and Needs to Be Fixed
They have the highest number of $BN+ companies.
The best foundational layer models are coming out of there.
But homelessness is at an all-time high; none of it has increased the average quality of life.
Wednesday’s episode with Karri Saarinen, CEO & Co-Founder @ Linear:
Download the full transcript:
My 5 key takeaways:
Should Founders Monetize First or Wait for Platform
They should always target a niche first.
Build something really great for a small group of people then expand from there.
It’s better to boil a pot of water than the entire ocean.
Advice to Founders on Dilution
It’s the main thing you want to control.
I am never happy with 20% dilution.
I prefer 10% or less even in earlier rounds.
How to Stop Your Board From Firing You?
The only real protection you have as a founder is being successful.
Board control does not matter; there are a lot of ways investors can exert their influence.
They are way more experienced than you on this.
How to Give a VC Homework in a Fundraise
I give each investor separate memo docs.
There are questions for them to answer at the end.
The actual answers don’t matter; it shows their thinking style & simulates our working relationship.
Why Founders Should “Always Be Raising” is BS Advice
They should always think about the next round.
What would you want to get out of it? Who do you want in the round? What should you prepare for?
I still have casual chats with investors, so I have the relationships when the time comes.
Friday’s episode with Vladimir Tenev, CEO & Co-Founder @ Robinhood:
Download the full transcript:
My 6 key takeaways:
How a Credit Card Acquisition in the Middle of a Banking Crisis Turned Around Robinhood
The SVB crisis hit credit startups the hardest.
We created the Robinhood gold card after acquiring a company called X1 for $95M.
It was the best initial feedback we ever received on a product.
What Needs to Happen for Robinhood to be a $100BN Company?
Two things:
Become #1 in the active trading space
Become the primary platform for millennials to manage their assets.
We are on track to become #1 in trading: Options are up ~20% & equities are up 14% YoY.
Capturing a fraction of the $70TN boomers transfer to millennials will drive significant revenue.
INSANE STAT: Robinhood Has 8 Different Lines of Revenue That Do Over $100M ARR
When interests are high more money moves into equities.
When interests are low they move into margin books.
We are generally stronger under a declining interest rate environment vs rising.
Why Robinhood Hated Being Remote and The Pros of In Person
I immediately regretted it after announcing we were remote first.
Humans have been collaborating for thousands of years.
It will not go away instantaneously through technology.
How Will AI Change the Future of Wealth Management
Two ways:
Managers who do not trust it enough will use it as a tool.
Consumers w/o millions of dollars who do will use it to manage everything.
The real value will come from a concierge service that takes care of all your finances.
Is Buying a Home a Good Investment?
There are better ways to invest if you’re viewing it as an investment.
You need to pay taxes, commissions, maintenance fees, insurance, etc…
There are better returns & ways to diversify in equities.
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:
Sam Altman, CEO @ OpenAI.
Cem Sertoglu, Managing Partner @ Digital East Fund.
Thank you for reading 20VC.
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