20VC Newsletter - Apr 14th 2024
Here are the transcripts and top takeaways from 20VC episodes released this last week!
Monday’s episode with Co-Founder and former CEO of Postmates Bastian Lehmann:
Download the full transcript here:
My 8 key takeaways:
The Loophole that Made Postmates $5BN not $2.65BN
There was no collar on the exchange ratio when we agreed on the $2.65BN Deal.
We picked up the shares at $31 and they climbed to $55 by the time the deal closed.
We returned nearly $5BN to shareholders.
What Makes Dara Such a Good CEO?
He has an ability to give people autonomy and rewards people with trust.
A very calculated risk taker, and navigates legislation and cultural issues well.
Unbothered by the media narrative, just keeps on executing.
How I Raised $23M From Marc Andreesen
He is a hero to me and there was a mutual desire to work together.
He pinged me after hearing I was starting something new after Postmates.
We agreed on a $23M cold start series A. We are essentially doing 3-4 ideas in one startup.
The Great VCs Add No Value
Brian Singerman taught me that the greatest VCs are the ones who know not to interfere.
When you’re an investor, don’t try to move the needle, just write the cheques.
Stay out of the way.
VC Value Add is a Marketing Tool
Value add is a great marketing tool VCs discovered.
If they use it, they can attract talent & LPs.
It also increases their own value in the chain of how money flows.
Know when a VC is Digging to Invest or to Assess a Market
Some VCs are trying to gain insight into the industry, not your company.
If a VC needs to dig really deep regardless of cheque size, that’s a red flag.
Knowing the difference is critical.
The Biggest Companies in History are Being Born Today
There will be companies born today that will be larger than the largest companies today.
They will start as something small and overlooked.
That is my prediction in the field of AI.
Incumbents Can Be Replaced
Google went from the world's most respected company to a laughing stock with AI.
Apple spent years on the Vision Pro and it is 💩.
This is not a sprint, cracks start to appear and there is opportunity for others to disrupt the market.
Wednesday’s episode with Kevin Ryan, Founder of AlleyCorp and Co-Founder of MongoDB, Business Insider & Zola:
Download the full transcript here:
My 6 key takeaways:
MongoDB Did Not Make a Profit for the First 10 Years
We’ve lost a billion dollars before we had a profitable quarter.
We would not have been able to invest and grow as much today.
Not a lot of industries would give you a billion dollars to lose besides AI.
From WeWork Write Off to $80M Exit
We bought Meetup from WeWork for $10M when the pandemic started.
It was a unique buying opportunity & I knew the CEO from DoubleClick.
We went from a $20M loss on $32M revenue to $6M in profit.
Why I Do Not Care About Ownership
You will miss out on so many great companies by always focusing on ownership.
I would pay a bigger price for an incredible team & opportunity.
Getting less of a company doesn’t make it a bad investment.
The Danger of Signaling Risk
If a huge fund invests but doesn’t lead your next round, your company’s dead.
This doesn’t apply in seed investing because you’re expected to find someone else afterwards.
This happened to one of my companies because we lost faith.
So Much VC Cash on the Side
There is a ton of VC cash sitting on the sidelines.
That money won’t be given back & will be spent.
We’re only debating if they’ll do it in 2.5 years or 5.
Why Biden Deserves More Praise for the Economy
The collaboration between the Biden administration and the Federal Reserve has been remarkable.
We’re attracting more foreign companies to build in America.
Not a single economist thought this would happen.
Friday’s episode with Sam Blond, former Partner at Founders Fund and CRO at Brex:
Download the full transcript here:
My 6 key takeaways:
Why Domain Doesn’t Matter When Hiring Reps
It is extremely difficult to find an exceptional sales rep and hiring from one domain only would be a serious trade off.
I went from selling HR software (Zenefits) to credit cards & fintech (Brex).
If the reps are good at their job, they will pick it up quickly.
Why a Rep Must Come From a Startup
Your first Account Execs need early stage startup experience.
Don’t hire them from large companies like Salesforce.
The onboarding experience in that environment is radically different & they will not fit.
Don’t Use Recruiters, Leverage Your Network
We did not use recruiters at Brex.
I hired the first five reps from my networks, then we hired from their networks.
The probability of success will be so much higher.
Why Most Startups Are Doing Outbound Wrong
Start with your closest concentric circles then work outwards.
Our strategy at Brex:
Personal networks ➡️ Investor networks ➡️ YC companies ➡️ Fmr YC companies ➡️ The public.
Build your brand until you’re no longer a nobody company.
Three Ways to Measure Success of a Sales Hire
Performance: How much revenue are they generating?
Effort: Is this person working hard & setting the bar?
Attitude: Are they motivated & reflecting positively on their peers?
If performance isn’t there, you default to effort and attitude.
If either are lacking, give them a final warning on performance.
How a $BN Company is Getting So Many Customers Avoiding LinkedIn Ads
Rippling sends new employees an NPS survey after onboarding.
If they’re satisfied, they are offered a $50 gift card to post about their experience on LinkedIn.
It is much more cost effective & job announcements always perform better.
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:
Open AI CEO & COO Sam Altman & Brad Lightcap.
Vickie Peng, Partner, Product at Sequoia Capital.
Girish Mathrubootham, Founder & CEO at Freshworks.
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